Municipals weaken as $840 million Port Authority bonds price; American Municipal sells bonds

By Sheri Kasprzak

New York, Dec. 1 - Municipal yields edged up slightly to kick off December after experiencing some improvements over the past few sessions, market insiders reported. Yields were seen up by 1 to 3 bps across the curve, one trader noted.

"We're really just following Treasuries today," he said.

"Treasuries took a hit, and we're not off by that much, but there's a definitely weak tone out there."

Meanwhile, primary action was led by an $840 million offering of debt securities from the Port Authority of New York and New Jersey.

The authority priced the debt (Baa3//BB) to finance the expansion of the JFK International Air Terminal for Delta Airlines at John F. Kennedy International Airport.

The details of the offering were not immediately available Wednesday evening.

American Municipal sells bonds

Elsewhere during the day, American Municipal Power Inc. of Ohio sold $667.455 million of series 2010 revenue bonds (A3/A/) through Wells Fargo Securities LLC.

The offering included $36.535 million of series 2010A taxable bonds, $605.17 million of series 2010B Build America Bonds, $20 million of series 2010C clean renewable energy bonds and $5.75 million of series 2010D tax-exempt bonds.

The full pricing details for the offering were not available Wednesday and calls to the issuer for terms were not returned.

Proceeds will be used to construct the 105 MW Meldahl hydroelectric facility on the Ohio River.

Chicago brings G.O.s

In other news, the City of Chicago priced a portion of its long-anticipated general obligation bonds. The city priced $213.59 million of series 2010B general obligation Build America Bonds Wednesday, said a pricing sheet. The deal is one part of an $804.285 million sale that also includes $123.155 million of series 2010A G.O. refunding bonds and $467.54 million of series 2010C taxable project and refunding bonds.

The bonds were sold through Loop Capital Markets LLC and Wells Fargo Securities LLC.

The bonds are due Jan. 1, 2040 and have a 7.517% coupon priced at par.

Proceeds will be used to finance public right-of-way improvements, economic development enhancement projects, transportation improvements and grants to nonprofit organizations.

Washington Biomedical bonds price

In the Northwest, the Washington Biomedical Research Facilities 3 of Washington State priced Wednesday $164.95 million of series 2010 lease revenue bonds, said a pricing sheet.

The bonds (Aa1/AA+/) were sold through Barclays Capital Inc.

The deal included $151.745 million of series 2010B Build America Bonds and $13.205 million of series 2010C taxable bonds.

The 2010B bonds are due 2014 to 2022 with term bonds due 2025, 2030 and 2042. The serial coupons range from 3.049% to 5.431%, all priced at par. The 2025 bonds have a 6.031% coupon priced at par and the 2030 bonds have a 6.416% coupon priced at par. The 2042 bonds have a 6.516% coupon priced at par.

The 2010C bonds are due July 1, 2013, and have a 2.242% coupon priced at par.

Proceeds will be used to develop and construct a biomedical facility at the University of Washington's School of Medicine.

Liberty bonds ahead

Looking out on the horizon, the New York Liberty Development Corp. is expected to price $1,308,165,000 of series 2010 liberty revenue bonds, said a preliminary official statement.

Goldman, Sachs & Co. and J.P. Morgan Securities LLC are the senior managers.

The bonds are due Dec. 15, 2050.

Proceeds will be used to reconstruct Tower 4 of the World Trade Center.

Headquartered in New York, the corporation was founded in 2002 following the terrorist attacks on the World Trade Center to relieve unemployment and provide new job opportunities.

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