Moody's Assigns Aa1/VMIG 1 Rating to Ohio Housing Finance Agency Multifamily Housing Revenue Bonds

Strategic Insights -

Moody's Investors Service has assigned a rating of Aa1/VMIG 1 to the proposed $7.335 million Ohio Housing Finance Agency Multifamily Housing Revenue Bonds Series 2025A (Seton Square Portsmouth Apartments Project). The rating is based on the strong structural framework and high credit quality of the investments securing the bonds. The bond funds are expected to generate revenues to cover bond debt service through investments in Eligible Investments.

Key Takeaways:

  • The Aa1 long-term rating is based on the strong structural framework and high credit quality of the investments securing the bonds, which are expected to generate revenues to cover bond debt service.
  • The VMIG 1 short-term rating is based on cash flow projections that demonstrate sufficient funds for full and timely debt service payments to but not including the mandatory tender date, currently expected to be on 7/1/2027.
  • The structural framework is designed to prevent bond proceeds from being disbursed to the borrower, Seton Square Portsmouth Limited Partnership, unless an equal or greater amount is deposited to the collateral fund.
  • The reasoned bankruptcy opinion provided by Squire Patton Boggs (US) LLP identifies mitigants to preference and automatic stay risks associated with a bankruptcy filing of Seton Square Portsmouth Limited Partnership.
  • The principal methodology used in these ratings was US Pre-refunded and Escrow-backed Transactions, published in October 2024, and available at https://ratings.moodys.com/rmc-documents/430703.

Statistics:

  • $7.335 million: the proposed amount of the Ohio Housing Finance Agency Multifamily Housing Revenue Bonds Series 2025A.
  • Aa1: the long-term rating assigned by Moody's to the bond.
  • VMIG 1: the short-term rating assigned by Moody's to the bond.
  • 7/1/2027: the anticipated mandatory tender date.

Sources:

  • Moody's Investors Service: [1]
  • US Pre-refunded and Escrow-backed Transactions, published in October 2024: [2]
  • https://ratings.moodys.com/rmc-documents/430703: [3]
  • https://ratings.moodys.com: [4]
  • Squire Patton Boggs (US) LLP: [5]