DBRS Confirms Ratings of Morgan Stanley Bank of America Merrill Lynch Trust 2014-C15, Stable Trends

DBRS Limited (DBRS) has today confirmed Commercial Mortgage Pass-Through Certificates, Series 2014-C15 (the Certificates), issued by Morgan Stanley Bank of America Merrill Lynch Trust 2014-C15 (the Trust) as follows:

-- 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 X-A at AAA (sf)
-- Class X-B at AAA (sf)
-- Class X-C at AAA (sf)
-- Class A-S at AAA (sf)
-- Class B at AA (sf)
-- Class PST at A (high) (sf)
-- Class C at A (high) (sf)
-- Class D at BBB (sf)
-- Class E at BBB (low) (sf)
-- Class F at BB (sf)
-- Class G at BB (low) (sf)
-- Class H at B (low) (sf)

All trends are Stable. DBRS does not rate the first loss piece, Class J.

The rating confirmations reflect that the transaction’s overall current performance remains stable. The collateral consists of 48 fixed-rate loans secured by 76 commercial properties. As of the January 2017 remittance, all 48 loans remain in the pool, with an aggregate outstanding principal balance of approximately $1.05 billion, representing a collateral reduction of 2.4% since issuance as a result of scheduled loan amortization. The pool is concentrated by loan size, as the largest loan, Arundel Mills & Marketplace (Prospectus ID#1), represents 14.1% of the pool, while the Top 10 loans represent 66.8% of the pool. Four loans (22.5% of the pool) are structured with full interest-only (IO) terms, while an additional seven loans (15.9% of the pool) have partial IO periods remaining, ranging from one month to 37 months. Excluding the two loans (2.4% of the pool) secured by defeasance collateral, all loans reported both partial-year 2016 net cash flow (NCF) figures and YE2015 NCF figures. According to the YE2015 NCF figures, the transaction had a weighted-average (WA) debt service coverage ratio (DSCR) and WA debt yield of 2.07 times (x) and 12.6%, respectively, compared with the DBRS original analyzed figures of 1.75x and 10.4%, respectively.

Based on the most recent cash flow reporting, the Top 15 loans reported a WA DSCR of 2.25x, compared with the DBRS original analyzed figure of 1.87x, which is reflective of a WA amortizing NCF growth of 20.8%. As of the January 2017 remittance, there is one loan (1.0% of the pool) in special servicing and three loans (3.4% of the pool) on the servicer’s watchlist.

At issuance, DBRS assigned an investment-grade shadow rating on both the Arundel Mills & Marketplace and the JW Marriott and Fairfield Inn & Suites (Prospectus ID#7, 4.7% of the pool) loans. DBRS confirms that the performance of both loans remains consistent with investment-grade loan characteristics.

The ratings assigned to Classes F, G and H materially deviate from the higher ratings implied by the Large Pool Multi-borrower Parameters. DBRS considers this to be a methodology deviation when there is a rating differential of three or more notches between the assigned rating and the rating implied by the Large Pool Multi-borrower Parameters; in this case, the sustainability of loan performance trends were not demonstrated and, as such, was reflected in the ratings.

DBRS has provided updated loan-level commentary and analysis for larger and/or pivotal watchlisted and specially serviced loans, as well as for the largest 15 loans in the pool, in the DBRS CMBS IReports platform. To view these and future loan-level updates provided as part of DBRS’s ongoing surveillance for this transaction, please log in to DBRS CMBS IReports at www.ireports.dbrs.com.

For more information on these rating actions, please contact us at info@dbrs.com.

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 methodologies are the North American CMBS Rating Methodology (January 2017) and CMBS North American Surveillance (December 2016), which can be found on dbrs.com under Methodologies.

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