Fitch Ratings has downgraded four and affirmed 11 classes of Morgan Stanley Bank of America Merrill Lynch Trust (MSBAM) Mortgage Trust 2016-C28 commercial mortgage pass-through certificates.

RATING ACTIONS

ENTITY/DEBT	RATING		PRIOR

MSBAM 2016-C28

A-3 61766LBR9

LT	AAAsf 	Affirmed		AAAsf

A-4 61766LBS7

LT	AAAsf 	Affirmed		AAAsf

A-S 61766LBV0

LT	AAAsf 	Affirmed		AAAsf

A-SB 61766LBQ1

LT	AAAsf 	Affirmed		AAAsf

B 61766LBW8

LT	AA-sf 	Affirmed		AA-sf

C 61766LBX6

LT	A-sf 	Affirmed		A-sf

D 61766LAC3

LT	BBB-sf 	Affirmed		BBB-sf

E 61766LAJ8

LT	Bsf 	Downgrade		BB-sf

E-1 61766LAE9

LT	BBsf 	Affirmed		BBsf

E-2 61766LAG4

LT	Bsf 	Downgrade		BB-sf

EF 61766LAS8

LT	CCCsf 	Downgrade		B-sf

F 61766LAQ2

LT	CCCsf 	Downgrade		B-sf

X-A 61766LBT5

LT	AAAsf 	Affirmed		AAAsf

X-B 61766LBU2

LT	AAAsf 	Affirmed		AAAsf

X-D 61766LAA7

LT	BBB-sf 	Affirmed		BBB-sf

VIEW ADDITIONAL RATING DETAILS

The class E-1 and E-2 certificates may be exchanged for a related amount of class E certificates, and the class E certificates may be exchanged for a rateable portion of class E-1 and E-2 certificates. Additionally, a holder of class E-1, E-2, F-1 and F-2 certificates may exchange such classes of certificates (on an aggregate basis) for a related amount of class EF certificates, and a holder of class EF certificates may exchange that class EF for a rateable portion of each class of the class E-1, E-2, F-1 and F-2 certificates.

Fitch does not rate the class F-1, F-2, G-1, G-2, H-1, H-2, G, H, or EFG certificates. Classes A-1 and A-2 have paid in full.

KEY RATING DRIVERS

Increased Loss Expectations Driven by Fitch Loans of Concern: The downgrades reflect increased loss expectations for the pool due to an increasing number of Fitch Loans of Concern (FLOCs) and higher loss expectations since the prior rating action on the hotel and retail FLOCs that have been impacted by the slowdown in economic activity related to the coronavirus. Seventeen loans (35.8% of pool) were designated as FLOCs, which includes three loans (8.7%) that transferred to special servicing since April 2020. The average NOI for the 14 FLOCs reporting YE 2019 financials declined 6% from the prior year.

The largest increase in loss since the prior rating action is the University West Apartments loan (2.1%), which is secured by a 483-unit student housing property located in Ames, IA near Iowa State University. Cash flow has fallen significantly since issuance due to lower occupancy and increased operating expenses. The loan was assumed in December 2018 and the timing of the sale reportedly impacted property occupancy, as the primary leasing season occurs prior to September at the start of each new school year. YE 2019 NOI declined 33% from YE 2018 due to a 36% increase in total operating expenses (mostly utilities, repairs and maintenance and advertising and marketing expenses), as the new owner made improvements to the property. Rental concessions have also been offered at the property in an effort to improve occupancy. Occupancy rose to 84.7% as of June 2020 from 75.5% in June 2019 and 49.1% in March 2019, but remains below 97% reported at issuance. The servicer-reported YTD June 2020 NOI debt service coverage ratio (DSCR) was 0.98x, up slightly from 0.78x at YE 2019. The partial interest-only loan begins amortizing in December 2020. Enrollment at Iowa State University has also trended downward since issuance.

