The recovery rating on the Senior Unsecured Debentures is RR4. The Negative trends reflect Cominar’s deteriorating financial risk profile (i.e., debt/EBITDA leverage and EBITDA interest coverage) relative to DBRS Morningstar’s expectations as outlined in its press release dated
The Negative trends reflect DBRS Morningstar’s assessment that Cominar’s financial risk metrics have deteriorated relative to expectations over the last year. DBRS Morningstar now forecasts a debt-to-EBITDA ratio of 11.5 times (x) and 11.0x for 2021 and 2022, respectively, versus about 10.0x or below in 2021 and 2022 at the time of DBRS Morningstar’s last press release on
DBRS Morningstar notes that Cominar maintains a strong market presence in
Despite the reduction in EBITDA, Cominar’s strong ability to attract a broad range of tenants for its office, retail, and industrial segments continues to support its earnings profile. The Trust demonstrates its bargaining power in
DBRS Morningstar will likely consider a rating downgrade within the next 12 months if (1) Cominar’s total debt-to-EBITDA ratio remains above 10.0x or its EBITDA interest coverage ratio remains below 2.25x, on a sustained basis, all else equal; (2) DBRS Morningstar foresees elevated liquidity or refinancing risks; or (3) the result of the strategic review negatively affects the Trust’s credit quality. DBRS Morningstar may change the trend on the ratings to Stable if Cominar successfully generates sufficient liquidity to maintain balance sheet flexibility and retire near-term obligations, in particular the
A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework and its methodologies can be found at: https://www.dbrsmorningstar.com/research/357792.
All figures are in Canadian dollars unless otherwise noted.
The principal methodologies are Rating Entities in the Real Estate Industry (
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The rated entity or its related entities did 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.
Generally, the conditions that lead to the assignment of a Negative or Positive trend are resolved within a 12-month period. DBRS Morningstar trends and ratings are under regular surveillance.
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Date Issued Debt Rated Action Rating Trend Recovery Rating Attributes
US = Lead Analyst based in USA
CA = Lead Analyst based in
EU = Lead Analyst based in EU
E = EU endorsed
Unsolicited Participating With Access
Unsolicited Participating Without Access
29-Dec-20Issuer Rating Trend Change BB (high) Neg US
29-Dec-20Senior Unsecured Debentures Trend Change BB (high) Neg RR4 US
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