S&P upgrades Prologis, debt, preferreds

S&P said it raised its corporate credit rating on Prologis Inc., Prologis LP, Prologis, and PLD International Finance Inc. to A- from BBB+.

The outlook is stable.

The agency also upgraded its issue-level rating on the company's senior unsecured debt to A- and its preferred stock to BBB.

"The upgrade reflects our view that Prologis' will maintain its consistent strategic execution in the global logistics real estate segment, supported by currently solid industrial and e-commerce fundamentals, in the coming years and that leverage will be around 6x," S&P credit analyst Robert Schulz said in a news release.

"We recognize the recently increased uncertainty surrounding the global trade landscape including BREXIT, a rebalancing China economy, and potential U.S. trade policy shifts. We think Prologis' portfolio is sufficiently well rented and diversified to adapt to potential evolutions in trade flow and demand dynamics. We don't think the e-commerce tailwind (from which a portion of the company's business has benefited) will reverse anytime soon, even if the growth rate moderates.

“Prologis' financial policies have supported debt reduction, and we think this approach will continue, with leverage under our calculation remaining around 6x in 2017 and beyond."

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