Sustainability bond of the year – US muni: New York City Housing Development Corporation

Companies: P Morgan, Morgan Stanley, Ramirez & Co., Merrill Lynch, Pierce, Fenner & Smith, Academy Securities, Jefferies, Barclays Capital, Citigroup Global Markets, George K Baum & Company, RBC Capital Markets, Loop Capital Markets, Stern Brothers & Co., TD Securities, UBS Financial Services, Wells Fargo Securities, Raymond James & Associates, Roosevelt & Cross, Credit rating: Moody's (Aa2), S&P Global (AA+), NYCHDC

People: Bill de Blasio

Deal highlights:

Issuer: New York City Housing Development Corporation

Size: $625 million

Maturity: May 2022 – May 2058

Coupon: 2.10% - 4.125%

Use of proceeds: Mortgage loans for affordable housing

 

Lead managers: JP Morgan, Morgan Stanley, Ramirez & Co., Merrill Lynch, Pierce, Fenner & Smith, Academy Securities, Jefferies, Barclays Capital, Citigroup Global Markets, George K Baum & Company, RBC Capital Markets, Loop Capital Markets, Stern Brothers & Co., TD Securities, UBS Financial Services, Wells Fargo Securities, Raymond James & Associates, Roosevelt & Cross, Credit rating: Moody's (Aa2); S&P Global (AA+)

Since joining the market in 2015, New York City Housing Development Corporation (NYCHDC) has been a serial issuer of sustainability bonds.

It has raised a total of $5.13 billion, as part of its Sustainable Neighborhood Bond (SNB) issuance programme, which finances mortgage loans and subsidies for affordable housing in New York City.

SNBs support Mayor Bill de Blasio's Housing New York Plan to create and preserve 300,000 affordable homes for low-and-middle-income New York citizens by 2026. The bond programme also aims to enhance environmental benefits, with many of the housing developments expected to receive Leadership in Energy and Environmental Design (LEED) certification.

NYCHDC's largest issue so far was in June 2018, and was worth $625 million. The deal contained 31 tranches with maturities varying between May 2022 and May 2058, and coupons between 2.10% and 4.125%.

The organisation's website contains reports on which housing developments have received sustainable building accreditations such as LEED, as well as the outstanding balance of each mortgage loan that has been financed by its SNBs.

NYCHDC acting president Richard Froehlich said: “SNBs are an important opportunity for investors seeking to make socially impactful investments and critical for bringing investment in our city’s neighborhoods to benefit some of the most vulnerable New Yorkers."