DBRS Assigns Provisional Ratings to CSAIL 2019-C16 Commercial Mortgage Trust

DBRS, Inc. (DBRS) assigned provisional ratings to the following classes of Commercial Mortgage Pass-Through Certificates, Series 2019-C16 to be issued by CSAIL 2019-C16 Commercial Mortgage Trust:

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

All trends are Stable.

The collateral consists of 47 fixed-rate loans secured by 96 commercial and multifamily properties. The transaction is a
sequential-pay pass-through structure. Two loans in the pool, accounting for 10.2% of the pool, are shadow-rated investment grade by DBRS. The conduit pool was analyzed to determine the provisional ratings, reflecting the long-term probability of loan default within the term and its liquidity at maturity. When the cut-off loan balances were measured against the DBRS Stabilized Net Cash Flow and their respective actual constants, no loans had a DBRS Term Debt Service Coverage Ratio (DSCR) below 1.15 times (x), a threshold indicative of a higher likelihood of mid-term default. The weighted-average (WA) loan-to-value (LTV) ratio of the pool was 61.4% with a WA of 56.8% at maturity.

Seven loans, representing 22.3% of the pool, are secured by properties that are located in areas with a market rank of 7 or 8, which are characterized as highly dense, urbanized areas. These areas tend to have increased liquidity that benefits from consistent investor demand, even in times of stress. All seven of the properties are located in the New York City area. In addition, 13 loans, which account for 32.7% of the pool, have an at issuance LTV of less than 60.0%. Historical data generally demonstrates that loans with lower LTVs at issuance have a lower probability of default. Two loans, representing 10.2% of the pool, 3 Columbus Circle and 787 Eleventh Avenue, exhibit credit characteristics consistent with investment-grade shadow ratings. The 3 Columbus Circle loan exhibits credit characteristics consistent with a BBB (high) shadow rating and 787 Eleventh Avenue exhibits credit characteristics consistent with an A (low) shadow rating. Seven loans, which account for 19.4% of the pool and 22.8% of the DBRS sample, are considered to have Above Average or Average (+) property quality based on physical attributes and/or a desirable location within their respective markets.

Eight loans, which represent 12.4% of the pool, are secured by single-tenant properties. The largest of these loans is the headquarters of Darden Restaurants, Inc., a multi-brand restaurant operator headquartered in Orlando, Florida, representing 3.8% of the pool balance and 30.7% of the single-tenant concentration. Four of the properties are secured by free-standing fitness centers. Loans secured by properties occupied by single tenants are seen to be more exposed to event risk around their single tenant compared with properties with more diversified rent rolls.

No properties were considered to be Below Average or Average (-) property quality. Higher-quality properties are more
likely to retain existing tenants/guests and more easily attract new tenants/guests, resulting in more stable performance.

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

For supporting data and more information on this transaction, please log into www.viewpoint.dbrs.com.

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

With regard to due diligence services, DBRS was provided with the Form ABS Due Diligence-15E (Form-15E), which contains a description of the information that a third party reviewed in conducting the due diligence services and a summary of the findings and conclusions. While due diligence services outlined in Form-15E do not constitute part of DBRS’s methodology, DBRS used the data file outlined in the independent accountant’s report in its analysis to determine the ratings referenced herein.

The principal methodology is North American CMBS Multi-borrower Rating Methodology, which can be found on www.dbrs.com under Methodologies & Criteria. 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, which can be found on www.dbrs.com in the Commentary tab under Regulatory Affairs. 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 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.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the rating process. Please note a sensitivity analysis is not performed for CMBS bonds rated CCC or lower. The DBRS long-term rating scale definition indicates that ratings of CCC or lower are assigned when the bond is highly likely to default or default is imminent, thereby prevailing over a sensitivity analysis.

The full report providing additional analytical detail is available by clicking on the link under Related Documents below or by contacting us at info@dbrs.com.

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

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