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April 6, 2018

The Bond Buyer: Mathian Vali quoted in “Bonds for Vegas Raiders stadium won't offer high yields”

“Bonds for Vegas Raiders stadium won't offer high yields” by Keeley Webster, The Bond Buyer.

Stadium debt is often considered riskier by investors than GO paper, usually junk bond or bottom-rung investment grade rated, while Clark County's bonds received an Aa1 rating from Moody’s Investors Service and AA-plus from S&P Global Ratings, said Mathian Vali, a credit research analyst at Bel Air Investment Advisors.

The county's financial backing changes the game.

“It’s not a typical stadium deal dependent on revenue from the stadium like ticket sales,” Vali said.

A more typical stadium bond would trade significantly cheaper to a GO credit, Vali said. For instance, Vali said, investors wanted a significant discount when bonds were sold for the Barclays Center, home to the Brooklyn Nets professional basketball team, compared to the extremely low yields on New York City general obligation bonds.

Vali expects the bonds will receive a good reception given the lack of supply in the market.

He pointed to the $3.2 billion New Jersey tobacco bonds that were 10 times oversubscribed when they priced Wednesday.

“That was a single-A credit and this is double-A, but it shows there is a lot of appetite from the buy side,” Vali said.

Read the full article here.