OREANDA-NEWS. On 23 May 2008 Credit-Rating, a nationally recognized credit rating agency in Ukraine announced that it assigned a long-term credit rating of uaCCC to registered housing bonds (series H-K) to be issued by Kiev-based Kyivska Nerukhomist LLC (`issuer` or `company`). The amount of the issue is UAH88.1m, with 3-year original maturity. The company`s principal activity is investing and construction. Today the company as a customer constructs an office and residential complex with installed parking located in the city of Kiev. In the course of analysis Credit-Rating considered issuer`s financial statements for 2003-2007 and its other inside information.

An obligor or a debt liability with uaCCC credit rating is characterized with the VERY LOW creditworthiness as compared to other Ukrainian obligors or debt liabilities. There is a default possibility.

Factors maintaining the credit rating

The amount of funds invested in construction of the office and residential complex with installed parking located 83, Antonovitcha St., Kiev, which premises to redeem the bond issue made up UAH13.6m as of beginning of March 2008.

The demand and prices for real estate have been constantly growing over the past few years in Kiev.

Factors constraining the credit rating

The issuer does not have experience in investment and construction projects, neither in housing bonds redemption.

The amount of the housing bond issue of UAH88.1m exceeds the amount of issuer`s assets as of Dec. 31, 2007 of UAH42.4m coupled with issuer`s negative equity of (UAH2.0m).

Issuer`s liabilities on the discount bonds of A-G series amounted of their overall face value of UAH166.1m (the amount of the bonds placed is UAH43.7m as of Dec. 31, 2007), which mature in the period from February 2009 to August 2011; the redemption of the upcoming bond issue is to occur in June-December 2011.

High specific gravity of non-specialized assets (securities) in issuer`s asset structure (33% as of Dec. 31, 2007).

Instability in legislation and tax environment controlling both the construction industry and project financing.