FILED PURSUANT TO RULE 424(b)(5) | ||
REGISTRATION FILE NO.: 333-189017-09 | ||
Prospectus Supplement supplementing the Prospectus dated January 16, 2015
$666,096,000 (Approximate)
Citigroup Commercial Mortgage Trust 2015-GC31
as Issuing Entity
Citigroup Commercial Mortgage Securities Inc.
as Depositor
Citigroup Global Markets Realty Corp.
Goldman Sachs Mortgage Company
Rialto Mortgage Finance, LLC
RAIT Funding, LLC
KGS-Alpha Real Estate Capital Markets, LLC
as Sponsors
Commercial Mortgage Pass-Through Certificates, Series 2015-GC31
The Commercial Mortgage Pass-Through Certificates, Series 2015-GC31 will consist of multiple classes of certificates, including those identified on the table below which are offered pursuant to this prospectus supplement. The Series 2015-GC31 certificates will represent the beneficial ownership interests in the issuing entity, which will be Citigroup Commercial Mortgage Trust 2015-GC31. The issuing entity’s main assets will be a pool of 50 fixed rate mortgage loans secured by first liens on various types of commercial and multifamily properties.
Classes of Offered Certificates | Initial Certificate Principal Amount or Notional Amount(1) | Initial Pass-Through Rate(2) | Pass-Through Rate Description | Rated Final Distribution Date | ||||||
Class A-1 | $ | 28,330,000 | 1.637% | Fixed | June 2048 | |||||
Class A-2 | $ | 2,298,000 | 3.084% | Fixed | June 2048 | |||||
Class A-3 | $ | 160,000,000 | 3.497% | Fixed | June 2048 | |||||
Class A-4 | $ | 268,724,000 | 3.762% | Fixed | June 2048 | |||||
Class A-AB | $ | 46,974,000 | 3.431% | Fixed | June 2048 | |||||
Class X-A | $ | 565,089,000 | (5) | 0.604% | Variable IO(6) | June 2048 | ||||
Class A-S(7) | $ | 58,763,000 | (8) | 4.199% | WAC - 0.001%(9) | June 2048 | ||||
Class B(7) | $ | 42,871,000 | (8) | 4.200% | WAC(10) | June 2048 | ||||
Class PEZ(7) | $ | 135,486,000 | (8) | (12) | (12) | June 2048 | ||||
Class C(7) | $ | 33,852,000 | (8) | 4.200% | WAC(10) | June 2048 | ||||
Class D | $ | 24,284,000 | 4.200% | WAC(10) | June 2048 |
(Footnotes to table begin on page S-13)
You should carefully consider the risk factors beginning on page S-65 of this prospectus supplement and page 19 of the accompanying prospectus.
Neither the Series 2015-GC31 certificates nor the underlying mortgage loans are insured or guaranteed by any governmental agency or instrumentality or any other person or entity.
The Series 2015-GC31 certificates will represent interests in and obligations of the issuing entity and will not represent the obligations of the depositor, the sponsors or any of their affiliates. | THE SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES REGULATORS HAVE NOT APPROVED OR DISAPPROVED OF THE OFFERED CERTIFICATES OR DETERMINED IF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS ARE TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THE DEPOSITOR WILL NOT LIST THE OFFERED CERTIFICATES ON ANY SECURITIES EXCHANGE OR ANY AUTOMATED QUOTATION SYSTEM OF ANY NATIONAL SECURITIES ASSOCIATION.
Distributions to holders of the certificates of amounts to which they are entitled will be made monthly, commencing in August 2015. Credit enhancement will be provided by certain classes of subordinate certificates that will be subordinate to certain classes of senior certificates as described under “Description of the Offered Certificates—Subordination” in this prospectus supplement. |
The offered certificates will be offered by Citigroup Global Markets Inc., Goldman, Sachs & Co. and Drexel Hamilton, LLC when, as and if issued by the issuing entity, delivered to and accepted by the underwriters and subject to each underwriter’s right to reject orders in whole or in part. The underwriters will offer the offered certificates to prospective investors from time to time in negotiated transactions or otherwise at varying prices determined at the time of sale, plus, in certain cases, accrued interest, determined at the time of sale. The underwriters expect to deliver the offered certificates to purchasers in book-entry form only through the facilities of The Depository Trust Company in the United States and Clearstream Banking, société anonyme and Euroclear Bank SA/NV, as operator of the Euroclear System, in Europe against payment in New York, New York on or about July 8, 2015. Citigroup Commercial Mortgage Securities Inc. expects to receive from this offering approximately 103.9% of the aggregate principal balance of the offered certificates, plus accrued interest from July 1, 2015, before deducting expenses payable by the depositor.
The issuing entity will be relying on an exclusion or exemption from the definition of “investment company” under the Investment Company Act of 1940, as amended (the “Investment Company Act”), contained in Section 3(c)(5) of the Investment Company Act or Rule 3a-7 under the Investment Company Act, although there may be additional exclusions or exemptions available to the issuing entity. The issuing entity is being structured so as not to constitute a “covered fund” for purposes of the Volcker Rule under the Dodd-Frank Act (both as defined in“Risk Factors—Legal and Regulatory Provisions Affecting Investors Could Adversely Affect the Liquidity of the Offered Certificates” in this prospectus supplement). See also“Legal Investment” in this prospectus supplement.
Citigroup | Goldman, Sachs & Co. | |
Co-Lead Managers and Joint Bookrunners | ||
Drexel Hamilton | ||
Co-Manager | ||
June 24, 2015 |
TABLE OF CONTENTS
CERTIFICATE SUMMARY | S-13 | Risks Relating to Enforceability of Cross- | ||
SUMMARY | S-15 | Collateralization | S-81 | |
RISK FACTORS | S-65 | The Performance of a Mortgage Loan and | ||
The Offered Certificates May Not Be a | Its Related Mortgaged Property | |||
Suitable Investment for You | S-65 | Depends in Part on Who Controls the | ||
The Offered Certificates Are Limited | Borrower and Mortgaged Property | S-82 | ||
Obligations | S-65 | The Borrower’s Form of Entity May Cause | ||
The Volatile Economy, Credit Crisis and | Special Risks | S-82 | ||
Downturn in the Real Estate Market | A Bankruptcy Proceeding May Result in | |||
Have Adversely Affected and May | Losses and Delays in Realizing on the | |||
Continue to Adversely Affect the Value | Mortgage Loans | S-83 | ||
of CMBS | S-65 | Mortgage Loans Are Non-Recourse and Are | ||
External Factors May Adversely Affect the | Not Insured or Guaranteed | S-84 | ||
Value and Liquidity of Your Investment | S-66 | Adverse Environmental Conditions at or | ||
The Certificates May Have Limited Liquidity | Near Mortgaged Properties May Result | |||
and the Market Value of the Certificates | in Losses | S-84 | ||
May Decline | S-67 | Risks Related to Redevelopment, Expansion | ||
The Exchangeable Certificates Are Subject | and Renovation at Mortgaged | |||
to Additional Risks | S-68 | Properties | S-85 | |
Subordination of Exchangeable Certificates | S-68 | Risks Relating to Costs of Compliance with | ||
Limited Information Causes Uncertainty | S-69 | Applicable Laws and Regulations | S-85 | |
Legal and Regulatory Provisions Affecting | Litigation Regarding the Mortgaged | |||
Investors Could Adversely Affect the | Properties or Borrowers May Impair | |||
Liquidity of the Offered Certificates | S-69 | Your Distributions | S-85 | |
Your Yield May Be Affected by Defaults, | Other Financings or Ability to Incur Other | |||
Prepayments and Other Factors | S-71 | Financings Entails Risk | S-86 | |
Nationally Recognized Statistical Rating | Risks of Anticipated Repayment Date Loans | S-87 | ||
Organizations May Assign Different | A Borrower May Be Unable to Repay Its | |||
Ratings to the Certificates; Ratings of | Remaining Principal Balance on the | |||
the Certificates Reflect Only the Views | Maturity Date or Anticipated Repayment | |||
of the Applicable Rating Agencies as of | Date; Longer Amortization Schedules | |||
the Dates Such Ratings Were Issued; | and Interest-Only Provisions Increase | |||
Ratings May Affect ERISA Eligibility; | Risk | S-87 | ||
Ratings May Be Downgraded | S-74 | Risks Relating to Interest on Advances and | ||
Commercial and Multifamily Lending Is | Special Servicing Compensation | S-89 | ||
Dependent on Net Operating Income | S-75 | Increases in Real Estate Taxes May Reduce | ||
Underwritten Net Cash Flow Could Be | Available Funds | S-89 | ||
Based on Incorrect or Failed | Some Mortgaged Properties May Not Be | |||
Assumptions | S-76 | Readily Convertible to Alternative Uses | S-89 | |
The Mortgage Loans Have Not Been | Risks Related to Zoning Non-Compliance | |||
Reunderwritten by Us; Some Mortgage | and Use Restrictions | S-90 | ||
Loans May Not Have Complied with | Risks Relating to Inspections of Properties | S-91 | ||
Another Originator’s Underwriting | Earthquake, Flood and Other Insurance May | |||
Criteria | S-76 | Not Be Available or Adequate | S-91 | |
Static Pool Data Would Not Be Indicative of | Terrorism Insurance May Not Be Available | |||
the Performance of This Pool | S-77 | for All Mortgaged Properties | S-92 | |
Appraisals May Not Reflect Current or | Risks Associated with Blanket Insurance | |||
Future Market Value of Each Property | S-77 | Policies or Self-Insurance | S-93 | |
Performance of the Certificates Will Be | State and Local Mortgage Recording Taxes | |||
Highly Dependent on the Performance | May Apply Upon a Foreclosure or Deed- | |||
of Tenants and Tenant Leases | S-78 | in-Lieu of Foreclosure and Reduce Net | ||
Concentrations Based on Property Type, | Proceeds | S-93 | ||
Geography, Related Borrowers and | The Mortgage Loan Sellers, the Sponsors | |||
Other Factors May Disproportionately | and the Depositor Are Subject to | |||
Increase Losses | S-80 | Bankruptcy or Insolvency Laws That |
S-3 |
May Affect the Issuing Entity’s | Insurance Considerations | S-148 | ||
Ownership of the Mortgage Loans | S-93 | Zoning and Use Restrictions | S-148 | |
Interests and Incentives of the Originators, | Appraised Value | S-149 | ||
the Sponsors and Their Affiliates May | Non-Recourse Carveout Limitations | S-150 | ||
Not Be Aligned with Your Interests | S-94 | Real Estate and Other Tax Considerations | S-150 | |
Interests and Incentives of the Underwriter | Certain Terms of the Mortgage Loans | S-151 | ||
Entities May Not Be Aligned with Your | The Loan Combinations | S-160 | ||
Interests | S-96 | Significant Obligor | S-173 | |
Potential Conflicts of Interest of the Master | Representations and Warranties | S-173 | ||
Servicer, the Special Servicer, the | Sale of Mortgage Loans; Mortgage File | |||
Trustee, any Outside Servicer and any | Delivery | S-174 | ||
Outside Special Servicer | S-97 | Cures, Repurchases and Substitutions | S-175 | |
Potential Conflicts of Interest of the | Additional Information | S-178 | ||
Operating Advisor | S-98 | TRANSACTION PARTIES | S-179 | |
Potential Conflicts of Interest of a Directing | The Sponsors | S-179 | ||
Holder, any Outside Controlling Class | Compensation of the Sponsors | S-192 | ||
Representative and any Companion | The Depositor | S-192 | ||
Loan Holder | S-99 | The Originators | S-193 | |
Potential Conflicts of Interest in the | The Issuing Entity | S-211 | ||
Selection of the Underlying Mortgage | The Trustee | S-212 | ||
Loans | S-100 | The Certificate Administrator | S-214 | |
Conflicts of Interest May Occur as a Result | Trustee and Certificate Administrator Fee | S-217 | ||
of the Rights of the Controlling Class | The Operating Advisor | S-217 | ||
Representative, an Outside Controlling | Servicers | S-218 | ||
Class Representative or a Controlling | Servicing Compensation, Operating Advisor | |||
Note Holder to Terminate the Special | Compensation and Payment of | |||
Servicer of the Related Loan | Expenses | S-226 | ||
Combination | S-101 | Certain Affiliations and Certain Relationships | S-238 | |
Other Potential Conflicts of Interest May | DESCRIPTION OF THE OFFERED | |||
Affect Your Investment | S-101 | CERTIFICATES | S-241 | |
Your Lack of Control Over the Issuing Entity | General | S-241 | ||
and Servicing of the Mortgage Loans | Exchangeable Certificates | S-244 | ||
Can Create Risks | S-102 | Distributions | S-245 | |
Rights of the Directing Holder and the | Subordination | S-259 | ||
Operating Advisor Could Adversely | Appraisal Reduction Amounts | S-260 | ||
Affect Your Investment | S-104 | Voting Rights | S-264 | |
Loan Combinations Pose Special Risks | S-104 | Delivery, Form, Transfer and Denomination | . S-265 | |
Sponsors May Not Be Able to Make | Certificateholder Communication | S-268 | ||
Required Repurchases or Substitutions | YIELD, PREPAYMENT AND MATURITY | |||
of Defective Mortgage Loans | S-107 | CONSIDERATIONS | S-269 | |
Book-Entry Registration Will Mean You Will | Yield | S-269 | ||
Not Be Recognized as a Holder of | Yield on the Class X-A Certificates | S-272 | ||
Record | S-107 | Weighted Average Life of the Offered | ||
Tax Matters and Changes in Tax Law May | Certificates | S-272 | ||
Adversely Impact the Mortgage Loans | Price/Yield Tables | S-277 | ||
or Your Investment | S-107 | THE POOLING AND SERVICING | ||
Combination or “Layering” of Multiple Risks | AGREEMENT | S-281 | ||
May Significantly Increase Risk of Loss | S-108 | General | S-281 | |
DESCRIPTION OF THE MORTGAGE POOL | S-109 | Certain Considerations Regarding the | ||
General | S-109 | Outside Serviced Loan Combinations | S-281 | |
Certain Calculations and Definitions | S-113 | Assignment of the Mortgage Loans | S-282 | |
Statistical Characteristics of the Mortgage | Servicing of the Mortgage Loans | S-282 | ||
Loans | S-120 | Advances | S-287 | |
Environmental Considerations | S-132 | Accounts | S-291 | |
Litigation Considerations | S-135 | Application of Penalty Charges and | ||
Redevelopment, Expansion and Renovation | S-135 | Modification Fees | S-292 | |
Default History, Bankruptcy Issues and | Withdrawals from the Collection Account | S-293 | ||
Other Proceedings | S-136 | Enforcement of “Due-On-Sale” and “Due- | ||
Tenant Issues | S-138 | On-Encumbrance” Clauses | S-294 |
S-4 |
Inspections | S-296 | ERISA CONSIDERATIONS | S-346 | |
Evidence as to Compliance | S-296 | Exempt Plans | S-349 | |
Certain Matters Regarding the Depositor, | Further Warnings | S-349 | ||
the Master Servicer, the Special | LEGAL INVESTMENT | S-350 | ||
Servicer and the Operating Advisor | S-297 | CERTAIN LEGAL ASPECTS OF THE | ||
Servicer Termination Events | S-299 | MORTGAGE LOANS | S-352 | |
Rights Upon Servicer Termination Event | S-300 | RATINGS | S-353 | |
Waivers of Servicer Termination Events | S-302 | PLAN OF DISTRIBUTION (UNDERWRITER | ||
Termination of the Special Servicer | S-302 | CONFLICTS OF INTEREST) | S-355 | |
Amendment | S-304 | LEGAL MATTERS | S-356 | |
Realization Upon Mortgage Loans | S-306 | INDEX OF CERTAIN DEFINED TERMS | S-357 | |
Directing Holder | S-314 | |||
Operating Advisor | S-320 | ANNEX A – STATISTICAL | ||
Asset Status Reports | S-326 | CHARACTERISTICS OF THE | ||
Rating Agency Confirmations | S-327 | MORTGAGE LOANS | A-1 | |
Termination; Retirement of Certificates | S-329 | ANNEX B – STRUCTURAL AND | ||
Optional Termination; Optional Mortgage | COLLATERAL TERM SHEET | B-1 | ||
Loan Purchase | S-329 | ANNEX C – MORTGAGE POOL | ||
Reports to Certificateholders; Available | INFORMATION | C-1 | ||
Information | S-330 | ANNEX D – FORM OF DISTRIBUTION | ||
Servicing of the Outside Serviced Mortgage | DATE STATEMENT | D-1 | ||
Loans | S-336 | ANNEX E-1 – SPONSOR | ||
USE OF PROCEEDS | S-341 | REPRESENTATIONS AND | ||
MATERIAL FEDERAL INCOME TAX | WARRANTIES | E-1-1 | ||
CONSEQUENCES | S-342 | ANNEX E-2 – EXCEPTIONS TO SPONSOR | ||
General | S-342 | REPRESENTATIONS AND | ||
Tax Status of Offered Certificates | S-343 | WARRANTIES | E-2-1 | |
Taxation of the Offered Regular Certificates | ANNEX F – CLASS A-AB SCHEDULED | |||
and the Trust Components | S-343 | PRINCIPAL BALANCE SCHEDULE | F-1 | |
Taxation of the Exchangeable Certificates | S-345 | ANNEX G – ST. ANTHONY’S HEALTHPLEX | ||
Further Information | S-345 | NORTH MORTGAGE LOAN | ||
STATE AND OTHER TAX | AMORTIZATION SCHEDULE | G-1 | ||
CONSIDERATIONS | S-346 |
S-5 |
IMPORTANT NOTICE ABOUT INFORMATION PRESENTED IN THIS
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS
Information about the offered certificates is contained in two separate documents that progressively provide more detail: (a) the accompanying prospectus, which provides general information, some of which may not apply to the offered certificates; and (b) this prospectus supplement, which describes the specific terms of the offered certificates.The terms of the offered certificates contained in this prospectus supplement, including the annexes to this prospectus supplement, are intended to supplement the terms contained in the accompanying prospectus.
We have filed with the Securities and Exchange Commission a registration statement under the Securities Act of 1933, as amended, with respect to the offered certificates. However, this prospectus supplement does not contain all of the information contained in our registration statement, nor does it contain all information that is required to be included in a prospectus required to be filed as part of a registration statement. For further information regarding the documents referred to in this prospectus supplement, you should refer to our registration statement and the exhibits to it. Our registration statement and the exhibits to it can be inspected and copied at prescribed rates at the public reference facilities maintained by the Securities and Exchange Commission at its Public Reference Room, 100 F Street, N.E., Washington, D.C. 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. You may obtain information on the operation of the Public Reference Room by calling the Securities and Exchange Commission at 1-800-SEC-0330. Copies of this prospectus supplement can also be obtained electronically through the Securities and Exchange Commission’s internet website (http://www.sec.gov).
You should rely only on the information contained in this prospectus supplement and the accompanying prospectus. We have not authorized anyone to provide you with information that is different from that contained in this prospectus supplement and the prospectus. The information contained in this prospectus supplement is accurate only as of the date of this prospectus supplement.
· This prospectus supplement begins with two introductory sections describing the Series 2015-GC31 certificates and the issuing entity in abbreviated form:
· | the “Certificate Summary” commencing on page S-13 of this prospectus supplement, which sets forth important statistical information relating to the Series 2015-GC31 certificates; and |
· | the “Summary” commencing on page S-15 of this prospectus supplement, which gives a brief introduction to the key features of the Series 2015-GC31 certificates and a description of the underlying mortgage loans. |
Additionally, “Risk Factors” commencing on page S-65 of this prospectus supplement, describes the material risks that apply to the Series 2015-GC31 certificates which are in addition to those described in the prospectus with respect to the securities issued by the issuing entity generally.
This prospectus supplement includes cross-references to other sections in this prospectus supplement and to sections in the accompanying prospectus where you can find further related discussions. The Table of Contents in this prospectus supplement and the prospectus identify the pages where these sections are located.
Certain capitalized terms are defined and used in this prospectus supplement and the accompanying prospectus to assist you in understanding the terms of the offered certificates and this offering. The capitalized terms used in this prospectus supplement are defined on the pages indicated under the caption “Index of Certain Defined Terms” commencing on page S-357 of this prospectus supplement. The capitalized terms used in the prospectus are defined on the pages indicated under the caption “Glossary” commencing on page 200 of the prospectus.
· In this prospectus supplement:
· | the terms “depositor,” “we,” “us” and “our” refer to Citigroup Commercial Mortgage Securities Inc. |
· | references to “lender” with respect to the mortgage loans generally should be construed to mean, from and after the date of initial issuance of the offered certificates, the trustee on behalf of the issuing entity as the holder of record title to the mortgage loans or the master servicer or the special |
S-6 |
servicer, as applicable, with respect to the obligations and rights of the lender as described under “The Pooling and Servicing Agreement” in this prospectus supplement. |
The Annexes attached to this prospectus supplement are incorporated into and made a part of this prospectus supplement.
THERE IS CURRENTLY NO SECONDARY MARKET FOR THE OFFERED CERTIFICATES. WE CANNOT ASSURE YOU THAT A SECONDARY MARKET WILL DEVELOP OR, IF A SECONDARY MARKET DOES DEVELOP, THAT IT WILL PROVIDE HOLDERS OF THE OFFERED CERTIFICATES WITH LIQUIDITY OF INVESTMENT OR THAT IT WILL CONTINUE FOR THE TERM OF THE OFFERED CERTIFICATES. THE UNDERWRITERS CURRENTLY INTEND TO MAKE A MARKET IN THE OFFERED CERTIFICATES, BUT ARE UNDER NO OBLIGATION TO DO SO. ACCORDINGLY, PURCHASERS MUST BE PREPARED TO BEAR THE RISKS OF THEIR INVESTMENTS FOR AN INDEFINITE PERIOD. SEE “RISK FACTORS—THE CERTIFICATES MAY HAVE LIMITED LIQUIDITY AND THE MARKET VALUE OF THE CERTIFICATES MAY DECLINE” IN THIS PROSPECTUS SUPPLEMENT.
THIS PROSPECTUS SUPPLEMENT IS NOT AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY STATE OR OTHER JURISDICTION WHERE SUCH OFFER, SOLICITATION OR SALE IS NOT PERMITTED.
THE OFFERED CERTIFICATES DO NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE DEPOSITOR, THE SPONSORS, THE ORIGINATORS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE CERTIFICATE ADMINISTRATOR, THE OPERATING ADVISOR, THE CONTROLLING CLASS REPRESENTATIVE, THE COMPANION LOAN HOLDERS (OR THEIR REPRESENTATIVES), THE UNDERWRITERS OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THE OFFERED CERTIFICATES NOR THE MORTGAGE LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY OR PRIVATE INSURER.
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“YIELD, PREPAYMENT AND MATURITY CONSIDERATIONS—YIELD ON THE CLASS X-A CERTIFICATES” IN THIS PROSPECTUS SUPPLEMENT.
S-7 |
UNITED KINGDOM
EACH UNDERWRITER HAS REPRESENTED AND AGREED THAT:
(A) IN THE UNITED KINGDOM, IT HAS ONLY COMMUNICATED OR CAUSED TO BE COMMUNICATED AND WILL ONLY COMMUNICATE OR CAUSE TO BE COMMUNICATED AN INVITATION OR INDUCEMENT TO ENGAGE IN INVESTMENT ACTIVITY (WITHIN THE MEANING OF SECTION 21 OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (THE “FSMA”)) RECEIVED BY IT IN CONNECTION WITH THE ISSUE OR SALE OF THE OFFERED CERTIFICATES IN CIRCUMSTANCES IN WHICH SECTION 21(1) OF THE FSMA DOES NOT APPLY TO THE DEPOSITOR OR THE ISSUING ENTITY; AND
(B) IT HAS COMPLIED AND WILL COMPLY WITH ALL APPLICABLE PROVISIONS OF THE FSMA WITH RESPECT TO ANYTHING DONE BY IT IN RELATION TO THE OFFERED CERTIFICATES IN, FROM OR OTHERWISE INVOLVING THE UNITED KINGDOM.
NOTICE TO UNITED KINGDOM INVESTORS
THE ISSUING ENTITY MAY CONSTITUTE A “COLLECTIVE INVESTMENT SCHEME” AS DEFINED BY SECTION 235 OF THE FSMA THAT IS NOT A “RECOGNIZED COLLECTIVE INVESTMENT SCHEME” FOR THE PURPOSES OF THE FSMA AND THAT HAS NOT BEEN AUTHORIZED, REGULATED OR OTHERWISE RECOGNIZED OR APPROVED. AS AN UNREGULATED SCHEME, THE OFFERED CERTIFICATES CANNOT BE MARKETED IN THE UNITED KINGDOM TO THE GENERAL PUBLIC, EXCEPT IN ACCORDANCE WITH THE FSMA.
THE DISTRIBUTION OF THIS PROSPECTUS SUPPLEMENT (A) IF MADE BY A PERSON WHO IS NOT AN AUTHORIZED PERSON UNDER THE FSMA, IS BEING MADE ONLY TO, OR DIRECTED ONLY AT, PERSONS WHO (I) ARE OUTSIDE THE UNITED KINGDOM, OR (II) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND QUALIFY AS INVESTMENT PROFESSIONALS IN ACCORDANCE WITH ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE “FINANCIAL PROMOTION ORDER”), OR (III) ARE PERSONS FALLING WITHIN ARTICLE 49(2)(A) THROUGH (D) (“HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.”) OF THE FINANCIAL PROMOTION ORDER (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS “FPO PERSONS”); AND (B) IF MADE BY A PERSON WHO IS AN AUTHORIZED PERSON UNDER THE FSMA, IS BEING MADE ONLY TO, OR DIRECTED ONLY AT, PERSONS WHO (I) ARE OUTSIDE THE UNITED KINGDOM, OR (II) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND QUALIFY AS INVESTMENT PROFESSIONALS IN ACCORDANCE WITH ARTICLE 14(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (PROMOTION OF COLLECTIVE INVESTMENT SCHEMES) (EXEMPTIONS) ORDER 2001 (THE “PROMOTION OF COLLECTIVE INVESTMENT SCHEMES EXEMPTIONS ORDER”), OR (III) ARE PERSONS FALLING WITHIN ARTICLE 22(2)(A) THROUGH (D) (“HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.”) OF THE PROMOTION OF COLLECTIVE INVESTMENT SCHEMES EXEMPTIONS ORDER, OR (IV) PERSONS TO WHOM THE ISSUING ENTITY MAY LAWFULLY BE PROMOTED IN ACCORDANCE WITH RULE 4.12 OF THE UK FINANCIAL CONDUCT AUTHORITY’S CONDUCT OF BUSINESS SOURCEBOOK (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS “PCIS PERSONS” AND, TOGETHER WITH THE FPO PERSONS, THE “RELEVANT PERSONS”).
THIS PROSPECTUS SUPPLEMENT MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS PROSPECTUS SUPPLEMENT RELATES, INCLUDING THE OFFERED CERTIFICATES, IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. ANY PERSONS OTHER THAN RELEVANT PERSONS SHOULD NOT ACT OR RELY ON THIS PROSPECTUS SUPPLEMENT.
POTENTIAL INVESTORS IN THE UNITED KINGDOM ARE ADVISED THAT ALL, OR MOST, OF THE PROTECTIONS AFFORDED BY THE UNITED KINGDOM REGULATORY SYSTEM WILL NOT APPLY TO AN INVESTMENT IN THE OFFERED CERTIFICATES AND THAT COMPENSATION WILL NOT BE AVAILABLE UNDER THE UNITED KINGDOM FINANCIAL SERVICES COMPENSATION SCHEME.
S-8 |
EUROPEAN ECONOMIC AREA
THIS PROSPECTUS SUPPLEMENT HAS BEEN PREPARED ON THE BASIS THAT ANY OFFER OF OFFERED CERTIFICATES IN ANY MEMBER STATE OF THE EUROPEAN ECONOMIC AREA WHICH HAS IMPLEMENTED THE PROSPECTUS DIRECTIVE (EACH, A “RELEVANT MEMBER STATE”) WILL BE MADE PURSUANT TO AN EXEMPTION UNDER THE PROSPECTUS DIRECTIVE (AS DEFINED BELOW) FROM THE REQUIREMENT TO PUBLISH A PROSPECTUS FOR OFFERS OFcertificates. ACCORDINGLY ANY PERSON MAKING OR INTENDING TO MAKE AN OFFER IN THAT RELEVANT MEMBER STATE OF CERTIFICATES WHICH ARE THE SUBJECT OF AN OFFERING CONTEMPLATED IN THIS PROSPECTUS SUPPLEMENT AS COMPLETED BY FINAL TERMS IN RELATION TO THE OFFER OF THOSE OFFERED CERTIFICATES MAY ONLY DO SO IN CIRCUMSTANCES IN WHICH NO OBLIGATION ARISES FOR THE ISSUING ENTITY, THE DEPOSITOR OR AN UNDERWRITER TO PUBLISH A PROSPECTUS PURSUANT TO ARTICLE 3 OF THE PROSPECTUS DIRECTIVE IN RELATION TO SUCH OFFER.
NONE OF THE ISSUING ENTITY, THE DEPOSITOR OR ANY OF THE UNDERWRITERS HAS AUTHORIZED, NOR DOES ANY OF THEM AUTHORIZE, THE MAKING OF ANY OFFER OF OFFERED CERTIFICATES IN CIRCUMSTANCES IN WHICH AN OBLIGATION ARISES FOR THE ISSUING ENTITY, THE DEPOSITOR OR AN UNDERWRITER TO PUBLISH OR SUPPLEMENT A PROSPECTUS FOR SUCH OFFER.
FOR THE PURPOSES OF THIS PROVISION AND THE PROVISION IMMEDIATELY BELOW, THE EXPRESSION “PROSPECTUS DIRECTIVE” MEANS DIRECTIVE 2003/71/EC (AND AMENDMENTS THERETO, INCLUDING THE 2010 PD AMENDING DIRECTIVE, TO THE EXTENT IMPLEMENTED IN THE RELEVANT MEMBER STATE), AND INCLUDES ANY RELEVANT IMPLEMENTING MEASURE IN THE RELEVANT MEMBER STATE, AND THE EXPRESSION “2010 PD AMENDING DIRECTIVE” MEANS DIRECTIVE 2010/73/EU.
EUROPEAN ECONOMIC AREA SELLING RESTRICTIONS
IN RELATION TO EACH RELEVANT MEMBER STATE, EACH UNDERWRITER HAS REPRESENTED AND AGREED THAT,with effect from and including the date on which the prospectus directive is implemented in that relevant member state, IT HAS NOT MADE AND WILL NOT MAKE AN OFFER OF THE CERTIFICATES WHICH ARE THE SUBJECT OF THE OFFERING CONTEMPLATED BY THIS PROSPECTUS SUPPLEMENT TO THE PUBLIC IN THAT RELEVANT MEMBER STATE OTHER THAN:
(A) TO ANY LEGAL ENTITY WHICH IS A “QUALIFIED INVESTOR” AS DEFINED IN THE PROSPECTUS DIRECTIVE;
(B) TO FEWER THAN 150 NATURAL OR LEGAL PERSONS (OTHER THAN “QUALIFIED INVESTORS” AS DEFINED IN THE PROSPECTUS DIRECTIVE) SUBJECT TO OBTAINING THE PRIOR CONSENT OF THE RELEVANT UNDERWRITER OR UNDERWRITERS NOMINATED BY THE ISSUING ENTITY FOR ANY SUCH OFFER; OR
(C) IN ANY OTHER CIRCUMSTANCES FALLING WITHIN ARTICLE 3(2) OF THE PROSPECTUS DIRECTIVE;
PROVIDEDTHAT NO SUCH OFFER OF THE OFFERED CERTIFICATES REFERRED TO IN CLAUSES (A), (B) AND (C) ABOVE SHALL REQUIRE THE DEPOSITOR, THE ISSUING ENTITY OR ANY UNDERWRITER TO PUBLISH A PROSPECTUS PURSUANT TO ARTICLE 3 OF THE PROSPECTUS DIRECTIVE.
FOR THE PURPOSES OF THE PRIOR PARAGRAPH, THE EXPRESSION AN “OFFER OF THE CERTIFICATES WHICH ARE THE SUBJECT OF THE OFFERING CONTEMPLATED BY THIS PROSPECTUS SUPPLEMENT TO THE PUBLIC” IN RELATION TO ANY CERTIFICATE THAT IS OFFERED IN ANY RELEVANT MEMBER STATE MEANS THE COMMUNICATION IN ANY FORMand by any means of SUFFICIENT INFORMATION ON THE TERMS OF THE OFFER AND THE CERTIFICATES TO BE OFFERED SO AS TO ENABLE AN INVESTOR TOdecideTO PURCHASE OR SUBSCRIBE TO THE OFFERED CERTIFICATES, AS THE SAME MAY BE VARIED IN THAT RELEVANT MEMBER STATE BY ANY MEASURE IMPLEMENTING THE PROSPECTUS DIRECTIVE IN THAT RELEVANT MEMBER STATE.
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HONG KONG
NO PERSON HAS ISSUED OR HAD IN ITS POSSESSION FOR THE PURPOSES OF ISSUE, OR WILL ISSUE OR HAVE IN ITS POSSESSION FOR THE PURPOSES OF ISSUE, WHETHER IN HONG KONG OR ELSEWHERE, ANY ADVERTISEMENT, INVITATION OR DOCUMENT RELATING TO THE OFFERED CERTIFICATES, WHICH IS DIRECTED AT, OR THE CONTENTS OF WHICH ARE LIKELY TO BE ACCESSED OR READ BY, THE PUBLIC OF HONG KONG (EXCEPT IF PERMITTED TO DO SO UNDER THE LAWS OF HONG KONG) OTHER THAN WITH RESPECT TO OFFERED CERTIFICATES WHICH ARE OR ARE INTENDED TO BE DISPOSED OF ONLY TO PERSONS OUTSIDE HONG KONG OR ONLY TO “PROFESSIONAL INVESTORS” WITHIN THE MEANING OF THE SECURITIES AND FUTURES ORDINANCE (CAP. 571 OF THE LAWS OF HONG KONG) AND ANY RULES OR REGULATIONS MADE UNDER THAT ORDINANCE.
THE OFFERED CERTIFICATES (IF THEY ARE NOT A “STRUCTURED PRODUCT” AS DEFINED IN THE SECURITIES AND FUTURES ORDINANCE (CAP. 571 OF THE LAWS OF HONG KONG) HAVE NOT BEEN OFFERED OR SOLD AND WILL NOT BE OFFERED OR SOLD, BY MEANS OF ANY DOCUMENT, OTHER THAN (A) TO “PROFESSIONAL INVESTORS” AS DEFINED IN THE SECURITIES AND FUTURES ORDINANCE (CAP. 571 OF THE LAWS OF HONG KONG) AND ANY RULES OR REGULATIONS MADE UNDER THAT ORDINANCE, OR (B) IN OTHER CIRCUMSTANCES WHICH DO NOT RESULT IN THE DOCUMENT CONSTITUTING A “PROSPECTUS” AS DEFINED IN THE COMPANIES (WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE (CAP. 32 OF THE LAWS OF HONG KONG) OR WHICH DO NOT CONSTITUTE AN OFFER TO THE PUBLIC WITHIN THE MEANING OF THE COMPANIES ORDINANCE (CAP. 622 OF THE LAWS OF HONG KONG). FURTHER, THE CONTENTS OF THIS PROSPECTUS SUPPLEMENT HAVE NOT BEEN REVIEWED OR APPROVED BY THE SECURITIES AND FUTURES COMMISSION OF HONG KONG OR ANY OTHER REGULATORY AUTHORITY IN HONG KONG. YOU ARE ADVISED TO EXERCISE CAUTION IN RELATION TO THE OFFERING CONTEMPLATED IN THIS PROSPECTUS SUPPLEMENT. IF YOU ARE IN ANY DOUBT ABOUT ANY OF THE CONTENTS OF THIS PROSPECTUS SUPPLEMENT, YOU SHOULD OBTAIN INDEPENDENT PROFESSIONAL ADVICE.
SINGAPORE
NEITHER THIS PROSPECTUS SUPPLEMENT NOR ANY OTHER DOCUMENT OR MATERIAL IN CONNECTION WITH ANY OFFER OF THE OFFERED CERTIFICATES HAS BEEN REGISTERED AS A PROSPECTUS WITH THE MONETARY AUTHORITY OF SINGAPORE (“MAS”) UNDER THE SECURITIES AND FUTURES ACT (CAP. 289) OF SINGAPORE (THE “SFA”). ACCORDINGLY, MAS ASSUMES NO RESPONSIBILITY FOR THE CONTENTS OF THIS PROSPECTUS SUPPLEMENT. THIS PROSPECTUS SUPPLEMENT IS NOT A PROSPECTUS AS DEFINED IN THE SFA AND STATUTORY LIABILITY UNDER THE SFA IN RELATION TO THE CONTENTS OF PROSPECTUSES WOULD NOT APPLY. THE PROSPECTIVE INVESTORS SHOULD CONSIDER CAREFULLY WHETHER THE INVESTMENT IS SUITABLE FOR IT.
THIS PROSPECTUS SUPPLEMENT AND ANY OTHER DOCUMENT OR MATERIAL IN CONNECTION WITH THE OFFER OR SALE, OR INVITATION FOR SUBSCRIPTION OR PURCHASE, OF THE OFFERED CERTIFICATES MAY NOT BE CIRCULATED OR DISTRIBUTED, NOR MAY THE OFFERED CERTIFICATES BE OFFERED OR SOLD, OR BE MADE THE SUBJECT OF AN INVITATION FOR SUBSCRIPTION OR PURCHASE, WHETHER DIRECTLY OR INDIRECTLY, TO PERSONS IN SINGAPORE OTHER THAN (I) TO AN INSTITUTIONAL INVESTOR (AS DEFINED IN SECTION 4A OF THE SFA (“INSTITUTIONAL INVESTOR”)) UNDER SECTION 274 OF THE SFA, (II) TO A RELEVANT PERSON (AS DEFINED IN SECTION 275(2) OF THE SFA (“RELEVANT PERSON”)) PURSUANT TO SECTION 275(2) OF THE SFA, AND IN ACCORDANCE WITH THE CONDITIONS SPECIFIED IN SECTION 275 OF THE SFA; (III) TO ANY PERSON PURSUANT TO SECTION 275(1A) OF THE SFA, IN ACCORDANCE WITH THE CONDITIONS SPECIFIED IN SECTION 275 OF THE SFA; OR (IV) OTHERWISE PURSUANT TO, AND IN ACCORDANCE WITH THE CONDITIONS OF, ANY OTHER APPLICABLE PROVISION OF THE SFA.
UNLESS ANY OFFER OF SUCH OFFERED CERTIFICATES WAS PREVIOUSLY MADE IN OR ACCOMPANIED BY A PROSPECTUS AND WHICH ARE OF THE SAME CLASS AS OTHER OFFERED CERTIFICATES OF A CORPORATION LISTED ON FOR QUOTATION ON A SECURITIES EXCHANGE, ANY SUBSEQUENT OFFERS IN SINGAPORE OF OFFERED CERTIFICATES ACQUIRED PURSUANT TO AN INITIAL OFFER MADE IN RELIANCE ON AN EXEMPTION UNDER SECTION 274 OF THE SFA OR SECTION 275 OF THE SFA MAY ONLY BE MADE, PURSUANT TO THE REQUIREMENTS OF SECTION 276 OF THE SFA, FOR THE INITIAL SIX MONTH PERIOD AFTER SUCH ACQUISITION, TO PERSONS WHO ARE
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INSTITUTIONAL INVESTORS OR TO ACCREDITED INVESTORS (AS DEFINED IN SECTION 4A OF THE SFA (“ACCREDITED INVESTOR”)) OR RELEVANT PERSONS OR TO SUCH PERSONS PURSUANT TO AN OFFER REFERRED TO UNDER SECTION 275(1A) OF THE SFA. ANY TRANSFER AFTER SUCH INITIAL SIX MONTH PERIOD IN SINGAPORE SHALL BE MADE, PURSUANT TO THE REQUIREMENTS OF SECTION 257 OF THE SFA, IN RELIANCE ON ANY APPLICABLE EXEMPTION UNDER SUBDIVISION (4) OF DIVISION 1 OF PART XIII OF THE SFA (OTHER THAN SECTION 280 OF THE SFA).
IN ADDITION TO THE ABOVE, WHERE THE OFFERED CERTIFICATES ARE SUBSCRIBED OR PURCHASED UNDER SECTION 275 OF THE SFA BY A RELEVANT PERSON WHICH IS:
(A) | A CORPORATION (WHICH IS NOT AN ACCREDITED INVESTOR THE SOLE BUSINESS OF WHICH IS TO HOLD INVESTMENTS AND THE ENTIRE SHARE CAPITAL OF WHICH IS OWNED BY ONE OR MORE INDIVIDUALS, EACH OF WHOM IS AN ACCREDITED INVESTOR; OR |
(B) | A TRUST (WHERE THE TRUSTEE IS NOT AN ACCREDITED INVESTOR) WHOSE SOLE PURPOSE IS TO HOLD INVESTMENTS AND EACH BENEFICIARY IS AN ACCREDITED INVESTOR, |
SECURITIES (AS DEFINED IN SECTION 239(1) OF THE SFA) OF THAT CORPORATION OR THE BENEFICIARIES’ RIGHTS AND INTEREST (HOWSOEVER DESCRIBED) IN THAT TRUST SHALL NOT BE TRANSFERABLE FOR SIX MONTHS AFTER THAT CORPORATION OR THAT TRUST HAS ACQUIRED THE OFFERED CERTIFICATES UNDER SECTION 275 OF THE SFA EXCEPT:
(1) | TO AN INSTITUTIONAL INVESTOR UNDER SECTION 274 OF THE SFA OR TO A RELEVANT PERSON, OR TO ANY PERSON ARISING FROM AN OFFER REFERRED TO IN SECTION 275(1A) OR SECTION 276(4)(i)(B) OF THE SFA; |
(2) | WHERE NO CONSIDERATION IS GIVEN FOR THE TRANSFER; OR |
(3) | WHERE THE TRANSFER IS BY OPERATION OF LAW. |
JAPAN
THE OFFERED CERTIFICATES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE FINANCIAL INSTRUMENTS AND EXCHANGE LAW OF JAPAN, AS AMENDED (THE “FIEL”), AND DISCLOSURE UNDER THE FIEL HAS NOT BEEN AND WILL NOT BE MADE WITH RESPECT TO THE OFFERED CERTIFICATES. ACCORDINGLY, EACH UNDERWRITER HAS REPRESENTED AND AGREED THAT IT HAS NOT, DIRECTLY OR INDIRECTLY, OFFERED OR SOLD AND WILL NOT, DIRECTLY OR INDIRECTLY, OFFER OR SELL ANY CERTIFICATES IN JAPAN OR TO, OR FOR THE BENEFIT OF, ANY RESIDENT OF JAPAN (WHICH TERM AS USED IN THIS PROSPECTUS SUPPLEMENT MEANS ANY PERSON RESIDENT IN JAPAN, INCLUDING ANY CORPORATION OR OTHER ENTITY ORGANIZED UNDER THE LAWS OF JAPAN) OR TO OTHERS FOR RE-OFFERING OR RE-SALE, DIRECTLY OR INDIRECTLY, IN JAPAN OR TO, OR FOR THE BENEFIT OF, ANY RESIDENT OF JAPAN EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF, AND OTHERWISE IN COMPLIANCE WITH, THE FIEL AND OTHER RELEVANT LAWS, REGULATIONS AND MINISTERIAL GUIDELINES OF JAPAN.
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FORWARD-LOOKING STATEMENTS
In this prospectus supplement and the prospectus, we use certain forward-looking statements. These forward-looking statements are found in the material, including each of the tables, set forth under “Risk Factors” and “Yield, Prepayment and Maturity Considerations” in this prospectus supplement. Forward-looking statements are also found elsewhere in this prospectus supplement and prospectus and include words like “expects,” “intends,” “anticipates,” “estimates” and other similar words. These statements are intended to convey our projections or expectations as of the date of this prospectus supplement. These statements are inherently subject to a variety of risks and uncertainties. Actual results could differ materially from those we anticipate due to changes in, among other things:
· | economic conditions and industry competition, |
· | political and/or social conditions, and |
· | the law and government regulatory initiatives. |
We will not update or revise any forward-looking statement to reflect changes in our expectations or changes in the conditions or circumstances on which these statements were originally based.
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CERTIFICATE SUMMARY
Set forth below are the indicated characteristics of the respective classes of the Series 2015-GC31 certificates.
Classes of Certificates | Initial Certificate Principal Amount or Notional Amount(1) | Approximate Initial Credit Support | Initial Pass-Through Rate(2) | Pass-Through Rate Description | Expected Weighted Avg. Life (yrs.)(3) | Expected Principal Window(3) | |||||||||
Offered Certificates | |||||||||||||||
Class A-1 | $ | 28,330,000 | 30.000% | (4) | 1.637% | Fixed | 2.86 | 8/15 – 7/20 | |||||||
Class A-2 | $ | 2,298,000 | 30.000% | (4) | 3.084% | Fixed | 6.84 | 5/22 – 5/22 | |||||||
Class A-3 | $ | 160,000,000 | 30.000% | (4) | 3.497% | Fixed | 9.78 | 2/25 – 5/25 | |||||||
Class A-4 | $ | 268,724,000 | 30.000% | (4) | 3.762% | Fixed | 9.86 | 5/25 – 6/25 | |||||||
Class A-AB | $ | 46,974,000 | 30.000% | (4) | 3.431% | Fixed | 7.35 | 7/20 – 2/25 | |||||||
Class X-A | $ | 565,089,000 | (5) | N/A | 0.604% | Variable IO(6) | N/A | N/A | |||||||
Class A-S(7) | $ | 58,763,000 | (8) | 21.876% | 4.199% | WAC - 0.001%(9) | 9.92 | 6/25 – 6/25 | |||||||
Class B(7) | $ | 42,871,000 | (8) | 15.949% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | |||||||
Class PEZ(7) | $ | 135,486,000 | (8) | 11.269% | (11) | (12) | (12) | 9.92 | 6/25 – 6/25 | ||||||
Class C(7) | $ | 33,852,000 | (8) | 11.269% | (11) | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||
Class D | $ | 24,284,000 | 7.912% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||||
Non-Offered Certificates | |||||||||||||||
Class E | $ | 11,000,000 | 6.391% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||||
Class F | $ | 14,864,000 | 4.336% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||||
Class G | $ | 12,231,000 | 2.645% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||||
Class H | $ | 19,132,869 | 0.000% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||||
Class S(13) | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||
Class R(14) | N/A | N/A | N/A | N/A | N/A | N/A |
(1) | Approximate, subject to a variance ofplus orminus 5%. |
(2) | Approximate per annum rate as of the closing date. |
(3) | Determined assuming no prepayments prior to the maturity date or any anticipated repayment date, as applicable, for each mortgage loan and based on the modeling assumptions described under “Yield, Prepayment and Maturity Considerations” in this prospectus supplement. |
(4) | The credit support percentages set forth for the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates are represented in the aggregate. |
(5) | The Class X-A certificates will not have certificate principal amounts and will not be entitled to receive distributions of principal. Interest will accrue on the Class X-A certificates at the applicable pass-through rate based upon the related notional amount. The notional amount of the Class X-A certificates will be equal to the aggregate of the certificate principal amounts of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S trust component from time to time. |
(6) | The pass-through rate on the Class X-A certificates will generally be a per annum rate equal to the excess, if any, of (i) the weighted average of the net interest rates on the mortgage loans (in each case adjusted, if necessary, to accrue on the basis of a 360-day year consisting of twelve 30-day months), over (ii) the weighted average of the pass-through rates of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S trust component, as described in this prospectus supplement. |
(7) | The Class A-S, Class B and Class C certificates, in the applicable proportions, may be exchanged for Class PEZ certificates, and Class PEZ certificates may be exchanged for the applicable proportions of Class A-S, Class B and Class C certificates. The Class A-S, Class B, Class PEZ and Class C certificates are collectively referred to in this prospectus supplement as “exchangeable certificates.” |
(8) | On the closing date, the issuing entity will issue the Class A-S, Class B and Class C trust components, which will have initial outstanding principal balances, subject to a variance ofplus orminus 5%, of $58,763,000, $42,871,000 and $33,852,000, respectively. The exchangeable certificates will, at all times, represent undivided beneficial ownership interests in a grantor trust that will hold such trust components. Each class of the exchangeable certificates will, at all times, represent a beneficial interest in a percentage of the outstanding principal balance of the Class A-S, Class B and/or Class C trust components. Following any exchange of Class A-S, Class B and Class C certificates for Class PEZ certificates or any exchange of Class PEZ certificates for Class A-S, Class B and Class C certificates, the percentage interest of the outstanding principal balances of the Class A-S, Class B and Class C trust components that is represented by the Class A-S, Class B, Class PEZ and Class C certificates will be increased or decreased accordingly. The initial certificate principal amount of each class of the Class A-S, Class B and Class C certificates shown in the table on the cover page of this prospectus supplement, in the table above and on the back cover of this prospectus supplement represents the maximum certificate principal amount of such class without giving effect to any issuance of Class PEZ certificates. The initial certificate principal amount of the Class PEZ certificates shown in the table on the cover page of this prospectus supplement, in the table above and on the back cover of this prospectus supplement is equal to the aggregate of the maximum initial certificate principal amounts of the Class A-S, Class B and Class C certificates, representing the maximum certificate principal amount of the Class PEZ certificates that could be issued in an exchange. The actual certificate principal amount of any class of exchangeable certificates issued on the closing date may be less than the maximum certificate principal amount of that class and may be zero. The certificate principal amounts of the Class A-S, Class B and Class C certificates to be issued on the closing date will be reduced, in required proportions, by an amount equal to the certificate principal amount of the Class PEZ certificates issued on the closing date. The aggregate certificate principal amount of the offered certificates shown on the cover page and back page of this prospectus supplement includes the maximum certificate principal amount of exchangeable certificates that could be outstanding on the closing date, equal to $135,486,000 (subject to a variance ofplusorminus5%). |
(9) | For any distribution date, the pass-through rate on the Class A-S certificates will be a per annum rate equal to the weighted average of the net interest rates on the mortgage loans (in each case, adjusted, if necessary, to accrue on the basis of a 360-day year consisting of twelve 30-day months) as of their respective due dates in the month preceding the month in which the related distribution date occurs, less 0.001%. |
(10) | For any distribution date, the pass-through rate on each class of the Class B, Class C, Class D, Class E, Class F, Class G and Class H certificates will be a per annum rate equal to the weighted average of the net interest rates on the mortgage loans (in each case, adjusted, if |
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necessary, to accrue on the basis of a 360-day year consisting of twelve 30-day months) as of their respective due dates in the month preceding the month in which the related distribution date occurs. |
(11) | The initial subordination levels for the Class C and Class PEZ certificates are equal to the subordination level of the underlying Class C trust component. |
(12) | The Class PEZ certificates will not have a pass-through rate, but will be entitled to receive the sum of the interest distributable on the percentage interests of the Class A-S, Class B and Class C trust components represented by the Class PEZ certificates. The pass-through rates on the Class A-S, Class B and Class C trust components will at all times be the same as the pass-through rates on the Class A-S, Class B and Class C certificates, respectively. |
(13) | The Class S certificates will not have a certificate principal amount, notional amount, pass-through rate, rating or rated final distribution date. The Class S certificates will only be entitled to distributions of excess interest accrued on the mortgage loans with an anticipated repayment date. See “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—ARD Loans” in this prospectus supplement. |
(14) | The Class R certificates will not have a certificate principal amount, notional amount, pass-through rate, rating or rated final distribution date. The Class R certificates will represent the residual interests in each of two separate REMICs, as further described in this prospectus supplement. The Class R certificates will not be entitled to distributions of principal or interest. |
The Class E, Class F, Class G, Class H, Class S and Class R certificates are not offered by this prospectus supplement.
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Summary | ||||
The following is only a summary. Detailed information appears elsewhere in this prospectus supplement and in the accompanying prospectus. That information includes, among other things, detailed mortgage loan information and calculations of cash flows on the offered certificates. To understand all of the terms of the offered certificates, read carefully this entire document and the accompanying prospectus. See“Index of Certain Defined Terms” in this prospectus supplement and“Glossary” in the prospectus for definitions of capitalized terms. | ||||
General | ||||
Title of the Certificates | The certificates to be issued are known as the Citigroup Commercial Mortgage Trust 2015-GC31, Commercial Mortgage Pass-Through Certificates, Series 2015-GC31. | |||
Mortgage Loans | The certificates will be backed by 50 fixed rate mortgage loans with an aggregate outstanding principal balance as of the cut-off date of $723,323,870. The mortgage loans are secured by first liens on various types of commercial and multifamily properties. | |||
Transaction Overview | On the closing date, each sponsor will sell its respective mortgage loans to the depositor, which will in turn deposit them into a common law trust created on the closing date. That common law trust, which will be the issuing entity, will be formed pursuant to a pooling and servicing agreement, to be dated as of July 1, 2015, among the depositor, the master servicer, the special servicer, the operating advisor, the certificate administrator and the trustee. Subject to the discussion under “—Transaction Parties—Companion Loan Holders and Other Parties Related to Loan Combinations” below, the master servicer and, if and when necessary, the special servicer will each service the mortgage loans for which it is responsible in accordance with the pooling and servicing agreement and provide information to the certificate administrator as necessary for the certificate administrator to calculate distributions and other information regarding the certificates. | |||
The transfers of the mortgage loans from the sponsors to the depositor in exchange for cash and from the depositor to the issuing entity in exchange for the certificates, as well as the sales of the offered certificates by the depositor to the underwriters and by the underwriters to investors that purchase from them, are illustrated below: | ||||
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Transaction Parties | |||||
Issuing Entity | Citigroup Commercial Mortgage Trust 2015-GC31, a New York common law trust to be established on the closing date of this securitization transaction under the pooling and servicing agreement, dated as of July 1, 2015, between the depositor, the master servicer, the special servicer, the trustee, the certificate administrator and the operating advisor. See “Transaction Parties—The Issuing Entity” in this prospectus supplement. | ||||
Depositor | Citigroup Commercial Mortgage Securities Inc., a Delaware corporation. As depositor, Citigroup Commercial Mortgage Securities Inc. will acquire the mortgage loans from the sponsors and transfer them to the issuing entity. The depositor’s address is 388 Greenwich Street, New York, New York 10013 and its telephone number is (212) 816-6000. See “Transaction Parties—The Depositor” in this prospectus supplement and “Transaction Participants—The Depositor” in the prospectus. | ||||
Sponsors | The mortgage loans will be sold to the depositor by the following sponsors, which have organized and initiated the transaction in which the certificates will be issued: | ||||
· | Citigroup Global Markets Realty Corp., a New York corporation (41.4% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date); | ||||
· | Goldman Sachs Mortgage Company, a New York limited partnership (35.4% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date); | ||||
· | Rialto Mortgage Finance, LLC, a Delaware limited liability company (12.6% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date); | ||||
· | RAIT Funding, LLC, a Delaware limited liability company (7.7% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date); and | ||||
· | KGS-Alpha Real Estate Capital Markets, LLC, a Delaware limited liability company (2.9% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date). | ||||
See “Transaction Parties—The Sponsors” in this prospectus supplement. | |||||
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Originators | The mortgage loans were originated by the entities set forth in the following chart: | ||||||||||||
Originator | Sponsor | Number of Mortgage Loans | % of Initial Pool Balance | ||||||||||
Citigroup Global Markets Realty Corp. | Citigroup Global Markets Realty Corp. | 22 | 41.4 | % | |||||||||
Goldman Sachs Mortgage Company | Goldman Sachs Mortgage Company | 7 | 31.9 | ||||||||||
Rialto Mortgage Finance, LLC | Rialto Mortgage Finance, LLC | 9 | 12.6 | ||||||||||
RAIT Funding, LLC | RAIT Funding, LLC | 6 | 7.7 | ||||||||||
GS Commercial Real Estate LP | Goldman Sachs Mortgage Company | 3 | 3.5 | ||||||||||
KGS-Alpha Real Estate Capital Markets, LLC | KGS-Alpha Real Estate Capital Markets, LLC | 3 | 2.9 | ||||||||||
Total | 50 | 100.0 | % | ||||||||||
See “Transaction Parties—The Originators” in this prospectus supplement. | |||||||||||||
Companion Loan Holders and Other Parties Related to Loan Combinations | As described under “The Trust Fund—Mortgage Loans—Loan Combinations” in the accompanying prospectus, any of the mortgage loans held by the issuing entity may be part of a split loan structure referred to in this prospectus supplement as a “loan combination”. A loan combination consists of the particular mortgage loan to be included in the issuing entity (a “split mortgage loan”) and one or more “companion loans” that will be held outside the issuing entity. Any holder of a related companion loan would constitute a “companion loan holder”. The subject mortgage loan and its related companion loan(s) comprising any particular loan combination are: (i) each evidenced by one or more separate promissory notes; (ii) obligations of the same borrower(s); (iii) cross-defaulted; and (iv) collectively secured by the same mortgage(s) and/or deed(s) of trust encumbering the related mortgaged property or portfolio of mortgaged properties. A companion loan may bepari passu in right of payment with, or subordinate in right of payment to, the related split mortgage loan. In connection therewith: |
· | If a companion loan ispari passu in right of payment with the related split mortgage loan, then such companion loan would constitute a “pari passu companion loan” and the related loan combination would constitute a “pari passu loan combination”. | |||||||||||
· | If a companion loan is subordinate in right of payment to the related split mortgage loan, then such companion loan would constitute a “subordinate companion loan” and the related loan combination would constitute an “AB loan combination”. | |||||||||||
· | If a loan combination includes both a pari passu companion loan and a subordinate companion loan, the discussions in this prospectus supplement regarding both pari passu loan combinations and AB loan combinations will apply to such loan combination. | |||||||||||
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In the case of any loan combination, the allocation of payments to the subject mortgage loan and its related companion loan(s), whether on a senior/subordinated or apari passu basis (or some combination thereof), is generally effected through a co-lender agreement, intercreditor agreement, agreement among noteholders or comparable agreement to which the respective holders of the subject promissory notes are parties (any such agreement being referred to in this prospectus supplement as a “co-lender agreement”). That co-lender agreement will govern the relative rights and obligations of such holders and, in connection therewith, will provide that one of those holders will be the “controlling note holder” entitled (directly or through a representative) to (i) approve or direct material servicing decisions involving the related loan combination (while the remaining such holder(s) generally are only entitled to non-binding consultation rights in such regard) and (ii) in some cases, replace the special servicer with respect to the related loan combination with or without cause. In addition, that co-lender agreement will designate whether servicing of the related loan combination is to be governed by the pooling and servicing agreement for this securitization or the pooling and servicing agreement, trust and servicing agreement or other comparable agreement for a securitization involving a related companion loan or portion thereof. In connection therewith: | |||||
· | If a loan combination is serviced under the pooling and servicing agreement, trust and servicing agreement or other comparable agreement for a securitization involving a related companion loan or portion thereof (such agreement, an “outside servicing agreement”), then such loan combination would constitute an “outside serviced loan combination”, the related mortgage loan would constitute an “outside serviced mortgage loan” and any related companion loan would constitute an “outside serviced companion loan”. | ||||
· | If a pari passu loan combination is serviced under the pooling and servicing agreement for this securitization transaction, then such pari passu loan combination would constitute a “serviced loan combination” or a “serviced pari passu loan combination”, any related pari passu companion loan would constitute a “serviced companion loan” or a “serviced pari passu companion loan” and any holder of a related pari passu companion loan would constitute a “serviced companion loan holder” or a “serviced pari passu companion loan holder”. | ||||
· | If an AB loan combination is serviced under the pooling and servicing agreement for this securitization transaction, then such AB loan combination would constitute a “serviced loan combination” or a “serviced AB loan combination”, the related subordinate companion loan would constitute a “serviced companion loan” or a “serviced subordinate companion loan” and any holder of the related subordinate companion loan would constitute a “serviced companion loan holder” or a “serviced subordinate companion loan holder”. | ||||
· | If and for so long as the “controlling note” with respect to any serviced loan combination (regardless of whether such note evidences a pari passu companion loan or a subordinate companion loan) is not included in this securitization transaction, then such serviced loan combination would constitute a “serviced outside controlled loan combination”, the related mortgage loan would constitute a “serviced outside controlled mortgage loan” and the related serviced companion loan would constitute a “serviced outside controlled companion loan”. However, a serviced outside controlled | ||||
S-18 |
loan combination may cease to be such if, by virtue of any trigger event contemplated by the related co-lender agreement, the promissory note evidencing the related split mortgage loan becomes the controlling note for such loan combination, in which case the discussion in this prospectus supplement regarding “serviced outside controlled loan combinations” will thereafter cease to apply to the subject loan combination. | |||||
· | With respect to any loan combination that is, and only for so long as such loan combination is, a serviced outside controlled loan combination, the “outside controlling note holder” will at any time be the holder of the related controlling note (regardless of whether such note evidences a pari passu companion loan or a subordinate companion loan) or such holder’s designated representative. If, with respect to any serviced outside controlled loan combination, the related controlling note is included in a securitization trust, the pooling and servicing agreement, trust and servicing agreement or other comparable agreement for the relevant securitization will likely designate a particular party associated with that securitization, which may be, among others, a “controlling class representative” (or equivalent party), the majority holder of a particular class, a servicer or another service provider, to exercise the rights associated with the related controlling note, although the right of any such designated party to exercise some or all of such rights may terminate or shift to another designated party upon the occurrence of certain trigger events. | ||||
Each of the following mortgage loans to be held by the issuing entity is part of a loan combination: | |||||
· | the mortgage loan secured by the portfolio of mortgaged properties identified on Annex A to this prospectus supplement as Selig Office Portfolio, which mortgage loan represents approximately 9.95% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date; | ||||
· | the mortgage loan secured by the mortgaged property identified on Annex A to this prospectus supplement as Dallas Market Center, which mortgage loan represents approximately 9.9% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date; and | ||||
· | the mortgage loan secured by the mortgaged property identified on Annex A to this prospectus supplement as Crowne Plaza Bloomington, which mortgage loan represents approximately 1.7% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date. | ||||
The following characteristics apply to the Selig Office Portfolio loan combination: | |||||
· | The Selig Office Portfolio loan combination currently includes three companion loans, which are pari passu in right of payment with the Selig Office Portfolio mortgage loan. | ||||
· | The Selig Office Portfolio companion loan that is evidenced by the controlling note A-1 was contributed by Goldman Sachs Mortgage Company into the commercial mortgage securitization transaction | ||||
S-19 |
(the “CGCMT 2015-GC29 securitization”) involving the issuance of the Citigroup Commercial Mortgage Trust 2015-GC29, Commercial Mortgage Pass-Through Certificates, Series 2015-GC29 (the “CGCMT 2015-GC29 certificates”). | |||||
· | The Selig Office Portfolio companion loan that is evidenced by the non-controlling note A-2 was contributed by Goldman Sachs Mortgage Company into the commercial mortgage securitization transaction (the “GSMS 2015-GC30 securitization”) involving the issuance of the GS Mortgage Securities Trust 2015-GC30, Commercial Mortgage Pass-Through Certificates, Series 2015-GC30 (the “GSMS 2015-GC30 certificates”). | ||||
· | The Selig Office Portfolio companion loan that is evidenced by the non-controlling note A-4 is currently held by Goldman Sachs Mortgage Company and is expected to be contributed to one or more future commercial mortgage securitization transactions. | ||||
· | The Selig Office Portfolio loan combination is an outside serviced loan combination that is being serviced under the pooling and servicing agreement for the CGCMT 2015-GC29 securitization (the “CGCMT 2015-GC29 pooling and servicing agreement”) by the master servicer for the CGCMT 2015-GC29 securitization and, if and to the extent necessary, will be specially serviced by the special servicer for the CGCMT 2015-GC29 securitization. | ||||
· | The controlling note holder for the Selig Office Portfolio loan combination (which is the holder of the controlling note A-1 included in the CGCMT 2015-GC29 securitization) is the trustee for the CGCMT 2015-GC29 securitization on behalf of the holders of the CGCMT 2015-GC29 certificates. In accordance with the CGCMT 2015-GC29 pooling and servicing agreement, the rights of the holder of such companion loan will be exercised by the controlling class representative for the CGCMT 2015-GC29 securitization (the “CGCMT 2015-GC29 controlling class representative” and also an “outside controlling class representative”) or another party designated under the CGCMT 2015-GC29 pooling and servicing agreement. | ||||
See “—CGCMT 2015-GC29 Servicer, Special Servicer, Trustee and Custodian” below and “Description of the Mortgage Pool—The Loan Combinations—The Selig Office Portfolio Loan Combination” in this prospectus supplement. | |||||
The following characteristics apply to the Dallas Market Center loan combination: | |||||
· | The Dallas Market Center loan combination includes two companion loans, which arepari passuin right of payment with the Dallas Market Center mortgage loan. | ||||
· | The Dallas Market Center companion loan, which is evidenced by the controlling note A-1, was contributed by Goldman Sachs Mortgage Company into the GSMS 2015-GC30 securitization. | ||||
· | The Dallas Market Center companion loan that is evidenced by the non-controlling note A-3 is currently held by Goldman Sachs | ||||
S-20 |
Mortgage Company and is expected to be contributed to one or more future commercial mortgage securitization transactions. | |||||
· | The Dallas Market Center loan combination is an outside serviced loan combination that is being serviced under the pooling and servicing agreement for the GSMS 2015-GC30 securitization (the “GSMS 2015-GC30 pooling and servicing agreement”) by the master servicer for the GSMS 2015-GC30 securitization and, if and to the extent necessary, will be specially serviced by the special servicer for the GSMS 2015-GC30 securitization. | ||||
· | The controlling note holder for the Dallas Market Center loan combination (which is the holder of the controlling note A-1 included in the GSMS 2015-GC30 securitization) is the trustee for the GSMS 2015-GC30 securitization on behalf of the holders of the GSMS 2015-GC30 certificates. In accordance with the GSMS 2015-GC30 pooling and servicing agreement, the rights of the holder of such companion loan will be exercised by the controlling class representative for the GSMS 2015-GC30 securitization (the “GSMS 2015-GC30 controlling class representative” and also an “outside controlling class representative”) or another party designated under the GSMS 2015-GC30 pooling and servicing agreement. | ||||
See “—GSMS 2015-GC30 Servicer, Special Servicer, Trustee and Custodian” below and “Description of the Mortgage Pool—The Loan Combinations—The Dallas Market Center Loan Combination” in this prospectus supplement. | |||||
The following characteristics apply to the Crowne Plaza Bloomington loan combination: | |||||
· | The Crowne Plaza Bloomington loan combination includes one companion loan, which is pari passu in right of payment with the Crowne Plaza Bloomington mortgage loan. | ||||
· | The Crowne Plaza Bloomington companion loan, which is evidenced by the controlling note A-1, was contributed by Citigroup Global Markets Realty Corp. to the CGCMT 2015-GC29 securitization. | ||||
· | The Crowne Plaza Bloomington loan combination is an outside serviced loan combination that is being serviced under the CGCMT 2015-GC29 pooling and servicing agreement by the master servicer for the CGCMT 2015-GC29 securitization and, if and to the extent necessary, will be specially serviced by the special servicer for the CGCMT 2015-GC29 securitization. | ||||
· | The controlling note holder for the Crowne Plaza Bloomington loan combination (which is the holder of the controlling note A-1 included in the CGCMT 2015-GC29 securitization) is the trustee for the CGCMT 2015-GC29 securitization on behalf of the holders of the CGCMT 2015-GC29 certificates. In accordance with the CGCMT 2015-GC29 pooling and servicing agreement, the rights of the holder of such companion loan will be exercised by the CGCMT 2015-GC29 controlling class representative or another party designated under the CGCMT 2015-GC29 pooling and servicing agreement. | ||||
See “—CGCMT 2015-GC29 Servicer, Special Servicer, Trustee and Custodian” below and “Description of the Mortgage Pool—The Loan | |||||
S-21 |
Combinations—The Crowne Plaza Bloomington Loan Combination” in this prospectus supplement. | |||||
There are no serviced loan combinations, serviced companion loans, serviced outside controlled loan combinations, subordinate companion loans or AB loan combinations related to this securitization transaction and, therefore, all references in this prospectus supplement to “serviced loan combinations”, “serviced companion loans”, “serviced outside controlled loan combinations”, “subordinate companion loans”, “AB loan combinations” or any related terms should be disregarded. | |||||
Each outside controlling class representative and each holder of a companion loan may have interests in conflict with those of the holders of the offered certificates. See “Risk Factors—Potential Conflicts of Interest of a Directing Holder, any Outside Controlling Class Representative and any Companion Loan Holder” and “—Loan Combinations Pose Special Risks” in this prospectus supplement. | |||||
Trustee and Custodian | Deutsche Bank Trust Company Americas, a New York banking corporation. The corporate trust offices of Deutsche Bank Trust Company Americas are located at 1761 East St. Andrew Place, Santa Ana, California 92705-4934, Attention: Trust Administration-CGCMT Commercial Mortgage Trust 2015-GC31. Following the transfer of the underlying mortgage loans into the issuing entity, the trustee, on behalf of the issuing entity, will become the mortgagee of record with respect to each of the mortgage loans (other than any outside serviced mortgage loan) transferred to the issuing entity. In addition, subject to the terms of the pooling and servicing agreement, the trustee will be primarily responsible for back-up advancing. See “Transaction Parties—The Trustee” in this prospectus supplement. | ||||
As described under “—CGCMT 2015-GC29 Servicer, Special Servicer, Trustee and Custodian” below, Deutsche Bank Trust Company Americas is the trustee for the securitization of the controlling Selig Office Portfolio companion loan and controlling Crowne Plaza Bloomington companion loan, and, accordingly, the mortgagee of record for the Selig Office Portfolio loan combination and Crowne Plaza Bloomington loan combination. | |||||
As described under “—GSMS 2015-GC30 Servicer, Special Servicer, Trustee and Custodian” below, U.S. Bank National Association is the trustee for the securitization of the controlling Dallas Market Center companion loan and, accordingly, the mortgagee of record for the Dallas Market Center loan combination. | |||||
Certificate Administrator | Citibank, N.A., a national banking association organized under the laws of the United States. The corporate trust office of the Certificate Administrator responsible for: (i) administration of the issuing entity is located at 388 Greenwich Street, 14th Floor, New York, New York 10013, Attention: Global Transaction Services – CGCMT Commercial Mortgage Trust 2015-GC31; and (ii) certificate transfer services and the presentment of Certificates for final payment thereon is located at 480 Washington Boulevard, 30th Floor, Jersey City, New Jersey 07310, Attention: Global Transaction Services – CGCMT Commercial Mortgage Trust 2015-GC31. See “Transaction Parties—The Certificate Administrator” in this prospectus supplement. | ||||
S-22 |
Operating Advisor | Pentalpha Surveillance LLC, a Delaware limited liability company. At any time that a Control Termination Event (as described under “—Significant Dates, Events and Periods” below) has occurred and is continuing, the operating advisor will generally review the special servicer’s operational practices in respect of the applicable specially serviced mortgage loan(s) to formulate an opinion as to whether or not those operational practices generally satisfy the servicing standard with respect to the resolution and/or liquidation of such specially serviced mortgage loan(s). In addition, at any time after the occurrence and during the continuance of a Control Termination Event, the operating advisor will consult on a non-binding basis with the special servicer with regard to certain major decisions with respect to the applicable specially serviced mortgage loan(s) to the extent described in this prospectus supplement and as provided in the pooling and servicing agreement,providedthat the operating advisor may consult regarding a serviced outside controlled loan combination only if and to the extent that the holder of the related split mortgage loan is granted consultation rights under the related co-lender agreement. | |||
At any time after the occurrence and during the continuance of a Control Termination Event, the operating advisor will be required to review certain operational activities related to the applicable specially serviced mortgage loan(s) in general on a platform-level basis. Based on the operating advisor’s review of certain information (to be provided to the operating advisor by the special servicer) described in this prospectus supplement, the operating advisor will be required (if any applicable mortgage loan(s) were specially serviced under the pooling and servicing agreement for this securitization transaction during the prior calendar year) to prepare an annual report to be provided to the depositor, the rule 17g-5 information provider, the trustee and the certificate administrator (and made available through the certificate administrator’s website) setting forth its assessment of the special servicer’s performance of its duties under the pooling and servicing agreement on a platform-level basis with respect to the resolution and liquidation of the applicable specially serviced mortgage loan(s);provided, however, that in the event the special servicer is replaced, the operating advisor’s annual report will only relate to the entity that was acting as special servicer as of December 31 in the prior calendar year and is continuing in such capacity through the date of such annual report. No annual report will be required from the operating advisor with respect to the special servicer if during the prior calendar year no asset status report was prepared by the special servicer in connection with a specially serviced loan or REO property. | ||||
At any time that a Consultation Termination Event (as described under “—Significant Dates, Events and Periods” below) has occurred and is continuing, the operating advisor may recommend the replacement of the special servicer with respect to the mortgage loans and any companion loan(s) serviced under the pooling and servicing agreement for this securitization transaction (but not the related outside special servicer with respect to any outside serviced mortgage loan) if the operating advisor determines that the special servicer is not performing its duties as required under the pooling and servicing agreement or is otherwise not acting in accordance with the servicing standard, as described under “The Pooling and Servicing Agreement—Termination of the Special Servicer” in this prospectus supplement; provided that the operating advisor may not recommend the termination of the special servicer with respect to a serviced outside controlled loan combination without the consent of the related outside controlling note holder. | ||||
S-23 |
Additionally, if the holders of at least 15% of the voting rights of the certificates other than the Class X-A, Class S and Class R certificates (but considering only those classes of certificates that, in each case, have an outstanding certificate principal amount, as notionally reduced by any appraisal reduction amounts then allocable to the subject class, equal to or greater than 25% of (i) the initial certificate principal amount of such classminus (ii) all payments of principal previously made with respect to such class, and considering each class of the Class A-S, Class B and Class C certificates, together with the Class PEZ certificates’ applicable percentage interest of the trust component with the same alphabetic class designation, as a single “class” for such purpose) request a vote to replace the operating advisor, then the operating advisor may be replaced by the holders of more than 50% of the voting rights of the certificates other than the Class X-A, Class S and Class R certificates (but considering only those classes of certificates that, in each case, have an outstanding certificate principal amount, as notionally reduced by any appraisal reduction amounts then allocable to the subject class, equal to or greater than 25% of (i) the initial certificate principal amount of such classminus (ii) payments of principal previously made with respect to such class, and considering each class of the Class A-S, Class B and Class C certificates, together with the Class PEZ certificates’ applicable percentage interest of the trust component with the same alphabetic class designation, as a single “class” for such purpose) that exercise their right to vote;provided that holders of at least 50% of the voting rights of such certificates exercise their right to vote. See “The Pooling and Servicing Agreement—Operating Advisor—Termination of the Operating Advisor Without Cause” in this prospectus supplement. | ||||
For additional information regarding the operating advisor and its responsibilities, see “Transaction Parties—The Operating Advisor” and “The Pooling and Servicing Agreement—Operating Advisor” in this prospectus supplement. | ||||
Master Servicer | Wells Fargo Bank, National Association, a national banking association. The master servicer will initially service all of the mortgage loans (other than any outside serviced mortgage loan) and any serviced companion loans either directly or through a sub-servicer pursuant to the pooling and servicing agreement. The principal west coast commercial mortgage master servicing offices of Wells Fargo Bank, National Association are located at MAC-A0227-020, 1901 Harrison Street, Oakland, California 94612. The principal east coast commercial mortgage master servicing offices of Wells Fargo Bank, National Association are located at MAC-D1086-120, 550 South Tryon Street, Charlotte, North Carolina 28202. See “Transaction Parties—Servicers—The Master Servicer”, “—Servicing Compensation, Operating Advisor Compensation and Payment of Expenses” and “The Pooling and Servicing Agreement—Servicing of the Mortgage Loans” in this prospectus supplement. | |||
The mortgage loans transferred to the issuing entity (other than any outside serviced mortgage loans) are sometimes referred to in this prospectus supplement as the “serviced mortgage loans,” and all of the serviced mortgage loans, together with any serviced companion loan(s), are sometimes referred to in this prospectus supplement as the “serviced loans.” | ||||
As described under “—CGCMT 2015-GC29 Servicer, Special Servicer, Trustee and Custodian” below, Midland Loan Services, a Division of | ||||
S-24 |
PNC Bank, National Association, a national banking association, is the initial servicer for the Selig Office Portfolio loan combination and the Crowne Plaza Bloomington loan combination pursuant to the CGCMT 2015-GC29 pooling and servicing agreement. | |||||
As described under “—GSMS 2015-GC30 Servicer, Special Servicer, Trustee and Custodian” below, Midland Loan Services, a Division of PNC Bank, National Association, a national banking association, is the initial servicer for the Dallas Market Center loan combination pursuant to the GSMS 2015-GC30 pooling and servicing agreement. | |||||
Special Servicer | Torchlight Loan Services, LLC, a Delaware limited liability company, is the initial special servicer with respect to all of the mortgage loans (other than any outside serviced mortgage loan) and any serviced companion loans pursuant to the pooling and servicing agreement. The special servicer will be primarily responsible for making decisions and performing certain servicing functions with respect to any such mortgage loan or loan combination that, in general, is in default or as to which default is reasonably foreseeable. Torchlight Loan Services, LLC was appointed to be the special servicer for this securitization transaction at the request of Torchlight Investors, LLC, on behalf of one or more managed funds or accounts, which is expected to be the initial controlling class representative and the initial directing holder with respect to all of the mortgage loans and loan combinations serviced under the pooling and servicing agreement for this securitization transaction other than any serviced outside controlled loan combinations. Torchlight Investors, LLC, on behalf of one or more managed funds or accounts is expected to purchase, on the closing date, the Class E, Class F, Class G, Class H and Class S certificates (and may also purchase additional classes of certificates). See “—Directing Holder/Controlling Class Representative” below. The primary servicing office of Torchlight Loan Services, LLC is located at 701 Brickell Avenue, Suite 2200, Miami, Florida 33131, and its telephone number is (212) 883-2800. See “Transaction Parties—Servicers—The Special Servicer”, “—Servicing Compensation, Operating Advisor Compensation and Payment of Expenses” and “The Pooling and Servicing Agreement—Servicing of the Mortgage Loans” in this prospectus supplement. | ||||
As described under “—CGCMT 2015-GC29 Servicer, Special Servicer, Trustee and Custodian” below, Midland Loan Services, a Division of PNC Bank, National Association, a national banking association, is the initial special servicer for the Selig Office Portfolio loan combination and the Crowne Plaza Bloomington loan combination pursuant to the CGCMT 2015-GC29 pooling and servicing agreement. | |||||
As described under “—GSMS 2015-GC30 Servicer, Special Servicer, Trustee and Custodian” below, Midland Loan Services, a Division of PNC Bank, National Association, a national banking association, is the initial special servicer for the Dallas Market Center loan combination pursuant to the GSMS 2015-GC30 pooling and servicing agreement. | |||||
The special servicer (but not the outside special servicer with respect to any outside serviced mortgage loan) may be removed in such capacity under the pooling and servicing agreement, with or without cause, and a successor special servicer appointed, from time to time, as follows: | |||||
· | unless a Control Termination Event has occurred and is continuing, the special servicer may be removed and replaced by the controlling class representative (other than with respect to any serviced outside | ||||
S-25 |
controlled loan combination) with or without cause at any time, upon satisfaction of certain conditions specified in the pooling and servicing agreement; | |||||
· | after the occurrence and during the continuance of a Control Termination Event, the holders of at least 25% of the voting rights of the certificates (other than the Class S and Class R certificates) may request a vote to replace the special servicer (except with respect to any serviced outside controlled loan combination). The subsequent vote may result in the termination and replacement of the special servicer if within 180 days of the initial request for that vote the holders of (a) at least 75% of the voting rights of the certificates (other than the Class S and Class R certificates), or (b) more than 50% of the voting rights of each class of certificates other than the Class X-A, Class S and Class R certificates (but, for purposes of this clause (b), considering only those classes of certificates that, in each case, have an outstanding certificate principal amount, as notionally reduced by any appraisal reduction amounts then allocable to the subject class, equal to or greater than 25% of (i) the initial certificate principal amount of such classminus (ii) payments of principal previously made with respect to such class, and considering each class of the Class A-S, Class B and Class C certificates, together with the Class PEZ certificates’ applicable percentage interest of the trust component with the same alphabetic class designation, as a single “class” for such purpose), vote affirmatively to so replace; and | ||||
· | the special servicer may be removed and replaced by the related outside controlling note holder solely with respect to the related serviced outside controlled loan combination with or without cause at any time, upon satisfaction of certain conditions specified in the pooling and servicing agreement and the related co-lender agreement. | ||||
Additionally, at any time after the occurrence and during the continuance of a Consultation Termination Event, if the operating advisor determines that the special servicer is not performing its duties as required under the pooling and servicing agreement or is otherwise not acting in accordance with the servicing standard, the operating advisor may recommend the replacement of the special servicer with respect to any serviced loans;provided, that the operating advisor may recommend the replacement of the special servicer with respect to a serviced outside controlled loan combination only if the related outside controlling note holder so consents. In connection with such a recommendation, the special servicer would be replaced with respect to the applicable serviced loans if, within 180 days of the initial request for that vote, the holders of more than 50% of the voting rights of each class of certificates other than the Class X-A, Class S and Class R certificates (but considering only those classes of certificates that, in each case, have an outstanding certificate principal amount, as notionally reduced by any appraisal reduction amounts then allocable to the subject class, equal to or greater than 25% of (i) the initial certificate principal amount of such classminus (ii) payments of principal previously made with respect to such class, and considering each class of the Class A-S, Class B and Class C certificates, together with the Class PEZ certificates’ applicable percentage interest of the trust component with the same alphabetic class designation, as a single “class” for such purpose), vote affirmatively to so replace. | |||||
S-26 |
Further, the special servicer may be removed and replaced based on the occurrence of certain servicer termination events on the part of the special servicer, as further described under “The Pooling and Servicing Agreement—Servicer Termination Events” and “—Rights Upon Servicer Termination Event” in this prospectus supplement. In addition, in the case of a serviced loan combination, if a servicer termination event on the part of the special servicer affects only (i) the related serviced companion loan that is part of such serviced loan combination, (ii) the holder of such serviced companion loan or (iii) the rating on a class of securities backed by such serviced companion loan, then, at the direction of the holder of such serviced companion loan, in each case, the trustee will be required to terminate the special servicer solely with respect to that serviced loan combination, as further described under “The Pooling and Servicing Agreement—Servicer Termination Events” and “—Rights Upon Servicer Termination Event” in this prospectus supplement. | ||||
An outside special servicer may only be removed in such capacity in accordance with the terms and provisions of the applicable outside servicing agreement and the co-lender agreement governing the related outside serviced loan combination. | ||||
See “The Pooling and Servicing Agreement—Termination of the Special Servicer” in this prospectus supplement. See “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement for a discussion of the loan combinations and the companion loans. | ||||
CGCMT 2015-GC29 Servicer, Special Servicer, Trustee and Custodian | The Selig Office Portfolio loan combination and the Crowne Plaza Bloomington loan combination are both being serviced pursuant to the CGCMT 2015-GC29 pooling and servicing agreement, dated as of April 1, 2015. The parties to the CGCMT 2015-GC29 pooling and servicing agreement are Citigroup Commercial Mortgage Securities Inc., as depositor, Midland Loan Services, a Division of PNC Bank, National Association, as master servicer (the “CGCMT 2015-GC29 servicer” and an “outside servicer”) and special servicer (the “CGCMT 2015-GC29 special servicer” and an “outside special servicer”), Deutsche Bank Trust Company Americas, as trustee (the “CGCMT 2015-GC29 trustee” and an “outside trustee”), Citibank, N.A., as certificate administrator and Situs Holdings, LLC, as operating advisor (the “CGCMT 2015-GC29 operating advisor” and an “outside operating advisor”). Accordingly, (i) each of the Selig Office Portfolio mortgage loan and the related mortgaged properties, and the Crowne Plaza Bloomington mortgage loan and the related mortgaged property, are being serviced and administered by the CGCMT 2015-GC29 servicer and the CGCMT 2015-GC29 special servicer, (ii) the CGCMT 2015-GC29 trustee will serve as mortgagee of record with respect to each of the Selig Office Portfolio mortgage loan and the Crowne Plaza Bloomington mortgage loan, and (iii) in its capacity as custodian under the CGCMT 2015-GC29 pooling and servicing agreement, Deutsche Bank Trust Company Americas will serve as a custodian with respect to the mortgage loan file for each of the Selig Office Portfolio mortgage loan and the Crowne Plaza Bloomington mortgage loan (other than with respect to the promissory notes evidencing each of the Selig Office Portfolio mortgage loan, the Crowne Plaza Bloomington mortgage loan and any related companion loans not included in the CGCMT 2015-GC29 securitization). None of the master servicer or the special servicer (in each such capacity) or any other party to this securitization transaction is responsible for the performance by | |||
S-27 |
any party to the CGCMT 2015-GC29 pooling and servicing agreement of its duties thereunder, including with respect to the servicing of the Selig Office Portfolio mortgage loan and the Crowne Plaza Bloomington mortgage loan. | |||||
See “Transaction Parties—Servicers—The Outside Servicers and the Outside Special Servicers” and “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans—Servicing of the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan” in this prospectus supplement. | |||||
GSMS 2015-GC30 Servicer, Special Servicer, Trustee and Custodian | The Dallas Market Center loan combination is being serviced pursuant to the GSMS 2015-GC30 pooling and servicing agreement, dated as of May 1, 2015. The parties to the GSMS 2015-GC30 pooling and servicing agreement are GS Mortgage Securities Corporation II, as depositor, Midland Loan Services, a Division of PNC Bank, National Association, as master servicer (the “GSMS 2015-GC30 servicer” and an “outside servicer”) and special servicer (the “GSMS 2015-GC30 special servicer” and an “outside special servicer”), U.S. Bank National Association, as trustee (the “GSMS 2015-GC30 trustee” and an “outside trustee”) and certificate administrator, and Trimont Real Estate Advisors, Inc., as operating advisor (the “GSMS 2015-GC30 operating advisor” and an “outside operating advisor”). Accordingly, (i) the Dallas Market Center mortgage loan and the related mortgaged property are being serviced and administered by the GSMS 2015-GC30 servicer and the GSMS 2015-GC30 special servicer, (ii) the GSMS 2015-GC30 trustee will serve as mortgagee of record with respect to the Dallas Market Center mortgage loan, and (iii) in its capacity as custodian under the GSMS 2015-GC30 pooling and servicing agreement, U.S. Bank National Association will serve as a custodian with respect to the mortgage loan file for the Dallas Market Center mortgage loan (other than with respect to the promissory notes evidencing each of the Dallas Market Center mortgage loan and any related companion loan not included in the GSMS 2015-GC30 securitization). None of the master servicer or the special servicer (in each such capacity) or any other party to this securitization transaction is responsible for the performance by any party to the GSMS 2015-GC30 pooling and servicing agreement of its duties thereunder, including with respect to the servicing of the Dallas Market Center mortgage loan. | ||||
See “Transaction Parties—Servicers—The Outside Servicers and the Outside Special Servicers” and “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans—Servicing of the Dallas Market Center Mortgage Loan” in this prospectus supplement. | |||||
Directing Holder / Controlling Class Representative | The “directing holder” with respect to any mortgage loan or, if applicable, loan combination (other than an outside serviced loan combination) under the pooling and servicing agreement will be: | ||||
· | with respect to any such mortgage loan or loan combination other than a serviced outside controlled loan combination, the controlling class representative; and | ||||
· | with respect to any serviced outside controlled loan combination, the related outside controlling note holder. | ||||
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The controlling class representative under the pooling and servicing agreement will be the controlling class certificateholder or other representative selected by more than 50% of the controlling class certificateholders (by certificate principal amount). | ||||
