---
title: "Fitch upgrades the outlook for YUEXIU REIT to \"Stable\" due to financial improvement after the sale of property interests"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/265463423.md"
description: "Fitch Ratings has revised the Outlook on Yuexiu Real Estate Investment Trust's Long-Term Foreign-Currency Issuer Default Rating from \"Negative\" to \"Stable,\" affirming its Issuer Default Rating at \"BBB-.\" This move reflects the improvement in Yuexiu REIT's financial condition following the sale of a 50% stake in Yuexiu Financial Tower. Despite the rental pressure on office properties, Fitch expects its EBITDA interest coverage ratio to remain above the negative sensitivity threshold, with the loan-to-value ratio improving to around 41%. The base income is expected to decline by 7% and 4% in the next two years, respectively"
datetime: "2025-11-12T07:47:06.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/265463423.md)
  - [en](https://longbridge.com/en/news/265463423.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/265463423.md)
---

> Supported Languages: [简体中文](https://longbridge.com/zh-CN/news/265463423.md) | [繁體中文](https://longbridge.com/zh-HK/news/265463423.md)


# Fitch upgrades the outlook for YUEXIU REIT to "Stable" due to financial improvement after the sale of property interests

Fitch Ratings has revised the outlook on the long-term foreign currency issuer default rating of YUEXIU REIT (00405.HK) from "negative" to "stable," while affirming its issuer default rating at "BBB-," primarily reflecting the improvement in the financial condition of YUEXIU REIT after selling a 50% stake in YUEXIU Financial Tower.

Although the company's office-dominated property portfolio continues to face rental pressure, Fitch expects its recurring EBITDA interest coverage ratio to remain above the negative sensitivity threshold; at the same time, the company's loan-to-value ratio is expected to improve from 45% in the first half of this year to around 41%.

Additionally, Fitch forecasts that the base income (excluding asset disposals) of YUEXIU REIT will decline by 7% and 4% in the next two years, mainly due to the office sector, which accounts for about 55% of the company's revenue. It is anticipated that the company's office rental income will decrease by 8% and 6% in the next two years, as a large amount of new supply will prompt owners to adopt aggressive discount strategies.

In terms of financing costs, the company's average financing cost fell to 3.92% in the first half of this year, and Fitch expects its financing costs to remain at an average level of 3.6% to 3.7% between 2025 and 2026, benefiting from close ties with banks and maintaining smooth financing channels

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