DBRS Upgrades 3 Classes of N-45° 2001-1, Confirms 3 Classes

Dominion Bond Rating Service (“DBRS”) has today upgraded the ratings of N-45° First CMBS Issuer Corporation’s Commercial Mortgage Backed Bonds, Series 2001-1. The classes have been upgraded as follows: Class C to AA (high) from AA, Class D to A (high) from “A”, and Class E to BBB from BBB (low). In addition, three classes were confirmed: Classes A, B, and IO at AAA. The subordinate Class F (Cdn$3.6 million) is not rated by DBRS. The trends for all rated classes are Stable.

The upgrades reflect stable financial performance of the four remaining collateral properties, and increased credit enhancement due to the repayment of Atrium on Bay, which was the second largest loan at issuance.

Seven of the original nine commercial mortgage loans remain in the transaction, totalling Cdn$112,544,279. The loans are collateralized by four properties. The Bell Trinity Square loan, which was the largest loan in the pool at issuance (41.1% of the issuance balance) pre-paid in August 2005, and Atrium on Bay which was the second largest loan in the pool at issuance (23.6% of the issuance balance) paid off in December 2005, significantly altering the concentration of the pool and the improving credit enhancement levels. The pool, which was originally 75.9% concentrated with office properties in Toronto, now has only 32.5% of the balance in Toronto office properties, and the remaining 67.5% of the balance in retail properties located in the province of Québec.

Financial performance of the remaining properties in the pool is strong. The weighted-average net operating income (NOI) debt service coverage ratio is 2.16 times (x), compared to 1.83x at issuance. Leverage on the remaining loans is low, with a current weighted-average loan-to-value of 46.0% (assumes the original appraisal value).