NEW YORK--(BUSINESS WIRE)--Fitch Ratings has affirmed 15 classes of GS Mortgage Securities Trust 2013-GC13 commercial mortgage pass-through certificates, series 2013-GC13. A detailed list of rating actions follows at the end of this release.
KEY RATING DRIVERS
The affirmations are based on stable performance of the underlying collateral pool since issuance. As of the May 2016 distribution date, the pool's aggregate principal balance has been reduced by 2.5% to $1.3 billion from $1.334 billion at issuance. There have been no delinquent or specially serviced loans since issuance.
There are seven loans on the servicer watch list (5.5% of the pool); the loans are on the watch list due to deferred maintenance and declines in occupancy and debt service coverage ratio (DSCR).
The largest watch list loan and Fitch Loan of Concern (1.6% of the pool) is the Warehouse & Flex Portfolio loan; a portfolio of four warehouse/flex buildings consisting of 216,415 sf located in Bucks County, PA (suburban Philadelphia). The sole tenant at one of the properties, Asset Management Specialists (18.7% of NRA, 40,500 sf) vacated upon lease expiration in September 2015. Near-term rollover was a consideration at issuance and at closing a $2.275 million reserve was funded to address potential rollover in 2015 for the lease expirations of L-3 Communications (33% of NRA, lease extended to December 2020 from December 2015), Vestcom New Century (19.3% of NRA, lease extended to March 2017 from March 2015), and Asset Management Specialists. With successful lease extensions for L-3 Communications and Vestcom New Century, the leasing reserve is available to cover shortfalls related to Asset Management Specialists' former space. Occupancy has declined to 71% as of 1Q 2016. Net operating income (NOI) DSCR was 1.32x and 1.03x as of year-end (YE) 2015 and 1Q 2016, respectively, as a result of the decrease in occupancy. Fitch will continue to monitor.
The largest loan in the pool (11.5% of the pool) is the 11 West 42nd Street loan, a 943,701 square foot (sf), 32-story office tower located in midtown New York, NY. The property was originally built in 1927 and renovated in 1978. As of the September 2015 rent roll, major tenants included CIT Group, Inc. (16% net rentable area [NRA], expires October 2021), NYU (11.9% NRA, expires September 2021), Estee Lauder Companies Inc. (11.9% NRA, expires March 2025) and WellPoint Holding Corp (11.2%, expired December 2015). While the WellPoint lease renewal has not been confirmed, the office submarket is strong, and subject occupancy was 100% with NOI DSCR at 2.53x as of YE 2015.
The second largest loan in the pool (11.3% of the pool) is the Mall St. Matthews loan, a 1,020,376 sf regional mall located in Louisville, KY. The mall is anchored by Dillard's (expires December 2045) and Dillard's Men's & Home (expires December 2045), which are not part of the collateral, while JC Penney (expires August 2017) and Forever 21 (expires February 2026) are included in the collateral. Total collateral is 670,376 sf. The property was originally built in 1962 but most recently renovated in 2013. Occupancy was 96% as of December 2015, which is in-line with performance at issuance. NOI DSCR was 1.97x as of YE 2015.
Rating Outlooks for all classes remain Stable, as overall pool performance has been stable since issuance. Fitch does not foresee positive or negative ratings migration until a material economic or asset level event changes the transaction's overall portfolio-level metrics. Upgrades may occur with stable to improved pool performance and significant paydown or defeasance. Additional information on rating sensitivity is available in the report 'GS Mortgage Securities Trust 2013-GC13' (Jan. 17, 2014), available at www.fitchratings.com.
DUE DILIGENCE USAGE
No third party due diligence was provided or reviewed in relation to this rating action.
Fitch has affirmed the following ratings:
--$33.3 million class A-1 at 'AAAsf', Outlook Stable;
--$72.7 million class A-2 at 'AAAsf', Outlook Stable;
--$149.7 million class A-3 at 'AAAsf', Outlook Stable;
--$135 million class A-4 at 'AAAsf', Outlook Stable;
--$420.3 million class A-5 at 'AAAsf', Outlook Stable;
--$89.2 million class A-AB at 'AAAsf', Outlook Stable;
--$98.4 million** class A-S at 'AAAsf', Outlook Stable;
--$88.4 million** class B at 'AA-sf', Outlook Stable;
--$50 million** class C at 'Asf', Outlook Stable;
--$236.8 million** class PEZ at 'Asf', Outlook Stable;
--$76.7 million class D at 'BBB-sf', Outlook Stable;
--$30 million class E at 'BBsf', Outlook Stable;
--$13.3 million class F at 'Bsf', Outlook Stable;
--$998.6 million* class X-A 'AAAsf'; Outlook Stable;
--$30 million* class X-B 'BBsf'; Outlook Stable.
*Notional amount and interest only.
** Class A-S, class B, and class C certificates may be exchanged for class PEZ certificates, and class PEZ certificates may be exchanged for up to the full certificate principal amount of the class A-S, class B and class C certificates.
Fitch does not rate the interest-only class X-C or 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:
--'GS Mortgage Securities Trust 2013-GC13 -- Appendix' (Jan. 17, 2014).
Additional information is available at www.fitchratings.com.
Counterparty Criteria for Structured Finance and Covered Bonds (pub. 14 May 2014)
Criteria for Rating Caps and Limitations in Global Structured Finance Transactions (pub. 28 May 2014)
Global Structured Finance Rating Criteria (pub. 06 Jul 2015)
U.S. and Canadian Fixed-Rate Multiborrower CMBS Surveillance and U.S. Re-REMIC Criteria (pub. 13 Nov 2015)
GS Mortgage Securities Trust 2013-GC13 -- Appendix
Dodd-Frank Rating Information Disclosure Form