Research Update: UPP Bond 1 Issuer PLC Senior Debt Downgraded To 'BBB+'; Outlook Negative

The effects of the COVID-19 pandemic on the U.K. higher education sector remain uncertain at present. In our view, assets without nominations agreements and that have a high proportion of international tenants could be more exposed if social-distancing measures and travel restrictions remain in place over the next few months. Some of the accommodation properties of UPP Bond 1 Issuer PLC's (UPP Bond 1's) portfolio lack nomination agreements and are more exposed to vacancy risk for the 2020/2021 academic year, in our view. We are therefore lowering our ratings on the senior secured debt issued by UPP Bond 1 to 'BBB+' from 'A-'. The negative outlook reflects that we could lower the rating by one or more notches if continuing

...- The effects of the COVID-19 pandemic on the U.K. higher education sector remain uncertain at present. - In our view, assets without nominations agreements and that have a high proportion of international tenants could be more exposed if social-distancing measures and travel restrictions remain in place over the next few months. - Some of the accommodation properties of UPP Bond 1 Issuer PLC's (UPP Bond 1's) portfolio lack nomination agreements and are more exposed to vacancy risk for the 2020/2021 academic year, in our view. - We are therefore lowering our ratings on the senior secured debt issued by UPP Bond 1 to '###+' from 'A-'. - The negative outlook reflects that we could lower the rating by one or more notches if continuing social-distancing measures and travel disruptions erode revenue by more than we currently assume....

Research Update