DBRS Morningstar Confirms Ratings on Mortgage Loans Made to Paramount Apartments Limited

DBRS Limited (DBRS Morningstar) confirmed the ratings on the following mortgage loans made to Paramount Apartments Limited by a major Canadian financial institution:

-- 3.510% Mortgage Loan due February 1, 2025 at BBB (low)
-- 3.530% Mortgage Loan due February 1, 2025 at BBB (low)

All trends are Stable.

The rating confirmations reflect the overall stable performance of the transaction, which remains in line with DBRS Morningstar’s expectations. The mortgage loans are secured by Paramount Apartments, a 174-unit apartment complex with ground-level commercial space in downtown Halifax. As of March 2022, the property was 99.4% occupied, which is an improvement from the January 2021 occupancy rate of 86.2% and generally in line with pre-pandemic levels. According to the Canada Mortgage and Housing Corporation’s October 2021 market data, the Halifax Peninsula South submarket vacancy rate was 0.9%, compared to the October 2020 vacancy rate of 3.7%. The reported YE2021 net operating income (NOI) reflected a 9.3% increase from the YE2020 figure and was 7.2% above the DBRS Morningstar NOI.

ESG CONSIDERATIONS
A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://www.dbrsmorningstar.com/research/373262.

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

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

The principal methodology is North American CMBS Surveillance Methodology (March 4, 2022), which can be found on dbrsmorningstar.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 Morningstar Global Structured Finance Related Methodologies document, which can be found on dbrsmorningstar.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.

The DBRS Morningstar Sovereign group releases baseline macroeconomic scenarios for rated sovereigns. DBRS Morningstar analysis considered impacts consistent with the baseline scenarios as set forth in the following report: https://www.dbrsmorningstar.com/research/384482.

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 under Related Documents or by contacting us at info@dbrsmorningstar.com.

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 Morningstar 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.dbrsmorningstar.com or contact us at info@dbrsmorningstar.com.

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