Press Release Details
Rating Action: S&P upgrades SL Green Realty Corp. Upgraded To 'BBB-'; Outlook Stable
At the same time, S&P affirmed its 'BBB-' unsecured issue-level ratings and withdrew the '2' recovery rating.
"The upgrade reflects S&P's expectation that SL Green will use proceeds
from asset sales to repay debt and continue to benefit from modest
demand and disciplined supply growth in the
The stable outlook reflects S&P's expectation that SL Green will
continue to use asset sale proceeds to reduce debt. In S&P's view, the
company's competitively positioned, high quality N.Y. office portfolio
is supported by strong occupancy levels, good quality tenants, and still
favorable supply/demand dynamics, which will support improving financial
leverage and
S&P would lower ratings if operating performance deteriorates perhaps
because of considerable weakness among tenants in the financial and
legal sectors or if leverage does not improve with debt to EBITDA
remaining above 9.5x or
Although less likely, S&P could raise the rating if the company significantly reduces debt, and continues to outperform similarly sized peers as evidenced by occupancy and rental rate growth resulting in fixed-charge coverage measures in the high 2x area and debt to EBITDA of less than 7.5x on a sustained basis.
-
On
Jan. 27, 2016 ,New York based REIT,SL Green Realty Corp. reported a 4.6% increase in 2015 same-property net operating income (NOI) and occupancy levels improved to 97.1% in its coreManhattan office portfolio.
-
The company also announced that Citigroup, Inc. exercised its option
to purchase
388-390 Greenwich Street for$2 billion , which is expected to close inDecember 2017 .
- S&P is raising its corporate credit rating on SL Green to 'BBB-' from 'BB+'. At the same time, S&P affirmed its 'BBB-' unsecured issue-level ratings.
-
The stable outlook reflects S&P's expectation that SL Green will
continue to use asset sale proceeds to reduce debt. In S&P's view, the
company's competitively positioned, high quality N.Y. office portfolio
is supported by strong occupancy levels and good quality tenants,
which will support improving financial leverage and
FCC over the next 12 to 18 months.
RELATED CRITERIA AND RESEARCH
Related Criteria
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And Assumptions: Liquidity Descriptors For Global Corporate Issuers,
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Credit Factors For The Real Estate Industry,
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Methodology: Ratios And Adjustments,
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Risk,
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Methodology,
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And Governance Credit Factors For Corporate Entities And Insurers,
2008
Corporate Criteria: Rating Each Issue,
Certain terms used in this report, particularly certain adjectives used
to express our view on rating relevant factors, have specific meanings
ascribed to them in our criteria, and should therefore be read in
conjunction with such criteria. Please see Ratings Criteria at www.standardandpoors.com
for further information. Complete ratings information is available to
subscribers of RatingsDirect at www.globalcreditportal.com
and at www.spcapitaliq.com.
All ratings affected by this rating action can be found on
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