JR Global REITs Obtains Credit Rating 'A-'... Corporate Bond Issuance in Second Half

JR Global REIT announced on the 16th that it had received a credit rating of A- (Stable) from Korea Ratings on the 2nd.

Finance Tower located in Brussels, Belgium / Photo by JR Global REITs

JR Global REIT owns two Class A office buildings as underlying assets: the Finance Tower located in Brussels, Belgium, and the building at 498-7 Manhattan, New York, USA.

Currently, the Finance Tower is 100% leased to the Belgian Building Agency under the Belgian federal government. The Manhattan building had a vacancy rate of 8.5% at the time of acquisition, but due to steady inflow of new tenants, it has now decreased to the 4% range.

The quality of the asset portfolio is also reported to be excellent. The appraised value of the Finance Tower was 1.44 billion euros as of last month, higher than the purchase price of 1.2 billion euros. The loan-to-value ratio (LTV) based on the appraised value is in the 50% range, leaving a margin of more than 15 percentage points before reaching the cash trap condition (70%).

The appraised value of the Manhattan building was 670 million dollars as of May, lower than the purchase price of 680 million dollars. However, JR Global REIT explained that the risk is minimal.

Meanwhile, JR Global REIT plans to enter the public corporate bond market in the second half of this year ahead of the maturity of 70 billion won in corporate bonds issued in 2021.

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