Morningstar DBRS Confirms Credit Ratings on PACEWELL 8 LLC Transaction

DBRS, Inc. (Morningstar DBRS) confirmed the credit ratings on all classes of securities included in PACEWELL 8 LLC transaction.

CREDIT RATING RATIONALE/DESCRIPTION
Credit rating rationale includes the key analytical considerations.

-- Transaction capital structure, current rating, and sufficient credit enhancement level.
-- Increasing credit enhancement levels in the form of overcollateralization, a liquidity reserve account, and Interest Supplement Amount with senior notes benefiting from subordination of junior notes.
-- The value of the commercial properties that secure the underlying assessments relative to the outstanding balance of the Assessments and the priority of the assessments being senior to a first-lien mortgage.
-- Collateral performance is within expectations with manageable delinquency levels and no losses experienced to date.
-- The ratings are based on timely interest at their respective interest rate and ultimate payment of principal by the final maturity date in accordance with the terms of the transaction documents.
-- The transaction parties' capabilities with regard to origination, underwriting, and servicing.
-- The transaction assumptions consider Morningstar DBRS' baseline macroeconomic scenarios for rated sovereign economies, available in its commentary "Baseline Macroeconomic Scenarios For Rated Sovereigns: March 2025 Update," published on March 26, 2025. These baseline macroeconomic scenarios replace Morningstar DBRS' moderate and adverse COVID-19 pandemic scenarios, which were first published in April 2020.

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 transaction's respective press releases at issuance.

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance factor(s) 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.

Notes:
All figures are in US dollars unless otherwise noted.

The principal methodology applicable to the credit ratings is Morningstar DBRS Master U.S. ABS Surveillance (January 10, 2025) https://dbrs.morningstar.com/research/445740.

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.

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

-- Operational Risk Assessment for U.S. ABS Originators and Servicers (March 26, 2025),
https://dbrs.morningstar.com/research/450709
-- Legal Criteria for U.S. Structured Finance (December 03, 2024),
https://dbrs.morningstar.com/research/444064
-- Rating U.S. Structured Finance Transactions (March 10, 2025),
https://dbrs.morningstar.com/research/449616
-- Rating U.S. Property Assessed Clean Energy (PACE) Securitizations (August 06, 2024)
https://dbrs.morningstar.com/research/437561

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