An economic shock is unlikely to shake Asia-Pacific REITs’ credit foundations, says Standard & Poor (S&P) in its sector review dated Monday.
In the event of a downturn, the rating agency believes that a large number of rated REITs will still be able to debt fund growth opportunities and weather another downturn akin to the global financial crisis of 2008-2009 as they have already incorporated rating buffers into their financial profiles.
In the near term, S&P forecasts that rated REITs will continue maintain moderately conservative financial risk metrics that provide a large rating buffer to withstand debt-funded growth and economic shocks.
The REITs are also well positioned to take advantage of opportunities that may arise in their local real estate markets due to potential dislocations.
Rated REITs possess "strong asset quality, solid market positions and sound operating strategies;” the report added.
Despite the glowing appraisal, the rating agency also warned that subdued rental growth across major real-estate commercial markets such as Australia, Hong Kong and Singapore may dampen income.
Japan REITs, however, will continue to expand moderately due to equity financing and BOJ’s continued negative interest rate policy.
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In the event of a downturn, the rating agency believes that a large number of rated REITs will still be able to debt fund growth opportunities and weather another downturn akin to the global financial crisis of 2008-2009 as they have already incorporated rating buffers into their financial profiles.
In the near term, S&P forecasts that rated REITs will continue maintain moderately conservative financial risk metrics that provide a large rating buffer to withstand debt-funded growth and economic shocks.
The REITs are also well positioned to take advantage of opportunities that may arise in their local real estate markets due to potential dislocations.
Rated REITs possess "strong asset quality, solid market positions and sound operating strategies;” the report added.
Despite the glowing appraisal, the rating agency also warned that subdued rental growth across major real-estate commercial markets such as Australia, Hong Kong and Singapore may dampen income.
Japan REITs, however, will continue to expand moderately due to equity financing and BOJ’s continued negative interest rate policy.
Click Here To Register For Free Trial Services OR Give A Missed Call : +6531581402 Follow Us On Twitter : www.twitter.com/epicresearchsg Like Us On Facebook : www.facebook.com/EpicResearchSingapore Need Any Assistance Feel Free To Mail Us at : info@epicresearch.sg
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