The controlling class is the most subordinate class of the Class F, Class G and Class H certificates that has an outstanding certificate principal amount, as notionally reduced by any appraisal reduction amounts then allocable to such class, that is equal to or greater than 25% of the initial certificate principal amount of that class of certificates, or if no such class meets the preceding requirement, then Class F will be the controlling class;provided,however, that (at any time that the aggregate certificate principal amount of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB, Class D and Class E certificates and the Class A-S, Class B and Class C trust components has been reduced to zero without regard to the allocation of appraisal reduction amounts) (a) in the case of any class of the Class F, Class G and Class H certificates to which the designation of “controlling class” would otherwise shift by operation of this definition, where the certificate principal amount of such class of the Class F, Class G and Class H certificates has been reduced to zero (without regard to the allocation of appraisal reduction amounts) prior to such shift, then designation of “controlling class” shall not shift and shall remain with the class of the Class F, Class G and Class H certificates currently designated as the controlling class, and (b) in the case of any class of the Class F, Class G and Class H certificates which is then designated the “controlling class”, if the certificate principal amount of such class of the Class F, Class G and Class H certificates is reduced to zero (without regard to the allocation of appraisal reduction amounts), then the designation of “controlling class” shall shift to the class of the Class F, Class G and Class H certificates that is the most subordinate and that also has a remaining certificate principal amount. The controlling class as of the Closing Date will be the Class H Certificates. See “Description of the Offered Certificates—Voting Rights” in this prospectus supplement. No other class of certificates will be eligible to act as the controlling class or appoint a controlling class representative. | ||||
The related outside controlling note holder (with respect to each serviced outside controlled loan combination) and, so long as a Control Termination Event does not exist, the controlling class representative (with respect to the other serviced loans)will have certain consent and/or consultation rights under the pooling and servicing agreement with respect to certain major decisions and other matters with respect to each mortgage loan or, if applicable, loan combination (other than an outside serviced loan combination). In addition, if and to the extent that the holder of the split mortgage loan included in any serviced outside controlled loan combination has consultation rights, the controlling class representative may consult with respect to certain major decisions and other matters with respect to such loan combination so long as a Consultation Termination Event does not exist. | ||||
After the occurrence and during the continuance of a Control Termination Event, the consent rights of the controlling class representative will terminate, and the controlling class representative will retain consultation rights under the pooling and servicing agreement with respect to certain major decisions and other matters with respect to the applicable serviced loans. | ||||
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After the occurrence and during the continuance of a Consultation Termination Event, all of these rights of the controlling class representative with respect to the applicable serviced loans will terminate. See “The Pooling and Servicing Agreement—Directing Holder” in this prospectus supplement. | ||||
If, with respect to any serviced outside controlled loan combination, the related controlling note is included in a separate securitization trust, the pooling and servicing agreement, trust and servicing agreement or comparable agreement for the relevant securitization may impose limitations on the exercise of rights associated with that related controlling note. For example, any “controlling class representative” (or equivalent entity) for such other securitization may lose consent and consultation rights in a manner similar to that described in the prior two paragraphs with respect to the CGCMT 2015-GC31 controlling class representative. | ||||
Torchlight Investors, LLC, on behalf of one or more managed funds or accounts, is expected, on the closing date, to (i) purchase the Class E, Class F, Class G, Class H and Class S certificates, and (ii) appoint Torchlight Investors, LLC, on behalf of one or more managed funds or accounts, to be the initial controlling class representative (and initial directing holder with respect to all of the mortgage loans and loan combinations serviced under the pooling and servicing agreement for this securitization transaction other than (x) any serviced AB loan combination, with respect to which the initial directing holder will be the holder of the related subordinate companion loan and (y) any serviced outside controlled loan combination, with respect to which the initial directing holder will be the holder of the related pari passu companion loan). | ||||
The related outside controlling note holder (with respect to each serviced outside controlled loan combination) and, so long as a Control Termination Event does not exist, the controlling class representative (with respect to the other serviced loans) may direct the special servicer to take actions with respect to the servicing of the applicable serviced mortgage loan(s) that could adversely affect the holders of some or all of the classes of certificates, and may remove and replace the special servicer with respect to the applicable serviced loan(s), with or without cause. | ||||
Notwithstanding anything to the contrary described in this prospectus supplement, at any time when the Class F certificates are the controlling class certificates, the holder of more than 50% of the controlling class certificates (by outstanding certificate principal amount) may waive its right to act as or appoint a controlling class representative and to exercise any of the rights of the controlling class representative or cause the exercise of any of the rights of the controlling class representative set forth in the pooling and servicing agreement, by irrevocable written notice delivered to the depositor, certificate administrator, trustee, master servicer, special servicer and operating advisor. Any such waiver will remain effective with respect to such holder and the Class F certificates until such time as that certificateholder has (i) sold a majority of the Class F certificates (by outstanding certificate principal amount) to an unaffiliated third party and (ii) certified to the depositor, certificate administrator, trustee, master servicer, special servicer and operating advisor that (a) the transferor retains no direct or indirect voting rights with respect to the Class F certificates that it does not own, (b) there is no voting agreement between the transferee and the transferor, and (c) | ||||
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the transferor retains no direct or indirect controlling interest in the Class F certificates. Following any such transfer, the successor holder of more than 50% of the Class F certificates (by outstanding certificate principal amount), if the Class F certificates are the controlling class certificates, will again have the rights of the controlling class representative as described in this prospectus supplement without regard to any prior waiver by the predecessor certificateholder. The successor certificateholder will also have the right to irrevocably waive its right to act as or appoint a controlling class representative or to exercise any of the rights of the controlling class representative or cause the exercise of any of the rights of the controlling class representative. No successor certificateholder described above will have any consent rights with respect to any mortgage loan that became a specially serviced mortgage loan prior to its acquisition of a majority of the Class F certificates that had not also become a corrected mortgage loan prior to such acquisition until such mortgage loan becomes a corrected mortgage loan. | |||||
Whenever such an “opt-out” by a controlling class certificateholder is in effect: | |||||
· | a Control Termination Event and a Consultation Termination Event will be deemed to have occurred and be continuing; and | ||||
· | the rights of the holder of more than 50% of the Class F certificates (by outstanding certificate principal amount), if they are the controlling class certificates, to act as or appoint a controlling class representative and the rights of the controlling class representative will not be operative (notwithstanding whether a Control Termination Event or a Consultation Termination Event is or would otherwise then be in effect with respect to the controlling class representative). | ||||
The controlling class representative and any outside controlling note holder may have interests in conflict with those of the holders of the offered certificates. See “Risk Factors—Potential Conflicts of Interest of a Directing Holder, any Outside Controlling Class Representative and any Companion Loan Holder” in this prospectus supplement. | |||||
Significant Affiliations | |||||
and Relationships | Certain parties to this securitization transaction, as described under “Transaction Parties—Certain Affiliations and Certain Relationships—Transaction Party and Related Party Affiliations”in this prospectus supplement, may: | ||||
· | serve in multiple capacities with respect to this securitization transaction; | ||||
· | be affiliated with other parties to this securitization transaction, a controlling class certificateholder, the controlling class representative and/or the holder of a companion loan or any securities backed in whole or in part by a companion loan; | ||||
· | serve as an outside servicer, outside special servicer, outside trustee or outside operating advisor with respect to any securitization involving a companion loan in an outside serviced loan combination; or | ||||
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· | be affiliated with an outside servicer, outside special servicer, outside trustee or outside operating advisor with respect to any securitization involving a companion loan in an outside serviced loan combination. | ||||
In addition, certain parties to this securitization transaction or a directing holder may otherwise have financial relationships with other parties to this securitization transaction. Such relationships may include, without limitation: | |||||
· | serving as warehouse lender to one or more of the sponsors and/or originators of this securitization transaction through a repurchase facility or otherwise (including with respect to certain mortgage loans to be contributed to this securitization transaction), where the proceeds received by such sponsor(s) and/or originator(s) in connection with the contribution of mortgage loans to this securitization transaction will be applied to, among other things, reacquire the financed mortgage loans from the repurchase counterparty or other warehouse provider (see“Transaction Parties—Certain Affiliations and Certain Relationships—Warehouse Financing Arrangements”in this prospectus supplement); | ||||
· | serving as interim servicer for one or more of the sponsors and/or originators of this securitization transaction (including with respect to certain mortgage loans to be contributed by such sponsor(s) and/or originator(s) to this securitization transaction) (see“Transaction Parties—Certain Affiliations and Certain Relationships—Interim Servicing Arrangements”in this prospectus supplement); | ||||
· | serving as interim custodian for one or more of the sponsors and/or originators of this securitization transaction (including with respect to certain mortgage loans to be contributed by such sponsor(s) and/or originator(s) to this securitization transaction) (see“Transaction Parties—Certain Affiliations and Certain Relationships—Interim and Other Custodial Arrangements” in this prospectus supplement); | ||||
· | entering into one or more agreements with the sponsors to purchase the servicing rights to the related mortgage loans and/or the right to be appointed as the master servicer with respect to such mortgage loans; and/or | ||||
· | performing due diligence services prior to the securitization closing date for one or more sponsors, a controlling class certificateholder or the controlling class representative with respect to certain of the mortgage loans to be contributed to this securitization transaction (see“Transaction Parties–Certain Affiliations and Certain Relationships–Other Arrangements” in this prospectus supplement). | ||||
In addition, certain of the sponsors and/or other parties to this securitization transaction or their respective affiliates may hold mezzanine debt, a companion loan, securities backed in whole or in part by a companion loan, or other additional debt related to one or more of the mortgage loans to be included in this securitization transaction, and as such may have certain rights relating to the related mortgage loan(s) and/or loan combination(s), as described under “Transaction Parties—Certain Affiliations and Certain Relationships—Loan Combination and Mezzanine Loan Arrangements” in this prospectus supplement. In the event a sponsor or other party to this securitization transaction or any affiliate of any of the foregoing includes any companion loan in a | |||||
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separate securitization transaction, such sponsor, other party or affiliate may be obligated to repurchase such companion loan from the applicable separate securitization trust in connection with certain breaches of representations and warranties and certain document defects. | ||||||
Each of the foregoing relationships, to the extent applicable, is described under “Transaction Parties—Certain Affiliations and Certain Relationships” in this prospectus supplement. | ||||||
These roles and other potential relationships may give rise to conflicts of interest as further described under“Risk Factors—Interests and Incentives of the Originators, the Sponsors and Their Affiliates May Not Be Aligned with Your Interests” and “—Other Potential Conflicts of Interest May Affect Your Investment” in this prospectus supplement. | ||||||
Significant Obligor | The mortgaged property identified on Annex A to this prospectus supplement as 135 South LaSalle, securing a mortgage loan representing approximately 13.8% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, is a “significant obligor” (as such term is used in Items 1101 and 1112 of Regulation AB under the Securities Act of 1933, as amended) with respect to this offering. See “Description of the Mortgage Pool—Significant Obligor” in this prospectus supplement and “Structural and Collateral Term Sheet—135 South LaSalle” in Annex B to this prospectus supplement. | |||||
Significant Dates, Events and Periods | ||||||
Cut-off Date | With respect to each mortgage loan, the due date in July 2015 for that mortgage loan. | |||||
Closing Date | On or about July 8, 2015. | |||||
Distribution Date | The certificate administrator will make distributions on the certificates, to the extent of available funds, on the fourth business day following the related determination date of each month, beginning in August 2015, to the holders of record at the end of the previous calendar month. | |||||
Determination Date | The sixth day of each calendar month or, if the sixth day is not a business day, the next business day, beginning in August 2015. | |||||
Expected Final Distribution Date | Class A-1 | July 2020 | ||||
Class A-2 | May 2022 | |||||
Class A-3 | May 2025 | |||||
Class A-4 | June 2025 | |||||
Class A-AB | February 2025 | |||||
Class X-A | June 2025 | |||||
Class A-S | June 2025 | |||||
Class B | June 2025 | |||||
Class PEZ | June 2025 | |||||
Class C | June 2025 | |||||
Class D | June 2025 | |||||
The expected final distribution date for each class of offered certificates is the date on which that class is expected to be paid in full (or, in the case of the Class X-A certificates, the date on which the related notional amount is reduced to zero), assuming no delinquencies, losses, modifications, extensions or accelerations of maturity dates, repurchases or prepayments of the mortgage loans after the initial issuance of the | ||||||
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offered certificates (other than the assumed repayment of a mortgage loan on any anticipated repayment date for such mortgage loan). | ||||
The expected final distribution date with respect to each class of the Class A-S, Class B, Class PEZ and Class C certificates assumes that the maximum certificate principal amount of that class of certificates was issued on the closing date and there were no subsequent exchanges of such certificates. | ||||
Rated Final Distribution Date | As to each class of offered certificates, the distribution date in June 2048. | |||
Collection Period | For any mortgage loan and any distribution date, the period commencing on the day immediately following the due date (without regard to grace periods) for that mortgage loan in the month preceding the month in which the applicable distribution date occurs (or, in the case of the distribution date occurring in August 2015, beginning on the day after the cut-off date) and ending on and including the due date (without regard to grace periods) for that mortgage loan in the month in which the applicable distribution date occurs. | |||
Control Termination Event | A “Control Termination Event” will either (a) occur when none of the classes of Class F, Class G and Class H certificates has an outstanding certificate principal amount (as notionally reduced by any appraisal reduction amounts then allocable to such class) that is at least equal to 25% of the initial certificate principal amount of that class of certificates or (b) be deemed to occur as described under“The Pooling and Servicing Agreement—Directing Holder—General” in this prospectus supplement;provided,however, that a Control Termination Event will in no event exist at any time that the aggregate certificate principal amount of each class of certificates (other than the classes of Class F, Class G and Class H certificates) (without regard to the allocation of appraisal reduction amounts) has been reduced to zero. | |||
Consultation Termination Event | A “Consultation Termination Event” will either (a) occur when none of the classes of Class F, Class G and Class H certificates has an outstanding certificate principal amount, without regard to the allocation of any appraisal reduction amounts, that is equal to or greater than 25% of the initial certificate principal amount of that class of certificates or (b) be deemed to occur as described under “The Pooling and Servicing Agreement—Directing Holder—General” in this prospectus supplement;provided,however, that a Consultation Termination Event will in no event exist at any time that the aggregate certificate principal amount of each class of certificates (other than the classes of Class F, Class G and Class H certificates) (without regard to the allocation of appraisal reduction amounts) has been reduced to zero. | |||
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The Mortgage Loans | |||||
General | The issuing entity’s primary assets will be 50 fixed rate mortgage loans (subject to the discussion regarding mortgage loans with an anticipated repayment date under “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—ARD Loans”in this prospectus supplement) with an aggregate outstanding principal balance as of the cut-off date of $723,323,870. The mortgage loans are secured by first liens on 76 commercial and multifamily properties located in 26 states. See “Risk Factors—Commercial and Multifamily Lending Is Dependent on Net Operating Income” in this prospectus supplement. | ||||
Fee Simple / Leasehold | Seventy-four (74) mortgaged properties, securing approximately 99.1% of the aggregate principal balance of the pool of mortgage loans, by allocated loan amount, as of the cut-off date, are each subject to a mortgage, deed of trust or similar security instrument that creates a first mortgage lien on a fee simple estate in the entire related mortgaged property. For purposes of this prospectus supplement, an encumbered interest will be characterized as a “fee interest” and not a leasehold interest if (i) the borrower has a fee interest in all or substantially all of the mortgaged property, or (ii) the mortgage loan is secured by the borrower’s leasehold interest in the mortgaged property as well as the borrower’s (or other fee owner’s) overlapping fee interest in the related mortgaged property. | ||||
Two (2) mortgaged properties, collectively securing approximately 0.9% of the aggregate principal balance of the pool of mortgage loans, by allocated loan amount, as of the cut-off date, are each subject to a mortgage, deed of trust or similar security instrument that creates a first mortgage lien on (x) one or more leasehold interests in a material portion of the related mortgaged property and (y) one or more fee interests in the remaining portion of the related mortgaged property. | |||||
See “Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans—Leasehold Interests” in this prospectus supplement. | |||||
The Loan Combinations | Each of three (3) of the mortgage loans, representing approximately 9.95%, 9.9% and 1.7%, respectively, of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, is part of a split loan structure or loan combination, which is comprised of the subject mortgage loan and one or more relatedpari passu or subordinate companion loans that are held outside the issuing entity. In the case of a loan combination, the related mortgage loan and companion loans are each evidenced by separate promissory notes but are all secured by the same mortgages or deeds of trust encumbering the same mortgaged property or portfolio of mortgaged properties. The loan combinations related to this securitization transaction are: | ||||
· | the Selig Office Portfolio loan combination, consisting of (i) the Selig Office Portfolio mortgage loan, which is being contributed to this securitization transaction, (ii) the Selig Office Portfolio companion loan that is evidenced by the controlling note A-1, which was contributed by Goldman Sachs Mortgage Company into the CGCMT 2015-GC29 securitization, (iii) the Selig Office Portfolio companion loan that is evidenced by the non-controlling note A-2, which was contributed by Goldman Sachs Mortgage Company into the GSMS 2015-GC30 securitization, and (iv) the Selig Office Portfolio companion loan that is evidenced by the non-controlling note A-4, which is currently held by Goldman Sachs Mortgage Company and is | ||||
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expected to be contributed to one or more future commercial mortgage securitization transactions; | ||||||||||||||||||
· | the Dallas Market Center loan combination, consisting of (i) the Dallas Market Center mortgage loan, which is being contributed to this securitization transaction, (ii) the Dallas Market Center companion loan that is evidenced by the controlling note A-1, which was contributed by Goldman Sachs Mortgage Company into the GSMS 2015-GC30 securitization, and (iii) the Dallas Market Center companion loan that is evidenced by the non-controlling note A-3, which is currently held by Goldman Sachs Mortgage Company and is expected to be contributed to one or more future commercial mortgage securitization transactions; and | |||||||||||||||||
· | the Crowne Plaza Bloomington loan combination, consisting of the Crowne Plaza Bloomington mortgage loan, which is being contributed to this securitization transaction, and the Crowne Plaza Bloomington companion loan, which was contributed by Citigroup Global Markets Realty Corp. to the CGCMT 2015-GC29 securitization. | |||||||||||||||||
Certain information regarding the loan combination(s) is identified in the following table: | ||||||||||||||||||
Mortgaged Property Name | Mortgage Loan Cut-off Date Balance | Mortgage Loan as a % of Initial Pool Balance | Pari Passu Companion Loan Cut-off Date Balance | Subordinate Companion Loan Cut-off Date Balance | Loan Combination Cut-off Date Balance | |||||||||||||
Selig Office Portfolio | $72,000,000 | 9.95% | $273,000,000 | (1) | N/A | $345,000,000 | ||||||||||||
Dallas Market Center | $71,803,978 | 9.9% | $186,490,887 | (2) | N/A | $258,294,865 | ||||||||||||
Crowne Plaza Bloomington | $12,170,872 | 1.7% | $13,909,568 | N/A | $26,080,440 | |||||||||||||
(1) | The Selig Office Portfolio pari passu companion loans are currently comprised of the controlling note A-1, with an outstanding principal balance as of the cut-off date of $125,000,000, the non-controlling note A-2, with an outstanding principal balance as of the cut-off date of $123,000,000, and the non-controlling note A-4, with an outstanding principal balance as of the cut-off date of $25,000,000. | |||||||||||||||||
(2) | The Dallas Market Center pari passu companion loans are currently comprised of the controlling note A-1, with an outstanding principal balance as of the cut-off date of $129,646,071, and the non-controlling note A-3, with an outstanding principal balance as of the cut-off date of $56,844,816. | |||||||||||||||||
With respect to any mortgage loan that is part of a loan combination, the loan-to-value ratio, debt service coverage ratio and debt yield have been calculated based on both that mortgage loan and any related pari passu companion loan(s), but without regard to any related subordinate companion loan(s), unless otherwise indicated. | ||||||||||||||||||
For more information regarding the loan combination(s), see “Description of the Mortgage Pool—The Loan Combinations” and “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement. Also, see “Structural and Collateral Term Sheet—Structural Overview” in Annex B to this prospectus supplement. | ||||||||||||||||||
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Due Dates / Grace Periods | Subject in some cases to a next business day convention, monthly payments of principal and/or interest on each mortgage loan are due as shown below with the indicated grace periods. | |||||||||||||
Due Date | Default Grace | Number of | % of Initial | |||||||||||
6 | 0 | 43 | 82.4 | % | ||||||||||
6 | 5 | (1) | 1 | 9.9 | ||||||||||
1 | 5 | 6 | 7.7 | |||||||||||
Total | 50 | 100.0 | % | |||||||||||
(1) | The mortgage loan permits a five-day grace period once during the loan term. | |||||||||||||
As used in this prospectus supplement, “grace period” is the number of days before a payment default is an event of default under each mortgage loan. See Annex A to this prospectus supplement for information on the number of days before late payment charges are due under each mortgage loan. The information on Annex A to this prospectus supplement regarding the number of days before a late payment charge is due is based on the express terms of the mortgage loans. Some jurisdictions may impose a statutorily longer period. | ||||||||||||||
Interest-Only Mortgage Loans / | ||||||||||||||
Amortizing Mortgage Loans | Five (5) of the mortgage loans, representing approximately 28.8% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, provide for monthly payments of interest-only until their maturity dates or anticipated repayment dates, as applicable. The remaining 45 mortgage loans, representing approximately 71.2% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, provide for monthly payments of principal and interest based on an amortization schedule that is significantly longer than the remaining terms to maturity for such mortgage loans. However, 26 of these 45 mortgage loans, representing approximately 40.7% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, provide for an initial interest-only period ranging from 12 months to 72 months following the related origination date. | |||||||||||||
The following mortgage loan is characterized by a non-standard amortization schedule: | ||||||||||||||
· | the mortgage loan secured by the mortgaged property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, representing approximately 4.1% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, amortizes based on the non-standard amortization schedule set forth on Annex G to this prospectus supplement. | |||||||||||||
Balloon Loans / ARD Loans | All of the mortgage loans will have substantial principal payments due on their respective maturity dates unless prepaid earlier, subject to the terms and conditions of the prepayment provisions of each mortgage loan;provided, that if any loans with anticipated repayment dates, as described under“Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—ARD Loans” in this prospectus supplement, are included in the issuing entity, such mortgage loans will have substantial principal payments due on their respective anticipated repayment dates, unless prepaid earlier. | |||||||||||||
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One (1) of the mortgage loans, representing approximately 13.8% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, provides for an increase in the related interest rate after a certain date, referred to as an anticipated repayment date, if the related borrower has not prepaid such mortgage loan in full. Payment of the interest accrued in excess of the original rate for such mortgage loan will be deferred, and such interest will not be paid until the principal balance of the subject mortgage loan has been paid, at which time any such deferred “excess interest” that is collected will be paid to the holders of the Class S certificates, which are not offered by this prospectus supplement. In addition, from and after the anticipated repayment date for such mortgage loan, cash flow in excess of that required for debt service, funding of reserves, other amounts then due and payable under the related mortgage loan documents (other than “excess interest”) and certain budgeted or non-budgeted expenses approved by the related lender with respect to the related mortgaged property will be applied toward the payment of principal (without payment of a yield maintenance charge or other prepayment premium) of the subject mortgage loan until its principal balance has been reduced to zero. Although these provisions may create an incentive for the related borrower to repay its respective mortgage loan in full on the related anticipated repayment date, a substantial payment would be required and such borrower has no obligation to do so. See “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—ARD Loans” in this prospectus supplement. | ||||||||
Additional Characteristics | ||||||||
of the Mortgage Loans | General characteristics of the mortgage loans as of the cut-off date: | |||||||
All Mortgage Loans | ||||||||
Initial Pool Balance(1) | $723,323,870 | |||||||
Number of Mortgage Loans | 50 | |||||||
Number of Mortgaged Properties | 76 | |||||||
Average Cut-off Date Mortgage Loan Balance | $14,466,477 | |||||||
Weighted Average Mortgage Loan Rate(2) | 4.0831% | |||||||
Range of Mortgage Loan Rates(2) | 3.2950% – 4.8500% | |||||||
Weighted Average Cut-off Date Loan-to-Value Ratio(2)(3) | 60.7% | |||||||
Weighted Average Maturity Date/ARD Loan-to-Value Ratio(2)(4)(5) | 52.7% | |||||||
Weighted Average Cut-off Date Remaining Term to Maturity Date/ARD (months)(5) | 118 | |||||||
Weighted Average Cut-off Date DSCR(2)(6) | 2.29x | |||||||
Full-Term Amortizing Balloon Mortgage Loans | 30.5% | |||||||
Partial Interest-Only Balloon Mortgage Loans | 40.7% | |||||||
Interest-Only Balloon Mortgage Loans(5) | 28.8% | |||||||
(1) | Subject to a permitted variance ofplus orminus 5%. | |||||||
(2) | With respect to each mortgage loan that is part of a loan combination, the Mortgage Loan Rate, Cut-off Date Loan-to-Value Ratio, Maturity Date/ARD Loan-to-Value Ratio and Cut-off Date DSCR are calculated based on both that mortgage loan and any related pari passu companion loan(s), but without regard to any related subordinate companion loan(s), unless otherwise indicated. Other than as specifically noted, the Cut-off Date Loan-to-Value Ratio, Maturity Date/ARD Loan-to-Value Ratio, Cut-off Date DSCR and Mortgage Loan Rate information for each mortgage loan is presented in this prospectus supplement without regard to any other indebtedness (whether or not secured by the related mortgaged property, ownership interests in the related borrower or otherwise) that currently exists or that may be incurred by the related borrower or its owners in the future. | |||||||
(3) | In most cases, the Cut-off Date Loan-to-Value Ratio for each mortgage loan is calculated utilizing the “as-is” appraised value. However, with respect to 3 mortgage loans, representing approximately 3.0% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, the respective Cut-off Date Loan-to-Value Ratio was calculated using either (i) an “as-is” appraised value plus related property improvement plan costs which were reserved for at origination, or (ii) the cut-off date principal balance of | |||||||
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a mortgage loan less a reserve taken at origination. The weighted average Cut-off Date Loan-to-Value Ratio for the mortgage pool using only “as-is” appraised values and without making any of the adjustments described above is 61.2%. See the definitions of “Appraised Value” and “Cut-off Date Loan-to-Value Ratio” under “Description of the Mortgage Pool—Certain Calculations and Definitions” in this prospectus supplement. | |||||
(4) | In the majority of cases, the Maturity Date/ARD Loan-to-Value Ratio for each mortgage loan is calculated utilizing the “as-is” appraised value. However, in the case of 14 mortgage loans, representing approximately 31.5% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, the Maturity Date/ARD Loan-to-Value Ratio is calculated using an “as stabilized”, “as stabilized/as completed” or a “prospective market value upon stabilization” appraised value instead of the related “as-is” appraised value, as further described under the definitions of “Appraised Value” and “Maturity Date/ARD Loan-to-Value Ratio” under “Description of the Mortgage Pool—Certain Calculations and Definitions” in this prospectus supplement. If the Maturity Date/ARD Loan-to-Value Ratios of those 14 mortgage loans were calculated using an “as-is” appraised value, then the weighted average Maturity Date/ARD Loan-to-Value Ratio for the mortgage pool would be 53.6%. | ||||
(5) | Includes the mortgage loan secured by the mortgaged property identified on Annex A to this prospectus supplement as 135 South LaSalle, representing approximately 13.8% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, which has an anticipated repayment date and is assumed to mature and pay in full on its anticipated repayment date. | ||||
(6) | With respect to the mortgage loan secured by the mortgaged property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, representing approximately 4.1% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, which amortizes based on the non-standard amortization schedule set forth on Annex G to this prospectus supplement, the Cut-off Date DSCR of such mortgage loan is calculated based on the aggregate debt service during the 12-month period commencing August 1, 2015. | ||||
See“Description of the Mortgage Pool—Certain Calculations and Definitions” in this prospectus supplement for important general and specific information regarding the manner of calculation of the underwritten debt service coverage ratios and loan-to-value ratios. | |||||
Modified and Refinanced | |||||
Mortgage Loans | Four (4) of the mortgage loans, representing approximately 12.0% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, were refinancings in whole or in part of loans that were (or refinancings of temporary bridge loans that in turn refinanced loans that were) in default at the time of refinancing or otherwise involved discounted pay-offs or provided acquisition financing for the related borrower’s purchase of the related mortgaged property at a foreclosure sale or after becoming REO, as described below: | ||||
· | With respect to the mortgage loan secured by the mortgaged property identified on Annex A to this prospectus supplement as Dallas Market Center, representing approximately 9.9% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, the proceeds of the mortgage loan were used to pay off a bridge mortgage loan secured by the buildings included in the mortgaged property identified as Trade Mart and World Trade Center, which bridge loan was used to refinance a prior loan that went into maturity default in 2014 and had been moved to special servicing. | ||||
· | With respect to the mortgage loan secured by the mortgaged property identified on Annex A to this prospectus supplement as Infinity Corporate Center, representing approximately 0.9% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, the borrower acquired the mortgaged property as part of a distressed REO sale in October 2014. In 2012, the prior owner of the mortgaged property defaulted on its loan, which was securitized in a separate transaction, after the loss of a major tenant and the reduction in space of another tenant. | ||||
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· | With respect to the mortgage loan secured by the mortgaged property identified on Annex A to this prospectus supplement as Northfield Office Complex, representing approximately 0.7% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, the proceeds of the mortgage loan were used to fund, in part, a discounted payoff of a mortgage loan originated in 2005 in the initial principal amount of $24,300,000. The discounted payoff amount was $7,300,000. | ||||
· | With respect to the mortgage loan secured by the mortgaged property identified on Annex A to this prospectus supplement as Dorchester Village Apartments, representing approximately 0.5% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, the proceeds of the mortgage loan were used, in part, to pay off in full a mortgage loan secured by the related mortgaged property that was subject to a foreclosure action due to a maturity default. | ||||
See “Description of the Mortgage Pool—Default History, Bankruptcy Issues and Other Proceedings” in this prospectus supplement. | |||||
Certain risks relating to bankruptcy proceedings are described in “Risk Factors—A Bankruptcy Proceeding May Result in Losses and Delays in Realizing on the Mortgage Loans” in this prospectus supplement. | |||||
Interest Accrual Basis | All of the mortgage loans accrue interest on the basis of the actual number of days in each applicable one-month accrual period, assuming a 360-day year. | ||||
Prepayment / Defeasance / | |||||
Property Release Provisions | The terms of each mortgage loan restrict the ability of the borrower to defease and/or prepay the mortgage loan as follows: | ||||
· | Forty-four (44) mortgage loans, representing approximately 86.3% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, permit the related borrower, after a lockout period of at least 2 years following the closing date (or, in the case of a loan combination, the earlier of (a) the second anniversary of the securitization of the last note included in such loan combination and (b) a specified date no earlier than three years from the date of origination of such loan combination) and prior to the related open prepayment period described below, to substitute U.S. government securities as collateral and obtain a release of the related mortgaged property (or, if applicable, one or more of the related mortgaged properties), but the borrower may not prepay the mortgage loan in whole prior to such open prepayment period. | ||||
· | In addition, 6 mortgage loans, representing approximately 13.7% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, permit the related borrower, after a lockout period of 11 to 26 payments following the origination date, to prepay the mortgage loan in whole or, in some cases, in connection with a partial release of a mortgaged property, in part, in each case together with the payment of the greater of a yield maintenance charge and a prepayment premium of 1% of the prepaid amount if such prepayment occurs prior to the related open prepayment period described below. | ||||
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See“Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—Partial Releases”, “—Certain Terms of the Mortgage Loans—Voluntary Prepayments”and“—Certain Terms of the Mortgage Loans—’Due-On-Sale’ and ‘Due-On-Encumbrance’ Provisions” in this prospectus supplement. | |||||||||||||||
Notwithstanding the foregoing restrictions on prepayments, the mortgage loans generally permit voluntary prepayment without payment of a yield maintenance charge or any prepayment premium during a limited “open period” immediately prior to and including the maturity date or anticipated repayment date, as applicable, as follows: | |||||||||||||||
Prepayment Open Periods | |||||||||||||||
Open Periods (Payments) | Number of Mortgage Loans | % of Initial Pool Balance | |||||||||||||
2 | 1 | 1.7 | % | ||||||||||||
3 | 11 | 13.8 | |||||||||||||
4 | 32 | 61.5 | |||||||||||||
5 | 3 | 20.3 | |||||||||||||
6 | 1 | 0.4 | |||||||||||||
7 | 2 | 2.4 | |||||||||||||
Total | 50 | 100.0 | % | ||||||||||||
Property Types | The following table lists the various property types of the mortgaged properties: | ||||||||||||||
Property Types of the Mortgaged Properties(1) | |||||||||||||||
Property Type | Number of Mortgaged Properties | Aggregate Cut-off Date Balance | % of Initial Pool Balance | ||||||||||||
Office | 18 | $ | 278,990,650 | 38.6 | % | ||||||||||
Mixed Use(2) | 6 | 139,586,628 | 19.3 | ||||||||||||
Retail | 16 | 120,923,697 | 16.7 | ||||||||||||
Multifamily | 12 | 90,362,331 | 12.5 | ||||||||||||
Self Storage | 15 | 55,696,014 | 7.7 | ||||||||||||
Hospitality | 3 | 26,764,550 | 3.7 | ||||||||||||
Industrial | 6 | 11,000,000 | 1.5 | ||||||||||||
Total | 76 | $ | 723,323,870 | 100.0 | % | ||||||||||
(1) | Because this table presents information relating to mortgaged properties and not the mortgage loans, the information for the mortgage loans secured by more than one mortgaged property is based on allocated loan amounts as stated in Annex A to this prospectus supplement. | ||||||||||||||
(2) | Each mixed use property includes a combination of retail, merchandise mart, office and/or flex space. | ||||||||||||||
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Property Locations | The mortgaged properties are located in 26 states. The following table lists the states that have concentrations of mortgaged properties that secure 5.0% or more of the aggregate principal balance of the pool of mortgage loans, by allocated loan amount, as of the cut-off date: | ||||||||||||||
Geographic Distribution(1) | |||||||||||||||
State | Number of Mortgaged Properties | Aggregate Cut-off Date Balance | % of Initial Pool Balance | ||||||||||||
Texas | 6 | $ | 116,123,990 | 16.1 | % | ||||||||||
California | 9 | $ | 102,000,000 | 14.1 | % | ||||||||||
Illinois | 1 | $ | 100,000,000 | 13.8 | % | ||||||||||
Washington | 9 | $ | 72,000,000 | 9.95 | % | ||||||||||
Oklahoma | 4 | $ | 51,322,427 | 7.1 | % | ||||||||||
Florida | 6 | $ | 41,969,352 | 5.8 | % | ||||||||||
Ohio | 6 | $ | 38,124,015 | 5.3 | % | ||||||||||
(1) | Because this table presents information relating to mortgaged properties and not the mortgage loans, the information for the mortgage loans secured by more than one mortgaged property is based on allocated loan amounts as stated in Annex A to this prospectus supplement. | ||||||||||||||
Certain Calculations | |||||||||||||||
and Definitions | The descriptions in this prospectus supplement of the mortgage loans and the mortgaged properties are based upon the mortgage pool as it is expected to be constituted as of the close of business on the closing date, assuming that (i) all scheduled principal and interest payments due on or before the cut-off date will be made, (ii) there are no defaults, delinquencies or prepayments on any mortgage loan or the companion loan(s) on or prior to the closing date of this securitization transaction and (iii) each mortgage loan with an anticipated repayment date (if any) is paid in full on its related anticipated repayment date. The sum of the numerical data in any column in a table may not equal the indicated total due to rounding. Unless otherwise indicated, all figures presented in this “Summary” are calculated as described under “Description of the Mortgage Pool” in this prospectus supplement and all percentages represent the indicated percentage of the aggregate principal balance of the entire pool of mortgage loans as of the cut-off date.
When information presented in this prospectus supplement with respect to the mortgaged properties is expressed as a percentage of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, if a mortgage loan is secured by more than 1 mortgaged property, the percentages are based on an allocated loan amount that has been assigned to each of the related mortgaged properties based upon one or more of the related appraised values, the relative underwritten net cash flow or prior allocations reflected in the related mortgage loan documents as set forth on Annex A to this prospectus supplement.
With respect to any mortgage loan that is part of a loan combination, we generally present the loan-to-value ratio, debt service coverage ratio, debt yield and cut-off date balance per net rentable square foot, room or unit, as applicable, in this prospectus supplement in a manner that takes account of that mortgage loan and any related pari passu companion loan(s), but without regard to any related subordinate companion loan(s), unless otherwise indicated. Other than as specifically noted, the loan-to-value ratio, the debt service coverage ratio, debt yield and mortgage loan rate information for each mortgage loan is presented in this prospectus supplement without regard to any other indebtedness (whether or not | ||||||||||||||
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secured by the related mortgaged property, ownership interests in the related borrower or otherwise) that currently exists or that may be incurred by the related borrower or its owners in the future, in order to present statistics for the related mortgage loan without combination with the other indebtedness.
In addition, for purposes of the presentation of information in this prospectus supplement, certain loan-to-value ratio, appraised value, debt yield, debt service coverage ratio and/or cut-off date principal balance information or other underwritten statistics may be based on certain adjustments, assumptions and/or estimates, as further described under“—Additional Characteristics of the Mortgage Loans”above, and“Description of the Mortgage Pool—Certain Calculations and Definitions” and“—Statistical Characteristics of the Mortgage Loans” in this prospectus supplement.
None of the mortgage loans in the issuing entity will be cross-collateralized with any mortgage loan that is not in the issuing entity, except as described in this prospectus supplement with respect to the mortgage loans that constitute part of a loan combination and that are secured by a mortgaged property or portfolio of mortgaged properties that also secure one or more companion loans not included in the issuing entity. | |||||||||||||||
Certain Variances from Underwriting | |||||||||||||||
Standards | Except for three (3) of the mortgage loans as described under“Transaction Parties—The Originators—Citigroup Global Markets Realty Corp.” and“—The Originators—The Goldman Originators” in this prospectus supplement, all of the mortgage loans were originated substantially in accordance with the respective originators’ underwriting guidelines described under“Transaction Parties—The Originators” in this prospectus supplement. | ||||||||||||||
Mortgaged Properties with Limited | |||||||||||||||
or No Operating History | Four (4) of the mortgaged properties, securing approximately 6.9% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date by allocated loan amount, were constructed, substantially renovated, re-positioned or repurposed 12 months or less prior to the cut-off date and, therefore, have no or limited prior operating history and/or lack historical financial figures and information.
Excluding any mortgaged properties referenced by the previous paragraph, one (1) of the mortgaged properties, securing approximately 1.7% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, was acquired 12 months or less prior to the cut-off date and, therefore, lacks historical financial figures and information. | ||||||||||||||
See “Description of the Mortgage Pool—General” in this prospectus supplement. | |||||||||||||||
Certain Mortgage Loans with Material | |||||||||||||||
Lease Termination Options | Certain mortgage loans have material lease early termination options. See Annex B to this prospectus supplement for information regarding material lease termination options for the 10 largest tenants by base rent at the Mortgaged Properties securing the largest 20 mortgage loans (considering each crossed group as a single mortgage loan) by aggregate principal balance of the pool of mortgage loans as of the cut-off date. Also, see“Description of the Mortgage Pool—Tenant Issues—Lease Expirations and Terminations”in this prospectus supplement for | ||||||||||||||
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information on material tenant lease expirations and early termination options. | |||||||||||||||
Removal of Mortgage Loans | |||||||||||||||
From the Mortgage Pool | Generally, a mortgage loan may only be removed from the mortgage pool as a result of (a) a repurchase or substitution by a sponsor for any mortgage loan for which it cannot remedy the material breach (or, in certain cases, a breach that is deemed to be material) or material document defect (or, in certain cases, a defect that is deemed to be material) affecting such mortgage loan under the circumstances described in this prospectus supplement, (b) the exercise of a purchase option by a mezzanine lender, or the holder of a subordinate companion loan, in each case if any, or (c) a final disposition of a mortgage loan such as a payment in full or a sale of a defaulted mortgage loan or REO property. See“Risk Factors—Your Yield May Be Affected by Defaults, Prepayments and Other Factors—The Timing of Prepayments and Repurchases May Change Your Anticipated Yield,” “Description of the Mortgage Pool—Cures, Repurchases and Substitutions”, “Description of the Mortgage Pool—The Loan Combinations”and“The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties”in this prospectus supplement. | ||||||||||||||
The Certificates | |||||||||||||||
The Offered Certificates | |||||||||||||||
A. General | We are offering the following classes of Commercial Mortgage Pass- Through Certificates from the Series 2015-GC31: | ||||||||||||||
· | Class A-1 | ||||||||||||||
· | Class A-2 | ||||||||||||||
· | Class A-3 | ||||||||||||||
· | Class A-4 | ||||||||||||||
· | Class A-AB | ||||||||||||||
· | Class X-A | ||||||||||||||
· | Class A-S | ||||||||||||||
· | Class B | ||||||||||||||
· | Class PEZ | ||||||||||||||
· | Class C | ||||||||||||||
· | Class D | ||||||||||||||
The Series 2015-GC31 certificates will consist of the above classes, together with the following classes that are not being offered through this prospectus supplement and the prospectus: Class E, Class F, Class G, Class H, Class S and Class R certificates. | |||||||||||||||
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B. Certificate Principal | |||||||||||||||
Amounts or Notional Amounts | Subject to the discussion in the following paragraph, each class of the offered certificates will have the approximate aggregate initial certificate principal amount (or notional amount, in the case of the Class X-A certificates) set forth in the table under “Certificate Summary” in this prospectus supplement, which principal amount (or notional amount) may vary up to 5% on the closing date.
The initial certificate principal amount of each class of the Class A-S, Class B and Class C certificates shown in the table under“Certificate Summary”in this prospectus supplement represents the maximum certificate principal amount of such class without giving effect to any issuance of Class PEZ certificates. The initial certificate principal amount of the Class PEZ certificates shown in the table under“Certificate Summary” in this prospectus supplement is equal to the aggregate of the maximum initial certificate principal amounts of the Class A-S, Class B and Class C certificates, which is the maximum certificate principal amount of the Class PEZ certificates that could be issued in an exchange. The actual certificate principal amount of any class of exchangeable certificates issued on the closing date may be less than the maximum certificate principal amount of that class and may be zero. The certificate principal amounts of the Class A-S, Class B and Class C certificates to be issued on the closing date will be reduced, in required proportions, by an amount equal to the certificate principal amount of the Class PEZ certificates issued on the closing date.
The aggregate certificate principal amount of any class of principal balance certificates or trust component outstanding at any time represents the maximum amount that its holders (or, in the case of a trust component, the holders of exchangeable certificates evidencing an interest in that trust component) are entitled to receive at such time as distributions allocable to principal from the cash flow on the mortgage loans and the other assets in the issuing entity, subject to reduction as described below in this“—The Offered Certificates”section.
See“Description of the Offered Certificates—General”in this prospectus supplement. | ||||||||||||||
C. Pass-Through Rates | Each class of the offered certificates (other than the Class PEZ certificates) will accrue interest at an annual rate called a pass-through rate on the basis of a 360-day year consisting of twelve 30-day months or a “30/360 basis.” The approximate initial pass-through rate for each class of offered certificates is set forth in the table under “Certificate Summary” in this prospectus supplement. | ||||||||||||||
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For any distribution date, the pass-through rate with respect to each class of the Class B, Class C and Class D certificates will be a per annum rate equal to the weighted average of the net interest rates on the mortgage loans (in each case, adjusted, if necessary, to accrue on the basis of a 360-day year consisting of twelve 30-day months) as of their respective due dates in the month preceding the month in which the related distribution date occurs. | |||||||||||||||
· | the mortgage loan interest rates will not reflect any default interest rate, any rate increase occurring after an anticipated repayment date (if applicable), any loan term modifications agreed to by the special servicer or any modifications resulting from a borrower’s bankruptcy or insolvency; and | ||||||||||||||
· | with respect to each mortgage loan that accrues interest on the basis of the actual number of days in a month, assuming a 360-day year, the related mortgage loan interest rate (net of the administrative fee rate) for any month that is not a 30-day month will be recalculated so that the amount of interest that would accrue at that rate in that month, calculated on a 30/360 basis, will equal the amount of net interest that actually accrues on that mortgage loan in that month, adjusted for any withheld amounts and/or closing date deposits as described under“The Pooling and Servicing Agreement—Accounts” in this prospectus supplement. | ||||||||||||||
See“Description of the Offered Certificates—Distributions—Payment Priorities” in this prospectus supplement. | |||||||||||||||
D. Exchangeable Certificates / | |||||||||||||||
Exchange Proportions | If you own Class A-S, Class B and Class C certificates in an exchange proportion that we describe in this prospectus supplement, you will be able to exchange them for a proportionate interest in the Class PEZ certificates, and vice versa. You can exchange your exchangeable certificates by notifying the certificate administrator. If you own Class PEZ certificates, those certificates will entitle you to receive principal and interest in the amounts that would otherwise have been payable on the applicable proportion of Class A-S, Class B and Class C | ||||||||||||||
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certificates exchangeable for those Class PEZ certificates. Any such allocations of principal and interest as between classes of exchangeable certificates will have no effect on the principal or interest entitlements of any other class of certificates. Exchanges will be subject to various conditions that we describe in this prospectus supplement. | |||||||||||||||
See“Description of the Offered Certificates—Exchangeable Certificates” in this prospectus supplement and“Description of the Certificates—Exchangeable Certificates”in the accompanying prospectus for a description of the exchangeable certificates and exchange procedures. See also“Risk Factors—The Exchangeable Certificates Are Subject to Additional Risks” in this prospectus supplement. | |||||||||||||||
Distributions | |||||||||||||||
A. Amount and Order of | |||||||||||||||
Distributions | On each distribution date, funds available for distribution from the mortgage loans, net of specified expenses of the issuing entity, net of yield maintenance charges and prepayment premiums and net of any excess interest distributable to the Class S certificates, will be distributed in the following amounts and order of priority: | ||||||||||||||
First: Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class X-A certificates: to interest on the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class X-A certificates, up to, and pro rata in accordance with, their respective interest entitlements. | |||||||||||||||
Second: Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates: to the extent of funds allocable to principal received or advanced on the mortgage loans: | |||||||||||||||
(A) | to principal on the Class A-AB certificates until their certificate principal amount has been reduced to the Class A-AB scheduled principal balance set forth on Annex F to this prospectus supplement for the relevant distribution date; | ||||||||||||||
(B) | to principal on the Class A-1 certificates until their certificate principal amount has been reduced to zero, all remaining funds available for distribution of principal remaining after the distributions pursuant to clause (A) above; | ||||||||||||||
(C) | to principal on the Class A-2 certificates until their certificate principal amount has been reduced to zero, all remaining funds available for distribution of principal remaining after the distributions pursuant to clauses (A) and (B) above; | ||||||||||||||
(D) | to principal on the Class A-3 certificates until their certificate principal amount has been reduced to zero, all remaining funds available for distribution of principal remaining after the distributions pursuant to clauses (A) through (C) above; | ||||||||||||||
(E) | to principal on the Class A-4 certificates until their certificate principal amount has been reduced to zero, all remaining funds available for distribution of principal remaining after the distributions pursuant to clauses (A) through (D) above; and | ||||||||||||||
(F) | to principal on the Class A-AB certificates until their certificate principal amount has been reduced to zero, all remaining funds | ||||||||||||||
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available for distribution of principal remaining after the distributions pursuant to clauses (A) through (E) above. | |||||||||||||||
However, if the certificate principal amounts of each and every class of certificates other than the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates have been reduced to zero as a result of the allocation of mortgage loan losses (and other unanticipated expenses) to those certificates, funds available for distributions of principal will be distributed to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates, pro rata, based on their respective certificate principal amounts and without regard to the Class A-AB scheduled principal balance. | |||||||||||||||
Third: Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates: to reimburse the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates, pro rata, based on the aggregate unreimbursed losses, for any unreimbursed losses on the mortgage loans that were previously allocated to reduce the certificate principal amounts of those classes, together with interest. | |||||||||||||||
Fourth:Class A-S trust component: To pay amounts on the Class A-S trust component and, thus, concurrently, to the Class A-S and Class PEZ certificates as follows: (a) to interest on the Class A-S trust component (and, therefore, to the Class A-S and Class PEZ certificates pro rata based on their respective percentage interests in the Class A-S trust component) in the amount of its interest entitlement; (b) to the extent of funds allocable to principal remaining after distributions in respect of principal to each class with a higher priority (in this case, the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates), to principal on the Class A-S trust component (and, therefore, to the Class A-S and Class PEZ certificates pro rata based on their respective percentage interests in the Class A-S trust component) until its certificate principal amount has been reduced to zero; and (c) to reimburse the Class A-S trust component (and, therefore, the Class A-S and Class PEZ certificates pro rata based on their respective percentage interests in the Class A-S trust component) for any unreimbursed losses on the mortgage loans that were previously allocated to reduce the certificate principal amount of that trust component (and, therefore, those certificates), together with interest. | |||||||||||||||
Fifth: Class B trust component: To pay amounts on the Class B trust component and, thus, concurrently, to the Class B and Class PEZ certificates as follows: (a) to interest on the Class B trust component (and, therefore, to the Class B and Class PEZ certificates pro rata based on their respective percentage interests in the Class B trust component) in the amount of its interest entitlement; (b) to the extent of funds allocable to principal remaining after distributions in respect of principal to each class and trust component with a higher priority (in this case, the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S trust component), to principal on the Class B trust component (and, therefore, to the Class B and Class PEZ certificates pro rata based on their respective percentage interests in the Class B trust component) until its certificate principal amount has been reduced to zero; and (c) to reimburse the Class B trust component (and, therefore, the Class B and Class PEZ certificates pro rata based on their respective percentage interests in the Class B trust component) for any unreimbursed losses on the mortgage loans that were previously allocated to reduce the certificate principal amount of that trust component (and, therefore, those certificates), together with interest. | |||||||||||||||
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Sixth:Class C trust component: To pay amounts on the Class C trust component and, thus, concurrently, to the Class C and Class PEZ certificates as follows: (a) to interest on the Class C trust component (and, therefore, to the Class C and Class PEZ certificates pro rata based on their respective percentage interests in the Class C trust component) in the amount of its interest entitlement; (b) to the extent of funds allocable to principal remaining after distributions in respect of principal to each class and trust component with a higher priority (in this case, the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S and Class B trust components), to principal on the Class C trust component (and, therefore, to the Class C and Class PEZ certificates pro rata based on their respective percentage interests in the Class C trust component) until its certificate principal amount has been reduced to zero; and (c) to reimburse the Class C trust component (and, therefore, the Class C and Class PEZ certificates pro rata based on their respective percentage interests in the Class C trust component) for any unreimbursed losses on the mortgage loans that were previously allocated to reduce the certificate principal amount of that trust component (and, therefore, those certificates), together with interest. | |||||||||||||||
Seventh: Class D certificates: To pay amounts on the Class D certificates as follows: (a) to interest on the Class D certificates in the amount of their interest entitlement; (b) to the extent of funds allocable to principal remaining after distributions in respect of principal to each class and trust component with a higher priority (in this case, the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S, Class B and Class C trust components), to principal on the Class D certificates until their certificate principal amount has been reduced to zero; and (c) to reimburse the Class D certificates for any unreimbursed losses on the mortgage loans that were previously allocated to reduce the certificate principal amount of the Class D certificates, together with interest. | |||||||||||||||
Eighth: Non-offered certificates: in the amounts and order of priority described in“Description of the Offered Certificates—Distributions—Payment Priorities”in this prospectus supplement. | |||||||||||||||
For more information, see“Description of the Offered Certificates—Distributions—Payment Priorities” in this prospectus supplement. | |||||||||||||||
B. Interest and Principal | |||||||||||||||
Entitlements | A description of each class’s and trust component’s interest entitlement can be found in“Description of the Offered Certificates—Distributions—Method, Timing and Amount” and“—Distributions—Payment Priorities” in this prospectus supplement. As described in that section, there are circumstances in which your interest entitlement for a distribution date could be less than one full month’s interest at the related pass-through rate on your certificate’s principal amount or notional amount (or, in the case of the Class PEZ certificates, the related pass-through rates on the applicable percentage interest of the related certificate principal amounts of the Class A-S, Class B and Class C trust components). | ||||||||||||||
On each distribution date, the Class PEZ certificates will be entitled to receive a proportionate share of the amounts distributable on the Class A-S, Class B and Class C trust components, and therefore, of the amounts that would otherwise have been distributed as interest and principal payments on the Class A-S, Class B and Class C certificates had an exchange not occurred, as described under “Description of the | |||||||||||||||
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Offered Certificates—Exchangeable Certificates” in this prospectus supplement. Any such allocations of principal and interest as between the Class PEZ certificates, on the one hand, and the Class A-S, Class B and Class C certificates, on the other, will have no effect on the principal or interest entitlements of any other class of certificates. | |||||||||||||||
A description of the amount of principal required to be distributed to the classes entitled to principal on a particular distribution date also can be found in“Description of the Offered Certificates—Distributions—Method, Timing and Amount” and“—Distributions—Payment Priorities” in this prospectus supplement. | |||||||||||||||
C. Servicing and Administrative | |||||||||||||||
Fees | The master servicer and special servicer are entitled to a master servicing fee and a special servicing fee, respectively, generally from the interest payments on the mortgage loans (or any serviced loan combinations, if applicable) in the case of the master servicer, and from the collection account in the case of the special servicer;provided, that the special servicer for this securitization transaction (acting in such capacity) will not receive any special servicing fee with respect to any outside serviced mortgage loan. The master servicing fee for each distribution date will be calculated based on: (i) the stated principal balance of each mortgage loan in the issuing entity and each serviced companion loan; and (ii) the related master servicing fee rate, which includes any sub-servicing fee and primary servicing fee and ranges on a loan-by-loan basis from 0.0050% to 0.0725% per annum. The master servicing fee rate includes (a) any sub-servicing fee rate and primary servicing fee rate, and (b) with respect to an outside serviced mortgage loan, the servicing fee rate payable to the outside servicer. The special servicing fee for each distribution date is calculated based on the stated principal balance of each specially serviced loan or REO loan (that is not part of an outside serviced loan combination) and the special servicing fee rate, which is equal to the greater of 0.25% per annum and the rate that would result in a special servicing fee of $3,500 for the related month. | ||||||||||||||
The master servicer and special servicer are also entitled to additional fees and amounts, including income on the amounts held in permitted investments to the extent specified in this prospectus supplement and the pooling and servicing agreement. In addition, the special servicer is entitled to (a) liquidation fees from (and generally calculated at a rate of 1.0% applied to) the recovery of liquidation proceeds, insurance proceeds, condemnation proceeds and other payments in connection with a full or discounted payoff of a specially serviced loan or REO loan (that is not part of an outside serviced loan combination) and (b) workout fees from (and generally calculated at a rate of 1.0% applied to) collections on any mortgage loan or companion loan serviced under the pooling and servicing agreement for this securitization transaction, that had previously been a specially serviced loan, but had been worked out, in each case net of certain amounts and calculated as further described under“Transaction Parties—Servicing Compensation, Operating Advisor Compensation and Payment of Expenses” in this prospectus supplement. The outside special servicer for any outside serviced mortgage loan will be entitled to receive comparable (but not necessarily identical) special servicing fees, liquidation fees and workout fees and other additional fees and amounts with respect to that outside serviced mortgage loan pursuant to the terms of the applicable outside servicing agreement. | |||||||||||||||
S-50 |
The operating advisor is entitled to a fee from general collections on the mortgage loans for each distribution date, calculated based on the outstanding principal balance of each mortgage loan in the issuing entity and the operating advisor fee rate of 0.0013% per annum. The operating advisor is also entitled to a consulting fee with respect to each major decision as to which the operating advisor has consultation rights, which will be a fee for each such major decision equal to $10,000 or such lesser amount as the related borrower agrees to pay with respect to the subject serviced mortgage loan (or serviced loan combination, if applicable). | |||||||||||||||
In addition, the master servicer will pay to the Commercial Real Estate Finance Council (“CREFC®”) an intellectual property royalty license fee in connection with the use of CREFC® names and trademarks from general collections on the mortgage loans for each distribution date, calculated based on the stated principal balance of each mortgage loan in the issuing entity at the intellectual royalty license fee rate of 0.0005% per annum. | |||||||||||||||
The fees of the trustee and the certificate administrator will be payable monthly from general collections on the mortgage loans for each distribution date, calculated on the outstanding principal balance of the pool of mortgage loans in the issuing entity and the trustee/certificate administrator fee rate of 0.0034% per annum. | |||||||||||||||
Each of the master servicing fee, the special servicing fee, the operating advisor fee, the CREFC® intellectual property royalty license fee and the trustee/certificate administrator fee will be calculated on the same interest accrual basis as the related mortgage loan (or any related serviced companion loan) and prorated for any partial period. See“Transaction Parties—Servicing Compensation, Operating Advisor Compensation and Payment of Expenses” in this prospectus supplement. | |||||||||||||||
The administrative fee rate will be the sum of the master servicing fee rate (which, with respect to each outside serviced mortgage loan, includes the per annum servicing fee rate payable to the outside servicer), the operating advisor fee rate, the CREFC® intellectual property royalty license fee rate and the trustee/certificate administrator fee rate and is set forth on Annex A to this prospectus supplement for each mortgage loan. | |||||||||||||||
The master servicing fees, the special servicing fees, the liquidation fees, the workout fees, the operating advisor fees, the CREFC® intellectual property royalty license fee, and the trustee/certificate administrator fees will be paid prior to distributions to certificateholders of the available distribution amount as described under“The Pooling and Servicing Agreement—Withdrawals from the Collection Account”and“Description of the Offered Certificates—Distributions—Method, Timing and Amount”in this prospectus supplement. | |||||||||||||||
See“Transaction Parties—Servicing Compensation, Operating Advisor Compensation and Payment of Expenses”and“The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement. | |||||||||||||||
D. Prepayment Premiums | The manner in which any prepayment premiums and yield maintenance charges received prior to the related determination date will be allocated on each distribution date to the Class X-A certificates, on the one hand, and certain of the classes of certificates and trust components entitled to principal, on the other hand, is described in “Description of the Offered | ||||||||||||||
S-51 |
Certificates—Distributions—Prepayment Premiums” in this prospectus supplement. | |||||||||||||||
E. Excess Interest | On each distribution date, any excess interest collected from time to time in respect of the one (1) mortgage loan in the issuing entity with an anticipated repayment date will be distributed to the holders of the Class S certificates, which are not offered by this prospectus supplement. This interest will not be available to provide credit support for other classes of certificates or to offset any interest shortfalls. See“Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—ARD Loans” in this prospectus supplement. | ||||||||||||||
Advances | |||||||||||||||
A. Principal and Interest Advances | The master servicer is required to advance delinquent monthly debt service payments with respect to each mortgage loan in the issuing entity (including the outside serviced mortgage loans) but not any companion loan(s), as described below under“—Property Advances on the Outside Serviced Loan Combinations,” if it determines that the advance will be recoverable from collections on that mortgage loan. The master servicer will not be required to advance amounts deemed non-recoverable from related loan collections. The master servicer will not be required or permitted to make an advance for balloon payments, default interest, excess interest, any other interest in excess of a mortgage loan’s regular interest rate, prepayment premiums or yield maintenance charges or delinquent monthly debt service payments on the companion loan(s). In the event that the master servicer fails to make any required advance, the trustee will be required to make that advance unless the trustee determines that the advance is non-recoverable from related loan collections. See“The Pooling and Servicing Agreement—Advances” in this prospectus supplement. If an advance is made, the master servicer will not advance its servicing fee, but will advance the certificate administrator’s fee, the trustee’s fee, the operating advisor’s fee and the CREFC® intellectual property royalty license fee. The master servicer or trustee, as applicable, will be entitled to reimbursement from general collections on the mortgage loans for advances determined to be non-recoverable from related loan collections. This may result in losses on your certificates. | ||||||||||||||
B. Property Protection Advances | The master servicer also is required to make advances to pay delinquent real estate taxes and assessments, ground lease rent payments, condominium assessments, hazard insurance premiums and similar expenses necessary to protect and maintain the mortgaged property, to maintain the lien on the mortgaged property or enforce the related mortgage loan documents with respect to the mortgage loans and any companion loans (other than those that are part of an outside serviced loan combination), unless the advance is determined to be non-recoverable from related loan proceeds. In the event that the master servicer fails to make a required advance of this type, the trustee will be required to make that advance unless the trustee determines that the advance is non-recoverable from related loan collections. The master servicer is not required, but in certain circumstances is permitted, to advance amounts deemed non-recoverable from related loan collections. See“The Pooling and Servicing Agreement—Advances” in this prospectus supplement. The master servicer or trustee, as applicable will be entitled to reimbursement from general collections on the mortgage loans for advances determined to be non-recoverable from related loan collections. This may result in losses on your certificates. | ||||||||||||||
S-52 |
C. Interest on Advances | The master servicer and the trustee, as applicable, will be entitled to interest on all advances as described in this prospectus supplement. Interest accrued on outstanding advances may result in reductions in amounts otherwise payable on the certificates. No interest will accrue on advances with respect to principal or interest due on a mortgage loan until any grace period applicable to that mortgage loan has expired. | ||||||||||||||
The master servicer and the trustee will each be entitled to receive interest on advances they make at the prime rate, compounded annually. If the interest on an advance is not recovered from default interest or late payments on the mortgage loan, a shortfall will result which will have the same effect as a liquidation loss on a defaulted mortgage loan. | |||||||||||||||
See“Description of the Offered Certificates—Distributions—Realized Losses”and“The Pooling and Servicing Agreement—Advances”in this prospectus supplement. | |||||||||||||||
D. Property Advances on the | |||||||||||||||
Outside Serviced Loan | |||||||||||||||
Combinations | With respect to each outside serviced loan combination, the outside servicer under the related outside servicing agreement is required to make property protection advances with respect to the related mortgaged property or properties, unless that outside servicer determines that those advances would not be recoverable from collections on such outside serviced loan combination. If that outside servicer is required to but fails to make a required property protection advance, then (subject to a recoverability determination) the outside trustee will be required to make that property protection advance. The outside servicer and/or the outside trustee, to the extent it makes any property protection advances with respect to an outside serviced loan combination, will be entitled to receive interest on such advances in accordance with the terms of the applicable outside servicing agreement and the related co-lender agreement, which may be reimbursable out of general collections of the issuing entity. The advancing party will also be entitled to reimbursement from general collections on the mortgage loans in the issuing entity for the pro rata share allocable to the applicable outside serviced mortgage loan of any non-recoverable property protection advance made by it on the related outside serviced loan combination and interest on those advances. | ||||||||||||||
No outside servicer is required to advance delinquent monthly mortgage loan payments with respect to the related outside serviced mortgage loan. | |||||||||||||||
Priority of Payments | |||||||||||||||
A. Subordination / Allocation | |||||||||||||||
of Losses | The amount available for distribution will be applied in the order described in“—Distributions—Amount and Order of Distributions”above. | ||||||||||||||
The following chart generally describes the manner in which the payment rights of certain classes of certificates and trust components will be senior or subordinate, as the case may be, to the payment rights of other classes of certificates and trust components. The chart shows entitlement to receive principal and interest (other than excess interest that accrues on a mortgage loan that has an anticipated repayment date (if any)) on any distribution date in descending order (beginning with the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class X-A certificates). Among the Class A-1, Class A-2, Class A-3, Class A-4, | |||||||||||||||
S-53 |
Class A-AB and Class X-A certificates, payment rights of certain classes will be more particularly described in “Description of the Offered Certificates—Distributions”in this prospectus supplement. It also shows the manner in which mortgage loan losses are allocated in ascending order (beginning with certain Series 2015-GC31 certificates that are not being offered by this prospectus supplement). Principal losses on the mortgage loans allocated to a class of certificates or trust component will reduce the related certificate principal amount of that class or trust component. However, no such principal losses will be allocated to the Class S, Class R or Class X-A certificates, although loan losses will reduce the notional amount of the Class X-A certificates (to the extent such losses are allocated to the Class A-1, Class A-2, Class A-3, Class A-4 or Class A-AB certificates or the Class A-S trust component), and, therefore, the amount of interest they accrue. | |||||||||||||||
* | Interest only certificates. No principal payments or realized loan losses in respect of principal will be allocated to the Class X-A certificates. However, mortgage loan losses will reduce the notional amount of the Class X-A certificates, in each case, to the extent such losses reduce the certificate principal amount of a related class of principal balance certificates or a related trust component. | ||||||||||||||
** | Distributions and losses allocated to a trust component will be concurrently allocated to the related classes of exchangeable certificates that evidence a percentage interest in such trust component. Distributions of principal and interest and allocations of mortgage loan losses to the Class A-S trust component will be made pro rata to the Class A-S certificates and the Class PEZ certificates in proportion to their respective percentage interests in the Class A-S trust component. Distributions of principal and interest and allocations of mortgage loan losses to the Class B trust | ||||||||||||||
S-54 |
component will be made pro rata to the Class B certificates and the Class PEZ certificates in proportion to their respective percentage interests in the Class B trust component. Distributions of principal and interest and allocations of mortgage loan losses to the Class C trust component will be made pro rata to the Class C certificates and the Class PEZ certificates in proportion to their respective percentage interests in the Class C trust component. See “Description of the Offered Certificates—Distributions”in this prospectus supplement. | |||||||||||||||
*** | Other than the Class S and Class R certificates. | ||||||||||||||
No other form of credit enhancement will be available for the benefit of the holders of the offered certificates. | |||||||||||||||
See“Description of the Offered Certificates—Subordination”in this prospectus supplement. | |||||||||||||||
To the extent funds are available on a subsequent distribution date for distribution on your offered certificates, you will be reimbursed for any losses allocated to your offered certificates (or, in the case of the Class PEZ certificates, allocated to the percentage interests evidenced thereby in the Class A-S, Class B and/or Class C trust components, as applicable) with interest at the pass-through rate on those offered certificates or trust components. | |||||||||||||||
B. Shortfalls in Available Funds | In addition to losses caused by mortgage loan defaults, shortfalls in payments to holders of certificates may occur as a result of: the master servicer’s and trustee’s right to receive payments of interest on unreimbursed advances (to the extent not covered by default interest and late payment charges or other amounts collected from borrowers that are not paid to the master servicer or the special servicer as compensation, to the extent described in this prospectus supplement); the special servicer’s right to compensation with respect to mortgage loans which are or have been serviced by the special servicer; the rights of any outside servicer, outside trustee and/or outside special servicer to receive payments of interest on unreimbursed property protection advances, servicing and/or special servicing compensation and/or reimbursement of certain amounts with respect to an outside serviced loan combination in accordance with the related co-lender agreement and the applicable outside servicing agreement; a modification of a mortgage loan’s interest rate or principal balance; or other unanticipated expenses of the issuing entity. These shortfalls, if they occur, would reduce distributions to the classes of certificates or trust components with the lowest payment priorities. In addition, prepayment interest shortfalls that are not covered by certain compensating interest payments made by the master servicer are required to be allocated to the interest-bearing certificates (other than the Class A-S, Class B, Class PEZ and Class C certificates) and the trust components (and, therefore, the Class A-S, Class B, Class PEZ and Class C certificates), on a pro rata basis, to reduce the amount of the interest payment on such classes of certificates and trust components. | ||||||||||||||
S-55 |
Additional Aspects of the Certificates | |||||||||||||||
A. Information Available to | |||||||||||||||
Certificateholders | On each distribution date, the certificate administrator will prepare and make available to each certificateholder a statement as to the distributions being made on that date. Additionally, under certain circumstances, certificateholders may be entitled to certain other information regarding the issuing entity. See “The Pooling and Servicing Agreement—Reports to Certificateholders; Available Information” in this prospectus supplement. | ||||||||||||||
B. Optional Termination | On any distribution date on which the aggregate unpaid principal balance of the mortgage loans remaining in the issuing entity is less than 1.0% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, certain specified persons will have the option to purchase all of the mortgage loans (and all property acquired through exercise of remedies in respect of any mortgage loan) remaining in the issuing entity at the price specified in this prospectus supplement. Exercise of this option will terminate the issuing entity and retire the then outstanding certificates. | ||||||||||||||
C. Required Repurchase or | |||||||||||||||
Substitution of Mortgage Loans | Under the circumstances described in this prospectus supplement, the applicable sponsor (or RAIT Financial Trust, as guarantor of the repurchase and substitution obligations of RAIT Funding, LLC, or KGS Holdings, L.P., as guarantor of the repurchase and substitution obligations of KGS-Alpha Real Estate Capital Markets, LLC) will be required to repurchase or substitute for any mortgage loan for which it cannot remedy a breach of a representation and warranty or a document defect, that, in each case, materially and adversely affects (or is deemed to materially and adversely affect) the value of that mortgage loan (or related REO property) or the interests of the certificateholders in that mortgage loan. See “Description of the Mortgage Pool—Cures, Repurchases and Substitutions” in this prospectus supplement. | ||||||||||||||
D. Sale of Defaulted Mortgage | |||||||||||||||
Loans and REO Properties | Pursuant to the pooling and servicing agreement, the special servicer is required to solicit offers for defaulted mortgage loans serviced thereunder (or, in the case of such a defaulted mortgage loan that is included in a serviced pari passu loan combination, such defaulted mortgage loan and any related serviced pari passu companion loan(s)) and related REO properties and accept the first (and, if multiple offers are received, the highest) cash offer from any person that constitutes a fair price for the defaulted serviced mortgage loan (or defaulted serviced pari passu loan combination or relevant portion thereof, if applicable) or | ||||||||||||||
S-56 |
related REO property, determined as described in “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties” in this prospectus supplement, unless the special servicer determines, in accordance with the servicing standard, that rejection of such offer would be in the best interests of the certificateholders and any related affected companion loan holder(s) (as a collective whole as if such certificateholders and such serviced pari passu companion loan holder constituted a single lender). | |||||||||||||||
If a mortgage loan that is part of a serviced pari passu loan combination (if any) becomes a defaulted mortgage loan, and if the special servicer decides to sell such defaulted mortgage loan as described in the prior paragraph, then the special servicer will be required to sell any related serviced pari passu companion loan(s) together with such defaulted mortgage loan as a single whole loan. In connection with any such sale, the special servicer will be required to follow the procedures set forth under “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties” in this prospectus supplement.
