SALT LAKE CITY — One last funding swing to complete the initial construction of Salt Lake City International Airport is all but cleared for takeoff.
Airport officials are preparing to issue more bonds up to $700 million for the final phases of construction, which are on pace to be complete by the end of 2026.
Salt Lake City Council members approved the request last month, setting up a 30-day contest period that included a public hearing on Tuesday. With no objections in the hearing, the airport is closer to heading to the bond market as it plans to do this summer.
“This marks the end of seeking new money for the construction of the airport redevelopment program,” Bill Wyatt, director of the Salt Lake City Department of Airports, told city leaders when he presented them with the proposal in May.
Salt Lake City’s $5.13 billion project to build a new airport began in 2014, leading up to the opening of the old facility in 2020. New gates have opened every year since then as crews race to complete the airport’s A and B concourses. The airport now has 73 gates open, but it will add 10 more gates this fall, and the final 11 gates are on track to be completed by October 2026, according to Brian Butler, the airport’s chief financial officer.
Airport officials estimate they’ll need to sell about $633.5 million in bonds to cover the costs to complete the projects, but they requested up to $700 million to adjust to “all of the volatility in the market,” such as rising and falling interest rates, Butler explained to city leaders in May.
“(If) for any reason interest rates got crazy and went about 6.5%, we just would not proceed with this bond issuance,” he said, noting that the city would also look at 30-40 years maturity on the bonds. The city’s five previous bonds received interest rates ranging from 2.9% to 5.55%.
A backup reserve would help pay for construction costs until the market improves, should the rates exceed the amount airport officials are comfortable with.
The airport should receive bond ratings by mid-July and look at bond pricing toward the end of the month as it looks to pay for the remaining projects. They’re “optimistic” that they can receive an upgrade from the crediting firm Moody’s this year, following ones from Standard and Poor’s and Kroll last year, Butler added.
Officials expect to close on bonds in early August. These types of bonds are often paid off through various airport revenues, such as landing fees, terminal rentals and other fees that airlines pay the airport, as compared to other city bonds that are paid back through property taxes.
Once complete, bonds will account for about three-fourths of the entire construction of the airport’s two concourses, which adds up to about $4 billion worth of debt. Wyatt presented the bonds while city leaders were still piecing together the city’s 2026 fiscal year budget, and he acknowledged that the request was coming at an equally “volatile” time in the market for municipal debt, especially since future budget shortfalls were discussed before the budget was finalized.
“(There’s) not much we can do about that, and even though I’m sure there will be changes here in the short term, I don’t know if they will be significant enough to warrant any changes on our part. But we’re prepared for that,” he said.
Some of the debt is already being repaid, and the airport expects to refinance a portion of its debt beginning in 2027. Wyatt expects that airlines will want a “significant portion” of debt from the initial series of bonds before sinking into future new bonds that would tackle projects like a third concourse that’s in the airport’s master plan.
Barring unforeseen circumstances, airport officials still believe those conversations will pick up more at some point around the mid-2030s.
A record 28.3 million passengers traveled through the airport last year. It also recently landed ninth in the Washington Post’s recent rankings of best airports in the U.S.