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Coyotes costing Glendale in municipal bond market

Jan 25, 2012, 3:57 PM EDT

Bond market Getty Images

Investors in municipal bonds are worried about Glendale’s finances as the Arizona city waits on an owner to buy the Phoenix Coyotes and either keep them in the city-owned Jobing.com Arena or move them to another market.

Dow Jones reports that Glendale was forced to drop the price on $52 million in debt it sold this week, as bond buyers demanded a higher return to compensate for the perceived risk associated with the in-limbo NHL team.

Christopher Ihlefeld, managing director and portfolio manager at Thornburg Investment Management, tells Dow Jones that “the hockey team has been a real drain on resources” for Glendale.

Now, to be fair, the bond yields remain fairly low – “The longest maturity, in 2033, saw yields go from 3.85% initially to 4.05% in a later pricing” – but if the Coyotes end up moving away at the end of the season, what would investors demand then? According to city spokeswoman Julie Frisoni, there are “hundreds of millions of dollars in economic impact the NHL team brings to the entire region.”

Stay tuned to PHT, your home for all the latest news in the fascinating world of municipal bonds. (Or munis, as we call them around here.)

  1. donttazemebro - Jan 25, 2012 at 5:54 PM

    Glendale and the Coyotes are not long for each other.Its time the NHL drop this insistence that the new owners keep them there.Let them move to a market that wants them and will supports them.

    • elvispocomo - Jan 26, 2012 at 12:28 AM

      They should have done it last year before Glendale committed millions to keep them around another year. Heck, they should have done it before they built the arena in Glendale to begin with. Wold it be going to far back to say Winnipeg never should have been moved there to begin with?

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