Pursuant to the co-lender agreement with respect to each serviced AB loan combination, the holder of such subordinate companion loan has a right to purchase the related defaulted mortgage loan (together with any related serviced pari passu companion loan) as described in “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement.
Pursuant to the related outside servicing agreement, the party acting as outside special servicer with respect to any outside serviced loan combination may offer to sell to any person (or may offer to purchase) for cash such outside serviced loan combination during such time as such loan combination constitutes a defaulted mortgage loan under the related outside servicing agreement and, in connection with any such sale, the outside special servicer is required to sell both the related outside serviced mortgage loan and the related pari passu companion loan(s) as a single whole loan.
Pursuant to each mezzanine loan intercreditor agreement with respect to the mortgage loans with mezzanine indebtedness, the holder of the related mezzanine loan has the right to purchase the related mortgage loan as described in “Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness” in this prospectus supplement. Additionally, in the case of mortgage loans that permit certain equity owners of the borrower to incur future mezzanine debt as described in “Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness” in this prospectus supplement, the related mezzanine lender may have the option to purchase the related mortgage loan after certain defaults.
See “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties” and “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement. | |||||||||||||||
S-57 |
E. Registration and | |||||||||||||||
Denominations | The offered certificates will be issued in book-entry form through The Depository Trust Company, or DTC, and its participants. You may hold your certificates through: (i) DTC in the United States; or (ii) Clearstream Banking, société anonyme or Euroclear Bank, as operator of the Euroclear System, in Europe. Transfers within DTC, Clearstream Banking, société anonyme or Euroclear Bank, as operator of the Euroclear System, will be made in accordance with the usual rules and operating procedures of those systems. See “Description of the Offered Certificates—Delivery, Form, Transfer and Denomination—Book-Entry Registration”in this prospectus supplement and “Description of the Certificates—Book-Entry Registration”in the prospectus. All the offered certificates will be issued in registered form without coupons. The offered certificates (other than the Class X-A certificates) that are initially offered and sold will be issued in minimum denominations of $10,000 and integral multiples of $1 in excess of $10,000. The Class X-A certificates will be issued in minimum denominations of an authorized initial notional amount of not less than $1,000,000 and in integral multiples of $1 in excess of $1,000,000. | ||||||||||||||
Other Investment Considerations | |||||||||||||||
Potential Conflicts of Interest | The relationships involving the parties to this transaction and/or the securitization of any related companion loan, and the activities of those parties or their affiliates, may give rise to certain conflicts of interest. These conflicts of interests may arise from, among other things, the following relationships and activities: | ||||||||||||||
· | the ownership of any certificates by the depositor, any sponsor, any originator, any underwriter, the master servicer, the special servicer, the operating advisor, any outside servicer, any outside special servicer, any outside operating advisor or any of their respective affiliates; | ||||||||||||||
· | the ownership of, or any interests in, or securities backed by, any companion loans or mezzanine debt by any sponsor, any originator, any underwriter, the master servicer, the special servicer, the operating advisor, any outside servicer, any outside special servicer, any outside operating advisor or any of their respective affiliates; | ||||||||||||||
· | the relationships, including financial dealings, of any sponsor, any originator, the master servicer, the special servicer, the operating advisor, any outside servicer, any outside special servicer, any outside operating advisor or any of their respective affiliates with any borrower, any non-recourse carveout guarantor or any of their respective affiliates; | ||||||||||||||
· | the relationships, including financial dealings, of the sponsors, any originator, the underwriters and their respective affiliates with each other; | ||||||||||||||
· | the decision or obligation of the special servicer to take actions at the direction or recommendation of the applicable directing holder or the holder of any serviced companion loan or its representative; | ||||||||||||||
· | the expected initial controlling class representative’s engagement of any party to this securitization transaction as an independent | ||||||||||||||
S-58 |
contractor to conduct due diligence with respect to certain underlying mortgage loans; | |||||||||||||||
· | fee-sharing arrangements between one or more certificateholders or their respective representative and the special servicer; | ||||||||||||||
· | the broker-dealer activities of the underwriters and their affiliates, including taking long or short positions in the certificates or entering into credit derivative transactions with respect to the certificates; | ||||||||||||||
· | the opportunity of the initial investor in the Class E, Class F, Class G and Class H certificates to request the removal or re-sizing of or other changes to the features of some or all of the mortgage loans or to receive price adjustments or cost mitigation arrangements in connection with accepting certain mortgage loans in the mortgage pool; and | ||||||||||||||
· | the activities of the master servicer, special servicer, operating advisor, sponsors, originators or any of their respective affiliates in connection with any other transaction and, with respect to any outside serviced loan combination, the activities of any related outside servicer, outside special servicer, outside operating advisor or any of their respective affiliates in connection with any other transaction. | ||||||||||||||
See “Risk Factors—Interests and Incentives of the Originators, the Sponsors and Their Affiliates May Not Be Aligned with Your Interests,” “—Interests and Incentives of the Underwriter Entities May Not Be Aligned with Your Interests,” “—Potential Conflicts of Interest of the Master Servicer, the Special Servicer, the Trustee, any Outside Servicer and any Outside Special Servicer,” “—Potential Conflicts of Interest of the Operating Advisor,” “—Potential Conflicts of Interest of a Directing Holder, any Outside Controlling Class Representative and any Companion Loan Holder,” “—Potential Conflicts of Interest in the Selection of the Underlying Mortgage Loans,” “—Other Potential Conflicts of Interest May Affect Your Investment,” “—Rights of the Directing Holder and the Operating Advisor Could Adversely Affect Your Investment,” “—Loan Combinations Pose Special Risks—Realization on the Mortgage Loan That Is Part of a Serviced Loan Combination May Be Adversely Affected by the Rights of the Related Serviced Companion Loan Holder,” and “—Loan Combinations Pose Special Risks—Rights of any Outside Controlling Class Representative Under any Outside Servicing Agreement Could Adversely Affect Your Investment” in this prospectus supplement. | |||||||||||||||
Material Federal Income | |||||||||||||||
Tax Consequences | Two (2) separate real estate mortgage investment conduit (commonly known as a REMIC) elections will be made with respect to the assets of the issuing entity. The designations for each REMIC created under the pooling and servicing agreement (each, a “Trust REMIC”) are as follows: | ||||||||||||||
· | The lower-tier REMIC (the “Lower-Tier REMIC”) will hold the mortgage loans (excluding any post-anticipated repayment date excess interest) and certain other assets of the issuing entity and will issue certain classes of uncertificated regular interests to a second REMIC (the “Upper-Tier REMIC”). | ||||||||||||||
S-59 |
· | The Upper-Tier REMIC will hold the Lower-Tier REMIC regular interests and will issue the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB, Class X-A, Class D, Class E, Class F, Class G and Class H certificates and the Class A-S, Class B and Class C trust components as classes of regular interests in the Upper-Tier REMIC. | ||||||||||||||
The portions of the issuing entity consisting of the Class A-S, Class B and Class C trust components and the related distribution account, beneficial ownership of which is represented by the Class A-S, Class B, Class PEZ and Class C certificates, will be treated as a grantor trust for federal income tax purposes, as further described under “Material Federal Income Tax Consequences” in this prospectus supplement. | |||||||||||||||
Pertinent federal income tax consequences of an investment in the offered certificates include: | |||||||||||||||
· | Each class of offered certificates (other than the exchangeable certificates) and the trust components will constitute REMIC “regular interests”. | ||||||||||||||
· | The offered certificates (other than the exchangeable certificates) and the trust components will be treated as newly originated debt instruments for federal income tax purposes. | ||||||||||||||
· | Each class of exchangeable certificates will evidence beneficial ownership of one or more trust components which will be treated as a grantor trust for federal income tax purposes. | ||||||||||||||
· | You will be required to report income on your offered certificates in accordance with the accrual method of accounting. | ||||||||||||||
It is anticipated, for federal income tax purposes, that the Class C trust component and the Class X-A and Class D certificates will be issued with original issue discount, and that the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S and Class B trust components will be issued at a premium. | |||||||||||||||
In addition, the portion of the issuing entity representing the excess interest accrued on the mortgage loans with an anticipated repayment date will be treated as a grantor trust for federal income tax purposes, and the Class S certificates (which are not offered by this prospectus supplement) will represent undivided beneficial interests in such grantor trust. | |||||||||||||||
See “Material Federal Income Tax Consequences” in this prospectus supplement. | |||||||||||||||
Yield Considerations | You should carefully consider the matters described under “Risk Factors—Your Yield May Be Affected by Defaults, Prepayments and Other Factors” and “Yield, Prepayment and Maturity Considerations” in this prospectus supplement, which may affect significantly the yields on your investment. | ||||||||||||||
S-60 |
ERISA Considerations | Fiduciaries of employee benefit plans subject to the Employee Retirement Income Security Act of 1974, as amended, commonly known as ERISA, or plans subject to Section 4975 of the Internal Revenue Code of 1986, as amended, or governmental plans (as defined in Section 3(32) of ERISA) and other plans that are subject to any federal, state or local law which is, to a material extent, similar to the fiduciary or prohibited transaction provisions of ERISA or the Internal Revenue Code of 1986, as amended, should carefully review with their legal advisors whether the purchase or holding of the offered certificates could give rise to a transaction prohibited or not otherwise permissible under ERISA, the Internal Revenue Code of 1986, as amended, or similar law. | ||||||||||||||
The U.S. Department of Labor has granted substantially identical administrative exemptions to a predecessor of Citigroup Global Markets Inc., Prohibited Transaction Exemption (“PTE”) 91-23 (April 18, 1991), and to Goldman, Sachs & Co., PTE 89-88 (October 17, 1989), both as amended by PTE 2013-08 (July 9, 2013) (collectively, the “Underwriter Exemption”), which may exempt from the application of certain of the prohibited transaction provisions of Section 406 of ERISA and the excise taxes imposed on such prohibited transactions by Sections 4975(a) and (b) of the Internal Revenue Code of 1986, as amended, transactions relating to the purchase, sale and holding of pass-through certificates underwritten by a selling group of which Citigroup Global Markets Inc. or Goldman, Sachs & Co. serves as a manager or co-manager, and the servicing and operation of related mortgage pools, so long as certain conditions are met. See “ERISA Considerations” in this prospectus supplement. | |||||||||||||||
Ratings | It is a condition to the issuance of the offered certificates that each class of offered certificates receives an investment grade rating from one or more nationally recognized statistical rating organizations engaged by the depositor to rate the offered certificates. | ||||||||||||||
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Credit ratings referenced throughout this prospectus supplement are forward-looking opinions about credit risk and express a rating agency’s opinion about the willingness and ability of an issuer of securities to meet its financial obligations in full and on time. Ratings are not indications of investment merit and are not buy, sell or hold recommendations, a measure of asset value or an indication of the suitability of an investment. Any rating agency that rates the certificates may, in its discretion, lower or withdraw its rating at any time as to any class of certificates. None of the relevant parties (including, without limitation, the issuing entity, the depositor, the sponsors, the servicers, the certificate administrator, the trustee, the operating advisor and their affiliates) will be required to monitor any changes to any ratings on the certificates.
A securities rating on mortgage pass-through certificates addresses credit risk and the likelihood of full and timely payment to the applicable certificateholders of all distributions of interest at the applicable pass-through rate on the certificates or related trust component(s) in question on each distribution date and, except in the case of the interest-only certificates, the ultimate payment in full of the certificate principal amount of each class of certificates in question on a date that is not later than the rated final distribution date with respect to such class of certificates. Any security rating assigned to the offered certificates should be evaluated independently of any other security rating. A securities rating on mortgage pass-through certificates does not address the tax attributes of the certificates in question or the receipt of any default interest or prepayment premium or constitute an assessment of the likelihood, | |||||||||||||||
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timing or frequency of prepayments on the related mortgage loans. A securities rating on mortgage pass-through certificates does not address the frequency of prepayments (whether voluntary or involuntary) on the related mortgage loans, the degree to which the prepayments might differ from those originally anticipated, the yield to maturity that purchasers may experience as a result of the rate of principal prepayments, the likelihood of collection of default interest, excess interest, late payment charges, prepayment premiums or yield maintenance charges, or the tax treatment of the certificates in question.
Nationally recognized statistical rating organizations that were not engaged by the depositor to rate the offered certificates may nevertheless issue unsolicited credit ratings on one or more classes of offered certificates, relying on information they receive pursuant to Rule 17g-5 under the Securities Exchange Act of 1934, as amended, or otherwise. If any such unsolicited ratings are issued, we cannot assure you that they will not be different from any ratings assigned by a rating agency engaged by the depositor. The issuance of unsolicited ratings by any nationally recognized statistical rating organization on a class of the offered certificates that are lower than ratings assigned by the rating agencies engaged by the depositor may adversely impact the liquidity, market value and regulatory characteristics of that class. As part of the process of obtaining ratings for the offered certificates, the depositor had initial discussions with and submitted certain materials to five nationally recognized statistical rating organizations. Based on preliminary feedback from those nationally recognized statistical rating organizations at that time, the depositor selected three of those nationally recognized statistical rating organizations to rate the offered certificates (or, in the case of any particular nationally recognized statistical rating organization so selected, certain classes of the offered certificates) but not the others, due in part to their initial subordination levels for the various classes of the offered and non-offered certificates. Had the depositor selected alternative nationally recognized statistical rating organizations to rate the offered certificates, we cannot assure you as to the ratings that such other nationally recognized statistical rating organizations would have ultimately assigned to the offered certificates. In the case of one of the three nationally recognized statistical rating organizations selected by the depositor, the depositor has requested ratings for only certain classes of the offered certificates, due in part to the initial subordination levels provided by such nationally recognized statistical rating organization for the various classes of the offered certificates. If the depositor had selected such nationally recognized statistical rating organization to rate the remaining classes of offered certificates not rated by it, its ratings of such certificates may have been different, and potentially lower, than those ratings ultimately assigned to such certificates by the other nationally recognized statistical rating organizations engaged to rate such certificates. Although unsolicited ratings may be issued by any nationally recognized statistical rating organization, a nationally recognized statistical rating organization might be more likely to issue an unsolicited rating if it was not selected after having provided preliminary feedback to the depositor.
Neither the depositor nor any other person or entity will have any duty to notify you if any nationally recognized statistical rating organization issues, or delivers notice of its intention to issue, unsolicited ratings on | |||||||||||||||
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one or more classes of offered certificates after the date of this prospectus supplement. In no event will rating agency confirmations from any nationally recognized statistical rating organization (other than the engaged rating agencies or, in the case of any outside serviced loan combination, the rating agencies engaged by the depositor for the securitization of the related outside serviced companion loan) be a condition to any action, or the exercise of any right, power or privilege by any person or entity under the pooling and servicing agreement.
Furthermore, the Securities and Exchange Commission may determine that any or all of the rating agencies engaged by the depositor no longer qualify as a nationally recognized statistical rating organization or are no longer qualified to rate the offered certificates, and that determination also may have an adverse effect on the liquidity, market value and regulatory characteristics of the offered certificates. | |||||||||||||||
A security rating does not represent any assessment of the yield to maturity that investors may experience or the possibility that the holders of the Class X-A certificates might not fully recover their initial investment in the event of delinquencies or defaults, prepayments (both voluntary (to the extent permitted) and involuntary), or losses in respect of the mortgage loans. As described in this prospectus supplement, the amounts payable with respect to the Class X-A certificates consist only of interest. | |||||||||||||||
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Legal Investment | No class of the offered certificates will constitute “mortgage related securities” for purposes of the Secondary Mortgage Market Enhancement Act of 1984, as amended. If your investment activities are subject to legal investment laws and regulations, regulatory capital requirements, or review by regulatory authorities, then you may be subject to restrictions on investment in the offered certificates. You should consult your own legal advisors for assistance in determining the suitability of and consequences to you of the purchase, ownership, and sale of the offered certificates. See “Legal Investment” in this prospectus supplement and in the prospectus. | ||||||||||||||
The issuing entity will be relying on an exclusion or exemption from the definition of “investment company” under the Investment Company Act contained in Section 3(c)(5) of the Investment Company Act or Rule 3a-7 under the Investment Company Act, although there may be additional exclusions or exemptions available to the issuing entity. The issuing entity is being structured so as not to constitute a “covered fund” for purposes of the Volcker Rule under the Dodd-Frank Act (both as defined in “Risk Factors—Legal and Regulatory Provisions Affecting Investors Could Adversely Affect the Liquidity of the Offered Certificates” in this prospectus supplement). | |||||||||||||||
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Risk Factors
You should carefully consider the following risks and the risks described in “Risk Factors” in the prospectus before making an investment decision. In particular, distributions on your certificates will depend on payments received on, and other recoveries with respect to the mortgage loans. Therefore, you should carefully consider the risk factors relating to the mortgage loans and the mortgaged properties.
If any of the following events or circumstances identified as risks actually occur or materialize, your investment could be materially and adversely affected. We note that additional risks and uncertainties not presently known to us may also impair your investment.
If you are considering an investment in a class of exchangeable certificates you should carefully consider the risks that are specifically applicable to the related class(es) of certificates exchangeable therefor, since they would generally apply to your certificates if you make an exchange.
This prospectus supplement also contains forward-looking statements that involve risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including the risks described below and elsewhere in this prospectus supplement.
The Offered Certificates May Not Be a Suitable Investment for You
The offered certificates are not suitable investments for all investors. In particular, you should not purchase any class of offered certificates unless you understand and are able to bear the risk that the yield to maturity and the aggregate amount and timing of distributions on the offered certificates are subject to material variability from period to period and give rise to the potential for significant loss over the life of the offered certificates. The interaction of the foregoing factors and their effects are impossible to predict and are likely to change from time to time. As a result, an investment in the offered certificates involves substantial risks and uncertainties and should be considered only by sophisticated institutional investors with substantial investment experience with similar types of securities and who have conducted appropriate due diligence on the mortgage loans and the offered certificates.
The Offered Certificates Are Limited Obligations
The offered certificates, when issued, will represent beneficial interests in the issuing entity. The offered certificates will not represent an interest in, or obligation of, the sponsors, the depositor, the master servicer, the special servicer, the operating advisor, the certificate administrator, the trustee, the underwriters, or any of their respective affiliates, or any other person. The primary assets of the issuing entity will be the notes evidencing the mortgage loans, and the primary security and source of payment for the mortgage loans will be the mortgaged properties and the other collateral described in this prospectus supplement. Payments on the offered certificates are expected to be derived from payments made by the borrowers on the mortgage loans. We cannot assure you that the cash flow from the mortgaged properties and the proceeds of any sale or refinancing of the mortgaged properties will be sufficient to pay the principal of, and interest on, the mortgage loans or to distribute in full the amounts of interest and principal to which the holders of the offered certificates are entitled. See “Description of the Certificates—General” in the prospectus.
The Volatile Economy, Credit Crisis and Downturn in the Real Estate Market Have Adversely Affected and May Continue to Adversely Affect the Value of CMBS
In recent years, the real estate and securitization markets, including the market for commercial mortgage-backed securities (“CMBS”), as well as global financial markets and the economy generally, have experienced significant dislocations, illiquidity and volatility. The United States economic recovery has been weak and may not be sustainable for any specific period of time, and the global or United States economy could slip into an even more significant recession. Declining real estate values, coupled with diminished availability of leverage and/or refinancings for commercial and multifamily real estate have resulted in increased delinquencies and defaults on commercial and multifamily mortgage loans. In addition, the downturn in the general economy has affected the financial strength of many commercial and multifamily real estate tenants and has resulted in increased vacancies, decreased rents and/or other declines in income from, or the value of, commercial and multifamily real estate. Any continued downturn may lead to decreased occupancy, decreased rents or other declines in income from, or the value of, commercial and multifamily real estate, which would likely have an adverse effect on CMBS
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that are backed by loans secured by such commercial and multifamily real estate and thus affect the liquidity and/or values of such CMBS.
Additionally, decreases in the value of commercial properties and the tightening by commercial real estate lenders of underwriting standards have prevented many commercial mortgage borrowers from refinancing their mortgages. A very substantial amount of U.S. mortgage loans, with balloon payment obligations in excess of their respective current property values, are maturing over the coming three years. These circumstances have increased delinquency and default rates of securitized commercial mortgage loans, and may lead to widespread commercial mortgage defaults. In addition, the declines in commercial real estate values have resulted in reduced borrower equity, hindering a borrower’s ability to refinance in an environment of increasingly restrictive lending standards and giving them less incentive to cure delinquencies and avoid foreclosure. Higher loan-to-value ratios are likely to result in lower recoveries on foreclosure, and an increase in loss severities above those that would have been realized had commercial property values remained the same or continued to increase. Defaults, delinquencies and losses have further decreased property values, thereby resulting in additional defaults by commercial mortgage borrowers, further credit constraints, further declines in property values and further adverse effects on the perception of the value of CMBS. Even if the real estate market does recover, the mortgaged properties and therefore, the certificates, may decline in value. Any further economic downturn may adversely affect the financial resources of the borrowers under the mortgage loans and may result in the inability of the borrowers to make principal and interest payments on the mortgage loans. In the event of default by the borrower under a mortgage loan, the certificateholders would likely suffer a loss on their investment.
As a result of all of these factors, we cannot assure you that a dislocation in the CMBS market will not re-occur or become more severe.
External Factors May Adversely Affect the Value and Liquidity of Your Investment
Due to factors not directly relating to the offered certificates or the underlying mortgage loans, the market value of the offered certificates can decline even if the offered certificates, the mortgage loans or the mortgaged properties are performing at or above your expectations.
Global, National and Local Economic Factors
The global financial markets have recently experienced increased volatility due to uncertainty surrounding the level and sustainability of the sovereign debt of various countries. Much of this uncertainty has related to certain countries that participate in the European Monetary Union and whose sovereign debt is generally denominated in Euros, the common currency shared by members of that union. In addition, some economists, observers and market participants have expressed concerns regarding the sustainability of the monetary union and the common currency in their current form. Concerns regarding sovereign debt may spread to other countries at any time. Furthermore, many state and local governments in the United States are experiencing, and are expected to continue to experience, severe budgetary strain. One or more states could default on their debt, or one or more significant local governments could default on their debt or seek relief from their debt under Title 11 of the United States Code, as amended (the “Bankruptcy Code”) or by agreement with their creditors. Any or all of the circumstances described above may lead to further volatility in or disruption of the credit markets at any time.
Risks to the Financial Markets Relating to Terrorist Attacks
Future terrorist activities may occur in the United States or abroad. It is impossible to predict whether, or the extent to which, future terrorist activities may occur in the United States or abroad and/or any consequent actions on the part of the United States Government and others, including military action, could have on general economic conditions, real estate markets, particular business segments (including those that are important to the performance of commercial mortgage loans) and/or insurance costs and the availability of insurance coverage for terrorist acts. Among other things, reduced investor confidence could result in substantial volatility in securities markets and a decline in real estate-related investments. In addition, reduced consumer confidence, as well as a heightened concern for personal safety, could result in a material decline in personal spending and travel.
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Other Events May Affect Your Investment
Moreover, other types of events, domestic or international, may affect general economic conditions and financial markets:
· | Wars, revolts, insurrections, armed conflicts, energy supply or price disruptions, terrorism, political crises, natural disasters and man-made disasters may have an adverse effect on the mortgaged properties and/or your certificates; |
· | Trading activity associated with indices of CMBS may drive spreads on those indices wider than spreads on CMBS, thereby resulting in a decrease in value of such CMBS, including your certificates, and spreads on those indices may be affected by a variety of factors, and may or may not be affected for reasons involving the commercial and multifamily real estate markets and may be affected for reasons that are unknown and cannot be discerned; and |
· | The market value of your certificates also may be affected by many other factors, including the then-prevailing interest rates and market perceptions of risks associated with commercial mortgage lending. A change in the market value of the certificates may be disproportionately impacted by upward or downward movements in the current interest rates. |
Investors should consider that the foregoing factors may adversely affect the performance of the mortgage loans and accordingly the performance of the offered certificates.
The Certificates May Have Limited Liquidity and the Market Value of the Certificates May Decline
As described above under“—The Volatile Economy, Credit Crisis and Downturn in the Real Estate Market Have Adversely Affected and May Continue to Adversely Affect the Value of CMBS,” the secondary market for mortgage-backed securities recently experienced extremely limited liquidity. The adverse conditions described above as well as other adverse conditions could continue to severely limit the liquidity for mortgage-backed securities and cause disruptions and volatility in the market for CMBS.
Your certificates will not be listed on any national securities exchange or traded on any automated quotation systems of any registered securities association, and there is currently no secondary market for your certificates. While we have been advised by the underwriters that one or more of them, or one or more of their affiliates, currently intend to make a market in the certificates, none of the underwriters has any obligation to do so, any market-making may be discontinued at any time, and we cannot assure you that an active secondary market for the offered certificates will develop. Additionally, one or more purchasers may purchase substantial portions of one or more classes of offered certificates. Accordingly, you may not have an active or liquid secondary market for your certificates. Lack of liquidity could result in a substantial decrease in the market value of your certificates.
The market value of the offered certificates will also be influenced by the supply of and demand for CMBS generally. The supply of CMBS will depend on, among other things, the amount of commercial and multifamily mortgage loans, whether newly originated or held in portfolios, that are available for securitization. A number of factors will affect investors’ demand for CMBS, including:
· | the availability of alternative investments that offer higher yields or are perceived as being a better credit risk, having a less volatile market value or being more liquid; |
· | legal and other restrictions that prohibit a particular entity from investing in CMBS or limit the amount or types of CMBS that it may acquire or require it to maintain increased capital or reserves as a result of its investment in CMBS; |
· | accounting standards that may affect an investor’s characterization or treatment of an investment in CMBS for financial reporting purposes; |
· | increased regulatory compliance burdens imposed on CMBS or securitizations generally, or on classes of securitizers, that may make securitization a less attractive financing option for commercial mortgage loans; |
· | investors’ perceptions regarding the commercial and multifamily real estate markets, which may be adversely affected by, among other things, a decline in real estate values or an increase in defaults and foreclosures on commercial mortgage loans; |
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· | investors’ perceptions regarding the capital markets in general, which may be adversely affected by political, social and economic events completely unrelated to the commercial real estate markets; and |
· | the impact on demand generally for CMBS as a result of the existence or cancellation of government-sponsored economic programs. |
If you decide to sell any offered certificates, the ability to sell your offered certificates will depend on, among other things, whether and to what extent a secondary market then exists for these offered certificates, and you may have to sell at a discount from the price you paid for reasons unrelated to the performance of the offered certificates or the mortgage loans.
The Exchangeable Certificates Are Subject to Additional Risks
The characteristics of the Class PEZ certificates will reflect, in the aggregate, the characteristics of the Class A-S, Class B and Class C certificates. As a result, the Class PEZ certificates will be subject to the same risks as the Class A-S, Class B and Class C certificates described in this prospectus supplement. Investors are also encouraged to consider a number of factors that will limit a certificateholder’s ability to exchange exchangeable certificates:
· | At the time of a proposed exchange, a certificateholder must own exchangeable certificates in the requisite exchangeable proportion to make the desired exchange, as described under “Description of the Offered Certificates—Exchangeable Certificates—Exchanges” in this prospectus supplement. |
· | A certificateholder that does not own exchangeable certificates in such requisite exchangeable proportion may be unable to obtain the necessary exchangeable certificates or may be able only to exchange the portion (if any) of its exchangeable certificates that represents such requisite exchangeable proportion. Another certificateholder may refuse to sell its certificates at a reasonable (or any) price or may be unable to sell them, or certificates may have been purchased or placed into other financial structures and thus may be unavailable. Such circumstances may prevent you from obtaining exchangeable certificates in the proportions necessary to effect an exchange. |
· | Exchanges will no longer be permitted following the date when the then-current principal balance of the Class A-S trust component (and, correspondingly, to the extent evidencing an interest in the Class A-S trust component, the Class A-S certificates and the applicable component of the Class PEZ certificates) is reduced to zero as a result of the payment in full of all interest and principal on that trust component. |
· | Certificates may only be held in authorized denominations. |
· | An exchange fee of $5,000 must be paid by the exchanging certificateholder to the certificate administrator in connection with each exchange of exchangeable certificates. |
Subordination of Exchangeable Certificates
As described in this prospectus supplement, if you acquire any exchangeable certificates, then your rights to receive distributions of amounts collected or advanced on or in respect of the mortgage loans will be subordinated to those of the holders of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class X-A certificates. If you acquire Class B certificates, then your rights to receive distributions of amounts collected or advanced on or in respect of the mortgage loans will also be subordinated to those of the holders of the Class A-S certificates and (insofar as the Class PEZ certificates represent an interest in the Class A-S trust component) the holders of the Class PEZ certificates. If you acquire Class C certificates, then your rights to receive distributions of amounts collected or advanced on or in respect of the mortgage loans will also be subordinated to those of the holders of the Class B certificates and (insofar as the Class PEZ certificates represent an interest in the Class A-S and Class B trust components) the holders of the Class PEZ certificates. If you acquire Class PEZ certificates, then
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your rights to receive distributions of amounts collected or advanced on or in respect of the mortgage loans will also be subordinated to: (a) insofar as the Class PEZ certificates represent an interest in the Class B and Class C trust components, those of the holders of the Class A-S certificates; and (b) insofar as the Class PEZ certificates represent an interest in the Class C trust component, those of the holders of the Class B certificates. See “Description of the Offered Certificates—Subordination” in this prospectus supplement.
Limited Information Causes Uncertainty
Historical Information
Some of the mortgage loans that we intend to include in the issuing entity were made to enable the related borrower to acquire the related mortgaged property, and in certain cases, the mortgaged properties were recently constructed. The underwritten net cash flows and underwritten net operating incomes for such mortgaged properties are derived principally from current rent rolls or tenant leases and the appraisers’ projected expense levels. However, we cannot assure you that actual cash flows from such mortgaged properties will meet such projected cash flows, income and expense levels or that those funds will be sufficient to meet the payment obligations of the related mortgage loans.
Accordingly, for certain of these mortgage loans, limited or no historical operating information is available with respect to the related mortgaged properties. As a result, you may find it difficult to analyze the historical performance of those mortgaged properties.
Ongoing Information
The primary source of ongoing information regarding the offered certificates, including information regarding the status of the related mortgage loans and any credit support for the offered certificates, will be the periodic reports delivered to you and the information we file with the Securities and Exchange Commission. See “The Pooling and Servicing Agreement—Reports to Certificateholders; Available Information” in this prospectus supplement. We cannot assure you that any additional ongoing information regarding the offered certificates will be available through any other source. The limited nature of the available information in respect of the offered certificates may adversely affect their liquidity, even if a secondary market for the offered certificates does develop.
We are not aware of any source through which pricing information regarding the offered certificates will be generally available on an ongoing basis or on any particular date.
Legal and Regulatory Provisions Affecting Investors Could Adversely Affect the Liquidity of the Offered Certificates
We make no representations as to the proper characterization of the offered certificates for legal investment, financial institution regulatory, financial reporting or other purposes, as to the ability of particular investors to purchase the offered certificates under applicable legal investment or other restrictions or as to the consequences of an investment in the offered certificates for such purposes or under such restrictions. We note that regulatory or legislative provisions applicable to certain investors may have the effect of limiting or restricting their ability to hold or acquire CMBS, which in turn may adversely affect the ability of investors in the offered certificates who are not subject to those provisions to resell their certificates in the secondary market. For example:
· | Effective January 1, 2014, EU Regulation 575/2013 (the “CRR”) imposes on European Economic Area (“EEA”) credit institutions and investment firms investing in securitizations issued on or after January 1, 2011, or in securitizations issued prior to that date where new assets are added or substituted after December 31, 2014: (a) a requirement (the “Retention Requirement”) that the originator, sponsor or original lender of such securitization has explicitly disclosed that it will retain, on an ongoing basis, a material net economic interest which, in any event, shall not be less than 5%; and (b) a requirement (the “Due Diligence Requirement”) that the investing credit institution or investment firm has undertaken certain due diligence in respect of the securitization and the underlying exposures and has established procedures for monitoring them on an ongoing basis. National regulators in EEA member states are required to impose penal risk weights on securitization investments in respect of which the Retention Requirement or the Due Diligence Requirement has |
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not been satisfied in any material respect by reason of the negligence or omission of the investing credit institution or investment firm. If the Retention Requirement or the Due Diligence Requirement is not satisfied in respect of a securitization investment held by a non-EEA subsidiary of an EEA credit institution or investment firm then an additional risk weight may be applied to such securitization investment when taken into account on a consolidated basis at the level of the EEA credit institution or investment firm. Requirements similar to the Retention Requirement and the Due Diligence Requirement (the “Similar Requirements”): (i) apply to investments in securitizations by investment funds managed by EEA investment managers subject to EU Directive 2011/61/EU; and (ii) subject to the adoption of certain secondary legislation, will apply to investments in securitizations by EEA insurance and reinsurance undertakings and by EEA undertakings for collective investment in transferable securities. None of the originators, the sponsors, the depositor or the issuing entity intends to retain a material net economic interest in the securitization constituted by the issue of the certificates in accordance with Retention Requirement or to take any other action which may be required by EEA-regulated investors for the purposes of their compliance with Retention Requirement, the Due Diligence Requirement or Similar Requirements. Consequently, credit institutions, investment firms or the other types of EEA regulated investors mentioned above are unlikely to be able to hold the certificates. As a result, the price and liquidity of the certificates in the secondary market may be adversely affected. This could adversely affect your ability to transfer certificates or the price you may receive upon your sale of certificates. |
· | The Dodd Frank Wall Street Reform and Consumer Protection Act (the “Dodd Frank Act”) enacted in the United States requires that federal banking agencies amend their regulations to remove reference to or reliance on credit agency ratings, including, but not limited to, those found in the federal banking agencies’ risk-based capital regulations. New capital regulations, which were adopted by the banking regulators in July 2013 and began phasing in on January 1, 2014, implement the increased capital requirements established under the Basel Accord. These new capital regulations eliminate reliance on credit ratings and otherwise alter, and in most cases increase, the capital requirements imposed on depository institutions and their holding companies, including with respect to ownership of asset-backed securities such as CMBS. As a result of these regulations, investments in CMBS like the certificates by institutions subject to the risk based capital regulations may result in greater capital charges to these financial institutions, and the treatment of CMBS for their regulatory capital purposes may otherwise be adversely affected. Such developments could reduce the attractiveness of investments in CMBS for such entities. |
· | The issuing entity will be relying on an exclusion or exemption from the definition of “investment company” under the Investment Company Act contained in Section 3(c)(5) of the Investment Company Act or Rule 3a-7 under the Investment Company Act, although there may be additional exclusions or exemptions available to the issuing entity. The issuing entity is being structured so as not to constitute a “covered fund” for purposes of the regulations adopted to implement Section 619 of the Dodd-Frank Act (such statutory provision, together with such implementing regulations, the “Volcker Rule”). The Volcker Rule generally prohibits “banking entities” (which is broadly defined to include U.S. banks and bank holding companies and many non-U.S. banking entities, together with their respective subsidiaries and other affiliates) from (i) engaging in proprietary trading, (ii) acquiring or retaining an ownership interest in or sponsoring a “covered fund” and (iii) entering into certain relationships with such funds. The Volcker Rule became effective on July 21, 2012, and final regulations implementing the Volcker Rule were adopted on December 10, 2013 and became effective on April 1, 2014. Conformance with the Volcker Rule and its implementing regulations is required by July 21, 2015 (or by July 21, 2016 in respect of investments in and relationships with covered funds that were in place prior to December 31, 2013, with the possibility of a further one-year extension). In the interim, banking entities must make good-faith efforts to conform their activities and investments to the Volcker Rule. Under the Volcker Rule, unless otherwise jointly determined by specified federal regulators, a “covered fund” does not include an issuer that may rely on an exclusion or exemption from the definition of “investment company” under the Investment Company Act other than the exclusions contained in Section 3(c)(1) and Section 3(c)(7) of the Investment Company Act. The general effects of the Volcker Rule remain uncertain. Any prospective investor in the certificates, including a U.S. or foreign bank or a subsidiary or other affiliate thereof, should consult its own legal advisors regarding such matters and other effects of the Volcker Rule. |
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· | The Financial Accounting Standards Board has adopted changes to the accounting standards for structured products. These changes, or any future changes, may affect the accounting for entities such as the issuing entity, could under certain circumstances require an investor or its owner generally to consolidate the assets of the issuing entity in its financial statements and record third parties’ investments in the issuing entity as liabilities of that investor or owner or could otherwise adversely affect the manner in which the investor or its owner must report an investment in commercial mortgage-backed securities for financial reporting purposes. |
· | For purposes of the Secondary Mortgage Market Enhancement Act of 1984, as amended, no class of offered certificates will constitute “mortgage related securities”. |
Accordingly, all investors whose investment activities are subject to legal investment laws and regulations, regulatory capital requirements, or review by regulatory authorities should consult with their own legal, accounting and other advisors in determining whether, and to what extent, the offered certificates will constitute legal investments for them or are subject to investment or other restrictions, unfavorable accounting treatment, capital charges or reserve requirements. See“Legal Investment” in this prospectus supplement and in the prospectus.
None of the issuing entity, the depositor, the underwriters, the mortgage loan sellers or any other party to the transaction makes any representation to any prospective investor or purchaser of the offered certificates regarding the regulatory capital treatment of their investment in the offered certificates on the closing date or at any time in the future.
Your Yield May Be Affected by Defaults, Prepayments and Other Factors
General
The yield to maturity on each class of the offered certificates will depend in part on the following:
· | the purchase price for the certificates; |
· | the rate and timing of principal payments on the mortgage loans (both voluntary and involuntary), and the allocation of principal prepayments to the respective classes of offered certificates with principal balances; and |
· | the allocation of shortfalls and losses on the mortgage loans to the respective classes of offered certificates. |
Any changes in the weighted average lives of your certificates may adversely affect your yield. In general, if you buy a certificate at a premium, and principal distributions occur faster than expected, your actual yield to maturity will be lower than expected. If principal distributions are very high, holders of certificates purchased at a premium might not fully recover their initial investment. Conversely, if you buy a certificate at a discount and principal distributions occur more slowly than expected, your actual yield to maturity will be lower than expected.
Prepayments resulting in a shortening of weighted average lives of your certificates may be made at a time of low interest rates when you may be unable to reinvest the resulting payment of principal on your certificates at a rate comparable to the effective yield anticipated by you in making your investment in the certificates, while delays and extensions resulting in a lengthening of those weighted average lives may occur at a time of high interest rates when you may have been able to reinvest principal payments that would otherwise have been received by you at higher rates.
In addition, the extent to which prepayments on the mortgage loans in the issuing entity ultimately affect the weighted average life of the certificates will depend on the terms of the certificates, more particularly:
· | a class of certificates that entitles the holders of those certificates to a disproportionately larger share of the prepayments on the mortgage loans increases the “call risk” or the likelihood of early retirement of that class if the rate of prepayment is relatively fast; and |
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· | a class of certificates that entitles the holders of the certificates to a disproportionately smaller share of the prepayments on the mortgage loans increases the likelihood of “extension risk” or an extended average life of that class if the rate of prepayment is relatively slow. |
The Timing of Prepayments and Repurchases May Change Your Anticipated Yield
We are not aware of any relevant publicly available or authoritative statistics with respect to the historical prepayment experiences of commercial mortgage loans. For this purpose, principal payments include both voluntary prepayments, if permitted, and involuntary prepayments, such as prepayments resulting from the application of loan reserves, property releases, casualty or condemnation, defaults and liquidations or repurchases upon breaches of representations and warranties or material document defects or purchases by the holder of a subordinate companion loan or a mezzanine lender (if any) pursuant to a purchase option or sales of defaulted mortgage loans. The rate at which voluntary prepayments occur on the mortgage loans will be affected by a variety of factors, including:
· | the terms of the mortgage loans, including, the length of any prepayment lockout period and the applicable yield maintenance charges and prepayment premiums and the extent to which the related mortgage loan terms may be practically enforced; |
· | the level of prevailing interest rates; |
· | the availability of mortgage credit; |
· | the master servicer’s or special servicer’s ability to enforce yield maintenance charges and prepayment premiums; |
· | the failure to meet certain requirements for the release of escrows; |
· | the occurrence of casualties or natural disasters; and |
· | economic, demographic, tax, legal or other factors. |
See“Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—Prepayment Protections and Certain Involuntary Prepayments” in this prospectus supplement for a description of certain prepayment protections and other factors that may influence the rate of prepayment of the mortgage loans. See “Risk Factors—Some Provisions in the Mortgage Loans Underlying Your Offered Certificates May Be Challenged as Being Unenforceable” in the prospectus.
In addition, if a sponsor (or, in the case of RAIT Funding, LLC, RAIT Financial Trust, as guarantor of the repurchase and substitution obligations of RAIT Funding, LLC, or in the case of KGS-Alpha Real Estate Capital Markets, LLC, KGS Holdings, L.P., as guarantor of the repurchase and substitution obligations of KGS-Alpha Real Estate Capital Markets, LLC) repurchases any mortgage loan from the issuing entity due to breaches of representations or warranties or document defects, the repurchase price paid will be passed through to the holders of the certificates with the same effect as if the mortgage loan had been prepaid in part or in full, and no yield maintenance charge or other prepayment charge would be payable. Additionally, the holder of any subordinate companion loan (if any) or any mezzanine lender (if any) may have the option to purchase the related mortgage loan after certain defaults, and the purchase price may not include any yield maintenance payments or prepayment charges. As a result of such a repurchase or purchase, investors in the Class X-A certificates and any other certificates purchased at a premium might not fully recoup their initial investment. A repurchase, a prepayment or the exercise of a purchase option may adversely affect the yield to maturity on your certificates. In this respect, see “Description of the Mortgage Pool—Representations and Warranties” and “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans” in this prospectus supplement.
The Class X-A certificates will not be entitled to distributions of principal but instead will accrue interest on their notional amount. Because the notional amount of the Class X-A certificates is based upon the outstanding certificate principal amounts of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S trust component, the yield to maturity on the Class X-A certificates will be extremely sensitive to the rate and timing of prepayments of principal, liquidations and principal losses on the mortgage loans to the extent
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allocated to theClass A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S trust component.
A rapid rate of principal prepayments, liquidations and/or principal losses on the mortgage loans could result in the failure to recoup the initial investment in the Class X-A certificates. Investors in the Class X-A certificates should fully consider the associated risks, including the risk that an extremely rapid rate of amortization, prepayment or other liquidation of the mortgage loans could result in the failure of such investors to recoup fully their initial investments. The yield to maturity of the Class X-A certificates may be adversely affected by the prepayment of mortgage loans with higher net mortgage loan rates. See “Yield, Prepayment and Maturity Considerations—Yield on the Class X-A Certificates” in this prospectus supplement.
Losses and Shortfalls May Change Your Anticipated Yield
If losses on the mortgage loans exceed the aggregate certificate principal amount of the classes of certificates subordinated to a particular class, that class will suffer a loss equal to the full amount of the excess (up to the outstanding certificate principal amount of that class). Even if losses on the mortgage loans are not borne by your certificates, those losses may affect the weighted average life and yield to maturity of your certificates.
For example, certain shortfalls in interest as a result of involuntary prepayments may reduce the funds available to make payments on your certificates. In addition, if the master servicer or the trustee is reimbursed out of general collections on the mortgage loans included in the issuing entity for any advance that it has determined is not recoverable out of collections on the related mortgage loan, then to the extent that this reimbursement is made from collections of principal on the mortgage loans in the issuing entity, that reimbursement will reduce the amount of principal available to be distributed on the certificates and will result in a reduction of the certificate principal amount (or notional amount) of a class of certificates. See “Description of the Offered Certificates—Distributions” in this prospectus supplement. Likewise, if the master servicer or the trustee is reimbursed out of principal collections on the mortgage loans for any workout delayed reimbursement amounts, that reimbursement will reduce the amount of principal available to be distributed on the certificates on that distribution date. This reimbursement would have the effect of reducing current payments of principal on the offered certificates with principal balances and extending the weighted average lives of those certificates. See “Description of the Offered Certificates—Distributions” in this prospectus supplement.
In addition, to the extent losses are realized on the mortgage loans, first the Class H certificates, then the Class G certificates, then the Class F certificates, then the Class E certificates, then the Class D certificates, then the Class C trust component (and correspondingly, the Class C certificates and the Class PEZ certificates, pro rata based on their respective percentage interests in the Class C trust component), then the Class B trust component (and correspondingly, the Class B certificates and the Class PEZ certificates, pro rata based on their respective percentage interests in the Class B trust component), then the Class A-S trust component (and correspondingly, the Class A-S certificates and the Class PEZ certificates, pro rata based on their respective percentage interests in the Class A-S trust component) and, then, pro rata, the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates, based on their respective certificate principal amounts, will bear such losses up to an amount equal to the respective outstanding certificate principal amount thereof. A reduction in the certificate principal amount of the Class A-1, Class A-2, Class A-3, Class A-4 or Class A-AB certificates or the Class A-S trust component will result in a corresponding reduction in the notional amount of the Class X-A certificates. No representation is made as to the anticipated rate or timing of prepayments (voluntary or involuntary) or rate, timing or amount of liquidations or losses on the mortgage loans or as to the anticipated yield to maturity of any such offered certificate. See “Yield, Prepayment and Maturity Considerations” in this prospectus supplement.
The exchangeable certificates will be subject to a realized loss or shortfall on the Class A-S, Class B or Class C trust component to the extent of their percentage interest in such trust component. See “Description of the Offered Certificates—Distributions” in this prospectus supplement.
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Nationally Recognized Statistical Rating Organizations May Assign Different Ratings to the Certificates; Ratings of the Certificates Reflect Only the Views of the Applicable Rating Agencies as of the Dates Such Ratings Were Issued; Ratings May Affect ERISA Eligibility; Ratings May Be Downgraded
Ratings assigned to the offered certificates by the nationally recognized statistical rating organizations engaged by the depositor:
· | are based on, among other things, the economic characteristics of the mortgaged properties and other relevant structural features of the transaction; |
· | do not represent any assessment of the yield to maturity that a certificateholder may experience; |
· | reflect only the views of the respective rating agencies as of the date such ratings were issued; |
· | may be reviewed, revised, suspended, downgraded, qualified or withdrawn entirely by the applicable rating agency as a result of changes in or unavailability of information; |
· | may have been determined based on criteria that included an analysis of historical mortgage loan data that may not reflect future experience; |
· | may reflect assumptions by such rating agencies regarding performance of the mortgage loans that are not accurate, as evidenced by the significant amount of downgrades, qualifications and withdrawals of ratings assigned to previously issued CMBS by the hired rating agencies and other nationally recognized statistical rating organizations during the recent credit crisis; and |
· | do not consider to what extent the offered certificates will be subject to prepayment or that the outstanding principal amount of any class of offered certificates will be prepaid. |
In addition, the rating of any class of offered certificates below an investment grade rating by any nationally recognized statistical rating organization, whether upon initial issuance of such class of certificates or as a result of a ratings downgrade, could adversely affect the ability of an employee benefit plan or other investor to purchase or retain those offered certificates. See “ERISA Considerations” and“Legal Investment”in this prospectus supplement.
Nationally recognized statistical rating organizations that were not engaged by the depositor to rate the offered certificates may nevertheless issue unsolicited credit ratings on one or more classes of offered certificates, relying on information they receive pursuant to Rule 17g-5 under the Securities Exchange Act of 1934, as amended, or otherwise. If any such unsolicited ratings are issued, we cannot assure you that they will not be different from any ratings assigned by a rating agency engaged by the depositor. The issuance of unsolicited ratings by any nationally recognized statistical rating organization on a class of the offered certificates that are lower than ratings assigned by a rating agency engaged by the depositor may adversely impact the liquidity, market value and regulatory characteristics of that class.
As part of the process of obtaining ratings for the offered certificates, the depositor had initial discussions with and submitted certain materials to five nationally recognized statistical rating organizations. Based on preliminary feedback from those nationally recognized statistical rating organizations at that time, the depositor selected three of those nationally recognized statistical rating organizations to rate the offered certificates (or, in the case of any particular nationally recognized statistical rating organization so selected, certain classes of the offered certificates) but not the others, due in part to their initial subordination levels for the various classes of the offered and non-offered certificates. Had the depositor selected alternative nationally recognized statistical rating organizations to rate the offered certificates, we cannot assure you as to the ratings that such other nationally recognized statistical rating organizations would have ultimately assigned to the offered certificates. In the case of one of the three nationally recognized statistical rating organizations selected by the depositor, the depositor has requested ratings for only certain classes of the offered certificates, due in part to the initial subordination levels provided by such nationally recognized statistical rating organization for the various classes of the offered certificates. If the depositor had selected such nationally recognized statistical rating organization to rate the remaining classes of offered certificates not rated by it, its ratings of such certificates may have been different, and potentially lower, than those ratings ultimately assigned to such certificates by the other nationally recognized
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statistical rating organizations engaged to rate such certificates. Although unsolicited ratings may be issued by any nationally recognized statistical rating organization, a nationally recognized statistical rating organization might be more likely to issue an unsolicited rating if it was not selected after having provided preliminary feedback to the depositor.
Furthermore, the Securities and Exchange Commission may determine that any or all of the rating agencies engaged by the depositor to rate the offered certificates no longer qualify as a nationally recognized statistical rating organization, or are no longer qualified to rate the offered certificates, and that determination may also have an adverse effect on the liquidity, market value and regulatory characteristics of the offered certificates.
We are not obligated to maintain any particular rating with respect to the offered certificates, and the ratings initially assigned to the offered certificates by any or all of the rating agencies engaged by the depositor to rate the offered certificates could change adversely as a result of changes affecting, among other things, the underlying mortgage loans, the mortgaged properties, the sponsors, the certificate administrator, the trustee, the operating advisor, the master servicer or the special servicer, or as a result of changes to ratings criteria employed by any or all of the rating agencies engaged by the depositor to rate the offered certificates. Although these changes would not necessarily be or result from an event of default on any underlying mortgage loan, any adverse change to the ratings of the offered certificates would likely have an adverse effect on the market value, liquidity and/or regulatory characteristics of those certificates.
To the extent that the provisions of the pooling and servicing agreement or any mortgage loan serviced thereunder condition any action, event or circumstance on the delivery of a rating agency confirmation, the pooling and servicing agreement will require delivery or deemed delivery of a rating agency confirmation only from the rating agencies engaged by the depositor to rate the offered certificates (and, in the case of certain actions, events or consequences related to any serviced pari passu companion loan that is included in a securitization transaction, the related companion loan rating agencies).
Further, certain actions provided for in loan agreements may require a rating agency confirmation be obtained from the rating agencies engaged by the depositor to rate the offered certificates as a precondition to taking such action. In certain circumstances, this condition may be deemed to have been met or waived without such a rating agency confirmation being obtained. In the event such an action is taken without a rating agency confirmation being obtained, we cannot assure you that the applicable rating agency will not downgrade, qualify or withdraw its ratings as a result of the taking of such action. Rating agency confirmations with respect to any outside serviced mortgage loan will also be subject to the terms and provisions of the related outside servicing agreement. See “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—’Due-On-Sale’ and ‘Due-On-Encumbrance’ Provisions,” “The Pooling and Servicing Agreement—Rating Agency Confirmations” and “Ratings” in this prospectus supplement for additional considerations regarding the ratings, including a description of the process of obtaining confirmations of ratings for the offered certificates.
Commercial and Multifamily Lending Is Dependent on Net Operating Income
The mortgage loans are secured by various income-producing commercial and multifamily properties. The repayment of a commercial or multifamily mortgage loan is typically dependent upon the ability of the related mortgaged property to produce cash flow through the collection of rents. Even the liquidation value of a commercial or multifamily property is determined, in substantial part, by the capitalization of the property’s ability to produce cash flow. However, net operating income can be volatile and may be insufficient to cover debt service on the commercial or multifamily mortgage loan at any given time.
For certain historical financial information relating to the mortgaged properties, including net operating income for the most recent reporting period and prior three calendar years, to the extent available, prospective investors should review Annex A to this prospectus supplement. Certain mortgage loans are secured in whole or in part by mortgaged properties that have no prior operating history available or otherwise lack historical financial figures and information. A mortgaged property may lack prior operating history or historical financial information for various reasons including because it is newly constructed or renovated, it is a recent acquisition by the related borrower or it is a single-tenant property that is subject to a triple net lease. In addition, a tenant’s lease may contain confidentiality provisions that restrict the sponsors’ access to or disclosure of such tenant’s financial information. Although the underwritten net cash flows and underwritten net operating income for mortgaged properties are derived principally from current rent rolls or tenant leases, underwritten net cash flows may also, in some cases, be based on (i) leases (or letters of intent) that are not yet in place (and may still be under
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negotiation), (ii) tenants that may have signed a lease (or letter of intent) or a lease amendment expanding the leased space, but are not yet in occupancy and/or are not yet paying rent, (iii) tenants that are leasing on a month-to-month basis and have the right to terminate their leases on a monthly basis, and/or (iv) historical expenses, adjusted to account for inflation, significant occupancy increases and a market rate management fee. However, we cannot assure you that such tenants will execute leases (or letters of intent) or expand their space or, in any event, that actual cash flows from such mortgaged properties will meet such projected cash flows, income and expense levels or that those funds will be sufficient to meet the payment obligations of the related mortgage loans.
See “—Underwritten Net Cash Flow Could Be Based on Incorrect or Failed Assumptions” below and “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—Additional Mortgage Loan Information” in this prospectus supplement. See “Risk Factors—Repayment of a Commercial or Multifamily Mortgage Loan Depends Upon the Performance and Value of the Underlying Real Property, Which May Decline Over Time, and the Related Borrower’s Ability to Refinance the Property, of Which There Is No Assurance” in the prospectus for a discussion of factors that could adversely affect the net operating income and property value of commercial properties.
Underwritten Net Cash Flow Could Be Based on Incorrect or Failed Assumptions
As described in “Description of the Mortgage Pool—Certain Calculations and Definitions” in this prospectus supplement and Annex A to this prospectus supplement, underwritten net cash flow means cash flow (including any cash flow from master leases) as adjusted based on a number of assumptions used by the related sponsor. No representation is made that the underwritten net cash flow set forth in this prospectus supplement as of the cut-off date or any other date represents actual future net cash flows. For example, with respect to certain mortgage loans included in the issuing entity, the occupancy of the related mortgaged property reflects tenants that may not have yet actually executed leases (or letters of intent) or that have signed leases but have not yet taken occupancy and/or are not paying full contractual rent or tenants that are seeking or may in the future seek to sublet all or a portion of their respective spaces, or tenants that are “dark” tenants but paying rent, or space that has been master leased to an affiliate of a borrower. You should review these assumptions and make your own determination of the appropriate assumptions to be used in determining underwritten net cash flow. In many cases, co-tenancy provisions were assumed to be satisfied and vacant space was assumed to be occupied and space that was due to expire was assumed to have been re-let, in each case at market rates that may have exceeded current rent.
In the event of the inaccuracy of any assumptions or projections used in connection with the calculation of underwritten net cash flow, the actual net cash flow could be significantly different (and, in some cases, may be materially less) than the underwritten net cash flow presented in this prospectus supplement, and this would change other numerical information presented in this prospectus supplement based on or derived from the underwritten net cash flow, such as the debt service coverage ratios presented in this prospectus supplement.
In addition, the debt service coverage ratios set forth in this prospectus supplement for the mortgage loans and the mortgaged properties vary, and may vary substantially, from the debt service coverage ratios for the mortgage loans and the mortgaged properties as calculated pursuant to the definition of such ratios as set forth in the related mortgage loan documents. See “Description of the Mortgage Pool—Certain Calculations and Definitions” in this prospectus supplement for additional information on certain of the mortgage loans in the issuing entity.
The Mortgage Loans Have Not Been Reunderwritten by Us; Some Mortgage Loans May Not Have Complied with Another Originator’s Underwriting Criteria
We have not reunderwritten the mortgage loans or the related loan combinations. Instead, we have relied on the representations and warranties made by the related sponsor, and the remedies for breach of a representation and warranty as described under “Description of the Mortgage Pool—Representations and Warranties” and “—Cures, Repurchases and Substitutions” in this prospectus supplement.
If we had reunderwritten the mortgage loans or the related loan combinations, it is possible that the reunderwriting process may have revealed problems with a mortgage loan not covered by a representation or warranty or may have revealed inaccuracies in the representations and warranties. See “—Sponsors May Not Be Able to Make Required Repurchases or Substitutions of Defective Mortgage Loans” below, “Description of the
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Mortgage Pool—Representations and Warranties” and “—Cures, Repurchases and Substitutions” in this prospectus supplement.
In addition, we cannot assure you that all of the mortgage loans would have complied with the underwriting criteria of the other originators or, accordingly, that each originator would have made the same decision to originate every mortgage loan included in the issuing entity or, if they did decide to originate an unrelated mortgage loan, that they would have been underwritten on the same terms and conditions.
As a result of the foregoing, you are advised and encouraged to make your own investment decision based on a careful review of the information set forth in this prospectus supplement and your own view of the mortgage pool.
Static Pool Data Would Not Be Indicative of the Performance of This Pool
As a result of the distinct nature of each pool of commercial mortgage loans, and the separate mortgage loans within the pool, this prospectus supplement does not include disclosure concerning the delinquency and loss experience of static pools of periodic originations by any sponsor of assets of the type to be securitized (known as “static pool data”). In particular, static pool data showing a low level of delinquencies and defaults would not be indicative of the performance of this pool or any other pools of mortgage loans originated by the same sponsor or sponsors. While there may be certain common factors affecting the performance and value of income-producing real properties in general, those factors do not apply equally to all income-producing real properties and, in many cases, there are unique factors that will affect the performance and/or value of a particular income-producing real property. Therefore, you should evaluate this offering on the basis of the information set forth in this prospectus supplement with respect to the mortgage loans, and not on the basis of any successful performance of other pools of securitized commercial mortgage loans.
Appraisals May Not Reflect Current or Future Market Value of Each Property
Appraisals were obtained with respect to each of the mortgaged properties at or about the time of origination of the applicable mortgage loan (or loan combination, if applicable) or at or around the time of the acquisition of the mortgage loan (or loan combination, if applicable) by the related sponsor. See Annex A to this prospectus supplement for dates of the latest appraisals for the mortgaged properties.
In general, appraisals represent the analysis and opinion of qualified appraisers and are not guarantees of present or future value. One appraiser may reach a different conclusion than that of a different appraiser with respect to the same property. The appraisals seek to establish the amount a typically motivated buyer would pay a typically motivated seller and, in certain cases, may have taken into consideration the purchase price paid by the borrower. The amount could be significantly higher than the amount obtained from the sale of a mortgaged property in a distress or liquidation sale. Information regarding the appraised values of the mortgaged properties (including loan-to-value ratios) presented in this prospectus supplement is not intended to be a representation as to the past, present or future market values of the mortgaged properties. For example, in some cases, a borrower or its affiliate may have acquired the related mortgaged property for a price or otherwise for consideration in an amount that is less than the related appraised value specified on Annex A to this prospectus supplement, including at a foreclosure sale or through acceptance of a deed-in-lieu of foreclosure. Historical operating results of the mortgaged properties used in these appraisals, as adjusted by various assumptions, estimates and subjective judgments on the part of the appraiser, may not be comparable to future operating results. In addition, other factors may impair the mortgaged properties’ value without affecting their current net operating income, including:
· | changes in governmental regulations, zoning or tax laws; |
· | potential environmental or other legal liabilities; |
· | the availability of refinancing; and |
· | changes in interest rate levels. |
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In certain cases, appraisals may reflect “as-is”, “as stabilized” or other values. However, the appraised value reflected in this prospectus supplement with respect to each mortgaged property, except as described under “Description of the Mortgage Pool—Certain Calculations and Definitions”, reflects only the “as-is” value (or, in certain cases, may reflect the “as stabilized” or other value as a result of the satisfaction of the related conditions or assumptions unless otherwise specified), which may contain certain assumptions, such as future construction completion, projected re-tenanting or increased tenant occupancies. See “Description of the Mortgage Pool—Appraised Value” in this prospectus supplement.
We cannot assure you that the information set forth in this prospectus supplement regarding appraised values or loan-to-value ratios accurately reflects past, present or future market values of the mortgaged properties. Additionally, with respect to the appraisals setting forth assumptions, particularly those setting forth extraordinary assumptions, as to the “as-is”, “as stabilized” or other values, we cannot assure you that those assumptions are or will be accurate or that the “as-is”, “as stabilized” or other values will be the value of the related mortgaged property at the indicated stabilization date or at maturity. Any engineering report, site inspection or appraisal represents only the analysis of the individual consultant, engineer or inspector preparing such report at the time of such report, and may not reveal all necessary or desirable repairs, maintenance and capital improvement items. See “Transaction Parties—The Originators—Citigroup Global Markets Realty Corp.—Third Party Reports”, “—The Originators—The Goldman Originators—Origination and Underwriting Process”, “—The Originators—Rialto Mortgage Finance, LLC—Assessments of Property Condition”, “—The Originators—RAIT Funding, LLC—Loan Analysis” and “—The Originators—KGS-Alpha Real Estate Capital Markets, LLC—Assessments of Property Condition” in this prospectus supplement for additional information regarding the appraisals.
Performance of the Certificates Will Be Highly Dependent on the Performance of Tenants and Tenant Leases
General
Any tenant may, from time to time, experience a downturn in its business, which may weaken its financial condition and result in a reduction or failure to make rental payments when due. If tenants’ sales were to decline, percentage rents may decline and, further, tenants may be unable to pay their base rent or other occupancy costs. If a tenant defaults in its obligations to a property owner, that property owner may experience delays in enforcing its rights as lessor and may incur substantial costs and experience significant delays associated with protecting its investment, including costs incurred in renovating and reletting the property.
Additionally, the income from, and market value of, the mortgaged properties leased to various tenants would be adversely affected if:
· | space in the mortgaged properties could not be leased or re-leased or substantial re-leasing costs were required and/or the cost of performing landlord obligations under existing leases materially increased; |
· | leasing or re-leasing is restricted by exclusive rights of tenants to lease the mortgaged properties or other covenants not to lease space for certain uses or activities, or covenants limiting the types of tenants to which space may be leased; |
· | a significant tenant were to become a debtor in a bankruptcy case; |
· | rental payments could not be collected for any other reason; or |
· | a borrower fails to perform its obligations under a lease resulting in the related tenant having a right to terminate such lease. |
In addition, certain of the mortgage loans may have tenants who are leasing their spaces on a month-to-month basis and have the right to terminate their leases on a monthly basis.
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A Tenant Concentration May Result in Increased Losses
A deterioration in the financial condition of a tenant, the failure of a tenant to renew its lease or the exercise by a tenant of an early termination right can be particularly significant if a mortgaged property is owner-occupied, leased to a single tenant, or if any tenant makes up a significant portion of the rental income at the mortgaged property.
Concentrations of particular tenants among the mortgaged properties or within a particular business or industry at one or multiple mortgaged properties increase the possibility that financial problems with such tenants or such business or industry sectors could affect the mortgage loans. In these cases, business issues for a particular tenant could have a disproportionately large impact on the pool of mortgage loans and adversely affect distributions to certificateholders. Similarly, an issue with respect to a particular industry could also have a disproportionately large impact on the pool of mortgage loans. In addition, the mortgage loans may be adversely affected if a tenant at the mortgaged property is highly specialized, or dependent on a single industry or only a few customers for its revenue. See “—Tenant Bankruptcy Could Result in a Rejection of the Related Lease” below, and “Description of the Mortgage Pool—Tenant Issues—Tenant Concentrations” in this prospectus supplement for information on tenant concentrations in the mortgage pool.
Mortgaged Properties Leased to Multiple Tenants Also Have Risks
If a mortgaged property has multiple tenants, re-leasing expenditures may be more frequent than in the case of mortgaged properties with fewer tenants, thereby reducing the cash flow available for payments on the related mortgage loan. Multi-tenant mortgaged properties also may experience higher continuing vacancy rates and greater volatility in rental income and expenses. See Annex A to this prospectus supplement for tenant lease expiration dates for the 5 largest tenants at each mortgaged property.
Mortgaged Properties Leased to Borrowers or Borrower Affiliated Entities Also Have Risks
If a mortgaged property is leased in whole or substantial part to the borrower under the mortgage loan or to an affiliate of the borrower, there may be conflicts. For instance, it is more likely a landlord will waive lease conditions for an affiliated tenant than it would for an unaffiliated tenant. We cannot assure you that the conflicts arising where a borrower is affiliated with a tenant at a mortgaged property will not adversely impact the value of the related mortgage loan. See “Description of the Mortgage Pool—Tenant Issues—Affiliated Leases” in this prospectus supplement for information on properties leased in whole or in part to borrowers and their affiliates.
Tenant Bankruptcy Could Result in a Rejection of the Related Lease
The bankruptcy or insolvency of a major tenant or a number of smaller tenants, such as in retail properties, may have an adverse impact on the mortgaged properties affected and the income produced by such mortgaged properties. Under the Bankruptcy Code, a tenant has the option of assuming or rejecting or, subject to certain conditions, assuming and assigning to a third party, any unexpired lease. If the tenant rejects the lease, the landlord’s claim for breach of the lease would (absent collateral securing the claim) be treated as a general unsecured claim against the tenant and a lessor’s damages for lease rejection are generally subject to certain limitations. We cannot assure you that tenants of the mortgaged properties will continue making payments under their leases or that tenants will not file for bankruptcy protection in the future or, if any tenants so file, that they will continue to make rental payments in a timely manner. See “Certain Legal Aspects of the Mortgage Loans—Bankruptcy Issues” in the prospectus. See “Description of the Mortgage Pool—Default History, Bankruptcy Issues and Other Proceedings” in this prospectus supplement for information regarding bankruptcy issues with respect to certain mortgage loans.
Leases That Are Not Subordinated to the Lien of the Mortgage or Do Not Contain Attornment Provisions May Have an Adverse Impact at Foreclosure
In certain jurisdictions, if tenant leases are subordinated to the liens created by the mortgage but do not contain attornment provisions that require the tenant to subordinate the lease if the mortgagee agrees to enter into a non-disturbance agreement, the tenants may terminate their leases upon the transfer of the property to a foreclosing lender or purchaser at foreclosure. Accordingly, if a mortgaged property is located in such a jurisdiction and is leased to one or more desirable tenants under leases that are subordinate to the mortgage and do not contain attornment provisions, such mortgaged property could experience a further decline in value if such
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tenants’ leases were terminated. This is particularly likely if such tenants were paying above-market rents or could not be replaced. If a lease is not subordinate to a mortgage, the issuing entity will not possess the right to dispossess the tenant upon foreclosure of the mortgaged property (unless otherwise agreed to with the tenant). Also, if the lease contains provisions inconsistent with the mortgage (e.g., provisions relating to application of insurance proceeds or condemnation awards) or which could affect the enforcement of the lender’s rights (e.g., a right of first refusal to purchase the property), the provisions of the lease will take precedence over the provisions of the mortgage. Not all leases were reviewed to ascertain the existence of attornment or subordination provisions.
With respect to certain of the mortgage loans, the related borrower has given to certain tenants or others an option to purchase, a right of first refusal and/or a right of first offer to purchase all or a portion of the mortgaged property in the event a sale is contemplated, and such right is not subordinate to the related mortgage. This may impede the mortgagee’s ability to sell the related mortgaged property at foreclosure, or, upon foreclosure, this may affect the value and/or marketability of the related mortgaged property. See “Description of the Mortgage Pool—Tenant Issues—Purchase Options, Rights of First Offer and Rights of First Refusal” in this prospectus supplement for information regarding material purchase options, rights of first offer and/or rights of first refusal, if any, with respect to mortgaged properties securing certain mortgage loans.
Early Lease Termination Options May Reduce Cash Flow
Any exercise of a termination right by a tenant at a mortgaged property could result in vacant space at the related mortgaged property, renegotiation of the lease with the related tenant or re-letting of the space on a date earlier than the lease expiration date shown on Annex A to this prospectus supplement or in rent rolls. Any such vacated space may not be re-let. Furthermore, similar termination and/or abatement rights may arise in the future or materially adversely affect the related borrower’s ability to meet its obligations under the related mortgage loan documents. See “Description of the Mortgage Pool—Tenant Issues—Lease Expirations and Terminations” in this prospectus supplement for information on material tenant lease expirations and early termination options.
Mortgaged Properties Leased to Not-for-Profit Tenants Also Have Risks
Certain mortgaged properties, which may include office, retail and multifamily properties, among others, may have tenants that are charitable institutions that generally rely on contributions from individuals and government grants or other subsidies to pay rent on such properties and other operating expenses. We cannot assure you that the rate, frequency and level of individual contributions or governmental grants and subsidies will continue with respect to any such institution. A reduction in contributions or grants may impact the ability of the related institution to pay rent, and there can be no assurance that the related borrower will be in a position to meet its obligations under the related mortgage loan documents if such tenant fails to pay its rent.
Concentrations Based on Property Type, Geography, Related Borrowers and Other Factors May Disproportionately Increase Losses
The effect of mortgage pool loan losses will be more severe if the losses relate to mortgage loans that account for a disproportionately large percentage of the pool’s aggregate principal balance. As mortgage loans pay down or properties are released, the remaining mortgage loans may face a higher risk with respect to the diversity of property types and property characteristics and with respect to the number of borrowers.
See the tables entitled “Distribution of Remaining Terms to Maturity”in Annex C to this prospectus supplement for a stratification of the remaining terms to maturity of the mortgage loans. Because principal on the offered certificates and the trust components is payable in sequential order of payment priority, and a class or trust component receives principal only after the preceding class(es) or trust component(s), as applicable, have been paid in full, classes or trust components that have a lower sequential priority are more likely to face these types of risk of concentration than classes or trust components with a higher sequential priority.
A concentration of mortgage loans secured by the same mortgaged property types can increase the risk that a decline in a particular industry or business would have a disproportionately large impact on the pool of mortgage loans. Mortgaged property types representing more than 5.0% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date (based on allocated loan amount) are office, mixed use, retail, multifamily and self storage. See“Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans—Property Types” in this prospectus supplement for information on the types of mortgaged properties securing the
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mortgage loans in the mortgage pool. For a description of the risks relating to the specific property types, see “Risk Factors—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks” in the prospectus.
Repayments by borrowers and the market value of the related mortgaged properties could be affected by economic conditions generally or specific to particular geographic areas or regions of the United States, and concentrations of mortgaged properties in particular geographic areas may increase the risk that conditions in the real estate market where the mortgaged property is located, or other adverse economic or other developments or natural disasters (e.g., earthquakes, floods, forest fires, tornadoes or hurricanes or changes in governmental rules or fiscal policies) affecting a particular region of the country, could increase the frequency and severity of losses on mortgage loans secured by those mortgaged properties. Mortgaged properties securing more than 5.0% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date (based on allocated loan amount) are located in Texas, California, Illinois, Washington, Oklahoma, Florida and Ohio. See “Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans—Geographic Concentrations” in this prospectus supplement.
Some of the mortgaged properties are located in areas that, based on low population density, poor economic demographics (such as higher than average unemployment rates, lower than average annual household income and/or overall loss of jobs) and/or negative trends in such regards, would be considered secondary or tertiary markets.
A concentration of mortgage loans with the same borrower or related borrowers also can pose increased risks:
· | if a borrower that owns or controls several mortgaged properties (whether or not all of them secure mortgage loans in the mortgage pool) experiences financial difficulty at 1 mortgaged property, it could defer maintenance at another mortgaged property in order to satisfy current expenses with respect to the first mortgaged property; |
· | a borrower could also attempt to avert foreclosure by filing a bankruptcy petition that might have the effect of interrupting debt service payments on the mortgage loans in the mortgage pool secured by that borrower’s mortgaged properties (subject to the master servicer’s and the trustee’s obligation to make advances for monthly payments) for an indefinite period; and |
· | mortgaged properties owned by the same borrower or related borrowers are likely to have common management, common general partners and/or common managing members increasing the risk that financial or other difficulties experienced by such related parties could have a greater impact on the pool of mortgage loans. See “—A Bankruptcy Proceeding May Result in Losses and Delays in Realizing on the Mortgage Loans” below. |
See “Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans” in this prospectus supplement for information on the composition of the mortgage pool by property type and geographic distribution and loan concentration.
Risks Relating to Enforceability of Cross-Collateralization
Cross-collateralization arrangements may be terminated in certain circumstances under the terms of the related mortgage loan documents. Cross-collateralization arrangements whereby multiple borrowers grant their respective mortgaged properties as security for one or more mortgage loans could be challenged as fraudulent conveyances by the creditors or the bankruptcy estate of any of the related borrowers.
Among other things, a legal challenge to the granting of the liens may focus on the benefits realized by that borrower from the respective mortgage loan proceeds, as well as the overall cross-collateralization. If a court were to conclude that the granting of the liens was an avoidable fraudulent conveyance, that court could subordinate all or part of the mortgage loan to other debt of that borrower, recover prior payments made on that mortgage loan, or take other actions such as invalidating the mortgage loan or the mortgages securing the cross-collateralization. See “Risk Factors—Some Provisions in the Mortgage Loans Underlying Your Offered
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Certificates May Be Challenged as Being Unenforceable—Cross-Collateralization Arrangements” in the prospectus.
In addition, when multiple real properties secure a mortgage loan, the amount of the mortgage encumbering any particular one of those properties may be less than the full amount of the related aggregate mortgage loan indebtedness, to minimize recording tax. This mortgage amount is generally established at 100% to 150% of the appraised value or allocated loan amount for the mortgaged property and will limit the extent to which proceeds from the property will be available to offset declines in value of the other properties securing the same mortgage loan.
See “Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans” in this prospectus supplement for a description of mortgage loans that are cross-collateralized and cross-defaulted with each other, if any, or that are secured by multiple properties owned by multiple borrowers.
The Performance of a Mortgage Loan and Its Related Mortgaged Property Depends in Part on Who Controls the Borrower and Mortgaged Property
The operation and performance of a mortgage loan (or loan combination) will depend in part on the identity of the persons or entities who control the related borrower and the related mortgaged property. The performance of a mortgage loan (or loan combination) may be adversely affected if control of a borrower changes, which may occur, for example, by means of transfers of direct or indirect ownership interests in the borrower, or if the mortgage loan (or loan combination) is assigned to and assumed by another person or entity along with a transfer of the property to that person or entity.
Many of the mortgage loans generally place certain restrictions on the transfer and/or pledging of general partnership and managing member equity interests in a borrower such as specific percentage or control limitations, although there is already existing mezzanine debt, and mezzanine debt is permitted in the future, in the case of certain mortgage loans. We cannot assure you the ownership of any of the borrowers would not change during the term of the related mortgage loan and result in a material adverse effect on your certificates. See “Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness” and “—Certain Terms of the Mortgage Loans—’Due-On-Sale’ and ‘Due-On-Encumbrance’ Provisions” in this prospectus supplement.
The Borrower’s Form of Entity May Cause Special Risks
The borrowers are legal entities rather than individuals. Mortgage loans made to legal entities may entail greater risks of loss than those associated with mortgage loans made to individuals. For example, a legal entity, as opposed to an individual, may be more inclined to seek legal protection from its creditors under the bankruptcy laws. Unlike individuals involved in bankruptcies, most entities generally, but not in all cases, do not have personal assets and creditworthiness at stake. The terms of certain of the mortgage loans require that the borrowers be single-purpose entities, however, we cannot assure you that such borrowers will comply with such requirements. Furthermore, in many cases such borrowers are not required to observe all covenants and conditions which typically are required in order for such borrowers to be viewed under standard rating agency criteria as “special purpose entities.”
