Department of Transportation | HDOT Airports Division finances the HNL rental car facility at historical record low rates

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HDOT Airports Division finances the HNL rental car facility at historical record low rates

Posted on Aug 19, 2019 in Airports News, Main, News

HONOLULU – The Hawaii Department of Transportation (HDOT) Airports Division successfully sold $194 million of taxable Airports System Customer Facility Charge (CFC) Revenue Bonds on Wednesday, August 14, 2019. The bonds were issued to finance the completion of the consolidated rent-a-car (CONRAC) facility at Daniel K. Inouye International Airport (HNL) in Honolulu.

The HDOT Airports Division secured an all-in interest rate of only 2.987% for the Series 2019A CFC Bonds, which translates into $37.5 million in debt service savings as compared to the Series 2017A CFC Bonds that had an all-in interest rate of 3.986%. Nearly $8.5 million of this debt service savings was generated by lowering the initial pre-pricing all-in rate of 3.214% to the final pricing all-in rate of 2.987%.

The HDOT Airports Division received over $1.2 billion in orders for the bonds, leaving the transaction six times oversubscribed. Because the demand for bonds was so strong, the underwriters were able to reduce interest rates significantly from the initial offering levels.

The credit rating agencies (Moody’s, S&P and Fitch) affirmed the ratings of the bonds, of A2/A+/A, respectively. These are amongst the highest ratings that each respective rating agency has given to any rental car facility in the nation. All three rating agencies also assigned “Stable” outlooks to the Bonds.

Bank of America Merrill Lynch served as the lead underwriter and Morgan Stanley served as the co-senior manager. Katten Muchin Rosenman served as the Airports Division’s Bond Counsel.

CONRAC construction is scheduled to be completed in the spring of 2021, followed by the tenant improvements and the grand opening to the public in the fall of 2021.

Work is underway on the consolidated rent-a-car facility (CONRAC) at HNL with construction scheduled to be complete in spring 2021 and opened in fall 2021 following tenant improvements. Photo courtesy HDOT or Hawaii Department of Transportation.

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Source: Hawaii DMV

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