DBRS Morningstar Confirms Acces Recherche Montreal L.P. at 'A' With a Stable Trend.
ENPNewswire-October 8, 2021--DBRS Morningstar Confirms Acces Recherche Montreal L.P. at 'A' With a Stable Trend
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Release date- 07102021 - DBRS Limited (DBRS Morningstar) confirmed the Issuer Rating and Senior Secured Debt rating of Acces Recherche Montreal L.P. (ProjectCo) at 'A' with Stable trends.
ProjectCo is the special-purpose vehicle (SPV) created by Axium Recherche L.P. and Meridiam Infrastructure (SCA) SICAR to design, build, finance, and maintain a new 68,431-square metre research centre (the Project) under a 33.3-year public-private partnership with Centre hospitalier de l'Universite de Montreal (CHUM or the Hospital), one of the Province of Quebec's (the Province; rated AA (low) with a Stable trend by DBRS Morningstar) largest healthcare institutions.
The Project has been in operation for more than eight years and has performed relatively well. Despite a sharp uptick of failure points and deductions for the rolling 12 months ended August 31, 2021, compared with the same period last year, most of the failure points incurred were related to two elevator events that required an extended shutdown for several days in early 2021. DBRS Morningstar understands that the elevators were repaired by replacing the pulley and the issue has not recurred. Furthermore, the incurrence of failure points remain well below the contractual thresholds. The Lenders' Technical Advisor (LTA) noted in its most recent biannual operational report dated June 2021 that it does not consider the performance of the elevators a substantial risk for the project. To prevent the issue from reoccurring in the future, Honeywell Limited (Honeywell; a subsidiary of Honeywell International Inc. (rated 'A' with a Stable trend by DBRS Morningstar)) is currently co-ordinating with the elevator maintenance provider and the manufacturer to proactively repair the other elevators. The LTA also noted that the Project has generally reached a steady state of operation, and the failure points and deductions to date have been relatively minor. Furthermore, the facility remains in good condition, and Honeywell appears to be completing most of the lifecycle activities in accordance with the lifecycle schedule. There were, however, some unexpected lifecycle works related to construction defects, such as the vibration issue with the exhaust fans and the corrosion issue with the plumbing pipes, that had to be completed earlier than...
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