DBRS Morningstar Confirms All Classes of Citigroup Commercial Mortgage Trust 2015-GC27

DBRS, Inc. (DBRS Morningstar) confirmed all classes of Commercial Mortgage Pass-Through Certificates, Series 2015-GC27 issued by Citigroup Commercial Mortgage Trust 2015-GC27 as follows:

-- 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 X-B at A (sf)
-- Class C at A (low) (sf)
-- Class PEZ at A (low) (sf)
-- Class D at BBB (low) (sf)
-- Class X-E at BB (sf)
-- Class E at BB (low) (sf)
-- Class F at B (sf)
-- Class X-F at B (sf)
-- Class G at B (low) (sf)

All trends are Stable.

The confirmation of ratings reflects the overall stable performance of the underlying loans since issuance. As of the February 2020 remittance, there has been a collateral reduction of 7.0% since issuance, with 97 loans of the original 100 loans remaining in the pool. Two loans (Prospectus ID#13 - DoubleTree Little Rock and Prospectus ID#41 - Willow Lake Apartments) have been repaid in full during the last 12 months. The pool is relatively diverse based on loan size as the largest 10 loans represent only 43.1% of the pool balance. The pool is concentrated by property type as retail properties encompass 38.1% of the pool balance. There are also 64 loans, totaling 63.3% of the pool balance, that are secured by properties in tertiary markets. Seven loans, representing 5.1% of the pool balance, are fully defeased.

Loans representing 92.3% of the current pool balance are reporting year-end (YE) 2019 or YE2018 figures, with a weighted-average (WA) debt service coverage ratio (DSCR) and WA loan-to-value ratio (LTV) of 1.73 times (x) and 65.5%, respectively. The figures are an improvement compared with the Issuer’s WA DSCR of 1.62x and the issuance WA LTV of 67.2%.

As of the February 2020 remittance, there are three loans, representing 4.5% of the pool balance, in special servicing and an additional 10 loans, representing 9.0% of the pool balance, on the servicer’s watchlist. The largest loan in special servicing (Prospectus ID#5 – Highland Square) is secured by a 753-bed student housing complex near the main campus of the University of Mississippi and has been real estate owned by the trust since October 2019. The loan was originally transferred to the special servicer in November 2018 after an extended period of cash flow declines. The property was recently appraised in July 2019 for a value of $39.0 million, down from $51.0 million at issuance. The special servicer plans to improve the occupancy rate and market the property for sale in late 2020. The loan was liquidated from the transaction as part of the review, which resulted in an implied loss severity of approximately 15.0%.

The remaining two specially serviced loans are Zane Plaza Shopping Center (Prospectus ID#45 – 0.7% of the pool balance) and Belmont Village (Prospectus ID#68 – 0.4% of the pool balance).

Zane Plaza Shopping Center is a neighborhood retail center in the rural town of Chillicothe, Ohio, that transferred to the special servicer in July 2018 for imminent default after the anchor tenant, Elder-Beerman (48.1% of net rentable area (NRA)), vacated following the parent company’s bankruptcy filing. The special servicer continues to work with the borrower to stabilize the property and is reviewing new leasing activity negotiated by the borrower. The probability of default for this loan was increased to reflect the increased risk.

Belmont Village is secured by a grocery-anchored shopping center in Belmont, North Carolina, and the loan was transferred to the special servicer in October 2019 for imminent default after the grocery store, Bi-Lo (71.8% of NRA) vacated in March 2019. The loan was liquidated from the pool as part of the review with an implied loss severity of approximately 35.0%.

Classes X-A, X-B, 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 are subject to surveillance, which could result in ratings being upgraded, downgraded, placed under review, confirmed, or discontinued by DBRS Morningstar.

DBRS Morningstar provides updated analysis and in-depth commentary in the DBRS Viewpoint platform for the following loans in the transaction:

-- Prospectus ID#1 – Kemper Lakes Business Center (8.9% of the pool)
-- Prospectus ID#5 – Highland Square (3.4% of the pool) – DBRS Morningstar Hotlist
-- Prospectus ID#45 – Zane Plaza Shopping Center (0.7% of the pool)
-- Prospectus ID#68 – Belmont Village (0.4% of the pool) – DBRS Morningstar Hotlist

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 most outstanding CMBS transactions (including non-DBRS Morningstar rated), as well as loan-level and transaction-level commentary for most DBRS Morningstar-rated andmonitored transactions.

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

The principal methodology is the North American CMBS Surveillance 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 Morningstar 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.

For more information regarding rating methodologies and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/357883.

The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar 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 [email protected].

DBRS, Inc.
22 West Washington Street
Chicago, IL 60602