DBRS Finalizes Ratings on COMM 2014-CCRE18 Mortgage Trust

DBRS has today finalized the provisional ratings on the following classes of Commercial Mortgage Pass-Through Certificates, Series 2014-CCRE18 (the Certificates) issued by COMM 2014-CCRE18 Mortgage Trust. The trends are Stable.

-- Class A-1 at AAA (sf)
-- Class A-2 at AAA (sf)
-- Class A-SB at AAA (sf)
-- Class A-3 at AAA (sf)
-- Class A-4 at AAA (sf)
-- Class A-5 at AAA (sf)
-- Class X-A at AAA (sf)
-- Class X-B at AAA (sf)
-- Class X-C at AAA (sf)
-- Class A-M at AAA (sf)
-- Class B at AA (low) (sf)
-- Class PEZ at A (low) (sf)
-- Class C at A (low) (sf)
-- Class D at BBB (low) (sf)
-- Class E at BB (low) (sf)
-- Class F at B (low) (sf)

Classes X-A, X-B, D, E, F and G have been privately placed pursuant to Rule 144A. The Class X balances are notional. DBRS ratings on interest-only (IO) certificates address the likelihood of receiving interest based on the notional amount outstanding. DBRS considers the IO certificates’ position within the transaction payment waterfall when determining the appropriate rating.

Up to the full certificate balance of the Class A-M, Class B and Class C certificates may be exchanged for Class PEZ certificates. Class PEZ certificates may be exchanged for up to the full certificate balance of the Class A-M, Class B and Class C certificates.

The collateral consists of 49 fixed-rate loans secured by 60 commercial and multifamily properties. The transaction has a balance of $996,340,247. The pool exhibits a DBRS weighted-average term debt service coverage ratio (DSCR) and debt yield of 1.45 times (x) and 8.9%, respectively, based on the whole loan balances. The DBRS sample included 24 loans, representing 77.5% of the pool. Properties representing 36.8% of the pool are located in urban markets with increased liquidity, greater than transactions in the recent past that typically have urban concentrations of 15% to 20%.

The pool is concentrated by loan size, as the top ten loans represent 57.5% of the overall pool balance. The pool has a concentration level similar to a pool of 14 equal-sized loans. The combined partial IO and full-term IO concentration is 63.7%. There are three loans that are IO for the full term, representing 16.4% of the pool, including the largest loan in the pool. Overall, this results in a relatively low level of amortization during the loan term of -11.7%. Additionally, 19 loans, representing 48.7% of the pool, have a DBRS calculated Refi DSCR of less than 1.00x. However, these DSCRs are based on a weighted-average stressed refinance constant of 9.8%, which implies an interest rate of 9.1%, amortizing on a 30-year schedule. This represents a significant stress of nearly 4.4% over the weighted-average contractual interest rate of the loans in the pool.

The ratings assigned to the Certificates by DBRS are based exclusively on the credit provided by the transaction structure and underlying trust assets. All classes will be subject to ongoing surveillance, which could result in upgrades or downgrades by DBRS after the date of issuance.

Notes:
All figures are in U.S. dollars unless otherwise noted.

This rating is endorsed by DBRS Ratings Limited for use in the European Union.

The applicable methodology is CMBS Rating Methodology, which can be found on our website under Methodologies.

The Rule 17g-7 Report of Representations and Warranties is hereby incorporated by reference and can be found by clicking on the link to the right under Related Research or by contacting us at info@dbrs.com.

The full report providing additional analytical detail is available by clicking on the link below or by contacting us at info@dbrs.com.