S&P downgrades iStar

Standard & Poor's said it lowered its ratings on iStar Financial Inc., including lowering the long-term counterparty credit rating to BBB- from BBB, and removed the ratings from CreditWatch negative, where they were placed Oct. 14.

The outlook is negative.

The agency said the action reflects the significant increase in iStar's troubled loans and potential funding pressure if slower loan repayments inhibit iStar's ability to fund commitments or pay down debt maturities.

Fitch added that despite deterioration in the firm's portfolio and cracks emerging in broader CRE markets, iStar appears to be in a better position than many of its competitors. Its capitalization remains adequate, its management has consistently maintained sound underwriting standards and it retains the expertise to manage operations at troubled properties, the agency said.

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