Moody's Investors Service has published an updated methodology that details how it rates real estate investment trusts (REITs) and other commercial real estate firms globally.
The New York-based firm does not anticipate any changes to public ratings as a result of changes to this methodology.
The new methodology includes an explanation of changes to the ratings scorecard, a grid of factors and sub-factors that suggests a rating and which Moody's analysts complete as part of the rating committee process. Changes in the methodology include that the sub-factors used in the scorecard are now weighted differently to better reflect the degree of influence each sub-factor has on the overall rating. Previously, all of the scorecard sub-factors were weighted equally.
Also, the possible implied rating outcomes reflected in the scorecard have been widened. The outcomes now range from Aa down to Ca, whereas in the previous methodology the lowest implied rating category of the range was single B.
You can check out the updated methodology -- "Global Rating Methodology for REITs and Other Commercial Property Firms" -- on Moodys.com, but you must be registered to download it.