DBRS Assigns Stable Trend to and Confirms Rating of Mortgage Loan Made to LaSalle Canada Core Real Property, L.P., Minto (Kent St) Inc. and I.G. Investment Management Ltd (Minto Place IV)

DBRS Limited (DBRS) assigned a Stable trend to and confirmed the rating of BBB (low) on the 4.218% Mortgage Loan due December 1, 2021 (the Mortgage Loan) made to LaSalle Canada Core Real Property, L.P. (Lasalle), Minto (Kent St) Inc. and I.G. Investment Management Ltd by a major Canadian financial institution (the Lender). Effective April 1, 2019, DBRS changed the issuer name to LaSalle Canada Core Real Property, L.P., Minto (Kent St) Inc. and I.G. Investment Management Ltd (Minto Place IV) from Minto (Kent St.) Inc. and I.G. Investment Management Ltd. (Minto Place IV).

The Mortgage Loan is secured by a Class A office tower located at 180 Kent Street in the City of Ottawa (the Property), which is part of the Minto Place Complex. DBRS’s current rating reflects the credit quality of the loan supported by the results of DBRS’s analytics, which indicate a DBRS Exit Debt Yield of 10.7% based on DBRS’s net cash flow, which was 24.5% lower than the 2017 reported net operating income. Based on DBRS’s cap rate of 7.75%, the Mortgage Loan represents current and maturity DBRS loan-to-value ratios of 81.7% and 72.6%, respectively.

DBRS notes that in August 2018, 33.33% of the ownership interest in the Property was transferred to LaSalle, which assumed the Mortgage Loan by the same percentage. DBRS considers LaSalle to be an experienced and capable real estate investor, and the partial Mortgage Loan assumption has no material impact on the credit rating of the debt.

All ratings are subject to surveillance, which could result in ratings being upgraded, downgraded, placed under review, confirmed or discontinued by DBRS.

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

The principal methodology is the North American CMBS Surveillance Methodology, which can be found on www.dbrs.com under Methodologies & Criteria. For a list of the structured-finance-related methodologies that may be used during the rating process, please see the DBRS Global Structured Finance Related Methodologies document, which can be found on www.dbrs.com in the Commentary tab under Regulatory Affairs. Please note that not every related methodology listed under a principal structured finance asset class methodology may be used to rate or monitor an individual structured finance or debt obligation.

This rating was initiated at the request of the Lender.

The rated entity or its related entities did not participate in the rating process for this rating action. DBRS had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

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

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