Although a borrower may currently be a single-purpose entity, in certain cases the borrowers were not originally formed as single-purpose entities, but at origination of the related mortgage loan (or loan combination, as applicable) their organizational documents were amended. That borrower may have previously owned property other than the related mortgaged property and may not have observed all covenants that typically are required to consider a borrower a “single-purpose entity” and thus may have liabilities arising from events prior to becoming a single-purpose entity. If a borrower has owned property other than the related mortgaged property, engaged in a business other than the operation of the related mortgaged property or even owned and/or operated the related mortgaged property for a material period in advance of the origination of the related mortgage loan, that borrower may be subject to liabilities arising out of its activities prior to the origination of the related mortgage loan, including liabilities that may be unrelated to the related mortgaged property. Furthermore, the bankruptcy of a borrower, or a general partner or managing member of a borrower, may impair the ability of the lender to enforce its rights and remedies under the related mortgage.
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However, any borrower, even an entity structured as a special purpose entity, as an owner of real estate, will be subject to certain potential liabilities and risks as an owner of real estate. We cannot assure you that any borrower will not file for bankruptcy protection or that creditors of a borrower or a corporate or individual general partner or managing member of a borrower will not initiate a bankruptcy or similar proceeding against such borrower or corporate or individual general partner or managing member.
Furthermore, with respect to any affiliated borrowers, creditors of a common parent in bankruptcy may seek to consolidate the assets of such borrowers with those of the parent. Consolidation of the assets of such borrowers would likely have an adverse effect on the funds available to make distributions on your certificates, and may lead to a downgrade, withdrawal or qualification of the ratings of your certificates.
In addition, borrowers may own a mortgaged property as tenants-in-common. For example, in the case of the mortgage loans secured by the mortgaged properties identified on Annex A to this prospectus supplement as Pasadena Office Tower, Orinda Square, Park at Sugar Creek and Apple Creek Apartments, representing approximately 12.7% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, the related borrowers are tenants-in-common.
In certain instances, borrowers under mortgage loans use a Delaware statutory trust structure in order to gain certain tax free exchange treatment for property of like kind under Section 1031 of the Internal Revenue Code. These borrowers can be restricted in their ability to actively operate a property, including with respect to loan work-outs, leasing and re-leasing, making material improvements and other material actions affecting the related mortgaged property. In the case of a mortgaged property that is owned by a Delaware statutory trust or by tenants-in-common, there is a risk that obtaining the consent of the holders of the beneficial interests in the Delaware statutory trust or the consent of the tenants-in-common will be time consuming and cause delays with respect to the taking of certain actions by or on behalf of the borrower, including with respect to the related mortgaged property. In a tenant-in-common ownership structure, each tenant-in-common owns an undivided share in the property. Absent other arrangements, a tenancy-in-common entails the risk that a bankruptcy, dissolution or action for partition by one or more of the tenants-in-common will result in significant delay in recovery against the tenant-in-common borrowers, particularly if the tenant-in-common borrowers file for bankruptcy separately or in series (because each time a tenant-in-common borrower files for bankruptcy, the bankruptcy court stay will be reinstated), a material impairment in property management, a substantial decrease in the amount recoverable upon the related mortgage asset and/or early repayment of the related mortgage asset. Although the conditions to a conversion to a tenancy-in-common include arrangements intended to lessen these risks, such as waivers of the right to partition, we cannot assure you that such arrangements are in all cases implemented or, if challenged, would be enforced. See “Risk Factors—The Borrower’s Form of Entity May Cause Special Risks and/or Hinder Recovery” in the prospectus.
See “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—Single-Purpose Entity Covenants” and “Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans—Tenancies-in-Common” in this prospectus supplement, and “Certain Legal Aspects of the Mortgage Loans—Bankruptcy Issues” in the prospectus.
A Bankruptcy Proceeding May Result in Losses and Delays in Realizing on the Mortgage Loans
Numerous statutory provisions, including the Bankruptcy Code and state laws affording relief to debtors, may interfere with and delay the ability of a secured mortgage lender to obtain payment of a loan, to realize upon collateral and/or to enforce a deficiency judgment. For example, under the Bankruptcy Code, virtually all actions (including foreclosure actions and deficiency judgment proceedings) are automatically stayed upon the filing of a bankruptcy petition, and, often, no interest or principal payments are made during the course of the bankruptcy proceeding. Also, under federal bankruptcy law, the filing of a petition in bankruptcy by or on behalf of a junior lien holder may stay the senior lender from taking action to foreclose out such junior lien. Certain of the mortgage loans have sponsors that have previously filed bankruptcy and we cannot assure you that such sponsors will not be more likely than other sponsors to utilize their rights in bankruptcy in the event of any threatened action by the mortgagee to enforce its rights under the related mortgage loan documents. As a result, the issuing entity’s recovery with respect to borrowers in bankruptcy proceedings may be significantly delayed, and the aggregate amount ultimately collected may be substantially less than the amount owed. See “—Other Financings or Ability to Incur Other Financings Entails Risk” below, “Description of the Mortgage Pool—Default History, Bankruptcy Issues and Other Proceedings” in this prospectus supplement and “Certain Legal Aspects of the Mortgage Loans—Bankruptcy Issues” in the prospectus.
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Additionally, the courts of any state may refuse the foreclosure of a mortgage or deed of trust when an acceleration of the indebtedness would be inequitable or unjust or the circumstances would render the action unconscionable. See “Certain Legal Aspects of the Mortgage Loans—Foreclosure” in the prospectus.
Additionally, in February 2012, a bill was passed by the Georgia Senate and introduced in the Georgia State House of Representatives that would limit rights of holders that acquired loans for less than par, by limiting the amount that a purchaser of debt (including the issuing entity) could collect from a guarantor of a commercial mortgage loan to the lesser of the purchase price paid for the debt or the maximum amount of the guarantee. The bill would apply both retroactively and prospectively to all types of loans made to all types of borrowers and presumably to the mortgage loans. If enacted, legislation of this type would appear to interfere with established contractual rights, and as such may be unconstitutional insofar as it would be applied to debt sold or transferred prior to the legislation’s enactment date. This type of measure could undermine the value of the mortgage loans and the special servicer’s workout efforts including, without limitation, the ability to collect on a guaranty or to use the threat of the same as a mechanism to compel a borrower to engage in a workout or provide a deed-in-lieu of foreclosure. The legislative session of the Georgia State House of Representatives ended without a vote on the bill. As a result, the bill died; however, we cannot assure you that a similar bill will not be re-introduced and passed in Georgia or in any other state in future legislative sessions.
See also “—Performance of the Certificates Will Be Highly Dependent on the Performance of Tenants and Tenant Leases—Tenant Bankruptcy Could Result in a Rejection of the Related Lease” above.
Mortgage Loans Are Non-Recourse and Are Not Insured or Guaranteed
The mortgage loans are not insured or guaranteed by any person or entity, governmental or otherwise.
Investors should treat each mortgage loan as a non-recourse loan. If a default occurs, recourse generally may be had only against the specific properties and other assets that have been pledged to secure the loan. Consequently, payment prior to maturity is dependent primarily on the sufficiency of the net operating income of the mortgaged property. Payment at maturity is primarily dependent upon the market value of the mortgaged property and the borrower’s ability to sell or refinance the mortgaged property.
Although the mortgage loans generally are non-recourse in nature, certain mortgage loans contain non-recourse carveouts for liabilities such as a result of fraud by the borrower, certain voluntary insolvency proceedings or other matters. Certain mortgage loans set forth under “Description of the Mortgage Pool—Non-Recourse Carveout Limitations” in this prospectus supplement either do not contain non-recourse carveouts or contain material limitations to non-recourse carveouts. Often these obligations are guaranteed by an affiliate of the related borrower, although liability under any such guaranty may be capped or otherwise limited in amount or scope. Furthermore, the guarantor’s net worth and liquidity may be less (and in some cases, materially less) than amounts due under the related mortgage loan or the guarantor’s sole asset may be its interest in the related borrower. Certain mortgage loans may have the benefit of a general payment guaranty of a portion of the indebtedness under the mortgage loan. In all cases, however, the mortgage loans should be considered to be non-recourse obligations because neither the depositor nor the sponsors make any representation or warranty as to the obligation or ability of any borrower or guarantor to pay any deficiencies between any foreclosure proceeds and the mortgage loan indebtedness. No mortgage loan will be insured or guaranteed by any government, governmental instrumentality, private insurer or (except as described above) other person or entity.
Adverse Environmental Conditions at or Near Mortgaged Properties May Result in Losses
The issuing entity could become liable for a material adverse environmental condition at an underlying mortgaged property. Any such potential liability could reduce or delay payments on the offered certificates. Environmental reports were prepared for the mortgaged properties as described in “Description of the Mortgage Pool—Environmental Considerations” in this prospectus supplement, however, it is possible that the environmental reports and/or supplemental “Phase II” sampling did not reveal all environmental liabilities, or that there are material environmental liabilities of which we are not aware. Also, the environmental condition of the mortgaged properties in the future could be affected by the activities of tenants and occupants or by third parties unrelated to the borrowers. For a more detailed description of environmental matters that may affect the mortgaged properties, see “Risk Factors—Environmental Liabilities Will Adversely Affect the Value and Operation of the Contaminated Property and May Deter a Lender from Foreclosing” and “Certain Legal Aspects of the Mortgage Loans—Environmental Considerations” in the prospectus.
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Risks Related to Redevelopment, Expansion and Renovation at Mortgaged Properties
Certain of the mortgaged properties are properties which are currently undergoing or, in the future, are expected to undergo redevelopment, expansion or renovation. To the extent applicable, we cannot assure you that any escrow or reserve collected will be sufficient to complete the current renovation or be otherwise sufficient to satisfy any tenant improvement expenses at a mortgaged property. Failure to complete those planned improvements may have a material adverse effect on the cash flow at the mortgaged property and the related borrower’s ability to meet its payment obligations under the related mortgage loan documents.
Certain of the hospitality properties securing the mortgage loans are currently undergoing or are scheduled to undergo renovations or property improvement plans (“PIPs”). In some circumstances, these renovations or PIPs may necessitate taking a portion of the available guest rooms temporarily offline, temporarily decreasing the number of available rooms and the revenue generating capacity of the related hotel. In other cases, these renovations may involve renovations of common spaces or external features of the related hotel, which may cause disruptions or otherwise decrease the attractiveness of the related hotel to potential guests. These PIPs may be required under the related franchise or management agreement and a failure to timely complete them may result in a termination or expiration of a franchise or management agreement and may be an event of default under the related mortgage loan.
Certain of the retail properties securing the mortgage loans are currently undergoing or are scheduled to undergo renovations or property expansions. Such renovations or expansions may be required under one or more tenant leases and a failure to timely complete such renovations or expansions may result in a termination of any such lease and may have a material adverse effect on the cash flow at any such mortgaged property and the related borrower’s ability to meet its payment obligations under the related mortgage loan documents.
We cannot assure you that current or planned redevelopment, expansion or renovation will be completed, that such redevelopment, expansion or renovation will be completed in the time frame contemplated, or that, when and if redevelopment, expansion or renovation is completed, such redevelopment, expansion or renovation will improve the operations at, or increase the value of, the related mortgaged property. Failure of any of the foregoing to occur could have a material negative impact on the related mortgaged property, which could affect the ability of the related borrower to repay the related mortgage loan.
In the event the related borrower fails to pay the costs for work completed or material delivered in connection with such ongoing redevelopment, expansion or renovation, the portion of the mortgaged property on which there are renovations may be subject to mechanics’ or materialmen’s liens that may be senior to the lien of the related mortgage loan.
The existence of construction or renovation at a mortgaged property may make such mortgaged property less attractive to tenants or their customers, and accordingly could have a negative effect on net operating income. See “Description of the Mortgage Pool—Redevelopment, Expansion and Renovation” in this prospectus supplement for information regarding mortgaged properties which are currently undergoing or, in the future, are expected to undergo redevelopment or renovation.
Risks Relating to Costs of Compliance with Applicable Laws and Regulations
A borrower may be required to incur costs to comply with various existing and future federal, state or local laws and regulations applicable to the related mortgaged property, for example, zoning laws and the Americans With Disabilities Act of 1990, as amended, which requires all public accommodations to meet certain federal requirements related to access and use by persons with disabilities. See “Risk Factors—Compliance with the Americans with Disabilities Act of 1990 May Be Expensive” and “Certain Legal Aspects of the Mortgage Loans—Americans with Disabilities Act” in the prospectus. The expenditure of these costs or the imposition of injunctive relief, penalties or fines in connection with the borrower’s noncompliance could negatively impact the borrower’s cash flow and, consequently, its ability to pay its mortgage loan.
Litigation Regarding the Mortgaged Properties or Borrowers May Impair Your Distributions
There may be (and there may exist from time to time) pending or threatened legal proceedings against, or disputes with, the borrowers, the property sponsors and the managers of the mortgaged properties and their respective affiliates arising out of their ordinary business. We have not undertaken a search for all legal
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proceedings that relate to the borrowers, property sponsors or managers for the mortgaged properties and their respective affiliates. Potential investors are advised and encouraged to perform their own searches related to such matters to the extent relevant to their investment decision. Any such litigation or dispute may materially impair distributions to certificateholders if borrowers or property sponsors must use property income or other income to pay judgments, legal fees or litigation costs. We cannot assure you that any litigation or dispute or any settlement of any litigation or dispute will not have a material adverse effect on your investment.
In addition, in the event the owner of a borrower experiences financial problems, we cannot assure you that such owner would not attempt to take actions with respect to the mortgaged property that may adversely affect the borrower’s ability to fulfill its obligations under the related mortgage loan. See “Description of the Mortgage Pool—Litigation Considerations” in this prospectus supplement for information regarding litigation matters with respect to certain mortgage loans.
Other Financings or Ability to Incur Other Financings Entails Risk
When a borrower (or its constituent members) also has one or more other outstanding loans (even if they arepari passu, subordinated, mezzanine or unsecured loans or another type of equity pledge), the issuing entity is subjected to additional risk such as:
· | the borrower (or its constituent members) may have difficulty servicing and repaying multiple loans; |
· | the existence of another loan will generally also make it more difficult for the borrower to obtain refinancing of the related mortgage loan (or loan combination, if applicable) or sell the related mortgaged property and may thereby jeopardize repayment of the mortgage loan (or loan combination, if applicable); |
· | the need to service additional debt may reduce the cash flow available to the borrower to operate and maintain the mortgaged property and the value of the mortgaged property may decline as a result; |
· | if a borrower (or its constituent members) defaults on its mortgage loan and/or any other loan, actions taken by other lenders such as a suit for collection, foreclosure or an involuntary petition for bankruptcy against the borrower could impair the security available to the issuing entity, including the mortgaged property, or stay the issuing entity’s ability to foreclose during the course of the bankruptcy case; |
· | the bankruptcy of another lender also may operate to stay foreclosure by the issuing entity; and |
· | the issuing entity may also be subject to the costs and administrative burdens of involvement in foreclosure or bankruptcy proceedings or related litigation. |
With respect to any split mortgage loan, although each related companion loan is not an asset of the issuing entity, the related borrower is still obligated to make interest and principal payments on each related companion loan. As a result, the issuing entity is subject to additional risks, including:
· | the risk that the necessary maintenance of the related mortgaged property could be deferred to allow the borrower to pay the required debt service on these other obligations and that the value of the mortgaged property may fall as a result; and |
· | the risk that it may be more difficult for the borrower to refinance these loans or to sell the related mortgaged property for purposes of making any balloon payment on the entire balance of such loans and the related additional debt at maturity. |
With respect to mezzanine financing, while a mezzanine lender has no security interest in the related mortgaged properties, a default under a mezzanine loan could cause a change in control of the related borrower. With respect to mortgage loans that permit mezzanine financing, the relative rights of the mortgagee and the related mezzanine lender will generally be set forth in an intercreditor agreement, which agreements typically provide that the rights of the mezzanine lender (including the right to payment) against the borrower and
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mortgaged property are subordinate to the rights of the mortgage lender and that the mezzanine lender may not take any enforcement action against the mortgage borrower and mortgaged property.
In addition, the mortgage loan documents related to certain mortgage loans may allow the related borrower to employ so-called “preferred equity” structures, where one or more special limited partners or members receive a preferred return in exchange for an infusion of capital or other type of equity pledge that may require payments of excess cash flow. Such arrangements can present risks that resemble mezzanine debt, including dilution of the sponsor’s equity in the mortgaged property, stress on the cash flow in the form of a preferred return or excess cash payments, and/or potential changes in the management of the related mortgaged property in the event the preferred return is not satisfied.
For additional information, see“Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness”, “—The Loan Combinations” and “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
Risks of Anticipated Repayment Date Loans
One (1) mortgage loan, representing approximately 13.8% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, provides that, if after a certain date (referred to as an anticipated repayment date) the related borrower has not prepaid such mortgage loan in full, any principal outstanding after the related anticipated repayment date will accrue interest at an increased interest rate rather than the original mortgage loan rate for such mortgage loan. Generally, from and after the anticipated repayment date for such mortgage loan, cash flow in excess of that required for debt service, the funding of reserves, other amounts then due and payable under the related mortgage loan documents (other than “excess interest”) and certain budgeted or non-budgeted expenses approved by the related lender with respect to the related mortgaged property will be applied toward the payment of principal (without payment of a yield maintenance charge or other prepayment premium) of such mortgage loan until its principal balance has been reduced to zero. Although these provisions may create an incentive for the related borrower to repay such mortgage loan in full on its anticipated repayment date, a substantial payment would be required and such borrower has no obligation to do so. While interest at the original mortgage loan rate continues to accrue and be payable on a current basis on such mortgage loan after its anticipated repayment date, the payment of excess interest will be deferred and will be required to be paid (if and to the extent permitted under applicable law and the related mortgage loan documents), only after the outstanding principal balance of such mortgage loan has been paid in full, at which time the excess interest that has been deferred, to the extent actually collected, will be paid to the holders of the Class S certificates, which are not offered by this prospectus supplement.
A Borrower May Be Unable to Repay Its Remaining Principal Balance on the Maturity Date or Anticipated Repayment Date; Longer Amortization Schedules and Interest-Only Provisions Increase Risk
Mortgage loans with substantial remaining principal balances at their maturity date or anticipated repayment date, as applicable, involve greater risk than fully-amortizing mortgage loans. This is because the borrower may be unable to repay the mortgage loan at that time. In addition, fully amortizing mortgage loans which may pay interest on an “actual/360” basis but have fixed monthly payments may, in effect, have a small balloon payment due at maturity.
All of the mortgage loans have amortization schedules that are significantly longer than their respective terms to maturity (or, if applicable, any related anticipated repayment date), and many of the mortgage loans require only payments of interest for part or all of such respective terms. See “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—Due Dates; Mortgage Loan Rates; Calculations of Interest” in this prospectus supplement. A longer amortization schedule or an interest-only provision in a mortgage loan will result in a higher amount of principal outstanding under the mortgage loan at any particular time, including at the maturity date (or, if applicable, anticipated repayment date) of the mortgage loan, than would have otherwise been the case had a shorter amortization schedule been used or had the mortgage loan had a shorter interest-only period or not included an interest-only provision at all. That higher principal amount outstanding could both (i) make it more difficult for the related borrower to make the required balloon payment at maturity and (ii) lead to increased losses for the issuing entity either during the loan term or at maturity if the mortgage loan becomes a defaulted mortgage loan.
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A borrower’s ability to repay a mortgage loan (or loan combination) on its maturity date or anticipated repayment date, as applicable, typically will depend upon its ability either to refinance the mortgage loan (or loan combination) or to sell the mortgaged property at a price sufficient to permit repayment. A borrower’s ability to achieve either of these goals will be affected by a number of factors, including:
· | the availability of, and competition for, credit for commercial, multifamily or manufactured housing community real estate projects, which fluctuate over time; |
· | the prevailing interest rates; |
· | the net operating income generated by the mortgaged property; |
· | the fair market value of the related mortgaged property; |
· | the borrower’s equity in the related mortgaged property; |
· | significant tenant rollover at the related mortgaged properties (see “Risk Factors—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks—Retail Properties” and “—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks—Office Properties” in the prospectus); |
· | the borrower’s financial condition; |
· | the operating history and occupancy level of the mortgaged property; |
· | reductions in applicable government assistance/rent subsidy programs; |
· | the tax laws; and |
· | prevailing general and regional economic conditions. |
With respect to any split mortgage loan, the risks relating to balloon payment obligations are enhanced by the existence of the related companion loan(s).
Whether or not losses are ultimately sustained, any delay in the collection of a balloon payment on the maturity date or anticipated repayment date that would otherwise be distributable on your certificates will likely extend the weighted average life of your certificates.
None of the sponsors, any party to the pooling and servicing agreement or any other person will be under any obligation to refinance any mortgage loan. However, in order to maximize recoveries on defaulted mortgage loans, the pooling and servicing agreement permits the special servicer (and each outside servicing agreement governing the servicing of an outside serviced mortgage loan permits the related outside special servicer) to extend and modify mortgage loans in a manner consistent with the applicable servicing standard, subject to the limitations (or, in the case of an outside serviced mortgage loan, limitations of the type) described under “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Modifications, Waivers and Amendments” in this prospectus supplement. We cannot assure you, however, that any extension or modification will increase the present value of recoveries in a given case.
Neither the master servicer nor the special servicer will have the ability to extend or modify an outside serviced mortgage loan because each outside serviced mortgage loan is being serviced pursuant to the applicable outside servicing agreement. Whether or not losses are ultimately sustained, any delay in collection of a balloon payment that would otherwise be distributable in respect of a class of certificates, whether such delay is due to a borrower default or to modification of an outside serviced mortgage loan by the outside special servicer, will likely extend the weighted average life of such class of certificates.
The credit crisis and economic downturn have resulted in tightened lending standards and a reduction in capital available to refinance commercial mortgage loans at maturity. These factors have increased the risk that
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refinancing may not be available for commercial mortgage loans. We cannot assure you that each borrower under a balloon loan will have the ability to repay the principal balance of such mortgage loan on the related maturity date or anticipated repayment date, as applicable.
See “Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans” in this prospectus supplement.
Risks Relating to Interest on Advances and Special Servicing Compensation
To the extent described in this prospectus supplement, the master servicer and the trustee will each be entitled to receive interest on unreimbursed advances made by it at the “Prime Rate” as published inThe Wall Street Journal. This interest will generally accrue from the date on which the related advance is made or the related expense is incurred to the date of reimbursement. In addition, under certain circumstances, including delinquencies in the payment of principal and/or interest, a mortgage loan will be specially serviced and the special servicer (or, with respect to an outside serviced mortgage loan, the outside special servicer) will be entitled to compensation for special servicing activities. The right to receive interest on advances or special servicing compensation is senior to the rights of certificateholders to receive distributions on the offered certificates. The payment of interest on advances and the payment of compensation to the special servicer may lead to shortfalls in amounts otherwise distributable on your certificates.
Increases in Real Estate Taxes May Reduce Available Funds
Certain of the mortgaged properties securing the mortgage loans have or may in the future have the benefit of reduced real estate taxes in connection with a local government “payment in lieu of taxes” program (often known as a “PILOT” program) or other tax abatement arrangements. Upon expiration of such program or if such programs were otherwise terminated, the related borrower would be required to pay higher, and in some cases substantially higher, real estate taxes. Prior to expiration of such program, the tax benefit to the mortgaged property may decrease throughout the term of the expiration date until the expiration of such program. An increase in real estate taxes may impact the ability of the borrower to pay debt service on the mortgage loan.
See “Description of the Mortgage Pool—Real Estate and Other Tax Considerations” in this prospectus supplement for descriptions of real estate tax matters relating to certain mortgaged properties.
Some Mortgaged Properties May Not Be Readily Convertible to Alternative Uses
Some of the mortgaged properties securing the mortgage loans included in the issuing entity may not be readily convertible (or convertible at all) to alternative uses if those properties were to become unprofitable for any reason. For example, a mortgaged property may not be readily convertible due to restrictive covenants related to such mortgaged property, including in the case of mortgaged properties that are subject to a condominium regime or subject to a ground lease, the use and other restrictions imposed by the condominium declaration and other related documents, especially in a situation where a mortgaged property does not represent the entire condominium regime. Additionally, any vacancy with respect to self storage facilities, hospitality properties, independent living facilities, bowling alleys, restaurants, shopping malls, water parks, theater space, dental or medical offices, health clubs, martial arts studios, gas stations, data centers and warehouses would not be easily converted to other uses due to their unique construction requirements. In addition, converting commercial properties to alternate uses generally requires substantial capital expenditures and could result in a significant adverse effect on, or interruption of, the revenues generated by such properties.
In addition, the limited adaptability of certain shopping malls that have proven unprofitable may result in high (and possibly extremely high) loss severities on mortgage loans secured by those shopping malls. For example, it is possible that a significant amount of advances made by the applicable servicer(s) of a mortgage loan secured by a shopping mall property, combined with low liquidation proceeds in respect of that property, may result in a loss severity exceeding 100% of the outstanding principal balance of that mortgage loan.
Condominium interests in buildings and/or other improvements in some cases constitute less than a majority of voting rights and result in the related borrower not having control of the related condominium or owners association. The board of managers or directors of the related condominium generally has discretion to make decisions affecting the condominium, and we cannot assure you that the related borrower under a mortgage loan secured by one or more interests in that condominium will have any control over decisions made by the related
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board of managers or directors. Thus, decisions made by that board of managers or directors, including regarding assessments to be paid by the unit owners, insurance to be maintained on the condominium and many other decisions affecting the maintenance of that condominium, may have a significant impact on the related mortgage loans that are secured by mortgaged properties consisting of such condominium interests. We cannot assure you that the related board of managers or directors will always act in the best interests of the related borrower under the related mortgage loans. In addition, with respect to each such mortgage loan, there are certain circumstances when insurance proceeds must be used to repair and restore the related mortgaged property in accordance with the terms of the governing documents for the related condominium.
In addition, due to the nature of condominiums, a default on the part of the borrower with respect to such mortgaged properties will not allow the special servicer the same flexibility in realizing on the collateral as is generally available with respect to commercial properties that are not condominium units. The rights of other unit or property owners, the documents governing the management of the condominium units and the state and local laws applicable to condominium units must be considered. In addition, in the event of a casualty with respect to a condominium, due to the possible existence of multiple loss payees on any insurance policy covering such property, there could be a delay in the allocation of related insurance proceeds, if any. Consequently, servicing and realizing upon the collateral consisting of condominium interests could subject the certificateholders to a greater delay, expense and risk than with respect to a mortgage loan secured by a commercial property that is not a condominium unit.
Furthermore, certain properties may be subject to certain low-income housing restrictions in order to remain eligible for low-income housing tax credits or governmental subsidized rental payments that could prevent the conversion of the mortgaged property to alternative uses. The liquidation value of any mortgaged property, subject to limitations of the kind described above or other limitations on convertibility of use, may be substantially less than would be the case if the property were readily adaptable to other uses. See “Risk Factors—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks—Multifamily Rental Properties” in the prospectus.
Zoning or other restrictions also may prevent alternative uses. See “—Risks Related to Zoning Non-Compliance and Use Restrictions” below.
Risks Related to Zoning Non-Compliance and Use Restrictions
Certain of the mortgaged properties may not comply with current zoning laws, including density, use, parking, height, landscaping, open space and set back requirements, due to changes in zoning requirements after such mortgaged properties were constructed. These properties, as well as those for which variances or special permits were issued or for which non-conformity with current zoning laws is otherwise permitted, are considered to be a “legal non-conforming use” and/or the improvements are considered to be “legal non-conforming structures.” This means that the borrower is not required to alter its structure to comply with the existing or new law; however, the borrower may not be able to rebuild the premises “as-is” in the event of a substantial casualty loss. This may adversely affect the cash flow of the property following the loss. If a substantial casualty were to occur, we cannot assure you that insurance proceeds would be available to pay the mortgage loan in full. In addition, if a non-conforming use were to be discontinued and/or the property were repaired or restored in conformity with the current law, the value of the property or the revenue producing potential of the property may not be equal to that before the casualty.
In addition, certain of the mortgaged properties that do not conform to current zoning laws may not be “legal non-conforming uses” or “legal non-conforming structures.” The failure of a mortgaged property to comply with zoning laws or to be a “legal non-conforming use” or “legal non-conforming structure” may adversely affect the market value of the mortgaged property or the borrower’s ability to continue to use it in the manner it is currently being used or may necessitate material additional expenditures to remedy non-conformities. In some cases, the related borrower has obtained law and ordinance insurance to cover additional costs that result from rebuilding or building improvements at the mortgaged property in accordance with current zoning requirements. However, if as a result of the applicable zoning laws the rebuilt improvements are smaller or less attractive to tenants than the original improvements, the resulting loss in income will generally not be covered by law and ordinance insurance.
In addition, certain of the mortgaged properties may be subject to certain use restrictions and/or operational requirements imposed pursuant to development agreements, ground leases, restrictive covenants, reciprocal easement agreements or operating agreements or historical landmark designations or, in the case of those
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mortgaged properties that are condominiums, condominium declarations or other condominium use restrictions or regulations, especially in a situation where the mortgaged property does not represent the entire condominium building. Such use restrictions could include, for example, limitations on the character of the improvements or the properties, limitations affecting noise and parking requirements, among other things, and limitations on the borrowers’ right to operate certain types of facilities within a prescribed radius. These limitations impose upon the borrower stricter requirements with respect to repairs and alterations, including following a casualty loss. These limitations could adversely affect the ability of the related borrower to lease the mortgaged property on favorable terms, thus adversely affecting the borrower’s ability to fulfill its obligations under the related mortgage loan.
See“Description of the Mortgage Pool—Zoning and Use Restrictions” in this prospectus supplement for examples of mortgaged properties that are subject to restrictions relating to the use of the mortgaged properties or have other material zoning issues.
Risks Relating to Inspections of Properties
Licensed engineers or consultants inspected the mortgaged properties at or about the time of the origination of the mortgage loans to assess items such as structural integrity of the buildings and other improvements on the mortgaged property, including exterior walls, roofing, interior construction, mechanical and electrical systems and general condition of the site, buildings and other improvements. However, we cannot assure you that all conditions requiring repair or replacement were identified. No additional property inspections were conducted in connection with the closing of the offered certificates.
Earthquake, Flood and Other Insurance May Not Be Available or Adequate
Although the mortgaged properties are required to be insured, or self-insured by a sole tenant of a related building or group of buildings, against certain risks, there is a possibility of casualty loss with respect to the mortgaged properties for which insurance proceeds may not be adequate or which may result from risks not covered by insurance.
Furthermore, with respect to certain mortgage loans, the insurable value of the related mortgaged property as of the origination date of the related mortgage loan was lower than the principal balance of the related mortgage loan. In the event of a casualty when a borrower is not required to rebuild or cannot rebuild, we cannot assure you that the insurance required with respect to the related mortgaged property will be sufficient to pay the related mortgage loan in full and there is no “gap” insurance required under such mortgage loan to cover any difference. In those circumstances, a casualty that occurs near the maturity date may result in an extension of the maturity date of the mortgage loan if the special servicer, in accordance with the servicing standard, determines that such extension was in the best interest of certificateholders.
In addition, certain types of mortgaged properties, such as manufactured housing and recreational vehicle communities, have few or no insurable buildings or improvements and thus do not have casualty insurance or low limits of casualty insurance in comparison with the related mortgage loan balances.
In addition, hazard insurance policies will typically contain co-insurance clauses that in effect require an insured at all times to carry insurance of a specified percentage, generally 80% to 90%, of the full replacement value of the improvements on the related mortgaged property in order to recover the full amount of any partial loss. As a result, even if insurance coverage is maintained, if the insured’s coverage falls below this specified percentage, those clauses generally provide that the insurer’s liability in the event of partial loss does not exceed the lesser of (1) the replacement cost of the improvements less physical depreciation and (2) that proportion of the loss as the amount of insurance carried bears to the specified percentage of the full replacement cost of those improvements.
Twenty-two (22) of the mortgaged properties, securing approximately 28.1% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date by allocated loan amount, are located in areas that are considered a high earthquake risk (seismic zones 3 or 4). Seismic reports were prepared with respect to these mortgaged properties, and based on those reports, no mortgaged property has a seismic expected loss of greater than 20.6% (however, one of the buildings included in the mortgaged property identified on Annex A to this prospectus supplement as 11145 and 11165 Commercial Parkway has a seismic expected loss of 22.0%).
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The mortgage loans do not require flood insurance on the related mortgaged properties unless they are in a flood zone and flood insurance is available; and, in certain instances, even where the related mortgaged property was in a flood zone and flood insurance was available, flood insurance was not required.
We cannot assure you that the borrowers will in the future be able to comply with requirements to maintain adequate insurance with respect to the mortgaged properties, and any uninsured loss could have a material adverse impact on the amount available to make payments on the related mortgage loan, and consequently, the offered certificates. As with all real estate, if reconstruction (for example, following fire or other casualty) or any major repair or improvement is required to the damaged property, changes in laws and governmental regulations may be applicable and may materially affect the cost to, or ability of, the borrowers to effect such reconstruction, major repair or improvement. As a result, the amount realized with respect to the mortgaged properties, and the amount available to make payments on the related mortgage loan, and consequently, the offered certificates, could be reduced. In addition, we cannot assure you that the amount of insurance required or provided would be sufficient to cover damages caused by any casualty, or that such insurance will be available in the future at commercially reasonable rates.
Terrorism Insurance May Not Be Available for All Mortgaged Properties
The occurrence or the possibility of terrorist attacks could (1) lead to damage to one or more of the mortgaged properties if any terrorist attacks occur or (2) result in higher costs for security and insurance premiums or diminish the availability of insurance coverage for losses related to terrorist attacks, particularly for large properties, which could adversely affect the cash flow at those mortgaged properties.
After the September 11, 2001 terrorist attacks in New York City and the Washington, D.C. area, all forms of insurance were impacted, particularly from a cost and availability perspective, including comprehensive general liability and business interruption or rent loss insurance policies required by typical mortgage loans. To give time for private markets to develop a pricing mechanism for terrorism risk and to build capacity to absorb future losses that may occur due to terrorism, the Terrorism Risk Insurance Act of 2002 was enacted on November 26, 2002, establishing the Terrorism Insurance Program. The Terrorism Insurance Program was extended through December 31, 2014 by the Terrorism Risk Insurance Program Reauthorization Act of 2007 and was subsequently reauthorized on January 12, 2015 for a period of six years through December 31, 2020 pursuant to the Terrorism Risk Insurance Program Reauthorization Act of 2015 (“TRIPRA”).
The Terrorism Insurance Program requires insurance carriers to provide terrorism coverage in their basic “all-risk” policies. Any commercial property and casualty terrorism insurance exclusion that was in force on November 26, 2002 is automatically void to the extent that it excluded losses that would otherwise be insured losses. Any state approval of those types of exclusions in force on November 26, 2002 is also void.
Under the Terrorism Insurance Program, the federal government shares in the risk of losses occurring within the United States resulting from acts committed in an effort to influence or coerce United States civilians or the United States government. The federal share of compensation for insured losses of an insurer equals 85% (subject to annual 1% decreases beginning in 2016 until such percentage equals 80%) of the portion of such insured losses that exceed a deductible equal to 20% of the value of the insurer’s direct earned premiums over the calendar year immediately preceding that program year. Federal compensation in any program year is capped at $100 billion (with insurers being liable for any amount that exceeds such cap), and no compensation is payable with respect to a terrorist act unless the aggregate industry losses relating to such act exceed $100 million (subject to annual $20 million increases beginning in 2016 until such threshold equals $200 million). The Terrorism Insurance Program does not cover nuclear, biological, chemical or radiological attacks. Unless a borrower obtains separate coverage for events that do not meet the thresholds or other requirements above, such events will not be covered.
If the Terrorism Insurance Program is not reenacted after its expiration in 2020, premiums for terrorism insurance coverage will likely increase and the terms of such insurance policies may be materially amended to increase stated exclusions or to otherwise effectively decrease the scope of coverage available (perhaps to the point where it is effectively not available). In addition, to the extent that any insurance policies contain “sunset clauses” (i.e., clauses that void terrorism coverage if the federal insurance backstop program is not renewed), then such policies may cease to provide terrorism insurance upon the expiration of the Terrorism Insurance Program. We cannot assure you that the Terrorism Insurance Program or any successor program will create any long term changes in the availability and cost of such insurance. Moreover, future legislation, including
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regulations expected to be adopted by the Treasury Department pursuant to TRIPRA, may have a material effect on the availability of federal assistance in the terrorism insurance market. In addition, the failure to maintain such terrorism insurance may constitute a default under the related mortgage loan. Even if terrorism insurance is required by the mortgage loan documents for a mortgage loan, that requirement may be subject to a cap on the cost of the premium for terrorism insurance that a borrower is required to pay or a commercially reasonable standard on the availability or cost of the insurance. See “Structural and Collateral Term Sheet” in Annex B to this prospectus supplement for a description of any requirements for terrorism insurance for the largest 10 mortgage loans by aggregate principal balance of the pool of mortgage loans as of the cut-off date. To the extent that uninsured or underinsured casualty losses occur with respect to the related mortgaged properties, losses on the mortgage loans may result.
Other mortgaged properties securing mortgage loans may also be insured under a blanket policy or self-insured or insured by a sole tenant. See “—Risks Associated with Blanket Insurance Policies or Self-Insurance” below.
We cannot assure you that terrorism insurance or the Terrorism Insurance Program will be available or provide sufficient protection against risks of loss on the mortgaged properties resulting from acts of terrorism.
As a result of any of the foregoing, the amount available to make distributions on your certificates could be reduced.
Risks Associated with Blanket Insurance Policies or Self-Insurance
Certain of the mortgaged properties are covered by blanket insurance policies, which also cover other properties of the related borrower or its affiliates (including certain properties in close proximity to the mortgaged properties). In the event that such policies are drawn on to cover losses on such other properties, the amount of insurance coverage available under such policies would thereby be reduced and could be insufficient to cover each mortgaged property’s insurable risks. In addition, with respect to some of the mortgaged properties, a sole or significant tenant is allowed to provide self-insurance against risks.
Additionally, if the mortgage loans that allow coverage under blanket insurance policies are part of a group of mortgage loans with related borrowers, then all of the related mortgaged properties may be covered under the same blanket policy, which may also cover other properties owned by affiliates of such borrowers.
Certain mortgaged properties may also be insured or self-insured by a sole or significant tenant, as further described under “Description of the Mortgage Pool—Insurance Considerations” in this prospectus supplement.
State and Local Mortgage Recording Taxes May Apply Upon a Foreclosure or Deed-in-Lieu of Foreclosure and Reduce Net Proceeds
Many jurisdictions impose recording taxes on mortgages which, if not paid at the time of the recording of the mortgage, may impair the ability of the lender to foreclose the mortgage. Such taxes, interest, and penalties could be significant in amount and would, if imposed, reduce the net proceeds realized by the issuing entity in liquidating the real property securing the related mortgage loan.
The Mortgage Loan Sellers, the Sponsors and the Depositor Are Subject to Bankruptcy or Insolvency Laws That May Affect the Issuing Entity’s Ownership of the Mortgage Loans
In the event of the bankruptcy, insolvency, receivership or conservatorship of an originator, a mortgage loan seller or the depositor (or certain affiliates thereof), it is possible that the issuing entity’s right to payment from or ownership of certain of the mortgage loans could be challenged. If such challenge is successful, payments on the offered certificates would be reduced or delayed. Even if the challenge is not successful, payments on the offered certificates would be delayed while a court resolves the claim.
An opinion of counsel will be rendered on the closing date to the effect that the transfer of the applicable mortgage loans by the mortgage loan sellers to the depositor would generally be respected as a sale in the event of the bankruptcy or insolvency of such mortgage loan sellers. Such opinions, however, are subject to various assumptions and qualifications, and there can be no assurance that a bankruptcy trustee, if applicable, or other
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interested party will not attempt to challenge the issuing entity’s right to payment with respect to the related mortgage loans. Legal opinions do not provide any guaranty as to what any particular court would actually decide, but rather an opinion as to the decision a court would reach if the issues were competently presented and the court followed existing precedent as to legal and equitable principles applicable in bankruptcy cases. In this regard, legal opinions on bankruptcy law matters have inherent limitations primarily because of the pervasive equity powers of bankruptcy courts, the overriding goal of reorganization to which other legal rights and other policies may be subordinated, the potential relevance to the exercise of judicial discretion of future arising facts and circumstances, and the nature of the bankruptcy process. As a result, the Federal Deposit Insurance Corporation (the “FDIC”), a creditor, a bankruptcy trustee or another interested party, including an entity transferring a mortgage loan as debtor-in-possession, could still attempt to assert that the transfer of a mortgage loan was not a sale. If such party’s challenge were successful, payments on the certificates would be reduced or delayed. Even if the challenge were not successful, payments on the certificates would be delayed while a court resolves the claim.
Goldman Sachs Mortgage Company, a sponsor and an originator, is an indirect, wholly-owned subsidiary of Goldman Sachs Bank USA (“GS Bank”), a New York State chartered bank, the deposits of which are insured by the FDIC. If GS Bank were to become subject to receivership, the proceeding would be administered by the FDIC under the Federal Deposit Insurance Act (the “FDIA”); likewise, if GS Bank were to become subject to conservatorship, the agency appointed as conservator would likely be the FDIC as well. The FDIA gives the FDIC the power to disaffirm or repudiate contracts to which a bank is party at the time of receivership or conservatorship and the performance of which the FDIC determines to be burdensome, in which case the counterparty to the contract has a claim for payment by the receivership or conservatorship estate of “actual direct compensatory damages” as of the date of receivership or conservatorship.
The FDIC has adopted a rule, substantially revised and effective January 1, 2011, establishing a safe harbor (the “FDIC Safe Harbor”) from its repudiation powers for securitizations meeting the requirements of the rule (12 C.F.R. § 360.6). The transfer of the applicable mortgage loans by Goldman Sachs Mortgage Company to the depositor will not qualify for the FDIC Safe Harbor. However, the transfer by Goldman Sachs Mortgage Company is not a transfer by a bank, and in any event, even if the FDIC Safe Harbor were applicable to such transfer, the FDIC Safe Harbor is non-exclusive.
The issuing entity has been organized as a common law trust, and as such is not eligible to be a “debtor” under the federal bankruptcy laws. If the issuing entity were instead characterized as a “business trust” it could qualify as a debtor under those laws. Bankruptcy courts look at various considerations in making this determination, so it is not possible to predict with any certainty whether or not the issuing entity would be characterized as a “business trust.” If a bankruptcy court were to determine that the issuing entity was a “business trust”, it is possible that payments on the certificates would be delayed while the court resolved the issue.
Furthermore, Title II of the Dodd-Frank Act provides for an orderly liquidation authority (“OLA”) under which the FDIC can be appointed as receiver of certain systemically important non-bank financial companies and their direct or indirect subsidiaries in certain cases. We make no representation as to whether this would apply to any of the sponsors. In January 2011, a former acting general counsel of the FDIC issued a letter in which he expressed his view that, under then-existing regulations, the FDIC, as receiver under the OLA, would not, in the exercise of its OLA repudiation powers, recover as property of a financial company assets transferred by the financial company,provided that the transfer satisfies the conditions for the exclusion of assets from the financial company’s estate under the bankruptcy code. The letter further noted that, while the FDIC staff may be considering recommending further regulations under OLA, such former acting general counsel would recommend that such regulations incorporate a 90 day transition period for any provisions affecting the FDIC’s statutory power to disaffirm or repudiate contracts. If, however, the FDIC were to adopt a different approach than that described in such former acting general counsel’s letter, delays or reductions in payments on the offered certificates would occur. As such, we cannot assure you that a bankruptcy would not result in a delay or reduction in payments on the certificates.
Interests and Incentives of the Originators, the Sponsors and Their Affiliates May Not Be Aligned with Your Interests
The originators, the sponsors and their affiliates (including certain of the underwriters) expect to derive ancillary benefits from this offering and their respective incentives may not be aligned with those of purchasers of the offered certificates. The sponsors originated or purchased the mortgage loans in order to securitize the
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mortgage loans by means of a transaction such as the offering of the offered certificates. The sponsors will sell the mortgage loans to the depositor (an affiliate of Citigroup Global Markets Realty Corp., one of the sponsors, and Citigroup Global Markets Inc., one of the underwriters) on the closing date in exchange for cash, derived from the sale of the offered certificates to investors and/or in exchange for offered certificates. A completed offering would reduce the originators’ exposure to the mortgage loans. The originators made the mortgage loans with a view toward securitizing them and distributing the exposure by means of a transaction such as this offering of offered certificates. In addition, certain mortgaged properties may have tenants that are affiliated with the related originator. See “Description of the Mortgage Pool—Tenant Issues—Affiliated Leases” in this prospectus supplement. This offering of offered certificates will effectively transfer the originators’ exposure to the mortgage loans to purchasers of the offered certificates.
The originators, the sponsors and their affiliates expect to receive various benefits, including compensation, commissions, payments, rebates, remuneration and business opportunities, in connection with or as a result of this offering of offered certificates and their interests in the mortgage loans. The sponsors and their affiliates will effectively receive compensation, and may record a profit, in an amount based on, among other things, the amount of proceeds (net of transaction expenses) received from the sale of the offered certificates to investors relative to their investment in the mortgage loans. The benefits to the originators, the sponsors and their affiliates arising from the decision to securitize the mortgage loans may be greater than they would have been had other assets been selected.
Furthermore, the sponsors and/or their affiliates may benefit from a completed offering of the offered certificates because the offering would establish a market precedent and a valuation data point for securities similar to the offered certificates, thus enhancing the ability of the sponsors and their affiliates to conduct similar offerings in the future and permitting them to adjust the fair value of the mortgage loans or other similar assets or securities held on their balance sheet, including increasing the carrying value or avoiding decreasing the carrying value of some or all of such similar positions.
In addition, the originators, the sponsors or any of their respective affiliates may benefit from certain relationships, including financial dealings, with any borrower, any non-recourse carveout guarantor or any of their respective affiliates, aside from the origination of mortgage loans or contribution of mortgage loans into this securitization transaction.
The originators and/or their respective affiliates may have originated and sold or retained mezzanine loans and/or companion loans (or may in the future originate permitted mezzanine loans) related to the mortgage loans. Such transactions may cause the originators and their affiliates or their clients or counterparties who purchase the mezzanine loans and/or companion loans, as applicable, to have economic interests and incentives that do not align with, and that may be directly contrary to, those of an investor in the offered certificates. In addition, these transactions or actions taken to maintain, adjust or unwind any positions in the future, may, individually or in the aggregate, have a material effect on the market for the offered certificates (if any), including adversely affecting the value of the offered certificates, particularly in illiquid markets. The originators, the sponsors and their affiliates will have no obligation to take, refrain from taking or cease taking any action with respect to a mezzanine loan based on the potential effect on an investor in the offered certificates, and may receive substantial returns from these transactions.
In connection with the foregoing, it should be noted that, on the closing date, RAIT Partnership, L.P., an affiliate of RAIT Funding, LLC, is the holder of the mezzanine loan related to the mortgage loan secured by the mortgaged property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, representing approximately 4.1% of the aggregate principal balance of the mortgage pool as of the cut-off date.
In some cases, the originators or their affiliates may be the holders of companion loans related to their mortgage loans. For example, Goldman Sachs Mortgage Company, an originator and a sponsor, is the current holder of one of the Selig Office Portfolio companion loans and one of the Dallas Market Center companion loans. Any holder of any such pari passu companion loan will have certain consultation rights with respect to servicing decisions involving the related outside serviced loan combination. However, neither the outside servicer nor the outside special servicer will be required to take or to refrain from taking any action pursuant to the advice, recommendations or instructions from the holder of a pari passu companion loan or its representative, or due to any failure to approve an action by any such party, or due to an objection by any such party that would cause either the outside servicer or the outside special servicer to violate applicable law, the related mortgage loan documents, the outside servicing agreement (including the servicing standard), any related co-lender agreement
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or intercreditor agreement or the REMIC provisions of the Code. See “Description of the Mortgage Pool—Statistical Characteristics of Mortgage Loans—Additional Indebtedness”and “—The Loan Combinations” in this prospectus supplement for more information regarding the rights of any serviced companion loan holder.
Further, various originators, sponsors and their respective affiliates are acting in multiple capacities in or with respect to this transaction, which may include, without limitation, acting as one or more transaction parties or a subcontractor or vendor thereof, participating in interim servicing and/or custodial arrangements with certain transaction parties, providing warehouse financing to, or receiving warehouse financing from, certain other originators or sponsors prior to transfer of the related mortgage loans to the issuing entity, performing certain underwriting services for the originators on a contractual basis and/or conducting due diligence on behalf of an investor with respect to the underlying mortgage loans prior to their transfer to the issuing entity. For a description of certain of the foregoing relationships and arrangements, see “Transaction Parties—Certain Affiliations and Certain Relationships” in this prospectus supplement.
These roles and other potential relationships may give rise to conflicts of interest as described above and under “—Interests and Incentives of the Underwriter Entities May Not Be Aligned with Your Interests,” “—Potential Conflicts of Interest in the Selection of the Underlying Mortgage Loans” and “—Other Potential Conflicts of Interest May Affect Your Investment” below. Each of the foregoing relationships and related interests should be considered carefully by you before you invest in any offered certificates.
Interests and Incentives of the Underwriter Entities May Not Be Aligned with Your Interests
The activities and interests of the underwriters and their respective affiliates (collectively, the “Underwriter Entities”) will not align with, and may in fact be directly contrary to, those of the certificateholders. The Underwriter Entities are each part of separate global investment banking, securities and investment management firms that provide a wide range of financial services to a substantial and diversified client base that includes corporations, financial institutions, governments and high-net-worth individuals. As such, they actively make markets in and trade financial instruments for their own account and for the accounts of customers. These financial instruments include debt and equity securities, currencies, commodities, bank loans, indices, baskets and other products. The Underwriter Entities’ activities include, among other things, executing large block trades and taking long and short positions directly and indirectly, through derivative instruments or otherwise. The securities and instruments in which the Underwriter Entities take positions, or expect to take positions, include loans similar to the mortgage loans, securities and instruments similar to the offered certificates and other securities and instruments. Market making is an activity where the Underwriter Entities buy and sell on behalf of customers, or for their own account, to satisfy the expected demand of customers. By its nature, market making involves facilitating transactions among market participants that have differing views of securities and instruments. Any short positions taken by the Underwriter Entities and/or their clients through marketing or otherwise will increase in value if the related securities or other instruments decrease in value, while positions taken by the Underwriter Entities and/or their clients in credit derivative or other derivative transactions with other parties, pursuant to which the Underwriter Entities and/or their clients sell or buy credit protection with respect to one or more classes of the offered certificates, may increase in value if the offered certificates default, are expected to default, or decrease in value. The Underwriter Entities and their clients acting through them may execute such transactions, modify or terminate such derivative positions and otherwise act with respect to such transactions, and may exercise or enforce, or refrain from exercising or enforcing, any or all of their rights and powers in connection therewith, without regard to whether any such action might have an adverse effect on the offered certificates or the certificateholders. Additionally, none of the Underwriter Entities will have any obligation to disclose any of these securities or derivatives transactions to you in your capacity as a certificateholder. As a result, you should expect that the Underwriter Entities will take positions that are inconsistent with, or adverse to, the investment objectives of investors in the offered certificates.
As a result of the Underwriter Entities’ various financial market activities, including acting as a research provider, investment advisor, market maker or principal investor, you should expect that personnel in various businesses throughout the Underwriter Entities will have and express research or investment views and make recommendations that are inconsistent with, or adverse to, the objectives of investors in the offered certificates.
If an Underwriter Entity becomes a holder of any of the certificates, through market-making activity or otherwise, any actions that it takes in its capacity as a certificateholder, including voting, providing consents or otherwise will not necessarily be aligned with the interests of other holders of the same class or other classes of the certificates. To the extent an Underwriter Entity makes a market in the certificates (which it is under no
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obligation to do), it would expect to receive income from the spreads between its bid and offer prices for the certificates. The price at which an Underwriter Entity may be willing to purchase certificates, if it makes a market, will depend on market conditions and other relevant factors and may be significantly lower than the issue price for the certificates and significantly lower than the price at which it may be willing to sell certificates.
In addition, none of the Underwriter Entities will have any obligation to monitor the performance of the certificates or the actions of the master servicer, the special servicer, the certificate administrator, the operating advisor or the trustee and will have no authority to advise the master servicer, the special servicer, the certificate administrator, the operating advisor or the trustee or to direct their actions.
Furthermore, each Underwriter Entity expects that a completed offering will enhance its ability to assist clients and counterparties in the transaction or in related transactions (including assisting clients in additional purchases and sales of the certificates and hedging transactions). The Underwriter Entities expect to derive fees and other revenues from these transactions. In addition, participating in a successful offering and providing related services to clients may enhance the Underwriter Entities’ relationships with various parties, facilitate additional business development, and enable them to obtain additional business and generate additional revenue.
The Underwriter Entities are playing several roles in this transaction. Citigroup Global Markets Inc., one of the underwriters, is an affiliate of Citigroup Commercial Mortgage Securities Inc., the depositor, Citigroup Global Markets Realty Corp., a sponsor and an originator, and Citibank, N.A., the certificate administrator, certificate registrar and paying agent. In addition, Goldman, Sachs & Co., one of the underwriters, is an affiliate of Goldman Sachs Mortgage Company, a sponsor, an originator and the current holder of one of the Selig Office Portfolio companion loans and one of the Dallas Market Center companion loans, and GS Commercial Real Estate LP, an originator.
See “Transaction Parties—Certain Affiliations and Certain Relationships” in this prospectus supplement and “Plan of Distribution (Underwriter Conflicts of Interest)” in this prospectus supplement for a description of certain affiliations and relationships between the underwriters and other participants in this offering. Each of those affiliations and foregoing relationships should be considered carefully by you before you invest in any certificates.
Potential Conflicts of Interest of the Master Servicer, the Special Servicer, the Trustee, any Outside Servicer and any Outside Special Servicer
The pooling and servicing agreement provides that the mortgage loans serviced thereunder are required to be administered in accordance with the servicing standard without regard to ownership of any certificate by the master servicer or the special servicer or any of their respective affiliates. See “The Pooling and Servicing Agreement—Servicing of the Mortgage Loans” in this prospectus supplement. Each outside servicing agreement provides that the related outside serviced loan combination is required to be administered in accordance with a servicing standard set forth therein. See “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
Notwithstanding the foregoing, the master servicer, the special servicer or any of their respective sub-servicers and, as it relates to servicing and administration of any outside serviced loan combination, any outside servicer, any outside special servicer, or any of their respective sub-servicers, may have interests when dealing with the mortgage loans that are in conflict with those of holders of the certificates, especially if:
· | as it relates to the servicing and administration of mortgage loans under the pooling and servicing agreement, the master servicer, the special servicer, a sub-servicer or any of their respective affiliates holds certificates of this securitization transaction or any commercial mortgage-backed securities that evidence an interest in or are secured by the assets of an issuing entity, which assets include a serviced companion loan (or a portion of or interest in a serviced companion loan) (such securities, “serviced companion loan securities”); or |
· | as it relates to servicing and administration of any outside serviced loan combination under the related outside servicing agreement, any related outside servicer, any related outside special servicer, a sub-servicer or any of their respective affiliates, holds certificates of this securitization transaction or any securitization involving a companion loan in such outside serviced loan combination; |
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or, in any case, any of the foregoing parties or any of their respective affiliates has financial interests in or financial dealings with an applicable borrower, any of its affiliates or a sponsor. Each of these relationships may create a conflict of interest. For example, if the special servicer or its affiliate holds a subordinate class of certificates or serviced companion loan securities, the special servicer might seek to reduce the potential for losses allocable to those certificates or serviced companion loan securities from the applicable specially serviced loans by deferring acceleration in hope of maximizing future proceeds. However, that action could result in less proceeds to the issuing entity than would be realized if earlier action had been taken. Furthermore, none of the master servicer, the special servicer or a sub-servicer is required to act in a manner more favorable to the holders of offered certificates or any particular class of offered certificates than to the holders of Series 2015-GC31 non-offered certificates, any serviced companion loan holder or the holder of any serviced companion loan securities.
Each of the master servicer and the special servicer services and is expected to continue to service, in the ordinary course of its business, existing and new mortgage loans for third parties, or itself or its affiliates, including portfolios of mortgage loans similar to the mortgage loans included in the issuing entity. The real properties securing these other mortgage loans may be in the same markets as, and compete with, or have owners, obligors or property managers in common with, certain of the mortgaged properties securing the mortgage loans that will be included in the issuing entity. As a result of the services described above, the interests of each of the master servicer and the special servicer and each of its affiliates and their clients may differ from, and conflict with, the interests of the issuing entity. Consequently, personnel of the master servicer or the special servicer, as applicable, may perform services, on behalf of the issuing entity, with respect to the mortgage loans at the same time as they are performing services, on behalf of other persons, with respect to other mortgage loans secured by properties that compete with the mortgaged properties securing the mortgage loans included in the issuing entity. This may pose inherent conflicts for the master servicer or the special servicer.
The special servicer may enter into one or more arrangements with the controlling class representative, a directing holder, a controlling class certificateholder or other certificateholders or a companion loan holder (or an affiliate or a third-party representative of one or more of the preceding) to provide for a discount and/or revenue sharing with respect to certain of the special servicer compensation in consideration of, among other things, the special servicer’s appointment (or continuance) as special servicer under the pooling and servicing agreement and/or the co-lender agreements and limitations on the right of such person to replace the special servicer. The master servicer may enter into an agreement with a sponsor to purchase the servicing rights to the related mortgage loans and/or the right to be appointed as the master servicer with respect to such mortgage loans. Any person that enters into such an economic arrangement with the master servicer or special servicer, as the case may be, may be influenced by such economic arrangement when deciding whether to appoint such master servicer or whether to appoint or replace such special servicer from time to time, and such consideration would not be required to take into account the best interests of the certificateholders or any group of certificateholders. See “—Other Potential Conflicts of Interest May Affect Your Investment” below.
Further, the master servicer, the special servicer, the certificate administrator, the trustee and their respective affiliates are acting in multiple capacities in or related to this transaction, which may include, without limitation, participating in interim servicing and/or custodial arrangements with certain transaction parties, providing warehouse financing to certain originators or sponsors prior to transfer of their related mortgage loans to the issuing entity, and/or conducting due diligence on behalf of an investor with respect to the underlying mortgage loans prior to their transfer to the issuing entity. For a description of certain of the foregoing relationships and arrangements, see “Transaction Parties—Certain Affiliations and Certain Relationships” in this prospectus supplement. Also see “—Interests and Incentives of the Underwriter Entities May Not Be Aligned with Your Interests” above and “—Potential Conflicts of Interest in the Selection of the Underlying Mortgage Loans” and “—Other Potential Conflicts of Interest May Affect Your Investment” below.
Similarly, with respect to the outside serviced mortgage loans, conflicts described above may arise with respect to an outside servicer, an outside special servicer, a sub-servicer, or any of their respective affiliates.
Each of the foregoing relationships should be considered carefully by you before you invest in any certificates.
Potential Conflicts of Interest of the Operating Advisor
Pentalpha Surveillance LLC, a limited liability company organized under the laws of Delaware, has been appointed as the initial operating advisor. See “Transaction Parties—The Operating Advisor” in this prospectus supplement. After the occurrence and during the continuance of a Control Termination Event, the operating
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advisor will be required to consult on a non-binding basis with the special servicer with respect to certain actions of the special servicer in respect of the applicable specially serviced mortgage loan(s) and/or companion loan(s);provided that the operating advisor may consult regarding a serviced outside controlled loan combination only if and to the extent that the holder of the related split mortgage loan is granted consultation rights under the related co-lender agreement. Additionally, after the occurrence and during the continuance of a Control Termination Event, the master servicer or the special servicer, as applicable, will be required to use commercially reasonable efforts consistent with the servicing standard to collect an operating advisor consulting fee from the related borrower in connection with a major decision with respect to the applicable serviced mortgage loan(s) and/or serviced companion loan(s), to the extent not prohibited by the related mortgage loan documents. In acting as operating advisor, the operating advisor is required to act solely on behalf of the issuing entity, in the best interest of, and for the benefit of, the certificateholders (as a collective whole as if such certificateholders (and, if applicable, any related serviced pari passu companion loan holder) constituted a single lender) and will have no fiduciary duty to any party. See “The Pooling and Servicing Agreement—Operating Advisor” in this prospectus supplement.
In the normal course of conducting its business, Pentalpha Surveillance LLC and its affiliates have rendered services to, performed surveillance of, and negotiated with, numerous parties engaged in activities related to structured finance and commercial mortgage securitization. These parties may have included institutional investors, the depositor, the sponsors, the mortgage loan sellers, the originators, the certificate administrator, the trustee, the master servicer, the special servicer, a directing holder, a companion loan holder, the controlling class representative or collateral property owners or affiliates of any of those parties. These relationships may continue in the future. Each of these relationships, to the extent they exist, may involve a conflict of interest with respect to Pentalpha Surveillance LLC’s duties as operating advisor. We cannot assure you that the existence of these relationships and other relationships in the future will not impact the manner in which Pentalpha Surveillance LLC performs its duties under the pooling and servicing agreement.
In addition, Pentalpha Surveillance LLC and its affiliates may have duties with respect to existing and new commercial and multifamily mortgage loans for third parties, or itself or its affiliates, including portfolios of mortgage loans similar to the mortgage loans included in the issuing entity. The real properties securing these other mortgage loans may be in the same markets as, and compete with, or have owners, obligors or property managers in common with, certain of the mortgaged properties securing the mortgage loans that will be included in the issuing entity. As a result of the duties described above, the interests of Pentalpha Surveillance LLC and its affiliates and their clients may differ from, and conflict with, the interests of the issuing entity. Consequently, personnel of Pentalpha Surveillance LLC may perform services on behalf of the issuing entity with respect to the mortgage loans included in the issuing entity, at the same time as they are performing services on behalf of other persons with respect to other mortgage loans secured by properties that may compete with the mortgaged properties securing the mortgage loans included in the issuing entity. This may pose inherent conflicts of interest for Pentalpha Surveillance LLC. Although the operating advisor is required to consider the servicing standard in connection with its activities under the pooling and servicing agreement, the operating advisor will not itself be bound by the servicing standard.
In addition, the operating advisor and its affiliates may have interests that are in conflict with those of certificateholders if the operating advisor or any of its affiliates holds certificates, or has financial interests in or financial dealings with a borrower or a parent of a borrower. Each of these relationships may also create a conflict of interest.
Potential Conflicts of Interest of a Directing Holder, any Outside Controlling Class Representative and any Companion Loan Holder
It is expected that Torchlight Investors, LLC, on behalf of one or more managed funds or accounts, will be the initial controlling class representative and initial directing holder with respect to all of the mortgage loans and loan combinations serviced under the pooling and servicing agreement (other than any serviced outside controlled loan combination).
The controlling class representative will be controlled by the controlling class certificateholders, and the holders of the controlling class will have no duty or liability to any other certificateholder. Likewise, no holder of a serviced companion loan or any representative thereof will have any duty or liability to any certificateholder. See “The Pooling and Servicing Agreement—Directing Holder” in this prospectus supplement. Any directing holder may have interests in conflict with those of some or all of the certificateholders. As a result, it is possible that
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such directing holder (for so long as it is permitted to do so (e.g., in the case of the controlling class representative, for so long as a Control Termination Event does not exist)) may direct the special servicer to take actions that conflict with the interests of holders of certain classes of the certificates. Accordingly, the special servicer may, based on such direction, take actions with respect to the applicable specially serviced mortgage loan(s) for which the special servicer is responsible that could adversely affect the holders of some or all of the classes of certificates. However, the special servicer is not permitted to take actions that are prohibited by law or violate the servicing standard or the terms of the mortgage loan documents. In addition, except as limited by certain conditions described under “The Pooling and Servicing Agreement—Termination of the Special Servicer” in this prospectus supplement, the special servicer may be removed and replaced with or without cause with respect to the applicable mortgage loan(s) and companion loan(s) serviced under the pooling and servicing agreement at any time by (and with a successor to be appointed by) the controlling class representative or other directing holder, as applicable (in the case of the controlling class representative, for so long as a Control Termination Event does not exist). See “The Pooling and Servicing Agreement—Directing Holder” and “—Termination of the Special Servicer” in this prospectus supplement.
None of the serviced subordinate companion loan holder(s), any serviced subordinate companion loan holder’s representatives, any holder of a serviced outside controlled companion loan, or any representatives of a holder of a serviced outside controlled companion will be a party to the pooling and servicing agreement, but one or more of such parties will be a third party beneficiary thereof and their rights may affect the servicing of the related mortgage loan.
Similarly, the related outside controlling class representative has, with respect to an outside serviced loan combination, certain consent and consultation rights and rights to replace the related outside special servicer under the related outside servicing agreement, and (so long as a Consultation Termination Event does not exist) the controlling class representative for this securitization transaction will have certain consultation rights with respect to such outside serviced loan combination.
Any or all of the controlling class representative for this securitization transaction, an outside controlling class representative, and the outside controlling note holder of a serviced outside controlled loan combination may have interests that are in conflict with those of any or all of the Series 2015-GC31 certificateholders, especially if the applicable party or any affiliate thereof holds certificates, or has financial interests in or other financial dealings (as lender or otherwise) with a borrower or a parent of a borrower. Each of these relationships may create a conflict of interest.
The special servicer, at the direction of or upon consultation with, as applicable, a serviced pari passu companion loan holder (or its representative), may take actions with respect to a serviced pari passu loan combination that could adversely affect the holders of some or all of the classes of the certificates, to the extent described under “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement. A serviced pari passu companion loan holder (or its representative) does not have any duty to the holders of any class of certificates and may have interests in conflict with those of the certificateholders. As a result, it is possible that a serviced pari passu companion loan holder (or its representative) may advise (or, if it is the outside controlling note holder of a serviced outside controlled loan combination, may direct) the special servicer to take actions that conflict with the interests of holders of certain classes of the certificates.
No certificateholder may take any action against the controlling class representative for this securitization transaction, any outside controlling class representative or any serviced companion loan holder (or its representative) for having acted solely in its own interests. See “Description of the Mortgage Pool—The Loan Combinations”, “The Pooling and Servicing Agreement—Directing Holder” and “The Pooling and Servicing Agreement—Termination of the Special Servicer” in this prospectus supplement.
Potential Conflicts of Interest in the Selection of the Underlying Mortgage Loans
The anticipated initial investor in the Class E, Class F, Class G, Class H and Class S certificates (the “B-Piece Buyer”) was given the opportunity by the sponsors to perform due diligence on the mortgage loans originally identified by the sponsors for inclusion in the issuing entity, and to request the removal, re-sizing or change in other features of some or all of the mortgage loans. The B-Piece Buyer may have adjusted the mortgage pool as originally proposed by the sponsors by removing or otherwise excluding certain proposed mortgage loans. In addition, the B-Piece Buyer received or may receive price adjustments or cost mitigation arrangements in connection with accepting certain mortgage loans in the mortgage pool.
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We cannot assure you that you or another investor would have made the same requests to modify the original pool as the B-Piece Buyer or that the final pool as influenced by the B-Piece Buyer’s feedback will not adversely affect the performance of your certificates and benefit the performance of the B-Piece Buyer’s certificates. Because of the differing subordination levels, the B-Piece Buyer has interests that may, in some circumstances, differ from those of purchasers of other classes of certificates, and may desire a portfolio composition that benefits the B-Piece Buyer but that does not benefit other investors. In addition, the B-Piece Buyer may enter into hedging or other transactions or otherwise have business objectives that also could cause its interests with respect to the mortgage pool to diverge from those of other purchasers of the certificates. The B-Piece Buyer performed due diligence solely for its own benefit and has no liability to any person or entity for conducting its due diligence. The B-Piece Buyer is not required to take into account the interests of any other investor in the certificates in exercising remedies or voting or other rights in its capacity as owner of the Class E, Class F, Class G, Class H and Class S certificates or in making requests or recommendations to the sponsors as to the selection of the mortgage loans and the establishment of other transaction terms. Investors are not entitled to rely on in any way the B-Piece Buyer’s acceptance of a mortgage loan. The B-Piece Buyer’s acceptance of a mortgage loan does not constitute, and may not be construed as, an endorsement of such mortgage loan, the underwriting for such mortgage loan or the originator of such mortgage loan.
The B-Piece Buyer will have no liability to any certificateholder for any actions taken by it as described in the preceding two paragraphs.
The B-Piece Buyer or its designee will constitute the initial controlling class representative and, accordingly, the initial directing holder with respect to the serviced mortgage loans and serviced companion loans other than any serviced outside controlled loan combination. The controlling class representative will have certain rights to direct and consult with the special servicer with respect to the applicable serviced loans. In addition, the controlling class representative will generally have certain consultation rights with regard to some or all of the outside serviced mortgage loans under each related co-lender agreement. See “—Potential Conflicts of Interest of a Directing Holder, any Outside Controlling Class Representative and any Companion Loan Holder” above.
Because the incentives and actions of the B-Piece Buyer may, in some circumstances, differ from or be adverse to those of purchasers of the offered certificates, you are advised and encouraged to make your own investment decision based on a careful review of the information set forth in this prospectus supplement and your own view of the mortgage pool.
Conflicts of Interest May Occur as a Result of the Rights of the Controlling Class Representative, an Outside Controlling Class Representative or a Controlling Note Holder to Terminate the Special Servicer of the Related Loan Combination
With respect to each loan combination, the controlling class representative, an outside controlling class representative or the outside controlling note holder of a serviced outside controlled loan combination, as applicable, will be entitled, under certain circumstances, to remove the special servicer for such loan combination and, in such circumstances, appoint a successor special servicer for such loan combination (or have certain consent rights with respect to such removal or replacement).
The party with this appointment power may have special relationships or interests that conflict with those of the holders of one or more classes of certificates. In addition, that party does not have any duties to the holders of any class of certificates, may act solely in its own interests, and will have no liability to any certificateholders for having done so. No certificateholder may take any action against the controlling class representative, an outside controlling class representative, or the outside controlling note holder of a serviced outside controlled companion loan, as applicable (under the pooling and servicing agreement for this securitization or any other servicing agreement), or against any other parties for having acted solely in their own respective interests. See “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement for a description of these rights to terminate a special servicer.
Other Potential Conflicts of Interest May Affect Your Investment
A special servicer (whether the initial special servicer or a successor) may enter into one or more arrangements with the controlling class representative, a controlling class certificateholder, a companion loan holder, a holder of a security backed, in whole or in part, by a companion loan, or any other certificateholders (or an affiliate or a third-party representative of one or more of the preceding) to provide for a discount and/or
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revenue sharing with respect to certain of the special servicer compensation in consideration of, among other things, the appointment (or continuance) of such special servicer under the pooling and servicing agreement and, with respect to any serviced loan combinations, the related co-lender agreement and limitations on the right of such person to replace the special servicer.
Each of the foregoing relationships should be considered carefully by you before you invest in any certificates.
The managers of the mortgaged properties and the borrowers may experience conflicts of interest in the management and/or ownership of the mortgaged properties because:
· | a substantial number of the mortgaged properties are managed by property managers affiliated with the respective borrowers; |
· | these property managers also may manage and/or franchise additional properties, including properties that may compete with the mortgaged properties; and |
· | affiliates of the managers and/or the borrowers, or the managers and/or the borrowers themselves, also may own other properties, including competing properties. |
None of the borrowers, property managers or any of their affiliates or any employees of the foregoing has any duty to favor the leasing of space in the mortgaged properties over the leasing of space in other properties, one or more of which may be adjacent to or near the mortgaged properties.
Each of the foregoing relationships should be considered carefully by you before you invest in any certificates.
Your Lack of Control Over the Issuing Entity and Servicing of the Mortgage Loans Can Create Risks
Except as described below, you and other certificateholders generally do not have a right to vote and do not have the right to make decisions with respect to the administration of the issuing entity. See “The Pooling and Servicing Agreement—General” in this prospectus supplement.
Those decisions are generally made, subject to the express terms of the pooling and servicing agreement, by the master servicer, the special servicer, the trustee or the certificate administrator, as applicable. Any decision made by one of those parties in respect of the issuing entity, even if that decision is determined to be in your best interests by that party, may be contrary to the decision that you or other certificateholders would have made and may negatively affect your interests.
Except as limited by certain conditions described under “The Pooling and Servicing Agreement—Termination of the Special Servicer” in this prospectus supplement, the special servicer (but not any outside special servicer for any outside serviced loan combination) may be removed with or without cause: (a) with respect to a serviced outside controlled loan combination, by the related outside controlling note holder; and (b) with respect to the other serviced mortgage loans and serviced companion loans, by the controlling class representative (so long as no Control Termination Event exists). See “The Pooling and Servicing Agreement—Directing Holder” and “—Termination of the Special Servicer” in this prospectus supplement.
After the occurrence and during continuance of a Control Termination Event, the holders of at least 25% of the voting rights of the certificates (other than the Class S and Class R certificates) may request a vote to replace the special servicer under the pooling and servicing agreement (except with respect to a serviced outside controlled loan combination). The subsequent vote may result in the termination and replacement of the special servicer if (within 180 days of the initial request for that vote) the holders of (a) at least 75% of the voting rights of the certificates (other than the Class S and Class R certificates), or (b) more than 50% of the voting rights of each class of certificates other than the Class X-A, Class S and Class R certificates (but, for purposes of this clause (b), considering only those classes of certificates that have, in each such case, an outstanding certificate principal amount, as notionally reduced by any appraisal reduction amounts then allocable to the subject class of certificates, equal to or greater than 25% of an amount equal to (i) the initial certificate principal amount of such class of certificatesminus (ii) payments of principal previously made with respect to such class of certificates, and considering each class of the Class A-S, Class B and Class C certificates together with the Class PEZ certificates’ applicable percentage interest of the related Class A-S, Class B or Class C trust component as a single “Class”
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for such purpose) vote affirmatively to so terminate and replace. In addition, after the occurrence and during the continuance of a Consultation Termination Event, the operating advisor may recommend the replacement of the special servicer (with respect to the applicable mortgage loan(s) and companion loan(s) serviced under the pooling and servicing agreement); provided that the operating advisor may not recommend the removal of the special servicer with respect to a serviced outside controlled loan combination without the consent of the related controlling note holder. That recommendation may result in the termination and replacement of the special servicer (with respect to the applicable mortgage loan(s) and companion loan(s)) if (within 180 days of the initial request for a vote) the holders of more than 50% of the voting rights of each class of certificates other than the Class X-A, Class S and Class R certificates (but considering only those classes of certificates that have, in each such case, an outstanding certificate principal amount, as notionally reduced by any appraisal reduction amounts then allocable to the subject class of certificates, equal to or greater than 25% of an amount equal to (i) the initial certificate principal amount of such class of certificatesminus (ii) payments of principal previously made with respect to such class of certificates, and considering each class of the Class A-S, Class B and Class C certificates together with the Class PEZ certificates’ applicable percentage interest of the related Class A-S, Class B or Class C trust component as a single “Class” for such purpose) vote affirmatively to so terminate and replace. See “Description of the Mortgage Pool—The Loan Combinations”, “The Pooling and Servicing Agreement—Termination of the Special Servicer” and “—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
The outside special servicer for any outside serviced loan combination will be subject to removal and replacement by the related outside controlling class representative or in connection with a securityholder vote generally in a manner similar to that contemplated by the preceding two paragraphs, in each case subject to certain conditions provided in the related outside servicing agreement and the related co-lender agreement.
In addition, a directing holder will have certain consent and/or consultation rights with respect to the applicable mortgage loan(s) and companion loan(s) under the pooling and servicing agreement under certain circumstances, as described in this prospectus supplement;provided,however, that a directing holder may lose any such rights upon the occurrence of certain events. See “The Pooling and Servicing Agreement—Directing Holder” in this prospectus supplement. Similarly, any outside controlling class representative may have certain consent and consultation rights with respect to the related outside serviced loan combination under the outside servicing agreement and the related co-lender agreement, which (in the case of an outside controlling class representative) it may lose upon the occurrence of certain events specified in the outside servicing agreement. See “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement.
In addition, while there is an operating advisor with certain obligations in respect of reviewing the compliance of the special servicer with certain of its obligations under the pooling and servicing agreement, the operating advisor (i) has no control rights over actions by the special servicer at any time, (ii) has no ability to communicate with, or directly influence the actions of, the borrowers at any time, (iii) has no consultation rights over actions by the special servicer prior to the occurrence and continuance of a Control Termination Event, (iv) has no consultation rights in connection with a serviced outside controlled loan combination unless consultation rights are granted to the issuing entity as holder of the related split mortgage loan and (v) has no consultation rights in connection with the outside serviced loan combinations, and the special servicer is under no obligation at any time to act upon any of the operating advisor’s recommendations. In addition, the operating advisor only has the limited obligations and duties set forth in the pooling and servicing agreement, and has no fiduciary duty, has no other duty except with respect to its specific obligations under the pooling and servicing agreement and has no duty or liability to any particular class of certificates or any certificateholder. It is not intended that the operating advisor act as a surrogate for the certificateholders. Investors should not rely on the operating advisor to monitor the actions of any directing holder or special servicer, other than to the limited extent specifically required in respect of certain actions of the special servicer at certain prescribed times under the pooling and servicing agreement, or to affect the special servicer’s actions under the pooling and servicing agreement.
In certain limited circumstances, certificateholders have the right to vote on matters affecting the issuing entity. In some cases these votes are by certificateholders taken as a whole and in others the vote is by class. In all cases voting is based on the outstanding certificate principal amount (or outstanding notional amount, as applicable), which is reduced (or indirectly reduced in the case of a notional amount) by realized losses. In certain cases with respect to the termination of the special servicer and the operating advisor, certain voting rights will also be reduced by appraisal reduction amounts. These limitations on voting could adversely affect your ability to protect your interests with respect to matters voted on by certificateholders. You have no rights to vote
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on any servicing matters related to any outside serviced loan combination. See “Description of the Offered Certificates—Voting Rights” in this prospectus supplement.
