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Moody's cuts Peach Property
Moody's Investors Service said it downgraded to Ba3 from Ba2 the corporate family rating of Peach Property Group AG.
At the same time, Moody's downgraded to B1 from Ba3 the backed senior unsecured instrument rating of Peach Property Finance GmbH, a wholly owned subsidiary of PPG.
The outlook remains negative.
Moody's downgrade reflects (1) a weak Moody's adjusted fixed charge coverage that stood at 1.5x as of Dec. 31 and is not expected to materially improve in the next 18 months driven by high refinancing costs, and (2) elevated execution risk from a strategy that is likely to rely on a combination of asset disposals in still challenging investment markets and potentially fresh equity to delever and begin to address the €300 million backed senior unsecured bond maturing in November 2025.
More positively, Moody's said it expects the company to continue its track record of strong operating performance with good rental growth and lower vacancy supported by the regulated German rental sector's favorable fundamentals.
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