Standard & Poor’s Ratings Services has lowered its outlook on New York-based Vornado Realty Trust, the firm behind the stalled Filene’s project in Boston’s Downtown Crossing.

Citing the company’s dubious ability to cover costs amid a weakening commercial real estate market, the outlook was lowered from "stable" to "negative."

The "BBB+" rating, which is an investment-grade rating three notches above junk, was affirmed for Vornado and its subsidiary, Vornado Realty LP.

In a note to investors, analyst James Fielding wrote the real estate investment trust’s coverage measures are weak in part because of low-yield cash holdings. Sizable investments in joint ventures are another concern, Fielding said.

This comes as one of Vornado’s developments, Bryant Back Bay, hits the auction block. Ten units in the deluxe Back Bay complex will be auctioned on Oct. 17, with minimum bids topping $1 million, according to a statement.

Still, Vornado’s investment-grade rating was affirmed because the company has ”one of the highest cash balances among related real estate investment trusts,” Fielding wrote.

He also noted that Vornado’s portfolio of offices and retail properties will provide stable cash flow relative to its peers.

Shares of Vornado slipped $1.37, or 2 percent, to close at $66.79.

Fielding wrote that Vornado’s rating would be lowered if it becomes less likely that the company can improve coverage measures through a reduction in debt, and investment activity. The outlook would be raised back to stable if it appears such activities will reduce fixed charges and increase funds from operations. (AP)