Fitch Affirms JPMBB 2014-C24
KEY RATING DRIVERS
The affirmations are due to the overall stable performance of the pool's underlying collateral. The pool continues to perform as expected at issuance. The pool's aggregate principal balance has been reduced by 0.70% to $1.267 billion from $1.276 billion at issuance. There are no specially serviced loans, and Fitch has not designated any loans as Fitch Loans of Concern. There are two loans (0.73% of the current balance) on the master servicer's watchlist due to deferred maintenance. The transaction remains concentrated, as the top 10 loans represent 60.2% of the pool, and the top 20 represent 80.2%.
The largest loan in the pool, the Mall of Victor Valley (9.1%), is secured by a 574,723 square foot (477,384 sf of collateral) regional mall located in Victorville, CA. The property was originally built in 1986 and renovated in 2013. The largest tenants include JCPenney, which represents 19.2% of net rentable area (NRA) with a lease expiring in September 2032, Sears (16.4% of NRA, expiry October 2019), and Cinemark Theatre (13% of NRA, expiry November 2021). The property has maintained high levels of occupancy and stable performance throughout its operating history. As of the June 2016 rent roll, the property was 98% occupied. The servicer-reported net operating income (NOI) debt service coverage ratio (DSCR) of 2.57x as of year-end (YE) 2015.
The next largest loan in the pool, the Grapevine Mills (9.1%), is secured by a 1.625 million sf (1.337 million sf of collateral) regional mall located in Grapevine, TX. The subject is located 10 miles north of the Dallas/Fort Worth International Airport and contains a mix of traditional mall tenants as well as outlet tenants. The tenants include Burlington Coat Factory (7.5% of NRA, expiry January 2018), Neiman Marcus (3.3% of NRA, expiry April 2018, and Bed Bath & Beyond (3% of NRA, expiry January 2017). As of the March 2016 rent roll, total mall occupancy was at 94%, with in-line occupancy of 89%. The servicer-reported NOI DSCR was 3.25x as of YE 2015. The transaction interests represent the A-3 and A-4 notes and are pari passu with A-1 and A-2 notes securitized in JPMBB 2014-C23 and A-5 and A-6 notes in JPMBB 2014-C25.
The third largest loan in the pool, the Columbus Square Portfolio (7.6%), is secured by a portfolio of five retail/community facility units and an underground parking garage, totaling 494,244 sf. The collateral is located between 97th and 100th streets on Columbus and Amsterdam avenues in the Upper West Side neighborhood of Manhattan. The largest tenants include Quik Park (16.9% of NRA, expiry May 2029), Whole Foods Market (12.6% of NRA, expiry September 2029), and Mandell School (8.9% of NRA, expiry March 2030). Occupancy has dropped slightly at the property year-over-year to 96% as of YE 2015 from 100% as of YE 2014. As a result, NOI DSCR was reduced to 1.37x YE 2015 from 1.51x YE 2014. The transaction interests represents the A-4 note and are pari passu with the A-1 note included in WFRBS 2014-C22, the A-2 note included in JPMBB 2014-C23, and the A-3 note securitized in WFRBS 2014-C23.
RATING SENSITIVITIES
The Rating Outlooks for all classes remain Stable. Due to the recent issuance of the transaction and stable performance, Fitch does not foresee positive or negative ratings migration until a material economic or asset level event changes the transaction's overall portfolio-level metrics.
USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G-10
No third-party due diligence was provided or reviewed in relation to this rating action.
Fitch has affirmed the following ratings:
--$27 million notes A-1 at 'AAAsf'; Outlook Stable;
--$184 million notes A-2 at 'AAAsf'; Outlook Stable;
--$41 million notes A-3 at 'AAAsf'; Outlook Stable;
--$190 million notes A-4A1 at 'AAAsf'; Outlook Stable;
--$75 million notes A-4A2 at 'AAAsf'; Outlook Stable;
--$297.3 million notes A-5 at 'AAAsf'; Outlook Stable;
--$66.6 million notes A-SB at 'AAAsf'; Outlook Stable;
--$76.2 million notes A-S at 'AAAsf'; Outlook Stable;
--$76.2 million notes B at 'AA-sf'; Outlook Stable;
--$47.7 million notes C at 'A-sf'; Outlook Stable;
--$200.2 million notes EC at 'A-sf'; Outlook Stable;
--$81 million notes D at 'BBB-sf'; Outlook Stable;
--$25.4 million notes E at 'BBsf'; Outlook Stable;
--$14.3 million notes F at 'Bsf'; Outlook Stable;
--$957.3 million* notes X-A at 'AAAsf'; Outlook Stable;
--$76.2 million* notes X-B1 at 'AA-sf'; Outlook Stable;
--$81 million* notes X-B2 at 'BBB-sf'; Outlook Stable;
--$25.4 million* notes X-C at 'BBsf'; Outlook Stable;
--$14.3 million* notes X-D at 'Bsf'; Outlook Stable.
Class A-S, B, and C certificates may be exchanged for class EC certificates and class EC certificates may be exchanged for class A-S, B, and C certificates. Fitch does not rate the X-E, NR, and ESK certificates.
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