Kukla's Korner Hockey
by Paul on 07/31/13 at 09:51 AM ET
from Amanda J. Crawford and Brian Chappatta of Bloomberg,
Glendale, Arizona, which has borrowed more than $355 million for professional sports venues, has seen the yield penalty on its bonds jump after approving an additional $225 million outlay to keep the National Hockey League’s Phoenix Coyotes in town.
While Coyotes fans gathered in Glendale city council chambers cheered the deal that is poised to keep the team in the Phoenix suburb’s publicly financed arena, investors have been less enthusiastic. Interest rates on some Glendale debt set a two-year high and yield spreads swelled as much as 20 percent after the city council on July 2 cleared a lease paying the team’s prospective owners $15 million annually for 15 years to manage the facility.
The deal weakens the former farming community’s credit and detracts from its ability to serve its 232,000 residents, said Pat Liberatore, an analyst at Moody’s Investors Service. The city has already had its bond rating cut by both Moody’s and Standard & Poor’s since November, and fired workers and raised taxes to close a deficit last year.
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Paul Kukla founded Kukla’s Korner in 2005 and the site has since become the must-read site on the ‘net for all the latest happenings around the NHL.
From breaking news to in-depth stories around the league, KK Hockey is updated with fresh stories all day long and will bring you the latest news as quickly as possible.
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