SoFi CEO enters prepaid forward contract on 1.5 million shares
Investing.com -- Peach Property Group AG received an affirmation of its Long-Term Issuer Default Rating (IDR) at ’CCC+’ from Fitch Ratings on Wednesday, while its senior unsecured debt rating was upgraded to ’B’ from ’B-’.
The rating action reflects reduced uncertainty around the company’s EUR173 million unsecured bond maturing in November 2025. Peach Property announced a new EUR120 million secured financing on June 16, with EUR90 million providing new liquidity to partially repay the unsecured bond.
The residential property company has demonstrated its ability to address debt repayment challenges. By the end of the first quarter, Peach had used some of its EUR218 million cash reserves to repay promissory notes that matured in March 2025 and EUR125 million of November 2025 bonds through a tender offer.
For the remaining EUR83 million outstanding, the company is pursuing several options, including the recently secured financing, potential fresh equity issuance approved at the May 2025 shareholders’ meeting, and additional secured debt using residual value from existing low loan-to-value mortgage lending.
Peach Property’s EUR1.9 billion residential-for-rent portfolio was geographically refocused following a block disposal at the end of 2024. Currently, 84% of assets are located in Germany’s North Rhine-Westphalia area, which should improve cash flows and operational efficiency.
The company plans to allocate approximately EUR40 million annually for capital expenditure from 2025, primarily targeting strategic portfolio assets to reduce vacancy rates and achieve rental growth. The vacancy rate stood at 5.2% in strategic assets and 10.6% in non-strategic properties at the end of 2024.
Fitch expects Peach Property’s net debt/EBITDA leverage to improve to below 18x and interest coverage to rise above 1.5x by 2026 following the refinancing. The company’s loan-to-value ratio was 54% at the end of 2024, down from 60% a year earlier.
The rating agency noted that Peach Property’s portfolio quality is lower than larger peers, with an average in-place rent of EUR6.4 per square meter per month and a higher vacancy rate of 7.4% at the end of 2024.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.