Fitch Assigns Final Ratings to American Tower Trust I Secured Tower Revenue
Securities 2013-1A & -2A
CHICAGO -- March 15, 2013
Fitch Ratings has assigned the following ratings and Rating Outlooks to the
American Tower Trust I Secured Tower Revenue Securities, series 2013-1A and
series 2013-2A transaction:
--$500,000,000 class 2013-1A 'AAAsf'; Outlook Stable;
--$1,300,000,000 class 2013-2A 'AAAsf'; Outlook Stable.
The transaction is an issuance of notes backed by mortgages representing over
86% of the annualized run rate net cash flow (NCF) and guaranteed by the
direct parent of the borrowers. Those guarantees are secured by a pledge and
first priority perfected security interest in 100% of the equity interest of
the borrowers, which own or lease 5,195 wireless communication sites, and of
its direct parent, respectively. Both the direct and indirect parents of the
borrowers are special purpose entities.
Key Rating Drivers
Low Leverage: Fitch's NCF on the pool is $392.3 million, implying a Fitch
stressed debt service coverage ratio (DSCR) of 2.36x. The debt multiple
relative to Fitch's NCF is 4.59x, which equates to a debt yield of 21.8%.
Institutional Sponsorship: American Tower Corporation (rated 'BBB-', Outlook
Stable) is a leading independent owner of wireless tower sites and currently
operates over 54,000 towers throughout the United States, Brazil, Chile,
Colombia, Germany, Ghana, India, Mexico, Peru, South Africa and Uganda.
Strong Historical Performance: NCF from the existing collateral has increased
approximately 81.8% since the 2007-1 issuance due to the contractual rent
increases, fixed-cost base structure, and organic growth.
Amortization Post-ARD: The notes will be structured as interest only until the
anticipated repayment date (ARD). If the notes are not able to refinance on or
prior to the ARD for that series, all excess cash flow will be swept to pay
down the outstanding principal balance. Based on actual NCF, the notes would
fully amortize three years after the ARD (or 13 years from closing).
Fitch performed several stress scenarios in which Fitch's NCF was stressed.
Fitch determined that an 88.2% reduction in Fitch's NCF would cause the notes
to break even at 1.0x DSCR on an interest-only basis. Fitch evaluated the
sensitivity of the ratings and a 16% decline in NCF would result in a one
category downgrade to 'AAsf', while a 42% decline would result in a downgrade
to below investment-grade.
Key Rating Drivers and Rating Sensitivities are further described in the
presale report, which is available to all investors on Fitch's web site
Additional information is available at www.fitchratings.com. The ratings above
were solicited by, or on behalf of, the issuer, and therefore, Fitch has been
compensated for the provision of the ratings.
Applicable Criteria and Related Research:
--'Global Structured Finance Rating Criteria', June 6, 2012;
--'Criteria for Analyzing U.S. Wireless Tower Transactions', Dec. 4, 2012;
--'Criteria for Special-Purpose Vehicles in Structured Finance Transactions',
May 30, 2012.
Applicable Criteria and Related Research
Global Structured Finance Rating Criteria
Criteria for Analyzing U.S. Wireless Tower Transactions
Criteria for Special-Purpose Vehicles in Structured Finance Transactions
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Adam Ott, +1-312-368-2094
Fitch Ratings, Inc.
70 West Madison
Chicago, IL 60602
Robert Vrchota, +1-312-368-3336
Sandro Scenga, +1-212-908-0278
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