Fitch assigns BBB to Kite Realty

Fitch Ratings said it assigned a first-time long-term issuer default rating of BBB to Kite Realty Group Trust and Kite Realty Group, LP. The agency also gave a BBB rating to Kite Realty Group's senior unsecured revolver, term loans and notes. The outlook is stable

“The ratings and outlook reflect the improved size and scale of the combined portfolio following the merger with Retail Properties of America, Inc. (RPAI), stable operating cash flows from a substantially grocery-anchored portfolio, and investment grade credit metrics, partly tempered by modest execution risk. Fitch expects the company's leverage will trend to the mid-to-high 5x range through the forecast period, a level that would be consistent with the BBB rating,” the agency said in a press release.

Fitch said it forecasts KRG to refinance maturing secured debt with unsecured borrowing, expanding its unencumbered asset pool and sees $27 million-$29 million of synergies from the merger, which the company expects to fully realize over the next 12-18 months.

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