DBRS Morningstar Confirms All Ratings of BBCMS Trust 2015-SRCH

DBRS Limited (DBRS Morningstar) confirmed its ratings on all classes of the Commercial Mortgage Pass-Through Certificates, Series 2015-SRCH issued by BBCMS Trust 2015-SRCH as follows:

-- Class A-1 at AAA (sf)
-- Class A-2 at AAA (sf)
-- Class X-A at AAA (sf)
-- Class B at AA (sf)
-- Class C at A (sf)
-- Class X-B at BBB (high) (sf)
-- Class D at BBB (sf)
-- Class E at BBB (low) (sf)

All trends are Stable.

The rating confirmations reflect the overall stable performance of the transaction, which remains in line with DBRS Morningstar’s expectations at issuance. The transaction is collateralized by the $430.0 million senior portion of $650.0 million in total debt, which includes a $71.0 million junior loan and $149.0 million in mezzanine debt, both held outside the trust. The fixed-rate loan was originally structured with a partial interest-only (IO) period that ended in September 2020, and it is now amortizing on a 30-year schedule through its maturity date in 2027. As of the January 2023 remittance, the outstanding balance has been paid down by 4.1% since issuance. The loan is sponsored by the Jay Paul Company, a privately held San Francisco-based real estate investor.

The loan is secured by Moffett Place, a three-building, 943,056-square foot, Class A office complex in Sunnyvale, California. The property is 100% occupied by an investment-grade-rated tenant, Google LLC (Google), which has a lease, coterminous with the loan’s initial maturity, through 2027 with two seven-year renewal options and no termination options. Google has a large presence in the immediate area with Google Technology Corners less than one mile away and the Googleplex headquarters in Mountain View, California, within five miles. The loan is structured with a cash flow sweep in the event of certain triggers, including Google not providing notice of its intent to renew two years prior to lease expiration.

According to the most recent trailing nine months ended September 30, 2022, financials, the loan reported a debt service coverage ratio (DSCR) of 1.69 times (x), compared with the YE2021 DSCR and YE2020 DSCR of 1.66x and 1.92x, respectively.

ENVIRONMENTAL, SOCIAL, GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance factors that had a significant or relevant effect on the credit analysis.

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/396929 (May 17, 2022).

Classes X-A and X-B are 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.

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

The principal methodology is North American CMBS Surveillance Methodology (October 3, 2022), 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.

The DBRS Morningstar Sovereign group releases baseline macroeconomic scenarios for rated sovereigns. DBRS Morningstar analysis considered impacts consistent with the baseline scenarios as set forth in the following report: https://www.dbrsmorningstar.com/research/384482.

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 [email protected].

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.

For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at [email protected].

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