Moody's lifts Senior Housing view to positive

Moody's Investors Service said it affirmed Senior Housing Properties Trust's senior debt rating at Ba2 and raised the rating outlook to positive from stable to reflect the improving credit profile of Five Star Quality Care, Inc. - Senior Housing Properties' largest tenant - and the REIT's execution of a disciplined growth strategy.

The agency said Five Star has grown to be the fourth-largest public operator of senior living facilities in the USA and has repeatedly demonstrated its ability to access the capital markets. In addition, Senior Housing Properties has demonstrated modest, consistent growth - increasing its presence in the private pay segments of the health care real estate markets and reducing its exposure to government reimbursement and the associated earnings volatility - and its conservative financial profile, earmarked by low leverage, minimal usage of secured debt and high fixed charge coverage, continues to be a key credit strength.

Senior Housing's large tenant concentration and external management structure are important credit challenges, Moody's said.

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