DBRS Confirms All Classes of Morgan Stanley Bank of America Merrill Lynch Trust 2015-C23

DBRS Limited (DBRS) has today confirmed the following ratings on the Commercial Mortgage Pass-Through Certificates, Series 2015-C23 issued by Morgan Stanley Bank of America Merrill Lynch Trust 2015-C23:

-- Class A-1 at AAA (sf)
-- Class A-2 at AAA (sf)
-- Class A-3 at AAA (sf)
-- Class A-4 at AAA (sf)
-- Class A-S at AAA (sf)
-- Class A-SB at AAA (sf)
-- Class X-A at AAA (sf)
-- Class X-B at AAA (sf)
-- Class B at AA (sf)
-- Class C at A (sf)
-- Class PST at A (sf)
-- Class D at BBB (low) (sf)
-- Class E at BB (sf)
-- Class F at B (high) (sf)
-- Class X-FG at B (sf)
-- Class G at B (low) (sf)

All trends are Stable.

The rating confirmations reflect the overall stable performance of the transaction, which has remained in line with DBRS’s expectations since issuance. As of the May 2017 remittance, there has been a collateral reduction of 1.2% as a result of scheduled amortization. Loans representing 22.7% of the current pool balance are reporting partial-year 2017 financials and loans representing 85.7% of the current pool balance are reporting YE2016 figures. According to the YE2016 financials, the pool reported a weighted-average (WA) debt service coverage ratio (DSCR) and WA debt yield of 1.61 times (x) and 9.0%, respectively. The DBRS WA DSCR and WA debt yield at issuance were 1.64x and 8.6%, respectively. The largest 15 loans in the pool represent 57.3% of the transaction balance and 13 of those loans, representing 46.5% of the current pool balance, reported YE2016 financials, which showed a WA net cash flow growth of 7.8% over the DBRS issuance figures with a WA DSCR and WA debt yield of 1.67x and 8.8%, respectively.

At issuance, two loans, representing 9.2% of the current pool balance, were shadow-rated investment-grade. DBRS has today confirmed that the performance of these loans remains consistent with investment-grade loan characteristics.

As of the May 2017 remittance, there were 11 loans on the servicer’s watchlist, representing 7.6% of the current pool balance, including one loan in the top 15 (Prospectus ID #16 – Aviare Place Apartments; 2.0% of the current pool balance), which was flagged for a depressed DSCR.

The rating assigned to Class F materially deviates from the higher rating implied by the quantitative results. DBRS considers a material deviation to be a rating differential of three or more notches between the assigned rating and the rating implied by the quantitative results that is a substantial component of a rating methodology; in this case, the assigned rating that reflects the sustainability of loan performance trends has not yet been demonstrated.

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

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

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.

The principal methodologies are 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.