DBRS Confirms All Ratings of Citigroup Commercial Mortgage Trust 2013-GC15

DBRS Limited (DBRS) confirmed all classes of Commercial Mortgage Pass-Through Certificates, Series 2013-GC15 issued by Citigroup Commercial Mortgage Trust 2013-GC15 as follows:

-- Class A-2 at AAA (sf)
-- Class A-3 at AAA (sf)
-- Class A-4 at AAA (sf)
-- Class A-AB at AAA (sf)
-- Class A-S at AAA (sf)
-- Class X-A at AAA (sf)
-- Class X-C at BB (high) (sf)
-- Class B at AA (high) (sf)
-- Class C at A (sf)
-- Class PEZ at A (sf)
-- Class D at BBB (low) (sf)
-- Class E at BB (sf)
-- Class F at B (high) (sf)

All trends are Stable.

The rating confirmations reflect the overall stable performance exhibited since issuance in 2013. At issuance, the collateral consisted of 92 fixed-rate loans secured by 129 commercial properties. As of the May 2018 remittance, 87 loans remain in the pool with an aggregate principal balance of $1.01 billion, representing a collateral reduction of 9.3% since issuance due to scheduled loan amortization and the full repayment of five loans. Eight loans, representing 7.7% of the pool, are fully defeased. Five loans (23.8% of the pool) are structured with full IO periods, while three loans (9.56% of the pool) have partial IO periods of just a few months remaining.

The pool is relatively diverse by loan size, as the top 10 and top 15 loans only represent 41.7% and 50.5% of the pool, respectively. The transaction is primarily concentrated in retail and hospitality properties as 34.9% of the pool is secured by retail properties, including five loans in the top 15, and 10 loans, representing 14.8% of the pool, are secured by hotel properties, including two loans in the top 15. Overall, the performance for these subsets is healthy, with the most recent financial reporting showing a weighted-average (WA) debt service coverage ratio (DSCR) and debt yield for the retail loans of 1.21 times (x) and 7.3%, respectively, while the hotel properties reported a WA DSCR and debt yield of 1.98x and 13.5%, respectively.

Based on the most recent 2017 financials, the top 15 loans reported a WA DSCR of 1.52x, compared with the year-end (YE) 2016 WA DSCR of 1.49x and WA DBRS Term DSCR of 1.52x, reflective of a WA net cash flow (NCF) growth of 2.0% year over year and 4.8% over the DBRS NCF figures at issuance. Pool-wide, as based on the most recent year-end figures available (83.6% of the pool’s reported YE2017 financials), the WA DSCR and debt yield for all loans were 1.51x and 9.1%, respectively. Throughout the remainder of 2018, 12 loans (19.6% of the pool) are scheduled to mature; however, five of these loans (5.2% of the pool) are fully defeased. For the five non-defeased loans, the analyzed cash flows implied a WA exit DSCR and exit debt yield of 1.23x and 9.8%, respectively, suggesting the overall refinance profile is healthy.

As of the May 2018 remittance, there is one loan (0.5% of the pool) in special servicing and 14 loans (16.3% of the pool) on the servicer’s watchlist. The City Center Building loan (Prospectus ID#34) was transferred to special servicing in December 2015 for imminent default. The property is now real estate owned and is anticipated to be sold sometime in late 2018. DBRS expects the loss severity will be significant, in excess of 80%, with the liquidation of the underlying asset. Of the 14 loans on the servicer’s watchlist, two loans (1.89% of the pool) were flagged due to deferred maintenance, nine loans (9.85% of the pool) were flagged for tenant rollover and three loans (4.54% of the pool) were flagged for upcoming maturity. There is only one small loan on the watchlist with a DSCR below 1.0x, and based on the most recent financials for all 14 watchlisted loans, the WA amortizing DSCR and WA debt yield were 1.55x and 9.6%, respectively.

Classes X-A and X-C 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:

-- Prospectus ID#6 – 735 Sixth Avenue (3.36% of the pool balance)
-- Prospectus ID#7 – Mountain Gate Plaza (3.08% of the pool balance)
-- Prospectus ID#8 – 735 Riverbend Shopping Center (2.67% of the pool balance)
-- Prospectus ID#58 – Stonegate Corporate Center (0.62% of the pool balance)
-- Prospectus ID#35 – Shoppes of Southbay (1.17% of the pool balance)
-- Prospectus ID#51 – Tampa Festival (0.82% of the pool balance)
-- Prospectus ID#67 – City Center Building (0.5% of the pool balance)

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.