Fitch Ratings has issued a presale report on BBCCRE Trust
2015-GTP commercial mortgage pass-through certificates, series
2015-GTP.
Fitch expects to rate the transaction and assign Rating Outlooks
as follows:
--$330,000,000a class A notes 'AAAsf'; Outlook Stable;
--$330,000,000ab class X-A notes 'AAAsf'; Outlook Stable;
--$103,000,000ab class X-B notes 'A-sf'; Outlook Stable;
--$62,000,000a class B notes 'AA-sf'; Outlook Stable;
--$41,000,000a class C notes 'A-sf'; Outlook Stable.
The following classes are not expected to be rated:
--$98,500,000a class D;
--$91,400,000a class E;
--$37,100,000a class F.
a Privately placed pursuant to Rule 144A.
b Notional amount and interest-only.
The expected ratings are based on information provided by the
issuer as of July 14, 2015.
The certificates represent the beneficial ownership in the
trust, the primary asset of which is one loan having an aggregate
principal balance of $660 million as of the cut-off date. The trust
is primarily secured by the first priority mortgages on each
borrower's fee simple and leasehold interests in 39 office and 2
industrial properties totalling 2.6 million square feet (sf). The
portfolio properties are 100% occupied by 16 U.S. Federal
Government (USFG; ('AAA'/Stable Outlook) agencies via General
Services Administration (GSA) leases.
The loan is sponsored by NGP V Fund, one of the nation's largest
real estate investment programs focused on the acquisition and
management of assets leased to U.S. governmental entities. The loan
was jointly originated by Cantor Commercial Real Estate Lending, LP
and Barclays Bank plc.
KEY RATING DRIVERS
High Fitch Leverage: The $660 million mortgage loan has a Fitch
debt service coverage ratio (DSCR) and loan-to-value (LTV) of 0.92x
and 96.8%, respectively, and debt of $256 psf. The sponsor has a
reported cost basis in the portfolio of $846.8 million,
representing a loan-to-cost ratio of 77.9%. No additional future
debt is permitted.
Rollover: The portfolio has significant initial (hard) lease
term rollover of 95.4% (by sf) prior to the loan maturity in 2025.
The rollover is staggered throughout the loan term, with no more
than 22.9% of total rent across nine leases expiring in any year
(2023). Each of the properties was either built-to-suit or
retrofit-to-suit specifically to agency and GSA requirements.
Because of the mission critical nature of many government
facilities, locational restrictions, and various procurement
factors, renewal probability in the government sector has
historically been high.
Tenant Credit Quality: The portfolio is 100% occupied by 16 USFG
agencies via GSA leases. The leases are not subject to annual
appropriations. Three agency tenants, the FBI (22.5%), CIS (18%)
and DEA (11.7%) represent over 7.7% of total portfolio rent.
Asset Quality: The weighted average year of construction for the
portfolio is 2007, and to date, the GSA/tenant's total investment
in improvements across the portfolio is $157.7 million ($61 psf).
Fitch assigned property quality grades of 'B+' or better to 16
properties (81% of the pool balance for Fitch sampled loans).
RATING SENSITIVITIES
Fitch found that the property could withstand a 67.6% decline in
value and an approximate 59.4% decline in Fitch's net cash flow
prior to experiencing $1 of loss to the 'AAAsf' rated class A.
Fitch performed several stress scenarios in which the Fitch net
cash flow (NCF) was stressed. Fitch determined that a 44.5%
reduction in Fitch's NCF would cause the notes to break even at a
1x DSCR, based on the actual debt service.
Fitch evaluated the sensitivity of the ratings for class A and
found that a 7% decline in Fitch NCF would result in a one-category
downgrade, while a 34% decline would result in a downgrade to below
investment grade.
The Rating Sensitivity section in the presale report includes a
detailed explanation of additional stresses and sensitivities. Key
Rating Drivers and Rating Sensitivities are further described in
the accompanying presale report. The presale report is available to
all investors on Fitch's web site 'www.fitchratings.com'.
DUE DILIGENCE USAGE
Fitch was provided with third-party due diligence information
from KPMG LLP. The third-party due diligence information was
provided on Form ABS Due Diligence Form-15E and focused on a
comparison and re-computation of certain characteristics with
respect to the mortgage loan and related mortgaged properties in
the data file. Fitch considered this information in its analysis
and the findings did not have an impact on our analysis.
Additional information is available at www.fitchratings.com.
BBCCRE Trust 2015-GTP
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=869167
Applicable Criteria
Counterparty Criteria for Structured Finance and Covered Bonds
(pub. 14 May 2014)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158
Criteria for Analyzing Large Loans in U.S. Commercial Mortgage
Transactions (pub. 20 Mar 2015)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=862818
Global Structured Finance Rating Criteria (pub. 06 Jul 2015)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952
Rating Criteria for U.S. Commercial Mortgage Servicers (pub. 14
Feb 2014)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=735382
Additional Disclosures
Dodd-Frank Rating Information Disclosure Form
https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=988718
ABS Due Diligence Form 15E 1
https://www.fitchratings.com/creditdesk/press_releases/content/ridf15E_frame.cfm?pr_id=988718&flm_nm=15e_988718_1.pdf
Solicitation Status
https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=988718
Endorsement Policy
https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31
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DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY
FOLLOWING THIS LINK:
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RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE
AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'.
PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM
THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY,
CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER
RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE
OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER
PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD
PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD
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ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.
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version on businesswire.com: http://www.businesswire.com/news/home/20150729006835/en/
Fitch RatingsPrimary AnalystRyan Frank, +1-312-368-3133Senior
DirectorFitch Ratings, Inc.70 West Madison StreetChicago, IL
60602orSecondary and Surveillance AnalystBritt Johnson,
+1-312-606-2341Senior DirectororCommittee ChairpersonRobert
Vrchota, +1-312-368-3336Managing DirectororMedia RelationsMatthew
Robinson, +61 2 8256 0326matthew.robinson@fitchratings.com