RATINGS agency Standard & Poor’s has given New Zealand REIT Goodman Property Trust a BBB long-term corporate credit rating as well as a stable outlook.
At the same time, S&P has assigned a BBB+ long-term credit rating to the senior secured bonds of GMT, which is 17% owned by Goodman Group – listed on the ASX.
Standard & Poor’s credit analyst Craig Parker said the rating on GMT reflects the trust’s strong market position in the NZ industrial and office sectors, manageable lease-rollover schedule and good tenant retention, and sound co-investment strategy.
In addition, GMT’s gearing is at the lower end of the target range, providing some latitude to withstand further asset devaluations or increased vacancy at the trust’s properties.
“In our opinion, GMT is well-placed to withstand the current volatile property market environment given its strong liquidity, high occupancy rates, and manageable development exposure.
“Downward movement to the credit rating could occur if GMT moved toward the outer limits of its development and gearing targets, or there were a material deterioration in the trust’s credit metrics, or covenant headroom diminishes,” he added.
Meanwhile Parker said the trust’s rating is unlikely to be upgraded in the current environment.
He added that S&P would reconsider the move if GMT adopted more conservative financial policies while further expanding its asset base in high-quality properties.
Australian Property Journal