Rights of the Directing Holder and the Operating Advisor Could Adversely Affect Your Investment
In connection with the taking of certain actions that would be a major decision in connection with the servicing of a specially serviced mortgage loan or, if applicable, loan combination under the pooling and servicing agreement (and, in the case of the controlling class representative, for so long as a Control Termination Event does not exist), the special servicer generally will be required to obtain the consent of the related directing holder. After the occurrence and during the continuance of a Control Termination Event, the special servicer generally will be required to consult with the controlling class representative (until the occurrence and during the continuance of a Consultation Termination Event) and the operating advisor; provided that such consultation will occur with respect to a serviced outside controlled loan combination if and to the extent that the holder of the related split mortgage loan is granted consultation rights under the related co-lender agreement. These actions and decisions include, among others, certain loan modifications, including modifications of monetary terms, foreclosure or comparable conversion of the related mortgaged property or properties, and certain sales of the mortgage loan(s) or, if applicable, loan combination(s), or any related REO property or properties for less than the outstanding principal amount plus accrued interest, fees and expenses. See “The Pooling and Servicing Agreement—Directing Holder” in this prospectus supplement for a list of actions and decisions requiring consultation with the operating advisor and/or the controlling class representative following the occurrence of a Control Termination Event. As a result of these obligations, the special servicer may take actions with respect to a serviced mortgage loan that could adversely affect the interests of investors in one or more classes of offered certificates.
You will be acknowledging and agreeing, by your purchase of offered certificates, that any directing holder: (i) may have special relationships and interests that conflict with those of holders of one or more classes of certificates; (ii) may act solely in its own interests (or, in the case of the controlling class representative, in the interests of the holders of the controlling class); (iii) does not have any duties to the holders of any class of certificates (other than, in the case of the controlling class representative, the controlling class); (iv) may take actions that favor its own interests (or, in the case of the controlling class representative, the interests of the holders of the controlling class) over the interests of the holders of one or more classes of certificates; and (v) will have no liability whatsoever (other than, in the case of the controlling class representative, to the related controlling class certificateholder(s)) for having so acted as set forth in (i) – (iv) above, and that no certificateholder may take any action whatsoever against any directing holder or any affiliate, director, officer, employee, shareholder, member, partner, agent or principal of any directing holder for having so acted.
Loan Combinations Pose Special Risks
Realization on a Mortgage Loan That Is Part of a Serviced Loan Combination May Be Adversely Affected by the Rights of the Related Serviced Companion Loan Holder
If a serviced pari passu loan combination were to become defaulted, the related co-lender agreement requires the special servicer, in the event it determines to sell the related mortgage loan in accordance with the terms of the pooling and servicing agreement, to sell the related serviced pari passu companion loan(s) together with such defaulted mortgage loan. We cannot assure you that such a required sale of a defaulted loan combination (or applicable portion thereof) would not adversely affect the ability of the special servicer to sell such mortgage loan, or the price realized for such mortgage loan, following a default on the related serviced pari passu loan combination. Further, given that, pursuant to the co-lender agreement for any such serviced pari passu loan combination (other than any such loan combination that is a serviced outside controlled loan combination), the serviced pari passu companion loan holder is not the directing holder, and the issuing entity as holder of the related mortgage loan is the directing holder (with the right to consent to material servicing decisions and replace the special servicer, subject to the conditions specified under “The Pooling and Servicing Agreement—Directing Holder” and “—Termination of the Special Servicer” in this prospectus supplement), with respect to any such serviced pari passu loan combination, the related serviced pari passu companion loan may not be as marketable as the related mortgage loan held by the issuing entity. Accordingly, if any such sale does occur with respect to the serviced pari passu loan combination, then the net proceeds realized by the certificateholders in connection with such sale may be less than would be the case if only the related mortgage loan were subject to such sale.
In the case of a serviced outside controlled loan combination, a related companion loan holder or its representative will generally have the right to consent to certain servicing actions with respect to such loan
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combination by the master servicer or special servicer, as applicable (and, in certain cases, direct the special servicer to take certain servicing actions with respect to such loan combination). In addition, for so long as a Consultation Termination Event does not exist, the controlling class representative will have non-binding consultation rights with respect to certain servicing decisions involving any serviced outside controlled loan combination.
In connection with the servicing of a serviced pari passu loan combination, the related serviced pari passu companion loan holder or its representative (if it is not otherwise exercising the rights of directing holder) will be entitled to consult with the special servicer regarding material servicing actions, including making recommendations as to alternative actions to be taken by the special servicer with respect to such serviced pari passu loan combination, and such recommended servicing actions could adversely affect the holders of some or all of the classes of certificates. The serviced pari passu companion loan holder and its representative may have interests in conflict with those of the holders of some or all of the classes of certificates, and it is possible that the serviced pari passu companion loan holder or its representative may advise the special servicer to take actions that conflict with the interests of the holders of certain classes of the certificates. Notwithstanding the foregoing, any such consultation with the serviced pari passu companion loan holder or its representative is non-binding, and in no event is the special servicer obligated at any time to follow or take any alternative actions recommended by such serviced pari passu companion loan holder (or its representative).
With respect to any serviced AB loan combination, pursuant to the terms of the pooling and servicing agreement, if such serviced AB loan combination becomes a defaulted mortgage loan, and if the special servicer determines to sell the related serviced mortgage loan, then such sale will be subject to (and the proceeds derived therefrom may be affected by) the right of the subordinate companion loan holder to purchase and cure defaults under the related defaulted mortgage loan (together with any related serviced pari passu companion loans, if any) as and to the extent described in“Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement.
With respect to any serviced AB loan combination, the holder of the related subordinate companion loan will initially have the right to consent to certain servicing actions by the master servicer or special servicer, as applicable (and, in certain cases, direct the special servicer to take certain servicing actions with respect to such serviced AB loan combination).
You will be acknowledging and agreeing, by your purchase of offered certificates, that, with respect to any mortgage loan that is part of a serviced loan combination, the related serviced companion loan holder:
· | may have special relationships and interests that conflict with those of holders of one or more classes of certificates; |
· | may act solely in its own interests, without regard to your interests; |
· | does not have any duties to any other person, including the holders of any class of certificates; |
· | may take actions that favor its interests over the interests of the holders of one or more classes of certificates; and |
· | will have no liability whatsoever for having so acted and that no certificateholder may take any action whatsoever against the serviced companion loan holder or any director, officer, employee, agent, representative or principal of the serviced companion loan holder for having so acted. |
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Rights of any Outside Controlling Class Representative Under any Outside Servicing Agreement Could Adversely Affect Your Investment
With respect to each outside serviced loan combination, the related outside controlling class representative will have rights comparable to those of the controlling class representative for this securitization transaction, and accordingly, prospective investors should consider the following:
· | An outside controlling class representative may have interests in conflict with those of the holders of some or all of the classes of certificates. |
· | With respect to any outside serviced loan combination, although the outside special servicer is not permitted to take actions which are prohibited by law or violate the servicing standard under the related outside servicing agreement or the terms of the related mortgage loan documents, it is possible that the related outside controlling class representative may direct the outside special servicer to take actions with respect to the outside serviced loan combination that conflict with the interests of the holders of certain classes of the certificates. |
You will be acknowledging and agreeing, by your purchase of offered certificates, that, with respect to any outside serviced mortgage loan, the related outside controlling class representative:
· | may have special relationships and interests that conflict with those of holders of one or more classes of certificates; |
· | may act solely in its own interests, without regard to your interests; |
· | does not have any duties to any other person, including the holders of any class of certificates; |
· | may take actions that favor its interests over the interests of the holders of one or more classes of certificates; and |
· | will have no liability whatsoever for having so acted and that no certificateholder may take any action whatsoever against such outside controlling class representative (or other controlling note holder) or any director, officer, employee, agent or principal of such outside controlling class representative (or other controlling note holder) for having so acted. |
You Will Not Have Any Control Over the Servicing of Any Outside Serviced Mortgage Loan
Each outside serviced mortgage loan is secured by one or more mortgaged properties that also secure a companion loan that is not an asset of the issuing entity and is being serviced under an outside servicing agreement, which is the pooling and servicing agreement governing the securitization of such companion loan, by the outside servicer and outside special servicer, and in accordance with the servicing standard provided for in the outside servicing agreement. Further, pursuant to the related co-lender agreement and the outside servicing agreement, the related outside controlling class representative (and not any party to our securitization transaction) has certain rights to direct and advise the outside special servicer with respect to such outside serviced loan combination (including the related outside serviced mortgage loan). As a result, you will have less control over the servicing of the outside serviced mortgage loans than you would if the outside serviced mortgage loans are being serviced by the master servicer and the special server under the pooling and servicing agreement for your certificates.
See “Description of the Mortgage Pool—The Loan Combinations” and “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
There are no serviced loan combinations, serviced companion loans, serviced outside controlled loan combinations, subordinate companion loans or AB loan combinations related to this securitization transaction and, therefore, all references in this prospectus supplement to “serviced loan combinations”, “serviced companion loans”, “serviced outside controlled loan combinations”, “subordinate companion loans”, “AB loan combinations” or any related terms should be disregarded.
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Sponsors May Not Be Able to Make Required Repurchases or Substitutions of Defective Mortgage Loans
Each sponsor is the sole warranting party in respect of the mortgage loans sold by such sponsor to us. However, RAIT Financial Trust will guarantee RAIT Funding, LLC’s repurchase and substitution obligations under the related mortgage loan purchase agreement, and KGS Holdings, L.P. will guarantee KGS-Alpha Real Estate Capital Markets, LLC’s repurchase and substitution obligations under the related mortgage loan purchase agreement, as described in “Description of the Mortgage Pool—Cures, Repurchases and Substitutions” in this prospectus supplement. Neither we nor any of our affiliates (except Citigroup Global Markets Realty Corp. in its capacity as a sponsor) are obligated to repurchase or substitute any mortgage loan in connection with either a breach of any sponsor’s representations and warranties or any document defects, if such sponsor defaults on its obligation to do so. We cannot assure you that the sponsors (or, in the case of RAIT Funding, LLC or KGS-Alpha Real Estate Capital Markets, LLC, the applicable guarantor) will have the financial ability to effect such repurchases or substitutions. In addition, the sponsors (or, in the case of RAIT Funding, LLC or KGS-Alpha Real Estate Capital Markets, LLC, the applicable guarantor) may have various legal defenses available to them in connection with a repurchase or substitution obligation. Any mortgage loan that is not repurchased or substituted and that is not a “qualified mortgage” for a REMIC may cause designated portions of the issuing entity to fail to qualify as one or more REMICs or cause the issuing entity to incur a tax. See “Description of the Mortgage Pool—Representations and Warranties” and “—Cures, Repurchases and Substitutions” in this prospectus supplement for a summary of certain representations and warranties.
Book-Entry Registration Will Mean You Will Not Be Recognized as a Holder of Record
Your certificates will be initially represented by one or more certificates registered in the name of Cede & Co., as the nominee for DTC, and will not be registered in your name. As a result, you will not be recognized as a certificateholder, or holder of record of your certificates. See “Description of the Offered Certificates—Delivery, Form, Transfer and Denomination—Book-Entry Registration” in this prospectus supplement and “Risk Factors—Problems with Book-Entry Registration”in the prospectus for a discussion of important considerations relating to not being a certificateholder of record.
Tax Matters and Changes in Tax Law May Adversely Impact the Mortgage Loans or Your Investment
Tax Considerations Relating to Foreclosure
If the issuing entity acquires a mortgaged property (or, in the case of an outside serviced mortgage loan, a beneficial interest in a mortgaged property) subsequent to a default on the related mortgage loan pursuant to a foreclosure or deed-in-lieu of foreclosure, the special servicer (or, in the case of an outside serviced mortgage loan, the related outside special servicer) would be required to retain an independent contractor to operate and manage such mortgaged property. Among other items, the independent contractor generally will not be able to perform construction work other than repair, maintenance or certain types of tenant build-outs, unless the construction was more than 10% completed when defaulted or the default of the mortgage loan becomes imminent. Any (i) net income from such operation (other than qualifying “rents from real property”) (ii) rental income based on the net profits of a tenant or sub-tenant or allocable to a service that is non-customary in the area and for the type of property involved and (iii) rental income attributable to personal property leased in connection with a lease of real property, if the rent attributable to the personal property exceeds 15% of the total rent for the taxable year, will subject the Lower-Tier REMIC to federal tax (and possibly state or local tax) on such income at the highest marginal corporate tax rate. No determination has been made whether any portion of the income from the mortgaged properties constitutes “rent from real property”. Any such imposition of tax will reduce the net proceeds available for distribution to certificateholders. The special servicer (or, in the case of an outside serviced mortgage loan, the related outside special servicer) may permit the Lower-Tier REMIC to earn “net income from foreclosure property” that is subject to tax if it determines that the net after-tax benefit to certificateholders and any related companion loan holders, as a collective whole, could reasonably be expected to be greater than under another method of operating or leasing the mortgaged property. See “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Standards for Conduct Generally in Effecting Foreclosure or the Sale of Defaulted Loans” in this prospectus supplement. In addition, if the issuing entity were to acquire one or more mortgaged properties (or, in the case of an outside serviced mortgage loan, a beneficial interest in a mortgaged property) pursuant to a foreclosure or deed-in-lieu of foreclosure, upon acquisition of those mortgaged properties (or, in the case of an outside serviced mortgage loan, a beneficial interest in a mortgaged property), the issuing entity may in certain jurisdictions, particularly in New York, be required to pay
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state or local transfer or excise taxes upon liquidation of such properties. Such state or local taxes may reduce net proceeds available for distribution to the certificateholders.
REMIC Status
If an entity intended to qualify as a REMIC fails to satisfy one or more of the REMIC provisions of the Code during any taxable year, the Code provides that such entity will not be treated as a REMIC for such year and any year thereafter. In such event, the issuing entity, including the Upper-Tier REMIC and the Lower-Tier REMIC, would likely be treated as one or more separate associations taxable as a corporation under Treasury regulations, and the offered certificates may be treated as stock interests in those associations and not as debt instruments. The Code authorizes the granting of relief from disqualification if failure to meet one or more of the requirements for REMIC status occurs inadvertently and steps are taken to correct the conditions that caused disqualification within a reasonable time after the discovery of the disqualifying event. The relief may be granted by either allowing continuation as a REMIC or by ignoring the cessation entirely. However, any such relief may be accompanied by sanctions, such as the imposition of a corporate tax on all or a portion of the REMIC’s income for the period of time during which the requirements for REMIC status are not satisfied. While the United States Department of the Treasury is authorized to issue regulations regarding the granting of relief from disqualification if the failure to meet one or more of the requirements of REMIC status occurs inadvertently and in good faith, no such regulations have been issued.
In addition, changes to REMIC restrictions on loan modifications may impact your investment in the offered certificates. See “Risk Factors—Changes to REMIC Restrictions on Loan Modifications May Impact an Investment in the Certificates” in the prospectus.
State and Other Tax Considerations
In addition to the federal income tax consequences described under the heading “Material Federal Income Tax Consequences” in the prospectus, potential purchasers should consider the state and local, and any other, tax consequences of the acquisition, ownership and disposition of the offered certificates. State, local and other tax laws may differ substantially from the corresponding federal tax law, and this prospectus supplement does not purport to describe any aspects of the tax laws of the states or localities, or any other jurisdiction, in which the mortgaged properties are located or of any other applicable state or locality or other jurisdiction.
It is possible that one or more jurisdictions may attempt to tax nonresident holders of offered certificates solely by reason of the location in that jurisdiction of the depositor, the trustee, the certificate administrator, the sponsors, a related borrower or a mortgaged property or on some other basis, may require nonresident holders of certificates to file returns in such jurisdiction or may attempt to impose penalties for failure to file such returns; and it is possible that any such jurisdiction will ultimately succeed in collecting such taxes or penalties from nonresident holders of offered certificates. We cannot assure you that holders of offered certificates will not be subject to tax in any particular state, local or other taxing jurisdiction.
If any tax or penalty is successfully asserted by any state, local or other taxing jurisdiction, none of the depositor, the sponsors, the related borrower, the trustee, the certificate administrator, the operating advisor, the master servicer or the special servicer will be obligated to indemnify or otherwise to reimburse the holders of certificates for such tax or penalty.
You should consult with your own tax advisor with respect to the various state and local, and any other, tax consequences of an investment in the offered certificates.
Combination or “Layering” of Multiple Risks May Significantly Increase Risk of Loss
Although the various risks discussed in this prospectus supplement are generally described separately, you should consider the potential effects of the interplay of multiple risk factors. Where more than one significant risk factor is present, the risk of loss to an investor in the certificates may be significantly increased.
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Description of the Mortgage Pool
General
The issuing entity with respect to the Certificates will be Citigroup Commercial Mortgage Trust 2015-GC31 (the “Issuing Entity”). The assets of the Issuing Entity will consist of a pool (the “Mortgage Pool”) of 50 fixed rate mortgage loans (collectively (including, without limitation, any REO Mortgage Loan), the “Mortgage Loans”) with an aggregate principal balance as of their respective due dates in July 2015 (the “Cut-off Date”), after deducting payments of principal due on such respective dates, of approximately $723,323,870 (with respect to each Mortgage Loan, the “Cut-off Date Balance” and, in the aggregate, the “Initial Pool Balance”). Each Mortgage Loan is (i) evidenced by one or more promissory notes or similar evidence of indebtedness (each, a “Mortgage Note”) and (ii) secured by (or, in the case of an indemnity deed of trust, backed by a guaranty that is secured by) a mortgage, deed of trust or other similar security instrument (a “Mortgage”) creating a first lien on a fee simple and/or leasehold interest in an office, mixed use, retail, multifamily, self storage, hospitality or industrial property (each, a “Mortgaged Property”) (or, in certain cases, secured by multiple Mortgages encumbering a portfolio of Mortgaged Properties). The Mortgage Loans are generally non-recourse loans. In the event of a borrower default on a non-recourse Mortgage Loan, recourse may be had only against the specific Mortgaged Property and the other limited assets securing the Mortgage Loan, and not against the borrower’s other assets.
As described under “The Trust Fund—Mortgage Loans—Loan Combinations” in the accompanying prospectus and as described in greater detail below, certain of the Mortgage Loans (each such Mortgage Loan, a “Split Mortgage Loan”) may be part of a split loan structure (a “Loan Combination”). A Loan Combination consists of the particular Split Mortgage Loan to be included in the Issuing Entity and one or more “companion loans” (each, a “Companion Loan”) that will be held outside the Issuing Entity. If a Companion Loan ispari passu in right of payment to the related Split Mortgage Loan, it may be referred to in this prospectus supplement as a “Pari Passu Companion Loan” and the related Loan Combination may be referred to in this prospectus supplement as a “Pari Passu Loan Combination”. If a Companion Loan is subordinate in right of payment to the related Split Mortgage Loan, it may be referred to in this prospectus supplement as a “Subordinate Companion Loan” and the related Loan Combination may be referred to in this prospectus supplement as an “AB Loan Combination”. If a Loan Combination includes both a Pari Passu Companion Loan and a Subordinate Companion Loan, the discussion in this prospectus supplement regarding both Pari Passu Loan Combinations and AB Loan Combinations will be applicable to such Loan Combination. The subject Split Mortgage Loan and its related Companion Loan(s) comprising any particular Loan Combination are: (i) each evidenced by one or more separate promissory notes; (ii) obligations of the same borrower(s); (iii) cross-defaulted; and (iv) collectively secured by the same mortgage(s) and/or deed(s) of trust encumbering the related Mortgaged Property or portfolio of Mortgaged Properties. Only each Split Mortgage Loan is included in the Issuing Entity. No Companion Loan is an asset of the Issuing Entity.
If a Pari Passu Loan Combination is serviced under the Pooling and Servicing Agreement for this securitization transaction, then such Pari Passu Loan Combination may be referred to in this prospectus supplement as a “Serviced Pari Passu Loan Combination” and the related Pari Passu Companion Loan may be referred to in this prospectus supplement as a “Serviced Companion Loan” or a “Serviced Pari Passu Companion Loan”. If an AB Loan Combination is serviced under the Pooling and Servicing Agreement for this securitization transaction, then such AB Loan Combination may be referred to in this prospectus supplement as a “Serviced Loan Combination” or a “Serviced AB Loan Combination” and the related Subordinate Companion Loan may be referred to in this prospectus supplement as a “Serviced Companion Loan” or a “Serviced Subordinate Companion Loan”. The holder of each Companion Loan is referred to as a “Companion Loan Holder”, the holder of each Serviced Companion Loan is referred to as a “Serviced Companion Loan Holder”, the holder of each Serviced Pari Passu Companion Loan is referred to as a “Serviced Pari Passu Companion Loan Holder” and the holder of each Serviced Subordinate Companion Loan is referred to as a “Serviced Subordinate Companion Loan Holder”.
If and for so long as the “controlling note” with respect to any Serviced Loan Combination (regardless of whether such note evidences a Pari Passu Companion Loan or a Subordinate Companion Loan) is not included in this securitization transaction, then such Serviced Loan Combination is referred to from time to time in this prospectus supplement as a “Serviced Outside Controlled Loan Combination”, the related Serviced Mortgage Loan is referred to from time to time in this prospectus supplement as a “Serviced Outside Controlled Mortgage Loan” and the related Serviced Companion Loan is referred to from time to time in this prospectus supplement as a “Serviced Outside Controlled Companion Loan”. However, a Serviced Outside Controlled Loan Combination
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may cease to be such if, by virtue of any trigger event contemplated by the related Co-Lender Agreement, the promissory note evidencing the related Split Mortgage Loan becomes the controlling note for such Loan Combination, in which case the discussion in this prospectus supplement regarding “Serviced Outside Controlled Loan Combinations” will thereafter cease to apply to the subject Loan Combination. With respect to any Loan Combination that is, and only for so long as such Loan Combination is, a Serviced Outside Controlled Loan Combination, the “Outside Controlling Note Holder” will at any time be the holder of the related controlling note (regardless of whether such note evidences a Pari Passu Companion Loan or a Subordinate Companion Loan) or such holder’s designated representative. If, with respect to any Serviced Outside Controlled Loan Combination, the related controlling note is included in a securitization trust, the pooling and servicing agreement, trust and servicing agreement or other comparable agreement for the relevant securitization will likely designate a particular party associated with that securitization, which may be, among others, a “controlling class representative” (or equivalent party), the majority holder of a particular class, a servicer or another service provider, to exercise the rights associated with the related controlling note, although the right of any such designated party to exercise some or all of such rights may terminate or shift to another designated party upon the occurrence of certain trigger events.
Each of three (3) Mortgage Loans, respectively secured by (i) the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Selig Office Portfolio (such Mortgage Loan, the “Selig Office Portfolio Mortgage Loan”), (ii) the Mortgaged Property identified on Annex A to this prospectus supplement as Dallas Market Center (such Mortgage Loan, the “Dallas Market Center Mortgage Loan”) and (iii) the Mortgaged Property identified on Annex A to this prospectus supplement as Crowne Plaza Bloomington (such Mortgage Loan, the “Crowne Plaza Bloomington Mortgage Loan”), representing approximately 9.95%, 9.9% and 1.7%, respectively, of the Initial Pool Balance, is a Split Mortgage Loan that is part of a Loan Combination.
In connection with each Split Mortgage Loan, the following statements, concepts and definitions apply for the purposes of this prospectus supplement:
(1) With respect to the Selig Office Portfolio Mortgage Loan --
· | the Pari Passu Companion Loans related to the Selig Office Portfolio Mortgage Loan are each referred to as a “Selig Office Portfolio Companion Loan,” and the Selig Office Portfolio Mortgage Loan together with the Selig Office Portfolio Companion Loans are referred to as the “Selig Office Portfolio Loan Combination”; |
· | the Selig Office Portfolio Companion Loan that is evidenced by the controlling note A-1 was contributed by Goldman Sachs Mortgage Company into the commercial mortgage securitization transaction (the “CGCMT 2015-GC29 Securitization”) relating to the issuance of the Citigroup Commercial Mortgage Trust 2015-GC29, Commercial Mortgage Pass-Through Certificates, Series 2015-GC29 (the “CGCMT 2015-GC29 Certificates”); |
· | the Selig Office Portfolio Companion Loan that is evidenced by the non-controlling note A-2 was contributed by Goldman Sachs Mortgage Company into the commercial mortgage securitization transaction (the “GSMS 2015-GC30 Securitization”) relating to the issuance of the GS Mortgage Securities Trust 2015-GC30, Commercial Mortgage Pass-Through Certificates, Series 2015-GC30 (the “GSMS 2015-GC30 Certificates”); |
· | the Selig Office Portfolio Companion Loan that is evidenced by the non-controlling note A-4 is currently held by Goldman Sachs Mortgage Company and is expected to be contributed to one or more future commercial mortgage securitization transactions; and |
· | with respect to the Selig Office Portfolio Loan Combination, any note related to Additional Permitted Debt (as described below under “—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness”) will be serviced by the CGCMT 2015-GC29 Servicer (as defined below) and/or, if necessary, the CGCMT 2015-GC29 Special Servicer (as defined below), pursuant to the CGCMT 2015-GC29 Pooling and Servicing Agreement (as defined below) and the CGCMT 2015-GC29 Pooling and Servicing Agreement will provide that the note evidencing the Additional Permitted Debt will be entitled to all of the rights and remedies afforded to a “Selig Office Portfolio Companion Loan” under the CGCMT 2015-GC29 Pooling and Servicing Agreement. |
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(2) With respect to the Dallas Market Center Mortgage Loan --
· | the Pari Passu Companion Loans related to the Dallas Market Center Mortgage Loan are each referred to as a “Dallas Market Center Companion Loan” and the Dallas Market Center Mortgage Loan together with the Dallas Market Center Companion Loans are referred to as the “Dallas Market Center Loan Combination”; |
· | the Dallas Market Center Companion Loan that is evidenced by the controlling note A-1 was contributed by Goldman Sachs Mortgage Company into the GSMS 2015-GC30 Securitization; and |
· | the Dallas Market Center Companion Loan that is evidenced by the non-controlling note A-3 is currently held by Goldman Sachs Mortgage Company and is expected to be contributed to one or more future commercial mortgage securitization transactions. |
(3) With respect to the Crowne Plaza Bloomington Mortgage Loan --
· | the Pari Passu Companion Loan related to the Crowne Plaza Bloomington Mortgage Loan is referred to as the “Crowne Plaza Bloomington Companion Loan” and the Crowne Plaza Bloomington Mortgage Loan together with the Crowne Plaza Bloomington Companion Loan are referred to as the “Crowne Plaza Bloomington Loan Combination”; and |
· | the Crowne Plaza Bloomington Companion Loan (which is evidenced by the controlling note A-1) was contributed by Citigroup Global Markets Realty Corp. to the CGCMT 2015-GC29 Securitization. |
(4) With respect to certain servicing and control matters --
· | because (i) the Selig Office Portfolio Loan Combination is being serviced pursuant to the pooling and servicing agreement for the CGCMT 2015-GC29 Securitization (the “CGCMT 2015-GC29 Pooling and Servicing Agreement”), (ii) the Dallas Market Center Loan Combination is being serviced pursuant to the pooling and servicing agreement for the GSMS 2015-GC30 Securitization (the “GSMS 2015-GC30 Pooling and Servicing Agreement”) and (iii) the Crowne Plaza Bloomington Loan Combination is being serviced pursuant to the CGCMT 2015-GC29 Pooling and Servicing Agreement, each of (i) the Selig Office Portfolio Mortgage Loan, (ii) the Dallas Market Center Mortgage Loan and (iii) the Crowne Plaza Bloomington Mortgage Loan will sometimes be referred to in this prospectus supplement as an “Outside Serviced Mortgage Loan”, each of (i) the Selig Office Portfolio Companion Loans, (ii) the Dallas Market Center Companion Loans and (iii) Crowne Plaza Bloomington Companion Loan will sometimes be referred to in this prospectus supplement as an “Outside Serviced Companion Loan”, and each of (i) the Selig Office Portfolio Loan Combination, (ii) the Dallas Market Center Loan Combination and (iii) Crowne Plaza Bloomington Loan Combination will sometimes be referred to in this prospectus supplement as an “Outside Serviced Loan Combination”; |
· | each of the CGCMT 2015-GC29 Pooling and Servicing Agreement and the GSMS 2015-GC30 Pooling and Servicing Agreement is sometimes referred to in this prospectus supplement as an “Outside Servicing Agreement”; |
· | each of the CGCMT 2015-GC29 Securitization and the GSMS 2015-GC30 Securitization is sometimes referred to in this prospectus supplement as an “Outside Securitization”; |
· | the issuing entity of the CGCMT 2015-GC29 Securitization is referred to as the “CGCMT 2015-GC29 Issuing Entity”; the issuing entity of the GSMS 2015-GC30 Securitization is referred to as the “GSMS 2015-GC30 Issuing Entity”; |
· | the master servicer for the CGCMT 2015-GC29 Securitization, which is the servicer of the Selig Office Portfolio Loan Combination and Crowne Plaza Bloomington Loan Combination under the CGCMT 2015-GC29 Pooling and Servicing Agreement, is referred to in this prospectus supplement as the “CGCMT 2015-GC29 Servicer”; the master servicer for the GSMS 2015-GC30 Securitization, which is the servicer of the Dallas Market Center Loan Combination under the GSMS 2015-GC30 |
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Pooling and Servicing Agreement, is referred to in this prospectus supplement as the “GSMS 2015- GC30 Servicer”; and each of the CGCMT 2015-GC29 Servicer and the GSMS 2015-GC30 Servicer is referred to in this prospectus supplement as an “Outside Servicer”; |
· | the special servicer for the CGCMT 2015-GC29 Securitization, which is the special servicer of the Selig Office Portfolio Loan Combination and Crowne Plaza Bloomington Loan Combination under the CGCMT 2015-GC29 Pooling and Servicing Agreement is referred to in this prospectus supplement as the “CGCMT 2015-GC29 Special Servicer”; the special servicer for the GSMS 2015-GC30 Securitization, which is the special servicer of the Dallas Market Center Loan Combination under the GSMS 2015-GC30 Pooling and Servicing Agreement is referred to in this prospectus supplement as the “GSMS 2015-GC30 Special Servicer”; and each of the CGCMT 2015-GC29 Special Servicer and the GSMS 2015-GC30 Special Servicer is referred to in this prospectus supplement as an “Outside Special Servicer ”; |
· | the trustee for the CGCMT 2015-GC29 Securitization is referred to in this prospectus supplement as the “CGCMT 2015-GC29 Trustee”; the trustee for the GSMS 2015-GC30 Securitization is referred to in this prospectus supplement as the “GSMS 2015-GC30 Trustee”; and each of the CGCMT 2015-GC29 Trustee and the GSMS 2015-GC30 Trustee is referred to in this prospectus supplement as an “Outside Trustee”; |
· | the operating advisor (or equivalent party) under each of the CGCMT 2015-GC29 Pooling and Servicing Agreement and the GSMS 2015-GC30 Pooling and Servicing Agreement is referred to in this prospectus supplement (with respect to each applicable Outside Serviced Mortgage Loan) as an “Outside Operating Advisor”; and |
· | the controlling class representative (or equivalent party) under the CGCMT 2015-GC29 Pooling and Servicing Agreement is referred to in this prospectus supplement (with respect to each applicable Outside Serviced Mortgage Loan) as the “CGCMT 2015-GC29 Controlling Class Representative”; the controlling class representative (or equivalent party) under the GSMS 2015-GC30 Pooling and Servicing Agreement is referred to in this prospectus supplement (with respect to the applicable Outside Serviced Mortgage Loan) as the “GSMS 2015-GC30 Controlling Class Representative”; and each of the CGCMT 2015-GC29 Controlling Class Representative and the GSMS 2015-GC30 Controlling Class Representative is referred to in this prospectus supplement as an “Outside Controlling Class Representative”. |
There are no Serviced Loan Combinations, Serviced Companion Loans, Serviced Outside Controlled Loan Combinations, Subordinate Companion Loans or AB Loan Combinations related to this securitization transaction and, therefore, all references in this prospectus supplement to “Serviced Loan Combinations”, “Serviced Companion Loans”, “Serviced Outside Controlled Loan Combinations”, “Subordinate Companion Loans”, “AB Loan Combinations” or any related terms should be disregarded.
See “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement.
All of the Mortgage Loans included in the Issuing Entity (other than any Outside Serviced Mortgage Loan) are also sometimes referred to in this prospectus supplement as the “Serviced Mortgage Loans”. All of the Serviced Mortgage Loans, together with any Serviced Companion Loans, are also sometimes referred to in this prospectus supplement as the “Serviced Loans”.
Of the Mortgage Loans to be included in the Issuing Entity:
· | Twenty-two (22) Mortgage Loans (the “CGMRC Mortgage Loans”), representing approximately 41.4% of the Initial Pool Balance, were originated by Citigroup Global Markets Realty Corp., a New York corporation (“CGMRC”); |
· | Seven (7) Mortgage Loans (together with the GS CRE Mortgage Loans (as defined below), the “GSMC Mortgage Loans”), representing approximately 31.9% of the Initial Pool Balance, were originated by Goldman Sachs Mortgage Company, a New York limited partnership (“GSMC”); |
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· | Nine (9) Mortgage Loans (the “Rialto Mortgage Loans”), representing approximately 12.6% of the Initial Pool Balance, were originated by Rialto Mortgage Finance, LLC, a Delaware limited liability company (“Rialto”); |
· | Six (6) Mortgage Loans (the “RAIT Mortgage Loans”), representing approximately 7.7% of the Initial Pool Balance, were originated by RAIT Funding, LLC, a Delaware limited liability company (“RAIT”); |
· | Three (3) Mortgage Loans (the “GS CRE Mortgage Loans”), representing approximately 3.5% of the Initial Pool Balance, were originated by GS Commercial Real Estate LP, a Delaware limited partnership (“GS CRE”); and |
· | Three (3) Mortgage Loans (the “KGS Mortgage Loans”), representing approximately 2.9% of the Initial Pool Balance, were originated by KGS-Alpha Real Estate Capital Markets, LLC, a Delaware limited liability company (“KGS”). |
CGMRC, GSMC, GS CRE, Rialto, RAIT and KGS are referred to in this prospectus supplement as the “Originators”. The GS CRE Mortgage Loans were originated for sale to GSMC. GSMC has acquired or will acquire the GS CRE Mortgage Loans on or prior to the Closing Date. Citigroup Commercial Mortgage Securities Inc. (the “Depositor”) will acquire the Mortgage Loans from CGMRC, GSMC, Rialto, RAIT and KGS (collectively, the “Sponsors”) on or about July 8, 2015 (the “Closing Date”). The Depositor will cause the Mortgage Loans in the Mortgage Pool to be assigned to the Trustee pursuant to the 2015-GC31 pooling and servicing agreement, dated as of July 1, 2015 (the “Pooling and Servicing Agreement”) among the Depositor, the Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator and the Trustee.
Certain Calculations and Definitions
This prospectus supplement sets forth certain information with respect to the Mortgage Loans and the Mortgaged Properties. The sum in any column of the tables presented in Annex A, Annex B and Annex C to this prospectus supplement may not equal the indicated total due to rounding. The information in Annex A, Annex B and Annex C to this prospectus supplement with respect to the Mortgage Loans (or any Loan Combination, if applicable) and the Mortgaged Properties is based upon the Mortgage Pool as it is expected to be constituted as of the close of business on the Closing Date, assuming that (i) all scheduled principal and interest payments due on or before the Cut-off Date will be made, (ii) there will be no principal prepayments on or before the Closing Date, and (iii) each Mortgage Loan with an anticipated repayment date pays in full on its related anticipated repayment date. When information presented in this prospectus supplement with respect to the Mortgaged Properties is expressed as a percentage of the Initial Pool Balance, the percentages are, in the case of multiple Mortgaged Properties securing the same Mortgage Loan, based on an allocated loan amount that has been assigned to the related Mortgaged Properties based upon one or more of the related appraised values, the related underwritten net cash flow or prior allocations reflected in the related Mortgage Loan documents as set forth on Annex A to this prospectus supplement. The statistics in Annex A, Annex B and Annex C to this prospectus supplement were primarily derived from information provided to the Depositor by each Sponsor, which information may have been obtained from the borrowers.
With respect to any Split Mortgage Loan, all debt service coverage ratio, debt yield and loan-to-value ratio information presented in this prospectus supplement is calculated and presented in a manner that reflects the aggregate indebtedness evidenced by the subject Split Mortgage Loan and any related Pari Passu Companion Loan, but without regard to any related Subordinate Companion Loan.
With respect to each Mortgaged Property, the appraisal of such Mortgaged Property, the Phase I environmental report, any Phase II environmental report and any seismic or property condition report obtained in connection with origination (each, a “Third Party Report”) were prepared prior to the date of this prospectus supplement. The information included in the Third Party Reports may not reflect the current economic, competitive, market and other conditions with respect to the Mortgaged Properties. The Third Party Reports may be based on assumptions regarding market conditions and other matters as reflected in those Third Party Reports. The opinions of value rendered by the appraisers in the appraisals are subject to the assumptions and conditions set forth in those appraisals.
“ADR” means, for any hospitality property, average daily rate.
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“Allocated Cut-off Date Loan Amount” means, in the case of Mortgage Loans secured by multiple Mortgaged Properties, the allocated Cut-off Date Balance for each Mortgaged Property based on an allocated loan amount that has been assigned to the related Mortgaged Properties based upon one or more of the related appraised values, the related underwritten net cash flow or prior allocations reflected in the related Mortgage Loan documents;provided that with respect to any Loan Combination secured by a portfolio of Mortgaged Properties, the Allocated Cut-off Date Loan Amount represents only the pro rata portion of the related Mortgage Loan principal balance amount relative to the related Loan Combination principal balance. Information presented in this prospectus supplement (including Annex A and Annex B) with respect to the Mortgaged Properties expressed as a percentage of the Initial Pool Balance reflects the Allocated Cut-off Date Loan Amount allocated to such Mortgaged Property as of the Cut-off Date.
“Annual Debt Service” means, for any Mortgage Loan or Companion Loan, the current annualized debt service payable on such Mortgage Loan or Companion Loan as of July 2015;provided that with respect to each Mortgage Loan with a partial interest-only period, the Annual Debt Service is calculated based on the debt service due under such Mortgage Loan during the amortization period. Additionally, with respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, which amortizes based on the non-standard amortization schedule set forth on Annex G of this prospectus supplement, the Annual Debt Service is calculated based on the aggregate debt service during the 12-month period commencing August 1, 2015.
“Appraised Value” means, for each of the Mortgaged Properties and any date of determination, the most current appraised value of such Mortgaged Property as determined by an appraisal of the Mortgaged Property and in accordance with MAI standards. The appraisals for certain of the Mortgaged Properties state an “as stabilized”, “as stabilized/as completed” or “prospective market value upon stabilization” value (generally in addition to an “as-is” value) for such Mortgaged Properties that assume that certain events will occur with respect to the re-leasing, renovation or other repositioning of the Mortgaged Property, and such “as stabilized”, “as stabilized/as completed” or “prospective market value upon stabilization” values may, to the extent indicated, be reflected elsewhere in this prospectus supplement, on Annex A to this prospectus supplement, and in Annex B to this prospectus supplement. For such Appraised Values and other values on a property-by-property basis, see Annex A to this prospectus supplement and the related footnotes. In addition, for certain Mortgage Loans, the LTV Ratio at Maturity/ARD was calculated based on the “as stabilized”, “as stabilized/as completed” or “prospective market value upon stabilization” value appraised value for the related Mortgaged Property, as described under the definition of LTV Ratio at Maturity/ARD. With respect to each Mortgaged Property, the Appraised Value set forth in this prospectus supplement and on Annex A or Annex B to this prospectus supplement is the “as-is” appraised value unless otherwise specified below and under “Description of the Mortgage Pool—Appraised Value” in this prospectus supplement, and is in each case as determined by an appraisal made not more than 4 months prior to the origination date of the related Mortgage Loan, as described under “Appraisal Date” on Annex A to this prospectus supplement.
In the following cases, the Appraised Value set forth in this prospectus supplement and on Annex A or Annex B to this prospectus supplement is calculated as set forth below:
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Rockside Road Office Portfolio, representing approximately 4.1% of the Initial Pool Balance, the related Appraised Value of the portfolio of Mortgaged Properties taken as a whole includes, in each applicable circumstance, a 5.0% premium over the sum of the applicable Appraised Values of the individual Mortgaged Properties included in such portfolio (regardless of whether any such individual Appraised Value is, depending on the purpose for which it is being used, an “as-is” or “as stabilized” value); and |
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as NY Seven Self Storage Portfolio, representing approximately 2.8% of the Initial Pool Balance, the related Appraised Value of the portfolio of Mortgaged Properties taken as a whole includes an approximately 7.5% premium over the sum of the Appraised Values of the individual Mortgaged Properties included in such portfolio. |
“ARD” means, with respect to any Mortgage Loan or Companion Loan, any related Anticipated Repayment Date.
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“Balloon Balance” means, with respect to any Mortgage Loan or Companion Loan, the principal balance scheduled to be due on such Mortgage Loan or Companion Loan at maturity or any related Anticipated Repayment Date assuming that all monthly debt service payments are timely received and there are no prepayments or defaults.
“Crossed Group” identifies each group of Mortgage Loans in the Mortgage Pool that are cross-collateralized and cross-defaulted with each other, if any. Each Crossed Group, if any, is identified by a separate letter on Annex A to this prospectus supplement.
“Cut-off Date LTV Ratio” or “Cut-off Date Loan-to-Value Ratio” generally means, with respect to any Mortgage Loan, the ratio, expressed as a percentage of (1) the Cut-off Date Balance of that Mortgage Loan set forth on Annex A to this prospectus supplement divided by (2) the Appraised Value of the related Mortgaged Property or Mortgaged Properties set forth on Annex A to this prospectus supplement, except as set forth below:
· | with respect to any Split Mortgage Loan with a Pari Passu Companion Loan, the calculation of the Cut-off Date LTV Ratio is based on the aggregate principal balance of such Split Mortgage Loan and the related Pari Passu Companion Loan(s); |
· | with respect to any Split Mortgage Loan with a Subordinate Companion Loan, the calculation of the Cut-off Date LTV Ratio does not include the principal balance of the related Subordinate Companion Loan; |
· | with respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Crowne Plaza Bloomington, representing approximately 1.7% of the Initial Pool Balance, unless otherwise indicated in this prospectus supplement, the Cut-off Date LTV Ratio is calculated based on the appraiser’s “as-is” value of $31,900,000, plus an amount equal to $3,689,846, representing the estimated cost to complete of the related PIP at the Mortgaged Property. A reserve of $4,612,308 was established in connection with the PIP, representing approximately 125% of the estimated remaining costs of the PIP. The Cut-off Date LTV Ratio for such Mortgage Loan based solely on the “as-is” appraised value is 81.8%; |
· | with respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Stonegate at Stillwater, representing approximately 0.9% of the Initial Pool Balance, unless otherwise indicated in this prospectus supplement, the Cut-off Date LTV Ratio is calculated based on the Cut-off Date Balance of $6,300,000 less an $825,000 reserve established at origination, to be held as additional collateral for the Mortgage Loan and released to the borrower in the event the debt yield equals or exceeds 9.5% during the first 24 months of the loan term. After 24 months, if the sums are not disbursed, the lender may hold the funds as additional collateral for the Mortgage Loan. The Cut-off Date LTV Ratio for such Mortgage Loan based on the Cut-off Date Balance of $6,300,000 and the “as-is” appraised value of $9,600,000 is 65.6%; and |
· | with respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as AmericInn - Eagle Colorado, representing approximately 0.5% of the Initial Pool Balance, unless otherwise indicated in this prospectus supplement, the Cut-off Date LTV Ratio is calculated based on the appraiser’s “as-is” value of $5,200,000, plus an amount equal to $91,384, which amount represents the amount reserved for certain PIP costs. The Cut-off Date LTV Ratio for such Mortgage Loan based solely on the “as-is” appraised value is 65.3%. |
“Debt Yield on Underwritten Net Cash Flow” or “Debt Yield on Underwritten NCF” means, with respect to any Mortgage Loan, the related Underwritten Net Cash Flow divided by the Cut-off Date Balance of that Mortgage Loan, except as set forth below:
· | with respect to any Split Mortgage Loan with a Pari Passu Companion Loan, the calculation of the Debt Yield on Underwritten Net Cash Flow is based on the aggregate principal balance of such Split Mortgage Loan and the related Pari Passu Companion Loan(s); and |
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· | with respect to the any Split Mortgage Loan with a Subordinate Companion Loan, the calculation of the Debt Yield on Underwritten Net Cash Flow does not include the principal balance of the related Subordinate Companion Loan. |
“Debt Yield on Underwritten Net Operating Income” or “Debt Yield on Underwritten NOI” means, with respect to any Mortgage Loan, the related Underwritten Net Operating Income divided by the Cut-off Date Balance of that Mortgage Loan, except as set forth below:
· | with respect any Split Mortgage Loan with a Pari Passu Companion Loan, the calculation of the Debt Yield on Underwritten Net Operating Income is based on the aggregate principal balance of such Split Mortgage Loan and the related Pari Passu Companion Loan(s); and |
· | with respect to the any Split Mortgage Loan with a Subordinate Companion Loan, the calculation of the Debt Yield on Underwritten Net Operating Income does not include the principal balance of the related Subordinate Companion Loan. |
“DSCR,” “Debt Service Coverage Ratio,” “Cut-off Date DSCR” or “Underwritten NCF DSCR” generally means, for any Mortgage Loan, the ratio of Underwritten Net Cash Flow produced by the related Mortgaged Property or Mortgaged Properties to the aggregate amount of the Annual Debt Service, except as set forth below:
· | with respect to any Split Mortgage Loan with a Pari Passu Companion Loan, the calculation of the DSCR is based on the Annual Debt Service that is due in connection with such Split Mortgage Loan and the related Pari Passu Companion Loan(s); |
· | with respect to the any Split Mortgage Loan with a Subordinate Companion Loan, the calculation of DSCR does not include the monthly debt service that is due in connection with the Subordinate Companion Loan, unless expressly stated otherwise; and |
· | with respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, representing approximately 4.1% of the Initial Pool Balance, the DSCR is calculated using such Mortgage Loan’s non-standard amortization schedule as set forth in Annex G in this prospectus supplement, and based on the aggregate debt service during the 12-month period commencing August 1, 2015. |
“Hard Lockbox” means that the borrower is required to direct the tenants to pay rents directly to a lockbox account controlled by the lender. Hospitality and multifamily properties are considered to have a hard lockbox if credit card receivables are required to be deposited directly into the lockbox account even though cash, checks or “over the counter” receipts are deposited by the manager of the related Mortgaged Property into the lockbox account controlled by the lender.
“In-Place Cash Management” means, for funds directed into a lockbox, such funds are generally not made immediately available to the related borrower, but instead are forwarded to a cash management account controlled by the lender and the funds are disbursed according to the related Mortgage Loan documents with any excess remitted to the related borrower (unless an event of default under the related Mortgage Loan documents or one or more specified trigger events have occurred and are outstanding) generally on a daily basis.
“Largest Tenant” means, with respect to any Mortgaged Property, the tenant occupying the largest amount of net rentable square feet.
“Largest Tenant Lease Expiration” means the date at which the applicable Largest Tenant’s lease is scheduled to expire.
“Loan Per Unit” means the principal balance per unit of measure as of the Cut-off Date.
“Maturity Date/ARD LTV Ratio”, “Maturity Date/ARD Loan-to-Value Ratio” or “LTV Ratio at Maturity/ARD” means, with respect to any Mortgage Loan, the ratio, expressed as a percentage of (1) the Balloon Balance of a Mortgage Loan as adjusted to give effect to the amortization of the applicable Mortgage Loan as of its maturity date or anticipated repayment date, as applicable, assuming no prepayments or defaults, divided by (2) the
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Appraised Value of the related Mortgaged Property or Mortgaged Properties shown on Annex A to this prospectus supplement, except as set forth below:
· | with respect to any Split Mortgage Loan with a Pari Passu Companion Loan, the calculation of the LTV Ratio at Maturity/ARD is based on the aggregate Balloon Balance at maturity of such Split Mortgage Loan and the related Pari Passu Companion Loan(s); |
· | with respect to any Split Mortgage Loan with a Subordinate Companion Loan, the calculation of the LTV Ratio at Maturity/ARD does not include the principal balance of the related Subordinate Companion Loan; and |
· | with respect to the Mortgage Loans secured by the Mortgaged Properties or portfolio of Mortgaged Properties identified in the table below, the respective LTV Ratio at Maturity/ARD was calculated using an “as stabilized”, “as stabilized/as completed” or “prospective market value upon stabilization” Appraised Value, as applicable, as opposed to the related “as-is” Appraised Value: |
Mortgaged Property Name | % of | Maturity | “As Stabilized” | Maturity LTV Ratio | “As-Is” | |||||||||
Selig Office Portfolio(1) | 9.95% | 62.3% | $553,400,000 | 63.4% | $544,500,000 | |||||||||
St. Anthony’s Healthplex North | 4.1% | 55.1% | $44,500,000 | 57.0% | $43,000,000 | |||||||||
Rockside Road Office Portfolio(2) | 4.1% | 59.0% | $43,627,500 | 60.6% | $42,472,500 | |||||||||
Park at Sugar Creek | 3.1% | 63.3% | $30,300,000 | 64.1% | $29,900,000 | |||||||||
Promenades Plaza | 2.0% | 54.3% | $23,000,000 | 56.0% | $22,300,000 | |||||||||
Crowne Plaza Bloomington | 1.7% | 55.1% | $38,700,000 | 66.9% | $31,900,000 | |||||||||
Magnolia Hotel Omaha | 1.5% | 50.2% | $18,500,000 | 56.0% | $16,600,000 | |||||||||
Shippensburg Shopping Center | 1.0% | 42.5% | $13,600,000 | 46.6% | $12,400,000 | |||||||||
Infinity Corporate Center | 0.9% | 48.5% | $10,500,000 | 60.0% | $8,500,000 | |||||||||
Northfield Office Complex | 0.7% | 39.3% | $10,860,000 | 52.8% | $8,100,000 | |||||||||
Chester County Multifamily Portfolio(3) | 0.7% | 56.1% | $7,175,000 | 59.4% | $6,775,000 | |||||||||
Highlands Plaza | 0.7% | 43.7% | $9,100,000 | 45.1% | $8,800,000 | |||||||||
210 West Huron | 0.5% | 59.5% | $5,400,000 | 65.6% | $4,900,000 | |||||||||
AmericInn - Eagle Colorado | 0.5% | 44.2% | $5,600,000 | 47.6% | $5,200,000 |
(1) | The Maturity Date/ARD LTV Ratio is calculated using the “as stabilized” Appraised Value for the Mortgaged Properties identified on Annex A to this prospectus supplement as 2901 Third Avenue, 3131 Elliott Avenue, 2615 Fourth Avenue and 200 First Avenue West. |
(2) | The Maturity Date/ARD LTV Ratio is calculated using the “as stabilized” Appraised Value for the Mortgaged Property identified on Annex A to this prospectus supplement as Southport Center. |
(3) | The Maturity Date/ARD LTV Ratio is calculated using the “as stabilized/as completed” Appraised Value for the Mortgaged Property identified on Annex A to this prospectus supplement as Granite Court. |
We cannot assure you that the value of any particular Mortgaged Property will not have declined from the Appraised Value shown on Annex A to this prospectus supplement. No representation is made that any Appraised Value presented in this prospectus supplement would approximate either the value that would be determined in a current appraisal of the Mortgaged Property or the amount that would be realized upon a sale of the Mortgaged Property.
“Most Recent NOI” and “Trailing 12 NOI” (which is for the period ending as of the date specified in Annex A to this prospectus supplement) is the net operating income for a Mortgaged Property as established by information provided by the borrowers, except that in certain cases such net operating income has been adjusted by removing certain non-recurring expenses and revenue or by certain other normalizations. Most Recent NOI and Trailing 12 NOI do not necessarily reflect accrual of certain costs such as taxes and capital expenditures and do not reflect non-cash items such a depreciation or amortization. In some cases, capital expenditures may have been treated by a borrower as an expense or expenses treated as capital expenditures. Most Recent NOI and Trailing 12 NOI were not necessarily determined in accordance with generally accepted accounting principles. Moreover, Most Recent NOI and Trailing 12 NOI are not a substitute for net income determined in accordance with generally accepted accounting principles as a measure of the results of a property’s operations or a substitute for cash flows from operating activities determined in accordance with generally accepted accounting principles as a measure of liquidity and in certain cases may reflect partial year annualizations.
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“Occupancy” means, unless the context clearly indicates otherwise, (i) in the case of multifamily, rental and mixed use (to the extent the related Mortgaged Property includes multifamily space) properties, the percentage of rental Units or Beds, as applicable, that are rented as of the Occupancy Date; (ii) in the case of office, retail, industrial, mixed use (to the extent the related Mortgaged Property includes retail or office space) and self storage properties, the percentage of the net rentable square footage rented as of the Occupancy Date (subject to, in the case of certain Mortgage Loans, one or more of the additional leasing assumptions); and (iii) in the case of hospitality properties, the percentage of available Rooms occupied for the trailing 12-month period ending on Occupancy Date. In some cases, occupancy was calculated based on assumptions regarding occupancy, such as the assumption that a certain tenant at the Mortgaged Property that has executed a lease, but has not yet taken occupancy and/or has not yet commenced paying rent, will take occupancy on a future date generally expected to occur within twelve months of the Cut-off Date; assumptions regarding the renewal of particular leases and/or the re-leasing of certain space at the related Mortgaged Property; in some cases, assumptions regarding leases under negotiation being executed; in some cases, assumptions regarding tenants taking additional space in the future if currently committed to do so or, in some cases, the exclusion of dark tenants, tenants with material aged receivables, tenants that may have already given notice to vacate their space, bankrupt tenants that have not yet affirmed their lease and certain additional leasing assumptions. See the footnotes to Annex A to this prospectus supplement for additional occupancy assumptions. We cannot assure you that the assumptions made with respect to any Mortgaged Property will, in fact, be consistent with that Mortgaged Property’s actual occupancy. See “—Tenant Issues” below.
“Occupancy Date” means the date of determination of the Occupancy of a Mortgaged Property.
“Original Balance” means the principal balance of the Mortgage Loan as of the date of origination.
“Prepayment Penalty Description” or “Prepayment Provision” means the number of payments from the first due date through and including the maturity date or anticipated repayment date, as applicable, for which a Mortgage Loan is, as applicable, (i) locked out from prepayment, (ii) provides for payment of a prepayment premium or yield maintenance charge in connection with a prepayment, (iii) permits defeasance and/or (iv) permits prepayment without a payment of a prepayment premium or a yield maintenance charge.
“Related Group” identifies each group of Mortgage Loans in the Mortgage Pool with sponsors affiliated with other sponsors in the Mortgage Pool. Each Related Group is identified by a separate number on Annex A to this prospectus supplement.
“RevPAR” means, with respect to any hospitality property, revenues per available room.
“Soft Lockbox” means that the related borrower is required to deposit or cause the property manager to deposit all rents collected into a lockbox account. Hospitality and multifamily properties are considered to have a soft lockbox if credit card receivables, cash, checks or “over the counter” receipts are deposited into the lockbox account by the borrower or property manager.
“Soft Springing Lockbox” means that the related borrower is required to deposit, or cause the property manager to deposit, all rents collected into a lockbox account until the occurrence of an event of default under the related Mortgage Loan documents or one or more specified trigger events, at which time the lockbox converts to a Hard Lockbox.
“Springing Cash Management” means, until the occurrence of an event of default under the Mortgage Loan documents or one or more specified trigger events, revenue from the lockbox account is forwarded to an account controlled by the related borrower or is otherwise made available to the related borrower. Upon the occurrence of an event of default or such a trigger event, the Mortgage Loan documents require the related revenue to be forwarded to a cash management account controlled by the lender and the funds are disbursed according to the related Mortgage Loan documents.
“Springing Lockbox” means a lockbox that is not currently in place, but the related Mortgage Loan documents require the imposition of a lockbox account upon the occurrence of an event of default under the related Mortgage Loan documents or one or more specified trigger events.
“Underwritten Expenses” with respect to any Mortgage Loan or Mortgaged Property, means an estimate of operating expenses, as determined by the related Originator and generally derived from historical expenses at the
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Mortgaged Property, the borrower’s budget or appraiser’s estimate, in some cases adjusted for significant occupancy increases and a market-rate management fee. We cannot assure you that the assumptions made with respect to any Mortgaged Property will, in fact, be consistent with that Mortgaged Property’s actual performance.
“Underwritten Net Cash Flow,” “Net Cash Flow” or “Underwritten NCF” with respect to any Mortgage Loan or Mortgaged Property, means cash flow available for debt service, generally equal to the Underwritten NOI decreased by an amount that the related Originator has determined for tenant improvement and leasing commissions and/or replacement reserves for capital items. Underwritten NCF does not reflect debt service or non-cash items such as depreciation or amortization.
The Underwritten Net Cash Flow for each Mortgaged Property is calculated based on the basis of numerous assumptions and subjective judgments (including, but not limited to, with respect to future occupancy and rental rates), which, if ultimately proved erroneous, could cause the actual net cash flow for the Mortgaged Property to differ materially from the Underwritten Net Cash Flow set forth in this prospectus supplement. In some cases, historical net cash flow for a particular Mortgaged Property, and/or the net cash flow assumed by the applicable appraiser in determining the Appraised Value of the Mortgaged Property, may be less (and, perhaps, materially less) than the Underwritten Net Cash Flow shown in this prospectus supplement for such Mortgaged Property. No representation is made as to the future cash flows of the Mortgaged Properties, nor is the Underwritten Net Cash Flows set forth in this prospectus supplement intended to represent such future cash flows. See “Risk Factors—Underwritten Net Cash Flow Could Be Based on Incorrect or Failed Assumptions” in this prospectus supplement.
“Underwritten Net Operating Income” or “Underwritten NOI” with respect to any Mortgage Loan or Mortgaged Property, means Underwritten Revenues less Underwritten Expenses, as both are determined by the related Originator, based in part upon borrower supplied information (including but not limited to a rent roll, leases, operating statements and budget) for a recent period which is generally the 12 months prior to the origination date or acquisition date of the Mortgage Loan (or Loan Combination, if applicable), adjusted for specific property, tenant and market considerations. Historical operating statements may not be available for newly constructed Mortgaged Properties, Mortgaged Properties with triple net leases, Mortgaged Properties that have recently undergone substantial renovations and/or newly acquired Mortgaged Properties.
The Underwritten NOI for each Mortgaged Property is calculated based on the basis of numerous assumptions and subjective judgments (including, but not limited to, with respect to future occupancy and rental rates), which, if ultimately proved erroneous, could cause the actual net operating income for the Mortgaged Property to differ materially from the Underwritten NOI set forth in this prospectus supplement. In some cases, historical net operating income for a particular Mortgaged Property, and/or the net operating income assumed by the applicable appraiser in determining the Appraised Value of the Mortgaged Property, may be less (and, perhaps, materially less) than the Underwritten NOI shown in this prospectus supplement for such Mortgaged Property. No representation is made as to the future cash flows of the Mortgaged Properties, nor is the Underwritten NOI set forth in this prospectus supplement intended to represent such future cash flows.
“Underwritten Revenues” or “Underwritten EGI” with respect to any Mortgage Loan or Mortgaged Property, means an estimate of operating revenues, as determined by the related Originator and generally derived from the rental revenue (which may include rental revenue related to reimbursement of tenant improvements and leasing commissions) based on leases in place, leases that have been executed but the tenant is not yet paying rent, month-to-month leases (based on current rent roll and annualized), leases that are being negotiated and expected to be signed, additional space that a tenant has committed to take and in certain cases contractual rent steps generally within 12 months following the Cut-off Date in certain cases certain appraiser estimates of rental income, and in some cases adjusted downward to market rates, with vacancy rates equal to the Mortgaged Property’s historical rate, current rate, market rate or an assumed vacancy as determined by the related Originator; plus any additional recurring revenue fees. Additionally, in determining rental revenue for multifamily rental, manufactured housing community and self storage properties, the related Originator either reviewed rental revenue shown on the certified rolling 12-month operating statements or annualized the rental revenue and reimbursement of expenses shown on rent rolls or recent partial year operating statements with respect to the prior 1- to 12-month periods or in some cases may have relied on information provided in the appraisal for market rental rates and vacancy. In certain cases, with respect to Mortgaged Properties with leases with rent increases or rent decreases during the term of the related Mortgage Loan, Underwritten Revenues were based on the average rent over the term of the Mortgage Loan. In some cases the related Originator included revenue
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otherwise payable by a tenant but for the existence of an initial “free rent” period or a permitted rent abatement while the leased space is built out. See “—Tenant Issues” below.
“Units,” “Rooms” or “Beds” means (a) in the case of a Mortgaged Property operated as multifamily, the number of apartments, regardless of the size of or number of rooms in such apartment, (b) in the case of a Mortgaged Property that is operated as a hospitality property, the number of guest rooms or (c) in the case of a Mortgaged Property operated as a student housing property, the number of beds.
“Weighted Average Mortgage Loan Rate” means the weighted average of the Mortgage Loan Rates as of the Cut-off Date.
Statistical Characteristics of the Mortgage Loans
Overview
General Mortgage Loan Characteristics
(As of the Cut-off Date, unless otherwise indicated)
All Mortgage Loans | ||
Initial Pool Balance(1) | $723,323,870 | |
Number of Mortgage Loans | 50 | |
Number of Mortgaged Properties | 76 | |
Average Cut-off Date Mortgage Loan Balance | $14,466,477 | |
Weighted Average Mortgage Loan Rate(2) | 4.0831% | |
Range of Mortgage Loan Rates(2) | 3.2950% – 4.8500% | |
Weighted Average Cut-off Date Loan-to-Value Ratio(2)(3) | 60.7% | |
Weighted Average Maturity Date/ARD Loan-to-Value Ratio(2)(4)(5) | 52.7% | |
Weighted Average Cut-off Date Remaining Term to Maturity Date/ARD (months)(5) | 118 | |
Weighted Average Cut-off Date DSCR(2)(6) | 2.29x | |
Full-Term Amortizing Balloon Mortgage Loans | 30.5% | |
Partial Interest-Only Balloon Mortgage Loans | 40.7% | |
Interest-Only Balloon Mortgage Loans(5) | 28.8% |
(1) | Subject to a permitted variance ofplus orminus 5%. |
(2) | With respect to any Split Mortgage Loan, any related Pari Passu Companion Loan(s) is/are included for the purposes of calculating the Cut-off Date Loan-to-Value Ratio, Maturity Date/ARD Loan-to-Value Ratio and Cut-off Date DSCR. With respect to any Split Mortgage Loan with a Subordinate Companion Loan, the Cut-off Date Loan-to-Value Ratio, Maturity Date/ARD Loan-to-Value Ratio and Cut-off Date DSCR with respect to such Split Mortgage Loan is calculated without regard to such Subordinate Companion Loan, unless otherwise indicated. Other than as specifically noted, the Cut-off Date Loan-to-Value Ratio, Maturity Date/ARD Loan-to-Value Ratio, Cut-off Date DSCR and Mortgage Loan Rate information for each Mortgage Loan is presented in this prospectus supplement without regard to any other indebtedness (whether or not secured by the related Mortgaged Property, ownership interests in the related borrower or otherwise) that currently exists or that may be incurred by the related borrower or its owners in the future. |
(3) | In most cases, the Cut-off Date Loan-to-Value Ratio for each Mortgage Loan is calculated utilizing the “as-is” appraised value. However, with respect to 3 Mortgage Loans, representing approximately 3.0% of the Initial Pool Balance, the respective Cut-off Date Loan-to-Value Ratio was calculated using either (i) an “as-is” appraised value plus related property improvement plan costs which were reserved for at origination, or (ii) the cut-off date principal balance of a mortgage loan less a reserve taken at origination. The weighted average Cut-off Date Loan-to-Value Ratio for the Mortgage Pool using only “as-is” appraised values and without making any of the adjustments described above is 61.2%. See the definitions of “Appraised Value” and “Cut-off Date Loan-to-Value Ratio” under “Description of the Mortgage Pool—Certain Calculations and Definitions” in this prospectus supplement. |
(4) | In the majority of cases, the Maturity Date/ARD Loan-to-Value Ratio for each Mortgage Loan is calculated utilizing the “as-is” appraised value. However, in the case of 14 Mortgage Loans, representing approximately 31.5% of the Initial Pool Balance, the Maturity Date/ARD Loan-to-Value Ratio is calculated using an “as stabilized”, “as stabilized/as completed” or a “prospective market value upon stabilization” appraised value instead of the related “as-is” appraised value, as further described under the definitions of “Appraised Value” and “Maturity Date/ARD Loan-to-Value Ratio” under “Description of the Mortgage Pool—Certain Calculations and Definitions” in this prospectus supplement. If the Maturity Date/ARD Loan-to-Value Ratios of those 14 mortgage loans were calculated using an “as-is” appraised value, then the weighted average Maturity Date/ARD Loan-to-Value Ratio for the mortgage pool would be 53.6%. |
(5) | Includes the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as 135 South LaSalle, representing approximately 13.8% of the Initial Pool Balance, which has an Anticipated Repayment Date and is assumed to mature and pay in full on its Anticipated Repayment Date. |
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(6) | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, representing approximately 4.1% of the Initial Pool Balance, which amortizes based on the non-standard amortization schedule set forth on Annex G to this prospectus supplement, the Cut-off Date DSCR of such mortgage loan is calculated based on the aggregate debt service during the 12-month period commencing August 1, 2015. |
See “Description of the Mortgage Pool—Certain Calculations and Definitions” in this prospectus supplement for important general and specific information regarding the manner of calculation of the underwritten debt service coverage ratios and loan-to-value ratios.
All of the Mortgage Loans (and Loan Combination(s)) are expected to have substantial remaining principal balances as of their respective maturity dates or anticipated repayment dates, as applicable. This includes 19 Mortgage Loans, representing approximately 30.5% of the Initial Pool Balance that pay principal and interest for their entire terms, 26 Mortgage Loans, representing approximately 40.7% of the Initial Pool Balance, that pay interest-only for a portion of their respective terms and 5 Mortgage Loans, representing approximately 28.8% of the Initial Pool Balance, that pay interest-only for their entire terms through their respective maturity dates or anticipated repayment dates, as applicable.
The Issuing Entity will include 12 Mortgage Loans, representing approximately 26.1% of the Initial Pool Balance, that represent the obligations of multiple borrowers that are liable on a joint and several basis for the repayment of the entire indebtedness evidenced by the related Mortgage Loan and/or represent separate obligations of each borrower that are cross-collateralized and cross-defaulted with each other.
Property Types
Office Properties
Eighteen (18) office properties, representing collateral for approximately 38.6% of the Initial Pool Balance by allocated loan amount, secure, in whole or in part, 9 of the Mortgage Loans. A large number of factors may adversely affect the operation and value of office properties. See “Risk Factors—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks—Office Properties” in the prospectus.
Certain of the office Mortgaged Properties may have specialty use tenants, such as dental or medical offices, physical therapy facilities (including aquatic physical therapy facilities), emergency room facilities, urgent care facilities, long-term care facilities, restaurants, fitness centers, schools/classrooms, concert halls, rooftop cell towers and/or parking garages, as part of the Mortgaged Property. Further, certain of the office Mortgaged Properties derive a portion of Underwritten Net Revenue from such specialty use tenants. These Mortgaged Properties and the related leased space may not be readily convertible (or convertible at all) to alternative uses if those properties were to become unprofitable, or the leased spaces were to become vacant, for any reason.
Mixed Use Properties
Six (6) mixed use properties, representing collateral for approximately 19.3% of the Initial Pool Balance by allocated loan amount, secure, in whole or in part, 5 of the Mortgage Loans.
Each of the mixed use properties has one or more retail, merchandise mart, office and/or flex components. To the extent a mixed use property has retail, merchandise mart, office and/or flex components, such Mortgaged Property is subject to the risks relating to the applicable property types described in “Risk Factors—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks—Retail Properties”, “—Office Properties” and “—Warehouse, Mini-Warehouse and Self-Storage Facilities”in the prospectus. A mixed use property may be subject to additional risks, including the property manager’s inexperience in managing the different property types that comprise such mixed use property.
Certain of the mixed use properties may have specialty use tenants, such as medical and dental offices, urgent care facilities, bio-medical facilities, theaters, parking garages, banks, ballroom event spaces, fitness centers, spas and/or restaurants. These Mortgaged Properties and the related leased space may not be readily convertible (or convertible at all) to alternative uses if those properties were to become unprofitable, or the leased spaces were to become vacant, for any reason. See “—Specialty Use Concentrations” below and “Risk Factors—Some Mortgaged Properties May Not Be Readily Convertible to Alternative Uses” in this prospectus supplement.
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Retail Properties
Sixteen (16) retail properties, representing collateral for approximately 16.7% of the Initial Pool Balance by allocated loan amount, secure, in whole or in part, 14 of the Mortgage Loans.
The presence or absence of an “anchor tenant” or a “shadow anchor tenant” in or near a retail property also can be important because anchors play a key role in generating customer traffic and making a center desirable for other tenants.
Seven (7) of the Mortgaged Properties, representing collateral for approximately 10.5% of the Initial Pool Balance by allocated loan amount, consist of a shopping center or other retail property that is considered by the applicable Sponsor to have at least one “anchor tenant.” Seven (7) of the Mortgaged Properties, representing collateral for approximately 4.5% of the Initial Pool Balance by allocated loan amount, are retail properties that are considered by the applicable Sponsor to be a “single tenant retail.” One (1) of the Mortgaged Properties, representing collateral for approximately 0.8% of the Initial Pool Balance by allocated loan amount, are retail properties that are considered by the applicable Sponsor to be “unanchored.” One (1) of the Mortgaged Properties, representing collateral for approximately 0.9% of the Initial Pool Balance by allocated loan amount, consist of a shopping center or other retail property that is considered by the applicable Sponsor to be “shadow anchored.”
Certain of the retail Mortgaged Properties may have specialty use tenants, such as theaters, medical and dental offices, emergency room facilities, diagnostic laboratories, fitness centers, health clubs, dry cleaners, classrooms/educational centers, health professional schools, gas stations, schools, daycare facilities, houses of worship, performance studios, night clubs, parking garages, hospitals, animal hospitals, driving schools, hair salons and/or restaurants. These Mortgaged Properties and the related leased space may not be readily convertible (or convertible at all) to alternative uses if those properties were to become unprofitable, or the leased spaces were to become vacant, for any reason. See “—Specialty Use Concentrations” below and “Risk Factors—Some Mortgaged Properties May Not Be Readily Convertible to Alternative Uses” in this prospectus supplement.
A large number of factors may adversely affect the operation and value of retail properties. See “Risk Factors—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks—Retail Properties” in the prospectus.
Multifamily Properties
Twelve (12) multifamily properties, representing collateral for approximately 12.5% of the Initial Pool Balance by allocated loan amount, secure, in whole or in part, 11 of the Mortgage Loans. A large number of factors may adversely affect the operation and value of multifamily properties. See “Risk Factors—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks—Multifamily Rental Properties” in the prospectus.
With respect to the Mortgage Loans secured by the Mortgaged Properties identified on Annex A to this prospectus supplement as Cottage Landing Apartments and Eagle’s Pointe Apartments representing approximately 1.2%, and 0.5% of the Initial Pool Balance, respectively, the related Mortgaged Properties are entirely (or nearly entirely) occupied by students.
With respect to the Mortgage Loans secured by the Mortgaged Properties identified on Annex A to this prospectus supplement as Avalon Apartments, Stonegate at Stillwater and Dorchester Village Apartments, representing approximately 1.1%, 0.9% and 0.5%, respectively, of the Initial Pool Balance, rely, in part, on subsidies under the Section 8 Tenant-Based Assistance Rental Certificate Program of the U.S. Department of Housing and Urban Development or a similar state-run program. We cannot assure you that such programs will be continued in their present form or that the level of assistance provided will be sufficient to generate enough revenues for the related borrowers to meet their obligations under the related Mortgage Loans.
With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Chester County Multifamily Portfolio, representing approximately 0.7% of the Initial Pool Balance, each of the related Mortgaged Properties is leased to tenants on a month-to-month basis.
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Self Storage Properties
Fifteen (15) self storage properties, representing collateral for approximately 7.7% of the Initial Pool Balance by allocated loan amount, secure, in whole or in part, 7 of the Mortgage Loans. A large number of factors may adversely affect the operation and value of self storage properties. See “Risk Factors—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks—Warehouse, Mini-Warehouse and Self Storage Facilities” in the prospectus.
Certain self storage Mortgaged Properties also derive a portion of the Underwritten Revenue from one or more of (a) rent derived from storage spaces used primarily for office and/or warehouse use located at the related Mortgaged Property, (b) rent derived from truck rentals located at the Mortgaged Property, (c) rent derived from on-site apartments leased out to third parties, (d) rent derived from cell tower and/or antenna leases, (e) rent derived from leasing billboard space to third parties, (f) the leasing of certain parking spaces located at the related Mortgaged Properties for purposes of recreational vehicle, other vehicle, and/or boat storage and/or (g) rent derived from retail operations.
Hospitality Properties
Three (3) hospitality properties, representing collateral for approximately 3.7% of the Initial Pool Balance by allocated loan amount, secure, in whole or in part, 3 of the Mortgage Loans. Two (2) of the hospitality Mortgaged Properties, representing collateral for approximately 2.2% of the Initial Pool Balance by allocated loan amount, are flagged hotel properties that are affiliated with a franchise or hotel management company through a franchise or management agreement.
A hospitality property subject to a franchise or management agreement is typically required by the hotel chain to satisfy certain criteria or risk termination of its affiliation. We cannot assure you that the franchise agreement or management agreement will remain in place or that the hotel will continue to be operated under a franchised brand or under its current name. In addition, transferability of a franchise agreement is generally restricted. In the event of a foreclosure, the lender or its agent may not have the right to use the franchise license without the franchisor’s consent. See “Risk Factors—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks—Hospitality Properties” in the prospectus.
The following table shows each Mortgaged Property associated with a hotel brand operated through a license, franchise agreement, operating agreement or management agreement with an expiration date that occurs, or a franchisor termination right that may be exercised, during the term of such Mortgage Loan. Securing a new franchise license may require significant capital investment for renovations and upgrades necessary to satisfy a franchisor’s requirements.
Mortgaged Property Name | Mortgage |
Percentage (%) of the | Expiration/Termination | Maturity Date | ||||
AmericInn - Eagle Colorado | $3,393,678 | 0.5% | 8/28/2022 | 6/6/2025 |
In addition, renovations, replacements and other work are ongoing at certain of the hospitality properties in connection with, among other things, franchise agreement and franchisor program requirements. See “—Redevelopment, Expansion and Renovation” below.
Certain of the hospitality properties may have a parking garage as part of the collateral. These Mortgaged Properties and the related leased space may not be readily convertible (or convertible at all) to alternative uses if those properties were to become unprofitable, or the leased spaces were to become vacant, for any reason. See “—Specialty Use Concentrations” below and “Risk Factors—Some Mortgaged Properties May Not Be Readily Convertible to Alternative Uses” in this prospectus supplement.
Hospitality properties may be particularly affected by seasonality.
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A large number of factors may adversely affect the operation and value of hospitality properties. See “Risk Factors—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks—Hospitality Properties” in the prospectus.
Industrial Properties
Six (6) industrial properties, representing collateral for approximately 1.5% of the Initial Pool Balance by allocated loan amount, secure, in whole or in part, 2 of the Mortgage Loans. A large number of factors may adversely affect the operation and value of industrial properties. See “Risk Factors—The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks—Industrial Properties” in the prospectus.
Certain industrial Mortgaged Properties may also derive a portion of the Underwritten Revenues from revenue from (a) rent derived from the leasing of office space at the Mortgaged Property and (b) rent derived from cell tower leases.
Specialty Use Concentrations
As indicated on Annex A to this prospectus supplement, certain of the Mortgaged Properties have a restaurant as one or more of the 5 largest tenants (based on net rentable square footage) or as a single tenant operating at the related Mortgaged Property. Restaurants are subject to certain unique risks including that the restaurant space is not easily convertible to other types of retail or office space and that the restaurant receipts are not only affected by objective factors but by subjective factors. For instance, restaurant receipts are affected by such varied influences as the current personal income levels in the community, an individual consumer’s preference for type of food, style of dining and restaurant atmosphere, the perceived popularity of the restaurant, food safety concerns related to personal health with the handling of food items at the restaurant or by food suppliers and the actions and/or behaviors of staff and management and level of service to the customers.
Certain of the Mortgaged Properties, including the Mortgaged Properties identified on Annex A to this prospectus supplement as Orinda Square, Park at Sugar Creek, Shippensburg Shopping Center and College Village Shopping Center, which secure approximately 8.1%, in the aggregate, of the Initial Pool Balance by allocated loan amount, have a gym, fitness center, spa, martial arts studio or a health club as part of the related Mortgaged Property.
Certain of the Mortgaged Properties, including the Mortgaged Properties identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, Park at Sugar Creek, Mesa Town Center, Promenades Plaza, Infinity Corporate Center, College Village Shopping Center, Highlands Plaza and Blue Bell Heights/Skyline Village, which secure approximately 15.2%, in the aggregate, of the Initial Pool Balance by allocated loan amount, have tenants operating medical, dental, physical therapy (including aquatic therapy), emergency rooms, urgent care or veterinary offices and/or facilities, research or diagnostic laboratories or health professional schools as part of the related Mortgaged Property.
Certain of the Mortgaged Properties, including the Mortgaged Properties identified on Annex A to this prospectus supplement as 135 South LaSalle, Mesa Town Center, Black Rock Commons and 210 West Huron, which secure approximately 18.3%, in the aggregate, of the Initial Pool Balance, has a bank or credit union branch as the sole tenant or one of the 5 largest tenants, which tenants are identified on Annex A. Bank branches are specialty-use properties that are outfitted with vaults, teller counters and other customary installations and equipment that require significant capital expenditures. The ability to lease these properties to entities other than financial institutions may be difficult due to the added cost and time of refitting the properties.
Certain of the Mortgaged Properties, including the Mortgaged Property identified on Annex A to this prospectus supplement as Orinda Square, securing approximately 3.1% of the Initial Pool Balance, have a theater as part of the related Mortgaged Property.
