S&P Global Ratings affirmed its BB long-term corporate credit rating on Adler Real Estate AG and revised its outlook to positive from stable.
The rating agency also affirmed its BB+ long-term issue rating on the company's senior unsecured debt.
The positive outlook was attributed to the possibility of "stronger-than-expected" credit metrics arising from the company's efforts to improve its operating and financial performances.
The agency also noted Adler's improved cost of funding following its placement of an €800.0 million bond. S&P understands that the company is using the proceeds to buy back €676 million of its Schuldschein loans, which it said will improve its cost of debt to 2.7% in 2018 from 3.5%.
S&P estimates Adler's adjusted EBITDA-to-interest ratio will rise to 1.7x in 2018 and 1.8x in 2019, from 1.3x in 2017.
S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.
