Fitch upgrades California regional airport ahead of bond sale

Fitch Ratings upgraded Ontario International Airport Authority, California’s outstanding $103 million airport revenue bonds to A-plus from A-minus on Wednesday ahead of its plans to price debt the week of Oct. 19.

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Ontario International Airport (ONT) is a predominantly origin-and-destination medium-hub, serving as a secondary airport in the competitive southern California market.

Fitch also assigned an A-plus rating to OIAA’s $175.8 million airport revenue bonds, series 2026A and 2026B.

The outstanding bonds were removed from rating watch positive by Fitch and the outlook was revised to stable.

The upgrade “reflects rapidly strengthening financial performance from robust enplanement growth and a new airline use and lease agreement,” according to Fitch.

ONT is well-positioned because of its location in the growing Inland Empire, which includes Riverside and San Bernardino counties, according to Fitch.

The Ontario International Airport Authority announced in a Sept. 28 disclosure statement posted on the Municipal Securities Rulemaking Board’s EMMA website it was evaluating plans to issue roughly $50 million of fixed rate tax-exempt airport revenue bonds Series 2026A (non-AMT) and roughly $125 million of fixed rate tax-exempt airport revenue bonds Series 2026B (AMT).

If, and when issued, the Series 2026 bonds are expected to provide funds to pay and/or reimburse the authority for the costs of certain capital improvements at the airport, repay all or a portion of the authority’s subordinated revenue notes, Series 2025 tax exempt bonds, fund capitalized interest on all or a portion of the Series 2026 bonds, make a deposit to the debt service reserve fund, and pay the costs of issuance of the Series 2026 bonds.

The transaction is expected to price the week of October 19 through a syndicate led by BofA Securities, Inc., as book-running senior manager, according to the disclosure filing.

The airport reported on Sept. 26 that a 31% surge in international travel pushed passenger volumes to almost 4.7 million over the first eight months of the year — up 0.3% from the year before.

ONT served more than 450,000 international fliers during the first eight months of the year, reflecting an increased number of flights to Taiwan and Mexico, according to airport officials. For the month of August, they said, the southern California gateway welcomed 606,000 air travelers, down 6.2% from August 2025 as airlines reduced capacity due to higher fuel prices.

“Ontario International continues to strengthen its position as Southern California’s airport of choice, and the tremendous growth we’re seeing in international travel is especially exciting,” Atif Elkadi, chief executive officer of the airport authority said in a statement. “Travelers are choosing ONT for the convenience and ease we offer, the quality of our facilities and amenities, and a customer experience that ranks among the very best in North America.”

“That combination continues to distinguish Ontario in an increasingly competitive aviation market,” he said.

The airline use and lease agreement allows the airport to retain a portion of net ground transportation revenue and all revenue from onsite real estate development.

Fitch resolved the positive outlook following the release of a detailed multiyear capital improvement plan and debt issuance plans.

These plans indicate recent financial improvements will be maintained at a level consistent with the upgrade, despite planned new-money debt issuance. A third-party feasibility study also provided greater clarity on the benefits of the airport’s new airline use and lease agreement, according to the rating agency.

The airport experienced severe enplanement losses following the Great Recession, according to Fitch, which views the circumstances and location during that period as unique; the airport is unlikely to experience similarly outsized losses in future economic cycles.

Southwest accounts for one-third of enplanements, according to Fitch.

But Fitch said, Ontario “has a strong cargo aviation position, supported by the region’s large logistics sector, with air cargo representing over half of landed weight, providing revenue diversification. The airport also benefits from lease revenue from on-site private development, which includes long-term rate escalators.”