Only $2.9 billion of new-issue volume expected for week; New York Transitional prepares sale

By Sheri Kasprzak

New York, April 4 - Municipal yields were relatively unmoved on Monday to kick off a very sparse week for new issues, market insiders reported.

"There's not a lot of activity," said one trader.

"Not many trades going on. We're mostly flat. There might be a little firmness on the short end, but I'd call it flat overall."

The coming week will provide just $2.9 billion of new bonds, said Tom Kozlik, municipal credit analyst with Janney Montgomery Scott LLC.

The week will be led by a $500 million offering of series 2011 future tax secured bonds (Aa1/AAA/AAA) from the New York City Transitional Finance Authority. The authority conducted the first of a two-day retail order period for the bonds on Monday. The pricing is expected to finalize on Tuesday.

The deal includes $483 million of series 2011E bonds and $17 million of series 2011F bonds. The 2011E bonds are due 2012 to 2025, and the 2011F bonds are due 2011 to 2025.

Proceeds will be used to redeem existing future tax secured bonds.

Volume will be made up of a few large deals. In addition to the New York deal, the District of Columbia and the City of Philadelphia have big offerings planned for the week ahead.

D.C. preps Howard deal

The District of Columbia is set to come to market during the week with $288.965 million of series 2011 revenue bonds (A3/A-/) for Howard University through Merrill Lynch and Loop Capital Markets LLC.

A portion of the bonds - $4 million - will be used to terminate an interest rate swap the university entered into with Goldman Sachs & Co., said Kozlik.

The deal includes $224.23 million of series 2011A bonds and $64.735 million of series 2011B bonds.

Proceeds, in addition to terminating the swap agreement, will be used to fund general upgrades and additions to three of the university's campuses and to refund and advance refund some of the university's debt, including its series 1998 and 2006A-B bonds.

Philadelphia deal ahead

Also coming up, the City of Philadelphia has a $272.23 million sale of series 2011 general obligation bonds (A2/BBB/A-) on the calendar.

The bonds will be sold through J.P. Morgan Securities LLC and are due 2011 to 2031 with term bonds due 2036 and 2041.

Proceeds will be used to refund the city's series 1998 G.O. refunding bonds and its series 2001 G.O. bonds.

New York Liberty deal planned

Looking out on the horizon, another major deal is in the works. The New York Liberty Development Corp. is expected to come to market with $900 million of series 2011A liberty revenue bonds, said a preliminary official statement.

The bonds will be sold through Goldman Sachs and JPMorgan.

The bonds are due April 15, 2031, April 15, 2041 and April 15, 2047.

Proceeds will be used to defease and redeem the corporation's series 2009 bonds.

The New York City-based corporation was formed in 2002 in response to the World Trade Center attacks to create new employment opportunities.

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