Issuers delay more new issue sales; Texas Housing and Community Affairs to sell $129.6 million

By Cristal Cody and Sheri Kasprzak

New York, Sept. 23 - Despite a healthy number of upcoming sales, pricing activity mostly ground to a halt on Tuesday, echoing the predictions of market insiders earlier this week and last week. On Tuesday, offerings to the tune of billions of dollars were put on the back burner until market conditions improve.

"It's not surprising at all," said one market source when asked Tuesday about the delay of several offerings.

"Issuers are waiting to see how things are going to go in the market after this bailout and it may be a few weeks before everything settles down again."

Market sources reached last week and early this week agreed that, while there are plenty of new issues to be priced, the timing is just not right.

The New York City Transitional Finance Authority had been on the schedule to price $700 million in fixed-rate building aid revenue bonds Tuesday, but the sale is now postponed, according to Raymond Orlando, spokesman for the authority.

Orlando cited shaky market conditions as the authority's reason for delaying the deal and noted that it may price in the next one to two weeks. No exact date has been set for the pricing.

The bonds (A1/AA-/A+) are slated to be sold on a negotiated basis with Merrill Lynch as the senior manager.

Proceeds will be used for capital costs incurred by the city's department of education.

Hawaii's postponed deal

Another large sale was put off on Tuesday. The State of Hawaii planned to price $634.735 million in series 2008 general obligation bonds and G.O. refunding bonds, said Scott Kami, administrator of the state's budget and finance department.

"Due to recent market events, we have postponed our G.O. bond sale scheduled for today," Kami said.

"A new sale date has yet to be determined."

The bonds were slated to sell Tuesday through lead managers Citigroup Global Markets and Merrill Lynch.

The sale includes $300 million in series 2008DN G.O. bonds, $308.735 million in series 2008DO refunding bonds and $26 million in series 2008DP G.O. bonds.

The 2008DN bonds are due 2012 to 2028. The 2008DO bonds are due 2011 to 2018 and the 2008DP bonds are due 2011 to 2016.

Proceeds will be used to reimburse the state for public improvement expenses and costs associated with acquiring, constructing, extending or improving various public buildings and facilities. The rest will be used to refund a number of the state's outstanding obligations.

Wake County delays G.O. sale

Also, Wake County of North Carolina put off the sale of $524.365 million in bonds, the issuer said Tuesday.

The county planned to sell the bonds competitively Tuesday.

"We are monitoring the market and we will sell the bonds when the market normalizes," said Cheryl Spivey, debt manager.

"We have sufficient cash reserves to fund our projects in the interim."

The sale includes $354.5 million series 2008A G.O. public improvement bonds with serial maturities from 2016 through 2026 and $69.865 million series 2008B G.O. refunding bonds due 2010 to 2015.

The county also plans to sell $100 million in series 2008C and 2008D variable-rate school bonds.

Waters and Co. is the county's financial adviser.

Proceeds will be used to refund the $71 million outstanding from the series 1998 public improvement bonds and to finance the acquisition, construction, expansion and renovation of library, school and community college facilities and other county improvement projects.

Redmond 2J School in Oregon pulls sale

Elsewhere, the Redmond 2J School District in Deschutes County, Oregon, also pulled back on plans to sell $110 million in G.O. bonds on Tuesday, a sellside source told Prospect News.

"We may try to do it tomorrow or we may not. We're all sitting around waiting," the sellsider said.

The series 2008 bonds are due 2034.

Seattle Northwest Securities Corp. will manage the negotiated sale.

Proceeds will be used for capital construction and improvements.

Cleveland Municipal School sale delayed

The Cleveland Municipal School District in Ohio, too, postponed Tuesday's planned competitive sale of $70 million in bond anticipation notes, a market source told Prospect News.

"We're going day to day until the markets decide what the consensus is, so it will be at least next week," the source said.

The G.O. notes (MIG1//) are due Sept. 30, 2009.

SBK-Brooks Investment Corp. and Fifth Third Securities are co-financial advisers.

Proceeds will be used to provide new money to acquire sites and construct, renovate, furnish and equip school facilities.

Texas Housing and Community Affairs deal

Despite so many postponed offerings, some issuers did announce plans to price deals, but at least one was hesitant to put a pricing date on its deal.

The Texas Department of Housing and Community Affairs expects to price $129.6 million in single-family mortgage revenue bonds once the market stabilizes, a source with the issuer said Tuesday.

"We're waiting for the market to come back. It could be next week or it could be the week after," the source said.

The sale includes $79.6 million in series 2008A revenue bonds and $50 million in series 2008B variable-rate revenue bonds.

The series 2008A bonds have serial maturities from 2011 through 2018 and terms due 2023, 2028, 2033 and 2040.

The series 2008B bonds are due 2040 and will price initially with a weekly interest rate.

JPMorgan is the senior manager of the negotiated sale.

Proceeds will be used to purchase mortgage-backed, pass-through certificates.

Atlanta's tax allocation bonds

Other issuers also plan to bring new offerings, including Atlanta, which plans to sell $120 million tax allocation bonds to develop the BeltLine tax allocation district, according to a preliminary official statement.

The sale includes $42.33 million series 2008A, $70.265 million series 2008B and $7.405 million series 2008C tax allocation bonds.

The bonds are not rated.

Wachovia Bank, NA, is the senior manager of the negotiated sale.

Proceeds will be used to finance or refinance redevelopment costs to acquire and develop an abandoned BeltLine rail corridor and to create affordable workforce housing and provide economic development incentives in the BeltLine tax allocation district.

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