DBRS Confirms Ratings of DBRR 2013-EZ3, CMBS Re-REMIC Certificates, Series 2013-EZ3

DBRS, Inc. (DBRS) has today confirmed the ratings on the following classes of CMBS Re-REMIC Certificates (the Certificates) issued by DBRR 2013-EZ3, CMBS Re-REMIC Certificates, Series 2013-EZ3 (the Trust):

-- Class A at AAA (sf)
-- Class X-1 at AAA (sf)
-- Class X-2 at AAA (sf)
-- Class B at A (high) (sf)
-- Class C at A (high) (sf)

All trends are Stable.

The rating confirmations reflect the stable performance of the underlying U.S. commercial mortgage-backed securities (CMBS) assets, which can be attributed to amortization, increased defeasance, loan seasoning and increased credit enhancement because of successful loan repayments at maturity and recoveries on liquidated loans. As a result of this performance, the Trust’s capital structure has amortized 84.8% since issuance in September 2013.

This transaction is a resecuritization, originally collateralized by the beneficial interests in 23 senior CMBS certificates from underlying transactions that were issued between 2004 and 2007. As of the August 2016 remittance, 16 contributing certificates have been repaid in full.

DBRS has analyzed each of the contributed certificates based on the performance of the underlying loans, the deal structures and the various parties to the transactions. DBRS modeled each transaction separately, applying various stresses, including haircuts to all net cash flow figures.

The ratings assigned to the Certificates by DBRS are based exclusively on the credit provided by the transaction structure and underlying trust assets. The Class X-1 and Class X-2 balances are notional. DBRS’s ratings on interest-only certificates address the likelihood of receiving interest based on the notional amount outstanding. DBRS considers the interest-only certificate’s position within the transaction payment waterfall when determining the appropriate rating.

The ratings assigned to Class B and Class C differ from the higher ratings implied by the quantitative model. DBRS considers this difference to be a material deviation, and in this case, the ratings reflect structural features (loans or transactions) and/or provisions in other relevant methodologies that outweigh the quantitative model’s output.

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

The applicable methodologies are North American CMBS Rating Methodology (March 2016) and CMBS North American Surveillance (December 2015), which can be found on our website under Methodologies.

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