S&P rates CCRE notes B+

S&P said it assigned a B+ long-term issue rating to a proposed issue of dollar-denominated senior unsecured notes by Central China Real Estate Ltd. (CCRE).

The agency also said it assigned a cnBB long-term Greater China regional scale rating to the notes.

The proceeds will be used to repay the Singapore-dollar denominated notes due May 2017 and refinance its existing debt, S&P said.

The company has demonstrated satisfactory sales performance so far this year, the agency said.

Central China Real Estate's debt leverage will stabilize with debt-to-EBITDA ratio of about 6x in 2016, S&P said.

The agency said it expects the ratio to gradually improve toward 5x in the next two years.

The ratings also reflect the company's geographic concentration in Henan, average profitability, high debt leverage and an operating scale similar to its peers, S&P said.

These weaknesses are offset by the company's established market position in Zhengzhou, long operating record in the industry and evenly distributed debt maturity profile, the agency said.

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