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NEW YORK CITY-The senior unsecured debt of Bradley Operating LP, the operating partnership of Bradley Real Estate Inc., Northbrook, IL, has been lowered to Ba2 from Baa3 by Moody’s Investors Service following its merger into Heritage Realty Investment Trust, Boston. Heritage, one of the largest neighborhood and community shopping center REITs, now owns 151 properties with more than 23 million sf in 27 states.

Heritage’s increased size, larger portfolio, strong institutional sponsorship with the New England Teamster and Trucking Industry Pension Fund and Prudential Insurance, which own the majority of its preferred and common stock, should help to support its long-term growth, Moody’s noted. But, post-merger integration risks, its multiple market expansion strategy and challenges in the retail industry pose risks.

Other factors that influenced the rating are Heritage’s complex organizational and legal structure, its need to combine operating and accounting systems and its limited operating history as a REIT. Although senior management is experienced and knowledgeable, according to Moody’s, it has not been together for very long and has yet to demonstrate its ability to add value to a large, diverse property portfolio.

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