RAM Ratings affirms Sunway REIT's AA2 rating and the ratings of debt facilities issued by its funding conduits

RAM Ratings has affirmed the AA2/Stable/P1 corporate credit ratings (CCRs) of Sunway Real Estate Investment Trust (Sunway REIT or the REIT), along with the ratings of debt facilities under its funding vehicles (see table). The suffix (s) indicates that the issue ratings have been enhanced beyond the standalone credit position of the issuers; in this instance, their debt obligations are supported by inter-company payments from the REIT.

Issuer	                                         Facility	                                 Rating/Outlook
SUNREIT Bond Berhad	          RM10 bil Medium Term Note (MTN) Programme (2012/2047)	
	                          - Secured MTN 	                                         AA1(s)/ Stable
	                          - Unsecured MTN	                                         AA2(s)/ Stable
SUNREIT Perpetual Bond Berhad	  RM10 bil Perpetual (Perps) Programme 	                         A1(s)/ Stable
SUNREIT Capital Berhad	          RM3 bil Commercial Paper (CP) Programme (2019/2026)	         P1(s)

The rating of unsecured MTNs mirrors Sunway REIT's long-term CCR, reflecting their senior unsecured position. The secured MTNs are rated a notch above the REIT's long-term CCR to indicate the strong likelihood of recovery in the event of default to reflect the strong recovery prospects for the rated MTNs from the pledged properties. The secured MTNs and CP Programme are subject to a minimum 1.67 times security cover. As of March 2025, this stood at 2.69 times, well above the required threshold. The Perps are rated two notches below the REIT's long-term CCR to reflect the deferrable feature of the coupon payments and the Perps' deeply subordinated position, senior only to common equity.  

The rating affirmations are anchored by Sunway REIT's market position as one of the largest diversified REITs in Malaysia, holding a portfo