(Editor's Note: This report was revised on July 19, 2024, to correct criteria citations for several rated issues.)
S&P Global Ratings' U.S. Public Finance Housing rating actions (including outlook revisions) for first-quarter 2024 consisted of three positive rating actions, three negative rating actions, and 47 affirmations (see table 1).
First-Quarter Rating Actions
The upgrade on one military housing project reflected improved financial and operating performance from increasing net rent collections following Basic Allowance for Housing (BAH) revenue increases. The outlook revision for one federally enhanced housing credit was based on the recent outlook revision of Transamerica, the bonds' guaranteed investment contract (GIC) provider, to stable from negative. The other outlook revision was related to an age-restricted rental housing bond project, reflecting improved debt service coverage from annual increases in net operating income due to improvement in average occupancy that outpaced increases in expenses.
We took negative rating actions on one rental housing bond project with three liens in the age-restricted subsector (see table 2). All three liens were downgraded, with the two subordinate liens downgraded due to nonpayment of bond principal on their debt service payment due dates. The first lien was downgraded, reflecting our view that the bonds are highly vulnerable to nonpayment given depleted transaction reserves.
Affirmations constituted 47 out of 69 total rating actions, or about 68% of rating actions, during first-quarter 2024, which is lower than fourth-quarter 2023 (77%). As of April 2024, about 95% of ratings carry stable outlooks, higher than the previous quarter (87%), reflecting resiliency and strong metrics in our rated universe. (For more information, see recent commentaries in Related Research.) We typically review the parity rating on an issuer in conjunction with any new-money or refunding transactions. During the first quarter, we rated 34 new sales in conjunction with affirmations (see table 3). This pace has not changed when compared with the new sale activity in fourth-quarter 2023.
We also rated 16 new issuers in the first quarter 2024 (see table 4):
- Four were rated under our "Methodology For Rating U.S. Public Finance Rental Housing Bonds" criteria, published April 15, 2020;
- Six were rated under our "U.S. Federally Enhanced Housing Bonds Rating Methodology" criteria, published Nov. 12, 2019;
- Four were rated under our "Assigning Ratings To Bonds In The U.S. Based On Escrowed Collateral" criteria, published Nov. 30, 2012;
- One was rated under our "Methodology For Rating Public And Nonprofit Social Housing Providers" criteria, published June 1, 2021; and
- One was rated under our "Methodology And Assumptions: Housing Finance Agencies And Social Enterprise Lending Organizations" criteria, published Dec. 27, 2016.
Table 1
Positive rating actions--first-quarter 2024 | |||||||
---|---|---|---|---|---|---|---|
Issue | State | Sector | Prior rating | Current rating | Prior outlook | Current outlook | Reason for rating |
Fort Drum Mountain Comnty Homes LLC, NY Military Housing | NY | Rental Housing Bonds (RHB) - Military | BBB+ | A- | Stable | Stable | Improved financial and operating performance due to increasing net rent collections from BAH revenue growth |
New Mexico Mtg Fin Auth NM Multifamily Insured Section 542(c) 1st LIEN New Mexico 5 Apartment Projects | NM | Federally Enhanced Housing (FEH) - Multi-Family Stand Alone | A+ | A+ | Negative | Stable | Recent outlook revision of GIC provider (Transamerica) |
