Goodman Group has had its credit rating cut by one notch, due to high gearing and a weak outlook for its business.

The downgrade would increase the non-residential property company group's interest bill by about $2m a year, Goodman said.

Moody's Investors Service yesterday lowered Goodman's long-term unsecured rating from Baa2 to Baa3, and warned the rating was on review for a possible further downgrade.

Moody's noted Goodman was taking steps to reduce gearing and improve its liquidity profile.

The Australian