NEW YORK--(BUSINESS WIRE)--Fitch Ratings has affirmed all classes of Morgan Stanley Bank of America Merrill Lynch Trust, series 2014-C14 commercial mortgage pass-through certificates and maintained their Stable Outlook. A detailed list of rating actions is provided at the end of this press release.
KEY RATING DRIVERS
The affirmations are due to the overall stable performance of the underlying collateral pool. Fitch reviewed the most recently available financial performance data for the transaction, as well as updated rent rolls for the top 15 loans, which represent 67.2% of the transaction. Of the loans in the pool, 36% reported third quarter 2014 (3Q'14) financials, 27% reported (2Q'14 financials, and 37% reported financials at issuance.
As of the January 2015 distribution date, the pool's aggregate principal balance has been reduced by 0.4% to $1.47 billion from $1.48 billion at issuance. Fitch has not designated any loans as Fitch Loans of Concern, and no loans are in special servicing.
The largest loan in the pool, AmericasMart (9.3% of the pool), is secured by a 7.1 million square foot (sf) wholesale trade market with approximately 4.6 million sf of rentable area in four attached buildings, 3.5 mm sf of which are permanent space. The property is located within the Atlanta CBD and caters to a variety of retailers, wholesalers and manufacturers that engage in wholesale trading. There are more than 1,500 permanent tenants occupying approximately 3.5 million sf, and 1.1 million sf of temporary exhibition space can be leased during trade shows. Sponsored by AMC Inc., the loan is performing in line with issuer underwriting expectations. The servicer reported occupancy for the permanent space as of January 2015 is 88% compared to 85% at issuance.
The second largest loan, 120 Wall Street (9.2%), is secured by a 34-story, class B office property consisting of 651,396 sf, built in 1929 and located in Manhattan's downtown financial district. The largest tenants are Droga5 (14%), Success Academy Charter Schools (8%), and National Urban League (7%) with lease expirations in 2029, 2028, and 2017, respectively. The property is 98.1% occupied as of September 2014 with below-market-average rent of $31.64 per sf. Per REIS, as of 4Q'14, the Downtown NYC office submarket vacancy rate is 11.5% with asking rent of $49.50 per sf. There is approximately 5% upcoming rollover in 2015 and 17% in 2017.
The third largest loan, 116 John Street (8.2%), is secured by a 35-story, residential apartment building in downtown Manhattan consisting of 411 units (157 studios, 225 one-bedrooms, 29 two-bedrooms) and 15,489 sf of commercial space. The property is 96% leased as of December 2014 with below-market- average rent of $3,705 per unit; and the commercial space is 100% occupied. The largest commercial tenants are Our Planet Management (55%), USPS (22%), and Archive Cleaners (4%) with lease expirations in 2017, 2022, and 2027, respectively. Per REIS, as of 4Q'14, the W. Village/Downtown multifamily NYC market vacancy is 2.1% with asking rent $4,221 per unit.
The Rating Outlook for all classes remains Stable. 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 'Morgan Stanley Bank of America Merrill Lynch Trust, Series 2014-C14' (July 16, 2014) available at www.fitchratings.com.
Fitch affirms the following ratings:
--$52,670,609 class A-1 at 'AAAsf'; Outlook Stable;
--$295,600,000 class A-2 at 'AAAsf'; Outlook Stable;
--$90,400,000 class A-SB at 'AAAsf'; Outlook Stable;
--$173,800,000 class A-3 at 'AAAsf'; Outlook Stable;
--$160,000,000 class A-4 at 'AAAsf'; Outlook Stable;
--$256,038,000 class A-5 at 'AAAsf'; Outlook Stable;
--Interest-only class X-A at 'AAAsf'; Outlook Stable;
--$114,593,000 class A-S* at 'AAAsf'; Outlook Stable;
--$81,324,000 class B* at 'AA-sf'; Outlook Stable;
--$264,304,000 class PST* at 'A-sf'; Outlook Stable;
--$68,387,000 class C* at 'A-sf'; Outlook Stable;
--Interest-only X-B at 'AA-sf'; Outlook Stable;
--$66,538,000 class D at 'BBB-sf'; Outlook Stable;
--$20,331,000 class E at 'BB+sf'; Outlook Stable;
--$16,635,000 class F at 'BB-sf'; Outlook Stable;
--$12,938,000 class G at 'B-sf'; Outlook Stable.
*Class A-S, B and C certificates may be exchanged for class PST certificates, and class PST certificates may be exchanged for class A-S, B and C certificates. Fitch does not rate the $62,841,800 class H or the interest-only class X-C.
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:
--'Morgan Stanley Bank of America Merrill Lynch Trust, Series 2014-C14 -- Appendix' (July 16, 2014).
Additional information on Fitch's criteria for analyzing U.S. CMBS transactions is available in the Dec. 10, 2014 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' (Aug. 4, 2014);
--'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria' (Dec. 10, 2014).
Applicable Criteria and Related Research:
U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria
Global Structured Finance Rating Criteria