Moody's views Office Properties negatively

Moody's Investors Service said it changed its outlook for Office Properties Income Trust (OPI) and Select Income REIT to negative from stable.

“The negative outlook reflects the office REIT's increased leverage following debt-financed acquisitions executed in mid-2021 and risks that its liquidity profile will deteriorate as it seeks to sell assets and address funding needs (including debt maturities and development spending) amidst a challenging transaction environment. Aside from financial policy, the outlook also considers operating risks as OPI faces a large amount of lease expirations in 2023 and 2024 which could pressure occupancy and cash flows,” Moody’s said in a press release.

Concurrently, the agency affirmed OPI’s and Select Income’s Baa3 ratings.

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