Moody’s eyes Yuexiu for downgrade

Moody’s Investors Service said it placed Yuexiu Real Estate Investment Trust's Baa3 issuer and medium-term note ratings on review for downgrade. The agency also placed the MTN program’s (P) Baa3 rating on review. Before the review, Yuexiu’s outlook was negative.

"The review for downgrade reflects the weaker-than-expected operating performance of Yuexiu REIT and the uncertainties over whether the company's operational recovery and deleveraging efforts are sufficient to improve its credit profile to a level supportive of its current Baa3 issuer rating," said Alfred Hui, a Moody's analyst, in a press release.

The agency said it will assess Yuexiu's ability to substantially ramp up its operations, lower its debt leverage and lower its interest costs in view of the high offshore interest rate environment.

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