NEW YORK--(BUSINESS WIRE)--Fitch Ratings has assigned the following ratings and Rating Outlooks to the J.P. Morgan Chase Commercial Mortgage Securities Trust, Series 2013-C17 commercial mortgage pass-through certificates:
--$62,159,000 class A-1 'AAAsf'; Outlook Stable;
--$67,592,000 class A-2 'AAAsf'; Outlook Stable;
--$210,000,000 class A-3 'AAAsf'; Outlook Stable;
--$319,103,000 class A-4 'AAAsf'; Outlook Stable;
--$98,635,000 class A-SB 'AAAsf'; Outlook Stable;
--$841,354,000 a class X-A 'AAAsf'; Outlook Stable;
--$83,865,000 b class A-S 'AAAsf'; Outlook Stable;
--$62,222,000 b class B 'AA-sf'; Outlook Stable;
--$47,343,000 b class C 'A-sf'; Outlook Stable;
--$193,430,000 b class EC 'A-sf'; Outlook Stable;
--$48,696,000 c class D 'BBB-sf'; Outlook Stable;
--$21,642,000 c class E 'BBsf'; Outlook Stable;
--$12,174,000 c class F 'Bsf'; Outlook Stable.
a Notional amount and interest only.
b Class A-S, class B, and class C certificates may be exchanged for a related amount of class EC certificates, and class EC certificates may be exchanged for class A-S, class B, and class C certificates.
c Privately placed pursuant to Rule 144A.
Fitch does not rate the $48,695,815 class NR or the $82,511,815 interest-only class X-C. Class X-B has been withdrawn from the deal structure since Fitch issued its expected ratings on Dec. 10, 2013. The classes above reflect the final ratings and deal structure.
The certificates represent the beneficial ownership in the trust, primary assets of which are 64 loans secured by 72 commercial properties having an aggregate principal balance of approximately $1.082 billion as of the cutoff date. The loans were contributed to the trust by JPMorgan Chase Bank, National Association; Barclays Bank PLC; General Electric Capital Corporation; Redwood Commercial Mortgage Corporation; and RAIT Funding, LLC.
Fitch reviewed a comprehensive sample of the transaction's collateral, including site inspections on 76.9% of the properties by balance, cash flow analysis of 78.2%, and asset summary reviews on 78.2%.
The transaction has a Fitch stressed debt service coverage ratio (DSCR) of 1.11x, a Fitch stressed loan-to-value (LTV) of 106.7%, and a Fitch debt yield of 8.7%. Fitch's aggregate net cash flow represents a variance of 9.4% to issuer cash flows.
KEY RATING DRIVERS
Fitch Leverage: This transaction has higher leverage than other recent Fitch-rated fixed-rate multiborrower deals. The pool's Fitch LTV of 106.7% is higher than the 2012 and third-quarter 2013 averages of 97.2% and 102.1%, respectively. However, excluding the third-largest loan secured by a multifamily property in New York City, the pool's Fitch LTV is 104.6%.
High Multifamily / Low Lodging Exposure: This pool has an above-average concentration of multifamily properties, which represent 25.5% of the total pool balance. This is above the average 2012 and third-quarter 2013 concentrations of 6.3% and 11.6%, respectively. Additionally, this transaction has a below-average concentration of hotel properties, which represent 8.6% of the total pool balance; the 2012 and third-quarter 2013 average hotel concentrations were 13.5% and 15.6%, respectively.
Increased Percentage of Partial IO Loans: This pool has a significantly higher concentration of partial-interest loans (56.1%) than other recent Fitch-rated fixed-rate multiborrower deals. This is higher than the 2012 and third-quarter 2013 averages of 20.1% and 31.0%, respectively. However, full interest-only loans represent only 1.5% of the pool balance, lower than the 2012 and third-quarter 2013 averages of 13.0% and 16.9%, respectively. The pool is scheduled to amortize approximately 15.1% prior to maturity.
Fitch performed two model-based break-even analyses to determine the level of cash flow and value deterioration the pool could withstand prior to $1 of loss being experienced by the 'BBB-sf' and 'AAAsf' rated classes. Fitch found that the JPMBB 2013-C17 pool could withstand a 39.37% decline in value (based on appraised values at issuance) and an approximately 14.99% decrease to the most recent actual cash flow prior to experiencing $1 of loss to the 'BBB-sf' rated class. Additionally, Fitch found that the pool could withstand a 48.97% decline in value and an approximately 28.45% decrease in the most recent actual cash flow prior to experiencing $1 of loss to any 'AAAsf' rated class.
Key Rating Drivers and Rating Sensitivities are further described in the pre-sale report.
The master servicer will be Wells Fargo Bank, National Association, rated 'CMS1?' by Fitch. The special servicer will be Situs Holdings, LLC, rated 'CSS2' by Fitch.
The presale report is available at 'www.fitchratings.com'.
Additional information is available at 'www.fitchratings.com'.
Applicable Criteria and Related Research:
--Criteria for Analyzing Multiborrower U.S. Commercial Mortgage Transactions (August 2013)
--Global Structured Finance Rating Criteria (June 2012)
--Criteria for Special-Purpose Vehicles in Structured Finance Transactions (May 2012)
--U.S. Commercial Mortgage Servicer Rating Criteria (February 2011)
--U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria (December 2012)
--Counterparty Criteria for Structured Finance Transactions (May 2012)
Applicable Criteria and Related Research:
Feedback Analysis: Counterparty Criteria for Structured Finance Transactions
U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria
U.S. Commercial Mortgage Servicer Rating Criteria
Criteria for Special-Purpose Vehicles in Structured Finance Transactions - Effective 13 June 2011 to 30 May 2012
Global Structured Finance Rating Criteria
Criteria for Analyzing Multiborrower U.S. Commercial Mortgage Transactions