Morguard Corporation: Rating Report

On November 22, 2019, DBRS Limited (DBRS Morningstar) confirmed the Senior Unsecured Debentures rating of Morguard Corporation (Morguard or the Company) at BBB (low) with a Stable trend. Because DBRS Morningstar assesses Morguard’s credit risk profile on a non-consolidated basis and attributes material rating benefit to Morguard’s holdings in Morguard Real Estate Investment Trust (REIT; MRT) and Morguard North American Residential REIT (MRG; together with MRT, the REITs), DBRS Morningstar’s EBITDA calculations exclude REIT distributions received. DBRS Morningstar believes that ownership in the REITs, forming core long-term investment holdings of Morguard, provides the Company with reliable quarterly cash distributions that it can use for debt service. This enhances diversification and stability of Morguard’s cash flows and is a positive consideration in Morguard’s credit risk profile, thus warranting some rating uplift.