DBRS Confirms All Classes of Wells Fargo Commercial Mortgage Trust 2015-C28

DBRS Limited (DBRS) confirmed the ratings on the Commercial Mortgage Pass-Through Certificates, Series 2015-C28 issued by Wells Fargo Commercial Mortgage Trust 2015-C28 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-SB at AAA (sf)
-- Class A-S at AAA (sf)
-- Class X-A at AAA (sf)
-- Class B at AA (low) (sf)
-- Class C at A (low) (sf)
-- Class PEX at A (low) (sf)
-- Class D at BBB (low) (sf)
-- Class X-E at BB (sf)
-- Class E at BB (low) (sf)
-- Class X-F at B (sf)
-- Class F at B (low) (sf)

All trends are Stable.

The rating confirmations reflect the overall stable performance of the transaction, which has generally remained in line with DBRS’s expectations since issuance. As at the April 2018 remittance, there has been a collateral reduction of 2.4% since issuance with all of the original 99 loans remaining in the pool. Loans representing 83.90% of the current pool balance are reporting YE2017 figures. Based on these financials, those loans reported a weighted-average (WA) debt service coverage ratio (DSCR) and WA debt yield of 1.91 times (x) and 10.8%, respectively. The WA DBRS Term DSCR and DBRS Debt Yield for the overall pool at issuance were 1.53x and 8.5%, respectively. The largest 15 loans in the pool represent 57.7% of the transaction balance and all but three of those loans reported YE2017 financials, with a WA net cash flow increase of 28.1% over the DBRS figures, with a WA DSCR and WA in-place debt yield of 1.93x and 10.1%, respectively.

As at the April 2018 remittance, there are eight loans on the servicer’s watchlist, representing 14.1% of the current pool balance, including two loans in the top 15. In addition, one loan in the top 15, Prospectus ID#12: Flatiron Hotel (2.0% of the current pool balance) is in special servicing for technical and payment default. With a few exceptions in smaller loans, the bulk of the loans on the servicer’s watchlist report a stable DSCR as at the most recent reporting period available, and are being monitored for rollover or other issues. The Flatiron Hotel loan is secured by a 64-key full-service boutique hotel in New York City. The loan transferred to the special servicer in August 2017 and the servicer reports that the bulk of the issues with the property’s performance are due to mismanagement. The loan most recently reported a Q3 2017 DSCR of 0.50x and, as at the April 2018 remittance, is paid through the February 2018 payment date. DBRS assumed a highly stressed scenario for this loan in the analysis for this review, significantly increasing subordination levels as compared with the issuance analysis. For additional information on the DBRS view on this loan, please see the DBRS Viewpoint platform, for which information is provided below.

Classes X-A, X-E and X-F are interest-only (IO) certificates that reference a single rated tranche or multiple rated tranches. The IO rating mirrors the lowest-rated applicable reference obligation tranche adjusted upward by one notch if senior in the waterfall.

All ratings will be subject to ongoing surveillance, which could result in ratings being upgraded, downgraded, placed under review, confirmed or discontinued by DBRS.

As part of this review, DBRS has provided updated analysis and in-depth commentary in the DBRS Viewpoint platform for the following loans in the transaction:

-- TKG 2 Portfolio
-- Eastgate Two Phases VIII-X
-- Milestone Portfolio
-- Flatiron Hotel
-- Cedar Hills Shopping Center
-- Staybridge Suites IAH

For complimentary access to this content, please register for the DBRS Viewpoint platform at www.viewpoint.dbrs.com. The platform includes issuer and servicer data for the entire CMBS universe, as well as deal and loan-level commentary for all DBRS rated transactions.

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

The principal methodology is CMBS North American Surveillance, which can be found on dbrs.com under Methodologies. For a list of the Structured Finance related methodologies that may be used during the rating process, please see the DBRS Global Structured Finance Related Methodologies document on www.dbrs.com. Please note that not every related methodology listed under a principal Structured Finance asset class methodology may be used to rate or monitor an individual structured finance or debt obligation.

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 under Related Documents or by contacting us at info@dbrs.com.

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

The rated entity or its related entities did participate in the rating process for this rating action. DBRS had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

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