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POAH earns A+ credit rating from Standard and Poor’s

February 8, 2022

The Loop under construction

Boston, MA – Standard and Poor’s (S&P) Global Ratings, one of the leading providers of credit ratings in the country, has assigned its A+ credit rating to Preservation of Affordable Housing Inc (POAH), a nonprofit developer, owner, and operator of more than 12,000 affordable housing apartments across 11 states and the District of Columbia. The high credit rating will allow POAH to issue General Obligation bonds to attract more investments in its low- and moderate-income housing across the country as it seeks to increase its portfolio by 25% over the next five years.

POAH's mission is to preserve, create and sustain affordable, healthy homes that support economic security, racial equity, and access to opportunity. POAH was founded in 2001 and recently celebrated its 20th anniversary as one of the leading affordable housing providers in the country.

The S&P credit agency cited the following in assigning the A+ rating:

  • Extremely strong management, with an experienced and dedicated board, senior and executive staff and a detailed multi-year strategic plan with measurable goals that support its mission and reflect its values;
  • Very strong enterprise risk profile, supported by our assessment of very strong market dependencies and low industry risk;
  • Strong financial risk profile characterized by adequate financial performance and debt profile assessments based on average earnings before interest, taxes, depreciation and amortization (EBITDA) to adjusted revenues … and POAH's extremely strong liquidity assessment; and
  • Focus on low-income social housing initiatives coupled with its proven community partnerships and ability to fulfill strategic priorities that, in our view, will support fiscal and operational performance in line with the rating level through economic cycles.

“The S&P rating will provide broader access to new sources of capital that will complement our current long-term capital relationships,” said Randy Parker, POAH Managing Director/Chief Financial Officer. “As POAH responds to the urgent demand for affordable housing - flexible, lower-cost and longer-term capital is essential in meeting that need.”

According to the S&P report “… formalized financial return requirements, property-level risk assessments, and a comprehensive review and approval process help to ensure [the company] makes fiscally responsible expansion and rehabilitation decisions for the portfolio… Finally, POAH's many detailed and well-conceived risk management policies address market, credit, liquidity, program and liability, cybersecurity, succession, regulatory, operational, reputational, property-level maintenance, and climate change risks.”

The report also cited POAH’s “strong relationships with various community development finance institutions, state agencies, nonprofits, and other investors which also provide access to liquidity.”

S&P also looked at the recommendations outlined in the company’s 2022-2026 strategic plan. “Guiding POAH’s operations and informing the pursuit of its mission are its core values of service, opportunity, citizenship, partnership, stewardship, sustainability, advocacy, performance, teamwork, diversity and inclusion, racial equity, accountability, innovation, and impact.”