S&P Global Ratings on Tuesday raised the long-term rating of the Hillsborough County Aviation Authority, Florida’s customer facility charge revenue bonds issued for Tampa International Airport (TPA) to A-minus from BBB-plus. The outlook is positive.
“The upgrade and positive outlook reflect the TPA's consolidated rental car facility's (CONRAC) demonstrated financial resilience during a period of materially depressed activity levels," S&P credit analyst Kayla Smith said in a release, "and our expectation that the facility will maintain financial metrics consistent with a strong financial risk profile given recent positive rental car activity trends that have exceeded our updated activity recovery estimates, with July, August and September 2021 monthly rental car transaction days at 91%, 80% and 86% of 2019 levels."
The bonds financed the construction of an airport rental car facility. In addition, the bonds partially funded a 1.4-mile automatic people mover. The CONRAC has a cash-funded debt service reserve that provides additional security for bondholders of about $37.4 million.
She noted that S&P could raise the rating even further if rental car activity at the airport — and the broader rental car industry in general — demonstrate a return to business-as-usual.
Tampa International has about $358 million of outstanding CFC debt, which is secured by a $5.95 per day CFC for cars rented at the airport.
Additionally, S&P raised the long-term rating and underlying rating on HCAA's outstanding senior-lien revenue bonds to AA-minus from A-plus and raised the rating on the authority's subordinate-lien revenue bonds to A-plus from A. Both issue of these bonds were issued for Tampa International. The outlook is stable.
“The upgrade reflects the airport's demonstrated financial resilience and rate-setting flexibility during a period of materially depressed activity levels, along with TPA's strong passenger recovery trends exceeding our expectations and S&P Global Ratings' updated activity recovery estimates,” Smith said. “We believe the traffic levels are sustainable and support an improved market position assessment and very strong enterprise risk profile."
S&P said the stable outlook reflected the expectation that Tampa International will maintain financial metrics “consistent with a strong financial risk profile given TPA's strong passenger recovery trends what we believe are sustainable.”
Earlier Tuesday, Tampa International said it is set to debut its “Blue Express Curbsides,” which will be only for passengers without checked bags. This will make Tampa International the first airport in the country to launch this feature.
The eight new lanes are expected to open in time for the Thanksgiving holiday period and are aimed at letting let passengers get to and from their gates faster by bypassing ticketing or bag claims.
"Our Blue Express Curbsides will better serve our guests and enhance an already smooth experience. On top of that, we’ll also be making our Main Terminal more efficient, decongesting busy areas and helping us prolong the life of our facilities,” Tampa International CEO Joe Lopano said in a release.
