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Colorado Municipal Supply Sets Monthly Record in August 2018

Updated: Sep 6, 2018

As seen in the Bloomberg chart below, the Colorado municipal market has set a monthly record for new issuance in August of 2018. Denver International Airport’s issuance of over $2.5 billion played a key role in the record.

DIA’s new issue refinanced some older debt but the proceeds were primarily used to finance gate expansions and a terminal remodel. This A2 rated subordinate deal was well subscribed. National municipal bond investors pay close attention to large deals in Colorado due to our specialty state status (no state GO’s). The yields were competitive and offered a 3.09% yield to maturity, subject to AMT, in the roughly $70 million 10-year portion. Given the large tranche sizes of the longer maturities, these securities will continue to be key holdings for the large national players in the Colorado municipal market.

With this monster deal, Colorado’s new issue supply in 2018 is on track to meet or exceed 2017’s new issuance of $8.7 billion. New issue supply last year was heavily influenced by tax reform. This contributed to accelerating refunding activity late in 2017. A larger Colorado municipal market is consistent with our expanding economy and provides investors more options to build their portfolios.

Data for chart retrieved 8/20/2018. This report is for information purposes only and should not be considered a solicitation to buy or sell any securities. Neither Equus Private Wealth nor any other party guarantees its accuracy or makes warranties regarding results from its usage. Redistribution is prohibited without the express written consent of Equus Private Wealth Management, LLC. For questions regarding this report, please call Equus Private Wealth at 970-963-9274.

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