The ratings on France-based property group Klépierre S.A. primarily reflect Standard&Poor's Ratings Services' view of the strong quality of cash flow that the group's large and diversified portfolio generates, the high barriers to entry in its main markets because of generally tight regulation, and its strong position and solid expertise in the ownership and management of shopping center galleries. These strengths are offset, in our opinion, by the group's financial risk profile, which we consider to be intermediate; the real estate industry's inherent cyclicality and capital intensity; and poor performance of assets in Hungary and Portugal. The quality of Klépierre's mostly resilient retail assets underpins the group's business risk profile, which we view as strong under our criteria.
