Transaction Details

American Leadership Academy

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Strong Investor Demand, Resulting in Aggressively Low Yields

American Leadership Academy was incorporated in 2009 and has grown to be a seasoned public charter school network that spans across Arizona, serving grades PK-12. The growing student population of +/-16,000 is expected to reach 25,000+ by FY2028. For the 2024-25 school year, American Leadership Academy will serve students in grades K-12 across 20 campuses and online in Arizona. Their mission is to provide the best educational experience to as many students as possible in a moral and wholesome environment.

To support their continued expansion efforts, American Leadership Academy needed to finance the acquisition of its Applied Technologies campus, refinance an interim loan used to acquire and construct its North Mesa campus, and finance the construction to complete its high school facilities and a performing arts center also at its North Mesa campus.

Baird’s National Charter School Finance team served as sole managing underwriter on the $201,620,000 non-rated financing for American Leadership Academy. The Baird banking team worked diligently to pre-market the transaction the week prior to pricing, answering numerous investor questions. The high yield supply/demand imbalance and the overall tone of the fixed income markets following the Fed’s recent action to lower its benchmark interest rate provided a favorable backdrop to price the bonds. Baird’s marketing efforts resulted in 50+ different investors submitting orders during the bond sale.

After the successful “order period” for the bonds, Baird ultimately achieved a very aggressive “reprice” of the bonds by lowering yields 30 basis points (0.30%) for most maturities, which is unprecedented. The result was the lowest interest rate “spreads” to the tax exempt market index (MMD) achieved for a non-rated charter school bond nationwide since January 1, 2023.