Safehold (SAFE) Is Up 8.2% After S&P Upgrade and $400 Million Loan Refinance – What’s Changed

• Earlier this week, Safehold Inc. announced it closed a US$400 million unsecured term loan set to mature in November 2030, replacing US$227 million in secured debt and boosting liquidity to US$1.3 billion.
• Shortly after, S&P Global Ratings upgraded Safehold’s credit rating to A-, highlighting the company’s solid asset quality and resilience in the commercial real estate sector.
• We'll explore how Safehold’s improved credit rating may support its capital access and influence the company’s investment outlook going forward.

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Safehold Investment Narrative Recap

To own shares in Safehold, an investor typically needs conviction in the scalability of ground leases as a modern real estate capital solution and in Safehold’s ability to originate new deals despite evolving commercial real estate cycles. While the recent US$400 million unsecured term loan and S&P Global’s upgrade to A- highlight balance sheet strength and could support Safehold’s capital access, they may not fundamentally shift the primary short-term catalyst: continued adoption of the ground lease model. The biggest current risk remains macroeconomic volatility and its effect on new originations; this news does not materially reduce that uncertainty. Among recent announcements, the completion of an unsecured US$2.0 billion revolving credit facility earlier this year stands out as particularly relevant. This move, combined with the new term loan, further expands liquidity and could offer flexibility to pursue new deals if ground lease demand accelerates, directly linking to Safehold’s main business catalysts. However, investors should also be aware that persistent delays in commercial real estate activity remain a material risk to Safehold’s growth story, especially if...

Read the full narrative on Safehold (it's free!)

Safehold's narrative projects $449.9 million revenue and $144.1 million earnings by 2028. This requires 4.6% yearly revenue growth and a $41.4 million increase in earnings from $102.7 million currently.

Uncover how Safehold's forecasts yield a $20.00 fair value, a 42% upside to its current price.

Exploring Other Perspectives

Three fair value estimates from the Simply Wall St Community range from US$12.57 to US$20 per share, reflecting wide divergence in outlooks. Opinions vary, and while some see potential undervaluation, the key challenge remains Safehold’s ability to consistently originate new ground leases in an unpredictable macro environment.

Explore 3 other fair value estimates on Safehold - why the stock might be worth as much as 42% more than the current price!

Build Your Own Safehold Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Safehold research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Safehold research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Safehold's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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