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 2014-C18 commercial mortgage pass-through certificates:
--$52,231,000 class A-1 'AAAsf'; Outlook Stable;
--$85,216,000 class A-2 'AAAsf'; Outlook Stable;
--$23,484,000 class A-3 'AAAsf'; Outlook Stable;
--$87,500,000 class A-4A1 'AAAsf'; Outlook Stable;
--$87,500,000 class A-4A2 'AAAsf'; Outlook Stable;
--$267,029,000 class A-5 'AAAsf'; Outlook Stable;
--$67,360,000 class A-SB 'AAAsf'; Outlook Stable;
--$725,382,000 a class X-A 'AAAsf'; Outlook Stable;
--$69,426,000 a class X-B 'AA-sf'; Outlook Stable;
--$55,062,000 b class A-S 'AAAsf'; Outlook Stable;
--$69,426,000 b class B 'AA-sf'; Outlook Stable;
--$37,107,000 b class C 'A-sf'; Outlook Stable;
--$161,595,000b class EC 'A-sf'; Outlook Stable;
--$56,259,000c class D 'BBB-sf'; Outlook Stable;
--$19,152,000c class E 'BBsf'; Outlook Stable;
--$11,970,000c class F 'Bsf'; Outlook Stable.
a Notional amount and interest only.
b Class A-S, B, and 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Fitch does not rate the $38,303,883 non-rated class or the $69,425,883 interest-only class X-C. Class X-B has been withdrawn from the deal structure since Fitch issued its expected ratings on Feb. 11, 2014. The classes above reflect the final ratings and deal structure.
The certificates represent the beneficial ownership in the trust, primary assets of which are 51 loans secured by 83 commercial properties having an aggregate principal balance of approximately $957.6 million as of the cutoff date. The loans were contributed to the trust by JPMorgan Chase Bank, National Association; Barclays Bank PLC; Redwood Commercial Mortgage Corporation; Starwood Mortgage Funding II LLC; and RAIT Funding, LLC.
Fitch reviewed a comprehensive sample of the transaction's collateral, including site inspections on 72.7% of the properties by balance, cash flow analysis on 71.9%, and asset summary reviews on 71.9% of the pool.
The transaction has a Fitch stressed debt service coverage ratio (DSCR) of 1.16x, a Fitch stressed loan-to-value (LTV) of 100.4%, and a Fitch debt yield of 9.1%. Fitch's aggregate net cash flow represents a variance of 6.8% to issuer cash flows.
KEY RATING DRIVERS
Fitch Leverage: This transaction has slightly lower leverage than other recent Fitch-rated fixed-rate deals. The pool's Fitch LTV of 100.4% is below the 2013 average of 101.6%. However, excluding the credit opinion loan, the pool's Fitch LTV is 103.5%. The pool's Fitch DSCR of 1.16x is below the 2013 average of 1.29x. The conduit DSCR is 1.15x, excluding the credit opinion loans.
Pool Concentration: The pool is more concentrated by loan size and sponsor than average transactions from 2013, as evidenced by a loan concentration index (LCI) of 479 and sponsor concentration index (SCI) of 479. Also the 10 largest loans represent 58.6% of the total pool balance, which is higher than the average 2013 top 10 concentration of 54.5%.
High Retail Concentration: The pool has an above-average concentration of retail properties at 52.4%; six of the 10 largest assets are retail properties. The average retail concentration in 2013 was 33.2%. The largest property type is retail (52.4%), followed by multifamily (13.9%) and hotel (11.9%).
Credit Opinion Loan: The largest loan in the pool, Miami International Mall (10.4%), has a Fitch rating of 'BBB-sf' on a stand-alone basis. The loan is collateralized by a super-regional mall in Miami, FL. This loan participation is a $100 million, controlling pari passu portion of a $160 million loan.
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 2014-C18 pool could withstand a 62.0% decline in value (based on appraised values at issuance) and an approximately 19.6% decrease to the most recent actual cash flow prior to experiencing a $1 of loss to the 'BBB-sf' rated class. Additionally, Fitch found that the pool could withstand a 69.4% decline in value and an approximately 35.3% 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 accompanying pre-sale report.
The master servicer will be Midland Loan Services, rated 'CMS1?' by Fitch. The special servicer will be LNR Partners, LLC, rated 'CSS1-' 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)
Applicable Criteria and Related Research:
Counterparty Criteria for Structured Finance and Covered Bonds
U.S. Commercial Mortgage Servicer Rating Criteria -- Effective Feb. 18, 2011 to Feb. 14, 2014
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