Morningstar DBRS Confirms All Credit Ratings on NRTH 2024-PARK Mortgage Trust

DBRS, Inc. (Morningstar DBRS) confirmed its credit rating on all classes of Commercial Mortgage Pass-Through Certificates, Series 2024-PARK issued by NRTH 2024-PARK Mortgage Trust as follows:

--Class A at AAA (sf)
--Class HRR at AAA (sf)

All trends are Stable.

The credit rating confirmations reflect the overall stable performance of the transaction since issuance. The loan is secured by the borrower's fee-simple interest in NorthPark Center, a 1.9 million square-foot Class A luxury super-regional mall located in Dallas. The property benefits from its proximity to the affluent suburbs of the Dallas-Fort Worth Metroplex. The loan is sponsored through a joint venture between NorthPark Management Company (NMC) and J.P. Morgan Asset Management (JPMAM).

The $650 million, interest-only, floating-rate loan has an initial two-year term and includes a three one-year extension option with a fully extended loan maturity of March 2029.

The collateral was 95.6% occupied as of the September 2024 rent roll, relatively unchanged from issuance, with minimal scheduled tenant rollover over the next 12 months. The property is anchored by Neiman Marcus, Nordstrom, Dillard's, Macy's, AMC Theatres and Eataly, which all serve as collateral for the transaction. Tenant sales have remained stable, with the trailing twelve months (T-12) ending in September 2024 reporting in-line sales at $1,075 per square foot (psf), consistent with the in-line sales at issuance

According to the June 2024 financials, the property generated an annualized net cash flow (NCF) of $60.8 million, reflecting a debt service coverage ratio (DSCR) of 1.29 times, a 22.8% decline compared with Morningstar DBRS issuance-derived figures. Morningstar DBRS, however, notes that these figures do not represent a full year of servicer reporting and therefore did not account for them in this review.

At issuance, Morningstar DBRS' derived a value of $1.2 billion, based on a capitalization rate of 6.5% and a Morningstar DBRS NCF of $78.8 million, resulting in a loan-to-value ratio (LTV) of 53.65%. The Morningstar DBRS value represents a variance of -14.6% from the issuance appraised value of $1.42 billion. In addition, Morningstar DBRS maintained positive qualitative adjustments to the LTV-sizing benchmarks totaling 9.25% to reflect the property's high quality, strong market fundamentals, and historically stable occupancy and cash flow.

Morningstar DBRS' credit ratings on the applicable classes address the credit risk associated with the identified financial obligations in accordance with the relevant transaction documents. Where applicable, a description of these financial obligations can be found in the transactions' respective press releases at issuance.

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, or 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 (August 13, 2024) https://dbrs.morningstar.com/research/437781.

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 CMBS Surveillance Methodology (December 13, 2024) https://dbrs.morningstar.com/research/444617.

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

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.

--North American Single-Asset/Single-Borrower Ratings Methodology (December 13, 2024) https://dbrs.morningstar.com/research/444612
--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 (December 3, 2024) https://dbrs.morningstar.com/research/444064
--North American Commercial Mortgage Servicer Rankings (August 23, 2024) https://dbrs.morningstar.com/research/438283
--Interest Rate Stresses for U.S. Structured Finance Transactions (February 26, 2024) https://dbrs.morningstar.com/research/428623

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