Fitch Ratings has affirmed the Port of Oakland’s (Port) bond ratings and revised the Port’s ratings outlook from stable to positive.
Fitch affirmed the following ratings on Port of Oakland debt:
• A for intermediate lien revenue bonds; and
• A for the underlying bank bond rating for the Port’s commercial paper notes.
“These bond ratings reflect the Port’s unwavering commitment to prudent financial management and stability,” said Port of Oakland Chief Financial Officer Julie Lam. “They are a testament to the dedication and professional excellence of our Port staff and the Oakland Board of Port Commissioners.”
According to Fitch, the positive outlook reflects the Port's diverse revenue streams from aviation, maritime, utilities, and commercial real estate operations, bolstered by stable operational performance. The bond ratings are further supported by the passenger traffic base at San Francisco Bay Oakland International Airport (OAK or Airport), which offers many non-stop flights to specific destinations and serves as a medium-to-large hub in a competitive market.
Long-term contracts at the Oakland Seaport (Seaport) have also played a crucial role in stabilizing the Port's financial position. Fitch stated that the Port’s leverage metrics for financing assets and its ability to cover debt-related payments are strong.
Key drivers, cited by Fitch, for the change in the Port’s ratings outlook include the strength of the Port’s revenue base, a manageable capital plan, a strong financial profile, and a sound debt structure.
The Port of Oakland is constantly reviewing and assessing its assets and operations to improve its facilities at the Airport and Oakland Seaport (Seaport) in a dynamic global market.
The Port looks to expand and enhance new business opportunities to support the regional economy while maintaining responsible fiscal stewardship. Thanks to strong fiscal management, the Port can move forward on important capital investment projects. These projects will improve Port facilities and infrastructure, help the Port retain existing customers, attract new business, and build revenue streams.
There are immediate capital plans to enhance the customer experience at OAK, invest in aviation and maritime infrastructure projects, and support initiatives aimed at achieving zero-emissions goals at both the Airport and Seaport.
Some of the most visible changes travelers can see at the Airport are new retail and food and beverage offerings that provide OAK travelers with more options. The Port is also investing in infrastructure upgrades designed to improve the overall passenger experience within terminal buildings.
Investment in electrification of Port and tenant businesses is a priority to reach zero-emissions operations. The Port will be a key investor and partner for major electric infrastructure projects that will enhance power system reliability and provide added peak capacity at both the Airport and Seaport when user demand is high.
At the Seaport, many projects are being planned, getting underway or have been completed. The Port is investing in better roadways, improving maritime dock infrastructure, and evaluating a harbor plan for making it safer and more efficient for big ship navigation.
