OREANDA-NEWS. RusRating has assigned a credit rating to OOO TD Glavkachestvo. The rating is "BB" on the international scale and "BBB" on the national scale, in both cases with a negative outlook.

The rating is based on loan guarantees provided by ZAO Likhborski Avtoservis, the market value of whose assets exceed the Company’s debt and annual interest obligations, as well as its own debt and interest obligations (including on all guarantees); plus close business ties between the Company’s owners and BFG-Credit Bank and so a high probability of refinancing in the event of unfavourable macro-economic developments.

Constraining factors include a possible decline in demand for commercial real estate in response to a weakening macro-economic environment in Russia; the absence of current operating revenues; and the resulting high debt burden.

The negative outlook reflects the high (in RusRating’s view) likelihood that the project will be suspended in response to current uncertainty in the Moscow market for commercial real estate, plus a low occupancy rate.

About the Company

OOO TD Glavkachestvo is a limited liability company set up in 2010 and a member of the Imagine Estate development group controlled by Denis Vyacheslavovich Mayakov. It has taken in loans from BFG-Bank and via a number of intermediary firms helped finance the purchase and renovation of the MetroMall2 retail centre in Moscow. Legally the Company has no property rights to any part of the facility, but all loan obligations are backed by guarantees issued by the property owner, ZAO Likhoborski Avtoservis. The 18 800m2 MetroMall2 retail facility (Dmitrovskoye hwy. 62) is located next to the Verkhniye Likhobory station on the Lyublinsko-Dmitrovskaya metro line, which is scheduled to open in 2016.

Assets consist mainly of accounts receivable linked to investments in the MetroMall2 facilities, while most external liabilities are BFG-Credit Bank loans. Liquidity is sufficient. Risk sensitivity is very high.

The strategy adopted by the Company’s owners calls for the sale of small blocks of floor space in the MetroMall2 facility up until June 2015 at a price of R262 000 per square metre. This price is competitive and will cover outstanding debt and interest obligations both at the Company itself and for ZAO Likhoborski Avtoservis, including conditional obligations under guarantees.