DBRS Removes Under Review Status and Confirms Scotia Plaza FMB Rating

DBRS Limited (DBRS) confirmed the rating of the $650 million 3.21% First Mortgage Bonds (the Bonds) of KS SP Limited Partnership and KS SP1 Limited Partnership, and ARI SP Limited Partnership and ARI SP1 Limited Partnership (each an Issuer and, collectively, the Issuers) secured by Scotia Plaza (the Complex) at A (high) (sf). This rating action removes the rating from Under Review with Developing Implications.

On September 19, 2017, DBRS placed the rating on the Bonds Under Review with Developing Implications following the announcement on September 8, 2017, that the agreements to sell Dream Office REIT’s 50% interest in Scotia Plaza (the Transaction) to its existing co-owners, KingSett Canadian Real Estate Income Fund LP (KingSett) and Alberta Investment Management Corporation (AIMCo) had closed on August 23, 2017. Following completion of the Transaction, Dream Office REIT (DREAM) no longer has an interest in the Complex.

The rating confirmation reflects DBRS’s receipt and review of all executed documents associated with the Transaction. The documents provide for the assumption by the KingSett and AIMCo entities of all payment obligations under the Bonds and contain an acknowledgement and grant of security interest over the properties in favour of the indenture trustee. Effectively, DREAM is replaced by the KingSett and AIMCo entities under the mortgage bonds.

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 principal methodology is North American Single-Asset/Single-Borrower Methodology, which can be found on dbrs.com under Methodologies.

The rated entity or its related entities did participate in the rating process. DBRS had access to the accounts and other relevant internal documents of the rated entity or its related entities.

For more information on this credit or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.