Moody's cuts Forest City

Moody's Investors Service said it lowered the senior unsecured debt ratings of Forest City Enterprises, Inc. to B3 from B1.

The outlook is negative.

The action was driven by the continuing weakness in Forest City's credit metrics, particularly its fixed charge coverage and net debt-to-EBITDA ratio at 16.8x in the first quarter, as well as by persistent challenges in both the real estate market and the credit environment, according to the agency.

The rating reflects the slowdown in Forest City's core portfolio performance in tandem with the broad economic deterioration, Moody's said.

Forest City's portfolio continues to benefit from well-laddered lease expirations and no significant tenant exposures, the agency noted.

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