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Fitch assigns BBB+ to Vonovia
Fitch Ratings said it assigned Vonovia SE a first-time long-term issue default rating of BBB+ and a BBB+ senior unsecured rating. The outlook is stable.
“Vonovia's annualized like-for-like (lfl) rent increased by 3.8% yoy in 2023 (2022: 3.3%). Within this, organic rent growth increased by 2.3% yoy in 2023 (2022: 1.0%) as multiple regional Mietspiegel indices allowed phased rent increases (including some of 2023's CPI inflation, and operational and construction cost increases, including the cost of capital). This marked yoy increase compares with 2023's 1% rental growth from re-lets and modernized apartments (some with minimal capex yielding 10% rent growth, or capex yielding 30% growth), and 2023's subdued 0.5% increase in rent from new-builds,” the agency said in a press release.
Fitch said it forecasts Vonovia's net debt/rental-derived EBITDA to moderate to 17x during FY24-FY26 (financial years ending December 2024-2026) from 18x (YE23: 18.8x), buoyed by gradual increases in rental income and further asset disposals.
The agency said it expects Vonovia’s rental income to rise in the future.
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