Morning Commentary: High-grade deals thin; Simon Property offers notes; existing bonds mixed

By Cristal Cody

Tupelo, Miss., Nov. 30 – At least one investment-grade bond issuer plans to tap the primary market.

Simon Property Group, LP is offering notes due 2023 and notes due 2027.

Pricing action has been heavy over the last three sessions and is expected by market sources to continue at a brisk pace into mid-December.

In the secondary market, Simon Property’s notes that priced in November 2016 were mixed over the morning, a source said.

Simon Property’s 2.35% notes due Jan. 30, 2022 were last seen on Wednesday trading at 99.30.

The company sold $550 million of the notes at 99.672 to yield 2.417% and a spread of 75 basis points over Treasuries on Nov. 15, 2016.

Simon Property’s 3.25% notes due Nov. 30, 2026 were better at 99.99 mid-morning from 99.60 on Wednesday.

The company sold $750 million of the 3.25% notes at 99.737 to yield 3.281%, or Treasuries plus 105 bps, in the 2016 sale.

Simon Property’s 4.25% notes due Nov. 30, 2046 were flat at 103.86 in early trading.

The $550 million tranche priced at 99.378 to yield 4.287%, or a spread of 130 bps over Treasuries, in the 2016 offering.

The real estate investment trust for retail properties is based in Indianapolis.

Overall secondary trading volume totaled $17.24 billion on Wednesday, according to Trace.

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