Treasure Island Community Facilities District Bonds Sold for Improvement Area No. 1

Bond proceeds reimburse infrastructure and development costs

This week the City and County of San Francisco priced $17.2 million of Special Tax Bonds for Improvement Area No. 1 of its Community Facilities District (CFD) No. 2016-1 (Treasure Island).  Bond proceeds will be used to reimburse infrastructure and development costs for the Treasure Island/Yerba Buena Island Development Project. This is the first issuance of the Treasure Island CFD's aggregate $5 billion bond authorization, of which Improvement Area No. 1 represents $250 million.

The Bonds are secured by special taxes levied on property located in Improvement Area No. 1, all of which is on Yerba Buena Island (YBI). There is currently one building under construction on YBI, the Bristol, which is currently paying special taxes.  On Wednesday, October 7, 2020 the Bonds were sold via a negotiated sale with an underwriting syndicate led by senior-manager Stifel and co-manager Backstrom McCarley Berry & Co.  The Bonds were well received by the market; receiving orders from 7 unique institutional investors in addition to over 100 individual “retail” investor orders for a total $85 million in orders for the Bonds. Strong investor demand allowed the City to lock in a true interest cost (TIC) of 3.70% for the financing. The Bonds have a final maturity on September 1, 2050. We expect to close this transaction on October 29, 2020.

Improvement Area No. 1 includes ±15.5 acres located on YBI planned for 266 residential units in total; 80 townhomes, 57 flats, 5 single-family homes and a podium building known as The Bristol with 124 condominium units (14 of which will be below-market-rate and not subject to the special tax). YBI is being developed as a joint venture between Wilson Meany and Stockbridge Funds.