DBRS Confirms Ratings of FREMF 2013-K33 Mortgage Trust

DBRS has today confirmed the ratings of FREMF 2013-K33 Mortgage Trust, Series 2013-K33, as follows:

-- Class A-1 at AAA (sf)
-- Class A-2 at AAA (sf)
-- Class B at A (high) (sf)
-- Class C at BBB (high) (sf)
-- Class X1 at AAA (sf)
-- Class X2-A at AAA (sf)
-- Class X2-B at AAA (sf)

All trends are Stable.

The rating confirmations reflect the stable performance of the transaction since issuance. The collateral consists of 86 fixed-rate loans secured by 88 multifamily properties. As of the September 2014 remittance report, the pool has a balance of approximately $1.64 billion, representing a collateral reduction of approximately 0.43% since issuance in October 2013. Overall, the loans in the pool have reported stable performance. According to YE2013 reporting, the pool had a weighted-average debt service coverage ratio (DSCR) of 1.78 times (x). Performance of the Top 15 loans is slightly stronger, as the loans are reporting a YE2013 weighted-average DSCR and weighted-average debt yield of 1.81x and 9.7%, respectively. While 96.0% of the pool is reporting YE2013 financials, the remainder of the pool is reporting partial-year figures, which are being annualized by the servicer for the purposes of calculating the updated DSCR.

As of the September 2014 remittance report, there are two loans on the servicer’s watchlist, representing 0.7% of the current pool, and no delinquent or specially serviced loans. Both loans are on the servicer’s watchlist for minor deferred maintenance issues and remain current.

Two of the largest 15 loans are secured by student housing properties, which are considered non-traditional multifamily property types. To minimize volatility from low summer occupancy rates and minimal tenant credit history, the landlords for both properties require 12-month leases accompanied with parental guarantees.

The DBRS analysis included an in-depth review of the top 15 loans and the loans on the servicer’s watchlist, which represent 44.8% of the current pool balance.

DBRS continues to monitor this transaction in its Monthly CMBS Surveillance Report, with additional information on the DBRS viewpoint for this transaction, including details on the largest loans in the pool and loans on the servicer’s watchlist. The October 2014 Monthly CMBS Surveillance Report for this transaction will be published shortly. If you are interested in receiving this report, contact us at info@dbrs.com.

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

The applicable methodologies are CMBS Rating Methodology (January 2012) and CMBS North American Surveillance Methodology (November 2012), which can be found on our website under Methodologies.

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are 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.

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