The series 2023 senior lien bonds will be fixed rate and fully amortizing, with a final maturity in 2056.
BondBuyer.com recently reported the bonds are expected to be priced later this month. When Seatrade Cruise News asked PortMiami about the timetable, a spokeswoman had no update.
New Royal Caribbean Group campus
The series 2023 project consists of the completion of Royal Caribbean Group's campus expansion at the port, including a new building and improvements to parking and other areas of the campus. PortMiami entered into new agreements with Royal Caribbean to take over the campus project, redevelop Cruise Terminal G for Royal Caribbean's exclusive use and build a new Berth 10 to be served by the new terminal under construction by MSC Cruises.
The campus lease agreement with Royal Caribbean was amended for the county to finance $450m of the campus improvements. As part of the amended agreement, the cruise operator's annual lease payments will increase by 125% of the project financing costs up to $44m over a 30-year period.
The new Cruise Terminal G and Berth 10 are expected to be debt-funded, capped at $325m. New minimum annual passenger guarantees range from 600,000 during the development period, increasing to 1.5m after substantial completion of Terminal G, expected in early fiscal 2027, and 2.1m upon substantial completion of Berth 10. Royal Caribbean will reimburse the county for a minimum of 47% of project costs through a capital recovery surcharge fee.
Moody's and Fitch ratings
Moody's Investors Service assigned an 'A3' rating (an upper medium grade) with a stable outlook to the bonds.
Fitch Ratings assigned an 'A' rating (low default risk with the capacity for payment considered strong) with a stable outlook.
'The rating reflects PortMiami's fundamental operating strengths, including its global leading cruise port market position and its role as one of the largest ports in the state of Florida in terms of cargo volume,' Fitch said. 'The rating is further supported by the port's substantial, long-term contractual minimum annual guarantees with both cruise and cargo operators, which have historically helped to insulate port revenues from volume and passenger volatility.'
Fitch added: 'PortMiami's unrestricted funds remain substantial, providing sufficient liquidity to cover debt service payments and support operations in the near term. Leverage metrics are expected to remain elevated under the Fitch rating case due to the substantial capital plan that calls for sizable borrowings in the near- to medium-term but are projected to stabilize at a level in line with the "A" category following the completion of major capital projects.'
6.8m passenger moves projected in fiscal 2023
As of July 14, PortMiami recorded more than 6m revenue passengers, up from approximately 4m in fiscal 2022 and compared to 6.8m in fiscal 2019. Cruise-related revenues in fiscal 2022 recovered to more than 95% of pre-pandemic levels.
Approximaely 6.8m passenger movements are projected in fiscal 2023. The port expects passenger moves to increase to about 9.4m by fiscal 2028.