PHOENIX, AZ – Moody’s Investors Services (Moody’s) has upgraded from Aa3 to Aa2 the long-term rating on Phoenix Civic Improvement Corporation’s (CIC) senior lien general airport revenue bonds (GARBs) and from A1 to Aa3 the long-term rating on CIC’s subordinate lien GARBs issued on behalf of Phoenix Sky Harbor International Airport (PHX).
According to the City Council, both credits have a stable outlook. Moody’s also assigned Aa2 to CIC’s Airport Revenue Refinancing Bonds, Series 2023 (AMT).
The City noted that the ratings reflect the airport’s improving air passenger base thanks to low competition in the region and Phoenix’s growing and diversified economy. In addition, the ratings also show the high quality of the city’s financial management by achieving solid financial targets and managing a financially strong capital enrichment plan.
“Phoenix Sky Harbor is the largest economic engine in the state of Arizona and one of our most valuable assets,” stated Phoenix Mayor Kate Gallego. “These ratings reinforce the strong management and outlook for our Airport, which is vital to our growth area as we continue to seek to attract new investment.”
Moody’s expects the Airport’s origin and destination (O&D) passenger base to continue to grow modestly and expects the Airport to continue to effectively manage the current capital plan.
“The ratings reflect the high quality of the Airport’s financial management and its proven track record of meeting, or exceeding, financial targets,” said City of Phoenix Chief Financial Officer Katheen Gitkin.
Phoenix Sky Harbor International Airport recently released passenger figures for the month of March showing that more than 4.6 million people traveled through the airport. This number is a two percent increase from March 2019 before the Covid-19 pandemic and when the Airport had its busiest month in history. March 2023 marks the busiest month in Phoenix Sky Harbor’s history.
A high bond rating means the Airport can obtain lower interest rates when issuing debt for airport improvements and modernization projects. Phoenix Sky Harbor is currently working on projects that include improving airfield efficiency with a new north/south taxiway on the west side of the airport, a second north concourse in Terminal 3 and a post-security walkway connecting Terminals 3 and 4.
These ratings reflect the airport’s ability to move forward with the capital plan while maintaining competitive costs for airlines amid record passenger growth.
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