S&P rates FREIF NAP loans BB-

Standard & Poor’s said it assigned preliminary BB- ratings and preliminary 2 recovery ratings to FREIF NAP I Holdings III LLC’s $250 million senior secured term loan B due 2022 and $45 million senior secured funded letter-of-credit term loan due 2022.

The 2 recovery rating indicates 70% to 90% expected default recovery.

The stable outlook is based on an expectation of satisfactory operational performance and continued cash-flow stability due to the contracted nature of the portfolio’s assets, S&P said.

The ratings reflect the bank’s moderately high debt leverage, some re-contracting risk for the newly acquired assets, some refinancing risk when the term loan matures and the structural subordination of NAP I’s debt, the agency said.

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