Fitch: Duke Realty notes BBB-

Fitch Ratings said it assigned a credit rating of BBB- to the $250 million aggregate principal amount of 3.625% senior unsecured notes due 2023 issued by Duke Realty LP, the operating partnership of Duke Realty Corp.

The notes were issued at 99.179% of par and priced to yield 3.723% over the benchmark rate.

The proceeds will be used to repay outstanding indebtedness with near-term maturities, including all or a portion of outstanding borrowings under its existing revolving credit facility and for other general corporate purposes.

Duke Realty Corp. has an issuer default rating of BBB- and BB rating on its $448 million preferred stock rating.

Duke Realty LP has an issuer default rating of BBB-, along with a BBB- rating on its $850 million unsecured revolving credit facility and BBB- rating on its $3.2 billion senior unsecured notes.

The outlook is stable.

The ratings take into account Duke's leverage, large pool of diversified industrial, office and medical office properties, strong access to various forms of capital and adequate unencumbered asset coverage of unsecured debt, Fitch said.

These credit strengths are tempered by challenging suburban office fundamentals, low fixed-charge coverage, increased development activity that weighs on liquidity and execution risk tied to projected asset sales over the near term, the agency said.

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