Want to Learn More about P3? DeveloP3rs is Here to Help!
Who is DeveloP3rs?
DeveloP3rs is a division of Blue Rose Capital Advisors, who recognizes the strategic value of Public-Private Partnerships (“P3s”) and is poised to deliver value to its clients with vigorous, robust guidance throughout the evaluation, pursuit, and implementation of P3 transactions.
At Blue Rose we strive to provide sophisticated financial advisory services, and as an extension of those services or on a special advisory basis, we add tremendous value in the delivery of independent evaluation, negotiation, and execution of P3s. Consistent with our debt and derivatives advisory services, we maintain an unbiased, holistic, and independent approach in the consideration of the institutional impact of available P3 solutions.
How to Learn More
DeveloP3rs will be hosting our first informational meeting in just two weeks. Please consider joining us for lunch at the Edina Country Club in Minnesota and learn about P3/ Project Finance from an amazing lineup of local industry professionals on March 10, 2020. This lunch and learn is geared toward helping you learn about alternative financing approaches such as P3 and Project Finance and to help you develop a plan your CFO and banking partners will approve.
We are excited to have local legal counsel, construction, and financial advising professionals presenting on:
What is a P3? What is Project Finance?
State of the Market Around the RegionMarket Demand Study (% Occupancy and Competing Housing)
Peer Institution Analysis (Higher Education Rents /Enrollments)
Constructions Costs ($/Square Ft, $/Bed, Programming)
Cashflow Model (Revenues, Expenses 1.25x Debt Service Coverage)
Financing Structures (501c3, 100% Equity, Exempt from Property Taxes)
Legal Issues (Institutional Procedures, Approvals, Indentures)
Timeline (Development, Financing, Construction)Operations
Operations (Self Manage or 3rd Party Management Company)
To see who will be presenting and to RSVP for this event, please visit our website. We hope to see you there!
Can’t Make It This Time? No Problem!
DeveloP3rs is expecting to host additional events throughout the country in 2020. Our next lunch and learn event is anticipated for May 2020, in Chicago. To be put on our mailing list for this event, please visit our website and fill-out our contact form.
DeveloP3rs Advisory Team Johan Rosenberg, Chairman 952-746-6030 firstname.lastname@example.org Johan Rosenberg is the General Partner of TRIL 1 LP, a holding company that owns a number of companies, including Blue Rose Capital Advisors, HedgeStar, and MPT Services. In addition to company management, Johan provides advice on capital markets transactions, the execution of public private partnerships, and the accounting treatment of complex financial instruments. Justin Krieg, Vice President 952-746-6045 email@example.com Justin Krieg, Ph.D., Vice President, joined the TRIL companies, in 2018. Dr. Krieg provides financial and economic consulting services to the firm’s clients. Within the firm’s P3 Advisory Practice, Dr. Krieg utilizes his knowledge and experience to assist clients in understanding the P3 approach to procurement, determining the appropriateness of the range of delivery methods, and ensuring that the long-term P3 partnerships rest on a secure financial and economic foundation.
About the Author:
Megan Roth joined Blue Rose Advisors in June 2019 as a Marketing Generalist. Prior to working at Blue Rose, Ms. Roth held internships with the Mason Companies Inc, Mayo Clinic Health System, and Chippewa Valley Post. Through these positions she managed social media strategies, assisted with marketing research and help strengthen external and internal communication through the organizations.
Ms. Roth holds a Bachelor of Arts degree in Organizational Communication with a minor in Marketing from the University of Wisconsin -- Eau Claire.
To contact Ms. Roth, please email firstname.lastname@example.org
Comparable Issues Commentary
Shown below are the results of two negotiated, tax-exempt private higher education issues that sold in February. Lawrence University (“Lawrence”) and Arcadia University (“Arcadia”) priced their Series 2020 bond issues on February 25th and February 6th, respectively. The two deals were sized similarly, each selling between $14M and $20M of total par. Lawrence’s bonds were rated Baa1 by Moody’s while Arcadia’s bonds were rated BBB by S&P. Both schools issued bonds with a refunding component, with Lawrence refinancing its Series 2012 bonds as well as a 2014 direct placement, while Arcadia refunded its Series 2010 bonds. Lawrence’s deal also included $2 million of new money issuance.
Arcadia’s transaction priced on a stable day in the market, with MMD unchanged across the entirety of the yield curve. In contrast, Lawrence priced its bonds during a week in which interest rates dropped significantly due to growing concerns related to the coronavirus – while MMD dropped by just 1-3 bps across the curve on the 25th, these drops came on the heels of reductions of 7-16 bps in total over the previous two days, indicative of the significant volatility of the market during Lawrence’s week of sale. However, municipal bond inflows remained high due to a “flight to quality” from investors, resulting in positive pricing results for borrowers without significant expansion of credit spreads due to strong market demand.
Arcadia’s bond issue was fully serialized through its final maturity in 2039. In contrast, Lawrence’s bond issue utilized several term bonds in the 10-25-year maturities. This was primarily due to the University’s use of a deferred principal amortization structure, which resulted in annual principal payments of $75,000 or less from 2031 to 2040 after which principal amortization increased to roughly $2M/year through the 2045 final maturity. These structural differences also drove differences in couponing between the two deals, with Arcadia opting to sell 5% coupons through 2034 with 4% coupons thereafter in 2035-2039 while Lawrence used a more diversified approach. Lawrence’s 2035 and 2037 term bonds, both relatively small in size, were priced with 2.125% and 2.25% discount coupons, while later terms in 2040, 2042, and 2045 were sold carrying 3% and 4% premium coupons. Both universities priced their deals with a standard 10-year par call option.