DBRS Confirms All Classes of Morgan Stanley Capital I Trust 2015-MS1

DBRS Limited (DBRS) confirmed the ratings on the following classes of Commercial Mortgage Pass-Through Certificates, Series 2015-MS1 issued by Morgan Stanley Capital I Trust 2015-MS1:

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

All trends are Stable.

The rating confirmations reflect the overall stable performance of the transaction since issuance. At issuance, the transaction consisted of 54 loans with a trust balance of $885.0 million. Since issuance, there has been a collateral reduction of 1.7% due to scheduled amortization, with all loans remaining in the pool. The transaction is currently reporting a weighted-average (WA) debt-service coverage ratio (DSCR) and debt yield of 1.66 times (x) and 8.7%, respectively, in comparison to the YE2015 WA DSCR and debt yield of 1.61x and 8.7%, respectively. At issuance, the DBRS WA DSCR and debt yield were 1.81x and 9.0%, respectively. Based on the YE2016 financials, the Top 15 loans are reporting a WA DSCR and debt yield of 1.95x and 8.4%, respectively.

As of the April 2018 remittance, there are no loans in special servicing. Three loans, representing 15.0% of the current pool balance, are on the servicer’s watchlist for vacancy issues. Of note is the HSBC – Brandon, Florida (Prospectus ID#16, 2.0% of the current pool), which was added to the watchlist as HSBC plans on vacating the subject in July 2018, which will leave the property 100% vacant. There are multiple risk-mitigation measures in place in the short term, including a monthly rent reserve capped at $1.9 million, which is comparable to one year of HSBC’s rent. The borrower’s initial focus will be to secure a single tenant before assessing options with multiple tenant configurations.

At issuance, DBRS shadow-rated three loans investment grade. DBRS confirms with this review that the performance of these loans – 32 Old Slip Fee (Prospectus ID#3, 6.9% of the current pool), 841-853 Broadway (Prospectus ID#8, 5.8% of the current pool) and Alderwood Mall (Prospectus ID#5, 5.3% of the current pool) – remains consistent with investment-grade loan characteristics.

Class X-A is an interest-only (IO) certificate that references 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:

-- #2 – 300 South Riverside Plaza Fee
-- #3 – 32 Old Slip Fee
-- #5 – Alderwood Mall
-- #6 – 841-853 Broadway Plaza
-- #7 – Shoppes at Westlake Village
-- #8 – Hilton Garden Inn W 54th Street
-- #16 – HSBC – Brandon, Florida

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.