Fitch lowers American Assets view to negative

Fitch Ratings said it affirmed the ratings of American Assets Trust, Inc. and American Assets Trust, LP at BBB.

The outlook also was revised to negative from stable.

The negative outlook primarily reflects a concern that American Assets Trust's leverage has been above the negative leverage sensitivity of 6.5x for several quarters, Fitch said.

The recent rise in leverage is due to a large debt-funded acquisition in 2017, recent retail and office vacancies and significant outlays of capital related to redevelopment and releasing activities , Fitch said.

Additional concerns include the company's exposure to individual assets representing a significant proportion of American Assets Trust's overall annualized base rent, the agency said.

Credit strengths include the group's focus on high growth and high quality assets in the U.S. West Coast markets, which is expected to result in growing cash flow in excess of fixed charges, Fitch said.

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