DBRS Confirms All Classes of JPMBB Commercial Mortgage Trust 2015-C30

DBRS Limited (DBRS) has today confirmed the ratings on the following classes of Commercial Mortgage Pass-Through Certificates, Series 2015-C30 issued by JPMBB Commercial Mortgage Trust 2015-C30:

-- Class A-1 at AAA (sf)
-- Class A-2 at AAA (sf)
-- Class A-3 at AAA (sf)
-- Class A-4 at AAA (sf)
-- Class A-5 at AAA (sf)
-- Class A-S at AAA (sf)
-- Class A-SB at AAA (sf)
-- Class X-A at AAA (sf)
-- Class X-B at AAA (sf)
-- Class X-C at AAA (sf)
-- Class X-D at AAA (sf)
-- Class X-E at AAA (sf)
-- Class X-F at AAA (sf)
-- Class X-NR at AAA (sf)
-- Class B at AA (low) (sf)
-- Class C at A (low) (sf)
-- Class EC at A (low) (sf)
-- Class D at BBB (low) (sf)
-- Class E at BB (low) (sf)
-- Class F at B (sf)

All trends are Stable. DBRS does not rate the first loss piece, Class NR. The Class A-S, Class B and Class C certificates may be exchanged for the Class EC certificates (and vice versa).

The rating confirmations reflect the overall performance of the transaction since issuance in July 2015. The collateral consists of 70 loans secured by 114 properties. As of the July 2016 remittance, the pool has experienced minimal collateral reduction of 0.5% since issuance as a result of loan amortization with all of the original 70 loans remaining in the pool. The pool reported a weighted-average (WA) debt service coverage ratio (DSCR) of 1.61 times (x) and a WA debt yield of 9.0% based on YE2015 financials. At issuance, the pool reported a WA DSCR and debt yield of 1.66x and 8.8%, respectively.

As of the July 2016 remittance, there are no loans on the servicer’s watchlist or in special servicing.

The second-largest loan in the pool, Pearlridge Center (Prospectus ID#2, 5.4% of the current pool) is secured by a 1.1 million square foot (sf) mixed-use super regional shopping center, of which 903,692 sf serves as collateral for this loan. The subject is located in Aiea, Hawaii. The loan represents the A-1 portion of a pari passu loan, which had an original aggregate balance of $130.4 million. The whole loan balance of the loan is $225.0 million. The collateral comprises two main sections: Uptown Pearlridge, which is anchored by a Macy’s, and Downtown Pearlridge, which is anchored by Sears (on a ground lease) and Pearlridge Theaters. The two sections are connected by a monorail. According to YE2015 financials, the loan reported a DSCR of 2.91x, which represents an increase from the DBRS underwritten (UW) DSCR of 2.32x. Based on the most recent rent roll dated March 2016, the property was 94.7% occupied as the collateral portion was 93.4% occupied, which is consistent with the occupancy levels at issuance. The largest collateral tenant, Macy’s, representing 16.6% of the net rentable area (NRA), has a lease expiration of February 2027, passed loan maturity. According to the trailing 12-month May 2016 Tenant Sales Report, Macy’s reported sales of $279.00 per square foot (psf), which represents a 3.8% decline compared with the prior year. Similarly, the Pearlridge Mall Theater and Sears reported a decline in sales of 3.6% and 8.4% over the same period to $354,374 per screen from $374,775 per screen and to $218.00 psf from $238.00 psf, respectively. Despite a drop in sales, the tenants are on long-term leases and the remerchandising and renovation program for Downtown Pearlridge is expected to improve the quality of the subject. This loan is interest only (IO) for the entire term and reported a DBRS Term Refinance (Refi) DSCR of 1.47x with an exit debt yield of 14.3% based on the A-note balance. At issuance, this loan was shadow-rated investment-grade because of its strong credit qualities. DBRS confirms with this review that the performance of the loan remains consistent with investment-grade loan characteristics.

The Scottsdale Quarter loan (Prospectus ID#11, 3.2% of the current pool) is secured by a 541,971 sf mixed-use lifestyle center located in Scottsdale, Arizona. Approximately 62.5% of the subject is retail space and the remaining portion is office space. The loan represents the non-controlling portion of a pari passu loan, which had an original aggregate balance of $42.0 million. The whole loan balance of the loan is $165.0 million. Based on YE2015 reporting, the DSCR for the loan was 2.90x compared with the DBRS UW DSCR of 2.13x. As of the March 2016 rent roll, the property was 94.5% occupied, which is similar to the occupancy of 95.6% at issuance in April 2015. The retail space is anchored by iPic Theaters, representing 8.2% of the NRA, and is on a long-term lease expiring in December 2025. According to the site inspection from June 2015, the property was determined to be in above-average condition. There is an adjacent development which is under construction and is expected to be completed by fall 2016. The new property will not be a part of collateral, but is expected to benefit the subject as it will consist of 275 multifamily units, a 130-150 key hotel, about 96,500 sf of retail and 130,000 sf of office space. This loan is IO for the entire term and reported a DBRS Term Refi DSCR of 1.35x with an exit debt yield of 13.3% based on the A-note balance. At issuance, this loan was shadow-rated investment-grade because of its strong credit qualities. DBRS confirms with this review that the performance of the loan remains consistent with investment-grade loan characteristics.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link to the right under Related Research or by contacting us at info@dbrs.com.

This rating is endorsed by DBRS Ratings Limited for use in the European Union.

The applicable methodologies are North American CMBS Rating Methodology (March 2016) and CMBS North American Surveillance (December 2015), which can be found on our website under Methodologies.

The rated entity or its related entities did participate in the rating process. DBRS had access to the accounts and other relevant internal documents of the rated entity or its related entities.