The criteria includes a summary of how it fits into the overarching GCR Ratings Framework, details of which available in the Criteria for the GCR Ratings Framework (please click here for further details). The criteria includes a scope and summary of key changes, together with a breakdown of how each of the components is to be assessed and scored.
The new criteria has retained much of the fundamentals utilised in the previous GCR methodology (namely, Global Credit Rating Co. – Global Master Criteria for Rating Real Estate Investment Trusts and Other Commercial Property Companies, last updated in February 2018). Of significance is the criteria’s alignment to the broader GCR Ratings Framework. Some of the specific changes introduced include a much greater emphasis on liquidity and covenant analysis.
GCR previously invited comment on the criteria from market participants. There have been no significant amendments to the criteria based on feedback. Smaller changes to the criteria include increased explanation regarding how the criteria/ framework is utilised, as well as various editing changes.
GCR anticipates a modest impact on the ratings of rated Real Estate Investment Trusts and Other Commercial Property Companies.
All Real Estate Investment Trusts and Other Commercial Property Companies rated by GCR have been placed “Under Criteria Observation”. The ratings of all affected entities will be reviewed using the new criteria over the next six months (between May 23 2019 and November 22 2019), which results in previously applicable review dates for these entities being potentially extended or brought forward.
Sector Head: Corporate and Local Authority Ratings
CREDIT RATINGS ISSUED AND RESEARCH PUBLICATIONS PUBLISHED BY GCR, ARE GCR’S OPINIONS, AS AT THE DATE OF ISSUE OR PUBLICATION THEREOF, OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. GCR DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL AND/OR FINANCIAL OBLIGATIONS AS THEY BECOME DUE. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: FRAUD, MARKET LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND GCR’S OPINIONS INCLUDED IN GCR’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. CREDIT RATINGS AND GCR’S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND GCR’S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL OR HOLD PARTICULAR SECURITIES. NEITHER GCR’S CREDIT RATINGS, NOR ITS PUBLICATIONS, COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. GCR ISSUES ITS CREDIT RATINGS AND PUBLISHES GCR’S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING OR SALE.