QSH/Sanders Glen LLC, GA Affordable Housing Sanders Glen Project | GA | Rental Housing Bonds (RHB) - Age Restricted | B- | B- | Negative | Stable | Improved debt service coverage following increases in net operating income |
Table 2
Negative rating actions--first-quarter 2024 | ||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Issue | State | Sector | Prior rating | Current rating | Prior outlook | Current outlook | CreditWatch | Reason for rating | ||||||||||
Great Lakes Senior Living Communities IL, First Tier | IL | RHB - Age Restricted | CCC- | CC | N.M. | Negative | Bonds are highly vulnerable to nonpayment given depleted transaction reserves after consecutive draws for subordinate bond interest payments | |||||||||||
Great Lakes Senior Living Communities IL, Second Tier | IL | RHB - Age Restricted | CCC- | D | N.M. | N.M. | Nonpayment of bond principal on the Jan. 1, 2024, debt service payment date | |||||||||||
Great Lakes Senior Living Communities IL, Third Tier | IL | RHB - Age Restricted | CCC- | D | N.M. | N.M. | Nonpayment of bond principal on the Jan. 1, 2024, debt service payment date | |||||||||||
N.M.--Not meaningful. |
Table 3
Affirmations and new sales--first-quarter 2024 | |||||
---|---|---|---|---|---|
Issue | State | Sector | Rating | Outlook | Type of review |
Alaska Hsg Fin Corp, AK General Mortgage Revenue Bond II (GMRB) | AK | MRBP | AA+ | Stable | New sale |
Arkansas Dev Fin Auth, AR Single Family Multi-Agency MBS 1995 Resolution | AR | MRBP | AA+ | Stable | New sale |
California Dept of Vet Affairs, CA Home Purchase Revenue Bonds | CA | MRBP | AA | Stable | Full review |
California Dept of Vet Affairs, CA Veterans General Obligation Bonds (CA St GO) | CA | MRBP | AA+ | Stable | Full review |
Colorado Hsg & Fin Auth, CO Single Family Mortgage Bonds Class II | CO | MRBP | AA+ | Stable | New sale |
Colorado Hsg & Fin Auth, CO Single Family Mortgage Bonds Class II | CO | MRBP | AA+ | Stable | New sale |
Colorado Hsg & Fin Auth, CO Single Family Mortgage Bonds Class III (GO) | CO | MRBP | AA | Stable | New sale |
Colorado Hsg & Fin Auth, CO Single Family Mortgage Bonds Class III (GO) | CO | MRBP | AA | Stable | New sale |
Colorado Hsg & Fin Auth, CO Single Family Whole Loan - Single Family Mortgage Bonds Indenture | CO | MRBP | AAA | Stable | New sale |
Colorado Hsg & Fin Auth, CO Single Family Whole Loan - Single Family Mortgage Bonds Indenture | CO | MRBP | AAA | Stable | New sale |
Columbus Metropolitan Housing Authority, OH | OH | Social Housing Provider (SHP) ICR | A+ | Stable | New sale |
Connecticut Hsg Fin Auth, CT General Bond Resolution | CT | MRBP | AAA | Stable | New sale |
Cuyahoga Metropolitan Hsg Auth (City of), OH General Obligation ICR | OH | SHP ICR | A+ | Stable | Full review |
DeKalb Cnty Hsg Auth, GA General Obligation ICR | GA | SHP ICR | A+ | Stable | New sale |
District of Columbia Hsg Auth, DC HUD Capital Fund Financing | DC | Capital Fund Financing Program (CFFP) | A+ | Stable | Full review |
GMAC Commercial Military Hsg Tr XXI, TX Military Housing Fort Bliss/White Sands Missile Range | TX | RHB - Military | BBB+ | Stable | Full review |
Howard Cnty Hsg Commission, MD General Obligation ICR | MD | SHP ICR | A+ | Stable | New sale |
Iowa Fin Auth, IA MBS 1991 SFMBS Resolution | IA | MRBP | AAA | Stable | New sale |
Jacksonville Hsg Auth, FL General Obligation ICR | FL | SHP ICR | A+ | Stable | New sale |
King Cnty, WA Limited Tax General Operating Pledge and King Cnty Hsg Auth, WA General Obligation | WA | SHP ICR | AAA | Stable | New sale |
