S&P Global Ratings placed the ratings of Quality Care Properties Inc. on CreditWatch with negative implications, including its B+ corporate credit rating, BB issue-level rating on the first-lien term loan and BB- issue-level rating on the second-lien notes.
The rating agency also placed the ratings of the company's wholly owned subsidiaries SNF West Sub-REIT, SNF Central Sub-REIT, SNF East Sub-REIT, and AL Sub-REIT, on CreditWatch negative.
The rating agency's actions reflect the default of HCR III Healthcare LLC, the company's largest tenant, on its lease agreement and violation of its rent forbearance agreement with QCP.
S&P said in a note that it plans to resolve the CreditWatch placement after gaining a better understanding of the company's strategic options, including the possibility of taking over operating assets from HCR and assuming an owner-operator role.
S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.