Certain of the Mortgaged Properties, including the Mortgaged Property identified on Annex A to this prospectus supplement as Hagerstown Plaza, securing approximately 2.0% of the Initial Pool Balance, have a gas station as part of the related Mortgaged Property.
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These Mortgaged Properties and the related leased space may not be readily convertible (or convertible at all) to alternative uses if those properties were to become unprofitable, or the leased spaces were to become vacant, for any reason. See “Risk Factors—Some Mortgaged Properties May Not Be Readily Convertible to Alternative Uses” in this prospectus supplement.
Mortgage Loan Concentrations
The table below presents the aggregate Cut-off Date Balance and percentage of Initial Pool Balance of the largest Mortgage Loans and the largest groups of Mortgage Loans with related borrowers:
Pool of Mortgage Loans
Aggregate | % of Initial | |||||
Top Mortgage Loan | $100,000,000 | 13.8% | ||||
Top 5 Mortgage Loans (considering any Crossed Group as a single Mortgage Loan) | $315,733,045 | 43.7% | ||||
Top 10 Mortgage Loans (considering any Crossed Group as a single Mortgage Loan) | $440,333,045 | 60.9% | ||||
Largest Related-Borrower Concentration(1) | $28,422,390 | 3.9% | ||||
Next Largest Related-Borrower Concentration(1) | $19,493,641 | 2.7% |
(1) | Excludes single-borrower Mortgage Loans and cross-collateralized and cross-defaulted Mortgage Loans that are not otherwise related to a borrower under any other Mortgage Loans. |
Other than with respect to the largest 10 Mortgage Loans (considering any Crossed Group as a single Mortgage Loan), each of the other Mortgage Loans represents no more than approximately 2.8% of the Initial Pool Balance. See“Structural and Collateral Term Sheet” in Annex B to this prospectus supplement for more information on the largest 20 Mortgage Loans (considering any Crossed Group as a single Mortgage Loan).
The following table shows each group of Mortgage Loans that have borrowers that are related to each other, with such groups collectively representing approximately 6.6% of the Initial Pool Balance. No group of Mortgage Loans having related borrowers represents more than approximately 3.9% of the Initial Pool Balance.
Related Borrower Loans
Mortgaged Property Name | Cut-off Date | % of Initial | |||
NY Seven Self Storage Portfolio | $20,547,390 | 2.8 | % | ||
Cape May Portfolio | 5,525,000 | 0.8 | |||
On-Site Self Storage | 2,350,000 | 0.3 | |||
Sub-Total | $28,422,390 | 3.9 | % | ||
Promenades Plaza | $14,600,000 | 2.0 | % | ||
Highlands Plaza | 4,893,641 | 0.7 | |||
Sub-Total | $19,493,641 | 2.7 | % | ||
Total | $47,916,031 | 6.6 | % |
Mortgage Loans with related borrowers are identified under “Related Group” on Annex A to this prospectus supplement.
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Geographic Concentrations
This table shows the states that have concentrations of Mortgaged Properties that secure 5.0% or more of the Initial Pool Balance:
Geographic Distribution(1)
State | Number of | Aggregate | % of Initial | |||||
Texas | 6 | $116,123,990 | 16.1% | |||||
California | 9 | $102,000,000 | 14.1% | |||||
Illinois | 1 | $100,000,000 | 13.8% | |||||
Washington | 9 | $72,000,000 | 9.95% | |||||
Oklahoma | 4 | $51,322,427 | 7.1% | |||||
Florida | 6 | $41,969,352 | 5.8% | |||||
Ohio | 6 | $38,124,015 | 5.3% |
(1) | Because this table presents information relating to Mortgaged Properties and not the Mortgage Loans, the information for the Mortgage Loans secured by more than one Mortgaged Property is based on allocated loan amounts as stated in Annex A to this prospectus supplement. |
Repayments by borrowers and the market value of the related Mortgaged Properties could be affected by economic conditions generally or specific to particular geographic areas or the regions of the United States, and concentrations of Mortgaged Properties in particular geographic areas may increase the risk that conditions in the real estate market where the Mortgaged Property is located, or other adverse economic or other developments or natural disasters (e.g., earthquakes, floods, forest fires, tornadoes or hurricanes or changes in governmental rules or fiscal policies) affecting a particular region of the country, could increase the frequency and severity of losses on Mortgage Loans secured by those Mortgaged Properties. For example:
· | Mortgaged Properties located in California, Washington, Oklahoma, Alaska, Nebraska, Oregon, Nevada and Colorado, among others, are more susceptible to certain hazards (such as earthquakes and wildfires) than properties in other parts of the country. |
· | Mortgaged Properties located in coastal states, which include Mortgaged Properties located in, for example, Texas, California, Illinois, Washington, Florida, Ohio, New Jersey, New York, Michigan, Maryland, Alaska, Pennsylvania, Minnesota, Oregon, Louisiana, Hawaii, Rhode Island, North Carolina, South Carolina and Connecticut, among others, also may be more generally susceptible to floods or hurricanes than properties in other parts of the country. Hurricanes in the Northeast and Mid-Atlantic States and in the Gulf Coast region have resulted in severe property damage as a result of the winds and the associated flooding. On October 29, 2012, Hurricane Sandy made landfall approximately five miles southwest of Atlantic City, New Jersey, causing extensive damage to coastal and inland areas in the eastern United States, including New York City, where certain of the Mortgaged Properties are located. The damage to the affected areas included, among other things, flooding, wind and water damage, forced evacuation, and fire damage. The cost of the hurricane’s impact, due to the physical damage it caused, as well as the related economic impact, is expected to be significant for some period of time, particularly in the areas most directly damaged by the storm. The Mortgage Loans do not require flood insurance on the related Mortgaged Properties unless they are in a flood zone and flood insurance is available. We cannot assure you that any hurricane damage would be covered by insurance. |
· | Mortgaged Properties located in the states that stretch from Texas to Canada, with its core centered in northern Texas, as well as in the southern United States and particularly the northern and central parts of Mississippi, are prone to tornados. |
· | Mortgaged Properties, securing approximately 16.1%, 5.8% and 1.2% of the Initial Pool Balance by allocated loan amount, are located in Texas, Florida and Louisiana, respectively, among other places, which may be adversely affected by events such as the oil platform explosion and subsequent oil spill that occurred in the Gulf of Mexico in April 2010. These events and similar events could lead to a regional economic downturn for the gulf coast region of the United States. |
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· | In addition, certain of the Mortgaged Properties are located in cities or states that are currently facing or may face a depressed real estate market, which is not due to any natural disaster but which may cause an overall decline in property values. |
Mortgaged Properties with Limited Prior Operating History
Four (4) of the Mortgaged Properties, identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, Walmart - Lawton, Walmart - Oklahoma City and Walgreens-Smithfield, securing approximately 6.9% of the Initial Pool Balance, were constructed, substantially renovated, re-positioned or repurposed 12 months or less prior to the Cut-off Date and, therefore, have no or limited prior operating history and/or lack historical financial figures and information.
Excluding any Mortgaged Properties referenced by the previous paragraph, one (1) of the Mortgaged Properties, identified on Annex A to this prospectus supplement as Crowne Plaza Bloomington, securing approximately 1.7% of the Initial Pool Balance, was acquired 12 months or less prior to the Cut-off Date and, therefore, lacks historical financial figures and information.
Tenancies-in-Common
Certain borrowers may own a Mortgaged Property as tenants-in-common. In the case of the Mortgage Loans secured by the Mortgaged Properties identified on Annex A to this prospectus supplement as Pasadena Office Tower, Orinda Square, Park at Sugar Creek, and Apple Creek Apartments, representing approximately 5.8%, 3.1%, 3.1% and 0.6%, respectively, of the Initial Pool Balance, each of the related borrowers are tenants-in-common. However, with respect to each such Mortgage Loan, the related tenants-in-common have waived their respective right to partition.
See “Risk Factors—The Borrower’s Form of Entity May Cause Special Risks” in this prospectus supplement and “Risk Factors—The Borrower’s Form of Entity May Cause Special Risks and/or Hinder Recovery” in the prospectus.
Condominium Interests
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Pasadena Office Tower, representing approximately 5.8% of the Initial Pool Balance, the related Mortgaged Property is comprised of an office building and an adjacent parking deck, and provided that no event of default is then continuing under the related Mortgage Loan, the related borrower may subject the parking deck portion of the Mortgaged Property to a new condominium governed by condominium documents reasonably reviewed and approved by the related lender. The parking deck would be subdivided and the condominium would be comprised of two units, the parking deck unit and the Airspace Parcel (as defined below). The portion of the Mortgaged Property comprising the office building would not be subject to the condominium.
Even if the borrower or its designated board members, either through control of the appointment and voting of sufficient members of the condominium board or by virtue of other provisions in the condominium documents, have consent rights over actions by the condominium associations or owners, we cannot assure you that the condominium board will not take actions that would materially adversely affect the borrower’s unit. See “Risk Factors—Lending on Condominium Units Creates Risks for Lenders That Are Not Present When Lending on Non-Condominiums” in the prospectus and “Risk Factors—Some Mortgaged Properties May Not Be Readily Convertible to Alternative Uses” in this prospectus supplement.
Leasehold Interests
For purposes of this prospectus supplement, an encumbered interest will be characterized as a “fee interest” and not a leasehold interest if (i) the borrower has a fee interest in all or substantially all of the Mortgaged Property (provided that if the borrower has a leasehold interest in any portion of the Mortgaged Property, and the fee interest in such portion is not also encumbered, then such portion is not, individually or in the aggregate, material to the use or operation of the Mortgaged Property), or (ii) the Mortgage Loan is secured by the borrower’s leasehold interest in the Mortgaged Property as well as the borrower’s (or other fee owner’s) overlapping fee interest in the related Mortgaged Property.
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Two (2) Mortgaged Properties, identified on Annex A to this prospectus supplement as Kohl’s Tallahassee FL and Cedar - Dover Plaza, securing approximately 0.6% and 0.3%, respectively, of the Initial Pool Balance by allocated loan amount, are each subject to a mortgage, deed of trust or similar security instrument that creates a first mortgage lien on (x) one or more leasehold interests in a material portion of the related Mortgaged Property and (y) one or more fee interests in the remaining portion of the related Mortgaged Property.
In general, unless the related fee interest is also encumbered by the related Mortgage, each of the ground leases has a term that extends at least 20 years beyond the maturity date of the Mortgage Loan (taking into account all freely exercisable extension options) and, except as noted on Annex E, contains customary mortgagee protection provisions, including notice and cure rights and the right to enter into a new lease with the applicable ground lessor in the event a ground lease is rejected or terminated.
See “Risk Factors—Lending on Ground Leases Creates Risks for Lenders That Are Not Present When Lending on an Actual Ownership Interest in a Real Property” in the prospectus. See also Sponsor Representations and Warranties No. 34 (Ground Leases) on Annex E-1 to this prospectus supplement and any related exceptions on Annex E-2 to this prospectus supplement (subject to the limitations and qualifications set forth in the preamble to Annex E-1 to this prospectus supplement).
Condemnations
There may be Mortgaged Properties securing Mortgage Loans as to which there have been or are currently condemnations, takings and/or grant of easements affecting portions of such Mortgaged Properties, or property adjacent to such Mortgaged Properties, which, in general, would not and do not materially affect the use, value or operation of such Mortgaged Property.
Additional Indebtedness
The Mortgage Loans generally prohibit borrowers from incurring any additional debt secured by their Mortgaged Property without the consent of the lender. However:
· | substantially all of the Mortgage Loans permit the related borrower to incur limited indebtedness in the ordinary course of business that is not secured by the related Mortgaged Property; |
· | the borrowers under certain of the Mortgage Loans have incurred and/or may incur in the future unsecured debt other than in the ordinary course of business; |
· | any borrower that is not required pursuant to the terms of its applicable Mortgage Loan documents to meet single-purpose entity criteria may not be restricted from incurring unsecured debt or mezzanine debt; |
· | the terms of certain Mortgage Loans permit the borrowers to post letters of credit and/or surety bonds for the benefit of the mortgagee under the Mortgage Loans, which may constitute a contingent reimbursement obligation of the related borrower or an affiliate. The issuing bank or surety will not typically agree to subordination and standstill protection benefiting the mortgagee; |
· | although the Mortgage Loans generally place certain restrictions on incurring mezzanine debt by the pledging of general partnership and managing member equity interests in a borrower, such as specific percentage or control limitations, the terms of the Mortgage Loan documents generally permit, subject to certain limitations, the pledge of the limited partnership or non-managing membership equity interests in a borrower or less than a controlling interest of any other equity interests in a borrower; and |
· | certain of the Mortgage Loans do not restrict the pledging of ownership interests in the borrower, but do restrict the transfer of ownership interests in a borrower by imposing limitations on transfer of control or a specific percentage of ownership interests. |
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Additional Secured Debt. The table below provides certain information with respect to each Split Mortgage Loan and its corresponding Companion Loan(s), that in each case are together secured by the same Mortgage on the related Mortgaged Property or portfolio of Mortgaged Properties.
Mortgaged Property | Mortgage Loan | % of Initial | Pari Passu | Subordinate | Loan | Loan | Loan | Loan | ||||||||
Selig Office Portfolio | $72,000,000 | 9.95% | $273,000,000(1) | N/A | $345,000,000 | 3.9085% | 63.4% | 2.22x | ||||||||
Dallas Market Center | $71,803,978 | 9.9% | $186,490,887(2) | N/A | $258,294,865 | 4.0975% | 64.1% | 2.13x | ||||||||
Crowne Plaza Bloomington | $12,170,872 | 1.7% | $13,909,568 | N/A | $26,080,440 | 4.6500% | 73.3% | 1.72x | ||||||||
(1) | The Selig Office Portfolio Companion Loans are currently comprised of the controlling note A-1, with an outstanding principal balance as of the Cut-off Date of $125,000,000, the non-controlling note A-2, with an outstanding principal balance as of the Cut-off Date of $123,000,000, and the non-controlling note A-4, with an outstanding principal balance as of the Cut-off Date of $25,000,000. See below for information regarding permittedpari passu debt. |
(2) | The Dallas Market Center Companion Loans are currently comprised of the controlling note A-1, with an outstanding principal balance as of the Cut-off Date of $129,646,071, and the non-controlling note A-3, with an outstanding principal balance as of the Cut-off Date of $56,844,816. |
See “—The Loan Combinations” below for more information regarding these Companion Loans. Also see “Structural and Collateral Term Sheet—Selig Office Portfolio”,“—Dallas Market Center”and “—Crowne Plaza Bloomington” in Annex B to this prospectus supplement.
Permitted Additional Secured Debt. With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Selig Office Portfolio, representing approximately 9.95% of the Initial Pool Balance, upon 30 days’ prior written notice to the lender, the borrower may elect (an “Additional Permitted Debt Election”), to incur up to $51,750,000 of additionalpari passu fixed-rate debt that is co-terminus with the related Mortgage Loan (“Additional Permitted Debt”) secured by the Mortgaged Properties, provided that each of the following requirements is satisfied: (i) immediately after giving effect to such Additional Permitted Debt, if the borrower requests the lender’s approval of an Additional Permitted Debt Election on or prior to March 19, 2020, the aggregate loan-to-value ratio (as calculated under the Mortgage Loan documents) may not exceed 60%, and if the borrower requests the lender’s approval of an Additional Permitted Debt Election after March 19, 2020, the aggregate loan-to-value ratio may not exceed 58% (in each case, taking into account the principal amount of such Additional Permitted Debt); (ii) immediately after giving effect to such Additional Permitted Debt, the debt service coverage ratio (as calculated under the Mortgage Loan documents) for the 12-month period immediately preceding the most recently ended fiscal quarter must be equal to or greater than 2.44x (in each case, taking into account debt service for such Additional Permitted Debt); (iii) immediately after giving effect to such Additional Permitted Debt, if the borrower requests the lender’s approval of an Additional Permitted Debt Election on or prior to March 19, 2020, the debt yield (as calculated under the Mortgage Loan documents) for the 12-month period immediately preceding the most recently ended fiscal quarter must be no less than 9.25%, and if such request is made after March 19, 2020, the debt yield for the 12-month period immediately preceding such fiscal quarter end must be no less than 9.5% (in each case, taking into account the principal amount of such Additional Permitted Debt); (iv) the lender of the Additional Permitted Debt is required to enter into a co-lender agreement with the lender in the form attached to the loan agreement; (v) rating agency confirmation (subject to the requirements of the related Outside Servicing Agreement) is obtained; (vi) a REMIC opinion, as well as updated non-consolidation and enforceability opinions must be delivered; (vii) the borrower, the lender and the lender of the Additional Permitted Debt have executed amendments to the loan documents reasonably requested by any such party to reflect the existence of such Additional Permitted Debt; (viii) the borrower must pay all reasonable out of pocket costs and expenses incurred by the lender; and (ix) the lender has otherwise approved, in its sole discretion applied in good faith and using commercially reasonable standards, the terms, documentation, lender, and incurrence of the Additional Permitted Debt. Pursuant to the form of co-lender agreement attached as an exhibit to the loan agreement, the borrower and the lender contemplate that such permittedpari passu debt will be secured by the related Mortgaged Properties pursuant to the existing mortgage granted by the borrower in connection with the origination of the Mortgage Loan, and that such permittedpari passu debt will be serviced by the related Outside Servicer and the related Outside Special Servicer pursuant to
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the terms of the related Outside Servicing Agreement. In addition, the lender of such Additional Permitted Debt will have the right to consult with the related Outside Special Servicer with respect to the following proposed actions by the related Outside Special Servicer (provided that in no event will the related Outside Special Servicer be obligated to act upon the direction, advice or objection of such lender or its representative in connection therewith): (i) any proposed or actual foreclosure upon or comparable conversion (which may include acquisition of any related REO Property) of the ownership of any Mortgaged Property securing the Selig Office Portfolio Loan Combination and the Additional Permitted Debt if it comes into and continues in default; (ii) any modification, amendment or waiver of a monetary term (including a change in the timing of payments but excluding the waiver of late payment or default charges) or any material non-monetary term (including the waiver of any “due-on-sale” or “due-on-encumbrance” clause) of the Selig Office Portfolio Loan Combination; (iii) any proposed sale of any related REO Property (other than in connection with the termination of the issuing entity created pursuant to the CGCMT 2015-GC29 Pooling and Servicing Agreement) for less than the mortgage option price; (iv) any acceptance of a discounted payoff with respect to the Selig Office Portfolio Loan Combination and the Additional Permitted Debt; (v) any determination to bring any related REO Property into compliance with applicable environmental laws or to otherwise address hazardous materials located at such REO Property; (vi) any release of real property collateral for the Selig Office Portfolio Loan Combination and the Additional Permitted Debt (other than any release made in connection with the grant of a non-material easement or right-of-way or in accordance with the terms of the Selig Office Portfolio Loan Combination and the Additional Permitted Debt); (vii) any acceptance of substitute or additional collateral for the Selig Office Portfolio Loan Combination and the Additional Permitted Debt; (viii) any releases of earn-out reserve funds or related letters of credit with respect to any related Mortgaged Property; (ix) any determination by the related Outside Servicer or the related Outside Special Servicer not to maintain or cause the borrower to maintain for any related Mortgaged Property or REO Property all-risk casualty or other insurance that provides coverage for acts of terrorism, despite the fact that such insurance may be required under the terms of the Mortgage Loan; and (x) any change in the property manager for any related Mortgaged Property or REO Property.
Existing Mezzanine Debt. Mezzanine debt is debt that is incurred by the direct or indirect owner of equity in one or more borrowers and is secured by a pledge of the equity ownership interests in such borrowers. Because mezzanine debt is secured by the obligor’s direct or indirect equity interest in the related borrowers, such financing effectively reduces the obligor’s economic stake in the related Mortgaged Property. The existence of mezzanine debt may reduce cash flow on the borrower’s Mortgaged Property after the payment of debt service and may increase the likelihood that the owner of a borrower will permit the value or income producing potential of a Mortgaged Property to fall and may create a slightly greater risk that a borrower will default on the Mortgage Loan secured by a Mortgaged Property whose value or income is relatively weak.
As of the Cut-off Date, except as disclosed in the following table, each Sponsor has informed us that it is unaware of any existing mezzanine or subordinate indebtedness with respect to the Mortgage Loans it is selling to the Depositor:
Mortgaged Property | Mortgage Loan | Subordinate | Cut-off Date | Total Debt | Cut-off Date | Cut-off | Cut-off Date |
Cut-off | ||||||||
St. Anthony’s Healthplex North(1)(2) | $29,929,067 | $4,988,178 | $34,917,245 | 4.8000% | 69.6% | 81.2% | 1.64x | 1.21x |
(1) | The related mezzanine loan is initially being held by RAIT Partnership, L.P., an affiliate of RAIT, and is secured by the mezzanine borrower’s interests in the related Mortgage Loan borrower. |
(2) | The related Cut-off Date Mortgage Loan DSCR and Cut-off Date Total Debt DSCR are calculated (a) using (i) the Mortgage Loan’s non-standard amortization schedule, which is set forth on Annex G to this prospectus supplement, and (ii) the mezzanine loan’s non-standard amortization schedule, and (b) based on the aggregate debt service payable under the Mortgage Loan and/or the mezzanine loan, as applicable, during the 12-month period commencing August 1, 2015. |
The mezzanine loan related to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, representing approximately 4.1% of the Initial Pool Balance, is subject to an intercreditor agreement between the holder of the mezzanine loan and the lender under the Mortgage Loan that sets forth the relative priorities between the Mortgage Loan and the mezzanine loan. Such intercreditor agreement or the mezzanine loan agreement generally provides, among other things,
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that (a) all payments due under the mezzanine loan are subordinate after an event of default under the Mortgage Loan to any and all payments required to be made under the Mortgage Loan (except for any payments from funds other than the Mortgaged Property or proceeds of any enforcement upon the mezzanine loan collateral and any mezzanine loan guarantees), (b) following an event of default under the Mortgage Loan, the mezzanine lender may accept payments and prepayments of the mezzanine loan only from non-property-related revenue, (c) the mezzanine lender will have certain rights to receive notice of and cure defaults under the Mortgage Loan prior to any acceleration or enforcement of the Mortgage Loan, (d) the mezzanine lender may amend or modify the mezzanine loan in certain respects without the consent of the mortgage lender, and the mortgage lender must obtain the mezzanine lender’s consent to amend or modify the Mortgage Loan in certain respects, (e) upon the occurrence of an event of default under the mezzanine loan documents, the mezzanine lender may foreclose upon the membership interests in the Mortgage Loan borrower, which could result in a change of control with respect to the Mortgage Loan borrower and a change in the management of the Mortgaged Property, (f) if the Mortgage Loan is accelerated or becomes specially serviced or if a monetary or material non-monetary default occurs and continues for a specified period of time under the Mortgage Loan or if the Mortgage Loan borrower becomes a debtor in a bankruptcy or if the mortgage lender exercises any enforcement action under the Mortgage Loan documents with respect to the Mortgage Loan borrower or the Mortgaged Property, the mezzanine lender has the right to purchase the Mortgage Loan, in whole but not in part, for a price generally equal to the outstanding principal balance of the Mortgage Loan, together with all accrued interest and other amounts due thereon, plus any advances made by the related mortgage lender or its servicer and any interest thereon plus, subject to certain limitations, any Liquidation Fees and Special Servicing Fee payable under the Pooling and Servicing Agreement, but generally excluding any late charges, default interest, exit fees, spread maintenance charges payable in connection with a prepayment or yield maintenance charges and prepayment premiums, and (g) an event of default under the Mortgage Loan will trigger an event of default under the mezzanine loan.
Generally, upon a default under a mezzanine loan described in the preceding paragraph, the holder of the mezzanine loan would be entitled to foreclose upon the equity in the related borrower, which has been pledged to secure payment of such debt. Although this transfer of equity may not trigger the due-on-sale clause under the related Mortgage Loan, it could cause a change in control of the borrower or a change in the management of the Mortgaged Property and/or cause the obligor under the mezzanine loan to file for bankruptcy, which could negatively affect the operation of the related Mortgaged Property and the related borrower’s ability to make payments on the related Mortgage Loan in a timely manner.
Permitted Mezzanine Debt. The Mortgage Loans generally place certain restrictions on the transfer and/or pledging of general partnership and managing member equity interests in a borrower such as specific percentage or control limitations as described under “—Certain Terms of the Mortgage Loans—‘Due-On-Sale’ and ‘Due-On-Encumbrance’ Provisions” below.
In addition, certain of the Mortgage Loans do not prohibit the pledge by direct or indirect owners of the related borrower of equity distributions that may be made from time to time by the borrower to its equity owners.
With respect to the Mortgage Loans listed in the following chart, the direct and indirect equity owners of the borrower are permitted to incur future mezzanine debt, subject to the satisfaction of conditions contained in the related Mortgage Loan documents, including, among other things, a combined maximum loan-to-value ratio, a combined minimum debt service coverage ratio and/or a combined minimum debt yield, as listed in the following chart:
Mortgaged Property Name | Mortgage Loan | Combined | Combined | Combined | Intercreditor | |||||
Selig Office Portfolio | $72,000,000 | (1) | 2.44x | 9.5% | Y | |||||
Magnolia Hotel Omaha | $11,200,000 | 75.0% | 1.30x | 10.0% | Y | |||||
Gables CitiTower | $8,986,917 | 75.0% | N/A | N/A | Y |
(1) | If borrower requests lender’s approval of an Additional Permitted Debt Election on or prior to March 19, 2020, the aggregate loan to value ratio is required to be equal to or less than 60%. If borrower requests lender’s approval of an Additional Permitted Debt Election any time after March 19, 2020, the aggregate loan to value ratio is required to be equal to or less than 58%. |
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Each of the Mortgage Loans listed above conditions the incurrence of future mezzanine debt on the execution of an intercreditor agreement between the holder of the related mezzanine loan and the related lender under the related Mortgage Loan that, in each case, sets forth the relative priorities between the related Mortgage Loan and the related mezzanine loan.
Preferred Equity and Preferred Return. Further, borrowers under certain of the Mortgage Loans are permitted to issue preferred equity in such borrowers or in certain parent entities of such borrowers. Because preferred equity often provides for a higher rate of return to be paid to certain holders, preferred equity in some respects functions like mezzanine indebtedness, and reduces a principal’s economic stake in the related Mortgaged Property, reduces cash flow on the borrower’s Mortgaged Property after the payment of debt service and payments on the preferred equity and may increase the likelihood that the owner of a borrower will permit the value or income-producing potential of a Mortgaged Property to fall and may create a slightly greater risk that a borrower will default on the Mortgage Loan secured by a Mortgaged Property whose value or income is relatively weak.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Cottage Landing Apartments, representing approximately 1.2% of the Initial Pool Balance, Cayenne Realty, LLC, the 50% owner of the borrower, is entitled to a preferred distribution ahead of other equity holders, with a 4% annual preferred return on its $1,400,847 capital contribution. There is no maturity date on the return of this entity’s capital contribution and the entity is not otherwise entitled to any other rights, remedies or required payments and cannot take control of the borrower for non-payment of its return. The preferred return is payable from excess cash flow.
Permitted Unsecured Debt. With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Dallas Market Center, representing approximately 9.9% of the Initial Pool Balance, the related borrower is permitted under the related loan agreement to accept unsecured loans made by the borrower’s partners to the borrower in accordance with the terms of the borrower’s organizational documents and not exceeding $15,000,000 in the aggregate, provided that each loan is required to be subject to the terms of a subordination and standstill agreement in a form acceptable to the lender and to be entered into by the applicable holder in favor of the lender.
There may be other Mortgage Loans that permit the related borrower to incur unsecured loans or indebtedness, including unsecured loans in the ordinary course of business without limitation on the amount of such indebtedness.
Certain risks relating to additional debt are described in “Risk Factors—Other Financings or Ability to Incur Other Financings Entails Risk” in this prospectus supplement.
Environmental Considerations
An environmental report was prepared for each Mortgaged Property securing a Mortgage Loan no more than 9 months prior to the Cut-off Date. See Annex A to this prospectus supplement for the date of the environmental report for each Mortgaged Property. The environmental reports were generally prepared pursuant to the American Society for Testing and Materials standard for a “Phase I” environmental site assessment (each, an “ESA”). In addition to the Phase I standards, some of the environmental reports will include additional research, such as limited sampling for asbestos containing material, lead based paint, radon or water damage with limited areas of potential or identified mold, depending upon the property use and/or age. Additionally, as needed pursuant to American Society for Testing and Materials standards, supplemental “Phase II” site investigations have been completed for some Mortgaged Properties to further evaluate certain environmental issues, including certain recognized environmental conditions (each, a “REC”). A Phase II investigation generally consists of sampling and/or testing.
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The environmental reports may have revealed material adverse conditions or circumstances at a Mortgaged Property:
· | that were remediated or abated before the origination date of the related Mortgage Loan or are anticipated to be remediated or abated before the Closing Date; |
· | for which an operations and maintenance plan, abatement as part of routine maintenance or periodic monitoring of the Mortgaged Property or nearby properties will be in place or recommended; |
· | for which an escrow, guaranty or letter of credit for the remediation will have been established pursuant to the terms of the related Mortgage Loan; |
· | for which an environmental insurance policy will have been obtained from a third party insurer; |
· | for which the principal of the borrower or another financially responsible party will have provided an indemnity or will have been required to take, or will be liable for the failure to take, such actions, if any, with respect to such matters as will have been required by the applicable governmental authority or recommended by the environmental reports; |
· | for which such conditions or circumstances will have been investigated further and the environmental consultant has recommended no further action or remediation; |
· | as to which the borrower or other responsible party has obtained, or will be required to obtain post closing, a “no further action” letter or other evidence that governmental authorities would not be requiring further action or remediation; |
· | that would not require substantial cleanup, remedial action or other extraordinary response under environmental laws; or |
· | for which the related borrower has obtained or sought to obtain or agreed to seek a “case closed” or similar status for the issue from the applicable governmental agency. |
It was not uncommon for the environmental testing to reveal the presence of asbestos containing materials, lead based paint, mold and/or radon at any Mortgaged Property. Where these substances were present, the environmental consultant generally recommended, and the borrower was generally required to establish an operation and maintenance plan to address the issue or, in some cases involving asbestos containing materials and lead based paint, an abatement or removal program.
Other identified conditions could, for example, include leaks from surface level storage tanks, underground storage tanks (each, a “UST”), leaking underground storage tanks (each, a “LUST”), onsite dry cleaning facilities, gas stations, and on site spills. In such cases, corrective action, as required by the regulatory agencies, has been or is currently being undertaken and, in some cases, the related borrowers have made deposits into environmental reserve accounts. However, we cannot assure you that any environmental indemnity, insurance, letter of credit, guaranty or reserve amounts will be sufficient to remediate the environmental conditions or that all environmental conditions have been identified or that operation and maintenance plans will be put in place and/or followed.
Problems associated with mold may pose risks to the real property and may also be the basis for personal injury claims against a borrower. Although the Mortgaged Properties will be required to be inspected periodically, there is no set of generally accepted standards for the assessment of mold currently in place. If left unchecked, the growth of mold could result in the interruption of cash flow, litigation and remediation expenses which could adversely impact collections from a Mortgaged Property.
It is possible that the environmental reports and/or Phase II sampling did not reveal all environmental liabilities, or that there are material environmental liabilities of which we are not aware. Also, the environmental condition of the Mortgaged Properties in the future could be affected by the activities of tenants and occupants or by third parties unrelated to the borrowers. For further general discussion of the environmental matters that may affect the Mortgaged Properties, see “Risk Factors—Environmental Liabilities Will Adversely Affect the Value and
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Operation of the Contaminated Property and May Deter a Lender from Foreclosing” and “Certain Legal Aspects of the Mortgage Loans—Environmental Considerations” in the prospectus.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Chalet Garden Apartments, representing approximately 3.8% of the Initial Pool Balance, the related Phase I ESA identified the prior use of the Mortgaged Property as a landfill. The landfill was closed in 1970 in accordance with New Jersey Department of Environmental Protection procedures. Active methane monitoring systems have been installed on the ground floor of each of the 26 affected buildings at the Mortgaged Property. The borrower established an upfront rolling reserve for methane mitigation systems at loan origination. In addition, the borrower obtained an environmental impairment liability policy with Lloyd’s of London, with policy limits of $3 million per incident and in the aggregate, a $50,000 deductible and a coverage period that extends beyond the maturity date of the Mortgage Loan. The policy premium was paid in full.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Park at Sugar Creek, representing approximately 3.1% of the Initial Pool Balance, the related Phase I ESA report identified an active dry cleaner facility as a recognized environmental condition, based on the continued use of chlorinated solvents since the time of the most recent subsurface investigation in 1996. The Phase I ESA recommended further investigation of the dry cleaner space, at an estimated cost of $10,000 to $12,000. The related loan agreement requires the borrower to complete a Phase II ESA within 90 days of the origination of the Mortgage Loan.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A of this prospectus supplement as Magnolia Hotel Omaha, representing approximately 1.5% of the Initial Pool Balance, the related Phase I ESA identifies the Mortgaged Property as part of a larger National Priorities List (“NPL”) site commonly known as the “Omaha Lead site”. The Omaha Lead site includes surface soils present at residential properties, child care facilities, schools, and other similar-type properties in the City of Omaha that have been contaminated as a result of lead refining and lead battery recycling from the 1870s until 1996 at facilities located in the downtown Omaha area. The concern at these sites has been lead contamination through direct exposure from contaminated soils. According to the Phase I ESA, soils on the Mortgaged Property were modified during construction of the current improvements, and the Mortgaged Property is currently fully developed with no exposed soils. Consequently, the Phase I ESA consultant determined the NPL listing for the Mortgaged Property to be ademinimis condition. Additionally, responsible parties associated with the larger Omaha Lead NPL site do not include any current owners or operators of the Mortgaged Property.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Highlands Plaza, representing approximately 0.7% of the Initial Pool Balance, the Phase I ESA indicated that a former dry cleaner operated at the Mortgaged Property between 1995 and 2005. The dry cleaner is enrolled in the Florida Department of Environmental Protection’s (“FDEP”) Dry Cleaning Solvent Program and is in good standing. Based on the dry cleaner’s low scoring, no further investigations have been recommended by FDEP. The borrower obtained an environmental impairment liability policy with Lloyd’s of London, with policy limits of $3 million per incident and in the aggregate, a $50,000 deductible and a coverage period that extends beyond the maturity date of the Mortgage Loan. The policy premium was paid in full.
With respect to the Mortgaged Property identified on Annex A to this prospectus supplement as 2615 Fourth Avenue, securing approximately 0.7% of the Initial Pool Balance by allocated loan amount, the related Phase I ESA reported that a gas station operated onsite prior to redevelopment for a high rise office building with underground garage, and the gas station’s underground storage tanks were removed. Previous subsurface investigation identified residual contamination entombed beneath the garage floor slab; however, the ESA concluded that vapor intrusion is not a significant concern. The Mortgaged Property is classified as an active clean-up site and the responsible party is Martin Selig Property. The ESA recommended that investigation and remediation be continued and that documentation of such be reviewed.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A of this prospectus supplement as Walgreens Winston-Salem, representing approximately 0.6% of the Initial Pool Balance, the related Phase I ESA identifies as a REC two LUSTs that were removed from the Mortgaged Property in 2000. These two former heating oil tanks were associated with historic operations at the Mortgaged Property by the North Carolina Department of Transportation (NCDOT). Pursuantto the Phase I ESA, the State of North Carolina has been identified as the party responsible for addressing the LUSTs. Through an Agreement for Environmental Remediation, Reimbursement and Site Assess (dated March 19, 2004), the State of North
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Carolina has agreed to obtain a No Further Action (NFA) letter for the LUSTs and to perform and pay for any remediation required by the North Carolina Department of Environment and Natural Resources.
Litigation Considerations
Below are descriptions of certain material current litigation matters relating to certain Mortgage Loans. Certain risks relating to litigation regarding the Mortgaged Properties or the borrowers are described in “Risk Factors—Litigation Regarding the Mortgaged Properties or Borrowers May Impair Your Distributions” in this prospectus supplement.
With respect to the Mortgage Loan secured in part by the Mortgaged Property identified on Annex A to this prospectus supplement as Butterfield Shopping Center, representing approximately 1.4% of the Initial Pool Balance, the related sponsor is currently a defendant in a deficiency lawsuit after a foreclosure on an investment residential property. The lender is claiming a deficiency of $708,461 plus accrued interest since the foreclosure date, and the sponsor is defending the lawsuit on the grounds that the appraised value exceeds the amount of the total debt owed at the time of the foreclosure.
We cannot assure you that these above-described litigations would not have an adverse effect on, or provide any indication of the future performance of the obligors or the non-recourse carveout guarantors under, the related Mortgage Loans.
Redevelopment, Expansion and Renovation
Certain of the Mortgaged Properties are properties which are currently undergoing or, in the future, are expected to undergo redevelopment, renovation or expansion, including with respect to hospitality properties, property improvement plans (“PIPs”) required by the franchisors. Below are descriptions of certain of such Mortgaged Properties. Certain risks related to redevelopment, expansion and renovation at a Mortgaged Property are described in “Risk Factors—Risks Related to Redevelopment, Expansion and Renovation at Mortgaged Properties” in this prospectus supplement.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Pasadena Office Tower, representing approximately 5.8% of the Initial Pool Balance,after such time as the related borrower has subdivided the parking area of the Mortgaged Property and created a condominium in accordance with the related Mortgage Loan documents, the related borrower has a one-time right to obtain the release of the airspace parcel of the parking area of the condominium (the “Airspace Parcel”) from the lien of the Mortgage Loan, upon the satisfaction of certain conditions described under “—Certain Terms of the Mortgage Loans—Partial Releases—Property Releases; Free Releases” in this prospectus supplement. The purchaser of the Airspace Parcel after its release from the Mortgage Loan in accordance with the provisions of the Mortgage Loan documents may construct multifamily dwelling units in the Airspace Parcel situated above a portion of the Mortgaged Property in a size and scope reasonably acceptable to the related lender and in compliance with certain provisions of the Mortgage Loan documents. We cannot assure you that any construction of the Airspace Parcel will not impair the use or value of the Mortgaged Property.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplementas Crowne Plaza Bloomington, representing approximately 1.7% of the Initial Pool Balance, a $3,689,846 PIP commenced upon origination of the Mortgage Loan, when the related borrower acquired the related Mortgaged Property. $4,612,308 was funded into a PIP reserve at origination, representing approximately 125% of the projected cost of the PIP.
With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Chester County Multifamily Portfolio, representing approximately 0.7% of the Initial Pool Balance, the related borrowers intend to implement a capital improvement plan at the related Mortgaged Properties. At origination of the Mortgage Loan, the related borrowers were required to reserve $460,000, which represents the full estimated cost of the capital improvement plan and certain other deferred maintenance, with the related lender.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as AmericInn - Eagle Colorado, representing approximately 0.5% of the Initial Pool
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Balance, a PIP is ongoing. $123,023 was reserved at origination, representing 110% of the projected cost of the completion of the PIP.
We cannot assure you that these above described renovations and build outs will not temporarily interfere with the use and operation of portions of the related Mortgaged Property and/or make the related Mortgaged Property less attractive to potential guests, patrons, customers and/or tenants. See“Structural and Collateral Term Sheet” in Annex B to this prospectus supplement for additional information on the 10 largest Mortgage Loans (considering any Crossed Group as a single Mortgage Loan).
Default History, Bankruptcy Issues and Other Proceedings
Four (4) of the Mortgage Loans, representing approximately 12.0% of the Initial Pool Balance, by allocated loan amount, were refinancings in whole or in part of loans that were (or refinancings of temporary bridge loans that in turn refinanced loans that were) in default at the time of refinancing or otherwise involved discounted pay-offs or provided acquisition financing for the related borrower’s purchase of the related Mortgaged Property at a foreclosure sale or after becoming REO, as described below:
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Dallas Market Center, representing approximately 9.9% of the Initial Pool Balance, the proceeds of the Mortgage Loan were used to pay off a bridge mortgage loan secured by the buildings included at the Mortgaged Property identified as Trade Mart and World Trade Center, which bridge loan was used to refinance a prior loan that went into maturity default in 2014 and had been moved to special servicing. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Infinity Corporate Center, representing approximately 0.9% of the Initial Pool Balance, the borrower acquired the Mortgaged Property as part of a distressed REO sale in October 2014. In 2012, the prior owner of the Mortgaged Property defaulted on its loan, which was securitized in a separate transaction, after the loss of a major tenant and the reduction in space of another tenant. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Northfield Office Complex, representing approximately 0.7% of the Initial Pool Balance, the proceeds of the Mortgage Loan were used to fund, in part, a discounted payoff of a mortgage loan originated in 2005 in the initial principal amount of $24,300,000. The discounted payoff amount was $7,300,000. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Dorchester Village Apartments, representing approximately 0.5% of the Initial Pool Balance, the proceeds of the Mortgage Loan were used, in part, to pay off in full a mortgage loan secured by the related Mortgaged Property that was subject to a foreclosure action due to a maturity default. |
Certain of the borrowers, principals of the borrowers and other entities under the control of such principals are or previously have been parties to bankruptcy proceedings, criminal proceedings, foreclosure proceedings, deed-in-lieu of foreclosure transactions and/or mortgage loan workouts, in addition to any bankruptcy related litigation issues discussed above in “—Litigation Considerations”, which in some cases may have involved a Mortgaged Property that secures a Mortgage Loan to be included in the Issuing Entity. For example, with respect to the 20 largest Mortgage Loans (considering any Crossed Group as a single Mortgage Loan, and considering any related Mortgage Loans under common borrower sponsorship) and other than as set forth above:
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Pasadena Office Tower, representing approximately 5.8% of the Initial Pool Balance, the related sponsors were involved in a discounted payoff relating to an unrelated $3,800,000 loan originated in 2006 secured by an unrelated retail property. The related sponsors also participated in a workout of an unrelated $10,000,000 loan, which was originated in 2006 and secured by an unrelated retail property, after a shadow anchor at the related property vacated its space, and the loan went into special servicing and was ultimately sold to a third party. |
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· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Orinda Square, representing approximately 3.1% of the Initial Pool Balance, three unrelated entities controlled by the borrower sponsor were parties to foreclosure proceedings in July 2010, April 2012 and September 2012, which proceedings were unrelated to the Mortgaged Property. The borrower sponsor is currently party to a separate foreclosure proceeding expected to conclude in July 2015 that is unrelated to the Mortgaged Property. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Park at Sugar Creek, representing approximately 3.1% of the Initial Pool Balance, one of the borrower sponsors was party to foreclosure proceedings in December 2011 and a discounted payoff (through a discounted purchase of the related debt instrument) that were unrelated to the Mortgaged Property. |
· | With respect to the Mortgage Loans secured by the Mortgaged Properties identified on Annex A to this prospectus supplement as Promenades Plaza and Highlands Plaza, representing approximately 2.0% and 0.7%, respectively, of the Initial Pool Balance, the related sponsor was a party to mortgage loan defaults and foreclosure proceedings in 2009, 2010 and 2012, which proceedings were unrelated to the related Mortgaged Property. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Hagerstown Plaza, representing approximately 2.0% of the Initial Pool Balance, the borrower sponsors were party to a foreclosure proceeding in October 2005, which proceeding was unrelated to the Mortgaged Property. The borrower sponsors also negotiated a discounted payoff of a note in 2011 that was unrelated to the Mortgaged Property. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Oakmont Apartments, representing approximately 1.5% of the Initial Pool Balance, an entity under the control of one of the borrower sponsors was party to 8 foreclosure proceedings from 2009 to 2011 that were unrelated to the Mortgaged Property. In addition, such entity held general partner interests in a borrowing entity that was found by the IRS to have wrongly claimed low-income housing tax credits for 2007, 2008 and 2009 in connection with two properties that were unrelated to the Mortgaged Property. Such borrowing entity defaulted on the two mortgage loans secured by those properties in 2013. The limited partner of such borrowing entity purchased the mortgage loans to avoid foreclosure and settled with the general partner in 2014. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Butterfield Shopping Center, representing approximately 1.4% of the Initial Pool Balance, the related sponsor is in the process of negotiating a modification and restructuring of an unrelated loan. The sponsor has also been involved in four prior foreclosures, as well as two loans which resulted in discounted payoffs. |
We cannot assure you that there are no other bankruptcy proceedings, foreclosure proceedings, deed-in-lieu of foreclosure transactions and/or mortgage loan workout matters that involved one or more Mortgage Loans or Mortgaged Properties, and/or a guarantor, borrower, sponsor or other party to a Mortgage Loan.
Certain risks relating to bankruptcy proceedings are described in “Risk Factors—A Bankruptcy Proceeding May Result in Losses and Delays in Realizing on the Mortgage Loans” in this prospectus supplement and “Certain Legal Aspects of the Mortgage Loans—Bankruptcy Issues” in the prospectus.
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Tenant Issues
Tenant Concentrations
Mortgaged properties that are owner-occupied or leased to a single tenant, or a tenant that makes up a significant portion of the rental income, also are more susceptible to interruptions of cash flow if that tenant’s business operations are negatively impacted, if that tenant defaults or if that tenant fails to renew its lease. This is so because:
· | the financial effect of the absence of rental income may be severe; |
· | more time may be required to re-lease the space; and |
· | substantial capital costs may be incurred to make the space appropriate for replacement tenants. |
See Annex A to this prospectus supplement for tenant lease expiration dates for the 5 largest tenants (based on net rentable square footage) at each retail, office, industrial and mixed use Mortgaged Property.
The Mortgaged Properties have single tenants as set forth below:
· | Eight (8) of the Mortgaged Properties, securing in whole or in part 6 Mortgage Loans, representing approximately 4.6% of the Initial Pool Balance by allocated loan amount, are each leased to a single tenant. |
· | No Mortgaged Property leased to a single tenant secures a Mortgage Loan representing more than approximately 2.1% of the Initial Pool Balance. |
With respect to certain of these Mortgaged Properties that are leased to a single tenant, the related leases may expire prior to, or soon after, the maturity dates of the Mortgage Loans or the related tenant may have the right to terminate the lease prior to the maturity date of the Mortgage Loan. If the current tenant does not renew its lease on comparable economic terms to the expired lease, if a single tenant terminates its lease or if a suitable replacement tenant does not enter into a new lease on similar economic terms, there could be a negative impact on the payments on the related Mortgage Loans.
Set forth below are certain tenants that are among the 5 largest tenants (based on net rentable square footage) at each of 2 or more Mortgaged Properties that collectively secure 2.0% or more of the Initial Pool Balance:
· | FiServ Solutions, Inc. is a tenant at each of 2 Mortgaged Properties, and such Mortgaged Properties secure approximately 14.5%, in the aggregate, of the Initial Pool Balance based on allocated loan amount. |
· | JP Morgan Chase is a tenant at each of 2 Mortgaged Properties, and such Mortgaged Properties secure approximately 4.0%, in the aggregate, of the Initial Pool Balance based on allocated loan amount. |
· | Rite Aid is a tenant at each of 3 Mortgaged Properties, and such Mortgaged Properties secure approximately 3.6%, in the aggregate, of the Initial Pool Balance based on allocated loan amount. |
· | Winn-Dixie is a tenant at each of 2 Mortgaged Properties, and such Mortgaged Properties secure approximately 2.7%, in the aggregate, of the Initial Pool Balance based on allocated loan amount. |
· | Wal-Mart Stores East, LP (“Wal-Mart”) is a tenant at each of 2 Mortgaged Properties, and such Mortgaged Properties secure approximately 2.1%, in the aggregate, of the Initial Pool Balance based on allocated loan amount. |
In the event of a default by that tenant, if the related lease expires prior to the Mortgage Loan maturity date and the related tenant fails to renew its lease or if such tenant exercises an early termination option, there would
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likely be an interruption of rental payments under the lease and, accordingly, insufficient funds available to the borrower to pay the debt service on the loan. In certain cases where the tenant owns the improvements to the Mortgaged Property, the related borrower may be required to purchase such improvements in connection with the exercise of its remedies.
Lease Expirations and Terminations
Lease Expirations. See Annex A to this prospectus supplement for tenant lease expiration dates for the 5 largest tenants (based on net rentable area leased) at each retail, office, industrial and mixed use Mortgaged Property. Even if none of the top 5 tenants at a particular Mortgaged Property have leases that expire before, or shortly after, the maturity of the related Mortgage Loan, there may be a significant percentage of leases at a particular Mortgaged Property that expire in a single calendar year, a rolling 12-month period or prior to, or shortly after, the maturity of a Mortgage Loan. Furthermore, some of the Mortgaged Properties have significant leases or a significant concentration of leases that expire before, or shortly after, the maturity of the related Mortgage Loan. Identified below are certain lease expirations or concentrations of lease expirations with respect to the retail, office, industrial and mixed use Mortgaged Properties:
· | In certain cases, the lease of a single tenant, major tenant or anchor tenant at a multi-tenanted Mortgaged Property expires prior to the maturity date (or in the case of an ARD Loan, the Anticipated Repayment Date) of the related Mortgage Loan. For example, with respect to the Mortgage Loans secured, in whole or in part, by the Mortgaged Properties identified in the table below, each such Mortgaged Property is occupied by a single tenant under a lease which expires prior to, or in the same month of, the maturity date (or in the case of an ARD Loan, the Anticipated Repayment Date) of the related Mortgage Loan. |
Percent of the | |||||||
Initial Pool Balance | |||||||
by Allocated Loan | Lease | ||||||
Mortgaged Property Name | Amount | Expiration Date | Maturity Date | ||||
11325 Commercial Parkway | 0.1% | 1/3/2017 | 6/6/2025 |
· | With respect to the Mortgaged Properties identified in the table below, one or more tenant leases representing in the aggregate 50% or greater of the net rentable square footage at the related Mortgaged Property (excluding Mortgaged Properties leased to a single tenant) expire in a single calendar year that is prior to or the same year as the maturity date (or in the case of an ARD Loan, the Anticipated Repayment Date) of the related Mortgage Loan. There may be other Mortgaged Properties as to which leases representing at least 50% or greater of the net rentable square footage at the related Mortgaged Property expire over several calendar years prior to maturity of the related Mortgage Loan. |
Percent of the | ||||||||||
Initial Pool | ||||||||||
Balance by | Percentage of | |||||||||
Allocated Loan | Leases | Calendar Year of | ||||||||
Mortgaged Property Name | Amount | Expiring(1) | Expiration | Maturity Date | ||||||
135 South LaSalle | 13.8% | 68.1% | 2020 | 5/6/2025 | ||||||
St. Anthony’s Healthplex North | 4.1% | 84.8% | 2025 | 5/1/2025 | ||||||
Mesa Town Center | 3.1% | 51.7% | 2019 | 6/6/2025 | ||||||
3101 Western Avenue | 1.3% | 54.4% | 2022 | 4/6/2025 | ||||||
300 Elliott Avenue West | 1.1% | 79.0% | 2016 | 4/6/2025 | ||||||
Southport Center | 1.0% | 52.5% | 2021 | 6/6/2025 | ||||||
Highlands Plaza | 0.7% | 60.1% | 2022 | 6/6/2025 | ||||||
MRN III | 0.5% | 100.0% | 2020 | 6/6/2025 | ||||||
190 Queen Anne Avenue North | 0.4% | 79.9% | 2023 | 4/6/2025 | ||||||
Cedar - Dover Plaza | 0.3% | 67.3% | 2018 | 5/6/2025 | ||||||
11145 and 11165 Commercial Parkway | 0.2% | 73.2% | 2017 | 6/6/2025 | ||||||
18 West Mercer Street | 0.1% | 57.2% | 2017 | 4/6/2025 | ||||||
11285 Commercial Parkway | 0.1% | 70.4% | 2017 | 6/6/2025 | ||||||
11085 Commercial Parkway | 0.1% | 50.0% | 2017 | 6/6/2025 | ||||||
11085 Commercial Parkway | 0.1% | 50.0% | 2018 | 6/6/2025 |
(1) | Calculated based on a percentage of net rentable square footage of the related Mortgaged Property. |
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· | In addition, with respect to certain other Mortgaged Properties, there are leases that represent in the aggregate a material portion (but less than 50%) of the net rentable square footage at the related Mortgaged Property that expire in a single calendar year prior to, or shortly after, the maturity of the related Mortgage Loan. |
Lease Terminations. Certain Mortgage Loans have material lease early termination options. Leases often give tenants the right to terminate the related lease, abate or reduce the related rent, and/or exercise certain remedies against the related borrower for various reasons or upon various conditions, including
(i) if the borrower for the applicable Mortgaged Property allows uses at the Mortgaged Property in violation of use restrictions in current tenant leases,
(ii) if the borrower or any of its affiliates owns other properties within a certain radius of the Mortgaged Property and allows uses at those properties in violation of use restrictions,
(iii) if the borrower fails to provide a designated number of parking spaces,
(iv) if there is construction at the related Mortgaged Property or an adjacent property (whether or not such adjacent property is owned or controlled by the borrower or any of its affiliates) that may interfere with visibility of, access to or a tenant’s use of the Mortgaged Property or otherwise violate the terms of a tenant’s lease,
(v) upon casualty or condemnation with respect to all or a portion of the Mortgaged Property that renders such Mortgaged Property unsuitable for a tenant’s use or if the borrower fails to rebuild such Mortgaged Property within a certain time,
(vi) if a tenant’s use is not permitted by zoning or applicable law,
(vii) if the tenant is unable to exercise an expansion right,
(viii) if the borrower does not complete certain improvements to the property as contemplated in the lease,
(ix) if the borrower leases space at the Mortgaged Property or within a certain radius of the Mortgaged Property to a competitor,
(x) if the tenant fails to meet certain sales targets or other business objectives for a specified period of time,
(xi) if certain anchor or significant tenants at the subject property go dark or terminate their leases,
(xii) if the landlord violates the tenant’s exclusive use rights for a specified period of time,
(xiii) if the borrower defaults on any other obligations under the lease, or
(xiv) based upon contingencies other than those set forth in this “—Lease Expirations and Terminations” section.
We cannot assure you that all or any of the borrowers will comply with their lease covenants or such third parties will act in a manner required to avoid any termination and/or abatement rights of the related tenant.
Identified below are certain material termination rights or situations in which the tenant may no longer occupy its leased space or pay full (or any) rent.
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Unilateral Lease Termination Rights
Certain of the tenant leases permit the related tenant to unilaterally terminate its lease upon providing notice of such termination within a specified period prior to the termination date. For example, among the 5 largest tenants by net rentable square footage at the Mortgaged Properties securing the 10 largest Mortgage Loans (considering any Crossed Group as a single Mortgage Loan) by aggregate Cut-off Date Balance, or those Mortgaged Properties with a tenant that leases at least 20% of the net rentable square footage at the related Mortgaged Property (in each case excluding government tenants, which are described further below):
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Selig Office Portfolio, representing approximately 9.95% of the Initial Pool Balance, solely among the five largest tenants at each of such Mortgaged Properties there are eight tenants, collectively representing approximately 13.6% of the aggregate net rentable square footage of the Selig Office Portfolio Mortgaged Properties, which have the option to terminate their respective leases upon providing notice of such termination within a specified period prior to the termination date. |
· | With respect to the Mortgaged Property identified on Annex A to this prospectus supplement as MRN III, securing approximately 0.5% of the Initial Pool Balance by allocated loan amount, the largest tenant, ExactCare Pharmacy, representing 61.1% of the net rentable square footage at such Mortgaged Property, has termination options exercisable in 2019 and 2020. |
· | With respect to the Mortgaged Property identified on Annex A to this prospectus supplement as 210 West Huron, securing approximately 0.5% of the Initial Pool Balance by allocated loan amount, the largest tenant at the Mortgaged Property, MLive, representing 46.8% of the Mortgaged Property, may terminate its lease in 2020 upon 12 months’ notice and payment of the sum of (i) the unamortized amount of the tenant allowance at an interest rate of 6% per annum, (ii) all unamortized brokerage commissions, and (iii) $50,869. |
· | With respect to the Mortgaged Property identified on Annex A to this prospectus supplement as 1081 and 1083 Harkins Road, securing approximately 0.2% of the Initial Pool Balance by allocated loan amount, the second largest tenant, Applied Industrial Technologies, representing approximately 29.5% of the net rentable area at the related Mortgaged Property, has the one-time right to terminate the lease at the end of the third year of the renewal term (August 2016) provided the tenant gives six months’ notice and pays a termination fee. |
Rights to Terminate Lease or Abate or Reduce Rent Triggered by Failure to Meet Business Objectives or Actions of Other Tenants
Certain of the tenant leases for the Mortgaged Properties permit the related tenant to terminate its lease and/or abate or reduce rent if the tenant fails to meet certain sales targets or other business objectives for a specified period of time. We cannot assure you that all or any of these tenants will meet the sales targets or business objectives required to avoid any termination and/or abatement rights. For example, taking into account the 5 largest tenants (based on net rentable square footage) at those Mortgaged Properties securing the 20 largest Mortgage Loans (considering the Crossed Group as a single Mortgage Loan) by aggregate Cut-off Date Balance:
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Hagerstown Plaza, representing approximately 2.0% of the Initial Pool Balance, the fifth largest tenant, Holiday Hair, representing approximately 2.1% of the net rentable square footage of the related Mortgaged Property, has a termination option based on failure to meet certain sales targets. |
Certain of the tenant leases for the Mortgaged Properties may permit affected tenants to terminate their leases and/or abate or reduce rent if another tenant at the subject Mortgaged Property or a tenant at an adjacent or nearby property terminates its lease or goes dark, or if a specified percentage of the Mortgaged Property is unoccupied. For example, taking into account the 5 largest tenants (based on net rentable square footage) at
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those Mortgaged Properties securing the 20 largest Mortgage Loans (considering any Crossed Group as a single Mortgage Loan) by aggregate Cut-off Date Balance:
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Promenades Plaza, representing approximately 2.0% of the Initial Pool Balance, each of (i) the largest tenant, Winn-Dixie, representing approximately 23.9% of the net rentable area at the related Mortgaged Property, and (ii) the second largest tenant, Bealls Outlet, representing approximately 17.9% of the net rentable area at the related Mortgaged Property, have co-tenancy provisions in their respective leases. If at any point during the term of its lease the overall occupancy at the Mortgaged Property drops below 50%, Winn-Dixie may terminate its lease. If Winn-Dixie ceases to operate its business for six consecutive months, then Bealls Outlet may pay a reduced rent of 3% of gross receipts. If a suitable replacement for Winn-Dixie is not found after 18 consecutive months, then Bealls Outlet may terminate its lease. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Hagerstown Plaza, representing approximately 2.0% of the Initial Pool Balance, the fifth largest tenant, Holiday Hair, representing approximately 2.1% of the net rentable square footage of the related Mortgaged Property, may pay reduced rent or terminate its lease if a certain tenant goes dark. |
In addition to termination options tied to certain triggers as set forth above that are common with respect to retail properties, certain tenant leases permit the related tenant to terminate its lease without any such triggers.
Certain of the tenant leases permit the related tenant to terminate its lease based upon contingencies other than those set forth above in this “—Rights to Terminate Lease or Abate or Reduce Rent Triggered by Failure to Meet Business Objectives or Actions of Other Tenants” subsection.
See “Structural and Collateral Term Sheet” in Annex B to this prospectus supplement for more information on material lease termination options relating to the largest 20 Mortgage Loans.
Rights to Cease Operations (Go Dark) at the Leased Property
Certain of the tenant leases may permit a tenant to go dark at any time. For example, taking into account (i) the 5 largest tenants (based on net rentable square footage) at those Mortgaged Properties securing the largest 20 Mortgage Loans (considering any Crossed Group as a single Mortgage Loan) by aggregate Initial Pool Balance or (ii) cases where any Mortgaged Property is leased to a single tenant who has the option to go dark:
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Walgreens-Smithfield, representing approximately 0.7% of the Initial Pool Balance, the sole tenant, Walgreens, is permitted to go dark at any time subject to the terms of its lease. |
There may be other tenant leases, other than those disclosed above, that do not require the related tenant to continue to operate its space at the related Mortgaged Property, and therefore such tenants may also have the option to go dark at any time, but such right to go dark is not expressly provided for under the subject lease.
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Termination Rights of Government Sponsored Tenants
Certain of the Mortgaged Properties, as set forth in the table below, may be leased in whole or in part by government sponsored tenants. Government sponsored tenants frequently have the right to cancel their leases at any time or after a specific time (in some cases after the delivery of notice) or for lack of appropriations. For example, set forth below are certain government leases that (i) have these types of risks, and (ii) relate to a tenant that individually represents more than 5% of the base rent at the related Mortgaged Property. One or more other leases at the related Mortgaged Property representing less than 5% of the base rent at such property could also have these types of risks.
% of Initial | % of Net | |||
Pool | Rentable | % of Base | ||
Mortgaged Property Name | Balance | Tenant | Area | Rent |
Pasadena Office Tower | 5.8% | Department of Rehabilitation(1) | 5.5% | 7.3% |
1000 Second Avenue | 3.5% | WA State Housing Finance Commission(2) | 5.9% | 5.3% |
(1) | The related tenant may terminate the lease at any time upon 90 days’ notice. |
(2) | The related tenant may terminate its lease at any time by giving at least 6 months’ notice and subject to certain conditions contained in its lease. |
Other Tenant Termination Issues
With respect to the Mortgage Loan secured in part by the Mortgaged Property identified on Annex A to this prospectus supplement as 300 Elliott Avenue West, representing approximately 1.1% of the Initial Pool Balance by allocated loan amount, the largest tenant, Holland America, representing approximately 79.2% of the net rentable area at the related Mortgaged Property, has the right to contract its space by up to 10% per year on a noncumulative basis. However, the premises may not be reduced below 71,300 square feet.
In addition, anchor tenants at, and shadow anchor tenants with respect to, certain Mortgaged Properties may close or otherwise become vacant. We cannot assure you that any such anchor tenants would be replaced in a timely manner or without incurring material additional costs to the related borrower and resulting in adverse economic effects.
Rights to Sublease
Certain of the Mortgaged Properties may have tenants that sublet a portion of their space or have provided notice of their intent to sublet out a portion of their space in the future. For example, taking into account (i) the 5 largest tenants (based on net rentable square footage) at those Mortgaged Properties securing the 20 largest Mortgage Loans (considering any Crossed Group as a single Mortgage Loan) or (ii) cases where 10% or more of the aggregate net rentable area at a Mortgaged Property is sublet:
· | With respect to the Mortgaged Property identified on Annex A to this prospectus supplement as 1000 Second Avenue, securing approximately 3.5% of the Initial Pool Balance by allocated loan amount, the largest tenant, DDB Seattle, representing approximately 12.1% of the net rentable area at the Mortgaged Property, subleases 51,179 square feet of its space to ThePlatform through its lease expiration on March 31, 2018. ThePlatform has executed a lease on floors 9, 10 and 11 of the 1000 Second Avenue Mortgaged Property that commences on April 1, 2018 and expires on March 31, 2023. |
· | With respect to the Mortgaged Property identified on Annex A to this prospectus supplement as Mesa Town Center, securing approximately 3.1% of the Initial Pool Balance, the largest tenant, Albertsons, representing approximately 23.3% of the net rentable area at the Mortgaged Property, has subleased all of its space to a third party, Seafood City, through the lease expiration date. |
· | With respect to the Mortgaged Property identified on Annex A to this prospectus supplement as 3131 Elliott Avenue, securing approximately 1.1% of the Initial Pool Balance by allocated loan amount, the largest tenant, Emeritus Corporation, representing approximately 40.4% of the net rentable area at the Mortgaged Property, subleases 7,969 square feet of its space to TCS & Starquest Expeditions, Inc. (sublease expires November 30, 2021) and 26,386 square feet of its space to Hart-Crowser (sublease expires September 30, 2025). |
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Tenants Not Yet in Occupancy or Paying Rent, Leases Under Negotiation and LOI’s
Tenants under certain leases included in the Underwritten Net Cash Flow, Underwritten Net Operating Income and/or Occupancy may not be in physical occupancy, may not have commenced paying rent or may be in the process of negotiating such lease. For example, with respect to single tenant properties or tenants that are one of the top 5 tenants by net rentable square footage at a Mortgaged Property or tenants individually or in the aggregate representing more than 25% of the net rentable area at the Mortgaged Property, certain of such tenants have not taken possession or commenced paying rent as set forth below:
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Orinda Square, representing approximately 3.1% of the Initial Pool Balance, the fifth largest tenant, Coldwell Banker Residential, representing approximately 6.2% of the net rentable area at the related Mortgaged Property, has an executed lease but has not yet taken occupancy or begun paying rent. We cannot assure you that this tenant will take occupancy or begin paying rent as expected or at all. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Park at Sugar Creek, representing approximately 3.1% of the Initial Pool Balance, the second largest tenant, Plaza Jewelers, representing approximately 7.2% of the net rentable area at the related Mortgaged Property, is temporarily occupying in-line space until the buildout of its outparcel space is complete. Additionally, the third largest tenant, Majestic Kids, representing approximately 4.3% of the net rentable area at the related Mortgaged Property, has an executed lease but has not yet opened for business or begun paying rent. We cannot assure you that these tenants will take occupancy or begin paying rent as expected or at all. |
· | With respect to the Mortgaged Property identified on Annex A to this prospectus supplement as Infinity Corporate Center, securing approximately 0.9% of the Initial Pool Balance, the second largest tenant, Cleveland Urology Associates, representing approximately 24.8% of the net rentable square footage at the Mortgaged Property, and the third largest tenant, Sonobello, representing approximately 8.3% of the net rentable square footage at the Mortgaged Property, have not yet taken occupancy at their respective spaces. After taking occupancy, both tenants will be in a rent abatement period for four (4) and two (2) months, respectively. At origination of the Mortgage Loan, the borrower deposited $1,325,356.39 into a lender-controlled tenant improvements and leasing commissions reserve, of which $235,923 is allocated to the rent abatement periods. |
· | With respect to the Mortgaged Property identified on Annex A to this prospectus supplement as 200 First Avenue West, securing approximately 0.3% of the Initial Pool Balance by allocated loan amount, the largest tenant, CKCA2 Inc. (Cosmo Kids), representing approximately 11.8% of the net rentable area at the related Mortgaged Property, and the second largest tenant, Koru Careers, Inc., representing approximately 10.3% of the net rentable area at the related Mortgaged Property, both have executed leases but neither has taken occupancy or begun paying rent. An unexecuted lease holdback of $3,900,807 was established at the origination of the Mortgage Loan and has been released to the related borrower. We cannot assure you that these tenants will take occupancy or begin paying rent as expected or at all. |
In addition, in some cases, tenants at a Mortgaged Property may have signed a letter of intent but not executed a lease with respect to the related space. We cannot assure you that any such proposed tenant will sign a lease or take occupancy at the related Mortgaged Property.
In addition, the underwritten occupancy, Underwritten Net Cash Flow and Underwritten Net Operating Income of the Mortgaged Properties may reflect tenants, and rents from tenants, whose lease terms or renewal leases are under negotiation but not yet signed. In addition, certain of the Mortgage Loans may have tenants who are leasing their spaces on a month-to-month basis and have the right to terminate their leases on a monthly basis. For example, with respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Chester County Multifamily Portfolio, representing approximately 0.7% of the Initial Pool Balance, each of the related Mortgaged Properties is leased to tenants on a month-to-month basis.
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In these cases we cannot assure you that these tenants will take occupancy, begin paying rent or execute these leases. If these tenants do not take occupancy of the leased space, begin paying rent or execute these leases, it could result in a higher vacancy rate and re-leasing costs that may adversely affect cash flow on the related Mortgage Loan.
Tenants in Financial Distress or Affiliated with a Parent or Related to a Chain That Is in Financial Distress
In addition, tenants under certain leases included in the Underwritten Net Cash Flow, Underwritten Net Operating Income and/or Occupancy may be in financial distress, or may be part of a chain that is in financial distress as a whole, or the tenant’s parent company may have implemented or expressed an intent to implement a plan to consolidate or reorganize its operations, close a number of stores in the chain, reduce exposure, relocate stores or otherwise reorganize its business to cut costs.
Furthermore, commercial tenants having multiple leases may experience adverse business conditions that result in their deciding to close under-performing stores.
On October 20, 2014, Walgreen Co. (“Walgreens”) announced it closed 67 stores during fiscal year 2014 and is pursuing a cost reduction initiative with the goal of realizing $1 billion in cost savings by fiscal year 2017. On April 9, 2015, Walgreens announced plans to close 200 stores as part of a $500 million cost-cutting measure. In the case of the Mortgaged Properties identified on Annex A to this prospectus supplement as Walgreens-Smithfield and Walgreens Winston-Salem, securing approximately 1.3% of the Initial Pool Balance, by allocated loan amount, Walgreens is a tenant at such Mortgaged Properties. We cannot assure you that Walgreens will remain open for business or that the closing of any other Walgreens store will not impact other Mortgaged Properties securing Mortgage Loans in the Mortgage Pool.
On December 4, 2014, Sears Holdings Corp. (“Sears”) announced a year to date net loss of approximately $1.523 billion and the closure of approximately 235 underperforming stores in fiscal year 2014. In the case of the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Black Rock Commons, representing approximately 0.9% of the Initial Pool Balance, Sears is an anchor at the related Mortgaged Property. Certain of the tenant leases at the related Mortgaged Property may permit tenants to terminate their leases and/or abate or reduce rent if Sears terminates its lease or goes dark. We cannot assure you that Sears will not continue to report earnings losses or otherwise exhibit signs of financial distress or that its stores will remain open for business. We further cannot assure you that the closing of any other Sears store will not impact other Mortgaged Properties securing Mortgage Loans in the Mortgage Pool.
Not For Profit Tenants
Certain Mortgaged Properties may have tenants or sub-tenants that are charitable institutions that generally rely on contributions from individuals and government grants or other subsidies to pay rent on such space and other operating expenses. For example:
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, representing approximately 4.1% of the Initial Pool Balance, the portion of the property leased to the largest tenant, SSM Health Care of Oklahoma, Inc. (“SSM”), qualifies for an exemption of ad valorem real estate taxes because SSM is a non-profit entity. The tax exemption is in effect during the term of the SSM lease and it is the responsibility of the borrower to notify the tax assessor’s office of any changes to the term or occupancy. The Mortgaged Property’s real estate tax liability has been calculated based on the portion of the building not occupied by SSM. If SSM does not maintain its exemption for ad valorem real estate taxes, SSM does not have any right to terminate its lease, and is responsible for payment of its ad valorem real estate taxes under the triple-net structure of its lease. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Park at Sugar Creek, representing approximately 3.1% of the Initial Pool Balance, the largest tenant, Memorial Hermann, representing approximately 28.7% of the related Mortgaged Property’s net rentable square footage, is a not-for-profit urgent care facility. The tenant does not have a unilateral termination right. |
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Tenants that are charitable institutions that generally rely on contributions from individuals and government grants or other subsidies to pay rent on such space and other operating expenses may default upon their respective leases should such contributions, grants or subsidies no longer be available.
See “Structural and Collateral Term Sheet” in Annex B to this prospectus supplement for more information on other tenant matters relating to the largest 20 Mortgage Loans (considering any Crossed Group as a single Mortgage Loan).
See the footnotes to Annex A to this prospectus supplement for further information regarding the 5 largest tenants by net rentable square footage at the Mortgaged Properties.
Purchase Options, Rights of First Offer and Rights of First Refusal
Below are certain purchase options, rights of first offer and rights of first refusal to purchase all or a portion of certain Mortgaged Properties:
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as 135 South LaSalle, representing approximately 13.8% of the Initial Pool Balance, the largest tenant at the Mortgaged Property, Bank of America, has a right of first offer to purchase the Mortgaged Property in the event the borrower desires to sell or convey all or any portion of, or interest in, the Mortgaged Property if, at such time, such tenant (x) is not in default under its lease and (y) (together with any affiliate) is leasing at least 300,000 square feet of rentable area at the Mortgaged Property. In such event, the borrower is required to notify tenant of such intention to sell the Mortgaged Property along with the terms and conditions under which the borrower desires to do so. The tenant may accept the offer by (i) giving written notice to borrower within 20 days (or, if borrower has not commenced formal marketing, 30 days) after its receipt of the offer and (ii) depositing an amount not to exceed 5% of the proposed purchase price identified in the notice to tenant into an escrow account. If the tenant fails to timely accept the offer, the borrower is required to re-offer the Mortgaged Property to the tenant in the event that the borrower subsequently reduces the purchase price previously identified as acceptable to the borrower by more than 10%. The right of the tenant described in this paragraph does not apply to either a transfer in connection with a foreclosure or deed-in-lieu of foreclosure or the first sale of the property thereafter. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, representing approximately 4.1% of the Initial Pool Balance, the largest tenant, SSM, which leases approximately 70% of the net rentable area at the Mortgaged Property, has a right of first refusal to purchase the related Mortgaged Property within 90 days following the borrower’s notice to SSM of its receipt of an offer to purchase the Mortgaged Property (the “SSM ROFR”). The SSM ROFR does not apply in connection with a foreclosure or a transfer immediately following a foreclosure. Additionally, if the related borrower decides not to repair any damage or destruction to the Mortgaged Property such that the cost of repair is 20% or more of the then replacement cost of the Mortgaged Property, SSM has the option to purchase the Mortgaged Property for a purchase price equal to the then fair market value of the property (the “SSM Purchase Option”), which SSM may exercise by providing written notice of such exercise to the borrower within 90 days after receipt of the borrower’s notice that it will not repair the damage. SSM has not entered into a subordination, non-disturbance and attornment agreement in favor of the lender with respect to the SSM Purchase Option. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Mesa Town Center, representing approximately 3.1% of the Initial Pool Balance, the largest tenant, Albertsons, has a right of first refusal to purchase Tax Lots 69 and 70 (which do not comprise the entire Mortgaged Property) in the event the landlord receives a bona fide offer to purchase such lots. A subordination and non-disturbance agreement was not obtained. |
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Oklahoma Walmart Portfolio, representing approximately 2.1% of the Initial Pool Balance, the sole tenant at the portfolio of Mortgaged Properties, Wal-Mart, has a right of first refusal to receive a copy of any negotiated purchase agreement or term sheet for |
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the sale of the related leased premises and to elect to purchase its leased premises within 15 days following the borrower’s receipt of such negotiated purchase agreement or term sheet. The right of first refusal does not apply in connection with a foreclosure or deed-in-lieu of foreclosure. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Walgreens-Smithfield, representing approximately 0.7% of the Initial Pool Balance, the sole tenant, Walgreens, has a right of first refusal to purchase the Mortgaged Property within 21 days following its receipt of notice from the borrower setting forth the terms and conditions of a bona fide third party offer to purchase the Mortgaged Property. The right of first refusal does not apply in connection with a foreclosure, but does, however, apply to subsequent purchasers of the Mortgaged Property. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Walgreens Winston-Salem, representing approximately 0.6% of the Initial Pool Balance, the sole tenant at the Mortgaged Property, Walgreens, has a right of first refusal pursuant to its lease to purchase the Mortgaged Property if the borrower receives a bona fide offer from a third party that the borrower intends to accept. The right of first refusal does not apply to a foreclosure, deed-in-lieu of foreclosure or any other enforcement action under the Mortgage Loan documents; however, such right of first refusal applies to subsequent purchasers of the related Mortgaged Property. |
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Rite Aid Portfolio , representing approximately 0.5% of the Initial Pool Balance, the sole tenant at each of the Mortgaged Properties has a right of first refusal to purchase all or any portion of its leased premises from the borrower upon the same terms and conditions as a third-party offer secured or received by the borrower within 20 days of receiving notice of such offer from the landlord. The tenant’s right of first refusal does not apply in connection with a foreclosure or deed-in-lieu of foreclosure; however, such right of first refusal applies to subsequent purchasers of the respective leased premises. |
Affiliated Leases
Certain of the Mortgaged Properties are leased in whole or in part by borrowers or borrower affiliates. Set forth below are examples of Mortgaged Properties at which at least 5.0% of (i) the gross income at the Mortgaged Property relates to leases between the borrower and an affiliate of the borrower or (ii) the net rentable area at the Mortgaged Property is leased to an affiliate of the borrower:
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, representing approximately 4.1% of the Initial Pool Balance, Miller Architects, Inc. and Ancon Development Corporation, each of which is an affiliate of the borrower, lease approximately 6.1% and 2.1%, respectively, of the net rentable area at the related Mortgaged Property. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Infinity Corporate Center, representing approximately 0.9% of the Initial Pool Balance, the second largest tenant at the Mortgaged Property, Cleveland Urology Associates, representing approximately 24.8% of the net rentable area at the Mortgaged Property, is leased to an affiliate of the Mortgage Loan sponsor. This lease represents approximately 23.8% of the gross income at the Mortgaged Property. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as the Diamonette Building, representing approximately 0.8% of the Initial Pool Balance, the largest tenant, Diamonette, an affiliate of the borrower, leases approximately 64.5% of the net rentable area at the related Mortgaged Property. |
Other Mortgaged Properties may have tenants that are affiliated with the related borrower but those tenants do not represent more than 5.0% of the gross income or net rentable area of the related Mortgaged Property.
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Insurance Considerations
In the case of 48 Mortgaged Properties, which secure, in whole or in part, 28 Mortgage Loans, representing approximately 69.3% of the Initial Pool Balance by allocated loan amount, the related borrower maintains insurance under blanket policies.
