OREANDA-NEWS. August 03, 2015. RusRating has assigned a credit rating to  Zemelniye Aktivy. The rating is "BB" on the international scale and "BBB" on the national scale, in both cases with a stable outlook.

The rating is based on the project’s high anticipated operating margin, a low debt burden if the project is carried through to completion, and financial backing from a large Russian bank.

Constraining factors include high risks associated with the early stages of a new development project and the Company’s short history.

About the Company

Zemelniye Aktivy [trs. Land Assets LLC] was set up in June 2014. Information on its ultimate beneficiary owner was provided to RusRating for rating purposes, but has not been publicly disclosed. The Company owns 204 000 m2 of land value at approx. R2bn and is developing the Skazka multi-storey residential complex in the town of Zarechye (Odintsovo district of Moscow region). The project includes multiple nine-storey residential structures, schools, kindergartens and a park/woods complex. Plans call for construction to take place in four stages, with the last scheduled for completion in 2022.

The Company’s principal assets are fixed assets (land), while most liabilities take the form of accounts payable to co-investors. Use of borrowed funds is negligible at this time but PromsvyazBank is expected to provide loan financing as the project progresses; initial borrowing will push up the debt burden, but thanks to a high internal rate of return this is expected to decline to moderate. Liquidity is sufficient. Risk sensitivity is moderate.