Fitch Ratings has affirmed 15 classes of Wells Fargo Commercial Mortgage Trust 2016-NXS6.

Fitch has also revised the Rating Outlook to Negative from Stable on two classes.

RATING ACTIONS

ENTITY/DEBT	RATING		PRIOR

WFCM 2016-NXS6

A-1 95000KAY1

LT	AAAsf 	Affirmed		AAAsf

A-2 95000KAZ8

LT	AAAsf 	Affirmed		AAAsf

A-3 95000KBA2

LT	AAAsf 	Affirmed		AAAsf

A-4 95000KBB0

LT	AAAsf 	Affirmed		AAAsf

A-S 95000KBD6

LT	AAAsf 	Affirmed		AAAsf

A-SB 95000KBC8

LT	AAAsf 	Affirmed		AAAsf

B 95000KBG9

LT	AA-sf 	Affirmed		AA-sf

C 95000KBH7

LT	A-sf 	Affirmed		A-sf

D 95000KAJ4

LT	BBB-sf 	Affirmed		BBB-sf

E 95000KAL9

LT	BB-sf 	Affirmed		BB-sf

F 95000KAN5

LT	B-sf 	Affirmed		B-sf

X-A 95000KBE4

LT	AAAsf 	Affirmed		AAAsf

X-B 95000KBF1

LT	AA-sf 	Affirmed		AA-sf

X-D 95000KAA3

LT	BBB-sf 	Affirmed		BBB-sf

X-E 95000KAC9

LT	BB-sf 	Affirmed		BB-sf

VIEW ADDITIONAL RATING DETAILS

KEY RATING DRIVERS

Increased Loss Expectations: Although overall pool performance remains generally stable, loss expectations have increased due to several Fitch Loans of Concern (FLOC). Fitch has identified 12 FLOCs (22.8%) due to deteriorating performance or expected performance declines from the coronavirus pandemic. Five (16.1%) are within the top 15. There are four loans (7.5%) in special servicing, all of which are recent transfers and have cited hardships stemming from the coronavirus pandemic and associated economic shutdown.

Fitch Loans of Concern: The largest FLOC, The Falls (4.7%), is secured by an 840,000-sf regional mall/lifestyle center located in Miami, FL. The mall is operated by Simon Property Group. The center is anchored by Macy's (29% of net rentable area (NRA), lease expires July 2027). Former anchor tenant Bloomingdale's went dark in January 2020. The borrower is currently in negotiations to backfill the space. Occupancy is expected to fall to 69.5% with the loss of Bloomingdale's. YE 2019 NOI DSCR was 3.24x. The servicer noted there are no immediate plans to close the Macy's at the subject. Tenant sales at YE 2019 were $684 psf including Apple and $439 psf excluding Apple.

Cassa Times Square Mixed Use (4.6%) is the sixth largest loan and the largest specially serviced loan. The loan is secured by an 86-key independent boutique hotel with 11,500 sf of retail on the lower level located in Manhattan. The loan transferred to special servicing in May 2020 for imminent monetary default. The borrower had previously noted performance issues as a result of the coronavirus. The special servicer is still in the process of obtaining information before determining the next course of action.

Sixty Soho (3.6%) is the ninth largest loan in the pool. The loan is secured by a 97-key, full-service hotel located in the Soho neighborhood of Manhattan. The property operates as an independent boutique hotel. The loan is currently 90+ days delinquent having missed the April, May, June, and July payments. However, as of the July 2020 distribution date, the loan has not transferred to the special servicer. The borrower has notified the master servicer of coronavirus-related hardships. As of the December 2019 Smith Travel Research (STR) report, the property was operating with occupancy, ADR, and RevPAR penetration rates of 116.5%, 100%, and 116.5%, respectively.

Hyatt House Philadelphia/King of Prussia (3.2%) is the eleventh largest loan in the pool. The loan is secured by a 147-key limited service hotel located in King of Prussia, PA, approximately 20 miles southeast of Philadelphia. The property is across the street from the King of Prussia Mall, the second largest mall in the United States. The hotel's franchise agreement with Hyatt expires in 2033, seven years after the loan's maturity. At issuance it was noted there was a sizable amount of new supply coming online, however, a majority of the hotels were not considered direct competitors. As of the TTM period ending May 2020, the property was operating with occupancy, ADR, and RevPAR penetration rates of 117%, 111.6% and 130.7%, respectively.

Peachtree Mall (2.4%) is the thirteenth largest loan in the pool. The loan is secured by the 620,000-sf portion of an 822,000-sf regional mall located in Columbus, GA, approximately 100 miles southwest of Atlanta. The collateral anchors are Macy's, which has lease expiration in September 2022 and JC Penney, which recently renewed its lease for an additional five years through November 2024. Dillard's is a non-collateral anchor. The loan was designated as a FLOC due to declining performance, including lower tenant sales and near-term rollover risks. In-line tenant sales have declined to $350 psf at YE 2019 from $409 psf at issuance. As of March 2020, the collateral was 94.6% occupied and YE 2019 NOI DSCR was 1.69x.

