NEW YORK--(BUSINESS WIRE)--Fitch Ratings has affirmed 11 classes of Citigroup Commercial Mortgage Trust, commercial mortgage pass-through certificates series 2013-GCJ11. A detailed list of rating actions follows at the end of this press release.
KEY RATING DRIVERS
The affirmations are based on the stable performance of the underlying collateral pool. There have been no delinquent or specially serviced loans since issuance. As of the April 2014 distribution date, the pool's aggregate principal balance has been reduced by 1.1% to $1.19 billion from $1.21 billion at issuance. No loans are defeased.
The largest loan in the pool (7.2%), 39 Broadway, is secured by a 448,349 square foot (sf) office building located in the Financial District of New York City. As reported by the servicer, the property's occupancy increased to 100% as of September from 96% as of February 2013.
The second largest loan (5.9%), Empire Hotel & Retail, is collateralized by a 423 key hotel located on Manhattan's Upper West Side. The property features a lobby bar and lounge, a pool deck and bar, three meeting places, an indoor/outdoor pool, a fitness center and a business center. The retail portion of the property is leased to five third-party tenants including the rooftop lounge. Comparing the year-end 2013 to year-end 2012 financials, the property's occupancy, average daily rate (ADR) and revenue per available room (RevPAR) all increased to 88.1% versus 86.7%, $251 versus $243 and $224 versus $212, respectively.
The third largest loan (5.5%), Christown Spectrum, is secured by a 1,038,765 sf (850,638 sf of which is collateral) retail center located in Phoenix, AZ. The property, which is the oldest continuously operated shopping mall in Phoenix, was built in phases from 1961 to 1984 and underwent a $10 million renovation completed in 2007. The mall is anchored by Walmart, Costco, Target (non-collateral), and JC Penney. The servicer-reported occupancy increased slightly to 97.8% as of year-end 2013 from 96.2% as of year-end 2012.
The sixth largest loan (4%), 127 West 25th Street, is secured by a 104,000 sf office building in the Chelsea neighborhood of New York City. The property is 100% leased by the Bowery Residence Community (BRC), a non-profit organization providing multiple charitable services for the homeless. As mentioned in Fitch's presale report, a zoning dispute and a pending litigation regarding the property's land use was a listed concern. In October 2010, the Chelsea Flatiron Coalition (CFC) commenced a proceeding seeking an injunction against the property's conversion to a homeless shelter and offices and an annulment of a prior judgment approving such a conversion. In June 2013, a New York appeals court affirmed the dismissal of the suit by the CFC stating the building was a grandfathered shelter.
All classes maintain Stable Outlooks. Due to the recent issuance of the transaction and stable performance, Fitch does not foresee positive or negative ratings migration until a material economic or asset level event changes the transaction's portfolio-level metrics. Additional information on rating sensitivity is available in the report 'CGCMT 2013-GCJ11' (April 10, 2013), available at www.fitchratings.com.
Fitch affirms the following classes as indicated:
--$62.9 million class A-1 at 'AAAsf'; Outlook Stable;
--$290.4 million class A-2 at 'AAAsf'; Outlook Stable;
--$150 million class A-3 at 'AAAsf'; Outlook Stable;
--$236.2 million class A-4 at 'AAAsf'; Outlook Stable;
--$92.9 million class A-AB at 'AAAsf'; Outlook Stable;
--$104.1 million class A-S at 'AAAsf'; Outlook Stable;
--$75.4 million class B at 'AA-sf'; Outlook Stable;
--$42.2 million class C at 'A-sf'; Outlook Stable;
--$58.8 million class D at 'BBB-sf'; Outlook Stable;
--$21.1 million class E at 'BBsf'; Outlook Stable;
--$18.1 million class F at 'Bsf'; Outlook Stable;
--$948.8 million* class X-A at 'AAAsf'; Outlook Stable;
--$117.6 million* class X-B at 'A-sf'; Outlook Stable.
*Notional amount and interest-only.
Fitch does not rate the class G certificates.
A comparison of the transaction's Representations, Warranties, and Enforcement (RW&E) mechanisms to those of typical RW&Es for the asset class is available in the following report:
--'CGCMT Commercial Mortgage Trust 2013-GCJ11 -- Appendix' (April 10, 2013).
Additional information on Fitch's criteria for analyzing U.S. CMBS transactions is available in the Dec. 11, 2013 report, 'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria', which is available at 'www.fitchratings.com' under the following headers:
Structured Finance >> CMBS >> Criteria Reports
Additional information is available at 'www.fitchratings.com'.
Applicable Criteria and Related Research:
--'Global Structured Finance Rating Criteria' (May 24, 2013);
--'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria' (Dec. 11, 2013).
Applicable Criteria and Related Research:
Global Structured Finance Rating Criteria
U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria