Fitch Ratings has downgraded the senior secured notes issued by Newland International Properties, Corp. (Newland), a Panamanian company established to develop the Trump Ocean Club (TOC) luxury hotel and condominium, as follows:
-- $257.6 million senior secured notes due July 2017; downgraded to 'Dsf' from 'Csf'; RE50%.
Fitch assigns Recovery Estimates (RE) to all classes rated 'CCCsf' or below. REs are forward-looking, taking into account Fitch's expectations for principal repayments on a distressed structured finance security.
KEY RATING DRIVERS
Missed Scheduled Principal Payment: Newland failed to make the January 2015 scheduled semiannual principal payment of $23.4 million. The company made the scheduled interest payment of $9.45 million on the payment date. Fitch's rating addresses timely payment of principal and interest on a semiannual basis.
The 'Dsf' rating will be withdrawn within 11 months of today's date.
TRANSACTION SUMMARY
The transaction is mainly backed by (i) a first priority mortgage on the real property owned by Newland; (ii) all cash, installment payments and unit purchase agreements from property sales; (iii) a first priority lien on all Newland accounts and all deposits therein; (iv) the Trump license agreement; (v) Newland's rights to all other revenues from the operation of the project, including: (a) revenues from the operation, sale and/or lease of the Casino, and hotel amenities such as restaurants and spa, and (b) all of Newland's rights to the Beach Club (BC) and Newland's rights to the BC Ferry, BC Ferry Payment and the BC Senior Loan, as applicable; and (vi) 100% of the shares in Newland.
The $257.6 million senior secured notes due 2017 replaced the defaulted $220 million senior secured notes due November 2014 on July 3, 2013. The outstanding balance of the restructured notes due 2017 is $198.9 million.
Additional information is available at www.fitchratings.com.
Applicable Criteria and Related Research:
--'Global Structured Finance Rating Criteria' (August 4, 2014).
Additional Disclosure
Solicitation Status
http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=965455
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