DBRS Confirms Ratings on FREMF 2014-K37 Mortgage Trust, Series 2014-K37

DBRS Limited (DBRS) has today confirmed the ratings on the following classes of Multifamily Mortgage Pass-Through Certificates, Series 2014-K37 issued by FREMF 2014-K37 Mortgage Trust, Series 2014-K37:

-- Class A-1 at AAA (sf)
-- Class A-2 at AAA (sf)
-- Class B at AA (low) (sf)
-- Class C at A (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 overall performance of the transaction, which has remained in line with DBRS’s expectations since issuance. The collateral consists of 102 fixed-rate loans secured by 102 multifamily properties and as of the November 2016 remittance, there had been a collateral reduction of 2.5% since issuance. Loans representing 97.9% of the current pool balance are reporting YE2015 figures with a weighted-average (WA) debt service coverage ratio (DSCR) and a WA debt yield of 1.63 times (x) and 10.4%, respectively. The DBRS underwritten WA DSCR and WA debt yield at issuance were 1.39x and 8.7%, respectively. The largest 15 loans in the pool collectively represent 37.5% of the transaction balance and those loans showed a WA net cash flow growth of 16.6% over the DBRS underwritten figures at YE2015, with a WA DSCR and debt yield of 1.46x and 9.3%, respectively. One loan, representing 1.4% of the current pool balance, is fully defeased.

There were no loans in special servicing as of the November 2016 remittance, but four loans are on the servicer’s watchlist, representing 4.1% of the current pool balance, including one loan in the top 15, Prospectus ID#8 - Summer Wood Apartments that represents 2.2% of the current pool balance. All of these loans were flagged for deferred maintenance items or down units at the properties as a result of either a fire or hail damage; however, the affected loans have sufficient insurance coverage and the properties are currently undergoing repairs. These loans reported a YE2015 WA DSCR and debt yield of 1.80x and 10.0%, respectively, representing a 3.4% increase over the DBRS underwritten figures.

For more information on this transaction and supporting data, please log in to DBRS CMBS IReports at www.ireports.dbrs.com. DBRS continues to monitor this transaction monthly, with periodic updates provided in the DBRS CMBS IReports platform.

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

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

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

For more information on this credit or on this industry, visit ww.dbrs.com or contact us at info@dbrs.com.