The final FLOC in the top 15 is Hilton Head Village (2.2%). The loan is secured by a retail center located in Bluffton, SC, approximately five miles from the island of Hilton Head. The largest tenants at the property include Marshall's (27% of NRA, lease expires January 2022), Bed Bath & Beyond (22.3% of NRA, lease expires January 2021) and Old Navy (15.6% of NRA, lease expires July 2025). Rollover risk in 2022 is solely attributed to Bed Bath and Beyond; according to the special servicer the tenant plans on extending for five years. Negotiations remain ongoing. As of March 2020, the property was 98.3% occupied and the YE 2019 NOI DSCR was 1.37x.

The remaining FLOCs were flagged for expected performance declines given the increased pressure on property performance from the coronavirus pandemic. Three specially serviced loans (2.8%) are all secured by hotel properties and have all transferred between June and July 2020; all of the borrowers have cited performance issues related to the coronavirus. The special servicer continues to gather information and work through relief requests/workout strategies.

Limited Improvement in Credit Enhancement (CE): There have been limited increases in CE since Fitch's last rating action. As of the July 2020 distribution date, the pool's aggregate principal balance has been reduced by 2.75% to $736.3 million from $757.1 million at issuance. There are three loans (1.95%) that have fully defeased. There are 10 loans (52.5%) that are full term IO. There are 14 loans (13.9%) that are structured with a partial IO period, four of which are still in their IO periods. There have been no realized losses to date.

Alternative Loss Considerations: Fitch's analysis included an additional stressed scenario whereby a 25% loss was applied to the maturity balance of the Peachtree Mall loan. This additional sensitivity scenario took into consideration declining performance, declining tenant sales and the potential for an outsized loss on the loan. This scenario has no impact on the ratings or outlooks.

Coronavirus Exposure: Significant economic impact to certain hotels, retail, and multifamily properties have materialized as a result of reductions in travel and tourism, temporary property closures and lack of clarity on the potential duration of the pandemic. The pandemic has prompted the closure of several hotel properties in gateway cities as well as malls, entertainment venues, and individual stores. In the current pool, there are 18 loans (26.7%) that are secured by retail properties and nine loans (12.9%) that are secured by hotel properties. Fitch's base case analysis applied an additional NOI stress to nine retail loans (10%) and eight hotel loans (12.2%) that did not meet certain performance thresholds.

RATING SENSITIVITIES

The Negative Outlook on classes E, X-E, and F reflect the potential for downgrades given an increase in loss expectations driven by the heightened number of specially serviced loans and FLOCs. Additionally, property-level cash flow concerns, particularly for hotel and retail properties, as a result of the economic slowdown related to the coronavirus have also been factored into Fitch's analysis. Retail and lodging represent 26.7% and 12.9%, respectively. The Stable Rating Outlooks on classes A-1 through D reflect increasing CE, continued amortization and generally stable loss expectations, despite the increase in FLOCs.

Factors that Could, Individually or Collectively, Lead to a Positive Rating Action/Upgrade:

Sensitivity factors that lead to upgrades would include stable to improved asset performance coupled with paydown and/or defeasance. Upgrades to classes B and C would likely occur with significant improvement in CE and/or defeasance. However, adverse selection, increased concentrations or the underperformance of a particular loan(s) may limit the potential for future upgrades. An upgrade to class D is considered unlikely and would be limited based on the sensitivity to concentrations or the potential for future concentrations. Classes would not be upgraded above 'Asf' if there is a likelihood for interest shortfalls. Upgrades to classes E and F are not likely until the later years of the transaction, and only if the performance of the remaining pool is stable and/or properties vulnerable to the coronavirus return to pre-pandemic levels, and there is sufficient CE to the class.

Factors that Could, Individually or Collectively, Lead to a Negative Rating Action/Downgrade:

Sensitivity factors that lead to downgrades include an increase in pool level losses from underperforming or specially serviced loans. Downgrades to the senior A-1, A-2, A-3, A-4, A-SB and A-S classes, along with class B are not expected given the position in the capital structure and sufficient CE, but may occur if interest shortfalls occur or losses increase considerably. A downgrade to classes C and D may occur should several loans transfer to special servicing and/or as pool losses significantly increase. A downgrade to classes E and F is likely should the performance of the FLOCs fail to stabilize and/or as losses materialize and CE becomes eroded.

In addition to its baseline scenario, Fitch also envisions a downside scenario where the health crisis is prolonged beyond 2021; should this scenario play out, Fitch expects that a greater percentage of classes may be assigned a Negative Rating Outlook or those with Negative Rating Outlooks will be downgraded one or more categories.

For more information on Fitch's original rating sensitivity on the transaction, please refer to the new issuance report.

BEST/WORST CASE RATING SCENARIO

International scale credit ratings of Structured Finance transactions have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of seven notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of seven notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAAsf' to 'Dsf'. Best- and worst-case scenario credit ratings are based on historical performance. For more information about the methodology used to determine sector-specific best- and worst-case scenario credit ratings, visit https://www.fitchratings.com/site/re/10111579.

USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10

No third-party due diligence was provided or reviewed in relation to this rating action. Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING

The principal sources of information used in the analysis are described in the Applicable Criteria.

ESG CONSIDERATIONS

The highest level of ESG credit relevance, if present, is a score of 3. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity(ies), either due to their nature or to the way in which they are being managed by the entity(ies). For more information on Fitch's ESG Relevance Scores, visit www.fitchratings.com/esg.

Additional information is available on www.fitchratings.com

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