S&P Global Ratings upgraded VICI Properties Inc.'s corporate credit rating to BB from BB-, with a stable outlook.
The rating agency also raised its issue-level ratings on the experiential-asset real estate investment trust's secured debt to BBB- from BB+.
The upgrade takes into account S&P's view that VICI's recent IPO has decreased financial risk as the company used part of the offering proceeds to settle roughly $700 million in debt. The rating agency now projects leverage to be more than 1x better compared to its previous forecast.
The stable outlook mirrors S&P's expectation for minimal cash flow volatility given the triple-net lease structure under which almost all of the company's cash flows are fixed.
S&P believes VICI will be able to sustain leverage under 6x through 2019, minus acquisitions. However, the rating agency said the company could increase leverage from current levels for future acquisitions.
This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings, a separately managed division of S&P Global. Descriptions in this news article were not prepared by S&P Global Ratings. The original S&P Global Ratings documents referred to in this news brief can be found here.
