Fitch rates Associated Estates notes BBB-

Fitch Ratings said it assigned a BBB- rating to the $150 million issuance of senior unsecured notes by Associated Estates Realty Corp.

The notes were offered in a private placement and consisted of $63 million eight-year notes with a yield of 4.02% and $87 million 10-year notes with a yield of 4.45%.

The proceeds were used to repay borrowings under the company's unsecured credit facility, including amounts borrowed in December to repay two mortgages totaling about $33.6 million.

The company has an issuer default rating of BBB- and BBB- ratings on its $350 million senior unsecured revolving credit facility, $150 million senior unsecured term loan and $150 million senior unsecured notes.

The outlook is stable.

The ratings reflect favorable multifamily fundamentals resulting in sustained fixed-charge coverage and the company's acquisition-driven increase in size that lessens asset concentration, Fitch said.

The ratings also consider credit concerns including an increased development pipeline that hampers liquidity, as well as heavy 2013 debt maturities, the agency said.

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