The latest information on the rating, including rating reports and related methodologies, is available on this LINK.

Rating action

Scope Ratings GmbH (Scope) has assigned a new rating of BBB to Norwegian Property ASA’s (NPRO) senior secured bonds with ISIN NO0013251801 and NO0013251827. Further Scope has assigned a new BBB rating to NPRO’s senior secured bond with ISIN NO0013270348. Scope has taken no action on NPRO’s BBB-/Negative issuer rating.

The full list of rating actions and rated entities is at the end of this rating action release.

Debt ratings

On 29 May 2024 (settlement date 12 June 2024) Norwegian Property has issued two five-year senior secured bonds over NOK 635m 2024/2029 (NO0013251801) and NOK 340m 2024/2029 (NO0013251827) to refinance the NOK 500m 2017/2024 NPRO 07 bond (ISIN NO0010794241) and the NOK 450m 2017/2024 NPRO 08 bond (ISIN NO0010794258). The NOK 635m bond carries a floating rate coupon of 3 months Nibor +1.5%, payable quarterly in arrears, starting on 5 July 2024. The NOK 340m bond carries an annual fixed coupon of 5.5%, payable in arrears. Both bonds and bondholders rank pari passu, Norwegian Property's standard intercreditor agreement governs the treatment of creditors. Nordic Trustee has been appointed as trustee. A change of control put option has been built into the documentation as well as a maximum loan/value of 65% (incurrence) on the collateral Fondbygget which was valued by Cushman & Wakefield at NOK 1,523m as of Q1 2024. The bonds will be listed on the Oslo Stock Exchange.

On 24 June 2024 (settlement date 8 July 2024) Norwegian Property has issued a three-year senior secured bond over NOK 420m 2024/2027 (NO0013270348) to refinance the NOK 400m 2017/2024 NPRO 09 bond (ISIN NO0010799547). The NOK 420m bond carries a floating rate coupon of 3 months Nibor +1.28%, payable quarterly in arrears, starting on 5 October 2024. Nordic Trustee has been appointed as trustee. A change of control put option has been built into the documentation as well as a maximum loan/value of 65% (incurrence) on the collateral Drammensveien 60 which was valued by Cushman & Wakefield at NOK 652m as of Q1 2024. The bonds will be listed on the Oslo Stock Exchange.

The senior secured bonds NO0013251801 and NO0013251827 are assigned a new BBB rating, based on the underlying issuer rating of BBB-/Negative. These Senior Secured Notes benefit from a first-ranking pledge on the property Fondbygget in the central business district Aker Brygge in Oslo. The senior secured bond NO0013270348 is assigned a BBB rating, also based on the underlying issuer rating of BBB-/Negative. This Senior Secured Note benefits from a first-ranking pledge on the property Drammensveien 60 in Oslo. In the event of a hypothetical default, additional pro rata proceeds from any liquidation proceeds would be distributed pari passu among all holders of senior secured debt. 

Environmental, social and governance (ESG) factors

Overall, ESG factors have no impact on this credit rating action.

All rating actions and rated entities

Norwegian Property ASA

Issuer rating: BBB-/Negative, no action

Senior secured bond (ISIN NO0013251801) rating: BBB, new

Senior secured bond (ISIN NO0013251827) rating: BBB, new

Senior secured bond (ISIN NO0013270348) rating: BBB, new

*All credit metrics refer to Scope-adjusted figures.

Stress testing & cash flow analysis
No stress testing was performed. Scope Ratings performed its standard cash flow forecasting for the company.

Methodology
The methodologies used for these Credit Ratings, (European Real Estate Rating Methodology, 28 March 2024; General Corporate Rating Methodology, 16 October 2023), are available on https://scoperatings.com/governance-and-policies/rating-governance/methodologies.
Information on the meaning of each Credit Rating category, including definitions of default, recoveries, Outlooks and Under Review, can be viewed in ‘Rating Definitions – Credit Ratings, Ancillary and Other Services’, published on https://www.scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Historical default rates of the entities rated by Scope Ratings can be viewed in the Credit Rating performance report at https://scoperatings.com/governance-and-policies/regulatory/eu-regulation. Also refer to the central platform (CEREP) of the European Securities and Markets Authority (ESMA): http://cerep.esma.europa.eu/cerep-web/statistics/defaults.xhtml. A comprehensive clarification of Scope Ratings’ definitions of default and Credit Rating notations can be found at https://www.scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Guidance and information on how environmental, social or governance factors (ESG factors) are incorporated into the Credit Rating can be found in the respective sections of the methodologies or guidance documents provided on https://scoperatings.com/governance-and-policies/rating-governance/methodologies.

Solicitation, key sources and quality of information
The Rated Entity and/or its Related Third Parties participated in the Credit Rating process.
The following substantially material sources of information were used to prepare the Credit Ratings: public domain, the Rated Entity, third parties and Scope Ratings' internal sources.
Scope Ratings considers the quality of information available to Scope Ratings on the Rated Entity or instrument to be satisfactory. The information and data supporting these Credit Ratings originate from sources Scope Ratings considers to be reliable and accurate. Scope Ratings does not, however, independently verify the reliability and accuracy of the information and data.
Prior to the issuance of the Credit Rating action, the Rated Entity was given the opportunity to review the Credit Ratings and the principal grounds on which the Credit Ratings are based. Following that review, the Credit Ratings were not amended before being issued.

Regulatory disclosures
These Credit Ratings are issued by Scope Ratings GmbH, Lennéstraße 5, D-10785 Berlin, Tel +49 30 27891-0. The Credit Ratings are UK-endorsed.
Lead analyst: Thomas Faeh, Executive Director
Person responsible for approval of the Credit Ratings: Philipp Wass, Managing Director
The Issuer Credit Rating/Outlook was first released by Scope Ratings on 28 April 2022. The Credit Rating/Outlook was last updated on 3 May 2024.
The Credit Ratings assigned to three bonds were first released by Scope Ratings on 3 July 2024.

Potential conflicts
See www.scoperatings.com under Governance & Policies/Regulatory for a list of potential conflicts of interest disclosures related to the issuance of Credit Ratings, as well as a list of Ancillary Services and certain non-Credit Rating Agency services provided to Rated Entities and/or Related Third Parties.

Conditions of use/exclusion of liability
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