- What August statistics from Morningstar DBRS show that the delinquency rate among conduit loans was up slightly month over month
- Why Eight loans were paid off in the reporting period
- What next Three loans scheduled to mature in August remain outstanding
The rate of Canadian conduit CMBS loans in delinquency or special servicing inched up to 1.6% in August from 1.58% a month earlier, according to Morningstar DBRS.
The same rate in the U.S. is 6.53%. Canada’s total outstanding universe comprises 468 loans from 18 offerings totaling $3.79bn. By outstanding loan balance, Ontario represents 51% of the pool, followed by Québec at 17% and Alberta at 10%.
The delinquency rate stems from three loans in two offerings backed by properties in Alberta and Québec. Alberta’s 9.4% rate is tied to a loan on WSP Place, an office property in Edmonton, that was included in the REAL-T 2019-1 offering. That loan has a total current balance of $34.3m.
Morningstar noted that Alberta is the only province to ever see historical realized losses, of $8.7m. “In Alberta, the impact of the pandemic on the province’s reliance on the energy industry has been particularly pronounced,” the rating agency said.
Québec’s delinquency rate, at 4.3%, stems from a loan on the CALM mixed-use building from the CCMOT 2022-5 deal. That loan, with a total current balance of $16.3m, is more than 121 days delinquent. The servicer continues to pay advances for the loan, per Morningstar.
The WSP and CALM loans were in special servicing as of August, as was a loan on a retail property in Terrebonne, Qué.
Eight loans were paid off in the August reporting period. The largest was a mortgage with an initial balance of $19.3m on a Class-A office building at 100 Dundas Street in London, Ont. That debt was securitized in CCMOT 2022-5. Despite the property losing its largest tenant, Bell Canada, in March 2022 and occupancy dropping to 56%, the loan was paid off in full.
Eight loans were scheduled to mature in August. Four were paid off at maturity, one was paid off early, and three are outstanding. The latter are: a loan on Newmarket Plaza, a retail property in Newmarket, Ont., with a $7.2m current trust balance (REALT 2014-1); a $5m loan on Desjardins Office Jonquière Québec loan (REAL-T 2017); and a $2.9m loan on a Gencore Properties multifamily property in Moose Jaw, Sask. (REALT 2016-1).
