DBRS Upgrades the Rating of One Class and Confirms Two Others of N-45 First CMBS Issuer Corporation, Series 2001-1

DBRS has today upgraded the rating of Class E to AA (high) (sf) from AA (sf), of N-45 First CMBS Issuer Corporation, Series 2001-1.

DBRS has also confirmed the ratings of two Classes as follows:

-Class D at AAA (sf)
-Class IO at AAA (sf)

Since issuance, the transaction has experienced a collateral reduction of approximately 95%, and the weighted-average debt service coverage ratio, as of the September 2011 cut-off, was 2.65x.

Since the last DBRS review of this transaction in October 2010, the Queens Quay Terminal loan reached its maturity date and paid in full. The upgrade reflects the increased credit enhancement as a result of the loan maturity, in addition to the continued amortization of the remaining two loans in the transaction.

As of the September 2011 remittance report, there are two loans remaining in the transaction. Both loans continue to perform well and mature in January 2013, with a positive refinance outlook, based on the weighted-average debt yield of 52.1%, as of the YE2010 net cash flow (NCF).

The largest loan in the pool is, Les Galeries de Terrebonne (56% of the current pool balance) and is secured by a 336,000 sf anchored retail centre in Terrebonne, Québec, which is approximately 31 kilometres north of Montréal. The property was 97.2% occupied as of the June 2011 rent roll, with staggered tenant rollover. The loan benefits from the long term lease of the anchor tenant, Provigo, who represents 16% of the NRA and has a lease expiration date in June 2017, four years beyond the maturity of the loan. The loan matures in January 2013 and should be a solid candidate for refinance based on the 52% debt yield, as of the YE2010 NCF.

DBRS continues to monitor this transaction on a monthly basis, with ongoing information being available in Monthly CMBS Surveillance Report.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The applicable methodologies are CMBS Rating Methodology and CMBS North American Surveillance Methodology, which can be found on our website under Methodologies.