OREANDA-NEWS. The rating is based on close business ties between the Company’s owners and BFG-Credit Bank and the resulting high probability of re-financing in the event of unfavourable macro-economic developments.

Constraining factors include a possible decline in demand for commercial real estate in response to deteriorating macro-economic conditions in Russia; the relatively high average price of floor space in the Praga Retail Centre; a high debt burden; and limited financial transparency.

OOO IK Transprogress [trs. Transprogress Investment Company LLC] was set up in 2011 and belongs to the High Street real estate development group, which has close ties to BFG-Credit Bank. The Company owns the 14 000 m2 Praga Retail Centre located in Moscow at Rossoshanski proezd 3. The facility opened late last year.

The Praga centre is the main component of assets, while liabilities consist mainly of loans from BFG-Credit Bank. Over and above its own R1.19bn in debt the Company has guaranteed loans to other structures that have also invested in the Praga project; these guarantees total R3.19bn. The debt burden is high. Risk sensitivity is likewise high, reflecting conditions in the real estate market.

Strategy calls for the sale of floor space in the Praga centre in small lots up until the end of 2015.