Jan. 13 (Bloomberg) -- Greenwich, Connecticut, the top-rated home to hedge funds AQR Capital Management and Traxis Partners, is selling the most debt in its 358-year history.
The offering of $85 million in one-year notes on Jan. 16 will pay for a new auditorium at Greenwich High School, renovations to a fire station and a refurbishing of the Nathaniel Witherell nursing home.
“It is by far the largest borrowing the town has done at one time,” Comptroller Peter Mynarski said in a telephone interview. “It is about timing of the three projects.”
Moody’s Investors Service awarded Greenwich its Aaa rating, citing “abundant taxable resources, substantial wealth levels and a growing but manageable debt position.”
Demand from buyers of top-rated muni debt looking for tax-exempt securities in Connecticut will help Greenwich’s sale, said Matt Dalton, who manages $1.8 billion of munis at Belle Haven Investments Inc. in White Plains, New York.
“They’ll get great demand because you never see it,” Dalton said. “When you get issuance in a state where it’s hard to find a lot of AAA stuff, it really stands out.”
Greenwich, incorporated in 1656, had $31 billion in taxable property in 2012, according to town documents. The median family income was $173,000 a year, according to the 2007 to 2011 American Community Survey by the U.S. Census.
The town also plans issue $45 million in general-obligation bonds on Jan. 16, with maturity dates as long as 2034, its largest long-term offering since 2010, according to data compiled by Bloomberg. The bulk will be retired by 2019, in keeping with the town’s policy of limiting debt repaid with general-fund revenue to five years.
A portion of that sale will be used to repay some debt coming due this year, according to the official offering statement. The later maturities will finance a project that the town expects to repay with federal funds, Mynarski said.
Greenwich last sold long-term general-obligation bonds in January 2013, with the longest maturity in 2018. Those bonds priced below benchmark munis, data compiled by Bloomberg show. Debt maturing January 2018 priced through competitive bid with a 0.68 percent yield, about 0.18 percentage point below top-rated munis with similar maturity, Bloomberg data show.
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