This article is from the Australian Property Journal archive
CREDIT rating agency Standard & Poor’s has revised Mirvac’s outlook from stable to positive, citing continued growth of its investment portfolio whilst at the same time, divesting noncore assets.
S&P has also reaffirmed Mirvac’s BBB+ and ‘A-2’ short-term corporate credit ratings.
“We revised the outlook to positive because continued improvement in Mirvac’s office, retail, and industrial investment portfolio could materially boost its investment earnings. This potential uplift could raise the rating to ‘A-‘ over the next two years,” S&P analyst Craig Parker said.
“We consider Mirvac’s successful execution of its A$2.4 billion development program could materially lift the quality and magnitude of its investment earnings over the next three to four years. Such higher earnings could strengthen the group’s business risk profile.
“Mirvac’s development program, which is focused on its office and industrial assets, could add about A$90 million per annum of investment earnings from its office and industrial portfolio by 2021. If successfully completed, it would support overall growth in investment earnings by over 20% from current 2017 levels,” he added.
Mirvac’s CFO Shane Gannon said the revised outlook underscored the strength of the group’s capital position and reinforced its capital management strategy.
“We have a disciplined and conservative approach to managing our capital, and have undertaken a number of key initiatives over the past 12 months that ensures we are well-placed for the future.
“The revised outlook is also a testament to the quality of our investment portfolio and our significant development pipeline,” he said.
The revised outlook follows Mirvac’s recent credit rating upgrade from Moody’s Investor Services from Baa1 to A3.
Australian Property Journal
