S&P upgrades Grand City

S&P said it raised the long-term corporate credit rating on Grand City Properties SA to BBB+ from BBB.

The outlook is stable.

The agency also said it raised the issue ratings on Grand City's senior unsecured debt to BBB+ from BBB and on its subordinated hybrid debt BBB- from BB+.

The upgrades reflect the company’s increased proportion of income-producing properties, reflecting a reduction of vacancy rates to less than 10%, which supports a more stable and higher recurring cash flow base, S&P said.

The company benefits from a broad geographic spread across densely populated regions with good growth prospects in Germany, the agency said.

Its focus on mainly metropolitan areas with favorable macroeconomic fundamentals enabled the company to markedly reduce vacancy to 8.1% in October 2016 from 12.5% at the same time a year earlier, S&P explained.

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