Summer travel boom reignites airport-bond sales in August

Cities are reviving plans to tap the $4t municipal-bond market to build and renovate runways, concourses and terminals for airports as passenger traffic rebounds to levels last seen before the pandemic. During the first half of 2023, sales of airport bonds dropped to roughly $3b — less than a third of the amount seen in the year earlier period — as the Federal Reserve raised interest rates. But a cluster of sales totaling $1.8b in August has brought the sector back to life. Recent sales for hub airports in Chicago, Atlanta and Dallas-Fort Worth indicate a pick up of issuance given pent-up capital needs, said Mikhail Foux, head of municipal strategy at Barclays. And a number of upcoming sales signal issuance will continue. Charlotte, North Carolina, and Minneapolis-St. Paul in Minnesota are expected to sell debt for their respective facilities, according to preliminary bond documents. US airports need $151b over the next five years to meet infrastructure needs, according to Airports Council International-North America. With pandemic federal aid running out as travel rebounds, city governments will be turning to the bond market for money to fund long-term airport projects. “Airports are feeling confident because travel is back in a big way,” C. Courtney Knight, Atlanta’s treasurer, said in an interview. “That gives us confidence and the desire now to implement capital projects that are driven by increased travel.”<br/>