Morningstar DBRS Confirms Credit Ratings on All Classes of CRSO Trust 2023-BRND

DBRS Limited (Morningstar DBRS) confirmed its credit ratings on the following classes of Commercial Mortgage Pass-Through Certificates, Series 2023-BRND (the Certificates) issued by CRSO Trust 2023-BRND:

-- Class A at AAA (sf)
-- Class B at AA (low) (sf)
-- Class HRR at A (high) (sf)

All trends are Stable.

The credit rating confirmations reflect the overall stable performance of the transaction, which has remained in line with Morningstar DBRS' expectations since issuance as evidenced by the underlying property's strong occupancy rate of nearly 100%, with minimal upcoming tenant rollover concerns, a history of strong in-line sales, and a healthy YE2024 debt service coverage ratio (DSCR) of 1.43 times (x). The transaction, which is collateralized by the borrower's fee-simple and leasehold interest in The Americana at Brand, a 569,959 square foot Class A, luxury lifestyle shopping mall approximately 8.8 miles north of downtown Los Angeles in Glendale, California, benefits from its premier quality and position as one of the few luxury retailers in its competitive set.

The collateral was constructed in 2008 as part of a larger development with 241 luxury rental apartments and 100 residential condominiums that are not part of the collateral. The retail aspect is anchored by a Nordstrom with other major tenants including AMC Theatres, Barnes & Noble, H&M, Amazon Style, and Apple. The property is well located within an affluent and established trade area in Glendale, and benefits from excellent connectivity and accessibility via a plethora of regional thoroughfares.

The fixed rate interest-only (IO) loan has a five-year term with no extension options. Loan proceeds of $450.0 million were used to repay the existing debt of $396.4 million, return $35.0 million of equity to the sponsor, and cover closing costs associated with the transaction. Morgan Stanley Bank, N.A. and Goldman Sachs Bank USA co-originated the mortgage loan to The Americana at Brand, LLC, and Colorado & Orange, LLC, which are indirectly owned and controlled by Century Investments, Inc., which is ultimately controlled by Rick J. Caruso.

The collateral was 99.4% occupied as of the May 2025 rent roll, being nearly fully occupied since issuance. According to the most recent servicer-provided financials, the subject reported a YE2024 net cash flow (NCF) and DSCR of $46.4 million and 1.43x, respectively, which is relatively in line with the Morningstar DBRS issuance-derived figures of $45.5 million and 1.41x, respectively.

For this review, Morningstar DBRS maintained the value of $697.3 million, derived at issuance based on a capitalization rate of 6.5% and a Morningstar DBRS NCF of $45.5 million, which represents a -20.0% variance from the issuance-appraised value of $870.0 million. The Morningstar DBRS loan-to-value (LTV) ratio is 64.5%, compared with an LTV of 51.7% based on the appraised value at issuance. In addition, Morningstar DBRS maintained positive qualitative adjustments for the final LTV sizing benchmarks totaling 9.5% to account for the cash flow volatility given the history of stable occupancy and tenant sales; the property quality given its appeal to high-price-point consumers; and the market fundamentals for the subject's location in a high-income and tourism-friendly area.

Morningstar DBRS' credit ratings on the applicable classes address the credit risk associated with the identified financial obligations in accordance with the relevant transaction documents. Where applicable, a description of these financial obligations can be found in the transactions' respective press releases at issuance.

Morningstar DBRS' long-term credit ratings provide opinions on risk of default. Morningstar DBRS considers risk of default to be the risk that an issuer will fail to satisfy the financial obligations in accordance with the terms under which a long-term obligation has been issued. The Morningstar DBRS short-term debt rating scale provides an opinion on the risk that an issuer will not meet its short-term financial obligations in a timely manner.

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance factors that had a significant or relevant effect on the credit analysis.

A description of how Morningstar DBRS considers ESG factors within the Morningstar DBRS analytical framework can be found in the Morningstar DBRS Criteria: Approach to Environmental, Social, and Governance Factors in Credit Ratings (August 13, 2024): https://dbrs.morningstar.com/research/437781.

All credit ratings are subject to surveillance, which could result in credit ratings being upgraded, downgraded, placed under review, confirmed, or discontinued by Morningstar DBRS.

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

The principal methodology is North American CMBS Surveillance Methodology (February 28, 2025): https://dbrs.morningstar.com/research/448963.

Other methodologies referenced in this transaction are listed at the end of this press release.

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 under Related Documents or by contacting us at info-DBRS@morningstar.com.

The credit rating was initiated at the request of the rated entity.

The rated entity or its related entities did participate in the credit rating process for this credit rating action.

Morningstar DBRS had access to the accounts, management, and other relevant internal documents of the rated entity or its related entities in connection with this credit rating action.

This is a solicited credit rating.

For more information on Morningstar DBRS' policy regarding the solicitation status of credit ratings, please refer to the Credit Ratings Global Policy, which can be found in the Morningstar DBRS Understanding Ratings section of the website: https://dbrs.morningstar.com/understanding-ratings.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the credit rating process.

DBRS Limited
DBRS Tower, 181 University Avenue, Suite 700
Toronto, ON M5H 3M7 Canada
Tel. +1 416 593-5577

The credit rating methodologies used in the analysis of this transaction can be found at: https://dbrs.morningstar.com/about/methodologies.

-- North American Single-Asset/Single-Borrower Ratings Methodology (February 28, 2025)
https://dbrs.morningstar.com/research/448962

-- Morningstar DBRS North American Commercial Real Estate Property Analysis Criteria (September 19, 2024)
https://dbrs.morningstar.com/research/439702

-- Legal Criteria for U.S. Structured Finance (December 3, 2024)
https://dbrs.morningstar.com/research/444064

-- North American Commercial Mortgage Servicer Rankings (August 23, 2024)
https://dbrs.morningstar.com/research/438283

A description of how Morningstar DBRS analyzes structured finance transactions and how the methodologies are collectively applied can be found at (July 17, 2023): https://dbrs.morningstar.com/research/417279.

For more information on this credit or on this industry, visit https://dbrs.morningstar.com or contact us at info-DBRS@morningstar.com.