Fitch rates Balkans Real Estate, bond BB

Fitch Ratings said it assigned Balkans Real Estate BV (BRE) and its planned senior unsecured bond BB ratings. The recovery rating on the bond is RR4.

The issuer’s ratings are constrained by its assets being concentrated in Belgrade, Serbia, Fitch said.

“The portfolio was valued at €0.7 billion at end-2021. The ratings also reflect the portfolio's quality and its strong position in the nascent Belgrade property market, as well as diversification across the retail and office segments. The portfolio, rented mainly to multinational tenants, currently uses secured debt, while the planned unsecured bond is part of BRE's strategy to access unsecured funding,” the agency said in a statement.

Fitch noted it forecasts BRE’s net debt/EBITDA to decline to 6.3x in 2025 from an estimated 6.8x in 2022.

The outlook is stable.

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