Morningstar DBRS Finalizes Provisional Credit Ratings to J.P. Morgan Chase Commercial Mortgage Securities Trust 2025-BHR5

DBRS, Inc. (Morningstar DBRS) finalized its provisional credit ratings to the following classes of Commercial Mortgage Pass-Through Certificates, Series 2025-BHR5 (the Certificates) to be issued by J.P. Morgan Chase Commercial Mortgage Securities Trust 2025-BHR5 (the Issuer):

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

All trends are Stable.

The transaction is collateralized by the borrower's fee-simple interest in five full-service hospitality properties located across four states and Puerto Rico. The portfolio consists of 1,789 owned keys, including four properties representing 1,384 keys under the Marriott brand family (Ritz Carlton Reserve, Notary, Autograph Collection, and Marriott) and one property under the Sofitel brand. At Dorado Beach, Ritz Carlton Reserve (Dorado Beach), 15 non-collateral, third-party owned condominium units participate in a nightly rental program that equates the maximum available days to 100% participation of 10 units, thus taking the total number of keys in the portfolio to 1,799. The properties were constructed between 1999 and 2012 and have a weighted-average (WA) year built of 2004 and a WA renovation year of 2019.

The portfolio averages 360 keys; however, the property with the lowest number of keys, Dorado Beach, has the highest Issuer net cash flow (NCF) as it generated a revenue per available room (RevPAR) of $1,409.37 at YE2024. Dorado Beach and Marriott Seattle together account for 57.8% of the Issuer NCF while the property with the highest number of keys, The Notary, account for 20.1% of the Issuer NCF. The portfolio's total RevPAR for YE2024 surpassed that of 2019 and has fully recovered from the coronavirus pandemic-related downturn, with the exception of The Clancy in San Francisco, which is still experiencing lower occupancy rates and subsequently lower RevPAR. Both The Notary and The Clancy underwent extensive renovation in 2020. The portfolio's RevPAR declined by a staggering 73.2% in YE2020 from YE2019 mostly because of this stark decline in occupancy. By YE2022, the portfolio achieved a RevPAR of $232.78, exceeding the YE2019 RevPAR of $214.99, driven by a 22.0% increase in the average daily rate (ADR) over 2019 levels. From 2023 to 2024, the portfolio's RevPAR increased by 2.1%, indicating softening growth; however, the portfolio's lackluster RevPAR growth is predominately driven by The Clancy's performance where RevPAR declined by 8.6% in the same period. Morningstar DBRS concluded a RevPAR of $253.53, which is 17.9% above the 2019 figure, 0.7% below the YE2023 figure, and 2.7% below the YE2024 figure.

The transaction sponsor is Braemar Hotels & Resorts Inc. (Braemar), a real estate investment trust focused on investing in luxury hotels and resorts. Founded in 2013, Braemar owns interests in 15 hotel properties in seven states, the District of Columbia, Puerto Rico, and St. Thomas in the U.S. Virgin Islands, totaling 3,799 total rooms as of July 2024. Braemar trades on the New York Stock Exchange under the ticker BHR. Ashford Inc. (Ashford) is the advisor for all hotel properties that Braemar owns and operates. Ashford is a provider of asset management and other services to companies primarily in the hospitality industry.

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 non-payment 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 Spread 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 (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 Single-Asset/Single-Borrower Ratings Methodology (February 26, 2025), https://dbrs.morningstar.com/research/448962

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.

-- North American Commercial Mortgage Servicer Rankings (August 23, 2024),
https://dbrs.morningstar.com/research/438283
-- 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

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