Moody's Investors Service has revised the outlook on the City of Vancouver’s triple A debt rating to stable from negative.
The outlook change is prompted by Moody’s view of the city’s declining risk exposure thanks to the expected revenue from sales of condo units at the Olympic Village.
Moody’s stated that the city’s debt levels, which had increased significantly with the financing related to the development, have stabilized and reduced over the past six months and are expected to continue to decline.
Jennifer Wong, lead analyst for the City of Vancouver, said: “While debt has increased related to financing for the Olympic Village construction, the construction of the entire project has been completed.
“As of May 2011, 544 units out of a total 856 market units had been sold or rented out. Thus, while risks remain regarding the value and timing of proceeds of the remaining units and transferred properties, we believe that Vancouver’s debt burden will continue to decline over the next few years.”
The revised outlook report cited the city’s stable revenue base, improved liquidity and debt declines, from 107% in 2009 to 98% in 2010 as factors in the rating change.
Jennifer Harrison