Fitch Affirms Brentwood, Missouri's TIF Revs (Brentwood Promenade Project) at 'A-'; Outlook Stable

CHICAGO--(BUSINESS WIRE)--During the course of routine surveillance, Fitch Ratings affirms the rating on the City of Brentwood, Missouri's approximately $3.955 million outstanding tax increment revenue refunding (TIF) bonds (Brentwood Promenade Project), series 2002 at 'A-'. The Rating Outlook is Stable.

The 'A-' rating primarily reflects the near-term repayment of outstanding debt under a special mandatory redemption provision with no additional bonds permitted under the indenture, as well as the maintenance of a well-funded debt service reserve fund. In addition, the tax increment district (the district) has an established history of revenue generation, supported by high tenant occupancy. These strengths offset the relatively small size of the tax base and the volatility of economically sensitive sales taxes, the major source of debt repayment. Surplus incremental revenue has allowed for the rapid redemption of debt and all bonds are expected to be repaid in full within the next six months. The Stable Rating Outlook assumes the continuation of the accelerated debt repayment schedule and the sustained demand for the district's retail offerings.

Located in St. Louis County (rated 'AAA', with a Stable Outlook by Fitch), approximately nine miles west of the city of St. Louis, Brentwood spans just 2.6 miles. The Brentwood Promenade retail center was created in 1998 and is currently fully occupied. Tenants in the center include Bed Bath & Beyond, Cost Plus and Target Greatland, among others. Target Greatland recently expanded and added a grocery component. Additionally, a Micro Center recently opened and is projected to generate revenues in excess of $30 million and will further stabilize the center. Direct competition throughout the market area is limited.

The bonds are payable from the district's incremental payments in lieu of taxes and sales and utility taxes (economic activity tax revenues). Revenues provide at least 1.8 times coverage and the district has been paying down additional debt through the special redemption provision. Officials anticipate that all of the district's debt will be retired no later than October 2010, nine years earlier than the stated maturity.

Additional information is available at 'www.fitchratings.com'.

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