Fitch downgrades Lippo Malls Indonesia

Fitch Ratings said it downgraded Lippo Malls Indonesia Retail Trust's (LMIRT) long-term issuer default rating to B from B+ and its senior unsecured notes due 2024 and 2026 to B/RR4 from B+/RR4. The notes were issued by its wholly owned subsidiary, LMIRT Capital Pte. Ltd.

“The downgrade reflects our expectation that LMIRT's funds from operation (FFO) fixed-charge cover will fall to around 1x-1.1x in the next 12-18 months, which will no longer be commensurate with a higher rating. A slow recovery in the trust's operating cash flow and high exposure to rising interest rates underpins our forecast,” the agency said in a press release.

The outlook is stable.

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