Fitch Affirms FREMF 2013-K27 & Freddie Mac SPCs, Series K027
KEY RATING DRIVERS
The affirmations are based on the stable performance of the underlying collateral pool. As of the April 2015 distribution date, the pool has had no delinquent or specially serviced loans. The pool's aggregate principal balance has been paid down by 0.71% to \$1.63 billion from \$1.64 billion at issuance.
The largest loan of the pool (12.3% of the pool) is secured by Alta at K Station, an 848-unit, two-tower high rise complex located in Chicago, IL. The towers, one 37 stories and the other 41 stories, were built in 2010. The property is LEED Gold Certified and features amenities including an outdoor pool and spa, fire pit and grilling area, sundeck with cabanas, fitness center, business center, a 22-seat theater, basketball/volleyball court, men's and women's saunas and a party suite with full kitchen. Occupancy was 97% as of September 2014, which is slight improvement from 92.7% at issuance.
The second largest loan (4.3% of the pool) is secured by Rollin Street Flats, a 208-unit high-rise apartment complex located in Seattle, WA approximately one mile north of the Seattle CBD. The property was developed by the borrower in 2009 for \$111.8 million (\$537,464/unit). Occupancy was 96% as of September 2014, which is in-line with 93.8% at issuance.
The third largest loan (3.8% of the pool) is secured by a 660-unit garden style apartment community located in Parker, CO approximately 24 miles southeast of the Denver CBD. The subject consists of two adjacent apartment communities that are operated as one property. The borrower purchased the subject in 2012 for \$82.75 million (\$125,379 per unit). Occupancy increased to 98% as of September 2014 compared to 93.6% at issuance.
RATING SENSITIVITY
Rating Outlooks on all Fitch rated 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. Additional information on rating sensitivity is available in the 'FREMF 2012-K27 Multifamily Mortgage Pass-Through Certificates and Freddie Mac Structured Pass-Through Certificates, Series K-027' (May 6, 2013) presale report, available at 'www.fitchratings.com'.
Fitch affirms the following classes:
FREMF 2013-K27 Multifamily Mortgage Pass-Through Certificates
--\$221.46 million class A-1 at 'AAAsf'; Outlook Stable;
--\$1.15 billion class A-2 at 'AAAsf'; Outlook Stable;
--\$1.38 billion* class X1 at 'AAAsf'; Outlook Stable;
--\$1.38 billion* class X2-A at 'AAAsf'; Outlook Stable;
--\$88.1 million class B at 'A-sf'; Outlook Stable;
--\$40.97 million class C at 'BBBsf'; Outlook Stable.
Freddie Mac Structured Pass-Through Certificates, Series K-027
--\$221.46 million class A-1 at 'AAAsf'; Outlook Stable;
--\$1.15 billion class A-2 at 'AAAsf'; Outlook Stable;
--\$1.38 billion* class X1 at 'AAAsf'; Outlook Stable.
*Notional amount and interest only.
Of FREMF 2013-K27, Fitch does not rate the \$193 million interest-only class X2-B, the \$252 million interest-only class X3, or the \$122.9 million class D. Of the Freddie Mac Structured Pass-Through Certificates, Series K-027, Fitch does not rate the \$252 million interest-only class X3.
A comparison of the transaction's Representations, Warranties, and Enforcement (RW&E) mechanisms to those of typical RW&Es for the asset class is available in the following report:
--'FREMF 2013-K27 Multifamily Mortgage Pass-Through Certificates and Freddie Mac Structured Pass-Through Certificates, Series K-027 -- Appendix' (May 6, 2013).
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