The Series 2023A bond proceeds are being used to fund certain projects that are part of the Chicago Works program, that started in 2021, and refinance one or more line of credit agreements to provide funds for interim financing for Chicago Works purposes. The Series 2023B bond proceeds are being used to finance portions of certain Chicago Recovery Plan (“CRP”) Projects, which is one of the most progressive investment plans throughout its various communities. 

In the last 4 months, the Rating Agencies have awarded the City 10 Rating Upgrades and 3 Positive Outlooks through all City credits. Moody’s upgraded the City’s GO credit by 1 notch to investment grade, the first upgrade since 2010. S&P and Kroll revised the City’s GO outlook to Positive from Stable. Fitch upgraded the City’s GO credit by one notch, the first upgrade Fitch has given the City since 1998, and revised the outlook to Positive from Stable. The City’s marketing included wide distribution of the POS, thorough marketing by the syndicate, an online roadshow, 4 one-on-one calls with investors and an in-person investor meeting in NYC. The Bonds were originally planned to priced in January of 2023 as volatility in the market was rampant. December brought on some stability and positive market tone, so the City, along with its Advisors and Joint-Senior Managers, explored accelerating the pricing into December which was eventually executed on December 8th.

The 2023A Bonds were structured with principal maturing serially in 2029, 2033-2041, and 2043 (4%, 5%, 5.25%, and 5.5% coupons), with an optional call on January 1, 2032 (except for the 2041 and 2043 maturities, which have an optional call on January 1, 2030). The 2023B Bonds were structured with principal maturing serially in 2038-2039 (5.25% and 5.5% coupons), with an optional call on January 1, 2032. 

The transaction received robust investor demand and after the order period, maturities were oversubscribed by 1.0x to 13.0x, depending on the maturity with strong oversubscription levels on the long end. Overall, the transaction received over $4.5 billion of priority orders and was, on average, 8.5x oversubscribed. 

Given the strength of the order book, the underwriters collectively tightened spreads by an additional 5 to 15 bps across all maturities satisfying the expectations of the City and its co-financial advisors. SWS’ strong marketing and pricing efforts resulted in the City achieving an all-in TIC of 4.963%.