The New Jersey Educational Facilities Authority and Princeton University have appointed certified minority business enterprise Ramirez Asset Management as a subadvisor on the proceeds of the university’s Series 2021B and 2021C bonds.
The appointment marks the first time the 54-year-old authority has collaborated with an investment manager — PFM Asset Management — and a client to ensure that a minority, woman or veteran-owned firm invests and manages bond proceeds.
NJEFA project management director Steve Nelson said the authority has previously worked with Ramirez as an underwriter. “We are pleased to be working with the firm in this new line of business,” he said.
The bonds, sold competitively with a combined aggregate par value of roughly $430 million, closed on April 8. They represent the 54-year-old authority’s largest transaction, eclipsing its Princeton Series 2017-I issue of $357 million.
According to a university official, Ramirez will manage half the bond proceeds.
Princeton president Christopher Eisgruber, in a letter to faculty, staff and students last September, highlighted a goal of diversifying its external investment managers.
“This is a major milestone for Princeton University and for the New Jersey EFA,” said Tim Graf, the Ivy League institution’s vice president for treasury services.
The EFA is New Jersey’s primary issuer of municipal bonds to finance the development of public and private colleges and universities.
Series 2021B bond proceeds will finance costs of the acquisition, construction, renovation and installation of certain capital assets on or near Princeton’s main campus; its Forrestal Campus in Plainsboro; and its administrative building at Carnegie Center in West Windsor and lake campus, both in West Windsor.
These projects involve renovation of buildings and other facilities; land acquisition; and the refunding of some or all of the authority’s Princeton University Series 2018A and 2020A commercial paper notes, the latter tax-exempt; and the refunding of a portion of The Trustees of Princeton University taxable commercial paper notes.
Princeton used the Series 2021C, bonds to finance the current refunding and defeasance of all or a portion of outstanding Series 2011B bonds.
Morgan Stanley was lead manager for that sale, which S&P Global Ratings and Moody’s Investors Service rated triple-A.
“Rigorous strategic and financial planning support credit quality as well as ongoing prospects for consistently positive operating results and ample liquidity,” Moody’s said in a presale report. “These factors provide flexibility for the university to manage through a period of uncertainty driven by the coronavirus pandemic.”
Ramirez Asset Management, founded in 2002, is an affiliate of Ramirez & Co., one of the oldest Hispanic-owned full-service investment firms in the U.S.