'The interest rate environment will be challenging and rating actions could be predicated on a REIT's ability to address an increase in interest rates,' said Managing Director and U.S. REITs group head
This comes as equity REITs take increasing advantage of continued favorable bank lending trends. REITs have boosted unsecured lines of credit by approximately 49% compared to
'REITs trying to become unsecured bond issuers are using both unsecured revolving lines of credit and unsecured term loans to unencumber the portfolio,' said Marks.
An encouraging sign is that REITs are continuing to unencumber their portfolios and remove secured debt from their capital structures. Draws on unsecured revolvers and unsecured term loans across issuers accounted for 10% of total debt outstanding as of
Fitch's 'Trends in U.S. Equity REITs Unsecured Lines of Credit' report is available at 'www.fitchratings.com' or by clicking on the below link.
Additional information is available at 'www.fitchratings.com'
Source: Fitch Ratings
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