Globe Trade Center announced that it has been assigned an investment grade rating of BBB- with a Stable Outlook by Fitch Ratings and Ba1 with Positive Outlook rating by Moody’s Investors Service.

Following the streak of successful landmark transactions and its first-ever publication of an ESG report, GTC continues to strengthen its position in CEE by obtaining credit ratings from Fitch Ratings (“Fitch) and Moody’s Investors Service (“Moody’s). GTC has been rated by Fitch at an investment grade rating of BBB- (Stable) and Ba1 (Positive) by Moody’s, confirming the Group’s solid performance. GTC obtained credit ratings in anticipation of its planned green Eurobonds issue of EUR 500 million, as part of its move from secured to predominantly unsecured Eurobond financing.

 “We are delighted to obtain ratings from Fitch and Moody’s which recognize GTC’s strong business profile and provides the Group with more flexibility to cement our foothold in the CEE Real Estate market. We believe the investment grade rating from Fitch validates our record of delivering strong operational results and the quality of our long-term cash flows, as well as, demonstrating our commitment to a best-in-class balance sheet. By remaining active on the capital markets in 2020, we managed to raise approximately EUR 110 million of senior unsecured bonds, providing additional flexibility for debt repayment and undertaking new developments and acquisitions. This first issue of HUF-denominated green bonds within our “Green Bond Framework” in December 2020 further demonstrated GTC’s commitment to sustainability and financial innovation, which was recognized with a BBB- investment grade rating by the Scope Rating Agency” – commented Ariel Ferstman, GTC’s CFO and Member of the Management Board.

GTC holds a 2.1-billion-euro portfolio, including modern office and retail income generating properties, based in Poland and capital cities of five CEE countries. The office and retail portfolio, leased to multinational and local blue-chip tenants, is currently predominantly financed by secured debt, whereas the planned bond issue of EUR 500 million follows GTC’s strategy to transition to a predominantly unsecured debt funding model. Recently the Company has announced the sale of its Belgrade office portfolio at EUR 2 million above book value, releasing funds to be reinvested mainly in Polish and Hungarian projects. Alongside the 500-million-euro bond issue, this will strengthen the company’s position in the CEE real estate market.

“Proceeds from the planned 500-million-euro bond will mainly be used to prepay a multitude of secured loans, thereby increasing GTC’s financial flexibility and increasing our unencumbered ratio to close to 50%. This will improve GTC’s contingent liquidity and recovery prospects for unsecured creditors” – added Ariel Ferstman, GTC’s CFO and Member of the Management Board.

Moody’s and Fitch also highlighted the real estate company’s income generating portfolio with a high share of green certified assets at 84% and the Group’s further plans to achieve 100% eco-certification for all its properties in CEE. The ambition is already realized in Poland, where all GTC offices have environmental certificates and are powered by green energy. Nevertheless, the company continues to develop premium quality sustainable properties with tenant comfort and community wellbeing in mind. Two new office projects are currently under construction: Pillar, a 29,000 sq m A-class office building in Budapest 96% pre-leased to Exxon Mobil, and Sofia Tower 2, an 8,300 sq m add on to the existing mixed-use project in Sofia, Bulgaria. There are two further projects (52,300 sq m of office space in total) ready to be launched once pre-lets are procured.

Both Fitch and Moody’s assigned strong credit ratings based on the Group’s resilient operating environment supported by a robust economic backdrop across its main countries of operations. Strong medium-to-long-term fundamentals and good liquidity, further improving with the planned bond and equity issuance, will considerably expand GTC’s unencumbered asset base. The agencies also viewed positively GTC’s long-term oriented main shareholder Optima that holds a 66% stake, fully supporting management’s action plan.

This communication does not constitute or form part of any offer or solicitation to purchase or subscribe for securities in any jurisdiction. A securities rating does not constitute a recommendation to buy, sell or hold securities and is subject to change, suspension, or withdrawal at any time by the organisation assigning it. Similar ratings for different types of issuers and types of securities will not necessarily carry the same weight. The weighting of each rating should be analysed independently of the other ratings.

This announcement does not constitute or form part of any offer or solicitation to purchase or subscribe for securities in any jurisdiction.  A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or withdrawal at any time by the assigning rating organization. Similar ratings for different types of issuers and on different types of securities do not necessarily mean the same thing. The significance of each rating should be analyzed independently from any other rating.