Chicago suburb's bond rating cut to junk
over stadium debt
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[April 01, 2017]
CHICAGO (Reuters) - The credit
rating for Bridgeview, Illinois, fell into the junk level on Friday
after S&P Global Ratings hit the Chicago suburb with a four-notch
downgrade to BB-minus.
S&P cited debt pressures on Bridgeview, which issued $135 million of
general obligation (GO) bonds in 2005 for a stadium that it owns and
"The downgrade reflects our view that the village will continue to face
acute business, financial, and economic uncertainties related to its
debt burden, particularly the debt issued for its Toyota Park stadium,"
S&P analyst Blake Yocom said in a statement.
S&P placed the junk rating on a watch list for a possible further
downgrade due to concerns over potentially reduced market access and
weakened liquidity for Bridgeview.
Steve Landek, Bridgeview's mayor, said he believed the downgrade was
triggered by a plan the suburb was considering to restructure $24.5
million of variable-rate bonds to a fixed-rate mode with a 2047
maturity. He said Bridgeview would come up with a better plan over the
next 90 days.
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The credit rating agency said it expects Bridgeview, which has used
restructurings in the past to ease debt service payments and
minimize property tax hikes, to continue the practice, possibly
pushing bond maturities out to years beyond the useful life of the
It added that the "underperforming" stadium has left the suburb with
an "extremely high" GO debt burden that totals about $256 million
and "very weak" liquidity.
With seating for as many as 28,000, Toyota Park, which opened in
2006, hosts soccer games, concerts and other events in the village
of 17,000 located southwest of Chicago.
(Reporting by Karen Pierog; editing by Lisa Shumaker)
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