DBRS Assigns Rating of BBB (high) with Stable Trend to H&R REIT’s $200 Million Series N Senior Unsecured Debentures

DBRS Limited (DBRS) has today assigned a rating of BBB (high) with a Stable trend to the $200 million 3.369% Series N Senior Unsecured Debentures (the Series N Bonds) issued by H&R Real Estate Investment Trust (H&R REIT or the Trust), due January 30, 2024.

The Series N Bonds will be direct senior unsecured obligations of H&R REIT and will rank equally and rateably with all other present and future unsecured and unsubordinated indebtedness of the Trust.

DBRS understands that the net proceeds from the offering will be used for the repayment of outstanding indebtedness, thereby enabling the Trust to have greater financial capacity to pursue future acquisitions and developments and otherwise for general trust purposes. In particular, it is anticipated that the net proceeds from this offering, together with the net proceeds from the private placement of the Series M senior unsecured debentures as well as the net proceeds from the sale of a 50% non-managing interest in two enclosed shopping centres in Kingston, Ontario and Chicoutimi, Quebec for $211.6 million, have been and will be utilized by the H&R REIT to (1) repay two series of outstanding debentures having an aggregate principal amount of approximately $175.0 million maturing between January 23, 2017 and February 3, 2017, and (2) repay outstanding mortgages having an aggregate principal amount of approximately $307.0 million maturing between February 1, 2017 and March 1, 2017. Additional indebtedness had been incurred through prior acquisition and development activities and general trust activities of the Trust.

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

The applicable methodology is Rating Entities in the Real Estate Industry (June 2016), which can be found on our website under Methodologies.