Ratings Downgraded for Nationwide Health

Moody’s Investors Service, noting that Nationwide Health Properties Inc. is exposed to weak health care operators, said Wednesday it has downgraded ratings on the Newport Beach firm’s debt and preferred stock.

Bankrupt operators are now responsible for approximately 14% of the revenue of Nationwide, a real estate investment trust that invests in health care facilities. Although these operators continue to make lease payments, the outcome of their bankruptcy proceedings remains uncertain, Moody’s said.

Moody’s cut Nationwide’s debt rating to Baa3 from Baa2, while lowering the preferred stock rating to ba2 from baa3.

The rating agency also said a surplus of assisted living facilities resulted in lower occupancy at some of the company’s facilities.

Moody’s noted that Nationwide’s management is attempting to deal with challenges in the health care industry by scaling back on acquisitions and raising cash by waiving prepayment penalties on its mortgages. The company also is selling selective assets, earmarking the proceeds for debt reduction.

Nationwide’s common stock closed at $14.75, up 44 cents a share, on the New York Stock Exchange.