The rating is defined as "satisfactory capability for payment of debt instrument issue on both principal and interest ."
Philratings said the effect of industry characteristics and market composition may be more pronounced and the variability in earnings and profitability may result in changes in debt protection measures.
In giving the rating, Philratings positively viewed the entry of Ayala Land, Inc. (ALI) and Greenfield Development Corp., as inventors in Bonifacio Land Corp., shareholder of FBDC.
Philratings said ALI’s proven track record as a developer and its solid financial standing augur well for FBDC. It noted that upon ALI’s entry, the Zobel-owned real estate development firm provided funds for FBDC’s ongoing project, Bonifacio Ridge.
"Going forward, however, how FBDC will be made to fit into ALI’s over-all development plan, bears close watching. As the acquisition of shares in BLC has been quite recent, specific plans are still being firmed up, Philratings said.
Philratings noted that while the property market continues to be weak, improving earnings and cash flows will remain to be a challenge for FBDC. Although the company has a strong capital base, it will have to manage its debt obligations in the short to medium-term with great resourcefulness, Philratings said.
FBDC is a 55-45 joint venture between Metro Pacific Corp. and the state-run Bases Conversion Development Authority tasked to develop the former military base into a premier central business district. – Zinnia dela Peña