Dec 04 - In a newly published special report, Fitch Ratings says that European REITs now have well-matched lease and debt maturity profiles and that this strategy should protect their credit ratings in 2013 and beyond.
European REITs have significantly increased the length of their debt maturity profile through bond issues since 2009, and this ensures their long-term income producing asset portfolios are matched with similar length debt maturities. European REITs are now in a strong position to resist shocks, such as further reductions in bank lending and general interest rate rises.
Average leverage, as measured by net debt/EBITDA, has risen since 2009, but is expected to stabilise in 2013. This trend is underpinned by a high level of protection against both interest and currency movements. This has been achieved mainly by issuance of fixed coupon senior unsecured bonds, which now represent the sector’s main source of funding (around 75% at June 2012). This trend is expected to continue in 2013.
European REITs reviewed in this report include the British Land Company Plc, Hammerson Plc, Land Securities Group Plc, SEGRO Plc, Atrium European Real Estate Ltd, Global Switch Holdings Ltd, PSP Swiss Property AG and Unibail-Rodamco SE.
The full report, entitled ”European REITs-Assets and Liabilities Well
Matched” is available at www.fitchratings.com.
Link to Fitch Ratings’ Report: European REITS â€“ Assets and Liabilities Well Matched