OREANDA-NEWS. February 19, 2016. Fitch Ratings has affirmed six classes of FREMF 2013-K28 multifamily mortgage pass-through certificates and three classes of Freddie Mac structured pass-through certificates series K-028. A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

The affirmations of Freddie Mac 2013-K28 are based on the stable performance of the underlying collateral. As of the April 2014 distribution date, the pool's aggregate principal balance has been reduced by 1.89% to \\$1.86 billion from \\$1.9 billion at issuance. Fitch has not designated any loans as Fitch Loans of Concern, and no loans are in special servicing.

The affirmations of the Freddie Mac Series K-028 certificates are the result of the pass-through nature of the certificates, as they are dependent on the underlying ratings of corresponding classes of FREMF 2013-K28.

The largest loan of the pool (4.7%) is secured by Country Lights, a 1,072-unit garden-style apartment community located in Bensalem, PA, approximately 23 miles northeast of the Philadelphia CBD. The subject property contains 72 two-story apartment buildings that were constructed from 1971 through 1975, along with a clubhouse, swimming pool, tennis courts and tennis hut. Occupancy has declined from 92% at issuance to 83% as of June 2016.

The second largest loan (4.7%) is the Carmel Rincon Apartments, which is secured by a 320-unit high-rise apartment complex in San Francisco, CA in the South of Market (SOMA) district. The property contains two 17-story apartment buildings that were constructed in 1989 and includes amenities such as a furnished roof terrace, parking garage and concierge. The current borrower acquired the property via a non-judicial foreclosure in October 2010. The previous borrower filed a lawsuit claiming a number of wrongdoings, including wrongful foreclosure, seeking to nullify the foreclosure. In January 2013, the San Francisco Superior Court ruled in favor of the current borrower and the previous borrower has since filed an appeal, which is still pending. The current borrower is contractually required to indemnify any actual loss or damages that might be incurred by the trust. The servicer-reported occupancy decreased slightly to 92% as of September 2015 from 95% at issuance.

The seventh largest loan (2.6%) is secured by the Creekside Apartment Homes, a 397-unit garden-style apartment community in Simi Valley, CA. The property contains 35 two-story apartment buildings that were constructed in 1985 and includes amenities such as swimming pools, two spas, a fitness center, residents' lounge and a children's playground. The property's occupancy has declined to 73% as of the third-quarter 2015 from 91% as of April 2013. The decline is attributed to 80 units being converted from rent-controlled to market-rate apartments as of July 2013. As discussed in Fitch's presale report, the conversion had the potential to cause a 20% vacancy rate at the property. However, these units were renting at an average 62% discount to market rents based on the November 2012 rent roll. The owner has renovated half of the units in the project to date and is renting them at significantly higher rates than prior to vacancy. The property is performing well. The annualized September 2015 net operating income (NOI) reflects an 8% increase from Fitch's Cash Flow Analysis at issuance.

RATING SENSITIVITIES

The Rating Outlook for all classes remains 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 portfolio-level metrics.

DUE DILIGENCE USAGE

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

Fitch affirms the following classes:

FREMF 2013-K28 Multifamily Mortgage Pass-Through Certificates
--\\$235.8 million class A-1 at 'AAAsf'; Outlook Stable;
--\\$1.3 billion class A-2 at 'AAAsf'; Outlook Stable;
--\\$109.3 million class B at 'A-sf'; Outlook Stable;
--\\$47.5 million class C at 'BBBsf'; Outlook Stable.
--\\$1.6* billion class X1 at 'AAAsf'; Outlook Stable;
--\\$1.6* billion class X2-A at 'AAAsf'; Outlook Stable.

Fitch does not rate the class D, X2-B and X3 certificates.

Freddie Mac Structured Pass-Through Certificates, Series K-028
--\\$235.8 million class A-1 at 'AAAsf'; Outlook Stable;
--\\$1.3 billion class A-2 at 'AAAsf'; Outlook Stable;
--\\$1.6* billion class X1 at 'AAAsf'; Outlook Stable.

Fitch does not rate the class X3 certificates.

*Notional amount and interest-only.