On November 2, 2023, the New York Transportation Development Corporation (NYTDC) issued its $877,855,000 Special Facilities Revenue Bonds, Series 2023 and loaned the proceeds to Delta Air Lines to finance a portion of the costs relating to a construction project the airline is undertaking at LaGuardia Airport. The redevelopment consists of the demolition of substantially all of LGA Airport’s previously existing Terminals C and D, the design and construction of new terminal facilities at LGA Airport, and the design and construction of certain other facilities at LGA Airport.
Delta is required to pay debt service on the 2023 Bonds through payments under loan agreements with NYTDC, and it has also guaranteed the 2023 Bonds.
Meanwhile, JFK NTO (NTO) has also indicated that it is considering issuing one or more series of tax-exempt Special Facilities Revenue Bonds (John F. Kennedy International Airport New Terminal One Project), through the NYTDC, acting as conduit issuer. Subject to market conditions and approvals of NTO, NYTDC and the Port Authority of New York and New Jersey, this potential transaction may price as early as November 2023 through a group of underwriters led by Citi.
As with Delta, NYTDC is expected to lend the proceeds of the bonds to NTO. NTO has agreed to undertake a project that involves the development, construction, financing, operation and maintenance of the New Terminal One passenger terminal facility at John F. Kennedy International Airport.
The bonds are expected to be payable primarily from project revenues of NTO, including payments made by airlines, providers of concession goods and services, and other commercial users of the New Terminal One. The bonds are expected to be secured on parity with certain bank loans incurred by NTO and certain other parity borrowings and other obligations of NTO outstanding from time to time.