Moody's downgrades Demire

Moody's Investors Service said it downgraded Demire Deutsche Mittelstand Real Estate AG's long-term corporate family rating to Caa1 from B3 and the rating on its notes due in October 2024 to Caa2 from Caa1.

“The downgrade to Caa1 reflects increased refinancing risk following the withdrawal of the buyer of Demire's LogPark logistics property from the purchase agreement. The disposal of LogPark is a key component of Demire's effort to increase liquidity sufficiently to address the roughly €500 million remaining senior unsecured bond maturity in October 2024 and around €150 million secured debt maturing during 2024.

“The downgrade also reflects a continued weak business environment for real estate landlords in Germany that makes disposals more difficult and getting new secured debt more costly and difficult, combined with less time available to generate sufficient liquidity to facilitate a bond repayment,” Moody’s said in a press release.

The outlook remains negative.

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