Fitch Ratings has affirmed five classes of DBCG 2017-BBG Mortgage Trust Commercial Mortgage Pass-Through Certificates.
RATING ACTIONS
Entity / Debt
Rating
Prior
DBCG 2017-BBG
A 233062AA6
LT
AAAsf
Affirmed
AAAsf
B 233062AG3
LT
AAAsf
Affirmed
AAAsf
C 233062AJ7
LT
AA+sf
Affirmed
AA+sf
HRR 233062AM0
LT
AAsf
Affirmed
AAsf
X-EXT 233062AE8
LT
AAAsf
Affirmed
AAAsf
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VIEW ADDITIONAL RATING DETAILS
KEY RATING DRIVERS
Sustained High Occupancy and Improved Cash Flow Since Issuance: The affirmations reflect improved cash flow and stable occupancy since issuance and stable performance since Fitch's last rating action. Property occupancy has remained near 100% at 99.2% as of
Fitch's stressed net cash flow (NCF) remains stable since Fitch's last rating action at approximately
The
High-Quality Asset in Strong Location: The collateral for the loan consists of class A office space within a larger mixed-use tower that has exceptional design and build quality and encompasses the entire city block along
Single Tenant Concentration: The property is 97.8% occupied by Bloomberg, which uses this location as its global headquarters. Bloomberg's lease runs through
Institutional Sponsorship: The property is 100% owned by
Full Interest Only: The loan requires interest-only payments for the entire three-year initial loan term, plus the extension periods. Despite downside risk associated with the lack of amortization against potential future value declines, the current loan basis of
The loan had an initial loan maturity in
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative rating action/downgrade:
Sustained and significant decline in asset occupancy and/or a material deterioration in property NCF. Due to the long-term nature of the primary tenant's lease, this scenario is not expected unless expenses grow significantly.
Factors that could, individually or collectively, lead to positive rating action/upgrade:
For classes B, C, HRR and X-EXT a sustained high occupancy and further improvements in cash flow and/or with a full defeasance of the loan.
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
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
Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. 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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