Municipals end firmer on the day as Treasuries gain; Village Center, Fla., offers 144A bonds

By Sheri Kasprzak

New York, Sept. 29 – Despite light secondary action, municipals were somewhat firmer, following in line with improved Treasuries, traders said during the session.

Yields were 2 to 3 basis points lower across the curve with intermediate to long bonds experiencing the most movement, said a trader in the afternoon.

Amid that light trading activity, yields on California’s various purpose general obligation bonds were seen lower by about 10 bps in spots. The 3.75% 2037s were trading at 3.75% on Monday after pricing at 3.84% last week on Tuesday.

Elsewhere, Sales Tax Asset Receivable Corp. of New York City saw yields on its recently priced bonds also fall in secondary. The 3% 2029s were trading Monday afternoon at 2.798% after pricing last week at 3.10%.

Village Center brings bonds

In one of the more unusual offerings recently priced, the Village Center Community Development District of Florida came to market with two private placements conducted under Rule 144A. The district priced $172,425,000 of series 2014 taxable recreational revenue refunding bonds and $70.3 million of series 2014B taxable utility revenue refunding bonds.

Market sources contacted about the frequency of such bond issues said that muni issuers do sometimes sell debt through private placements and that sometimes that debt is offered on an unregistered basis. It’s unclear whether the district’s legal designation as an independent local unit of special-purpose government, per the Uniform Community Development District Act of 1980, has anything to do with its ability to sell unregistered bonds.

Recreational bonds sold

Among the bonds offered were $172,425,000 of taxable recreational refunding bonds.

The bonds (/A/) were priced through dealer Citigroup Global Markets Inc.

The bonds are due 2015 to 2019 with term bonds due in 2024, 2029 and 2036. The serial coupons range from 1.303% to 3.088% and all priced at par. The 2024 bonds have a 4.156% coupon, the 2029 bonds have a 4.756% coupon, and the 2036 bonds have a 5.015% coupon. They all priced at par.

These bonds will be used to refund the district’s series 1998A-C, 1999A, 2001A, 2003A-B and 2004A-B revenue bonds, which were issued to acquire facilities for the Villages senior living community in Lake County, Fla.

Utility debt prices

Also, the district sold $70.3 million of series 2014B taxable utility refunding bonds.

The bonds were offered through dealer Citigroup and are due 2015 to 2019 with term bonds due in 2024, 2029 and 2036. The serial coupons range from 1.303% to 3.088% and all priced at par. The 2024 bonds have a 4.156% coupon, the 2029 bonds have a 4.756% coupon, and the 2036 bonds have a 5.015% coupon. They all priced at par.

Proceeds will be used to refund the district’s series 2003A utility revenue bonds.

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