Standard&Poor's Ratings Services lowered its rating on Minneapolis, Minn.'s Section 8 asst multifamily housing revenue bonds series 1993 (Olson Townhouses) to 'BBB' from 'A'. The downgrade reflects our view of the following: Decline in debt service coverage level to 1.09x maximum annual debt service (MADS) level based on 2008 audited financial statements; No rental increase received by the project since 2006; and Increase in expenses leading to deterioration in the expense ratio. However, in our opinion, the above weaknesses are offset by the following strengths: Contract rent below fair market rent (FMR); Debt service reserve fund (DSRF) funded at maximum annual debt service; and Strong occupancy rates at the property with a waiting list of 211 families. In
