Class AMZ1 at BBB (low) (sf)
Class AMZ2 at BB (low) (sf)
Class AMZ3 at B (low) (sf)
Class V-AMZ at B (low) (sf)
All trends are Stable.
These certificates are currently also rated by DBRS Morningstar's affiliated rating agency,
On
The subject rating actions are the result of the application of the NA SASB Methodology in conjunction with the 'North American CMBS Surveillance Methodology,' as applicable. Qualitative adjustments were made to the final loan-to-value (LTV) sizing benchmarks used for this rating analysis.
Built in 2015, the Amazon Phase VII property is a 12-story Class A office building containing 318,617 square feet (sf) on a 0.68-acre site and is Leadership in Energy and Environmental Design Gold certified. The property includes 5,651 sf of ground-floor retail space, as well as a four-level subterranean parking garage containing 429 parking spaces, a public plaza, and a landscaped rooftop terrace with sweeping views of
The property is 98.2% occupied by
The Amazon Phase VII whole loan has an outstanding principal balance of
The loan is interest only for the entire term. The lack of principal amortization during the loan term increases refinance risk at maturity, and the DBRS Morningstar LTV is 95.4%, based on the senior loan, with the nonpooled rake certificates being subordinate to the senior pooled portion of the loan. The DBRS Morningstar LTV is 131.1%, inclusive of the subordinate note. The DBRS Morningstar opinion of the property's stabilized value is 39.0% lower than the appraised value, and factors in a substantial decline prior to applying our LTV rating thresholds.
The sponsors cashed out
In the analysis for these rating actions, the DBRS Morningstar net cash flow (NCF) figure of
The DBRS Morningstar NCF was re-analyzed for the subject rating action to confirm its consistency with the 'DBRS Morningstar North American Commercial Real Estate Property Analysis Criteria.' The NCF figure applied as part of the analysis represents a 0.4% variance from the Issuer's NCF.
The cap rate applied is at the lower end of the range of DBRS
DBRS Morningstar made positive qualitative adjustments to the final LTV sizing benchmarks used for this rating analysis, totaling 6.50% to account for cash flow volatility, property quality, and market fundamentals.
A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework and its methodologies can be found at: https://www.dbrsmorningstar.com/research/357792.
All ratings are subject to surveillance, which could result in ratings being upgraded, downgraded, placed under review, confirmed, or discontinued by DBRS Morningstar.
DBRS Morningstar provides updated analysis and in-depth commentary in the DBRS Viewpoint platform for this transaction.
For complimentary access to this content, please register for the DBRS Viewpoint platform at www.viewpoint.dbrsmorningstar.com. The platform includes loan-level data for most outstanding CMBS transactions (including non-DBRS Morningstar-rated), as well as loan-level and transaction-level commentary for most DBRS Morningstar-rated and -monitored transactions.
Notes:
All figures are in
The principal methodologies are the North American Single-Asset/Single-Borrower Ratings Methodology and North American CMBS Surveillance Methodology, which can be found on www.dbrsmorningstar.com under Methodologies & Criteria. For a list of the structured-finance-related methodologies that may be used during the rating process, please see the DBRS Morningstar Global Structured Finance Related Methodologies document, which can be found on www.dbrsmorningstar.com in the Commentary tab under Regulatory Affairs. Please note that not every related methodology listed under a principal structured finance asset class methodology may be used to rate or monitor an individual structured finance or debt obligation.
For more information regarding rating methodologies and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/357883.
For more information regarding structured finance rating methodologies and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/358308.
The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.
Please see the related appendix for additional information regarding the sensitivity of assumptions used in the rating process. Please note a sensitivity analysis is not performed for CMBS bonds rated CCC or lower. The DBRS Morningstar long-term rating scale definition indicates that ratings of CCC or lower are assigned when the bond is highly likely to default or default is imminent, thereby prevailing over a sensitivity analysis.
For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at info@dbrsmorningstar.com.
Tel. +1 212 806-3277
Ratings
Date Issued Debt Rated Action Rating Trend Issued
i
US =
CA = Canada Issued, NRSRO
EU = EU Issued, NRSRO
E = EU endorsed
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10-Jul-20 Commercial Mortgage Pass-Through Certificates, Series 2020-2PAC, Amazon Phase VII Loan Specific Certificates, Class AMZ1 New Rating BBB (low) (sf) Stb US
10-Jul-20 Commercial Mortgage Pass-Through Certificates, Series 2020-2PAC, Amazon Phase VII Loan Specific Certificates, Class AMZ2 New Rating BB (low) (sf) Stb US
10-Jul-20 Commercial Mortgage Pass-Through Certificates, Series 2020-2PAC, Amazon Phase VII Loan Specific Certificates, Class AMZ3 New Rating B (low) (sf) Stb US
10-Jul-20 Commercial Mortgage Pass-Through Certificates, Series 2020-2PAC, Amazon Phase VII Loan Specific Certificates, Class V-AMZ New Rating B (low) (sf) Stb US
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