The fifth largest loan, Princeton South Corporate Center (5.5%), which had the next largest increase in loss since the prior rating action, was flagged for declining occupancy and cash flow, upcoming lease rollover and high submarket vacancy. The loan is secured by a 267,426-sf suburban office property located in Trenton, NJ that was 75.2% occupied as of June 2020, down from 79.3% in July 2019 and 80.9% in December 2018. The recent occupancy decline was due to four tenants totaling 6.1% of the NRA and 8% of total base rents vacating at or ahead of lease expiration in 2019; this was partially offset by leases with two smaller tenants totaling 2% of the NRA starting in September 2019 and February 2020. YE 2019 NOI fell 23% from YE 2018 due to lower rental income and higher operating expenses. The loan was recently returned from special servicing in July 2020, after it transferring in May 2020 for imminent monetary default due to coronavirus concerns. No forbearance was granted, as the loan's return to the master servicer was due to there being sufficient NOI to pay debt service. Upcoming lease rollover includes 1.8% of the NRA in 2020, 7.1% in 2021 and 16.4% in 2022; the 2022 rollover is mostly concentrated in the April 2022 expiration of largest tenant CA, Inc. (15.9% of NRA; 21% of total base rents). The property is also located in a high vacancy submarket, with 18.9% vacancy reported by REIS for the Trenton office submarket as of 2Q20.

The Greenville Mall loan (4.8%), which has the next largest increase in loss since the prior rating action, is secured by a 406,464-sf portion of a 448,471-sf regional mall operated by Brookfield located in Greenville, NC that has reported declining anchor and inline tenant sales since issuance. The mall is anchored by JCPenney (21.9% of collateral NRA; lease expiry in February 2024), Belk Ladies (22.1%; January 2025), Dunham's Sports (13.4%; January 2024) and Belk Men & Home (non-collateral). Comparable inline sales for tenants occupying less than 10,000 sf were $346 psf for TTM June 2020, down from $414 psf at YE 2019 and $404 psf at issuance. JCPenney reported estimated sales of $94 psf for TTM June 2020, unchanged from YE 2019 but down from $120 psf at YE 2016. Sales for Belk Ladies dropped to $86 psf for TTM June 2020 from $125 psf at YE 2019 and $179 psf at issuance. Sales for Dunham's Sports were $44 psf for TTM June 2020, compared with $38 psf at YE 2019 and $62 psf at issuance. Collateral occupancy is estimated to be approximately 91.8% after Pier 1 Imports (2.5%) closed in mid-2020. As a result of the pandemic, the mall closed in March 2020 and reopened in May with restricted hours. The servicer-reported YE 2019 NOI DSCR was 1.66x, compared with 1.60x at YE 2018.

The eighth largest loan in the pool, Marriott - Albuquerque, NM (4%), which is secured by a 411-room full-service hotel located in Albuquerque, NM, transferred to special servicing in April 2020 for imminent monetary default and was 30 days delinquent as of the October 2020 remittance reporting. The borrower requested coronavirus relief through the suspension of FF&E payments for nine months and a suspension of the cash management trigger until 3Q21; relief negotiations are ongoing. The borrower has continued to fund operating expense and debt service shortfalls. As of TTM July 2020, the hotel reported occupancy, ADR and RevPAR of 42.9%, $122.74 and $52.66, respectively, and was underperforming its competitive set in terms of occupancy and RevPAR, with respective penetration ratios of 85.7% and 90.9%; ADR penetration was 106%. Occupancy for the YTD July 2020 period was 26.3%.

The DoubleTree by Hilton - Cleveland, OH loan (3.1%), which is secured by a 379-room full-service hotel located in downtown Cleveland, OH, transferred to special servicing in October 2019 for imminent monetary default and was over 90 days delinquent as of the October 2020 remittance reporting. Property performance declined prior to the onset of the coronavirus pandemic due to lower occupancy and room rates from increased competition and several significant non-recurring local events that resulted in higher revenues during 2016. The hotel reported TTM August 2019 occupancy, ADR and RevPAR of 59.1%, $123 and $73, respectively, compared to 66.9%, $121 and $81 at the time of issuance. According to the special servicer, the coronavirus-related foreclosure moratorium for the subject's jurisdiction of Cuyahoga County, OH was lifted on Oct. 1, 2020 and the trust counsel is working through issues related to the union pension plan that must be resolved before foreclosure can be finalized.

The other FLOCs include two additional specially serviced hotel loans (Le Meridien Cambridge MIT and Holiday Inn - La Mesa, CA; combined 4.7%); a portfolio of two office properties flagged due to declining cash flow and a lack of leasing updates for two larger tenants (Solar Plaza & Sunbelt Professional Centre; 3.1%); and nine loans secured by retail and hotel properties (combined 8.5%) flagged for declining occupancy and/or cash flow, lack of leasing updates for expired tenants, coronavirus-related performance concerns, the occurrence of a servicing trigger event or delinquent financial statements.

