FORTRESS REIT LIMITED - Change of credit rating by Moody's Investors Service

Change of credit rating by Moody's Investors Service

FORTRESS REIT LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2009/016487/06)
JSE share codes: FFA ISIN: ZAE000248498
                 FFB ISIN: ZAE000248506
Bond Company code: FORI
(Approved as a REIT by the JSE)
(“Fortress” and “the Company”)


CHANGE OF CREDIT RATING BY MOODY’S INVESTORS SERVICE


Security holders are advised that Moody’s Investors Service Inc (“Moody’s”) has downgraded Fortress’ corporate
family rating (“CFR”) to Ba2 from Ba1 and has affirmed the short-term rating of Not Prime. Concurrently, Moody’s
has downgraded the Company’s long-term CFR national scale rating to A1.za from Aa3.za and affirmed the short-term
national scale rating of Prime-1.za. Moody’s rating outlook remains negative.

As detailed in its report, Moody’s rationale for the downgrade is based, inter alia, on (i) Fortress’ exposure to the current
weak South African economy, (ii) the potential impact of COVID-19 on the operating environment and consequential
growth of the Company, (iii) Moody’s conservative methodology in assessing a company’s liquidity, (iv) Fortress’s
listed property investments which expose the Company to market volatility, and (v) a low percentage of unencumbered
investment properties held by Fortress.

Fortress is of the view that Moody’s approach remains excessively conservative when assessing the Company’s liquidity
despite Moody’s noting that Fortress has again successfully refinanced matured bank debt over the last 12 months and
the Company’s solid access to a diversified group of local banks. Moody’s negative outlook reflects the risks related to
the refinancing of debt becoming due in the next 12 months as well as the anticipated wider negative credit implications
of COVID-19.

The full report is available online at https://www.moodys.com/research/Moodys-downgrades-Fortress-REIT-Limited-
to-Ba2A1za-outlook-negative--PR_422104

9 April 2020
                                                                                              
Debt sponsor                                 Lead sponsor                             Joint sponsor

Rand Merchant Bank                           Java Capital                             Nedbank Corporate and Investment Banking
(A division of FirstRand Bank Limited)
          

Date: 09-04-2020 11:00:00
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