Fitch downgrades Washington Prime

Fitch Ratings said it downgraded the ratings of Washington Prime Group, Inc. and its operating partnership, Washington Prime Group, LP, including the long-term issuer default ratings to CC from CCC+.

Fitch also downgraded Washington Prime's senior unsecured bonds to CC/RR4 from B-/RR3, and the downgrade of the company's secured revolving credit facility and term loans to CCC/RR2 from B-/RR3. The improved recovery ratings for the secured revolver and term loans and the weaker recovery rating for the unsecured bonds reflect the recent credit facility amendments that included collateralization of 75% of the $1.3 billion aggregate facility.

The agency also removed the rating watch positive on the revolver and term loans and the rating watch negative on the unsecured bonds and preferred stock as part of these rating actions.

“The CC IDRs reflect Fitch's expectation that an event of default or an exchange/restructuring of existing debt is probable within 12 months. The downgrade also reflects Fitch's belief that the deteriorating operating performance of WPG's mall assets will challenge the company's ability to remain in compliance with existing bond covenants, specifically the unencumbered asset coverage maintenance covenant,” the agency said in a press release.

© 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.