Further, certain Mortgaged Properties may be insured, in whole or in part, by a sole or significant tenant. For example:
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Oklahoma Walmart Portfolio, representing approximately 2.1% of the Initial Pool Balance, the insurance requirements under the Mortgage Loan documents will be deemed satisfied if (i) the lease with the single tenant at the Mortgaged Property, Wal-Mart, is in full force and effect, (ii) no default beyond any applicable notice and cure period is continuing under such lease, (iii) Wal-Mart (or any lease guarantor thereof) remains fully liable for the obligations and liabilities under its lease and maintains a credit rating from S&P of at least “BBB”, (iv) such lease will remain in full force and effect following a casualty and Wal-Mart is obligated to rebuild and/or repair the Mortgaged Property at its sole cost and expense with no period of rent abatement and (v) such tenant maintains, either through a program of self-insurance or otherwise, the insurance required to be maintained by it under its lease. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Hagerstown Plaza, representing approximately 2.0% of the Initial Pool Balance, the related borrower is permitted to rely on the property and general liability insurance obtained by the largest tenant at the Mortgaged Property, Giant Food Stores, LLC (doing business as Martin’s Food Stores), to satisfy the portion of its insurance requirements relating to the leased premises occupied by such tenant. Currently, the tenant is providing such insurance coverage. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Walgreens-Smithfield, representing approximately 0.7% of the Initial Pool Balance, the sole tenant, Walgreens, is required to insure (or self-insure) the Mortgaged Property pursuant to its lease, and the related borrower is permitted to rely on such insurance or self-insurance. Currently, casualty and liability insurance are maintained by the tenant. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Walgreens Winston-Salem, representing approximately 0.6% of the Initial Pool Balance, the Mortgage Loan documents provide that for so long as the sole tenant at the Mortgaged Property is Walgreens and such tenant is maintaining the “all-risk” or “special perils” insurance coverage, the deductible is permitted to be $100,000. |
In addition, with respect to certain Mortgage Loans, the insurable value of the related Mortgaged Property as of the origination date of the related Mortgage Loan was lower than the principal balance of the related Mortgage Loan.
See“Risk Factors—Risks Associated with Blanket Insurance Policies or Self-Insurance” and “—Earthquake, Flood and Other Insurance May Not be Available or Adequate” in this prospectus supplement.
In addition, with respect to Mortgaged Properties that are part of condominium regimes, the insurance may be maintained by the condominium association rather than the related borrower.
Further, many Mortgage Loans contain limitations on the obligation to obtain terrorism insurance. See “Risk Factors—Terrorism Insurance May Not Be Available for All Mortgaged Properties” in this prospectus supplement.
Zoning and Use Restrictions
Certain of the Mortgaged Properties are subject to restrictions that restrict the use of the Mortgaged Properties to their current use. In addition, certain of the Mortgaged Properties may be subject to restrictions relating to their current use or have other zoning issues. For example, certain of the Mortgaged Properties are
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subject to a temporary certificate of occupancy (the “TCO”). The related Mortgage Loan documents require the related borrower to use commercially reasonable efforts to maintain the TCO, or cause the sponsor of the property to maintain the TCO, and to cause the TCO to be continuously renewed at all times until a permanent certificate of occupancy (“PCO”) is obtained for the related Mortgaged Property.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Crowne Plaza Bloomington, representing approximately 1.7% of the Initial Pool Balance, a portion of the Mortgaged Property consists of the borrower’s leasehold interest in up to 300 parking spaces located in a parking garage adjacent to the hotel portion of the related Mortgaged Property pursuant to a lease agreement that expires in November 2041. The Mortgaged Property’s compliance with current parking requirements is dependent upon the parking lease agreement.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Magnolia Hotel Omaha, representing approximately 1.5% of the Initial Pool Balance, the Mortgaged Property is listed on the National Register of Historic Places and with the Omaha Landmarks Heritage Preservation Commission and is located in an area classified as an Area of Civic Importance. We cannot assure you these designations will not impact the related Mortgaged Property’s value or ability to undergo development or construction in the future.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as 210 West Huron, representing approximately 0.5% of the Initial Pool Balance, the related Mortgaged Property is comprised of the lower levels and underground parking of a retail building. Within the building, there are units that are not part of the collateral and that are subject to a condominium declaration. The Mortgaged Property and condominium portion are subject to a declaration of covenants, conditions and restrictions governing repair and rebuild requirements in the event of a casualty at the Mortgaged Property and condominium portion of the building. In the event that the Mortgaged Property and condominium portion are both destroyed or substantially damaged, the related borrower and owner of the condominium property are required to rebuild the building unless they each agree not to rebuild, in which case insurance proceeds for the Mortgaged Property and the condominium are paid to the respective owners of the improvements or its mortgagee. The related borrower has the option to purchase the condominium portion of the building after a total loss. If the related borrower does not exercise its purchase option, the related borrower and owner of the condominium portion will own the remaining property as tenants in common. In the event of a casualty or condemnation over $50,000, awards and proceeds are paid to a depositary entity that disburses the funds for restoration in accordance with the declaration. The Mortgage Loan documents require proceeds not used for, or not remaining as excess after the completion of, restoration of the building to be retained by the related lender and applied towards the Mortgage Loan.
See “Risk Factors—Risks Related to Zoning Non-Compliance and Use Restrictions” in this prospectus supplement. See also the Sponsor representation and warranty set forth in paragraph (24) (Local Law Compliance) on Annex E-1 to this prospectus supplement and any related exceptions on Annex E-2 to this prospectus supplement (subject to the limitations and qualifications set forth in the preamble to Annex E-1 to this prospectus supplement).
Appraised Value
In certain cases, appraisals may reflect both “as stabilized” and “as-is” values, although the Appraised Value reflected in this prospectus supplement with respect to each Mortgaged Property reflects only the “as-is” value, which may be based on certain assumptions, such as future construction completion, projected re-tenanting or increased tenant occupancies, other than as follows:
· | With respect to the loan-to-value ratios at maturity of 14 Mortgage Loans secured by the Mortgaged Properties or portfolios of Mortgaged Properties identified in the definitions of “LTV Ratio at Maturity/ARD” under “Description of the Mortgage Pool—Certain Calculations and Definitions” in this prospectus supplement, the related LTV Ratio at Maturity/ARD reflected in this prospectus supplement is calculated using an “as stabilized”, “as stabilized/as completed” or a “prospective market value upon stabilization” appraised value. |
· | Appraised Values are further calculated based on certain other assumptions and considerations set forth in the definition of “Appraised Value”under“Description of the Mortgage Pool—Certain |
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Calculations and Definitions” in this prospectus supplement, including, without limitation: (a) with respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Rockside Road Office Portfolio, representing approximately 4.1% of the Initial Pool Balance, the related Appraised Value of the portfolio of Mortgaged Properties taken as a whole includes, in each applicable circumstance, a 5.0% premium over the sum of the applicable Appraised Values of the individual Mortgaged Properties included in such portfolio (regardless of whether any such individual Appraised Value is, depending on the purpose for which it is being used, an “as-is” or “as stabilized” value); and (b) with respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as NY Seven Self Storage Portfolio, representing approximately 2.8% of the Initial Pool Balance, the related Appraised Value of the portfolio of Mortgaged Properties taken as a whole includes an approximately 7.5% premium over the sum of the Appraised Values of the individual Mortgaged Properties included in such portfolio. |
See “Description of the Mortgage Pool—Certain Calculations and Definitions” and “Risk Factors—Appraisals May Not Reflect Current or Future Market Value of Each Property” in this prospectus supplement.
Non-Recourse Carveout Limitations
While the Mortgage Loans generally contain non-recourse carveouts for liabilities such as a result of fraud by the borrower, certain voluntary insolvency proceedings or other matters, certain of the Mortgage Loans do not contain such carveouts, contain limitations to such carveouts and/or do not provide for a non-recourse carveout guarantor. Certain other Mortgage Loans may have additional limitations to the non-recourse carveouts as described on Annex E-2 to this prospectus supplement. See “Risk Factors—Mortgage Loans Are Non-Recourse and Are Not Insured or Guaranteed” in this prospectus supplement.
We cannot assure you that the net worth or liquidity of any non-recourse guarantor under any of the Mortgage Loans will be sufficient to satisfy any claims against that guarantor under its non-recourse guaranty. In most cases, the liquidity and net worth of a non-recourse guarantor under a Mortgage Loan will be less, and may be materially less, than the outstanding principal amount of that Mortgage Loan. In addition, there may be impediments and/or difficulties in enforcing some or all of the non-recourse carveout liability obligations of individual guarantors depending on, among other things, the domicile or citizenship of any such guarantor.
The non-recourse carveout provisions contained in certain of the Mortgage Loan documents may also limit the liability of the non-recourse carveout guarantor for certain monetary obligations or covenants related to the use and operation of the Mortgaged Property to the extent that there is sufficient cash flow generated by the Mortgaged Property and made available to the related borrower and/or non-recourse carveout guarantor to take or prevent such required action.
Real Estate and Other Tax Considerations
Below are descriptions of real estate tax matters relating to certain Mortgaged Properties. Certain risks relating to real estate taxes regarding the Mortgaged Properties or the borrowers are described in “Risk Factors—Increases in Real Estate Taxes May Reduce Available Funds” in this prospectus supplement.
With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, representing approximately 4.1% of the Initial Pool Balance, the portion of the property leased to the largest tenant, SSM, qualifies for an exemption of ad valorem real estate taxes because SSM is a non-profit entity. The tax exemption is in effect during the term of the SSM lease and it is the responsibility of the borrower to notify the tax assessor’s office of any changes to the term or occupancy. TheMortgaged Property’s real estate tax liability has been calculated based on the portion of the building not occupied by SSM. If SSM does not maintain its exemption for ad valorem real estate taxes, SSM does not have any right to terminate its lease, and is responsible for payment of its ad valorem real estate taxes under the triple-net structure of its lease.
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Certain Terms of the Mortgage Loans
Due Dates; Mortgage Loan Rates; Calculations of Interest
Subject in some cases to a next business day convention, all of the Mortgage Loans have due dates upon which interest and/or principal payments are due under the related Mortgage Note (each such date, a “Due Date”) that occur as described in the following table with the indicated grace period.
Default Grace | Number of | % of Initial | ||||||
Due Date | Period Days | Mortgage Loans | Pool Balance | |||||
6 | 0 | 43 | 82.4 | % | ||||
6 | 5 | (1) | 1 | 9.9 | ||||
1 | 5 | 6 | 7.7 | |||||
Total | 50 | 100.0 | % |
(1) The Mortgage Loan permits a five-day grace period once during the loan term.
As used in this prospectus supplement, “grace period” is the number of days before a payment default is an event of default under the terms of each Mortgage Loan. See Annex A to this prospectus supplement for information on the number of days before late payment charges are due under the Mortgage Loan. The information on Annex A to this prospectus supplement regarding the number of days before a late payment charge is due is based on the express terms of the Mortgage Loans. Some jurisdictions may impose a statutorily longer period.
All of the Mortgage Loans are secured by first liens on fee simple and/or leasehold interests in the related Mortgaged Properties, subject to the permitted exceptions reflected in the related title insurance policy. All of the Mortgage Loans bear fixed interest rates.
All of the Mortgage Loans accrue interest on the basis of the actual number of days in a month, assuming a 360-day year (”Actual/360 Basis”).
Five (5) of the Mortgage Loans, representing approximately 28.8% of the Initial Pool Balance, provide for monthly payments of interest-only until the related maturity date or Anticipated Repayment Date, as applicable (the “Interest Only Mortgage Loans”).
Each of the remaining 45 Mortgage Loans, representing approximately 71.2%, in the aggregate, of the Initial Pool Balance, provides for monthly payments of principal and interest based on amortization schedules significantly longer than the remaining terms to maturity for such Mortgage Loans (those 45 Mortgage Loans, together with the Interest Only Mortgage Loans, the “Balloon Mortgage Loans”). Twenty-six (26) of these 45 Mortgage Loans referenced in the preceding sentence, representing approximately 40.7%, in the aggregate, of the Initial Pool Balance, provide for monthly payments of interest-only for a period of 12 months to 72 months following the related origination date and then amortize for the remainder of their loan term. The remaining 19 of these 45 Mortgage Loans, representing approximately 30.5%, in the aggregate, of the Initial Pool Balance, amortize for their entire loan term.
Included in such 19 Mortgage Loans is the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, which represents approximately 4.1% of the Initial Pool Balance, that amortizes based on the non-standard amortization schedule set forth on Annex G to this prospectus supplement.
Each Balloon Mortgage Loan will have a balloon payment due at its related maturity date or Anticipated Repayment Date, as applicable, unless prepaid prior thereto.
ARD Loans
The Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as 135 South LaSalle, representing approximately 13.8% of the Initial Pool Balance, is an ARD Loan. An “ARD Loan” is a Mortgage Loan that provides that, after a certain date (an “Anticipated Repayment Date”), if the related
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borrower has not prepaid such Mortgage Loan in full, any principal outstanding on that date will accrue interest at an increased interest rate (the “Revised Rate”) rather than the original Mortgage Loan Rate (the “Initial Rate”) for such Mortgage Loan. Annex A to this prospectus supplement will set forth the Anticipated Repayment Date and the Revised Rate for each ARD Loan (if any). “Excess Interest” with respect to each ARD Loan is the interest accrued at the related Revised Rate in respect of such ARD Loan in excess of the interest accrued at the related Initial Rate (and, to the extent permitted by applicable law and the related Mortgage Loan documents, any compound interest thereon).
After the related Anticipated Repayment Date, each ARD Loan further requires that all cash flow available from the related Mortgaged Property after payment of the monthly debt service payments required under the terms of the related Mortgage Loan documents, all escrows and other amounts then due and payable (other than Excess Interest) under the related Mortgage Loan documents and certain budgeted or non-budgeted expenses approved by the related lender be applied toward the payment of principal (without payment of any yield maintenance premium or other prepayment premium) on such ARD Loan. While interest at the Initial Rate continues to accrue and be payable on a current basis on each ARD Loan after the related Anticipated Repayment Date, the payment of Excess Interest will be deferred and will be required to be paid (if and to the extent permitted under applicable law and the related Mortgage Loan documents), only after the outstanding principal balance of such ARD Loan has been paid in full, at which time the Excess Interest, to the extent actually collected, will be paid to the holders of the Class S Certificates. Additionally, if there are any ARD Loans included in the Issuing Entity, an account was established in connection with the origination of each ARD Loan into which rents or other revenues from the related Mortgaged Property are required to be deposited, although the related borrower is entitled to receive remittances of funds daily unless an event of default or cash flow trigger is in effect or the related Anticipated Repayment Date has occurred.
The foregoing features, to the extent applicable, are designed to increase the likelihood that each ARD Loan will be prepaid by the related borrower on or about its related Anticipated Repayment Date. However, we cannot assure you that the ARD Loan will be prepaid on its Anticipated Repayment Date.
See “Risk Factors—Risks of Anticipated Repayment Date Loans” in this prospectus supplement.
Single-Purpose Entity Covenants
The terms of certain of the Mortgage Loans require that the borrowers be single-purpose entities and, in most cases, such borrowers’ organizational documents or the terms of the Mortgage Loans limit their activities to the ownership of only the related Mortgaged Property or Mortgaged Properties and limit the borrowers’ ability to incur additional indebtedness. Such provisions are designed to mitigate the possibility that the borrower’s financial condition would be adversely impacted by factors unrelated to the related Mortgaged Property and Mortgage Loan. That borrower may also have previously owned property other than the related Mortgaged Property or may be a so-called “recycled” single-purpose entity that previously had other business activities and liabilities. However, in many cases such borrowers are not required to observe all covenants and conditions which typically are required in order for such borrowers to be viewed under standard rating agency criteria as “special purpose entities.”
The organizational documents of a borrower or the direct or indirect managing partner or member of a borrower may also contain requirements that there be one or two independent directors, managers or trustees (depending on the entity form of such borrower) whose vote is required before the borrower files a voluntary bankruptcy or insolvency petition or otherwise institutes insolvency proceedings. Generally, but not always, the independent directors, managers or trustees may only be replaced with certain other independent successors. Although the requirement of having independent directors, managers or trustees is designed to mitigate the risk of a voluntary bankruptcy filing by a solvent borrower, a borrower could file for bankruptcy without obtaining the consent of its independent director(s) (and we cannot assure you that such bankruptcy would be dismissed as an unauthorized filing), and in any case the independent directors, managers or trustees may determine that a bankruptcy filing is an appropriate course of action to be taken by such borrower. Although the independent directors, managers or trustees generally owe no fiduciary duties to entities other than the borrower itself, such determination might take into account the interests and financial condition of such borrower’s parent entities and such parent entities’ other subsidiaries in addition to those of the borrower. Consequently, the financial distress of an affiliate of a borrower might increase the likelihood of a bankruptcy filing by a borrower. In any event, we cannot assure you that a borrower will not file for bankruptcy protection or that creditors of a borrower will not initiate a bankruptcy or similar proceeding against such borrower or that if initiated, a bankruptcy case of the
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borrower could be dismissed. For example, there are certain Mortgage Loans for which there is no independent director, manager or trustee in place with respect to the related borrower.
In all cases, the terms of the borrowers’ organizational documents or the terms of the Mortgage Loans limit the borrower’s activities to the ownership of only the related Mortgaged Property or Mortgaged Properties and related activities, and limit the borrowers’ ability to incur additional indebtedness, other than certain trade debt, equipment financing and other unsecured debt relating to property operations, and other than subordinated debt permitted under the related Mortgage Loan documents. See“—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness” above. Such provisions are designed to mitigate the possibility that the borrower’s financial condition would be adversely impacted by factors unrelated to the related Mortgaged Property and Mortgage Loan. However, we cannot assure you that such borrowers have in the past complied and will comply with such requirements, and in some cases unsecured debt exists and/or is allowed in the future. See “Certain Legal Aspects of the Mortgage Loans—Bankruptcy Issues” in the prospectus.
Prepayment Protections and Certain Involuntary Prepayments
All of the Mortgage Loans have a degree of voluntary prepayment protection in the form of defeasance provisions, prepayment lockout provisions and/or yield maintenance provisions. Voluntary prepayments, if permitted, generally require the payment of a yield maintenance charge or a prepayment premium unless the Mortgage Loan (or Loan Combination, if applicable) is prepaid within a specified period (ranging from approximately 2 to 7 payments) up to and including the related maturity date or Anticipated Repayment Date, as applicable. See Annex A to this prospectus supplement for more information on the prepayment protections attributable to the Mortgage Loans on a loan-by-loan basis.
Additionally, certain Mortgage Loans may provide that in the event of the exercise of a purchase option by a tenant or the sale of real property or the release of a portion of the Mortgaged Property, that the related Mortgage Loans may be prepaid in part prior to the expiration of a prepayment/defeasance lockout provision. See “—Partial Releases” below.
Generally, no yield maintenance charge will be required for prepayments in connection with a casualty or condemnation unless, in the case of most of the Mortgage Loans, an event of default has occurred and is continuing. We cannot assure you that the obligation to pay any yield maintenance charge or prepayment premium will be enforceable. See “Risk Factors—Some Provisions in the Mortgage Loans Underlying Your Offered Certificates May Be Challenged as Being Unenforceable—Prepayment Premiums, Fees and Charges” in the prospectus. In addition, certain of the Mortgage Loans permit the related borrower, after a total or partial casualty or partial condemnation, to prepay the remaining principal balance of the Mortgage Loan (after application of the related insurance proceeds or condemnation award to pay the principal balance of the Mortgage Loan), which may not be accompanied by any prepayment consideration.
Certain of the Mortgage Loans are secured in part by letters of credit and/or cash reserves that in each such case:
· | will be released to the related borrower upon satisfaction by the related borrower of certain performance related conditions, which may include, in some cases, meeting debt service coverage ratio levels and/or satisfying leasing conditions; and |
· | if not so released, may, at the discretion of the lender, prior to loan maturity (or earlier loan default or loan acceleration), be drawn on and/or applied to prepay the subject Mortgage Loan if such performance related conditions are not satisfied within specified time periods. |
See Annex A to this prospectus supplement and“Structural and Collateral Term Sheet” in Annex B to this prospectus supplement for more information on reserves relating to the largest 20 Mortgage Loans.
“Due-On-Sale” and “Due-On-Encumbrance” Provisions
The Mortgage Loans generally contain “due-on-sale” and “due-on-encumbrance” clauses, which in each case permit the holder of the Mortgage Loan to accelerate the maturity of the Mortgage Loan if the borrower sells or otherwise transfers or encumbers (subject to certain exceptions set forth in the related Mortgage Loan
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documents) the related Mortgaged Property or a controlling interest in the borrower without the consent of the mortgagee (which, in some cases, may not be unreasonably withheld). Many of the Mortgage Loans place certain restrictions (subject to certain exceptions set forth in the related Mortgage Loan documents) on the transfer and/or pledging of general partnership and managing member equity interests in a borrower such as specific percentage or control limitations. The terms of the mortgages generally permit, subject to certain limitations, affiliate, estate planning and family transfers, transfers at death, transfers of interest in a public company, the transfer or pledge of less than a controlling portion of the partnership, members’ or other equity interests in a borrower, the transfer or pledge of passive equity interests in a borrower (such as limited partnership interests and non-managing member interests in a limited liability company) and transfers to persons satisfying qualification criteria set forth in the related Mortgage Loan documents. Certain of the Mortgage Loans do not restrict the pledging of direct or indirect ownership interests in the related borrower, but do restrict the transfer of ownership interests in the related borrower by imposing a specific percentage, a control limitation or requiring the consent of the mortgagee to any such transfer. Generally, the Mortgage Loans do not prohibit transfers of non-controlling interests so long as no change of control results or, with respect to Mortgage Loans to tenant-in-common borrowers, transfers to new tenant-in-common borrowers. Certain of the Mortgage Loans do not prohibit the pledge by direct or indirect owners of the related borrower of equity distributions that may be made from time to time by the borrower to its equity owners.
Additionally, certain of the Mortgage Loans provide that transfers of the Mortgaged Property are permitted if certain conditions are satisfied, which may include one or more of the following:
· | no event of default has occurred; |
· | the proposed transferee is creditworthy and has sufficient experience in the ownership and management of properties similar to the Mortgaged Property; |
· | a Rating Agency Confirmation has been obtained from each Rating Agency; |
· | the transferee has executed and delivered an assumption agreement evidencing its agreement to abide by the terms of the Mortgage Loan together with legal opinions and title insurance endorsements; and |
· | the assumption fee has been received (which assumption fee will be applied as described under“Transaction Parties—Servicing Compensation, Operating Advisor Compensation and Payment of Expenses”in this prospectus supplement, but will in no event be paid to the Certificateholders); however, certain of the Mortgage Loans allow the borrower to sell or otherwise transfer the related Mortgaged Property a limited number of times without paying an assumption fee. |
Transfers resulting from the foreclosure of a pledge of the collateral for a mezzanine loan (if any) or other permitted pledge of borrower interest or a preferred equity investment (if any) will also result in a permitted transfer. See “—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness” above.
The Pooling and Servicing Agreement will provide that the Master Servicer (with respect to non-Specially Serviced Loans and with the Special Servicer’s consent) and the Special Servicer (with respect to Specially Serviced Loans) will be required to determine, in a manner consistent with the Servicing Standard, whether to exercise any right the mortgagee may have under any such clause to accelerate payment of the related Serviced Loan upon, or to withhold its consent to, any transfer of interests in the borrower or the Mortgaged Property or further encumbrances of the related Mortgaged Property, subject to any approval rights of the applicable Directing Holder or its representative to any waiver of any such clause. See “Risk Factors—Some Provisions in the Mortgage Loans Underlying Your Offered Certificates May Be Challenged as Being Unenforceable—Due-on-Sale and Debt Acceleration Clauses” and “Certain Legal Aspects of the Mortgage Loans—Due-on-Sale and Due-on-Encumbrance Provisions”in the prospectus. The Depositor makes no representation as to the enforceability of any due-on-sale or due-on-encumbrance provision in any Mortgage Loan.
Notwithstanding the foregoing, without any other approval or consent, the Master Servicer (for non-Specially Serviced Loans) or the Special Servicer (for Specially Serviced Loans) may grant and process a borrower’s request for consent to subject the related Mortgaged Property to an immaterial easement, right of way or similar
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agreement for utilities, access, parking, public improvements or another purpose and may consent to subordination of the related Loan to such easement, right of way or similar agreement.
Defeasance; Collateral Substitution
The terms of 44 of the Mortgage Loans (the “Defeasance Loans”), representing approximately 86.3% of the Initial Pool Balance, permit the applicable borrower at any time (provided, in most cases, that no event of default exists), after a lockout period of at least two years following the Closing Date (or, in the case of a Loan Combination, the earlier of (a) the second anniversary of the securitization of the last note included in such Loan Combination and (b) a specified date no earlier than three years from the date of origination of such Loan Combination) (the “Defeasance Lock Out Period”) and prior to the related open prepayment period described below, to obtain a release of a Mortgaged Property from the lien of the related Mortgage (a “Defeasance Option”) in connection with a defeasance. Certain of those Mortgage Loans also permit the related borrower to make certain voluntary prepayments or effect a partial defeasance in connection with partial releases as described under “—Voluntary Prepayments” and “—Partial Releases” below.
Exercise of a Defeasance Option is also generally conditioned on, among other things, (a) the borrower providing the mortgagee with at least 30 days’ prior written notice of the date on which such defeasance will occur (such date, the “Release Date”), and (b) the borrower (A) paying on any Release Date (i) all accrued and unpaid interest on the principal balance of the Mortgage Loan (or Loan Combination, if applicable) up to and including the Release Date, (ii) all other sums (excluding scheduled interest or principal payments due following the Release Date), due under the Mortgage Loan (or Loan Combination, if applicable) and under all other related Mortgage Loan documents executed in connection with the Defeasance Option, (iii) an amount (the “Defeasance Deposit”) that will be sufficient to (x) purchase non-callable obligations of, or backed by the full faith and credit of, the United States of America or, in certain cases, other “government securities” (within the meaning of Section 2(a)(16) of the Investment Company Act of 1940 and otherwise satisfying REMIC requirements for defeasance collateral), that provide payments (1) on or prior to, but as close as possible to, all successive scheduled due dates occurring during the period from the Release Date to the related maturity date (or to the first day of the open period for such Mortgage Loan (or Loan Combination, if applicable)) and (2) in amounts equal to the scheduled payments due on such due dates under the Mortgage Loan (or Loan Combination, if applicable), or under the defeased portion of the Mortgage Loan (or Loan Combination, if applicable) in the case of a partial defeasance, including in the case of a Balloon Mortgage Loan, the balloon payment, and (y) pay any costs and expenses incurred in connection with the purchase of such government securities, and (B) delivering a security agreement granting the Issuing Entity a first priority lien on the Defeasance Deposit and, in certain cases, the government securities purchased with the Defeasance Deposit and an opinion of counsel to such effect.
Pursuant to the terms of the Pooling and Servicing Agreement, the Master Servicer will be responsible for purchasing (or causing the purchase of) the government securities on behalf of the borrower at the borrower’s expense to the extent consistent with the related Mortgage Loan documents. Pursuant to the terms of the Pooling and Servicing Agreement, any amount in excess of the amount necessary to purchase such government securities will be returned to the borrower or other designated party, but in any event will not be assets of the Issuing Entity. Pursuant to the terms of the Pooling and Servicing Agreement, the Master Servicer may accept as defeasance collateral any “government security,” within the meaning of Treasury Regulations Section 1.860G-2(a)(8)(ii), notwithstanding any more restrictive requirements in the related Mortgage Loan documents;provided that the Master Servicer has received an opinion of counsel that acceptance of such defeasance collateral will not endanger the status of either Trust REMIC as a REMIC or result in the imposition of a tax upon either Trust REMIC or the Issuing Entity (including but not limited to the tax on “prohibited transactions” as defined in Section 860F(a)(2) of the Code and the tax on contributions to a REMIC set forth in Section 860G(d) of the Code, but not including the tax on “net income from foreclosure property” as set forth in Section 860G(c) of the Code). Simultaneously with such actions, the related Mortgaged Property (or applicable portion of the Mortgaged Property, in the case of partial defeasance) will be released from the lien of the Mortgage Loan (or Loan Combination, if applicable) and the pledged government securities (together with any Mortgaged Property not released, in the case of a partial defeasance) will be substituted as the collateral securing the Mortgage Loan (or Loan Combination, if applicable).
For additional information on Mortgage Loans that permit partial defeasance, see “—Partial Releases” below.
In general, if consistent with the related Mortgage Loan documents, a successor borrower established, designated or approved by the Master Servicer will assume the obligations of the related borrower exercising a
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Defeasance Option and the borrower will be relieved of its obligations under the Mortgage Loan. If a Mortgage Loan (or Loan Combination, if applicable) is partially defeased, if consistent with the related Mortgage Loan documents, generally the related promissory note will be split and only the defeased portion of the borrower’s obligations will be transferred to the successor borrower.
Voluntary Prepayments
Six (6) Mortgage Loans, representing approximately 13.7% of the Initial Pool Balance, permit the related borrower, after a lockout period of 11 to 26 payments following the origination date, to prepay the Mortgage Loan in whole or, in some cases, in connection with a partial release of a Mortgaged Property, in part, in each case together with the payment of the greater of a yield maintenance charge and a prepayment premium of 1% of the prepaid amount if such prepayment occurs prior to the related open prepayment period.
In addition to the above-referenced permitted partial prepayments, certain of the Mortgage Loans permit partial defeasance in connection with releases of individual Mortgaged Properties or portions of individual Mortgaged Properties, and certain of the Mortgage Loans that permit defeasance in whole permit partial release with the payment of a release price plus applicable yield maintenance. See “—Partial Releases” below.
Notwithstanding the foregoing restrictions on prepayments, each Mortgage Loan generally permits voluntary prepayments without payment of a yield maintenance charge or any prepayment premium during a limited “open period” immediately prior to and including the maturity date or Anticipated Repayment Date, as applicable, for such Mortgage Loan, as follows:
Prepayment Open Periods
Open Periods | Number of | % of Initial Pool Balance | ||||||||
2 | 1 | 1.7 | % | |||||||
3 | 11 | 13.8 | ||||||||
4 | 32 | 61.5 | ||||||||
5 | 3 | 20.3 | ||||||||
6 | 1 | 0.4 | ||||||||
7 | 2 | 2.4 | ||||||||
Total | 50 | 100.0 | % |
See “Risk Factors—Some Provisions in the Mortgage Loans Underlying Your Offered Certificates May Be Challenged as Being Unenforceable—Prepayment Premiums, Fees and Charges” in the prospectus.
Partial Releases
The Mortgage Loansdescribed below permit the release of one or more of the Mortgaged Properties or a portion of a single Mortgaged Property in connection with a partial prepayment, partial defeasance, or for no consideration in the case of parcels that are vacant, non-income producing or were not taken into account in the underwriting of the Mortgage Loan, subject to the satisfaction of certain specified conditions.
Property Releases; Partial Prepayments
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Promenades Plaza, representing approximately 2.0% of the Initial Pool Balance, the related Mortgage Loan documents permit the release of individual outparcels, identified in the related Mortgage Loan documents as “Release Parcel A” and “Release Parcel B”, subject to the satisfaction of certain conditions, including but not limited to: (i) partial prepayment of the related Mortgage Loan in an amount equal to 125% of (x) with respect to Release Parcel A, $196,500, and (y) with respect to Release Parcel B, $98,250; (ii) payment of the applicable yield maintenance premium; (iii) after giving effect to such release, the debt service coverage ratio is not less than the greater of (x) 1.40x and (y) the debt service coverage ratio as of the date immediately preceding such release; (iv) after giving effect to such release, the loan-to-value ratio is not greater than the lesser of (x) 70% and (y) the loan-to-value ratio as of the date immediately preceding such release; (v) the satisfaction of certain REMIC requirements; and (vi) the lender receives a Rating Agency Confirmation in connection with such release. |
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Property Releases; Partial Defeasance
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Selig Office Portfolio, representing approximately 9.95% of the Initial Pool Balance, provided no event of default is then continuing under the related Mortgage Loan, at any time on or after the first due date following the earlier to occur of the third anniversary of the origination date and the second anniversary of the Closing Date of the securitization into which the last Selig Office Portfolio Companion Loan is deposited, the borrower may obtain the release of one or more of the related Mortgaged Properties from the lien of the Mortgage Loan documents, subject to the satisfaction of certain conditions set forth in the Mortgage Loan documents, including among others: (i) delivery of defeasance collateral in an amount equal to the greater of (x) 90% of net sales proceeds with respect to such Mortgaged Property and (y)(a) in the case of the Mortgaged Properties identified on Annex A to this prospectus supplement as 1000 Second Avenue, 2901 Third Avenue, 300 Elliott Avenue West and 3131 Elliott Avenue, 125% of their respective allocated loan amounts and (b) in the case of the Mortgaged Properties identified on Annex A to this prospectus supplement as 3101 Western Avenue, 2615 Fourth Avenue, 190 Queen Anne Avenue North, 200 First Avenue West and 18 West Mercer Street, 115% of their respective allocated loan amounts; (ii) after giving effect to the release, the debt service coverage ratio (as calculated under the Mortgage Loan documents) for the remaining Mortgaged Properties for the 12-month period preceding the end of the most recent fiscal quarter is no less than the greater of (a) 2.32x and (b) the debt service coverage ratio immediately prior to the release; (iii) delivery of rating agency confirmation (subject to the requirements set forth in the related Outside Servicing Agreement) with respect to such defeasance; and (iv) the borrower delivers a REMIC opinion. |
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Rockside Road Office Portfolio, representing approximately 4.1% of the Initial Pool Balance, provided no event of default is then continuing under the related Mortgage Loan, at any time following the second anniversary of the Closing Date until the maturity of the Mortgage Loan, the related borrower may obtain the release of one or more (but less than all) of the related Mortgaged Properties from the lien of the Mortgage Loan documents, subject to the satisfaction of certain conditions set forth in the Mortgage Loan documents, including, among others: (i) delivery of partial defeasance collateral in amounts equal to or greater than the scheduled defeasance payments relating to the monthly payment dates for the partial defeasance note in the amount of 120% of the allocated loan amount applicable to the release; (ii) that after giving effect to the release, the debt service coverage ratio (as calculated under the Mortgage Loan documents) for the remaining Mortgaged Properties is greater than the greater of (a) 1.75x and (b) the debt service coverage ratio of the Mortgaged Properties subject to the lien of the Mortgage Loan immediately prior to the release; (iii) after giving effect to the release, the debt yield (as calculated under the Mortgage Loan documents) for the remaining Mortgaged Properties is greater than the greater of (a) the debt yield at the origination of the Mortgage Loan and (b) the debt yield with respect to all of the Mortgaged Properties subject to the lien of the Mortgage Loan immediately prior to the release; (iv) after giving effect to the release, the loan-to-value ratio (as calculated under the Mortgage Loan documents) for the remaining Mortgaged Properties is no greater than the lesser of (a) 73% and (b) the loan-to-value ratio of the Mortgaged Properties subject to the lien of the Mortgage Loan immediately prior to the release; (v) delivery of a Rating Agency Confirmation with respect to such partial defeasance; and (vi) such partial release shall be permitted under REMIC requirements and the borrower delivers a REMIC opinion. |
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as NY Seven Self Storage Portfolio, representing approximately 2.8% of the Initial Pool Balance, the related Mortgage Loan documents permit the release of an individual property in connection with a partial defeasance at any time on or after the second anniversary of the Closing Date, and prior to three months prior to the maturity date of the Mortgage Loan, subject to the satisfaction of certain conditions including, but not limited to, (i) defeasance of the related Mortgage Loan in an amount equal to 115% of the allocated loan amount with respect to the released Mortgaged Property; (ii) with respect to the remaining Mortgaged Properties, after giving effect to such release, the debt service coverage ratio is not less than the greater of (a) 1.50x and (b) the debt service coverage ratio as of the date immediately preceding such release; (iii) with respect to the remaining Mortgaged Properties, after giving effect to the release, the |
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loan-to-value ratio is not greater than the lesser of (a) 65% and (b) the loan-to-value ratio as of the date immediately preceding such release; (iv) the delivery of an opinion of counsel that the Issuing Entity will not fail to maintain its status as a REMIC as a result of such release; and (v) the lender receives a Rating Agency Confirmation in connection with such release. |
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Cape May Portfolio, representing approximately 0.8% of the Initial Pool Balance, the related Mortgage Loan documents permit the release of an individual Mortgaged Property in connection with a partial defeasance at any time on or after the second anniversary of the Closing Date, and prior to three months prior to the maturity date of the Mortgage Loan, subject to the satisfaction of certain conditions, including but not limited to: (i) defeasance of the related Mortgage Loan in an amount equal to 115% of the allocated loan amount with respect to the released Mortgaged Property; (ii) that, with respect to the remaining Mortgaged Property after giving effect to the release, the debt service coverage ratio is not less than the greater of (a) 1.65x and (b) the debt service coverage ratio as of the date immediately preceding such release; (iii) that, with respect to the remaining Mortgaged Property after giving effect to the release, the loan-to-value ratio is not greater than the lesser of (a) 60% and (b) the loan-to-value ratio as of the date immediately preceding such release; (iv) the delivery of an opinion of counsel that the Issuing Entity will not fail to maintain its status as a REMIC as a result of the release; and (v) the lender receives a Rating Agency Confirmation in connection with such release. |
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Castroville Industrial Portfolio, representing approximately 0.7% of the Initial Pool Balance, at any time following the second anniversary of the Closing Date, the borrower may obtain the release of the Mortgaged Property identified as 11285 Commercial Parkway from the lien of the Mortgage Loan documents, subject to the satisfaction of certain conditions set forth in the Mortgage Loan documents, including, among others: (i) delivery of defeasance collateral in an amount equal to 115% of its allocated loan amount, (ii) after giving effect to the release, the debt service coverage ratio (as calculated under the Mortgage Loan documents) for the remaining Mortgaged Properties is equal to or greater than the greater of (a) 2.54x and (b) the debt service coverage ratio immediately prior to the release and (iii) the borrower delivers a REMIC opinion. |
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Chester County Multifamily Portfolio, representing approximately 0.7% of the Initial Pool Balance, provided no event of default is then continuing under the related Mortgage Loan, at any time after the expiration of the lockout period, which is the earlier to occur of the third anniversary of the origination date and the date that is two years from the Closing Date, the related borrower may obtain the release of either Mortgaged Property from the lien of the Mortgage Loan documents, subject to the satisfaction of certain conditions set forth in the Mortgage Loan documents, including among others: (i) delivery of defeasance collateral in an amount equal to 125% of such Mortgaged Property’s respective allocated loan amount; (ii) after giving effect to such release, the debt service coverage ratio (as calculated under the Mortgage Loan documents) for the remaining Mortgaged Property for the 12-month period preceding the release is equal to or greater than the greater of (a) the debt service coverage ratio for the 12-month period preceding the origination date of the Mortgage Loan and (b) the debt service coverage ratio immediately prior to the release; (iii) after giving effect to such release, the loan-to-value ratio for the remaining Mortgaged Property is equal to or less than (a) the loan-to-value ratio immediately preceding the origination date of the Mortgage Loan and (b) the loan-to-value ratio for both Mortgaged Properties immediately preceding such release; and (iv) the borrower delivers a REMIC opinion. |
· | With respect to the Mortgage Loan secured by the Mortgaged Properties identified on Annex A to this prospectus supplement as Rite Aid Portfolio, representing approximately 0.5% of the Initial Pool Balance, the Mortgage Loan documents permit the release of an individual Mortgaged Property at any time on or after the second anniversary of the Closing Date until the maturity of the Mortgage Loan, subject to satisfaction of certain conditions, including: (i) partial defeasance of the related Mortgage Loan in the amount of 125% of the allocated loan amount for the Mortgaged Property to be released; (ii) the debt service coverage ratio calculated under the related Mortgage Loan documents for the remaining Mortgaged Properties is greater than the greater of (a) the debt service coverage ratio for all Mortgaged Properties encumbered by the related mortgage(s) securing the Mortgage |
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Loan immediately prior to the release and (b) 1.68x; (iii) the loan-to-value ratio calculated under the related Mortgage Loan documents for the remaining Mortgaged Properties is not greater than the loan-to-value ratio for all Mortgaged Properties encumbered by the related mortgage(s) immediately prior to the release; (iv) the debt yield calculated under the related Mortgage Loan documents for the remaining Mortgaged Properties is greater than the greater of (a) the debt yield for all Mortgaged Properties encumbered by the related mortgage(s) securing the Mortgage Loan immediately prior to the release and (b) the debt yield at origination of the Mortgage Loan; (v) the borrower delivers a REMIC opinion; and (vi) the related borrower delivers a Rating Agency Confirmation. |
Property Releases; Free Releases
· | With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Pasadena Office Tower, representing approximately 5.8% of the Initial Pool Balance, provided no event of default is then continuing under the related Mortgage Loan, after such time as the related borrower has subdivided the parking area of the Mortgaged Property and created a condominium in accordance with the related Mortgage Loan documents, the related borrower has a one-time right to obtain the release of the Airspace Parcel from the lien of the Mortgage Loan in conjunction with the transfer of the Airspace Parcel to an affiliate of the related borrower subject to the satisfaction of certain conditions set forth in the Mortgage Loan documents, including, among others: (i) that either (x) the ratio of the outstanding principal amount of the Mortgage Loan to the value of the Mortgaged Property excluding the Airspace Parcel is equal to or less than 125%, or (y) after giving effect to the release of the Airspace parcel, the LTV ratio does not increase, and (ii) delivery of a REMIC opinion and a Rating Agency Confirmation with respect to such release. |
· | With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as College Village Shopping Center, representing approximately 0.8% of the Initial Pool Balance, the borrower may obtain the release of one outparcel, which parcel is improved with a building occupied by Wendy’s and was not included in the underwriting of the Mortgage Loan (the “Release Parcel”) from the lien of the related Mortgage provided, among other things, (i) no event of default has occurred and is continuing under the related Mortgage Loan documents, (ii) such parcel has been legally subdivided from the Mortgaged Property, (iii) after giving effect to the release, the loan to value ratio is not more than 125%, (iv) if required by the lender, the borrower delivers an opinion of counsel that the Issuing Entity will not fail to maintain its status as a REMIC as a result of the release and (v) if required, the lender receives Rating Agency Confirmation in connection with such release. Additionally, if after the release of a Release Parcel it is determined that the Release Parcel and/or the remaining Mortgaged Property requires additional parking to comply with zoning requirements, the Mortgage Loan documents permit the borrower to demolish a certain identified portion of the Mortgaged Property, which was not included in the underwriting of the Mortgage Loan, to create additional parking, provided that the borrower is required to deposit 125% of the cost of such demolition with lender and deliver a completion guaranty. |
Escrows
Forty-four (44) Mortgage Loans, representing approximately 93.5% of the Initial Pool Balance, provide for monthly or upfront escrows to cover property taxes on the Mortgaged Properties.
Forty-one (41) Mortgage Loans, representing approximately 89.9% of the Initial Pool Balance, provide for monthly or upfront escrows to cover ongoing replacements and capital repairs.
Twenty-one (21) Mortgage Loans, representing approximately 85.0% of that portion of the Initial Pool Balance secured by office, mixed use, retail and industrial properties and one self storage property with office tenants, provide for upfront or monthly escrows for the full term or a portion of the term of the related Mortgage Loan to cover anticipated re-leasing costs, including tenant improvements and leasing commissions or other lease termination or occupancy issues. Such escrows are typically considered for office, mixed use, retail and industrial properties only.
Thirty-seven (37) Mortgage Loans, representing approximately 59.9% of the Initial Pool Balance, provide for monthly or upfront escrows to cover insurance premiums on the Mortgaged Properties.
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Certain of the reserves described above permit the related borrower to post a letter of credit in lieu of maintaining cash reserves.
Many of the Mortgage Loans provide for other escrows and reserves, including, in certain cases, reserves for debt service, operating expenses, renovations or other property enhancements vacancies at the related Mortgaged Property and other shortfalls or reserves to be released under circumstances described in the related Mortgage Loan documents.
Additional Mortgage Loan Information
Each of the tables presented in Annex B and Annex C to this prospectus supplement sets forth selected characteristics of the pool of Mortgage Loans as of the Cut-off Date, if applicable. For a detailed presentation of certain additional characteristics of the Mortgage Loans and the Mortgaged Properties on an individual basis, see Annex A to this prospectus supplement. For certain additional information regarding the 20 largest Mortgage Loans (considering any Crossed Group as a single Mortgage Loan) in the pool of Mortgage Loans, see “Structural and Collateral Term Sheet” in Annex B to this prospectus supplement.
The Loan Combinations
General
Each of the following Split Mortgage Loans is part of a Loan Combination comprised of the subject Mortgage Loan which is included in the Issuing Entity, and one or more Pari Passu Companion Loan(s) and/or Subordinate Companion Loan(s) that are held outside the Issuing Entity, each of which is evidenced by a separate promissory note and all of which are secured by the same Mortgages encumbering the same Mortgaged Property or portfolio of Mortgaged Properties:
· | The Selig Office Portfolio Mortgage Loan, which has an outstanding principal balance as of the Cut-off Date of $72,000,000, is (together with three Selig Office Portfolio Companion Loans) secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Selig Office Portfolio, and represents approximately 9.95% of the Initial Pool Balance. Each of the Selig Office Portfolio Companion Loans ispari passuin right of payment with the Selig Office Portfolio Mortgage Loan. The Selig Office Portfolio Companion Loan that is evidenced by the controlling note A-1 (which has an outstanding principal balance as of the Cut-off Date of $125,000,000) was contributed by GSMC to the CGCMT 2015-GC29 Securitization. The Selig Office Portfolio Companion Loan that is evidenced by the non-controlling note A-2 (which has an outstanding principal balance as of the Cut-off Date of $123,000,000) was contributed by GSMC to the GSMS 2015-GC30 Securitization. The Selig Office Portfolio Companion Loan that is evidenced by the non-controlling note A-4 (which has an outstanding principal balance as of the Cut-off Date of $25,000,000) is currently held by GSMC and is expected to be contributed to one or more future commercial mortgage securitization transactions. The Selig Office Portfolio Loan Combination will be serviced pursuant to the CGCMT 2015-GC29 Pooling and Servicing Agreement. In addition, the related borrower is permitted to obtain up to $51,750,000 of additionalpari passudebt that will be secured by the related Mortgaged Properties. See “—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness” above for more information. Such additional debt will be serviced by the CGCMT 2015-GC29 Servicer as a Selig Office Portfolio Companion Loan in the same manner as each of the other Selig Office Portfolio Companion Loans, subject to certain non-binding consultation rights held by the lender of such additional debt. |
· | The Dallas Market Center Mortgage Loan, which has an outstanding principal balance as of the Cut-off Date of $71,803,978, is (together with two Dallas Market Center Companion Loans) secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Dallas Market Center, and represents approximately 9.9% of the Initial Pool Balance. Each of the Dallas Market Center Companion Loans ispari passu in right of payment with the Dallas Market Center Mortgage Loan. The Dallas Market Center Companion Loan that is evidenced by the controlling note A-1 (which has an outstanding principal balance as of the Cut-off Date of $129,646,071) was contributed by GSMC to the GSMS 2015-GC30 Securitization. The Dallas Market Center Companion Loan that is evidenced by the non-controlling note A-3 (which has an outstanding principal balance as of the Cut-off Date of $56,844,816) is currently held by GSMC and is expected to be contributed to one or |
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more future commercial mortgage securitization transactions. The Dallas Market Center Loan Combination will be serviced pursuant to the GSMS 2015-GC30 Pooling and Servicing Agreement. |
· | The Crowne Plaza Bloomington Mortgage Loan, which has an outstanding principal balance as of the Cut-off Date of $12,170,872, is (together with the Crowne Plaza Bloomington Companion Loan) secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Crowne Plaza Bloomington, and represents approximately 1.7% of the Initial Pool Balance. The Crowne Plaza Bloomington Companion Loan isparipassu in right of payment with the Crowne Plaza Bloomington Mortgage Loan. The Crowne Plaza Bloomington Companion Loan has an outstanding principal balance as of the Cut-off Date of $13,909,568. The Crowne Plaza Bloomington Companion Loan (which is evidenced by the controlling note A-1) was contributed by CGMRC to the CGCMT 2015-GC29 Securitization. The Crowne Plaza Bloomington Loan Combination will be serviced pursuant to the CGCMT 2015-GC29 Pooling and Servicing Agreement. |
Each Split Mortgage Loan and its related Companion Loan(s) are cross-collateralized and cross-defaulted. Each Pari Passu Companion Loan ispari passu in right of payment with its related Split Mortgage Loan. Each Subordinate Companion Loan is subordinate in right of payment to the related Split Mortgage Loan. Only each Split Mortgage Loan is included in the Issuing Entity. No Companion Loan is an asset of the Issuing Entity.
Set forth in the chart below is certain information regarding each Split Mortgage Loan and its related Companion Loan(s).
Loan Combination Summary | ||||||||||||||||
Mortgaged | Mortgage | % of | Pari Passu | Subordinate | Loan | Controlling | Master | Special | ||||||||
Selig Office Portfolio | $72,000,000 | 9.95% | $273,000,000(1) | N/A | $345,000,000 | CGCMT 2015-GC29 | Midland Loan Services, a Division of PNC Bank, National Association | Midland Loan Services, a Division of PNC Bank, National Association | ||||||||
Dallas Market Center | $71,803,978 | 9.9% | $186,490,887(2) | N/A | $258,294,865 | GSMS 2015-GC30 | Midland Loan Services, a Division of PNC Bank, National Association | Midland Loan Services, a Division of PNC Bank, National Association | ||||||||
Crowne Plaza Bloomington | $12,170,872 | 1.7% | $13,909,568 | N/A | $26,080,440 | CGCMT 2015-GC29 | Midland Loan Services, a Division of PNC Bank, National Association | Midland Loan Services, a Division of PNC Bank, National Association |
(1) | The Selig Office Portfolio Companion Loans are currently comprised of the controlling note A-1, with an outstanding principal balance as of the Cut-off Date of $125,000,000, the non-controlling note A-2, with an outstanding principal balance as of the Cut-off Date of $123,000,000, and the non-controlling note A-4, with an outstanding principal balance as of the Cut-off Date of $25,000,000. In addition, the borrower is permitted to obtain up to $51,750,000 of additional pari passu debt that will be secured by the Mortgaged Property. See “—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness” above for more information. Such additional debt will be serviced by the CGCMT 2015-GC29 Servicer as a Selig Office Portfolio Companion Loan in the same manner as each other Selig Office Portfolio Companion Loan, subject to certain non-binding consultation rights held by the lender of such additional debt. |
(2) | The Dallas Market Center Companion Loans are currently comprised of the controlling note A-1, with an outstanding principal balance as of the Cut-off Date of $129,646,071, and the non-controlling note A-3, with an outstanding principal balance as of the Cut-off Date of $56,844,816. |
In connection with each Loan Combination, the relative rights and obligations of the Trustee on behalf of the Issuing Entity and each related Companion Loan Holder are generally governed by a co-lender agreement, intercreditor agreement, agreement among noteholders or comparable agreement (each, a “Co-Lender Agreement”). Each Co-Lender Agreement provides, among other things, that (i) one of the holders will be the “controlling note holder” (the “Controlling Note Holder”) entitled to (a) approve or, in some cases, direct material servicing decisions involving the related Loan Combination, and (b) in some cases, replace the applicable special servicer with respect to such Loan Combination with or without cause; (ii) for the servicing and administration of the subject Loan Combination and any related Mortgaged Property; and (iii) that expenses, losses and shortfalls relating to the Loan Combination will be allocatedfirst to any related Subordinate Companion Loan (if any), and
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then, on a pro rata basis to the holders of the subject Mortgage Loan and any related Pari Passu Companion Loan(s) (if any), in each case as more particularly described below in this “—The Loan Combinations” section.
Set forth below are certain terms and provisions of each Loan Combination and the related Co-Lender Agreement. For more information regarding the servicing of the Outside Serviced Mortgage Loans, see “The Pooling and Servicing Agreement—Certain Considerations Regarding the Outside Serviced Loan Combinations” and “—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement. Also, see “Structural and Collateral Term Sheet—Selig Office Portfolio” and “—Dallas Market Center” in Annex B to this prospectus supplement.
The Selig Office Portfolio Loan Combination
Servicing
The Selig Office Portfolio Loan Combination and any related REO Property will be serviced and administered in accordance with the CGCMT 2015-GC29 Pooling and Servicing Agreement, dated as of April 1, 2015, among Citigroup Commercial Mortgage Securities Inc., as depositor, Situs Holdings, LLC, as operating advisor (the “CGCMT 2015-GC29 Operating Advisor”), Midland Loan Services, a Division of PNC Bank, National Association, as CGCMT 2015-GC29 Servicer and as CGCMT 2015-GC29 Special Servicer, Citibank, N.A., as certificate administrator (in such capacity, the “CGCMT 2015-GC29 Certificate Administrator”), and Deutsche Bank Trust Company Americas, as CGCMT 2015-GC29 Trustee, which is separate from the Pooling and Servicing Agreement under which your Certificates are issued, by the CGCMT 2015-GC29 Servicer and the CGCMT 2015-GC29 Special Servicer, in the manner described under ”The Pooling and Servicing Agreement—Certain Considerations Regarding the Outside Serviced Loan Combinations” and ”—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement, but subject to the terms of the related Co-Lender Agreement. In servicing the Selig Office Portfolio Loan Combination, the servicing standard set forth in the CGCMT 2015-GC29 Pooling and Servicing Agreement will require the CGCMT 2015-GC29 Servicer and the CGCMT 2015-GC29 Special Servicer to take into account the interests of the Certificateholders and the holders of the Selig Office Portfolio Companion Loans as a collective whole.
Amounts payable to the Issuing Entity as holder of the Selig Office Portfolio Mortgage Loan pursuant to the related Co-Lender Agreement will be included in the Available Funds for the related Distribution Date to the extent described in this prospectus supplement net of certain fees and expenses as set forth in the related Co-Lender Agreement.
In addition, the borrower is permitted to obtain up to $51,750,000 of additional pari passu debt that will be secured by the related portfolio of Mortgaged Properties. See “—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness” above for more information. Such additional debt will be serviced by the CGCMT 2015-GC29 Servicer as a Selig Office Portfolio Companion Loan in the same manner as each other Selig Office Portfolio Companion Loan, subject to certain non-binding consultation rights held by the lender of such additional debt.
Application of Payments
The related Co-Lender Agreement sets forth the respective rights of the holder of the Selig Office Portfolio Mortgage Loan and the holders of the Selig Office Portfolio Companion Loans with respect to distributions of funds received in respect of the Selig Office Portfolio Loan Combination, and provides, in general, that:
· | the Selig Office Portfolio Mortgage Loan and the Selig Office Portfolio Companion Loans are of equal priority with each other and no portion of either of them will have priority or preference over any portion of the other or security therefor; |
· | all payments, proceeds and other recoveries on or in respect of the Selig Office Portfolio Loan Combination or the related Mortgaged Property will be applied to the Selig Office Portfolio Mortgage Loan and the Selig Office Portfolio Companion Loans on apro rataandpari passu basis according to their respective outstanding principal balances (subject, in each case, to the payment and reimbursement rights of the CGCMT 2015-GC29 Servicer, the CGCMT 2015-GC29 Special Servicer, the CGCMT 2015-GC29 Operating Advisor, the CGCMT 2015-GC29 Certificate Administrator and the |
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CGCMT 2015-GC29 Trustee) in accordance with the terms of the related Co-Lender Agreement and the CGCMT 2015-GC29 Pooling and Servicing Agreement; and |
· | expenses, losses and shortfalls relating to the Selig Office Portfolio Loan Combination will, in general, be allocated, on apro rata andpari passu basis, to the Selig Office Portfolio Mortgage Loan and the Selig Office Portfolio Companion Loans. |
Notwithstanding the foregoing, if a P&I Advance is made with respect to the Selig Office Portfolio Mortgage Loan, then that P&I Advance, together with interest thereon, may only be reimbursed out of future payments and collections on the Selig Office Portfolio Mortgage Loan or, as and to the extent described under “The Pooling and Servicing Agreement—Advances” in this prospectus supplement, on other Mortgage Loans, but not out of payments or other collections on the Selig Office Portfolio Companion Loans. Similarly, P&I advances on the Selig Office Portfolio Companion Loans are not reimbursable out of payments or other collections on the Selig Office Portfolio Mortgage Loan.
Certain costs, losses, liabilities, claims and expenses (such as a pro rata share of a property protection advance) allocable to the Selig Office Portfolio Mortgage Loan may be paid or reimbursed out of payments and other collections on the mortgage loans in the CGCMT 2015-GC29 Securitization, subject to the CGCMT 2015-GC29 Issuing Entity’s right to reimbursement from future payments and other collections on the Selig Office Portfolio Mortgage Loan or from general collections on the Mortgage Pool.
Consultation and Control
Pursuant to the related Co-Lender Agreement, the directing holder with respect to the Selig Office Portfolio Loan Combination, as of any date of determination, will be the CGCMT 2015-GC29 Trustee on behalf of the CGCMT 2015-GC29 Issuing Entity as holder of the controlling Selig Office Portfolio Companion Loan;provided, that, unless a control termination event exists under the CGCMT 2015-GC29 Pooling and Servicing Agreement, the CGCMT 2015-GC29 Controlling Class Representative will be entitled to exercise the rights of the directing holder with respect to the Selig Office Portfolio Loan Combination. In its capacity as representative of the directing holder under the related Co-Lender Agreement, the CGCMT 2015-GC29 Controlling Class Representative will be entitled to exercise consent and/or consultation rights (which consent and/or consultation rights are substantially similar to, but not necessarily identical to the rights of the Controlling Class Representative set forth under “The Pooling and Servicing Agreement—Directing Holder” in this prospectus supplement) with respect to any “major decisions” (as defined under the related Co-Lender Agreement) to be taken with respect to the Selig Office Portfolio Loan Combination, and the implementation of any recommended actions outlined in an asset status report with respect to the Selig Office Portfolio Loan Combination will require the approval of the CGCMT 2015-GC29 Controlling Class Representative (which approval rights are substantially similar to, but not necessarily identical to, those rights described in this prospectus supplement under “The Pooling and Servicing Agreement—Directing Holder” and “—Asset Status Reports”). Pursuant to the terms of the CGCMT 2015-GC29 Pooling and Servicing Agreement, the CGCMT 2015-GC29 Controlling Class Representative will have the same consent and/or consultation rights with respect to the Selig Office Portfolio Loan Combination as it does, and for so long as it does, with respect to the other mortgage loans included in the CGCMT 2015-GC29 Issuing Entity and serviced under the CGCMT 2015-GC29 Pooling and Servicing Agreement.
In addition, pursuant to the terms of the related Co-Lender Agreement, the Issuing Entity, as holder of the Selig Office Portfolio Mortgage Loan (or its representative, which, until a Consultation Termination Event occurs, will be the Controlling Class Representative) will (i) have a right to receive copies of all notices, information and reports that the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer, as applicable, is required to provide to the CGCMT 2015-GC29 Controlling Class Representative (within the same time frame such notices, information and reports are or would have been required to be provided to the CGCMT 2015-GC29 Controlling Class Representative under the CGCMT 2015-GC29 Pooling and Servicing Agreement without regard to the occurrence of a control termination event or consultation termination event under the CGCMT 2015-GC29 Pooling and Servicing Agreement) with respect to any “major decisions” (as defined under the related Co-Lender Agreement) to be taken with respect to the Selig Office Portfolio Loan Combination or the implementation of any recommended action outlined in an asset status report relating to the Selig Office Portfolio Loan Combination and (ii) have the right to be consulted on a strictly non-binding basis with respect to any “major decisions” (as defined under the related Co-Lender Agreement) to be taken with respect to the Selig Office Portfolio Loan Combination or the implementation of any recommended action outlined in an asset status report relating to the Selig Office Portfolio Loan Combination. The consultation right of the Issuing Entity (or its representative) will expire 10
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business days following the delivery of notice and information relating to the matter subject to consultation whether or not the Issuing Entity (or its representative) has responded within such period; provided, that if the CGCMT 2015-GC29 Servicer (or the CGCMT 2015-GC29 Special Servicer, as applicable) proposes a new course of action that is materially different from the actions previously proposed, the 10 business-day consultation period will be deemed to begin anew. Notwithstanding the consultation rights described above, the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer, as applicable, is permitted to take any material action or any action set forth in the asset status report before the expiration of the aforementioned 10 business-day period if it determines that immediate action with respect to such decision is necessary to protect the interests of the holders of the Selig Office Portfolio Loan Combination. Neither the CGCMT 2015-GC29 Servicer nor the CGCMT 2015-GC29 Special Servicer will be obligated at any time to follow or take any alternative actions recommended by the Issuing Entity (or its representative).
Similarly, such rights as described in the paragraph above are held by the GSMS 2015-GC30 Issuing Entity, as holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-2 (or its representative) and by the holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-4 (or its representative).
Neither the CGCMT 2015-GC29 Servicer nor the CGCMT 2015-GC29 Special Servicer may take or refrain from taking any action based on advice or consultation provided by the Issuing Entity (or its representative), the GSMS 2015-GC30 Issuing Entity, as holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-2 (or its representative), or the holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-4 (or its representative), that would cause the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer, as applicable, to violate applicable law, the terms of the Selig Office Portfolio Loan Combination, the related Co-Lender Agreement, the CGCMT 2015-GC29 Pooling and Servicing Agreement, including the servicing standard under the CGCMT 2015-GC29 Pooling and Servicing Agreement, or the REMIC provisions or that would (i) expose the CGCMT 2015-GC29 Servicer, the CGCMT 2015-GC29 Special Servicer, the CGCMT 2015-GC29 depositor, a mortgage loan seller with respect to the CGCMT 2015-GC29 Securitization, the CGCMT 2015-GC29 Issuing Entity, the CGCMT 2015-GC29 Trustee, the CGCMT 2015-GC29 Operating Advisor, the CGCMT 2015-GC29 Certificate Administrator or their respective affiliates, officers, directors, employees or agents to any claim, suit or liability, (ii) materially expand the scope of the CGCMT 2015-GC29 Servicer’s or the CGCMT 2015-GC29 Special Servicer’s responsibilities, or (iii) cause the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer to act, or fail to act, in a manner that is not in the best interests of the CGCMT 2015-GC29 certificateholders.
In addition to the consultation rights of the Issuing Entity (or its representative) described above, pursuant to the terms of the related Co-Lender Agreement, the Issuing Entity (or its representative) will have the right to attend (in-person or telephonic) annual meetings with the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer, as applicable, upon reasonable notice and at times reasonably acceptable to the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer, as applicable, for the purpose of discussing servicing issues related to the Selig Office Portfolio Loan Combination. See “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
Application of Penalty Charges
The related Co-Lender Agreement provides that items in the nature of penalty charges paid on the Selig Office Portfolio Loan Combination will first, be used to reduce, on a pro rata basis, the amounts payable on each of the Selig Office Portfolio Mortgage Loan and the Selig Office Portfolio Companion Loans by the amount necessary to reimburse the CGCMT 2015-GC29 Servicer, the CGCMT 2015-GC29 Trustee or the CGCMT 2015-GC29 Special Servicer for any interest accrued on any property protection advances and reimbursement of any property protection advances in accordance with the terms of the CGCMT 2015-GC29 Pooling and Servicing Agreement, second, be used to reduce the respective amounts payable on each of the Selig Office Portfolio Mortgage Loan and the Selig Office Portfolio Companion Loans by the amount necessary to pay the Master Servicer, the Trustee, the CGCMT 2015-GC29 Servicer, the CGCMT 2015-GC29 Trustee, the GSMS 2015-GC30 Servicer and the GSMS 2015-GC30 Trustee for any interest accrued on any P&I Advance (or analogous P&I advance made pursuant to the CGCMT 2015-GC29 Pooling and Servicing Agreement or the GSMS 2015-GC30 Pooling and Servicing Agreement, as applicable) made with respect to such loan by such party (if and as specified in the Pooling and Servicing Agreement, the CGCMT 2015-GC29 Pooling and Servicing Agreement or the GSMS 2015-GC30 Pooling and Servicing Agreement, as applicable), third, be used to reduce, on a pro rata basis, the amounts payable on each of the Selig Office Portfolio Mortgage Loan and the Selig Office Portfolio
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Companion Loans by the amount necessary to pay additional trust fund expenses (other than special servicing fees, unpaid workout fees and liquidation fees, each as payable under the CGCMT 2015-GC29 Pooling and Servicing Agreement) incurred with respect to the Selig Office Portfolio Loan Combination (as specified in the CGCMT 2015-GC29 Pooling and Servicing Agreement) and, finally, in the case of the remaining amount of penalty charges allocable to the Selig Office Portfolio Mortgage Loan and the Selig Office Portfolio Companion Loans, be paid to the CGCMT 2015-GC29 Servicer and/or the CGCMT 2015-GC29 Special Servicer as additional servicing compensation as provided in the CGCMT 2015-GC29 Pooling and Servicing Agreement.
Sale of Defaulted Loan Combination
Pursuant to the terms of the related Co-Lender Agreement, if the Selig Office Portfolio Loan Combination becomes a defaulted mortgage loan under the CGCMT 2015-GC29 Pooling and Servicing Agreement, and if the CGCMT 2015-GC29 Special Servicer determines to sell the controlling Selig Office Portfolio Companion Loan in accordance with the CGCMT 2015-GC29 Pooling and Servicing Agreement, then the CGCMT 2015-GC29 Special Servicer will be required to sell all the Selig Office Portfolio Companion Loans together with the Selig Office Portfolio Mortgage Loan (as well as any note related to Additional Permitted Debt) as one whole loan in accordance with procedures generally similar to those set forth under “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties” in this prospectus supplement. See “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
Notwithstanding the foregoing, the CGCMT 2015-GC29 Special Servicer will not be permitted to sell the Selig Office Portfolio Loan Combination if it becomes a defaulted mortgage loan under the CGCMT 2015-GC29 Pooling and Servicing Agreement without the written consent of the Issuing Entity (or its representative), as holder of the Selig Office Portfolio Mortgage Loan, the GSMS 2015-GC30 Issuing Entity, as holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-2 (or its representative) and the holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-4 (or its representative) (as well as the holder of any note related to Additional Permitted Debt) unless the CGCMT 2015-GC29 Special Servicer has delivered to such holders (or their representatives): (a) at least 15 business days’ prior written notice of any decision to attempt to sell the Selig Office Portfolio Loan Combination; (b) at least 10 days prior to the proposed sale date, a copy of each bid package (together with any material amendments to such bid packages) received by the CGCMT 2015-GC29 Special Servicer in connection with any such proposed sale; (c) at least 10 days prior to the proposed sale date, a copy of the most recent appraisal for the Selig Office Portfolio Loan Combination, and any documents in the servicing file reasonably requested by the Issuing Entity (or its representative) that are material to the price of the Selig Office Portfolio Loan Combination; and (d) until the sale is completed, and a reasonable period of time (but no less time than is afforded to other offerors and the CGCMT 2015-GC29 Controlling Class Representative) prior to the proposed sale date, all information and other documents being provided to other offerors and all leases or other documents that are approved by the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer in connection with the proposed sale;provided, that the Issuing Entity (or its representative), the GSMS 2015-GC30 Issuing Entity, as holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-2 (or its representative) or the holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-4 (or its representative) (as well as the holder of any note related to Additional Permitted Debt) may waive as to itself any of the delivery or timing requirements set forth in this sentence. The Issuing Entity (or its representative), the GSMS 2015-GC30 Issuing Entity, as holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-2 (or its representative) or the holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-4 (or its representative) will be permitted to bid at any sale of the Selig Office Portfolio Loan Combination.
See “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties” in this prospectus supplement.
Special Servicer Appointment Rights
Pursuant to the related Co-Lender Agreement, the directing holder with respect to the Selig Office Portfolio Loan Combination (which, as of any date of determination, will be the CGCMT 2015-GC29 Trustee on behalf of the CGCMT 2015-GC29 Issuing Entity, as holder of the controlling Selig Office Portfolio Companion Loan, or its representative which, prior to a control termination event under the CGCMT 2015-GC29 Pooling and Servicing Agreement, will be the CGCMT 2015-GC29 Controlling Class Representative) will have the right, with or without cause, to replace the CGCMT 2015-GC29 Special Servicer then acting with respect to the Selig Office Portfolio
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Loan Combination and appoint a replacement special servicer in lieu thereof without the consent of the Issuing Entity (or its representative), the GSMS 2015-GC30 Issuing Entity, as holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-2 (or its representative), or the holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-4 (or its representative) (or the holder of any note related to Additional Permitted Debt). The applicable CGCMT 2015-GC29 certificateholders with the requisite percentage of voting rights (after a control termination event under the CGCMT 2015-GC29 Pooling and Servicing Agreement) will have the right, with or without cause, to replace the CGCMT 2015-GC29 Special Servicer then acting with respect to the Selig Office Portfolio Loan Combination and appoint a replacement special servicer in lieu thereof without the consent of the Issuing Entity (or its representative), the GSMS 2015-GC30 Issuing Entity, as holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-2 (or its representative), or the holder of the Selig Office Portfolio Companion Loan evidenced by the non-controlling note A-4 (or its representative) (or the holder of any note related to Additional Permitted Debt) in accordance with the CGCMT 2015-GC29 Pooling and Servicing Agreement, as described under “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
The Dallas Market Center Loan Combination
Servicing
The Dallas Market Center Loan Combination and any related REO Property will be serviced and administered pursuant to the GSMS 2015-GC30 Pooling and Servicing Agreement, dated as of May 1, 2015, among GS Mortgage Securities Corporation II, as depositor, Trimont Real Estate Advisors, Inc., as operating advisor (the “GSMS 2015-GC30 Operating Advisor”), Midland Loan Services, a Division of PNC Bank, National Association, as GSMS 2015-GC30 Servicer and as GSMS 2015-GC30 Special Servicer, U.S. Bank National Association, as certificate administrator (in such capacity, the “GSMS 2015-GC30 Certificate Administrator”) and as the GSMS 2015-GC30 Trustee, which is separate from the Pooling and Servicing Agreement under which your Certificates are issued, by the GSMS 2015-GC30 Servicer and the GSMS 2015-GC30 Special Servicer, in the manner described under “The Pooling and Servicing Agreement—Certain Considerations Regarding the Outside Serviced Loan Combinations” and “—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement, but subject to the terms of the related Co-Lender Agreement. In servicing the Dallas Market Center Loan Combination, the servicing standard set forth in the GSMS 2015-GC30 Pooling and Servicing Agreement will require the GSMS 2015-GC30 Servicer and the GSMS 2015-GC30 Special Servicer to take into account the interests of both the Certificateholders and the holders of the Dallas Market Center Companion Loans as a collective whole.
Amounts payable to the Issuing Entity as holder of the Dallas Market Center Mortgage Loan pursuant to the related Co-Lender Agreement will be included in the Available Funds for the related Distribution Date to the extent described in this prospectus supplement net of certain fees and expenses as set forth in the related Co-Lender Agreement.
Application of Payments
The related Co-Lender Agreement sets forth the respective rights of the holder of the Dallas Market Center Mortgage Loan and the holders of the Dallas Market Center Companion Loans with respect to distributions of funds received in respect of the Dallas Market Center Loan Combination, and provides, in general, that:
· | the Dallas Market Center Mortgage Loan and the Dallas Market Center Companion Loans are of equal priority with each other and no portion of either of them will have priority or preference over any portion of the other or security therefor; |
· | all payments, proceeds and other recoveries on or in respect of the Dallas Market Center Loan Combination or the related Mortgaged Property will be applied to the Dallas Market Center Mortgage Loan and the Dallas Market Center Companion Loans on apro rata andpari passu basis according to their respective outstanding principal balances (subject, in each case, to the payment and reimbursement rights of the GSMS 2015-GC30 Servicer, the GSMS 2015-GC30 Special Servicer, the GSMS 2015-GC30 Operating Advisor, the GSMS 2015-GC30 Certificate Administrator and the GSMS 2015-GC30 Trustee) in accordance with the terms of the related Co-Lender Agreement and the GSMS 2015-GC30 Pooling and Servicing Agreement; and |
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· | expenses, losses and shortfalls relating to the Dallas Market Center Loan Combination will be allocated, on apro rata andpari passu basis, to the Dallas Market Center Mortgage Loan and the Dallas Market Center Companion Loans. |
Notwithstanding the foregoing, if a P&I Advance is made with respect to the Dallas Market Center Mortgage Loan, then that P&I Advance, together with interest thereon, may only be reimbursed out of future payments and collections on the Dallas Market Center Mortgage Loan or, as and to the extent described under “The Pooling and Servicing Agreement—Advances” in this prospectus supplement, on other Mortgage Loans, but not out of payments or other collections on the Dallas Market Center Companion Loans. Similarly, P&I advances on the Dallas Market Center Companion Loans are not reimbursable out of payments or other collections on the Dallas Market Center Mortgage Loan.
Certain costs, losses, liabilities, claims and expenses (such as a pro rata share of a property protection advance) allocable to the Dallas Market Center Mortgage Loan may be paid or reimbursed out of payments and other collections on the mortgage loans in the GSMS 2015-GC30 Securitization, subject to the GSMS 2015-GC30 Issuing Entity’s right to reimbursement from future payments and other collections on the Dallas Market Center Mortgage Loan or from general collections on the Mortgage Pool.
Consultation and Control
Pursuant to the related Co-Lender Agreement, the directing holder with respect to the Dallas Market Center Loan Combination, as of any date of determination, will be the GSMS 2015-GC30 Trustee on behalf of the GSMS 2015-GC30 Issuing Entity as holder of the controlling Dallas Market Center Companion Loan;provided, that, unless a control termination event exists under the GSMS 2015-GC30 Pooling and Servicing Agreement, the GSMS 2015-GC30 Controlling Class Representative will be entitled to exercise the rights of the directing holder with respect to the Dallas Market Center Loan Combination. In its capacity as representative of the directing holder under the related Co-Lender Agreement, the GSMS 2015-GC30 Controlling Class Representative will be entitled to exercise consent and/or consultation rights (which consent and/or consultation rights are substantially similar to, but not necessarily identical to the rights of the Controlling Class Representative set forth under “The Pooling and Servicing Agreement—Directing Holder” in this prospectus supplement) with respect to any “major decisions” (as defined under the related Co-Lender Agreement) to be taken with respect to the Dallas Market Center Loan Combination, and the implementation of any recommended actions outlined in an asset status report with respect to the Dallas Market Center Loan Combination will require the approval of the GSMS 2015-GC30 Controlling Class Representative (which approval rights are substantially similar to, but not necessarily identical to, those rights described in this prospectus supplement under “The Pooling and Servicing Agreement—Directing Holder” and “—Asset Status Reports”). Pursuant to the terms of the GSMS 2015-GC30 Pooling and Servicing Agreement, the GSMS 2015-GC30 Controlling Class Representative will have the same consent and/or consultation rights with respect to the Dallas Market Center Loan Combination as it does, and for so long as it does, with respect to the other mortgage loans included in the GSMS 2015-GC30 Issuing Entity and serviced under the GSMS 2015-GC30 Pooling and Servicing Agreement.
In addition, pursuant to the terms of the related Co-Lender Agreement, the Issuing Entity, as holder of the Dallas Market Center Mortgage Loan (or its representative, which, until a Consultation Termination Event occurs, will be the Controlling Class Representative) will (i) have a right to receive copies of all notices, information and reports that the GSMS 2015-GC30 Servicer or the GSMS 2015-GC30 Special Servicer, as applicable, is required to provide to the GSMS 2015-GC30 Controlling Class Representative (within the same time frame such notices, information and reports are or would have been required to be provided to the GSMS 2015-GC30 Controlling Class Representative under the GSMS 2015-GC30 Pooling and Servicing Agreement without regard to the occurrence of a control termination event or consultation termination event under the GSMS 2015-GC30 Pooling and Servicing Agreement) with respect to any “major decisions” (as defined under the related Co-Lender Agreement) to be taken with respect to the Dallas Market Center Loan Combination or the implementation of any recommended action outlined in an asset status report relating to the Dallas Market Center Loan Combination and (ii) have the right to be consulted on a strictly non-binding basis with respect to any “major decisions” (as defined under the related Co-Lender Agreement) to be taken with respect to the Dallas Market Center Loan Combination or the implementation of any recommended action outlined in an asset status report relating to the Dallas Market Center Loan Combination. The consultation right of the Issuing Entity (or its representative) will expire 10 business days following the delivery of notice and information relating to the matter subject to consultation whether or not the Issuing Entity (or its representative) has responded within such period; provided, that if the GSMS 2015-GC30 Servicer (or the GSMS 2015-GC30 Special Servicer, as applicable) proposes a new
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course of action that is materially different from the actions previously proposed, the 10 business-day consultation period will be deemed to begin anew. Notwithstanding the Issuing Entity’s (or its representative’s) consultation rights described above, the GSMS 2015-GC30 Servicer or the GSMS 2015-GC30 Special Servicer, as applicable, is permitted to take any material action or any action set forth in the asset status report before the expiration of the aforementioned 10 business-day period if it determines that immediate action with respect to such decision is necessary to protect the interests of the holders of the Dallas Market Center Loan Combination. Neither the GSMS 2015-GC30 Servicer nor the GSMS 2015-GC30 Special Servicer will be obligated at any time to follow or take any alternative actions recommended by the Issuing Entity (or its representative).
Similarly, such rights as described in the paragraph above are held by the holder of the non-controlling note A-3 (or its representative).
Neither the GSMS 2015-GC30 Servicer nor the GSMS 2015-GC30 Special Servicer may take or refrain from taking any action based on advice or consultation provided by the Issuing Entity (or its representative) or the holder of the Dallas Market Center Companion Loan evidenced by the non-controlling note A-3 (or its representative) that would cause the GSMS 2015-GC30 Servicer or the GSMS 2015-GC30 Special Servicer, as applicable, to violate applicable law, the terms of the Dallas Market Center Loan Combination, the related Co-Lender Agreement, the GSMS 2015-GC30 Pooling and Servicing Agreement, including the servicing standard under the GSMS 2015-GC30 Pooling and Servicing Agreement, or the REMIC provisions or that would (i) expose the GSMS 2015-GC30 Servicer, the GSMS 2015-GC30 Special Servicer, the GSMS 2015-GC30 depositor, a mortgage loan seller with respect to the GSMS 2015-GC30 Securitization, the GSMS 2015-GC30 Issuing Entity, the GSMS 2015-GC30 Trustee, the GSMS 2015-GC30 Operating Advisor, the GSMS 2015-GC30 Certificate Administrator or their respective affiliates, officers, directors, employees or agents to any claim, suit or liability, (ii) materially expand the scope of the GSMS 2015-GC30 Servicer’s or the GSMS 2015-GC30 Special Servicer’s responsibilities, or (iii) cause the GSMS 2015-GC30 Servicer or the GSMS 2015-GC30 Special Servicer to act, or fail to act, in a manner that is not in the best interests of the GSMS 2015-GC30 certificateholders or the servicing standard under the GSMS 2015-GC30 Pooling and Servicing Agreement.
