Fitch cuts, ups, pulls Emirates REIT

Fitch Ratings said it downgraded Emirates REIT's long-term issuer default rating to RD, or restricted default, from C, upgraded the rating to CCC+ and simultaneously withdrew the rating.

The rating actions follow the refinancing of ER's $400 million sukuk notes on Monday into $380 million of new two-year (plus one year) secured instruments, with new terms and conditions.

“The RD IDR reflects this distressed debt exchange (DDE; as per Fitch's DDE Criteria). ER's IDR had been C since May 2021, reflecting Fitch's expectations that a form of distressed debt exchange would take place.

“The post-DDE CCC+ IDR reflects the profile of the new debt, which will necessitate refinancing within 18-24 months, limited operational flexibility for ER owing to the terms and conditions, as well as tight liquidity. The company's operations continue to improve, benefiting from the operating environment and the resolution of several legacy issues,” the agency said in a press release.

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