Moody’s moves Avison Young view to stable

Moody’s Investors Service said it revised the outlook on Avison Young (Canada) Inc. to stable from positive. Moody’s also affirmed all of Avison Young’s ratings, including its B2 corporate family rating and its B2 senior secured bank credit facility rating.

“The ratings affirmation and outlook revision to stable from positive, reflect Avison Young’s weakened operating performance in the current environment and failure to maintain leverage and coverage metrics post the GVA transaction. The company’s leverage has increased above expectations, with debt to EBITDA at 4.4x for the last 12- month period ended June 30, 2020,” Moody’s said in a press release.

A reduction in business activity and a material decline in leasing and capital markets transaction volumes, including average deal size and tenure, due to the pandemic have hurt Avison’s revenue streams, the agency said. “The potential for continued earnings and revenue erosion due to the deterioration in the macroeconomic environment has increased with the continued spread of the coronavirus and a prolonged recovery into 2021 or beyond could put further pressure on the company’s earnings and weaken leverage ratios above current levels,” Moody’s said.

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