Following a comprehensive review of its financial profile that was completed earlier this month, the Norfolk Airport Authority has received an upgraded credit rating from Moody’s Ratings, one of the world’s leading credit rating agencies. The new A2 rating could bring significant cost savings with future debt issuances as the Authority enhances and expands Norfolk International Airport under its current $1 billion TransformORF capital program.
“Anyone who has ever borrowed money to make an expensive purchase understands the value of lower debt payments, and your credit rating greatly influences those costs,” said Mark Perryman, the Authority’s President and Chief Executive Officer. “As we embark on what will be the largest capital program in ORF’s nearly 90-year history, the timing of this upgraded rating is noteworthy. We’ll continue our efforts to develop the airport in a responsible manner by reducing costs to travelers and our business partners wherever we can reasonably achieve such savings.”
The Authority’s rated airport revenue bonds moved up from their prior A3 rating thanks in part to continued growth in passenger traffic at ORF immediately following the pandemic. The airport, which serves as the primary aviation gateway to the 1.8 million-resident Virginia Beach-Chesapeake-Norfolk, VA-NC Metro Area, is on pace to serve more than 4.9 million passengers in 2024, marking a third-consecutive annual record for air traffic. In addition to a thriving tourism base that includes Hampton Roads, Virginia’s Eastern Shore and North Carolina’s Outer Banks, the region’s proximity to continuous military and government-related activities brings added stability against the up-and-down economic cycles other communities may experience.
Moody’s analysts also noted a new use and lease agreement with airline partners enhanced the Authority’s financial profile in 2024 by increasing revenues, as did a broadened mixture of full-fare and low-cost airlines and additional destinations available at ORF. Recent efforts to build additional cash reserves also factored into the upgraded rating, they said.
