The downgrade is based on increased reliance of its parent (GOPD Nyrt.) on dividends from SunDell, which are needed to service debt at the holding level.

Pre-sales providing a backlog of above one year and the fixed-rate debt in place amid rising interest rates support the rating affirmation.

Strong sales in the first half of 2022, thanks to the retail green housing programme at low retail mortgage rates provide backlog until 2023, and the exclusively fixed-rate debt support the rating affirmation.

Strong performance in 2021, a significantly increased project pipeline supported by recent equity issuance in 2022 of HUF 9bn and a HUF 5.5bn green bond issued in 2021 support the affirmation in a challenging environment.

Scope Ratings affirms the B/Stable issuer rating as well as the senior unsecured debt rating for SunDell Estate Nyrt. after receiving updated company planning that includes a contemplated placement of a HUF 5bn senior unsecured green bond.

Following a monitoring review of Hungarian real estate developer SunDell Estate Nyrt., Scope takes no action regarding the issuer rating of B/Stable. The instrument rating of B+ for senior unsecured debt also remains unchanged.

The ratings are primarily driven by the company's moderate leverage but constrained by a lack of recurring revenues and a concentrated project pipeline.