DBRS Morningstar Confirms All Classes of JPMBB Commercial Mortgage Securities Trust 2015-C30

DBRS, Inc. (DBRS Morningstar) confirmed the ratings on the Commercial Mortgage Pass-Through Certificates, Series 2015-C30 issued by JPMBB Commercial Mortgage Securities Trust 2015-C30 as follows:

-- Class A-3 at AAA (sf)
-- Class A-4 at AAA (sf)
-- Class A-5 at AAA (sf)
-- Class A-S at AAA (sf)
-- Class A-SB at AAA (sf)
-- Class X-A at AAA (sf)
-- Class X-B at AA (sf)
-- Class B at AA (low) (sf)
-- Class X-C at A (sf)
-- Class C at A (low) (sf)
-- Class EC at A (low) (sf)
-- Class X-D at BBB (sf)
-- Class D at BBB (low) (sf)
-- Class X-E at BB (sf)
-- Class E at BB (low) (sf)
-- Class X-F at B (high) (sf)
-- Class F at B (sf)

All trends are Stable.

The rating confirmations reflect the overall stable performance of the transaction since issuance in July 2015 when the deal closed with an original trust balance of $1.3 billion. The transaction consisted of 70 fixed-rate loans secured by 114 commercial properties at issuance, and as of the March 2020 remittance, there has been a collateral reduction of 11.7% since issuance due to the repayment of six loans and scheduled amortization. Out of the original 70 loans, 64 are currently performing with a weighted-average (WA) debt service coverage ratio (DSCR) and loan-to-value of 1.89 times (x) and 64.9%, respectively. In addition to benefiting from stable cash flow performance since issuance, the largest loans in the pool have performed particularly well in general. Based on partial-year 2019 financials, the top 15 loans (62.1% of the pool) reported a WA DSCR of 1.69x compared with the WA DBRS Morningstar Term DSCR at issuance of 1.45x, representing a WA net cash flow (NCF) growth of 16.1% from the DBRS Morningstar NCF figures for those loans.

There are two top 15 loans being monitored closely by DBRS Morningstar in the One City Centre loan (Prospectus ID#12), which is secured by an office tower in downtown Houston, and Boulevard Square (Prospectus ID#10), which is secured by an anchored retail property in Pembroke Pines, Florida. One City Centre, the second-largest loan on the watchlist, has seen precipitous occupancy declines since issuance, when the property was 83.0% occupied, to the leased rate of approximately 68.2% as of September 2019.
Approximately 63.0% of the net rentable area (NRA) expires by September 2021, including the largest tenant, Waste Management, Inc. (40.5% of the NRA; expires December 2020). Boulevard Square also faces a high tenant rollover as 36.0% of the NRA expires by September 2021. This includes the largest tenant, Ross Dress for Less (13.7% of the NRA; expires January 2021). Additionally, all of the in-place leases are scheduled to expire prior to a few months beyond loan maturity in June 2025, including all major anchor tenants. Given the significant upcoming decline in occupancy, DBRS Morningstar has placed Boulevard Square on the DBRS Morningstar Hotlist.

As of the March 2020 remittance, there are 11 loans, representing 25.0% of the current pool balance, on the servicer’s watchlist and no loans in special servicing. The largest loan on the watchlist apart from deferred maintenance issues, Castleton Park (Prospectus ID#6; 4.2% of the current pool balance), is secured by an office property located in Indianapolis. The loan was placed on the servicer’s watchlist in February 2020 due to the DSCR falling below 1.10x. As of the YE2019 servicer reports, the subject reported a DSCR and occupancy of 1.08x and 74.4%, respectively, compared with YE2018 figures of 1.22x and 70.8%, respectively. The decline was a result of higher-than-expected repairs and maintenance costs in 2019 and scheduled amortization. In addition, 47.0% of the NRA is set to expire by December 2021, including the largest tenant, National Government Services (15.5% of the NRA; expires September 2021). Due to the upcoming high tenant rollover and low performance, DBRS Morningstar increased the loan’s probability of default in the analysis for this review.

DBRS Morningstar has confirmed the shadow ratings on the Pearlridge Center (Prospectus ID#2; 6.1% of the pool) and Scottsdale Quarter (Prospectus ID#11; 3.6% of the pool) loans, as performance remains consistent with investment-grade loan characteristics.

Classes X-A, X-B, X-C, X-D, 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.

A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework and its methodologies can be found at https://www.dbrsmorningstar.com/research/357792.

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#6–Castleton Park
-- Prospectus ID#10–Boulevard Square
-- Prospectus ID#12–One City Center

For complimentary access to this content, please register for the DBRS Viewpoint platform at www.viewpoint.dbrsmorningstar.com. The platform includes issuer and servicer data for most outstanding commercial mortgage-backed security transactions (including non-DBRS Morningstar rated), as well as loan-level and transaction-level commentary for most DBRS Morningstar-rated and -monitored 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.dbrsmorningstar.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.dbrsmorningstar.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.

For more information regarding structured finance rating methodologies and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/358308.

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.

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.

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 Morningstar 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.

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

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