DBRS Morningstar Confirms Ratings on 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)

Classes E, F, X-E, and X-F were removed from Under Review with Negative Implications where they were placed on August 6, 2020. The trends on Classes E, F, X-E, and X-F are Negative, reflecting the continuing performance challenges to the underlying collateral, many of which have been driven by the impact of the Coronavirus Disease (COVID-19) pandemic. The trends on all other classes are Stable.

The rating confirmations reflect the stable performance of the transaction, which has remained in line with DBRS Morningstar’s expectations. At issuance, the transaction consisted of 70 loans with an original trust balance of $1.3 billion. As of the February 2021 remittance report, 63 loans remained in the transaction with a trust balance of $1.2 billion, representing a collateral reduction of approximately 13.2% since issuance resulting from amortization and the payoff of seven loans. In addition, four loans totaling $23.7 million have defeased.

The 69-02 Garfield Avenue loan (Prospectus ID#51; 0.41% of pool) is the only loan in special servicing. The loan is secured by a restaurant/banquet hall totaling 37,480 square feet (sf) in Queens, New York. The loan transferred to special servicing in September 2020 for maturity default. The stated maturity date was July 6, 2020; however, the borrower initially received a 60-day forbearance that expired in September 2020. According to the most recent servicer commentary, the special servicer and borrower are in active discussions for a modification. The loan remained current through the February 2021 remittance. An updated appraisal completed in November 2020 valued the property at $9.6 million, which implied an LTV of 49.9%.

While not on the servicer’s watchlist, the pool contains two regional malls in the top 15 that are sponsored by Washington Prime Group, which according to a published report from Bloomberg is contemplating a bankruptcy filing after the company failed to make an interest payment on its corporate debt. The larger of the two loans, Pearlridge Center (Prospectus ID#2; 6.2% of pool), is secured by a two-level super-regional Class B mall in Aiea, Hawaii, nine miles northwest of the Honolulu central business district. The subject is the largest enclosed mall in Hawaii. The property is anchored by a Macy’s, Ross Dress for Less, TJ Maxx, Bed Bath & Beyond, and Sears (on a ground lease). In 2019, the sponsors completed a $33 million renovation project that included interior and exterior upgrades, a redesigned dining space, and updated entranceways. The property has maintained stable performance to date as net cash flow is consistent with issuance levels. The property was 90% occupied as of Q3 2020 with a debt service coverage ratio (DSCR) of 2.64 times (x).

Scottsdale Quarter (Prospectus ID#11; 3.6% of pool) is secured by 541,971-sf mixed-use lifestyle center in Scottsdale, Arizona, about 20 miles north of Phoenix. The property is anchored by anchored by Forever 21, Restoration Hardware, Pottery Barn, West Elm, and Apple. The collateral portion of the property is composed of approximately 67.5% of retail space and 32.5% of office space. Occupancy has been trending downward since issuance and experienced its largest decline between 2019 and 2020 when its largest retail tenant, IPIC Theaters (8.2% of net rentable area (NRA)), and Nike (3.4% of NRA) vacated causing occupancy to decrease to 72% as of Q3 2020 from 80% as of YE2019. Occupancy further decreased to 68% in 2021 following the departure of H&M, which represented 4.4% of NRA. The tenant vacated upon its January 2021 lease expiration. Despite these developments, the loan maintained a stable DSCR of 2.04x as of Q3 2020.

DBRS Morningstar is also concerned with the Sunbelt Portfolio (Prospectus ID#3; 5.5% of pool) after occupancy decreased to 67% as of Q4 2020 from 81% as of YE2019. The loan is backed by a portfolio of three office properties, two in Birmingham, Alabama, and one in Columbia, South Carolina, totaling 1.3 million sf. The drop in occupancy between years is largely attributed to the departure of the largest tenant, Wells Fargo Bank, which occupied about 91,000 sf (7% of the portfolio’s NRA) and vacated upon its December 2019 lease expiration while the second-largest tenant, Burr & Forman, downsized its space by 17,419 sf (3% of the portfolio’s NRA) at the Wells Fargo Tower in Birmingham. The tower changed names to the Shipt Tower after an online grocery company backfilled 60,000 sf of the former Wells Fargo space. Based on the December 2020 rent roll, the Shipt Tower was 67.2% occupied, Meridian Tower in Columbia was 95.4% occupied, and the Inverness Center in Birmingham was 55.1% occupied.

DBRS Morningstar 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.

A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://www.dbrsmorningstar.com/research/373262.

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.

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#2 – Pearlridge Center (6.2% of pool)
-- Prospectus ID#11 – Scottsdale Quarter (3.6% of the pool)

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 CMBS 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 North American CMBS Surveillance Methodology (March 6, 2020), which can be found on 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 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.

For more information regarding the structured finance rating approach and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/359905.

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.

Generally, the conditions that lead to the assignment of a Negative or Positive trend are generally resolved within a 12-month period. DBRS Morningstar’s outlooks and ratings are monitored.

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

DBRS, Inc.
140 Broadway, 43rd Floor
New York, NY 10005 USA
Tel. +1 212 806-3277