Fitch Affirms & Removes iStar from Rating Watch Negative.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. has affirmed and removed from Rating Watch Negative the Issuer Default Rating (IDR IDR In currencies, this is the abbreviation for the Indonesian Rupiah. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. ) and outstanding debt ratings of iStar Financial Inc. (iStar) as follows: --IDR at 'B-'; --Unsecured revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. facilities at 'B-/RR4'; --Senior unsecured notes at 'B-/RR4'; --Convertible senior floating-rate notes at 'B-/RR4'; --Preferred stock at 'CC/RR6'. The Rating Outlook is Negative. The rating action affects approximately $8.3 billion of obligations. The removal of iStar's ratings from Rating Watch Negative is based on iStar's entry on March 16, 2009 into a $1 billion delayed draw secured credit agreement with participating members of its existing bank lending group. This new financing provides iStar with additional capital to improve the company's liquidity in addressing near-term debt maturities and funding obligations to iStar's existing borrowers, which Fitch noted as concerns in placing iStar's ratings on Rating Watch Negative on March 3, 2009. Offsetting the liquidity improvement is the subordination to which iStar's unsecured creditors are now subject. In addition to the company entering into the $1 billion delayed draw secured credit agreement, iStar entered into secured debt agreements with its existing lenders totaling $2.65 billion, which, taken together, encumber To burden property by way of a charge that must be removed before ownership is free and clear. Property subject to an encumbrance may have a lien or mortgage imposed upon it. approximately $4.4 billion of iStar's assets. These new secured financings result in a smaller and lower-quality unencumbered asset pool supporting unsecured creditors. The assignment of a Negative Outlook reflects Fitch's concern that challenging conditions in the commercial real estate debt capital markets will continue to make it difficult for iStar's borrowers to repay their loans on a timely basis, thus weakening iStar's liquidity position. While iStar's entry into the new $1 billion secured credit agreement will provide the company with capital to address a portion of capital uses during 2009, iStar may need to rely on the resolution of non-performing loans and asset sales to address 2009 debt maturities and funding obligations. A revision of the Negative Outlook to Stable would be driven by: --The reduction in the level of non-accrual and watch list loans to less than 25% of the gross loan portfolio (currently 37%); --iStar meeting future funding obligations and 2009-2010 unsecured debt Unsecured debt Debt that does not identify specific assets that the debtholder is entitled to in case of default. maturities via borrower loan repayments, resolution of non-performing loans and asset sales, as opposed to incurring additional debt. Headquartered in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , iStar provides structured financing and corporate leasing of commercial real estate nationwide. iStar leverages its expertise in real estate, capital markets, and corporate finance to serve real estate investors A real estate investor is someone who actively or passively invests in real estate. An active investor may buy a property, make repairs and/or improvements to the property, and sell it later for a profit. and corporations with sophisticated financing requirements. As of Dec. 31, 2008, iStar had $15.8 billion of undepreciated assets and $2.9 billion of undepreciated book equity. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental are also available from the 'Code of Conduct' section of this site. |
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