Accelerate Property Fund Limited

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Accelerate Property Fund Limited Rated (2021-09)
  • Accelerate Property Fund Limited
  • Year : Sep 2021
3 Tokens
USD 300.00
Summary

Accelerate is proceeding with its intention to sell its European assets, which is expected to provide support to the funding profile. Following the repayment of the related Euro debt, the REIT expects to receive around R600m in net proceeds. These will be used to repay domestic debt facilities, which should see the overall LTV fall to around 41% and the SPV LTV to 42%. There are also around R200m in asset sales that are expected to transfer before 1H FY22 with the proceeds to be used to redeem debt, whilst the REIT has a larger sales pipeline of R759m whose proceeds will be used to further reduce debt as required and to fund the future development of core investment properties.

Additional Information

The Rating Watch Negative reflects the potential for additional downgrades if the proposed assets sales and the refinancing activity are not timeously concluded, as this will greatly increase the likelihood of a covenant breach, and place the REIT under significant liquidity pressure. The rating outlook could return to stable if the REIT’s operating performance stabilises, with a rebound in rentals and performance metrics, alongside the conclusion of the asset sales and refinancing agreements, helping to strengthen credit protection metrics and lengthen the debt maturity profile.

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