QUÉBEC, Aug. 4, 2017 /CNW Telbec/
- Cominar Real Estate Investment Trust ("Cominar" or
the "REIT") (TSX: CUF.UN) announces credit rating
determination made earlier today by DBRS Limited ("DBRS") and
updates its unsecured debenture refinancing plan.
Credit Rating
Earlier today, DBRS announced that it had downgraded the rating
of the REIT's senior unsecured debentures to BB (high) with a
stable trend from BBB (low) with a negative trend.
"Our unencumbered property portfolio stands at $3.6 billion, which represents an
unencumbered assets to unsecured debt ratio of 1.52:1, keeping with
our commitment of 1.3:1 and giving us all the flexibility required
to replace our unsecured debentures, as they mature over the next
six years", said Mr. Michel
Dallaire, Chief Executive Officer of Cominar.
"We have $1.7 billion in
unsecured debentures outstanding bearing interest at an average
rate of 4.29%, approximately 100 basis points higher than the
current 5-year mortgage rate with important interest savings
potential in the future", added Mr. Dallaire.
Unsecured Debenture Refinancing Plan
The downward changes to our credit rating will have a negative
impact on our ability to finance in the unsecured debt marketplace,
with no impact on the performance of our portfolio and our
operations. The terms and conditions of the outstanding debentures
remain unaffected by the rating change.
With more than $3.6 billion of
unencumbered properties, the REIT plans to refinance its
outstanding unsecured debentures with secured debt in the form of
mortgages over the next 6 years as the REIT's unsecured debentures
mature.
The REIT has no unsecured debenture maturities prior to
June 2019.
This refinancing plan will enable the REIT to generate important
interest savings as mortgage rates are more favourable to the REIT
when compared to the REIT's cost for unsecured debentures. The
refinancing plan will not affect the REIT's long-term debt
ratio.
The following table provides summary information on the REIT's
outstanding unsecured debentures:
|
Par value as
at
June 30, 2017
|
Maturity
date
|
Effective
Interest Rate
|
|
$
|
|
%
|
|
|
|
|
Series 2
|
300,000
|
December
2019
|
4.37
|
Series 3
|
100,000
|
November
2020
|
4.24
|
Series 4
|
300,000
|
July 2020
|
4.81
|
Series 7
|
300,000
|
June 2019
|
3.70
|
Series 8
|
200,000
|
December
2021
|
4.34
|
Series 9
|
300,000
|
June 2022
|
4.25
|
Series 10
|
225,000
|
May 2023
|
4.34
|
Total
|
1,725,000
|
|
4.29
|
PROFILE AS AT AUGUST 4,
2017
Cominar is the third largest diversified real
estate investment trust in Canada
and currently remains the largest commercial property owner in the
Province of Quebec. The REIT owns
a real estate portfolio of 525 properties in three different market
segments, that is, office properties, retail properties and
industrial and mixed-use properties. Cominar's portfolio totals
44.1 million square feet spread out across Quebec, Ontario, the Atlantic Provinces and
Western Canada. Cominar's
objectives are to pay growing cash distributions to unitholders and
to maximize unitholder value through proactive management and the
expansion of its portfolio.
FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements with
respect to Cominar and its operations, strategy, financial
performance and financial condition. These statements generally can
be identified by the use of forward-looking words such as "may",
"will", "expect", "estimate", "anticipate", "intend", "believe" or
"continue" or the negative thereof or similar variations. The
actual results and performance of Cominar discussed herein could
differ materially from those expressed or implied by such
statements. Such statements are qualified in their entirety by the
inherent risks and uncertainties surrounding future expectations.
Some important factors that could cause actual results to differ
materially from expectations include, among other things, general
economic and market factors, competition, changes in government
regulation and the factors described under "Risk Factors" in
Cominar's Annual Information Form. The cautionary statements
qualify all forward-looking statements attributable to Cominar and
persons acting on its behalf. Unless otherwise stated, all
forward-looking statements speak only as of the date of this press
release. Cominar does not assume any obligation to update the
aforementioned forward-looking statements, except as required by
applicable laws.
SOURCE COMINAR REAL ESTATE INVESTMENT TRUST