Fitch: Mid-America notes BBB

Fitch Ratings said it assigned a BBB rating to Mid-America Apartments, LP’s $400 million 3.75% senior unsecured notes.

The notes mature in June 2024 and were priced at 98.873% of their face amount to yield 3.887%, representing a 125 basis-point spread over the benchmark treasury, Fitch said.

The notes are obligations of Mid-America Apartments and fully and unconditionally guaranteed by Mid-America Apartment Communities, Inc., the agency said.

The proceeds will be used to repay borrowings under its $200 million secured credit facility with the Federal Home Loan Mortgage Corp., all of the borrowings under its $500 million revolving credit facility and for general corporate purposes.

Mid-America Apartment Communities has an issuer default rating of BBB.

Mid-America Apartments has an issuer default rating of BBB, unsecured revolving credit facility rating of BBB, senior unsecured term loans rating of BBB and senior unsecured notes rating of BBB.

The outlook is positive.

The ratings are driven by moderate leverage and strong coverage of fixed charges, combined with the company’s strong management team and long-term track record of generating above-average cash flow returns from its stabilized property portfolio, Fitch said.

Further, the group’s portfolio diversity and competitive position in the Sunbelt region should continue to support stable operating performance over the next few years, the agency said.

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