Moody’s lifts Kite Realty

Moody's Investors Service said it upgraded Kite Realty Group, LP's senior unsecured debt rating to Baa2 from Baa3, its senior unsecured debt shelf rating to (P)Baa2 from (P)Baa3 and the issuer rating of its parent Kite Realty Group Trust to Baa2 from Baa3.

“The upgrade reflects the improvement in the REIT's operating and financial metrics over the past few years, such as releasing spreads and rent per square foot and its net debt to EBITDA ratio,” the agency said in a press release.

Moody’s noted Kite’s portfolio lease rate was 93.9% at the end of 2023 relative to 93.4% at year-end 2021 and average cash re-leasing spreads were 13.5% in 2022 and 2023.

“Moody's expects Kite Realty's portfolio lease rate and average rent to improve over the next two years as the REIT re-leases the space made available from the Bed Bath and Beyond store closings at higher rents. However, the slowing macroeconomic environment and potentially weaker business conditions for retailers will limit the extent of this improvement,” the agency added.

The outlooks are stable.

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