Moody’s trims Yeuxiu Real Estate

Moody's Ratings said it downgraded Yuexiu Real Estate Investment Trust’s corporate family rating to Ba2 from Ba1 and to (P)Ba2 from (P)Ba1 the backed senior unsecured rating on Yuexiu REIT MTN Co. Ltd.'s backed medium-term note program, and to Ba2 from Ba1 the backed senior unsecured rating on the backed MTNs issued under the MTN program.

The outlook remains negative.

"The rating downgrade and negative outlook reflect our expectation that Yuexiu REIT's credit metrics will stay weak, particularly its high debt leverage, at levels that are not commensurate with its previous rating given the challenges it faces to deleverage amid China's slowing economy and weak office rental market," said Kelly Chen, a Moody's vice president and senior analyst, in a press release.

The agency said it estimates the REIT's debt leverage, as measured by net debt/EBITDA, will linger at around 14x over the year, compared with 14.2x for 2023.

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