Research Update: Jets Stadium Development LLC Bond Ratings Affirmed; Outlook Negative On 2021 Attendance Uncertainty

Jets Stadium Development LLC (StadCo) was able to make its twice-yearly debt service payments with trapped cash this year. There is adequate trapped cash to pay the April 2021 debt service payment. At the same time, we anticipate that a vaccine will be available by June 2021 that will allow unrestricted fan attendance in the fall. Therefore, we project that the October payment should be fully supported by operating cash flows under our base case financial forecast. In our view, the stadium will not need to tap its debt service reserve under our base case, supporting the investment grade rating on the stadium. And if social distancing reduced fans to about 50% of capacity, we expect the stadium could use

...- Jets Stadium Development LLC (StadCo) was able to make its twice-yearly debt service payments with trapped cash this year. There is adequate trapped cash to pay the April 2021 debt service payment. At the same time, we anticipate that a vaccine will be available by June 2021 that will allow unrestricted fan attendance in the fall. Therefore, we project that the October payment should be fully supported by operating cash flows under our base case financial forecast. - In our view, the stadium will not need to tap its debt service reserve under our base case, supporting the investment grade rating on the stadium. And if social distancing reduced fans to about 50% of capacity, we expect the stadium could use existing liquidity to bridge a small gap in cash available for debt service. Only an extreme social distancing requirement (a 75% reduction or greater) may trigger cash flow insufficient to pay debt service. We would note the National Football League's (NFL) season could begin late next...

Research Update