According to a Brookfield Properties spokesperson, attractive U.S. treasury rates and the lease with a credit tenant contributed to the decision to refinance its initial $300 million short-term floating-rate construction loan through the securitization market.

The securitization consists of an A-1 tranche of $400 million issued at a fixed rate based upon 30-year Treasuries, and an additional floating-rate A-2 tranche of approximately $160 million in a Commercial Paper conduit facility, which will amortize over 10 years. The $560 million is expected to cover construction, set to be completed in August 2003.

"Thirty-year mortgages are admittedly rare for a commercial mortgage, but the reason we are able to do this is because we have the 30-year lease with CIBC," the spokesperson tells GlobeSt.com. The A-1 issuance has been rated Aa3 by Moody's and AA- by S&P, based on the credit rating of CIBC.