Press Release

DBRS Morningstar Finalizes Provisional Ratings on BX Commercial Mortgage Trust 2023-VLT2

June 06, 2023

DBRS, Inc. (DBRS Morningstar) finalized its provisional ratings on the following classes of Commercial Mortgage Pass-Through Certificates, Series 2023-VLT2 issued by BX Commercial Mortgage Trust 2023-VLT2 (BX 2023-VLT2):

-- Class A at AAA (sf)
-- Class B at AAA (sf)
-- Class C at AA (high) (sf)
-- Class D at A (low) (sf)
-- Class E at BBB (low) (sf)
-- Class F at BB (low) (sf)
-- Class G at B (high) (sf)
-- Class HRR at B (sf)

All trends are Stable.

BX 2023-VLT2 is a single-asset/single-borrower transaction collateralized by the borrower’s fee-simple interest in two data center properties and the borrower's leased-fee interest in one data center property and one mixed-use development across four U.S. states. DBRS Morningstar generally takes a positive view on the credit profile of the overall transaction based on the portfolio's favorable market position, affordable power rates, desirable efficiency metrics, strong tenancy profile, and stability of cash flows from the leased-fee assets. At the time, QTS comprised a portfolio of 28 data center properties that supported 366 megawatts (MW) of critical power. Currently, QTS’ data center portfolio consists of 36 properties in the United States and Europe totaling approximately 1,200 MW of critical power.

Data centers, while having existed in one form for another for many years, have become a key component in the modern global technology industry. The advent of cloud computing, streaming media, file storage, and artificial intelligence applications has increased the need for these facilities over the last 10 years in order to manage, store, and transmit data globally. While previous incarnations of data centers were often constructed in existing buildings and converted, the needs of the market have begun to require purpose-built facilities that are engineered for this single use.

From the standpoint of the physical plants, the data center assets are heavily powered with over 80 MW of critical IT load. DBRS Morningstar views the data center collateral as strong assets with a strong critical infrastructure, including power and redundancy that is built to accommodate technology needs of not only today, but also well into the future.

There were no Environmental/Social/Governance factor(s) 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 (May 17, 2022).

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

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

The principal methodology is the North American Single-Asset/Single-Borrower Ratings Methodology (February 23, 2023;

Other methodologies referenced in this transaction are listed at the end of this press release.

With regard to due diligence services, DBRS Morningstar 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 Morningstar’s methodology, DBRS Morningstar used the data file outlined in the independent accountant’s report in its analysis to determine the ratings referenced herein.

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:

The rating was initiated at the request of the rated entity.

The rated entity or its related entities did participate in the rating process for this rating action.

DBRS Morningstar had access to the accounts, management and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

This is a solicited credit rating.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the rating process.

DBRS, Inc.
22 West Washington Street
Chicago, IL 60602 USA
Tel. +1 312 332-3429

The rating methodologies used in the analysis of this transaction can be found at:

DBRS Morningstar North American Commercial Real Estate Property Analysis Criteria (September 12, 2022)

Legal Criteria for U.S. Structured Finance (December 7, 2022)

Interest Rate Stresses for U.S. Structured Finance Transactions (August 30, 2022)

North American Commercial Mortgage Servicer Rankings (September 8, 2022)

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