KBRA assigns a long-term rating of AA+ to the City of Atlanta, Georgia Airport General Revenue Bonds, Series 2025A (Non-AMT) and Series 2025B (AMT) issued for Hartsfield-Jackson Atlanta International Airport. Concurrently, KBRA affirms the long-term rating of AA+ assigned to outstanding General Airport Revenue Bonds and Passenger Facility Charge (PFC) Subordinate Lien Airport General Revenue Bonds. The Outlook on all debt is Stable.

Airport General Revenue Bonds (GARBs) are secured by a pledge of net General Revenues, while the Airport Passenger Facility Charge (PFC) and Subordinate Lien Revenue Bonds (Hybrid PFC Bonds) are secured by a senior lien on PFCs and a subordinate lien on net General Revenues. KBRA makes no rating distinction between the GARBs and Hybrid PFC Bonds given the strength of debt service coverage on both liens and the subordinate pledge of airport net revenues available to pay Hybrid PFC debt service, if needed. As of June 30, 2024, approximately $2.1 billion and $1.4 billion of GARBs and Hybrid PFC Bonds, respectively were outstanding.

Key Credit Considerations

The rating actions reflect the following key credit considerations:

Credit Positives

• Expansive, vibrant and economically diverse air trade area generates strong demand for air travel.
• Robust utilization, in part driven by an advantageous geographic location and physical layout that economically supports Delta Air Lines’ largest connecting hub operations.
• Healthy financial performance and debt service coverage, with considerable capacity to absorb planned debt issuance related to the ATLNEXT capital program.

Credit Challenges

• Significant financial and operational reliance on Delta and its regional partners, though mitigated by Delta’s favorable financial position and the critical nature of the Airport to the carrier’s network operations.
• Continued high, though moderating, dependence on connecting traffic which exposes the Airport to the operating needs and decisions of the airlines rather than local market forces.
• Various risks associated with implementing a large, multi-phase capital plan including an expected significant increase in leverage.

Rating Sensitivities

For Upgrade:

• Completion of ATLNEXT projects on-time and on-budget, with financial metrics exceeding forecast.

For Downgrade:

• While a remote prospect, the permanent loss in passenger volumes leading to non-competitive airline costs, impaired liquidity and materially weakened debt service coverage.
• Material increases in ATLNEXT costs beyond current estimates, resulting in heightened leverage and weakened debt and financial metrics

To access ratings and relevant documents, click here.

Methodologies

• Public Finance: U.S. General Airport Revenue Bond Rating Methodology
• ESG Global Rating Methodology

Disclosures

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

Doc ID: 1010924

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