DBRS Places OMERS Realty Corporation (Centennial Place) Under Review with Developing Implications

DBRS Limited (DBRS) has today placed the ratings of the $210 million Centennial Place 3.666% Senior Series A Secured Bonds due 2022 and the $210 million Centennial Place 3.04% Senior Series B Secured Bonds due 2017 (collectively, the Bonds) of OMERS Realty Corporation (the Issuer or ORC; rated AA (low) with a Stable trend by DBRS), secured by Centennial Place (the Complex), Under Review with Developing Implications.

This rating action follows the announcement that ORC has sold 50% of its beneficial ownership interest in the Complex (the Transaction) to Canada Pension Plan Investment Board Real Estate Holdings Inc. (CPPIB). ORC retains 50% legal and beneficial interest in the Complex, CPPIB holds an undivided 50% beneficial interest in the Complex and 9856889 Canada Inc. (985) holds an undivided 50% legal interest in the Complex (as nominee and bare trustee) for and on behalf of CPPIB.

As a result of the Transaction, CPPIB and 985 (collectively, the New Co-Issuers) become co-issuers with ORC. The New Co-Issuers and ORC will each be liable for 50% of the obligations under the Bonds and the underlying security registered against the Complex. The Transaction closed on September 1, 2016.

DBRS will review executed documents in connection with the Transaction, including a co-owners agreement, supplemental indenture and legal opinions issued with respect to the Issuer and new co-owners.

DBRS aims to resolve the Under Review with Developing Implications status, which will likely occur within the next several weeks.

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

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link to the right under Related Research or by contacting us at info@dbrs.com.

The applicable methodologies are Rating Entities in the Real Estate Industry (June 2016) and DBRS Criteria: Guarantees and Other Forms of Support (February 2016), which can be found on our website under Methodologies.