Fitch Ratings has affirmed net lease retail REIT Four Corners Property Trust’s (FCPT) Long-Term Issuer Default Rating (IDR) at BBB-, and Four Corners Operating Partnership, L.P.’s Long-Term IDR and underlying issuances outstanding at BBB-. The rating outlook for the long-term ratings is stable.

The affirmations and stable outlook reflect the rating agency’s expectations that FCPT will sustain metrics appropriate for the rating. These include leverage below 6.5x and an unencumbered asset/unsecured debt ratio at or above 2.0x, along with the expectation that the REIT will maintain stable operating performance over the long term. 

FCPT, whose properties are mainly in the restaurant sector, collected 99.7% of its rents during 2020 and didn’t receive any requests for deferrals last quarter. Accordingly, Fitch expects rent collections to maintain above 99% over the course of 2021.

Furthermore, Fitch said it expects FCPT’s exposure to Darden Restaurants—the REIT was spun off from Darden in 2015—to decrease from 66% to the mid-50% range as it continues to acquire an “outsized proportion of non-restaurant properties,” including banks, medical retail and auto repair and supply shops.