Maine St Hsg Auth, ME Mortgage Purchase Program Resolution | ME | MRBP | AA+ | Stable | New sale |
Maine St Hsg Auth, ME Mortgage Purchase Program Resolution | ME | MRBP | AA+ | Stable | New sale |
Massachusetts Hsg Fin Agy MA Section 266 1st LIEN 2014B | MA | MRBP | AA+ | Stable | Full review |
Michigan St Hsg Dev Auth, MI General Resolution | MI | MRBP | AA+ | Stable | New sale |
Minnesota Housing Finance Agency, MN Single Family | MN | MRBP | AA+ | Stable | New sale |
Minnesota Housing Finance Agency, MN Single Family | MN | MRBP | AA+ | Stable | New sale |
Minnesota Senior Living, LLC, MN Affordable Housing Senior Living Proj | MN | RHB - Age Restricted | BB- | Stable | Full review |
Minnesota Senior Living, LLC, MN Affordable Housing Senior Living Proj 2nd Lien | MN | RHB - Age Restricted | B | Stable | Full review |
Minnesota Senior Living, LLC, MN Affordable Housing Senior Living Proj 3rd Lien | MN | RHB - Age Restricted | B- | Stable | Full review |
Missouri Hsg Dev Comm MO Insured Section 221(d)3, Section 221(d)4, Section 542(c) 1st LIEN 2014 Multi Family Indenture | MO | MRBP | AA+ | Stable | Full review |
Missouri Hsg Dev Comm MO Insured Section 221(d)3, Section 221(d)4, Section 542(c) 1st LIEN 2000 Multifamily Indenture | MO | MRBP | AA+ | Stable | Full review |
Missouri Hsg Dev Comm, MO First Place Homeownership Loan Program | MO | MRBP | AA+ | Stable | New sale |
Nebraska Invest Fin Auth, NE SFHRB Resolution | NE | MRBP | AAA | Stable | New sale |
Nevada Hsg Div, NV Single Family Multi-Agency MBS 2008 MBS Resolution | NV | MRBP | AA+ | Stable | New sale |
New York City Hsg Dev Corp, NY Multi-Family Whole Loans - Multifamily General Resolution | NY | Mortgage Revenue Bond Program (MRBP) | AA+ | Stable | New sale |
North Carolina Hsg Fin Agy, NC Single Family MBS Whole Loan - 1998 Trust Agreement | NC | MRBP | AA+ | Stable | New sale |
Pennsylvania Hsg Fin Agy, PA Single Family Mortgage Revenue Bonds w GO | PA | MRBP | AA+ | Stable | New sale |
Rhode Island Housing & Mortgage Finance Corporation, RI Homeownership Opportunity Bond Resolution | RI | MRBP | AA+ | Stable | New sale |
Sacramento Cnty Hsg Auth, CA FNMA Standby Agreement Cottage Estates | CA | FEH Multi-Family Stand Alone | B+ | Stable | Full review |
South Dakota Hsg Dev Auth, SD Single Family Whole Loan - Homeownership Mortgage Bond Resolution (1977 Indenture) | SD | MRBP | AAA | Stable | New sale |
Tennessee Hsg Dev Agy, TN Single Family Whole Loan - 2013 General Residential Finance Program | TN | MRBP | AA+ | Stable | New sale |
Texas Department of Housing & Community Affairs Single Family Mortgage Rev Bnd Indenture | TX | MRBP | AA+ | Stable | New sale |
Virginia Housing Development Authority VA Rental Housing Bonds w GO | VA | MRBP | AA+ | Stable | New sale |
Virginia Hsg Dev Auth, VA Commonwealth Mortgage Bonds w GO | VA | MRBP | AAA | Stable | New sale |
West Virginia Hsg Dev Fd, WV Housing Finance Bond w GO | WV | MRBP | AAA | Stable | New sale |
Wisconsin Hsg & Econ Dev Auth, WI Home Ownership Revenue Bonds (1988 Resolution) w GO | WI | MRBP | AA+ | Stable | New sale |
Wisconsin Hsg Pres Corp, WI General Obligation ICR | WI | Social Housing Provider (SHP) ICR | AA- | Stable | Full review |
Table 4
New issuers--first-quarter 2024 | ||||
---|---|---|---|---|
Issue | State | Sector | Rating | Outlook |
Arc70 Capital LLC, CA, Arc70 Capital Series 2024-1 Class A Certificates | CA | RHB - Multifamily Static Pool | BBB | Stable |
