Moody’s cuts Mapletree North Asia

Moody’s Investors Service said it downgraded Mapletree North Asia Commercial Trust to Baa2 from Baa1.

Moody’s also downgraded the backed senior unsecured rating on the notes drawn down under Mapletree North Asia Commercial Treasury Co. Ltd.’s euro medium-term note program to Baa2 from Baa1.

The notes of Mapletree North Asia Commercial Treasury Co. Ltd. and programs of Mapletree North Asia Commercial Trust Treasury Co. Pte. Ltd. and Mapletree North Asia Commercial Treasury Co. are guaranteed by DBS Trustee Ltd., in its capacity as the trustee of MNACT.

The downgrades to Baa2 reflect Moody’s estimate that MNACT’s credit metrics will weaken, following its proposed acquisitions of two office properties in greater Tokyo. MNACT plans to acquire the two office properties in Mapletree Investment Pte. Ltd., for a total S$482.5 million. For the transaction, 30% of the aggregate agreed property value, being about S$145.5 million, will be equity-funded by way of issuing transaction units to the sponsor. The balance of the total acquisition cost of S$337 million will be funded by a mix of secured and unsecured debt, and/or internal cash resources, Moody’s said.

“"The proposed acquisitions will reduce MNACT’s concentration risk to Festival Walk, but the risk remains elevated because Festival Walk will continue to account for more than 50% of the trust’s revenue and asset portfolio post transaction,” said Jacintha Poh, a Moody’s vice president and senior credit officer, in a press release.

The outlook is negative.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.