Moody's Upgrades Globalworth Real Estate After Expansion Into Poland

LONDON (Alliance News) - Moody's Investor Service on Friday last week upgraded Globalworth Real ...

Alliance News 15 April, 2019 | 3:38PM
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LONDON (Alliance News) - Moody's Investor Service on Friday last week upgraded Globalworth Real Estate Investments Ltd's rating to Baa3 from Ba1 with a stable outlook following Polish expansion.

Moody's also upgraded the ratings for Globalworth's EUR550 million senior unsecured notes due 2022, and its EUR550 million medium term notes maturing 2025, to Baa3 from Ba1.

The company's outlook was also changed to stable from positive.

Moody's Associate Vice President Analyst Ana Luz Silva said: "The upgrade to Baa3 with a stable outlook reflects an improved business profile supported by Globalworth's successful expansion of its real estate operations into Poland, a market benefiting from a positive economic environment and strong property market fundamentals.

"Overall the premium quality of its office portfolios in Poland and Romania continues attracting international blue chip tenants and provides for sustained robust operating performance in both geographies. Moreover the company is committed to maintain an equally strong financial profile in order to sustainably continue with its growth strategy, even in potentially more difficult times."

Moody's said the long term issuer rating was reflective of Globalworth's leading premium office market position in Poland and Romania, a robust tenant base with a reasonably long average lease term with a high occupancy rate, and its "solid credit metrics". Good liquidity was also a factor in the rating.

These strengths were, however, somewhat offset by the execution risk introduced by Globalworth's continuing fast-paced growth through developments and acquisitions, as well as Globalworth's short track record.

Other offsetting factors included Globalworth's "still high exposure" to the Romanian market, which represents 49% of its standing gross asset value; its large but controlled development programme; and some debt maturities that will require refinancing.

Of the stable outlook rating, Moody's said it: "reflects Moody's expectation that the company will continue featuring a solid business profile supported by a balanced growth strategy. The outlook also reflects an expected unchanged favourable operating environment in both Poland and Romania over the next 12 to 18 months, as well as Moody's expectation the company will maintain credit metrics commensurate with a disciplined financial policy committed to an investment grade rating."

Shares in Globalworth were up 0.6% at EUR9.20 on Monday afternoon.

By Anna Farley;

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Securities Mentioned in Article
Security Name Price Change (%) Morningstar Rating
Globalworth Real Estate Investments Ord 9.00 EUR 0.28 -
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