Research Update: CBAC Borrower LLC Outlook Revised To Negative, 'B-' Issuer Credit Rating Affirmed; Secured Debt Rating Lowered To 'B-'

Operating performance at CBAC Borrower LLC's Horseshoe Baltimore property continued to deteriorate in the third quarter, which we believe heightens liquidity risks over the next few quarters if operating performance does not stabilize. We have revised the outlook to negative from stable and affirmed our 'B-' issuer credit rating on the company. At the same time, we revised our recovery rating on CBAC's secured debt to '3' from '2' because we reassessed our assumed enterprise value in our simulated default scenario. As a result of the revised recovery rating, we lowered our issue-level rating on the debt one notch to 'B-', from 'B'. The negative outlook reflects our forecast for greater EBITDA declines than we previously anticipated, heightening the risk

...- Operating performance at CBAC Borrower LLC's Horseshoe Baltimore property continued to deteriorate in the third quarter, which we believe heightens liquidity risks over the next few quarters if operating performance does not stabilize. - We have revised the outlook to negative from stable and affirmed our 'B-' issuer credit rating on the company. - At the same time, we revised our recovery rating on CBAC's secured debt to '3' from '2' because we reassessed our assumed enterprise value in our simulated default scenario. As a result of the revised recovery rating, we lowered our issue-level rating on the debt one notch to 'B-', from 'B'. - The negative outlook reflects our forecast for greater EBITDA declines than we previously anticipated, heightening the risk that CBAC's liquidity position could become impaired if EBITDA does not stabilize in early 2020....

Research Update