NEW YORK--(BUSINESS WIRE)--Fitch Ratings has affirmed all classes of COMM 2013-GAM Mortgage Trust. The Rating Outlooks remain Stable. A detailed list of rating actions follows at the end of this release.
KEY RATING DRIVERS
The trust certificates represent the beneficial interests in a mortgage loan secured by the Green Acres Mall property located in Valley Stream, NY. The eight-year fixed rate (3.43%) amortizing loan matures in February 2021.
The affirmations are the result of stable collateral performance since origination. Per the second quarter 2014 (2Q'14) rent roll, the property was 96% occupied, in line with performance at issuance. The servicer reported 2Q'14 debt service coverage ratio (DSCR) was 1.84 times (x), compared to 1.60x at year-end (YE) 2013 and 1.76x at issuance.
The Green Acres Mall is a 1,811,441 square foot (sf) enclosed two-level regional mall located on Sunrise Highway in Valley Stream, NY. It is anchored by BJ's Wholesale Club, JC Penney, Kohl's, Macy's, Macy's Men's/Furniture, Sears, and Wal-Mart (subject to ground lease), all of which are part of the collateral. Major in-line tenants include Michael's, Modell's Sporting Goods, Old Navy, H&M, Express, and Victoria's Secret.
The subject property is located in one of the most densely populated areas of Nassau County, providing a strong shopper base for the mall. There are three other malls within an approximate 15-mile radius of Green Acres Mall. Despite the potential for competition, the property's in-line sales remain strong. Comparable in-line sales increased to $574 per square foot (psf) as of trailing 12 months (TTM) June 2014, compared to $501 psf at underwriting. Per the 4Q'14 Reis report, the Long Island retail market had a vacancy rate of 5.3% with average asking rents of $27.21 psf.
As of the January 2015 remittance report, the transaction has paid down 3.5% to $313 million from $324.4 million at issuance. As part of its review, Fitch analyzed the performance of the loan and its underlying collateral. Fitch modeled cash flow based on YE 2013 and 2Q'14 OSARs, as well as the June 2014 rent roll. Fitch stressed the cash flow by excluding revenue from several tenants with lease rollover in 2014/2015.
The Fitch stressed DSCR for the loan is 1.21x, compared to 1.11x modeled at issuance. The Fitch stressed loan-to-value ratio is 73%, which is based on capitalization of the Fitch-adjusted net cash flow at a rate of 7.5%, compared to 79.7% modeled at issuance.
RATING SENSITIVITIES
The Outlook remains Stable for all classes. No rating actions are expected unless there are material changes in property occupancy or cash flow.
Fitch has affirmed the following class as indicated:
--$43.7 million A-1 at 'AAAsf'; Outlook Stable;
--$154.9 million class A-2 at 'AAAsf'; Outlook Stable;
--IO class X-A at 'AAAsf'; Outlook Stable;
--$26 million class B at 'AA-sf'; Outlook Stable;
--$17 million class C at 'Asf'; Outlook Stable;
--$24.8 million class D at 'BBBsf'; Outlook Stable;
--$19 million class E at 'BBB-sf'; Outlook Stable;
--$27.6 million class F at 'BB-sf'; Outlook Stable.
Additional information is available at 'www.fitchratings.com'.
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:
--'COMM 2013-GAM - Appendix' (August 2013).
Applicable Criteria and Related Research:
--'COMM 2013-GAM' (Aug. 5, 2013);
--'Global Structured Finance Rating Criteria' (Aug. 4, 2014);
--'Criteria for Analyzing Large Loans in U.S. Commercial Mortgage Transactions' (Sept. 19, 2014).
Applicable Criteria and Related Research:
COMM 2013-GAM
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=704245
Global Structured Finance Rating Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=754389
Criteria for Analyzing Large Loans in U.S. Commercial Mortgage Transactions
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=772328
Additional Disclosure
Solicitation Status
http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=978755
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