Transaction Details

Pasadena Economic Development Corporation

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The Pasadena Economic Development Corporation (the “Corporation”) is a non-profit created by and located in the City of Pasadena, Texas. The Corporation was created to promote, develop and finance new and expanded industry and manufacturing within the City of Pasadena and surrounding areas.

Baird served as senior managing underwriter to the Pasadena Economic Development Corporation (the “Corporation”) on its $49,500,000 Sales Tax Revenue Bonds, Series 2023 (the “Bonds”). Proceeds from the sale of the Bonds will be used to fund redevelopment and expansion projects at the convention center.

The Bonds are secured by a pledge of one-half of one percent sales tax that is to be collected within the boundaries of the City of Pasadena. They amortize with approximately level principal and interest payments each year for the next 30 years.

The Bonds priced on Monday, October 2. We delayed our release by an hour (10:30AM ET) to give accounts time to have their Monday morning meetings and our sales group time to continue pre-marketing.  Delaying the release also allowed us to see what the ISM numbers were. Most of those numbers were stronger than anticipated except ISM Prices Paid which were quite substantially lower, causing us to think Treasuries could regain their morning losses. Unfortunately, that was not the case, and the Treasury sell off that began in mid-September persisted on the stronger than expected readings, causing the 10-year Treasury to hit a high of 4.697% (+10 basis points). The Bloomberg AAA BVAL curve saw some softening with municipal yields increasing approximately 2 basis points.

With great efforts from our sales team, the syndicate was able to build a very nice book of about 3-5x subscription on most maturities. We received orders from multiple account types including SMA’s, banks, corporations, retail, hedge funds, bond funds and other money managers. This allowed us to reprice yields 2 to 4 basis points lower on all years, except 2043 which was just 2x subscribed. The true interest cost of the financing was finalized at 4.92%.