Supported by strong investor demand and continued improvement in financial metrics, the A.B. Won Pat International Airport Authority, assisted by the Guam Economic Development Authority and the Bureau of Budget and Management Research have successfully sold $67.8 million in bonds in the municipal market.

It was the first-of-its-kind standalone tender offer for Guam coupled with bond refinancing which resulted in a 4.27% All in True Interest Cost and savings of $3.23 million over the remaining term of the bonds through FY 2043.

The GIAA bonds were oversubscribed by 9.3 times, which allowed for an opportunity to lower borrowing rates for higher savings.

Consistent with recent Guam municipal bond issuances, this issue was received with as much enthusiasm by municipal investors due to the GIAA’s strong fundamentals and resilience as it continues to recover to pre- pandemic passenger activity. 

Investor interest in the GIAA credit was strong and influenced by the recent upgrade of the government of Guam’s General Fund credit rating.

Overall interest rates have declined since their Fall 2023 peak levels and the tender and refinancing structure allowed the GIAA to offer to buy bonds that could not otherwise be refinanced for debt service savings from existing GIAA bond holders and sell refunding bonds to finance the purchase. 

In the current interest rate environment, municipal issuers have increasingly used tender offers to generate debt service savings.