Moody's changes view on Wharf Real Estate to stable

Moody's Investors Service said it changed to stable from negative the outlook on Wharf Real Estate Investment Co. Ltd. (WREIC) and Wharf REIC Finance (BVI) Ltd.

At the same time, Moody's affirmed WREIC's A2 issuer rating, as well as the (P)A2 senior unsecured ratings on the medium-term note program of Wharf REIC Finance and on the A2 senior unsecured notes issued under the MTN program, which are unconditionally and irrevocably guaranteed by WREIC.

“The change in outlook to stable reflects WREIC's demonstrated ability to arrest a further decline in occupancy rates for its retail malls and reduce debt, despite the persistently sluggish retail environment in Hong Kong SAR, China (Aa3 stable),” said Stephanie Lau, a Moody's vice president and senior credit officer, in a news release.

“This factor and an expected gradual recovery in retail consumption suggests that WREIC's operating performance and financial leverage will slowly improve over the next 12-18 months.”

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