Arc70 Capital LLC, CA, Arc70 Capital Series 2024-1 Class B Certificates | CA | RHB - Multifamily Static Pool | A+ | Stable |
CIC Calavera, L.P., CA Fannie Mae Mariposa Apartments | CA | Escrow Collateral | AA+ | Stable |
Escambia County Hsg Finance Auth, 5465 Curry Ford L.P., Hollow Brook Apartments | FL | Escrow Collateral | AA+ | Stable |
Florida Housing Finance Corp., Brownsville Village V Ltd. | FL | Escrow Collateral | AA+ | Stable |
Freddie Mac VA Housing MFFHLMC 1st Lien Multifamily Mortgage Participation Certs WE5052 | VA | FEH - Freddie Mac Multifamily Pool | AA+ | Stable |
Freddie Mac VA Housing MFFHLMC 1st Lien Multifamily Mortgage Participation Certs WE6103 | VA | FEH - Freddie Mac Multifamily Pool | AA+ | Stable |
Freddie Mac VA Housing MFFHLMC 1st Lien Multifamily Mortgage Participation Certs WE6104 | VA | FEH - Freddie Mac Multifamily Pool | AA+ | Stable |
Freddie Mac VA Housing MFFHLMC 1st Lien Multifamily Mortgage Participation Certs WE6108 | VA | FEH - Freddie Mac Multifamily Pool | AA+ | Stable |
Freddie Mac VA Housing MFFHLMC 1st Lien Multifamily Mortgage Participation Certs WE6111 | VA | FEH - Freddie Mac Multifamily Pool | AA+ | Stable |
Freddie Mac VA Housing MFFHLMC 1st Lien Series ML21 | VA | FEH - Freddie Mac Multifamily Pool | AA+ | Stable |
Jacksonville Hsg Auth, FL General Obligation | FL | SHP ICR | A+ | Stable |
Michaels Military Housing NJ, Military Housing Revenues | NJ | RHB - Military | BBB+ | Stable |
Monterey Bay Military Housing, LLC, CA Military Housing | CA | RHB - Military | A+ | Stable |
NeighborWorks Capital, MD General Obligation ICR | MD | CDFI ICR | A+ | Stable |
Santaluz Family Apartments, L.P., CA Fannie Mae Rancho Del Norte Apartments | CA | Escrow Collateral | AA+ | Stable |
Analyses associated with positive rating actions
- New Mexico Mortgage Finance Authority, March 19, 2024
- New Hope Cultural Education Facilities Finance Corp., Texas; QSH/Sanders Glen LLC, Feb. 12, 2024
- GMAC Commercial Military Housing Trust XIX, Colorado Fort Drum Mountain Community Homes LLC, New York, March 13, 2024
Analyses associated with negative rating actions
- Great Lakes Senior Living Communities, Illinois; Arizona Industrial Development Authority, March 14, 2024
Related Research
- U.S. Public Housing Authorities Capital Fund Ratings Remain Resilient Amid Higher Appropriations And No Planned Borrowing, March 14, 2024
- Military Rental Housing 2024 Outlook: Bond Sector Stable Amid Slow Recruitment and Higher Expenses, March 7, 2024
- U.S. Public Finance Housing Outlook 2024: A Stable Foundation Despite Emerging Risks And Slower Economic Growth, Jan. 24, 2024
- U.S. Social Housing Providers Have The Foundation to Insulate Against New Post-Pandemic Risks, Oct. 4, 2023
- U.S. Housing Finance Agencies 2022 Medians: Strong Metrics, Balance Sheets Reinforce Credit Quality, Sept. 19, 2023
- U.S. Mortgage Revenue Bond Program Medians: Strong Credit Quality Keeps The House In Order, Sept. 12, 2023
- What U.S. CDFI Ratios’ Resilience Through Changing Economic Landscapes Means For Long-Term Credit Quality, Aug. 10, 2023
- U.S. Rental Housing Sector Rating Actions Decline As Finances Stabilize For Most Properties, June 21, 2023
This report does not constitute a rating action.
Primary Credit Analyst: | Shirley Flores, New York (646) 831-2467; Shirley.Flores@spglobal.com |
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Olivia Fellbaum, New York + 1 (212) 438 7428; olivia.fellbaum@spglobal.com | |
Anshul Sharma, Pune; anshul.sharma@spglobal.com |
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