Moody’s: Washington view negative

Moody's Investors Service said it affirmed all of Washington Prime Group Inc.'s ratings, including the Baa3 senior debt rating of operating subsidiary Washington Prime Group, LP, and revised the outlook to negative from stable.

The agency said the negative outlook reflects the potential cash flow risk associated with the REIT's mall portfolio due to an increasingly challenging retail environment, especially for mall owners such as Washington Prime that own portfolios with relatively low sales per square foot (below $400). Moreover, the REIT has significant upcoming debt maturities as $938 million comes due in 2019 and an additional $947 million in 2020 (including extension options).

The affirmation of Washington Prime's rating reflects its strong fixed charge coverage, growing unencumbered assets, national platform and diversification across two complementary asset categories that enhances its leasing strategy, Moody’s said.

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