Fitch affirms PS Business Parks

Fitch Ratings said it affirmed PS Business Parks, Inc.'s issuer default rating at BBB and $571.9 million preferred stock at BBB-.

The outlook is stable.

The BBB ratings revolve around the cash flows generated by the company's flex, industrial and office property portfolio in excess of its fixed charges, which are predominantly preferred stock dividends, the agency said.

Ratings further reflect the company's ample unencumbered asset coverage of preferred stock, strong liquidity position, limited debt and minimal refinance risk, and solid risk-adjusted capitalization, the agency noted.

The affirmation takes into account Fitch's view that ongoing pressure on rent rollovers will drive down same-park net operating income by mid-single digits in 2010 and low-single digits in 2011, though fixed-charge coverage is not expected to weaken materially, the agency said.

Leverage as measured by net debt plus 25% of preferred stock to recurring operating EBITDA was strong at 0.2x as of March 31.

Ratings also capture the high geographical focus and relatively small size of the portfolio, the agency noted.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.