Fitch Affirms American Tower Trust, Series 2013-1A and 2013-2A
--$500 million 2013-1A class at 'AAAsf', Outlook Stable;
--$1.3 billion 2013-2A class at 'AAAsf', Outlook Stable.
KEY RATING DRIVERS
The affirmations are due to the stable performance of the collateral since issuance. In addition to low leverage, Fitch's ratings of 'AAAsf' for this transaction are a result of exceptionally strong tenant, collateral, portfolio, sponsorship, and transaction attributes. Consistent with Fitch's published U.S. wireless criteria for 'AAAsf' ratings, the debt is expected to fully amortize over the first 15 years of the transaction.
As of the January 2016 distribution date, the aggregate principal balance of the notes remains unchanged from issuance at $1.8 billion. As part of its review, Fitch analyzed the financial and site information provided by the master servicer, Midland Loan Services. As of January 2016, aggregate annualized run rate net cash flow (NCF) increased 18.5% from issuance to $518.2 million with a Fitch stressed debt service coverage ratio (DSCR) increasing to 2.90x from 2.36x at issuance.
The tenant type concentration is stable. As of January 2016, total revenue contributed by telephony tenants was 95%. Lease revenues from telephony tenants have more stable income characteristics than other tenant types due to the strong end-use customer demand for wireless services.
The transaction is an issuance of notes backed by mortgages representing over 86% of the annualized run rate NCF and guaranteed by the direct parent of the borrowers. Those guarantees are secured by a pledge and first priority perfected security interest in 100% of the equity interest of the borrowers, which own or lease 5,186 wireless communication sites.
The series 2013-1A and series 2013-2A notes are interest-only until their respective anticipated repayment date (ARD). No other principal will be required to be paid prior to the ARD of the applicable series, which is in March 2018 for the 2013-1A class and March 2023 for the 2013-2A class. If the notes are not able to be refinanced on or prior to the ARD for that series, all excess cash flow will be swept to pay down the outstanding principal balance.
RATING SENSITIVITIES
The classes are expected to remain stable based on continued cash flow growth due to annual rent escalations and automatic renewal clauses resulting in higher debt service coverage ratios since issuance. Additionally, cash flow continues to grow with the addition of new tenants to existing tower sites.
DUE DILIGENCE USAGE
No third party due diligence was provided or reviewed in relation to this rating action.
Комментарии