Additional Stresses Applied due to Coronavirus Exposure: Loans secured by retail, hotel and multifamily properties represent 38.9% of the pool (16 loans), 15% (nine loans) and 9.9% (four loans), respectively. The multifamily exposure includes one loan (University West Apartments; 2.1%) secured by a student housing property, which is a FLOC. The retail loans have a weighted average (WA) NOI DSCR of 2.34x and can withstand an average 57.3% decline to NOI before DSCR falls below 1.00x. The hotel loans have a WA NOI DSCR of 1.87x and can withstand an average 46.4% decline to NOI before DSCR falls below 1.00x. The multifamily loans have a WA NOI DSCR of 1.47x and can withstand an average 31.9% decline to NOI before DSCR falls below 1.00x.

Fitch's base case analysis applied additional coronavirus-related stresses on eight retail loans (14.1%), six hotel loans (8.1%) and one multifamily loan (University West Apartments; 2.1%) to account for potential cash flow disruptions due to the coronavirus pandemic; these additional stresses contributed to the downgrade of classes E, F, E-2 and EF and the Negative Rating Outlooks on classes D, X-D, E, E-1 and E-2.

Alternative Loss Consideration: Fitch performed an additional sensitivity on the Greenville Mall loan (4.8%), which factored in a potential outsized loss of 50% on the current balance to reflect declining tenant sales, the tertiary market location and regional mall concerns due to the negative effects of the pandemic; this drove the Negative Outlook revision on classes D and X-D and further supports the Negative Outlook maintained on classes E, E-1 and E-2.

Increasing Credit Enhancement: Credit enhancement (CE) has increased since issuance due to continued amortization and the repayment of the GLP Industrial Portfolio A loan ($67.5 million) in October 2019, ahead of its scheduled November 2025 maturity date. As of the October 2020 distribution date, the pool's aggregate principal balance has paid down by 9.9% to $861 million from $956 million at issuance. The transaction is expected to pay down by 8.8% based on scheduled loan maturity balances. Five loans (21.9% of pool) are full-term, interest-only and eight loans (25.9%) are partial interest-only and have yet to begin amortizing, compared to 54.2% of the original pool at issuance. Two loans (1.6%) have been defeased.

RATING SENSITIVITIES

The Negative Rating Outlooks on classes D, X-D, E, E-1 and E-2 reflect the potential for downgrade due to concerns surrounding the ultimate impact of the coronavirus pandemic and the performance concerns associated with the FLOCs, which include four specially serviced loans. The Stable Rating Outlooks on classes A-3 through D reflect the overall stable performance of the remainder of the pool and expected continued amortization.

Factors that could, individually or collectively, lead to positive rating action/upgrade:

Sensitivity factors that could lead to upgrades would include stable to improved asset performance, particularly on the FLOCs, coupled with additional paydown and/or defeasance. Upgrades to classes B and C would only occur with significant improvement in CE and/or defeasance and with the stabilization of performance on the FLOCs. Upgrades to classes D and X-D would also consider these factors, but 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 of interest shortfalls. Upgrades to classes E, E-1 and E-2 are not likely until the later years in 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. Classes F and EF are unlikely to be upgraded absent significant performance improvement on the FLOCs and substantially higher recoveries than expected on the specially serviced loans/assets.

Factors that could, individually or collectively, lead to negative rating action/downgrade:

Sensitivity factors that lead to downgrades include an increase in pool-level losses from underperforming or specially serviced loans/assets. Downgrades to classes A-3, A-4, A-SB, A-S, B, X-A and X-B are not likely due to the position in the capital structure, but may occur should interest shortfalls affect these classes. A downgrade to class C is possible should expected losses for the pool increase significantly and/or should all of the loans susceptible to the coronavirus pandemic suffer losses. Downgrades to classes D, E, E-1 and E-2 are possible should an outsized loss occur on the Greenville Mall loan, performance of the FLOCs continue to decline and/or additional loans transfer to special servicing. Further downgrades to classes F and EF would occur as losses are realized and/or become more certain.

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, classes 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

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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