DBRS Morningstar Confirms Rating on Mortgage Loan Made to South Block (Concert) Ltd. and Jawl Precinct Lands Corporation – 525 Superior Street

DBRS Limited (DBRS Morningstar) confirmed the rating on the following mortgage loan made to South Block (Concert) Ltd. and Jawl Precinct Lands Corporation – 525 Superior Street (collectively, the Borrowers) by a major Canadian financial institution:

-- Mortgage Loan No. 814650.1 at AA (high)

The trend is Stable.

The rating confirmation reflects the overall stable performance of the transaction, which remains in line with DBRS Morningstar’s expectations.

The loan is secured by a 2017 vintage office building at 525 Superior Street in Victoria. DBRS Morningstar’s current rating of the mortgage loan reflects the rating of the credit tenant, the Government of the Province of British Columbia (the Tenant; rated AA (high) with a Stable trend by DBRS Morningstar), which occupies 99% of the total net rentable area and has a lease that is co-terminous with the fully amortizing loan term with no rights to early termination. The net cash flow from the Tenant’s lease is sufficient to cover the financial obligations of the Borrowers related to the mortgage loan. Any change to the DBRS Morningstar rating of the Tenant during the loan term is likely to have an effect on the rating of the mortgage loan.

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance factors that had a significant or relevant effect on the credit analysis.

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 https://www.dbrsmorningstar.com/research/396929 (May 17, 2022).

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 16, 2023; https://www.dbrsmorningstar.com/research/410912).

Other methodologies referenced in this transaction are listed at the end of this press release.

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.

The rating was not initiated at the request of the rated entity. The rating was initiated at the request of a third party.

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, management, and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

This is a solicited credit rating.

DBRS Limited
DBRS Tower, 181 University Avenue, Suite 700
Toronto, ON M5H 3M7 Canada
Tel. +1 416 593-5577

The rating methodologies used in the analysis of this transaction can be found at: https://www.dbrsmorningstar.com/about/methodologies.

North American Single-Asset/Single-Borrower Ratings Methodology (February 23, 2023; https://www.dbrsmorningstar.com/research/410191)

DBRS Morningstar North American Commercial Real Estate Property Analysis Criteria (September 12, 2022; https://www.dbrsmorningstar.com/research/402646)

North American Commercial Mortgage Servicer Rankings (September 8, 2022; https://www.dbrsmorningstar.com/research/402499)

Legal Criteria for Canadian Structured Finance (June 22, 2022; https://www.dbrsmorningstar.com/research/398729)

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