Standard & Poor's Ratings Services said it raised its rating on Lee County Industrial Development Authority, Fla.'s revenue debt, issued for Shell Point Village, one notch to BBB-minus from BB-plus.
The outlook is stable.
The upgrade reflects Standard & Poor's opinion of several fiscal years of very solid operating performance generating improved debt service coverage more in-line with the higher rating, very strong demand across the continuum, and continued unrestricted reserve growth.
The upgrade also incorporates Standard & Poor's opinion that management will likely continue to generate strong operational results over the next several fiscal years based on projections while it continues to grow the balance sheet, coupled with the successful completion of the estuary project.
"We could raise the rating over the outlook's two-year period if management were to maintain operating performance at current levels while incrementally growing the balance sheet with the unrestricted-reserves-to-long-term-debt ratio exceeding 60% and days' cash on hand exceeding 400 days', which management has committed to maintaining over the long term," said Standard & Poor's credit analyst Margaret McNamara. "We could lower the rating or revise the outlook to negative if operating performance were to deteriorate significantly, resulting in a decrease in debt service coverage of less than 2x; if liquidity were to decrease with days' cash on hand decreasing below 250 days'; or if the village were to fail to complete the estuary project."
