Kroll Bond Rating Agency (KBRA) affirms its outstanding ratings for all classes of GSMS 2013-PEMB, a $260.0 million, CMBS single borrower transaction.
The affirmations follow a surveillance review of the transaction, which has exhibited stable performance since securitization. KBRA maintains a KBRA Performance Outlook (KPO) of Perform on the loan.
The transaction collateral consists of a first lien mortgage loan secured by the borrower's fee simple interest in 678,818 sf of Pembroke Lakes Mall, a 1.1 million sf super-regional mall located in Pembroke Pines, Florida. At issuance, the mall included six anchor tenants totaling 781,275 sf, two of which, Macy's (181,847 sf) and Sears (143,372 sf), served as collateral for the loan. Sears recently closed it store in November 2019 and the space has been backfilled by AMC Theater and Round 1. Dillard's, Dillard's Men & Home, and JCPenney each own their stores, including the underlying land, and operate pursuant to reciprocal easement agreements that expire in 2032, seven years beyond the loan term. The Macy's Men & Home store is owned by Macy's, but the underlying land is ground leased from the borrower and serves as collateral for the loan. The loan sponsor is Brookfield Property Partners, LP.
The collateral was 95.0% leased as of July 2019, down from 99.4% at last review and 98.2% at securitization. However, based on the possible impending closure of Forever 21's 13,518-sf store, occupancy may decline to approximately 93.0%. For the trailing twelve-month (TTM) period ending June 2019, comparable in-line tenants occupying less than 10,000 sf generated sales of $557 per sf, down 2.6% from $572 per sf for the full year 2018 and up 5.3% from $529 per sf at securitization. The current sales performance is 8.6% above the International Council of Shopping Centers (ICSC) national average ($513 per sf) and 6.5% above the ICSC US South Regional sales ($523 per sf) as of the TTM period ending July 2018, the latest available.
KBRA analyzed the cash flow for the property utilizing information from the trustee and servicer to determine KBRA Net Cash Flow (KNCF). The analysis produced a KNCF of $25.7 million and a KBRA value of $331.6 million. The resulting in-trust KBRA Loan to Value (KLTV) is 78.4%, up from 76.0% at last review and in line with securitization (78.5%). All outstanding ratings have been affirmed, as the magnitude of the change in KBRA value and KLTV do not warrant rating actions at the time. For complete details on KBRA's analysis, please refer to the surveillance report, as well as links to the publications below.
To access ratings, reports and disclosures, click here.
Related Publications: (available at www.kbra.com)
- GSMS 2013-PEMB December 2019 Surveillance Report
- GSMS 2013-PEMB Pre-Sale Report
- U.S. CMBS Property Evaluation Methodology
- U.S. CMBS Single Borrower and Large Loan Rating Methodology
- Global Structured Finance Counterparty Methodology
Analytical Contacts:
Lisa Spaziano, Senior Director
(215) 882-5872
lspaziano@kbra.com
Greg Springrose, Associate
(215) 882-5936
gspringrose@kbra.com
Roy Chun, Managing Director
(646) 731-2376
rchun@kbra.com
Business Development Contact:
Michele Patterson, Managing Director
(646) 731-2397
mpatterson@kbra.com
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KBRA is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider, and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.
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