Morningstar DBRS Finalizes Provisional Credit Ratings on BPR Commercial Mortgage Trust 2024-PARK

DBRS, Inc. (Morningstar DBRS) finalized provisional credit ratings on the following classes of Commercial Mortgage Pass-Through Certificates, Series 2024-PARK (the Certificates) issued by BPR Commercial Mortgage Trust 2024-PARK (the Trust):

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

All trends are Stable.

The BPR 2024-PARK single-asset/single-borrower transaction is collateralized by the borrower's leasehold and subleasehold interest in the Shops at Merrick Park, an 848,280-sf open-air shopping center located in Coral Gables, Florida. Coral Gables is a Miami suburb located approximately five miles southwest of the Miami CBD. The collateral is made up of three components: Shops at Merrick Park, a three-story, open-air shopping center anchored by Nordstrom and Neiman Marcus; Offices at Merrick, a five-story, 126,201-sf office building located adjacent to Shops at Merrick Park; and several subleased parcels that contain residential buildings and parking.

Shops at Merrick Park is well located in Coral Gables close to Miami. The mall has benefited from the growing south Florida population as evidenced by the center's growth in in-line sales psf, which surged to $1,024 for the T-12 ended July 31, 2024, period from $718 in 2019. The property is currently 93.8% leased and has had strong occupancy historically, averaging 97% from 2016 to 2023. The property is leased to a mix of 101 tenants offering a mixture of luxury aspirational products, as well as a movie theater and full-service restaurants. Brookfield executed 67 new and renewal leases totaling nearly 250,000 sf from 2019 to October 2024. Recently, the property has experienced leasing momentum particularly with luxury tenants, as evidenced by the opening of Louis Vuitton and Tory Burch at the property in 2023 and the anticipated opening of David Yurman, Vuori, and Rhone in the coming months. The property is anchored by Nordstrom and Neiman Marcus, which generated $405 psf and $1,062 psf of sales in 2023, respectively, and both recently renewed their leases.

Considering the property's strong sponsorship, asset quality, and favorable location, evidence of increasing in-line sales, and generally consistent occupancy trends, Morningstar DBRS has a generally positive view of the collateral's credit characteristics. Although brick-and-mortar retailers are facing secular headwinds and the continued proliferation of e-commerce continues to gain traction, the collateral has displayed consistent improvement in performance, and sales at the property continue to rise.

Morningstar DBRS' credit ratings on the Certificates address the credit risk associated with the identified financial obligations in accordance with the relevant transaction documents. The associated financial obligations are the related Principal Distribution Amounts and Interest Distribution Amounts for the rated classes.

Morningstar DBRS' credit ratings do not address nonpayment risk associated with contractual payment obligations contemplated in the applicable transaction document(s) that are not financial obligations. For example, the credit ratings do not address Yield Maintenance Premiums.

Morningstar DBRS' long-term credit ratings provide opinions on risk of default. Morningstar DBRS considers risk of default to be the risk that an issuer will fail to satisfy the financial obligations in accordance with the terms under which a long-term obligation has been issued. The Morningstar DBRS short-term debt rating scale provides an opinion on the risk that an issuer will not meet its short-term financial obligations in a timely manner.

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

A description of how Morningstar DBRS considers ESG factors within the Morningstar DBRS analytical framework can be found in the Morningstar DBRS Criteria: Approach to Environmental, Social, and Governance Factors in Credit Ratings at https://dbrs.morningstar.com/research/437781 (August 13, 2024).

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

Notes:

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

The principal methodology is North American Single-Asset/Single-Borrower Ratings Methodology (September 19, 2024), https://dbrs.morningstar.com/research/439699.

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

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

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

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

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

This is a solicited credit rating.

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

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

The credit rating methodologies used in the analysis of this transaction can be found at: https://dbrs.morningstar.com/about/methodologies.

-- Morningstar DBRS North American Commercial Real Estate Property Analysis Criteria (September 19, 2024), https://dbrs.morningstar.com/research/439702.
-- Legal Criteria for U.S. Structured Finance (October 28, 2024), https://dbrs.morningstar.com/research/441840.
-- North American Commercial Mortgage Servicer Rankings (August 23, 2024), https://dbrs.morningstar.com/research/438283.

For more information on this credit or on this industry, visit https://dbrs.morningstar.com/ or contact us at info-DBRS@morningstar.com.