DBRS Confirms Ratings on GS Mortgage Securities Trust 2013-GCJ14

DBRS Limited (DBRS) has today confirmed all classes of Commercial Mortgage Pass-Through Certificates, Series 2013-GCJ14 (the Certificates) issued by GS Mortgage Securities Trust 2013-GCJ14 as follows:

-- 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-5 at AAA (sf)
-- Class A-AB at AAA (sf)
-- Class A-S at AAA (sf)
-- Class X-A at AAA (sf)
-- Class B at AA (sf)
-- Class C at A (high) (sf)
-- Class PEZ at A (high) (sf)
-- Class D at BBB (sf)
-- Class X-C at B (high) (sf)
-- Class E at BBB (low) (sf)
-- Class F at BB (sf)
-- Class G at B (sf)

Class PEZ is exchangeable with Classes A-S, B and C and vice versa. All trends are Stable.

The rating confirmations reflect the overall stable performance of the transaction, which has experienced a collateral reduction of 6.3% since issuance with 81 of the original 84 loans remaining in the pool as of the June 2017 remittance report. There are two loans, representing 2.7% of the pool, that are fully defeased and scheduled to mature in July 2018. The remainder of the loans in the pool are scheduled to mature in 2023.

Based on the reported figures for YE2016, the transaction benefits from a healthy in-place weighted-average (WA) debt service coverage ratio (DSCR) of 1.80 times (x) and debt yield of 11.4% compared with the issuance levels of 1.70x and 10.4%, respectively, for the pool. The performance for the largest 15 non-defeased loans has also been strong since issuance with WA net cash flow growth of 14.3% over the DBRS issuance figures and a WA DSCR of 1.86x based on YE2016 reporting.

As of the June 2017 remittance report, there are nine loans, representing 19.9% of the pool (including three in the Top 15), that are on the servicer’s watchlist. Two of those loans, both in the Top 15 and representing 13.0% of the pool, are on the watchlist for non-performance issues and are expected to be removed from the watchlist with the July 2017 remittance. An additional five loans, representing 6.3% of the pool (including one in the Top 15), are being monitored for performance issues related to occupancy and upcoming tenant rollover. The remainder of the watchlisted loans are being monitored for cash flow declines.

The ratings assigned to the Class C, D, E, F G and PEZ notes materially deviate from the higher ratings 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. The deviations are warranted, given the undemonstrated sustainability of loan performance trends.

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 CMBS 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 into DBRS CMBS IReports 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 Multi-borrower Rating Methodology (March 2017) and CMBS North American Surveillance (March 2017), 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.