Climbing Property Prices And Rising Debt Could Heighten Risk For European Commercial Real Estate Companies Nov 05
- ID: 1793576
- November 2005
- Region: Europe
- Standard & Poors
European property values are at cyclical highs, boosted by low interest rates and booming investor demand for real estate. The current value cycle is unusual, however, in that rental markets remain relatively weak. Prospects for most European commercial real estate companies rated by Standard & Poor's Ratings Services are stable in the near term, while the medium-term outlook is more clouded. As companies benefit from inflated asset values, many are using the headroom on their balance sheets to increase debt to expand their assets or to reward shareholders over and above what current rental market conditions might warrant. Our credit ratings on European real estate companies are expected to withstand a drop in asset values or a rise in interest...
Companies mentioned in this report are:
- MEPC Ltd.
- Societe Fonciere Lyonnaise S.A.
- Jones Lang LaSalle Inc.
- Klepierre S.A.
- Derwent London PLC
- Cofinimmo S.A./N.V.
- Befimmo S.A.
- Regus Group PLC
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Research Type: Commentary
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