Fitch Ratings affirmed its long-term issuer default rating on Unibail-Rodamco-Westfield at A- and its senior unsecured rating at A, and revised the ratings outlook to negative from stable.
The affirmation is based on the French diversified real estate investment trust's strong business profile anchored by its shopping centers in the EU, the U.K. and the U.S., and its large development program amid the weakening retail sector in the U.S. and U.K. due to e-commerce pressure and shifts in consumer spending.
The negative outlook reflects Unibail's high cash-flow leverage, which could take a longer time to deleverage than previously predicted by the rating agency.
Fitch said it expects the deleveraging from disposals to be balanced by the REIT's development capital expenditure and net debt-to-EBITDA to surpass 10x until at least 2021-end.
