Moody’s lowers Yuexiu REIT view to negative

Moody's Investors Service said it changed the outlook on Yuexiu Real Estate Investment Trust's (Yuexiu REIT) Baa2 issuer rating to negative from stable.

Moody's also said it changed the outlook on Yuexiu REIT MTN Co. Ltd.'s ratings to negative from stable.

The agency also affirmed Yuexiu REIT's Baa2 issuer rating, Yuexiu REIT MTN's provisional Baa2 senior unsecured medium-term notes program rating and the Baa2 senior unsecured debt rating on the notes issued under the program.

The negative outlook reflects Yuexiu REIT's high debt leverage for its Baa2 issuer rating, Moody’s said.

Yuexiu REIT's debt leverage is expected to be between 9x and 10x over the next 12- to 18-months in the absence of any successful issuance of new equity to reduce its debt levels, the agency said.

But while Yuexiu REIT's debt leverage is high, it has a well-managed debt-maturity profile, Moody’s said.

The company demonstrated a lack of short-term debt and held adequate cash to address its immediate cash needs, the agency added.

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