S&P stabilizes Service Properties view

S&P said it revised its outlook for Service Properties Trust (SVC) to stable from negative and finalized the BB issue and 1 recovery ratings to its new senior secured notes. The agency assigned preliminary ratings on Nov. 8.

Concurrently S&P affirmed SVC’s B+ issuer and nonguaranteed senior unsecured notes ratings and the BB level rating on its guaranteed notes.

SVC will use the proceeds to redeem two series of notes due 2024 alleviating near-term refinancing issues.

“The stable outlook reflects our expectation for steady operating performance within SVC's hotel and net lease portfolios. Furthermore, we expect S&P Global Ratings-adjusted debt to EBITDA to improve modestly over the near term while adjusted fixed charge coverage (FCC) remains relatively stable, with EBITDA growth offset by higher interest expense,” S&P said in a press release.

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