OREANDA-NEWS. November 25, 2015. Fitch Ratings affirms Queens Center Mortgage Trust, commercial mortgage pass-through certificates, series 2013-QC. A full list of rating actions follows at the end of this rating action commentary.

KEY RATING DRIVERS
The affirmations are the result of continued strong property performance. The annualized June 30, 2015 servicer-reported net operating income (NOI) has improved 11% compared to issuance. Occupancy, in-line comparable stores sales and the related occupancy costs also remained strong at 94%, \\$1,097 per square foot (psf) and approximately 21.8%, respectively. Due to the exceptionally high tenant sales at this regional mall, Fitch applied a stressed capitalization rate lower than the typical range for retail properties, resulting in a Fitch stressed loan to value (LTV) of 64% an improvement over 75% at issuance.

The property is a four-story regional shopping mall located in Elmhurst, NY, in the heart of Queens. The property was originally built in 1974 and last renovated in 2004. The current square footage is 967,901, of which 411,177 sf is collateral for the loan. The two anchors, Macys and JC Penney, each own their own stores and are not part of the loan collateral. In addition to the anchor stores, there are approximately 150 tenants, including Forever 21, H&M, Modell's Sporting Goods, Banana Republic, Express, Gap, Urban Outfitters, and Victoria's Secret. The Apple Store opened in July 2015 and is the first of its kind to open in one of the NYC boroughs outside of Manhattan. As a result of the Apple Store opening, leasing activity at the property remains very active with increased foot traffic. Per the master servicer, the center continues to receive positive feedback from its customers on the many new stores that have opened over the last year and the common area is filled with income generating uses and growing every day.

Queens Center features a diverse tenant mix that generated total sales of approximately \\$520.6 million and exceptional in-line sales of \\$1,097 psf for the trailing 12-month (TTM) period ended May 31, 2015, which places the property as one of the top performing malls in the country. The mall is unique among other malls with sales in this range due to enormous customer traffic, estimated at 18 million visitors per year, and a lower average per purchase basis given the lack of luxury retailers, which are prevalent at many of the country's top performing malls.

The loan sponsor is an entity controlled by The Macerich Company (MAC) with a 51% ownership interest and Ontario Teachers' Pension Plan (OTPP), which has a 49% interest.

RATING SENSITIVITIES
The Outlook remains Stable for classes A and X-A. Rating Outlooks for classes X-B, C, and D have been revised to Positive due to continued strong property performance. Fitch will review the transaction again once year-end (YE) 2015 financials are received and if performance remains consistent upgrades to these classes are possible. Fitch does not foresee downgrades unless there is a material decline in property performance.

DUE DILIGENCE USAGE
No third-party due diligence was provided or reviewed in relation to this rating action.

Fitch has affirmed and revised outlooks as indicated:

--\\$400.2 million class A at 'AAAsf'; Outlook Stable;
--\\$400.2 million class X-A at 'AAAsf'; Outlook Stable;
--\\$77.2 million class X-B at 'AA-sf'; Outlook to Positive from Stable;
--\\$77.2 million class B at 'AA-sf'; Outlook to Positive from Stable;
--\\$52.8 million class C at 'A-sf'; Outlook to Positive from Stable;
--\\$69.8 million class D at 'BBB-sf'; Outlook to Positive from Stable.