In addition to the consultation rights of the Issuing Entity (or its representative) described above, pursuant to the terms of the related Co-Lender Agreement, the Issuing Entity (or its representative) will have the right to attend (in-person or telephonic) annual meetings with the GSMS 2015-GC30 Servicer or the GSMS 2015-GC30 Special Servicer, as applicable, upon reasonable notice and at times reasonably acceptable to the GSMS 2015-GC30 Servicer or the GSMS 2015-GC30 Special Servicer, as applicable, for the purpose of discussing servicing issues related to the Dallas Market Center Loan Combination.
Application of Penalty Charges
The related Co-Lender Agreement provides that penalty charges paid on the Dallas Market Center Loan Combination will first, be used to reduce, on a pro rata basis, the amounts payable on each of the Dallas Market Center Mortgage Loan and the Dallas Market Center Companion Loans by the amount necessary to reimburse the GSMS 2015-GC30 Servicer, the GSMS 2015-GC30 Trustee or the GSMS 2015-GC30 Special Servicer for any interest accrued on any property protection advances and reimbursement of any property protection advances in accordance with the terms of the GSMS 2015-GC30 Pooling and Servicing Agreement, second, be used to reduce the respective amounts payable on each of the Dallas Market Center Mortgage Loan and the Dallas Market Center Companion Loans by the amount necessary to pay the Master Servicer and the Trustee, and the GSMS 2015-GC30 Servicer and the GSMS 2015-GC30 Trustee for any interest accrued on any P&I Advance (or analogous P&I advance made pursuant to the GSMS 2015-GC30 Pooling and Servicing Agreement) made with respect to such loan by such party (if and as specified in the Pooling and Servicing Agreement or the GSMS 2015-GC30 Pooling and Servicing Agreement, as applicable), third, be used to reduce, on a pro rata basis, the amounts payable on each of the Dallas Market Center Mortgage Loan and the Dallas Market Center Companion Loans by the amount necessary to pay additional trust fund expenses (other than special servicing fees, unpaid workout fees and liquidation fees, each as payable under the GSMS 2015-GC30 Pooling and Servicing Agreement) incurred with respect to the Dallas Market Center Loan Combination (as specified in the GSMS 2015-GC30 Pooling and Servicing Agreement) and, finally, in the case of the remaining amount of penalty charges allocable to the Dallas Market Center Mortgage Loan and the Dallas Market Center Companion Loans, be paid to the GSMS 2015-GC30 Servicer and/or the GSMS 2015-GC30 Special Servicer as additional servicing compensation as provided in the GSMS 2015-GC30 Pooling and Servicing Agreement.
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Sale of Defaulted Loan Combination
Pursuant to the terms of the related Co-Lender Agreement, if the Dallas Market Center Loan Combination becomes a defaulted mortgage loan under the GSMS 2015-GC30 Pooling and Servicing Agreement, and if the GSMS 2015-GC30 Special Servicer determines to sell the controlling Dallas Market Center Companion Loan in accordance with the GSMS 2015-GC30 Pooling and Servicing Agreement, then the GSMS 2015-GC30 Special Servicer will be required to sell all the Dallas Market Center Companion Loans together with the Dallas Market Center Mortgage Loan as one whole loan in accordance with procedures generally similar to those set forth under “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties” in this prospectus supplement. See “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
Notwithstanding the foregoing, the GSMS 2015-GC30 Special Servicer will not be permitted to sell the Dallas Market Center Loan Combination if it becomes a defaulted mortgage loan under the GSMS 2015-GC30 Pooling and Servicing Agreement without the written consent of the Issuing Entity (or its representative), as holder of the Dallas Market Center Mortgage Loan, and the holder of the Dallas Market Center Companion Loan evidenced by the non-controlling note A-3 (or its representative), unless the GSMS 2015-GC30 Special Servicer has delivered to such holder (or its representative): (a) at least 15 business days’ prior written notice of any decision to attempt to sell the Dallas Market Center Loan Combination; (b) at least 10 days prior to the proposed sale date, a copy of each bid package (together with any material amendments to such bid packages) received by the GSMS 2015-GC30 Special Servicer in connection with any such proposed sale; (c) at least 10 days prior to the proposed sale date, a copy of the most recent appraisal for the Dallas Market Center Loan Combination, and any documents in the servicing file reasonably requested by the Issuing Entity (or its representative) that are material to the price of the Dallas Market Center Loan Combination; and (d) until the sale is completed, and a reasonable period of time (but no less time than is afforded to other offerors and the GSMS 2015-GC30 Controlling Class Representative) prior to the proposed sale date, all information and other documents being provided to other offerors and all leases or other documents that are approved by the GSMS 2015-GC30 Servicer or the GSMS 2015-GC30 Special Servicer in connection with the proposed sale;provided, that the Issuing Entity (or its representative) or the holder of the Dallas Market Center Companion Loan evidenced by the non-controlling note A-3 (or its representative) may waive as to itself any of the delivery or timing requirements set forth in this sentence. The Issuing Entity (or its representative) or the holder of the Dallas Market Center Companion Loan evidenced by the non-controlling note A-3 (or its representative) will be permitted to bid at any sale of the Dallas Market Center Loan Combination.
See “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties” in this prospectus supplement.
Special Servicer Appointment Rights
Pursuant to the related Co-Lender Agreement and the Pooling and Servicing Agreement, the directing holder with respect to the Dallas Market Center Loan Combination (which, as of any date of determination, will be the GSMS 2015-GC30 Trustee on behalf of the GSMS 2015-GC30 Issuing Entity as holder of the controlling Dallas Market Center Companion Loan, or its representative which, prior to a control termination event under the GSMS 2015-GC30 Pooling and Servicing Agreement, will be the GSMS 2015-GC30 Controlling Class Representative) will have the right, with or without cause, to replace the GSMS 2015-GC30 Special Servicer then acting with respect to the Dallas Market Center Loan Combination and appoint a replacement special servicer in lieu thereof without the consent of the Issuing Entity (or its representative) or the holder of the Dallas Market Center Companion Loan evidenced by the non-controlling note A-3. The applicable GSMS 2015-GC30 certificateholders with the requisite percentage of voting rights (after a control termination event under the GSMS 2015-GC30 Pooling and Servicing Agreement) will have the right, with or without cause, to replace the GSMS 2015-GC30 Special Servicer then acting with respect to the Dallas Market Center Loan Combination and appoint a replacement special servicer in lieu thereof without the consent of the Issuing Entity (or its representative) or the holder of the Dallas Market Center Companion Loan evidenced by the non-controlling note A-3 (or its representative) in accordance with the GSMS 2015-GC30 Pooling and Servicing Agreement, as described under “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
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The Crowne Plaza Bloomington Loan Combination
Servicing
The Crowne Plaza Bloomington Loan Combination and any related REO Property will be serviced and administered pursuant to the CGCMT 2015-GC29 Pooling and Servicing Agreement, dated as of April 1, 2015, among Citigroup Commercial Mortgage Securities Inc., as depositor, Situs Holdings, LLC, as CGCMT 2015-GC29 Operating Advisor, Midland Loan Services, a Division of PNC Bank, National Association, as CGCMT 2015-GC29 Servicer and as CGCMT 2015-GC29 Special Servicer, Citibank, N.A., as CGCMT 2015-GC29 Certificate Administrator, and Deutsche Bank Trust Company Americas, as CGCMT 2015-GC29 Trustee, which is separate from the Pooling and Servicing Agreement under which your Certificates are issued, by the CGCMT 2015-GC29 Servicer and the CGCMT 2015-GC29 Special Servicer in the manner described under “The Poolingand Servicing Agreement—Certain Considerations Regarding the Outside Serviced Loan Combinations” and “—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement, but subject to the terms of the related Co-Lender Agreement. In servicing the Crowne Plaza Bloomington Loan Combination, the servicing standard set forth in the CGCMT 2015-GC29 Pooling and Servicing Agreement will require the CGCMT 2015-GC29 Servicer and the CGCMT 2015-GC29 Special Servicer to take into account the interests of both the Certificateholders and the related Companion Loan Holder as a collective whole.
Amounts payable to the Issuing Entity as holder of the Crowne Plaza Bloomington Mortgage Loan pursuant to the related Co-Lender Agreement will be included in the Available Funds for the related Distribution Date to the extent described in this prospectus supplement net of certain fees and expenses as set forth in the related Co-Lender Agreement.
Application of Payments
The related Co-Lender Agreement sets forth the respective rights of the holder of the Crowne Plaza Bloomington Mortgage Loan and the holder of the Crowne Plaza Bloomington Companion Loan with respect to distributions of funds received in respect of the Crowne Plaza Bloomington Loan Combination, and provides, in general, that:
· | the Crowne Plaza Bloomington Mortgage Loan and the Crowne Plaza Bloomington Companion Loan are of equal priority with each other and no portion of either of them will have priority or preference over any portion of the other or security therefor; |
· | all payments, proceeds and other recoveries on or in respect of the Crowne Plaza Bloomington Loan Combination or the related Mortgaged Property will be applied to the Crowne Plaza Bloomington Mortgage Loan and the Crowne Plaza Bloomington Companion Loan on apro rata andpari passu basis according to their respective outstanding principal balances (subject, in each case, to the payment and reimbursement rights of the CGCMT 2015-GC29 Servicer, the CGCMT 2015-GC29 Special Servicer, the CGCMT 2015-GC29 Operating Advisor, the CGCMT 2015-GC29 Certificate Administrator and the CGCMT 2015-GC29 Trustee) in accordance with the terms of the related Co-Lender Agreement and the CGCMT 2015-GC29 Pooling and Servicing Agreement; and |
· | expenses, losses and shortfalls relating to the Crowne Plaza Bloomington Loan Combination will, in general, be allocated, on apro rata andpari passu basis, to the Crowne Plaza Bloomington Mortgage Loan and the Crowne Plaza Bloomington Companion Loan. |
Notwithstanding the foregoing, if a P&I Advance is made with respect to the Crowne Plaza Bloomington Mortgage Loan, then that P&I Advance, together with interest thereon, may only be reimbursed out of future payments and collections on the Crowne Plaza Bloomington Mortgage Loan or, as and to the extent described under “The Pooling and Servicing Agreement—Advances” in this prospectus supplement, on other Mortgage Loans, but not out of payments or other collections on the Crowne Plaza Bloomington Companion Loan. Similarly, P&I advances on the Crowne Plaza Bloomington Companion Loan are not reimbursable out of payments or other collections on the Crowne Plaza Bloomington Mortgage Loan.
Certain costs, losses, liabilities, claims and expenses (such as a pro rata share of a property protection advance) allocable to the Crowne Plaza Bloomington Mortgage Loan may be paid or reimbursed out of payments
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and other collections on the mortgage loans in the CGCMT 2015-GC29 Securitization, subject to the CGCMT 2015-GC29 Issuing Entity’s right to reimbursement from future payments and other collections on the Crowne Plaza Bloomington Mortgage Loan or from general collections on the Mortgage Pool.
Consultation and Control
Pursuant to the related Co-Lender Agreement, the directing holder with respect to the Crowne Plaza Bloomington Loan Combination, as of any date of determination, will be the CGCMT 2015-GC29 Trustee on behalf of the CGCMT 2015-GC29 Issuing Entity as holder of the Crowne Plaza Bloomington Companion Loan;provided, that, unless a control termination event exists under the CGCMT 2015-GC29 Pooling and Servicing Agreement, the CGCMT 2015-GC29 Controlling Class Representative will be entitled to exercise the rights of the directing holder with respect to the Crowne Plaza Bloomington Loan Combination. In its capacity as representative of the directing holder under the related Co-Lender Agreement, the CGCMT 2015-GC29 Controlling Class Representative will be entitled to exercise consent and/or consultation rights (which consent and/or consultation rights are substantially similar to, but not necessarily identical to, the rights of the Controlling Class Representative set forth under “The Pooling and Servicing Agreement—Directing Holder” in this prospectus supplement) with respect to any “major decisions” (as defined under the related Co-Lender Agreement) to be taken with respect to the Crowne Plaza Bloomington Loan Combination, and the implementation of any recommended actions outlined in an asset status report with respect to the Crowne Plaza Bloomington Loan Combination will require the approval of the CGCMT 2015-GC29 Controlling Class Representative. Pursuant to the terms of the CGCMT 2015-GC29 Pooling and Servicing Agreement, the CGCMT 2015-GC29 Controlling Class Representative will have the same consent and/or consultation rights with respect to the Crowne Plaza Bloomington Loan Combination as it does, and for so long as it does, with respect to the other mortgage loans included in the CGCMT 2015-GC29 Issuing Entity and serviced under the CGCMT 2015-GC29 Pooling and Servicing Agreement.
In addition, pursuant to the terms of the related Co-Lender Agreement, the Issuing Entity, as holder of the Crowne Plaza Bloomington Mortgage Loan (or its representative which, until a Consultation Termination Event occurs, will be the Controlling Class Representative) will (i) have a right to receive copies of all notices, information and reports that the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer, as applicable, is required to provide to the CGCMT 2015-GC29 Controlling Class Representative (within the same time frame such notices, information and reports are or would have been required to be provided to the CGCMT 2015-GC29 Controlling Class Representative under the CGCMT 2015-GC29 Pooling and Servicing Agreement without regard to the occurrence thereunder of a control termination event or consultation termination event) with respect to any “major decisions” (as defined under the related Co-Lender Agreement) to be taken with respect to the Crowne Plaza Bloomington Loan Combination or the implementation of any recommended action outlined in an asset status report relating to the Crowne Plaza Bloomington Loan Combination and (ii) have the right to be consulted on a strictly non-binding basis with respect to any “major decisions” (as defined under the related Co-Lender Agreement) to be taken with respect to the Crowne Plaza Bloomington Loan Combination or the implementation of any recommended action outlined in an asset status report relating to the Crowne Plaza Bloomington Loan Combination. The consultation right of the Issuing Entity (or its representative) will expire 10 business days following the delivery of notice and information relating to the matter subject to consultation whether or not the Issuing Entity (or its representative) has responded within such period; provided, that if the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer, as applicable, proposes a new course of action that is materially different from the actions previously proposed, the 10 business-day consultation period will be deemed to begin anew. Notwithstanding the Issuing Entity’s (or its representative’s) consultation rights described above, the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer, as applicable, is permitted to take any material action or any action set forth in the asset status report before the expiration of the aforementioned 10 business-day period if it determines that immediate action with respect to such decision is necessary to protect the interests of the holders of the Crowne Plaza Bloomington Loan Combination. Neither the CGCMT 2015-GC29 Servicer nor the CGCMT 2015-GC29 Special Servicer will be obligated at any time to follow or take any alternative actions recommended by the Issuing Entity (or its representative).
Neither the CGCMT 2015-GC29 Servicer nor the CGCMT 2015-GC29 Special Servicer may take or refrain from taking any action based on advice or consultation provided by the Issuing Entity (or its representative) that would cause the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer, as applicable, to violate applicable law, the terms of the Crowne Plaza Bloomington Loan Combination, the related Co-Lender Agreement, the CGCMT 2015-GC29 Pooling and Servicing Agreement, including the servicing standard under the CGCMT 2015-GC29 Pooling and Servicing Agreement, or the REMIC provisions or that would (i) expose the
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CGCMT 2015-GC29 Servicer, the CGCMT 2015-GC29 Special Servicer, the CGCMT 2015-GC29 depositor, a mortgage loan seller with respect to the CGCMT 2015-GC29 Securitization, the CGCMT 2015-GC29 Issuing Entity, the CGCMT 2015-GC29 Trustee, the CGCMT 2015-GC29 Operating Advisor, the CGCMT 2015-GC29 Certificate Administrator or their respective affiliates, officers, directors, employees or agents to any claim, suit or liability, (ii) materially expand the scope of the CGCMT 2015-GC29 Servicer’s or the CGCMT 2015-GC29 Special Servicer’s responsibilities, or (iii) cause the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer to act, or fail to act, in a manner that is not in the best interests of the CGCMT 2015-GC29 certificateholders.
In addition to the consultation rights of the Issuing Entity (or its representative) described above, pursuant to the terms of the related Co-Lender Agreement, the Issuing Entity (or its representative) will have the right to attend (in-person or telephonic) annual meetings with the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer, as applicable, upon reasonable notice and at times reasonably acceptable to the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer, as applicable, for the purpose of discussing servicing issues related to the Crowne Plaza Bloomington Loan Combination. See “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
Application of Penalty Charges
The related Co-Lender Agreement provides that items in the nature of Penalty Charges paid on the Crowne Plaza Bloomington Loan Combination willfirst be used to reduce, on a pro rata basis, the amounts payable on each of the Crowne Plaza Bloomington Mortgage Loan and the Crowne Plaza Bloomington Companion Loan by the amount necessary to reimburse the CGCMT 2015-GC29 Servicer, the CGCMT 2015-GC29 Trustee or the CGCMT 2015-GC29 Special Servicer for any interest accrued on any property protection advances and reimbursement of any property protection advances in accordance with the terms of the CGCMT 2015-GC29 Pooling and Servicing Agreement,second, be used to reduce the respective amounts payable on each of the Crowne Plaza Bloomington Mortgage Loan and the Crowne Plaza Bloomington Companion Loan by the amount necessary to pay the Master Servicer and the Trustee, and the CGCMT 2015-GC29 Servicer and the CGCMT 2015-GC29 Trustee, for any interest accrued on any P&I Advance (or analogous P&I advance made pursuant to the CGCMT 2015-GC29 Pooling and Servicing Agreement) made with respect to such loan by such party (if and as specified in the Pooling and Servicing Agreement or the CGCMT 2015-GC29 Pooling and Servicing Agreement, as applicable),third, be used to reduce, on a pro rata basis, the amounts payable on each of the Crowne Plaza Bloomington Mortgage Loan and the Crowne Plaza Bloomington Companion Loan by the amount necessary to pay additional trust fund expenses (other than special servicing fees, unpaid workout fees and liquidation fees, each as payable under the CGCMT 2015-GC29 Pooling and Servicing Agreement) incurred with respect to the Crowne Plaza Bloomington Loan Combination (as specified in the CGCMT 2015-GC29 Pooling and Servicing Agreement) and,finally, in the case of the remaining amount of penalty charges allocable to the Crowne Plaza Bloomington Mortgage Loan and the Crowne Plaza Bloomington Companion Loan, be paid to the CGCMT 2015-GC29 Servicer and/or the CGCMT 2015-GC29 Special Servicer as additional servicing compensation as provided in the CGCMT 2015-GC29 Pooling and Servicing Agreement.
Sale of Defaulted Loan Combination
Pursuant to the terms of the related Co-Lender Agreement, if the Crowne Plaza Bloomington Loan Combination becomes a defaulted mortgage loan under the CGCMT 2015-GC29 Pooling and Servicing Agreement, and if the CGCMT 2015-GC29 Special Servicer determines to sell the Crowne Plaza Bloomington Companion Loan in accordance with the CGCMT 2015-GC29 Pooling and Servicing Agreement, then the CGCMT 2015-GC29 Special Servicer will be required to sell the Crowne Plaza Bloomington Companion Loan together with the Crowne Plaza Bloomington Mortgage Loan as a single whole loan in accordance with procedures generally similar to the procedures set forth under “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties” in this prospectus supplement. See “—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
Notwithstanding the foregoing, the CGCMT 2015-GC29 Special Servicer will not be permitted to sell the Crowne Plaza Bloomington Loan Combination if it becomes a defaulted mortgage loan under the CGCMT 2015-GC29 Pooling and Servicing Agreement without the written consent of the Issuing Entity (or its representative), as holder of the Crowne Plaza Bloomington Mortgage Loan, unless the CGCMT 2015-GC29 Special Servicer has delivered to such holder (or its representative): (a) at least 15 business days’ prior written notice of any decision to attempt to sell the Crowne Plaza Bloomington Loan Combination; (b) at least 10 days prior to the proposed sale
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date, a copy of each bid package (together with any material amendments to such bid packages) received by the CGCMT 2015-GC29 Special Servicer in connection with any such proposed sale; (c) at least 10 days prior to the proposed sale date, a copy of the most recent appraisal for the Crowne Plaza Bloomington Loan Combination, and any documents in the servicing file reasonably requested by the Issuing Entity (or its representative) that are material to the price of the Crowne Plaza Bloomington Loan Combination; and (d) until the sale is completed, and a reasonable period of time (but no less time than is afforded to other offerors and the CGCMT 2015-GC29 Controlling Class Representative) prior to the proposed sale date, all information and other documents being provided to other offerors and all leases or other documents that are approved by the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer in connection with the proposed sale; provided, that the Issuing Entity (or its representative) may waive any of the delivery or timing requirements set forth in this sentence. The Issuing Entity (or its representative) will be permitted to bid at any sale of the Crowne Plaza Bloomington Loan Combination.
See“The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties”in this prospectus supplement.
Special Servicer Appointment Rights
Pursuant to the related Co-Lender Agreement and the CGCMT 2015-GC29 Pooling and Servicing Agreement, the directing holder with respect to the Crowne Plaza Bloomington Loan Combination (which, as of any date of determination, will be the CGCMT 2015-GC29 Trustee on behalf of the CGCMT 2015-GC29 Issuing Entity as holder of the Crowne Plaza Bloomington Companion Loan, or its representative which, prior to a control termination event under the CGCMT 2015-GC29 Pooling and Servicing Agreement, will be the CGCMT 2015-GC29 Controlling Class Representative) will have the right, at any time, with or without cause, to replace the CGCMT 2015-GC29 Special Servicer then acting with respect to the Crowne Plaza Bloomington Loan Combination and appoint a replacement special servicer in lieu thereof without the consent of the Issuing Entity (or its representative). The applicable CGCMT 2015-GC29 certificateholders with the requisite percentage of voting rights (after a control termination event under the CGCMT 2015-GC29 Pooling and Servicing Agreement) will have the right, with or without cause, to replace the CGCMT 2015-GC29 Special Servicer then acting with respect to the Crowne Plaza Bloomington Loan Combination and appoint a replacement special servicer in lieu thereof without the consent of the Issuing Entity (or its representative), as described under “The Pooling and ServicingAgreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
Significant Obligor
The Mortgaged Property identified on Annex A to this prospectus supplement as 135 South LaSalle, securing a Mortgage Loan representing approximately 13.8% of the Initial Pool Balance, is a “significant obligor” as such term is used in Items 1101 and 1112 of Regulation AB (“Regulation AB”) under the Securities Act of 1933, as amended (the “Securities Act”) with respect to this offering. See “Structural and Collateral Term Sheet—135 South LaSalle” in Annex B to this prospectus supplement.
Representations and Warranties
Each Sponsor will make, with respect to each Mortgage Loan sold by it that we include in the Issuing Entity, representations and warranties generally to the effect set forth on Annex E-1 to this prospectus supplement, subject to the exceptions set forth on Annex E-2 to this prospectus supplement. Each Sponsor will make such representations and warranties in the related mortgage loan purchase agreement, to be dated as of July 1, 2015 (each, a “Mortgage Loan Purchase Agreement”), between the Depositor and the applicable Sponsor.
The representations and warranties:
· | do not cover all of the matters that we would review in underwriting a Mortgage Loan; |
· | should not be viewed as a substitute for a reunderwriting of the Mortgage Loans; and |
· | in some respects represent an allocation of risk rather than a confirmed description of the Mortgage Loans, although the Sponsors have not made representations and warranties that they know to be |
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untrue, when taking into account the exceptions set forth on Annex E-2 to this prospectus supplement. |
If, as provided in the Pooling and Servicing Agreement, there exists a breach of any of the above-described representations and warranties made by the applicable Sponsor, and that breach materially and adversely affects the value of the Mortgage Loan (or any related REO Property) or the interests of the Certificateholders in such Mortgage Loan (or any related REO Property), then that breach will be a material breach as to which the Issuing Entity will have the rights against the applicable Sponsor (and, in the case of RAIT, also against RAIT Financial Trust (“RFT”), as guarantor of the repurchase and substitution obligations of RAIT and, in the case of KGS, also against KGS Holdings, L.P. (“KGS Holdings”), as guarantor of the repurchase and substitution obligations of KGS) as described under “—Cures, Repurchases and Substitutions” below. RFT will guarantee the repurchase and substitution obligations of RAIT under the related Mortgage Loan Purchase Agreement, and KGS Holdings will guarantee the repurchase and substitution obligations of KGS under the related Mortgage Loan Purchase Agreement.
We cannot assure you that the applicable Sponsor (or, in the case of RAIT, RFT, as guarantor of the repurchase and substitution obligations of RAIT or, in the case of KGS, KGS Holdings, as guarantor of the repurchase and substitution obligations of KGS) will be able to repurchase or substitute a Mortgage Loan if a representation or warranty has been breached. See “Risk Factors—Sponsors May Not Be Able to Make Required Repurchases or Substitutions of Defective Mortgage Loans” in this prospectus supplement.
Sale of Mortgage Loans; Mortgage File Delivery
On the Closing Date, the Depositor will acquire the Mortgage Loans from the Sponsors and will simultaneously transfer the Mortgage Loans, without recourse, to the Trustee for the benefit of the Certificateholders. Under the related transaction documents, the Depositor will direct each Sponsor to deliver to the Trustee or to a document custodian on behalf of the Trustee, among other things, the following documents with respect to each Mortgage Loan (subject to the following sentence with respect to any Outside Serviced Mortgage Loan) sold by the applicable Sponsor and each Serviced Loan Combination (collectively, as to each Mortgage Loan or, if applicable, any related Serviced Loan Combination, the “Mortgage File”): (i)(A) for each Mortgage Loan, the original executed Mortgage Note, endorsed on its face or by allonge attached thereto, without recourse, to the order of the Trustee or in blank (or, if the original Mortgage Note has been lost, an affidavit to such effect from the applicable Sponsor or another prior holder, together with a copy of the Mortgage Note), and (B) for each related Serviced Companion Loan, a copy of the executed promissory note for such Serviced Companion Loan; (ii) the original or a copy of the Mortgage, together with an original or copy of any intervening assignments of the Mortgage, in each case (unless the particular item has not been returned from the applicable recording office) with evidence of recording indicated thereon or certified by the applicable recorder’s office; (iii) the original or a copy of any related assignment of leases (if such item is a document separate from the Mortgage) and of any intervening assignments of such assignment of leases, in each case (unless the particular item has not been returned from the applicable recording office) with evidence of recording indicated thereon or certified by the applicable recorder’s office; (iv) an original executed assignment of the Mortgage in favor of the Trustee or in blank and in recordable form (except for missing recording information not yet available if the instrument being assigned has not been returned from the applicable recording office), or a copy of such assignment if the related Sponsor or its designee, rather than the Trustee, is responsible for recording such assignment; (v) an original assignment of any related assignment of leases (if such item is a document separate from the Mortgage) in favor of the Trustee or in blank and in recordable form (except for missing recording information not yet available if the instrument being assigned has not been returned from the applicable recording office), or a copy of such assignment if the related Sponsor or its designee, rather than the Trustee, is responsible for recording such assignment; (vi) the original assignment of all unrecorded documents relating to the Mortgage Loan (or the related Serviced Loan Combination, if applicable), if not already assigned pursuant to items (iv) or (v) above; (vii) originals or copies of all modification agreements in those instances in which the terms or provisions of the Mortgage or the Mortgage Note have been modified, in each case (unless the particular item has not been returned from the applicable recording office) with evidence of recording indicated thereon if the instrument being modified is a recordable document; (viii) the original or a copy of the policy or certificate of lender’s title insurance issued in connection with such Mortgage Loan (or Serviced Loan Combination, if applicable) or, if such policy has not been issued or located, an irrevocable, binding commitment (which may be a marked version of the policy that has been executed by an authorized representative of the title company or an agreement to provide the same pursuant to binding escrow instructions executed by an authorized representative of the title company) to issue such title insurance policy; (ix) an original or copy of the related ground lease, if any, and any ground lessor
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estoppel; (x) an original or copy of the related loan agreement, if any; (xi) an original of any guaranty under such Mortgage Loan (or Serviced Loan Combination, if applicable), if any; (xii) an original or copy of the related lockbox agreement or cash management agreement, if any; (xiii) an original or copy of the environmental indemnity from the related borrower, if any; (xiv) an original or copy of the related escrow agreement and the related security agreement (in each case, if such item is a document separate from the related Mortgage); (xv) if not already included in the assignment referred to in clause (vi) above, an original assignment of the related security agreement (if such item is a document separate from the related Mortgage) in favor of the Trustee; (xvi) in the case of each Loan Combination, an original or a copy of the related Co-Lender Agreement; (xvii) any filed copies (bearing evidence of filing) or evidence of filing of any UCC financing statements in favor of the originator of such Mortgage Loan (or Serviced Loan Combination, if applicable) or in favor of any assignee prior to the Trustee and UCC-2 and/or UCC-3 assignment financing statements in favor of the Trustee or a copy of such assignment financing statements; (xviii) an original or copy of any mezzanine loan intercreditor agreement if any; (xix) the original or copy of any related environmental insurance policy; (xx) a copy of any related letter of credit and any related assignment thereof (with the original to be delivered to the Master Servicer); and (xxi) copies of any related franchise agreement, property management agreement or hotel management agreement and related comfort letters and/or estoppel letters, and any related assignment thereof. Notwithstanding anything to the contrary contained in this prospectus supplement, in the case of an Outside Serviced Mortgage Loan, the preceding document delivery requirement will be deemed satisfied by the delivery by the related Sponsor of, with respect to clause (i), executed originals of the related documents and, with respect to clauses (ii) through (xxi) above, a copy of the mortgage file related to the applicable Outside Serviced Companion Loan delivered under the Outside Servicing Agreement.
As provided in the Pooling and Servicing Agreement, the Trustee, a custodian on its behalf, or another appropriate party as described in the Pooling and Servicing Agreement is required to review each Mortgage File within a specified period following its receipt of such Mortgage File. See “The Pooling and Servicing Agreement—Reports to Certificateholders; Available Information”in this prospectus supplement.
Cures, Repurchases and Substitutions
If there exists a Material Breach of any of the representations and warranties made by a Sponsor with respect to any of the Mortgage Loans sold by it, as discussed under “—Representations and Warranties” above and as set forth on Annex E-1 to this prospectus supplement, or if there exists a Material Document Defect with respect to any Mortgage Loan sold by it, then the applicable Sponsor will be required to remedy that Material Breach or Material Document Defect, as the case may be, in all material respects, or if such Material Breach or Material Document Defect, as the case may be, cannot be cured within the time periods set forth in the applicable Mortgage Loan Purchase Agreement, then the applicable Sponsor will be required to either:
· | within two years following the Closing Date, substitute a Qualified Substitute Mortgage Loan and pay any shortfall amount equal to the difference between the Repurchase Price of the Mortgage Loan calculated as of the date of substitution and the scheduled principal balance of the Qualified Substitute Mortgage Loan as of the due date in the month of substitution; or |
· | to repurchase the affected Mortgage Loan (or any related REO Property) at a price (the “Repurchase Price”) generally equal to the sum of— |
(i) | the outstanding principal balance of that Mortgage Loan at the time of purchase; plus |
(ii) | all outstanding interest, other than default interest or Excess Interest, due with respect to that Mortgage Loan pursuant to the related Mortgage Loan documents through the due date in the collection period of purchase; plus |
(iii) | all unreimbursed property protection advances relating to that Mortgage Loan; plus |
(iv) | all outstanding interest accrued on advances made by the Master Servicer, the Special Servicer and/or the Trustee with respect to that Mortgage Loan; plus |
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(v) | to the extent not otherwise covered by clause (iv) of this bullet, all outstanding Special Servicing Fees and other additional expenses of the Issuing Entity outstanding or previously incurred related to that Mortgage Loan; plus |
(vi) | any Liquidation Fee if and to the extent payable in accordance with the terms and provisions of the Pooling and Servicing Agreement. |
With respect to the RAIT Mortgage Loans, RFT, the parent of RAIT, will guarantee the repurchase obligations of RAIT under the related Mortgage Loan Purchase Agreement in the event RAIT fails to perform its obligations to repurchase or substitute a Qualified Substitute Mortgage Loan for the affected Mortgage Loan and pay any substitution shortfall amount in response to a Material Document Defect or Material Breach. With respect to the KGS Mortgage Loans, KGS Holdings, the parent of KGS, will guarantee the repurchase obligations of KGS under the related Mortgage Loan Purchase Agreement in the event KGS fails to perform its obligations to repurchase or substitute a Qualified Substitute Mortgage Loan for the affected Mortgage Loan and pay any substitution shortfall amount in response to a Material Document Defect or Material Breach.
In addition, each Mortgage Loan Purchase Agreement provides that, with respect to each Outside Serviced Mortgage Loan, if a “material document defect” (as such term or any analogous term is defined in the related Outside Servicing Agreement) exists under the related Outside Servicing Agreement with respect to the related Pari Passu Companion Loan that is included in the related Outside Securitization, and if such Pari Passu Companion Loan is repurchased from such Outside Securitization as a result of such “material document defect” (as such term or any analogous term is defined in the related Outside Servicing Agreement), then the applicable Sponsor will be required to repurchase such Outside Serviced Mortgage Loan;provided,however, that such repurchase obligation does not apply to any “material document defect” related to the promissory note for the subject Pari Passu Companion Loan.
A “Material Breach” is a breach of a representation or warranty that materially and adversely affects the value of the affected Mortgage Loan (or any related REO Property) or the interests of the Certificateholders in the affected Mortgage Loan (or any related REO Property) or causes any Mortgage Loan to fail to be a “qualified mortgage” within the meaning of Code Section 860G(a)(3).
A “Material Document Defect” is a document defect that materially and adversely affects the value of the affected Mortgage Loan (or any related REO Property) or the interests of the Certificateholders in the affected Mortgage Loan (or any related REO Property) or causes any Mortgage Loan to fail to be a “qualified mortgage” within the meaning of Code Section 860G(a)(3). Subject to the applicable Sponsor’s right to cure, failure of such Sponsor to deliver the documents referred to in clauses (i), (ii), (viii), (ix), (xx) and (xxi) in the definition of “Mortgage File”under“—Sale of Mortgage Loans; Mortgage File Delivery” above for any Mortgage Loan will be deemed a Material Document Defect;provided,however, that no document defect (except such a deemed Material Document Defect) will be considered to be a Material Document Defect unless the document with respect to which the document defect exists is required in connection with an imminent enforcement of the lender’s rights or remedies under the related Mortgage Loan, defending any claim asserted by any borrower or third party with respect to the Mortgage Loan, establishing the validity or priority of any lien on any collateral securing the Mortgage Loan or for any immediate significant servicing obligation.
A “Qualified Substitute Mortgage Loan” is a mortgage loan that must, on the date of substitution: (a) have an outstanding principal balance, after application of all scheduled payments of principal and interest due during or prior to the month of substitution, whether or not received, not in excess of the Stated Principal Balance of the deleted Mortgage Loan as of the due date in the calendar month during which the substitution occurs; (b) have a Mortgage Loan Rate not less than the Mortgage Loan Rate of the deleted Mortgage Loan; (c) have the same due date as and a grace period no longer than that of the deleted Mortgage Loan; (d) accrue interest on the same basis as the deleted Mortgage Loan (for example, on the basis of a 360-day year consisting of twelve 30-day months); (e) have a remaining term to stated maturity not greater than, and not more than two years less than, the remaining term to stated maturity of the deleted Mortgage Loan; (f) have a then-current loan-to-value ratio equal to or less than the lesser of (i) the Cut-off Date LTV Ratio for the deleted Mortgage Loan and (ii) 75%, in each case using a “value” for the Mortgaged Property as determined using an appraisal from an Appraiser in accordance with MAI standards; (g) comply (except in a manner that would not be adverse to the interests of the Certificateholders) as of the date of substitution in all material respects with all of the representations and warranties set forth in the applicable Mortgage Loan Purchase Agreement; (h) have an environmental report that indicates no material adverse environmental conditions with respect to the related Mortgaged Property that will be
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delivered as a part of the related servicing file; (i) have a then-current debt service coverage ratio at least equal to the greater of (i) the debt service coverage ratio of the deleted Mortgage Loan as of the Closing Date and (ii) 1.25x; (j) constitute a “qualified replacement mortgage” within the meaning of Code Section 860G(a)(4) as evidenced by an opinion of counsel (provided at the applicable Sponsor’s expense); (k) not have a maturity date or an amortization period that extends to a date that is after the date that is three years prior to the Rated Final Distribution Date; (l) have prepayment restrictions comparable to those of the deleted Mortgage Loan; (m) not be substituted for a deleted Mortgage Loan unless the Trustee and the Certificate Administrator have received a prior Rating Agency Confirmation from each Rating Agency (the cost, if any, of obtaining the Rating Agency Confirmation to be paid by the applicable Sponsor); (n) have been approved, so long as a Consultation Termination Event has not occurred and is not continuing, by the Controlling Class Representative; (o) prohibit defeasance within two years of the Closing Date; (p) not be substituted for a deleted Mortgage Loan if it would result in the termination of the REMIC status of either Trust REMIC or the imposition of tax on either Trust REMIC other than a tax on income expressly permitted or contemplated to be imposed by the terms of the Pooling and Servicing Agreement, as determined by an opinion of counsel; (q) have an engineering report with respect to the related Mortgaged Property which will be delivered as a part of the related servicing file; and (r) be current in the payment of all scheduled payments of principal and interest then due. In the event that more than one Mortgage Loan is substituted for a deleted Mortgage Loan or Mortgage Loans, then (x) the amounts described in clause (a) are required to be determined on the basis of aggregate principal balances and (y) each proposed substitute Mortgage Loan must individually satisfy each of the requirements specified in clauses (b) through (r) of the preceding sentence, except (z) the rates described in clause (b) above and the remaining term to stated maturity referred to in clause (e) above are required to be determined on a weighted average basis;provided that no individual Mortgage Loan Rate (net of the related Administrative Fee Rate) may be lower than the highest fixed Pass-Through Rate (not subject to a cap equal to, or based on, the WAC Rate) of any Class of Sequential Pay Certificates or Trust Component having a principal balance then outstanding. When one or more Qualified Substitute Mortgage Loans are substituted for a deleted Mortgage Loan, the applicable Sponsor will be required to certify that the replacement mortgage loan(s) meet(s) all of the requirements of the above definition and send the certification to the Certificate Administrator and the Trustee and, prior to the occurrence and continuance of a Consultation Termination Event, to the Controlling Class Representative.
The time period within which the applicable Sponsor must complete that remedy, repurchase or substitution will generally be limited to 90 days following the earlier of the applicable Sponsor’s discovery or receipt of notice of, and receipt of a demand to take action with respect to, the related Material Breach or Material Document Defect, as the case may be (or, in the case of a Material Breach or Material Document Defect relating to a Mortgage Loan not being a “qualified mortgage” within the meaning of Code Section 860G(a)(3), 90 days from any party discovering such Material Breach or Material Document Defect,provided that if such discovery is made by a party other than the Sponsor, the Sponsor receives timely notice thereof). However, if the applicable Sponsor is diligently attempting to correct the problem, then, with limited exception (including if such breach or defect would cause the Mortgage Loan not to be a “qualified mortgage” within the meaning of Code Section 860G(a)(3)), it will be entitled to an additional 90 days (or more in the case of a Material Document Defect resulting from the failure of the responsible party to have received the recorded documents) to complete that remedy, repurchase or substitution.
If (x) a Mortgage Loan is to be repurchased or replaced as described above (a “Defective Mortgage Loan”), (y) such Defective Mortgage Loan is part of a Crossed Group and (z) the applicable document defect or breach does not constitute a Material Document Defect or Material Breach, as the case may be, as to the other Mortgage Loan(s) that are a part of such Crossed Group (the “Other Crossed Loans”) (without regard to this paragraph), then the applicable document defect or breach (as the case may be) will be deemed to constitute a Material Document Defect or Material Breach (as the case may be) as to each such Other Crossed Loan for purposes of the above provisions, and the applicable Sponsor will be obligated to repurchase or replace each such Other Crossed Loan in accordance with the provisions above unless the applicable Sponsor satisfies certain conditions set forth in the related Mortgage Loan Purchase Agreement, including, without limitation, that (i) the applicable Sponsor has delivered an opinion that the repurchase of solely the Defective Mortgage Loan will not cause the Issuing Entity to fail to qualify as one or more REMICs or any portion of the Issuing Entity to fail to qualify as a Grantor Trust, and (ii) if the applicable Sponsor were to repurchase or replace only the Defective Mortgage Loan and not the Other Crossed Loans, (x) certain debt service coverage ratio and loan-to-value ratio tests for the Other Crossed Loans (as specified in the related Mortgage Loan Purchase Agreement) would be met, and (y) either the exercise of remedies against the primary collateral of any Mortgage Loan in the Crossed Group will not impair the ability to exercise remedies against the primary collateral of the other Mortgage Loan(s) in the Crossed Group or the related Mortgage Loan documents have been modified in a manner that removes any threat of
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impairment of the ability to exercise remedies against the primary collateral of the other Mortgage Loan(s) in the Crossed Group as a result of the exercise of remedies against the primary collateral of any Mortgage Loan in the Crossed Group. The Master Servicer or the Special Servicer, as applicable, will be entitled to cause to be delivered, or direct the applicable Sponsor to (in which case the applicable Sponsor is required to) cause to be delivered, to the Master Servicer or the Special Servicer, as applicable, an appraisal of any or all of the related Mortgaged Properties for purposes of determining whether the condition set forth above has been satisfied, in each case at the expense of the applicable Sponsor if the scope and cost of the appraisal is approved by the applicable Sponsor and, prior to the occurrence and continuance of a Control Termination Event, the Controlling Class Representative (such approval not to be unreasonably withheld in each case). With respect to any Defective Mortgage Loan that forms a part of a Crossed Group and as to which the conditions described in the first sentence of this paragraph are satisfied, such that the Issuing Entity will continue to hold the Other Crossed Loans, the applicable Sponsor and the Depositor (as predecessor in interest to the Issuing Entity with respect to the subject Crossed Group) have agreed to forbear from enforcing any remedies against the other’s primary collateral but each is permitted to exercise remedies against the primary collateral securing its respective Mortgage Loan(s). If the exercise of remedies by one such party would impair the ability of the other such party to exercise its remedies with respect to the primary collateral securing the Mortgage Loan(s) held by the other such party, then both parties will forbear from exercising such remedies unless and until the related Mortgage Loan documents can be modified to remove the threat of impairment as a result of the exercise of remedies. Any reserve or other cash collateral or letters of credit securing any of the Mortgage Loans that form a Crossed Group will be allocated between such Mortgage Loans in accordance with the related Mortgage Loan documents, or otherwise on apro rata basis based upon their outstanding principal balances.
The cure, repurchase and substitution obligations described above will constitute the sole remedy available to the Series 2015-GC31 certificateholders in connection with a Material Breach of any representation or warranty or a Material Document Defect with respect to any Mortgage Loan in the Issuing Entity. None of the Depositor, the underwriters, the Master Servicer, the Special Servicer, the Trustee, the Certificate Administrator, the Operating Advisor, any other Sponsor or any other person will be obligated to repurchase any affected Mortgage Loan in connection with a Material Breach of any of the representations and warranties or a Material Document Defect if the applicable Sponsor (or, in the case of a RAIT Mortgage Loan, RFT, as guarantor of the repurchase and substitution obligations of RAIT or, in the case of a KGS Mortgage Loan, KGS Holdings, as guarantor of the repurchase and substitution obligations of KGS) defaults on its obligations to do so. We cannot assure you that the applicable Sponsor (or, in the case of a RAIT Mortgage Loan, RFT, as guarantor of the repurchase and substitution obligations of RAIT or, in the case of a KGS Mortgage Loan, KGS Holdings, as guarantor of the repurchase and substitution obligations of KGS) will have sufficient assets to repurchase or substitute a Mortgage Loan if required to do so.
The “Rated Final Distribution Date” for each Class of Offered Certificates will be the Distribution Date in June 2048.
Additional Information
A Current Report on Form 8-K (“Form 8-K”) will be available to purchasers of the Offered Certificates and will be filed pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), together with the Pooling and Servicing Agreement, with the Securities and Exchange Commission (the “SEC”) on or prior to the date of the filing of this prospectus supplement.
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Transaction Parties
The Sponsors
Citigroup Global Markets Realty Corp., Goldman Sachs Mortgage Company, Rialto Mortgage Finance, LLC, RAIT Funding, LLC and KGS-Alpha Real Estate Capital Markets, LLC are the sponsors of this securitization transaction and, accordingly, are referred to as the “Sponsors” in this prospectus supplement.
Citigroup Global Markets Realty Corp.
General
Citigroup Global Markets Realty Corp. (“CGMRC”) is a Sponsor. CGMRC is a New York corporation organized in 1979 and is a wholly-owned subsidiary of Citicorp Banking Corporation, a Delaware corporation, which is in turn a wholly-owned subsidiary of Citigroup Inc., a Delaware corporation. CGMRC maintains its principal office at 388 Greenwich Street, New York, New York 10013, Attention: Mortgage Finance Group. Its facsimile number is (212) 723-8604. CGMRC is an affiliate of Citigroup Commercial Mortgage Securities Inc., the depositor, Citigroup Global Markets Inc., one of the underwriters, and Citibank, N.A., the Certificate Administrator, Certificate Registrar and paying agent. CGMRC makes, and purchases from lenders, commercial and multifamily mortgage loans primarily for the purpose of securitizing them in CMBS transactions. CGMRC also purchases and finances residential mortgage loans, consumer receivables and other financial assets.
Neither CGMRC nor any of its affiliates will insure or guarantee distributions on the Certificates. The Certificateholders will have no rights or remedies against CGMRC for any losses or other claims in connection with the Certificates or the Mortgage Loans except in respect of the repurchase and substitution obligations for material document defects or material breaches of the representations and warranties made by CGMRC in the related Mortgage Loan Purchase Agreement as described under “Description of the Mortgage Pool—Cures, Repurchases and Substitutions” in this prospectus supplement.
CGMRC’s Commercial Mortgage Origination and Securitization Program
CGMRC, directly or through correspondents or affiliates, originates multifamily and commercial mortgage loans throughout the United States and abroad. CGMRC has been engaged in the origination of multifamily and commercial mortgage loans for securitization since 1996 and has been involved in the securitization of residential mortgage loans since 1987. The multifamily and commercial mortgage loans originated by CGMRC include both fixed rate loans and floating rate loans. Most of the multifamily and commercial mortgage loans included by CGMRC in commercial mortgage securitizations sponsored by CGMRC have been originated, directly or through correspondents, by CGMRC or an affiliate. CGMRC securitized approximately $1.25 billion, $1.49 billion, $2.60 billion, $4.27 billion, $7.02 billion, $6.35 billion, $1.08 billion, $0, $517 million, $1.25 billion, $1.73 billion, $4.75 billion and $5.23 billion of multifamily and commercial mortgage loans in public and private offerings during the calendar years 2002, 2003, 2004, 2005, 2006, 2007, 2008, 2009, 2010, 2011, 2012, 2013 and 2014, respectively.
In addition, in the normal course of its business, CGMRC may also acquire multifamily and commercial mortgage loans from various third-party originators. These mortgage loans may have been originated using underwriting guidelines not established by CGMRC.
CGMRC has also sponsored, in private placement transactions, multifamily and commercial mortgage loans which it either originated or acquired from third-party originators that underwrote them to their own underwriting criteria.
In connection with the commercial mortgage securitization transactions in which it participates, CGMRC generally transfers the subject mortgage assets to a depositor, who then transfers those mortgage assets to the issuing entity for the related securitization. In return for the transfer of the subject mortgage assets by the depositor to the issuing entity, the issuing entity issues commercial mortgage pass-through certificates that are in whole or in part backed by, and supported by the cash flows generated by, those mortgage assets.
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CGMRC generally works with rating agencies, unaffiliated mortgage loan sellers, servicers, affiliates and underwriters in structuring a securitization transaction. CGMRC will generally act as a sponsor, originator or mortgage loan seller in the commercial mortgage securitization transactions in which it participates. In such transactions there may be a co-sponsor and/or other mortgage loan sellers and originators. Generally CGMRC and/or the related depositor contract with other entities to service the multifamily and commercial mortgage loans following their transfer into a trust fund for a series of certificates.
Review of CGMRC Mortgage Loans
General. In connection with the preparation of this prospectus supplement, CGMRC conducted a review of the Mortgage Loans that it is selling to the Depositor. The review was conducted as set forth below and was conducted with respect to each of the CGMRC Mortgage Loans. No sampling procedures were used in the review process.
Database. First, CGMRC created a database of information (the “CGMRC Securitization Database”) obtained in connection with the origination of the CGMRC Mortgage Loans, including:
· | certain information from the CGMRC Mortgage Loan documents; |
· | certain information from the rent rolls and operating statements for, and certain leases relating to, the related Mortgaged Properties (in each case to the extent applicable); |
· | insurance information for the related Mortgaged Properties; |
· | information from third party reports such as the appraisals, environmental and property condition reports, seismic reports, zoning reports and other zoning information; |
· | bankruptcy searches with respect to the related borrowers; and |
· | certain information and other search results obtained by the CGMRC deal team for each of the CGMRC Mortgage Loans during the underwriting process. |
CGMRC also included in the CGMRC Securitization Database certain updates to such information received by the CGMRC securitization team after origination, such as information from the interim servicer regarding loan payment status and current escrows, updated rent rolls and leasing activity information provided pursuant to the Mortgage Loan documents, and information otherwise brought to the attention of the CGMRC securitization team. Such updates were not intended to be, and do not serve as, a re-underwriting of any Mortgage Loan.
Using the information in the CGMRC Securitization Database, CGMRC created a Microsoft Excel file (the “CGMRC Data File”) and provided that file to the Depositor for the inclusion in this prospectus supplement (particularly in Annexes A, B and C to this prospectus supplement) of information regarding the CGMRC Mortgage Loans.
Data Comparison and Recalculation. CGMRC engaged a third-party accounting firm to perform certain data comparison and recalculation procedures designed by CGMRC, relating to information in this prospectus supplement regarding the CGMRC Mortgage Loans. These procedures included:
· | comparing the information in the CGMRC Data File against various source documents provided by CGMRC that are described above under “—Database”; |
· | comparing numerical information regarding the CGMRC Mortgage Loans and the related Mortgaged Properties disclosed in this prospectus supplement against the CGMRC Data File; and |
· | recalculating certain percentages, ratios and other formulae relating to the CGMRC Mortgage Loans disclosed in this prospectus supplement. |
Legal Review. CGMRC also reviewed and responded to a Due Diligence Questionnaire (as defined below) relating to the CGMRC Mortgage Loans, which questionnaire was prepared by the Depositor’s legal counsel for
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use in eliciting information relating to the CGMRC Mortgage Loans and including such information in this prospectus supplement to the extent material.
Although the Due Diligence Questionnaire may be revised from time to time, it typically contains various questions regarding the CGMRC Mortgage Loans, the related Mortgaged Properties, the related borrowers, sponsors and tenants, and any related additional debt. For example, the due diligence questionnaire (a “Due Diligence Questionnaire”) may seek to elicit, among other things, the following information:
· | whether any mortgage loans were originated by third party originators and the names of such originators, and whether such mortgage loans were underwritten or re-underwritten in accordance with CGMRC’s (or the applicable mortgage loan seller’s) criteria; |
· | whether any mortgage loans are not first liens, or have a loan-to-value ratio greater than 80%; |
· | whether any mortgage loans are 30 days or more delinquent with respect to any monthly debt service payment as of the cut-off date or have been 30 days or more delinquent at any time during the 12-month period immediately preceding the cut-off date; |
· | a description of any material issues with respect to any of the mortgage loans; |
· | whether any mortgage loans permit, or have existing, mezzanine debt, additional debt secured by the related mortgaged properties or other material debt, and the material terms and conditions for such debt; |
· | whether any mortgaged properties have additional debt that is included in another securitization transaction and information related to such other securitization transaction; |
· | whether intercreditor agreements, subordination and standstill agreements or similar agreements are in place with respect to secured debt, mezzanine debt or additional debt and the terms of such agreements; |
· | a list of any mortgage loans that are interest-only for their entire term or a portion of their term; |
· | a list of mortgage loans that permit prepayment or defeasance (in whole or in part), or provide for yield maintenance, and the types of prepayment lock-out provisions and prepayment charges that apply; |
· | whether any mortgage loans permit the release of all or a portion of the related mortgaged properties, and the material terms of any partial release, substitution and condemnation/casualty provisions; |
· | a list of mortgage loans that are cross-collateralized or secured by multiple properties, or that have related borrowers with other mortgage loans in the subject securitization; |
· | whether any mortgage loans have a right of first refusal or right of first offer or similar options, in favor of a tenant or any other party; |
· | whether there are post-close escrows or earn-out reserves that could be used to pay down the mortgage loan, or whether there are escrows or holdbacks that have not been fully funded; |
· | information regarding lockbox arrangements, grace periods, interest accrual and amortization provisions, non-recourse carveouts, and any other material provisions with respect to the mortgage loan; |
· | whether the borrower or sponsor of any related borrower has been subject to bankruptcy proceedings, or has a past or present material criminal charge or record; |
· | whether any borrower is not a special purpose entity; |
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· | whether any borrowers or sponsors of related borrowers have been subject to litigation or similar proceedings and the material terms thereof; |
· | whether any borrower under a mortgage loan is affiliated with a borrower under another Mortgage Loan to be included in the issuing entity; |
· | whether any of the mortgage loans is a leasehold mortgage, the terms of the related ground lease, and whether the term of the related ground lease extends at least 20 years beyond the stated loan maturity; |
· | a list of any related Mortgaged Properties for which a single tenant occupies over 20% of such property, and whether there are any significant lease rollovers at a particular Mortgaged Property; |
· | a list of any significant tenant concentrations or material tenant issues, e.g., dark tenants, subsidized tenants, government or student tenants, or Section 8 tenants, etc.; |
· | a description of any material leasing issues at the related Mortgaged Properties; |
· | whether any related Mortgaged Properties are subject to condemnation proceedings or litigation; |
· | a list of related Mortgaged Properties for which a Phase I environmental site assessment has not been completed, or for which a Phase II was performed, and whether any environmental site assessment reveals any material adverse environmental condition or circumstance at any related Mortgaged Property except for those which will be remediated by the cut-off date; |
· | whether there is any terrorism, earthquake, tornado, flood, fire or hurricane damage with respect to any of the related Mortgaged Properties, or whether there are any zoning issues at the Mortgaged Properties; |
· | a list of Mortgaged Properties for which an engineering inspection has not been completed and whether any property inspection revealed material issues; and/or |
· | general information regarding property type, condition, use, plans for renovation, etc. |
CGMRC also provided to origination counsel the Sponsor representations and warranties attached as Annex E-1 to this prospectus supplement and requested that origination counsel identify exceptions to such representations and warranties. CGMRC compiled and reviewed the draft exceptions received from origination counsel, engaged separate counsel to review the exceptions, revised the exceptions and provided them to the Depositor for inclusion on Annex E-2 to this prospectus supplement. In addition, for each CGMRC Mortgage Loan originated by CGMRC or its affiliates, CGMRC prepared and delivered to its securitization counsel for review an asset summary, which summary includes important loan terms and certain property level information obtained during the origination process. The loan terms included in each asset summary may include, without limitation, the principal amount, the interest rate, the loan term, the interest calculation method, the due date, any applicable interest-only period, any applicable amortization period, a summary of any prepayment and/or defeasance provisions, a summary of any lockbox and/or cash management provisions, a summary of any release provisions, and a summary of any requirement for the related borrower to fund up-front and/or on-going reserves. The property level information obtained during the origination process included in each asset summary may include, without limitation, a description of the related Mortgaged Property (including property type, ownership structure, use, location, size, renovations, age and physical attributes), information relating to the commercial real estate market in which the Mortgaged Property is located, information relating to the related borrower and sponsor of the related borrower, an underwriter’s assessment of strengths and risks of the loan transaction, tenant analysis, and summaries of third party reports such as appraisal, environmental and property condition reports.
For each CGMRC Mortgage Loan, if any, purchased by CGMRC or its affiliates from a third-party originator of such Mortgage Loan, CGMRC reviewed the purchase agreement and related representations and warranties, and exceptions to those representations and warranties, made by the seller of such CGMRC Mortgage Loan to CGMRC or its affiliates, reviewed certain provisions of the related Mortgage Loan documents and third party
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reports concerning the related mortgaged property provided by the originator of such Mortgage Loan, prepared exceptions to the representations and warranties in the Mortgage Loan Purchase Agreement based upon such review, and provided them to the Depositor for inclusion on Annex E-2 to this prospectus supplement. With respect to any CGMRC Mortgage Loan that is purchased by CGMRC or its affiliates from a third party originator, the representations and warranties made by the third party originator in the related purchase agreement between CGMRC or its affiliates, on the one hand, and the third party originator, on the other hand, are solely for the benefit of CGMRC or its affiliates. The rights, if any, that CGMRC or its affiliates may have under such purchase agreement upon a breach of such representations and warranties made by the third party originator will not be assigned to the trustee, and the certificateholders and the trustee will not have any recourse against the third party originator in connection with any breach of the representations and warranties made by such third party originator. As described above under “Description of the Mortgage Pool—Cures, Repurchases and Substitutions”, the substitution or repurchase obligation of CGMRC, as mortgage loan seller, with respect to the CGMRC Mortgage Loans under the related Mortgage Loan Purchase Agreement constitutes the sole remedy available to the Certificateholders and the Trustee for any uncured material breach of any CGMRC’s representations and warranties regarding the CGMRC Mortgage Loans, including any CGMRC Mortgage Loan that are purchased by CGMRC or its affiliates from a third party originator.
In addition, with respect to each CGMRC Mortgage Loan, CGMRC reviewed, and in certain cases requested that its counsel review, certain Mortgage Loan document provisions as necessary for disclosure of such provisions in this prospectus supplement, such as property release provisions and other provisions specifically disclosed in this prospectus supplement.
Certain Updates. Furthermore, CGMRC requested the borrowers under the CGMRC Mortgage Loans (or the borrowers’ respective counsel) for updates on any significant pending litigation that existed at origination. Moreover, if CGMRC became aware of a significant natural disaster in the vicinity of a Mortgaged Property relating to a CGMRC Mortgage Loan, CGMRC requested information on the property status from the related borrower in order to confirm whether any material damage to the property had occurred.
Large Loan Summaries. Finally, CGMRC prepared, and reviewed with originating counsel and/or securitization counsel, the loan summaries for those of the CGMRC Mortgage Loans included in the 10 largest Mortgage Loans (considering any Crossed Group as a single Mortgage Loan) in the mortgage pool, and the abbreviated loan summaries for those of the CGMRC Mortgage Loans included in the next 10 largest Mortgage Loans (considering any Crossed Group as a single Mortgage Loan) in the mortgage pool, which loan summaries and abbreviated loan summaries are incorporated in the “Structural and Collateral Term Sheet” in Annex B to this prospectus supplement.
Findings and Conclusions. Based on the foregoing review procedures, CGMRC found and concluded that the disclosure regarding the CGMRC Mortgage Loans in this prospectus supplement is accurate in all material respects. CGMRC also found and concluded that the CGMRC Mortgage Loans were originated in accordance with CGMRC’s origination procedures and underwriting criteria, except for any material deviations described under “—The Originators—Citigroup Global Markets Realty Corp.—Exceptions to Underwriting Criteria” in this prospectus supplement. CGMRC attributes to itself all findings and conclusions resulting from the foregoing review procedures.
Repurchase Requests
CGMRC most recently filed a Form ABS-15G on February 17, 2015. CGMRC’s Central Index Key is 0001541001. With respect to the period from and including April 1, 2012 to and including March 31, 2015, CGMRC does not have any activity to report as required by Rule 15Ga-1 under the Exchange Act with respect to repurchase or replacement requests in connection with breaches of representations and warranties made by it as a sponsor of commercial mortgage securitizations.
Goldman Sachs Mortgage Company
General
Goldman Sachs Mortgage Company (“GSMC”) is a Sponsor. GSMC is a New York limited partnership. GSMC was formed in 1984. Its general partner is Goldman Sachs Real Estate Funding Corp. and its limited partner is Goldman Sachs Bank USA. GSMC’s executive offices are located at 200 West Street, New York, New
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York 10282, telephone number (212) 902-1000. GSMC is an affiliate of GS Commercial Real Estate LP, an Originator, and an affiliate of Goldman, Sachs & Co., one of the underwriters.
GSMC’s Commercial Mortgage Securitization Program
As a sponsor, GSMC originates and acquires fixed- and floating-rate commercial mortgage loans and either by itself or together with other sponsors or mortgage loan sellers, organizes and initiates the public and/or private securitization of such commercial mortgage loans by transferring the commercial mortgage loans to a securitization depositor, including GS Commercial Securities Corporation II or another entity that acts in a similar capacity. In coordination with its affiliates, GS Commercial Real Estate LP and other unaffiliated underwriters, GSMC works with rating agencies, investors, unaffiliated mortgage loan sellers and servicers in structuring the securitization transaction.
From the beginning of its participation in commercial mortgage securitization programs in 1996 through December 31, 2014, GSMC originated or acquired approximately 2,374 fixed and floating rate commercial and multifamily mortgage loans with an aggregate original principal balance of approximately $78.5 billion. As of December 31, 2014, GSMC had acted as a sponsor and mortgage loan seller on 100 fixed and floating-rate commercial mortgage-backed securitization transactions. GSMC securitized approximately $2.165 billion, $4.636 billion, $6.586 billion and $5.098 billion of commercial mortgage loans in public and private offerings in calendar years 2011, 2012, 2013 and 2014, respectively.
Neither GSMC nor any of its affiliates will insure or guarantee distributions on the Certificates. The Certificateholders will have no rights or remedies against GSMC for any losses or other claims in connection with the Certificates or the Mortgage Loans except in respect of the repurchase and substitution obligations for material document defects or the material breaches of representations and warranties made by GSMC in the related Mortgage Loan Purchase Agreement as described under “Description of the Mortgage Pool—Cures, Repurchases and Substitutions” in this prospectus supplement.
Review of GSMC Mortgage Loans
Overview. GSMC, in its capacity as the Sponsor of the GSMC Mortgage Loans, has conducted a review of the GSMC Mortgage Loans in connection with the securitization described in this prospectus supplement. The review of the GSMC Mortgage Loans was performed by a deal team comprised of real estate and securitization professionals who are employees of one or more of GSMC’s affiliates (the “GSMC Deal Team”). The review procedures described below were employed with respect to all of the GSMC Mortgage Loans, except that certain review procedures only were relevant to the large loan disclosures in this prospectus supplement, as further described below. No sampling procedures were used in the review process.
Database. To prepare for securitization, members of the GSMC Deal Team created a database of loan-level and property-level information relating to each GSMC Mortgage Loan. The database was compiled from, among other sources, the related Mortgage Loan documents, Third Party Reports, zoning reports, insurance policies, borrower supplied information (including, but not limited to, rent rolls, leases, operating statements and budgets) and information collected by the Goldman Originators during the underwriting process. After origination of each GSMC Mortgage Loan, the GSMC Deal Team updated the information in the database with respect to the GSMC Mortgage Loan based on updates provided by the related servicer relating to loan payment status and escrows, updated operating statements, rent rolls and leasing activity, and information otherwise brought to the attention of the GSMC Deal Team.
A data tape (the “GSMC Data Tape”) containing detailed information regarding each GSMC Mortgage Loan was created from the information in the database referred to in the prior paragraph. The GSMC Data Tape was used by the GSMC Deal Team to provide certain numerical information regarding the GSMC Mortgage Loans in this prospectus supplement.
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Data Comparison and Recalculation. GSMC engaged a third-party accounting firm to perform certain data comparison and recalculation procedures designed by GSMC, relating to information in this prospectus supplement regarding the GSMC Mortgage Loans. These procedures included:
· | comparing certain information in the GSMC Data Tape against various source documents provided by GSMC that are described above under “—Database”; |
· | comparing numerical information regarding the GSMC Mortgage Loans and the related Mortgaged Properties disclosed in this prospectus supplement against the GSMC Data Tape; and |
· | recalculating certain percentages, ratios and other formulae relating to the GSMC Mortgage Loans disclosed in this prospectus supplement. |
Legal Review. GSMC engaged various law firms to conduct certain legal reviews of the GSMC Mortgage Loans for disclosure in this prospectus supplement. In anticipation of the securitization of each GSMC Mortgage Loan, origination counsel prepared a loan and property summary that sets forth salient loan terms and summarizes material deviations from GSMC’s standard form loan documents. In addition, origination counsel for each GSMC Mortgage Loan reviewed GSMC’s representations and warranties set forth on Annex E-1 to this prospectus supplement and, if applicable, identified exceptions to those representations and warranties.
Securitization counsel was also engaged to assist in the review of the GSMC Mortgage Loans. Such assistance included, among other things, (i) a review of sections of the loan agreement relating to certain GSMC Mortgage Loans marked against the standard form document, (ii) a review of the loan and property summaries referred to above relating to the GSMC Mortgage Loans prepared by origination counsel and (iii) a review of a Due Diligence Questionnaire completed by the GSMC Deal Team. Securitization counsel also reviewed the property release provisions, if any, for each GSMC Mortgage Loan with multiple Mortgaged Properties for compliance with the REMIC provisions of the Code. In addition, for each GSMC Mortgage Loan originated by GSMC or its affiliates, GSMC prepared and delivered to its securitization counsel for review an asset summary, which summary includes important loan terms and certain property level information obtained during the origination process.
Origination counsel or securitization counsel also assisted in the preparation of the Mortgage Loan summaries set forth under “Structural and Collateral Term Sheet—Selig Office Portfolio”,“—Dallas Market Center”, “—Orinda Square”, “—Park at Sugar Creek”, “—Mesa Town Center”, “—Hagerstown Plaza” and “—Oakmont Apartments” in Annex B to this prospectus supplement, based on their respective reviews of pertinent sections of the related Mortgage Loan documents. The applicable borrowers and borrowers’ counsel reviewed these Mortgage Loan summaries as well.
Other Review Procedures. With respect to any pending litigation that existed at the origination of any GSMC Mortgage Loan, GSMC requested updates from the related borrower, origination counsel and/or borrower’s litigation counsel. GSMC conducted a search with respect to each borrower under a GSMC Mortgage Loan to determine whether it filed for bankruptcy after origination of the GSMC Mortgage Loan. If GSMC became aware of a significant natural disaster in the vicinity of any Mortgaged Property securing a GSMC Mortgage Loan, GSMC obtained information on the status of the Mortgaged Property from the related borrower to confirm no material damage to the Mortgaged Property.
The GSMC Deal Team also consulted with the Goldman Originators to confirm that the GSMC Mortgage Loans were originated in compliance with the origination and underwriting criteria described below under “—The Originators—The Goldman Originators—Origination and Underwriting Process”, as well as to identify any material deviations from those origination and underwriting criteria. See “—The Originators—The Goldman Originators—Exceptions to Underwriting Criteria” below.
Findings and Conclusions. Based on the foregoing review procedures, GSMC determined that the disclosure regarding the GSMC Mortgage Loans in this prospectus supplement is accurate in all material respects. GSMC also determined that the GSMC Mortgage Loans were originated in accordance with the Goldman Originators’ origination procedures and underwriting criteria, except as described under “—The Originators—The Goldman Originators—Exceptions to Underwriting Criteria” below. GSMC attributes to itself all findings and conclusions resulting from the foregoing review procedures.
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Repurchase Requests
GSMC most recently filed a Form ABS-15G on May 15, 2015. GSMC’s Central Index Key is 0001541502. With respect to the period from and including January 1, 2012 to and including March 31, 2015, GSMC does not have any activity to report as required by Rule 15Ga-1 under the Exchange Act with respect to repurchase or replacement requests in connection with breaches of representations and warranties made by it as a sponsor of commercial mortgage securitizations.
Rialto Mortgage Finance, LLC
General
Rialto Mortgage Finance, LLC, a Delaware limited liability company formed in April 2013 (“Rialto”), a Sponsor and an Originator, is wholly-owned by Rialto Capital Management, LLC, a Delaware limited liability company that was formed in January 2009. The executive offices of Rialto are located at 600 Madison Avenue, 12th Floor, New York, New York 10022.
Goldman Sachs Bank USA, an affiliate of GSMC, provides warehouse financing to an affiliate of Rialto through a repurchase facility. All of the Mortgage Loans that Rialto will transfer to the Depositor, with an aggregate principal balance of approximately $90,851,031 as of the Cut-off Date and representing approximately 12.6% of the Initial Pool Balance, are subject to that repurchase facility. Proceeds received by Rialto in connection with the contribution of Mortgage Loans to this securitization transaction will be applied, among other things, to reacquire the financed Mortgage Loans and make payments to Goldman Sachs Bank USA as the repurchase agreement counterparty.
Rialto’s Securitization Program
As a Sponsor, Rialto originates and acquires commercial real estate mortgage loans with a general focus on stabilized income-producing properties. All of the Mortgage Loans being sold to the Depositor by Rialto (the “Rialto Mortgage Loans”) were originated by Rialto. This is the nineteenth commercial real estate debt investment securitization to which Rialto is contributing commercial real estate debt investments. The commercial real estate debt investments originated and acquired by Rialto may include mortgage loans, mezzanine loans, B notes, participation interests, rake bonds, subordinate mortgage loans and preferred equity investments. Rialto securitized approximately $712 million and $1.49 billion of multifamily and commercial mortgage loans in public and private offerings during the calendar years 2013 and 2014, respectively.
Neither Rialto nor any of its affiliates will insure or guarantee distributions on the Certificates. The Certificateholders will have no rights or remedies against Rialto for any losses or other claims in connection with the Certificates or the Mortgage Loans except in respect of the repurchase and substitution obligations for material document defects or material breaches of representations and warranties made by Rialto in the applicable Mortgage Loan Purchase Agreement as described under “Description of the Mortgage Pool—Cures, Repurchases and Substitutions” in this prospectus supplement.
Review of Rialto Mortgage Loans
Overview. Rialto has conducted a review of each of the Rialto Mortgage Loans. This review was performed by a team comprised of real estate and securitization professionals who are employees of Rialto or one or more of its affiliates (the “Rialto Review Team”). The review procedures described below were employed with respect to the Rialto Mortgage Loans. No sampling procedures were used in the review process. Rialto is the Sponsor with respect to nine (9) Mortgage Loans.
Set forth below is a discussion of certain current general guidelines of Rialto generally applicable with respect to Rialto’s underwriting analysis of multifamily and commercial real estate properties which serve as the direct or indirect source of repayment for commercial real estate debt originated by Rialto. All or a portion of the underwriting guidelines described below may not be applied exactly as described below at the time a particular asset is originated by Rialto.
Database. To prepare for securitization, members of the Rialto Review Team reviewed a database of loan-level and property-level information relating to the Rialto Mortgage Loans. The database was compiled from,
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among other sources, the related Mortgage Loan documents, appraisals, environmental assessment reports, property condition reports, zoning reports, insurance review summaries, borrower-supplied information (including, but not limited to, rent rolls, leases, operating statements and budgets) and information collected by the Rialto Review Team during the underwriting process. Prior to securitization of the Rialto Mortgage Loans, the Rialto Review Team may have updated the information in the database with respect to the Rialto Mortgage Loans based on updates provided by the related servicer which may include information relating to loan payment status and escrows, updated operating statements, rent rolls and leasing activity, and information otherwise brought to the attention of the Rialto Review Team, to the extent such updates were provided to, and deemed material by, the Rialto Review Team. Such updates, if any, were not intended to be, and do not serve as, a re-underwriting of the Rialto Mortgage Loans.
A data tape (the “Rialto Data Tape”) containing detailed information regarding the Rialto Mortgage Loans was created from the information in the database referred to in the prior paragraph. The Rialto Data Tape was used to provide the numerical information regarding the Rialto Mortgage Loans in this prospectus supplement.
Data Comparison and Recalculation. Rialto engaged a third-party accounting firm to perform certain data comparison and recalculation procedures designed by Rialto, relating to information in this prospectus supplement regarding the Rialto Mortgage Loans. These procedures included:
· | comparing the information in the Rialto Data Tape against various source documents provided by Rialto; |
· | comparing numerical information regarding the Rialto Mortgage Loans and the related Mortgaged Properties disclosed in this prospectus supplement against the information contained in the Rialto Data Tape; and |
· | recalculating certain percentages, ratios and other formulae relating to the Rialto Mortgage Loans disclosed in this prospectus supplement. |
Legal Review. Rialto engaged legal counsel to conduct certain legal reviews of the Rialto Mortgage Loans for disclosure in this prospectus supplement. In anticipation of the securitization described in this prospectus supplement, Rialto’s origination counsel reviewed a form of securitization representations and warranties at origination and, if applicable, identified exceptions to those representations and warranties. Rialto’s origination and underwriting staff also performed a review of the representations and warranties.
Legal counsel was also engaged in connection with this securitization transaction to assist in the review of the Rialto Mortgage Loans. Such assistance included, among other things, (i) a review of certain of Rialto’s asset summary reports, (ii) the review of the representation and warranties and exception reports referred to above relating to the Rialto Mortgage Loans prepared by origination counsel, (iii) the review of, and assistance in the completion by the Rialto Review Team of, a Due Diligence Questionnaire relating to the Rialto Mortgage Loans and (iv) the review of certain provisions in loan documents with respect to certain of the Rialto Mortgage Loans.
Other Review Procedures. The Rialto Review Team, with the assistance of counsel engaged in connection with this securitization transaction, also reviewed each Rialto Mortgage Loan to determine whether it materially deviated from the underwriting guidelines set forth under “—The Originators—Rialto Mortgage Finance, LLC—Rialto’s Underwriting Standards and Loan Analysis” below.
Findings and Conclusions. Based on the foregoing review procedures, Rialto determined that the disclosure regarding the Rialto Mortgage Loans in this prospectus supplement is accurate in all material respects. Rialto also determined that the Rialto Mortgage Loans were not originated with any material exceptions from Rialto’s underwriting guidelines and procedures. Rialto attributes to itself all findings and conclusions resulting from the foregoing review procedures.
Review Procedures in the Event of a Mortgage Loan Substitution. Rialto will perform a review of any Rialto Mortgage Loan that it elects to substitute for a Rialto Mortgage Loan in the pool in connection with a Material Breach or a Material Document Defect. Rialto, and if appropriate its legal counsel, will review the Mortgage Loan documents and servicing history of the substitute mortgage loan to confirm it meets each of the criteria required under the terms of the related Mortgage Loan Purchase Agreement and the Pooling and Servicing Agreement (the “Qualification Criteria”). Rialto will engage a third party accounting firm to compare the Qualification Criteria against the underlying source documentation to verify the accuracy of the review by Rialto and to confirm any
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numerical and/or statistical information to be disclosed in any required filings under the Exchange Act. Legal counsel will also be engaged by Rialto to render any tax opinion required in connection with the substitution.
Repurchase Requests
Rialto most recently filed a Form ABS-15G on February 6, 2015. Rialto’s Central Index Key number is 0001592182. With respect to the period from and including April 1, 2012 to and including March 31, 2015, Rialto does not have any activity to report as required by Rule 15Ga-1 under the Exchange Act with respect to repurchase or replacement requests in connection with breaches of representations and warranties made by it as a sponsor of commercial mortgage securitizations.
RAIT Funding, LLC
General
RAIT Funding, LLC, a Delaware limited liability company (“RAIT”), is an operating subsidiary of RFT, a vertically integrated and internally managed real estate investment trust that originates and services commercial real estate loans, manages and advises on commercial real estate-related assets and acquires commercial real estate assets. RFT is headquartered at 2929 Arch Street, 17th Floor, Philadelphia, Pennsylvania 19104, and also has offices in New York, New York, Charlotte, North Carolina and Chicago, Illinois.
Citibank, N.A., the Certificate Administrator and an affiliate of the Depositor and of CGMRC, provides warehouse financing to an affiliate of RAIT through a repurchase facility. Five (5) of the RAIT Mortgage Loans, with an aggregate principal balance of approximately $25,634,229 as of the Cut-off Date and representing approximately 3.5% of the Initial Pool Balance, are subject to that repurchase facility. Proceeds received by RAIT in connection with the sale of the RAIT Mortgage Loans to the Depositor will be applied, among other things, to reacquire such financed RAIT Mortgage Loans and make payments to Citibank, N.A., as the repurchase agreement counterparty.
RAIT’s Securitization Program
RFT, through its operating subsidiaries, RAIT and RAIT Partnership, L.P., a Delaware limited partnership (“RAIT Partnership”), originates commercial mortgages, mezzanine loans, other loans and preferred equity interests that are collateralized by office buildings, retail shopping centers, multifamily apartment complexes and other properties located throughout the United States of America. RAIT’s commercial mortgage securitization program generally provides fixed rate mortgage loans having maturities between five and ten years. Additionally, RAIT Partnership provides bridge/transitional loans, mezzanine loans and preferred equity structures.
RAIT, RAIT Partnership and their affiliates directly or indirectly have contributed loans to fixed and floating rate commercial mortgage-backed securitization transactions. RAIT and its affiliates, acting as sponsor and mortgage loan seller, securitized approximately $60,831,868, $96,296,175, $539,944,126 and $834,020,321 of multifamily and commercial mortgage loans in public and private offerings in calendar years 2011, 2012, 2013 and 2014, respectively. Key members of the RAIT management team were officers at JP Morgan Chase and Wachovia Bank and have been involved in the commercial mortgage securitization business since 1997.
RAIT and its affiliates generally act either as originator, mortgage loan seller and/or sponsor in the commercial mortgage securitizations in which they participate. In such securitizations, there may be co-sponsors and/or other mortgage loan sellers or originators. In such securitizations, the mortgage loans originated by RAIT or one of its affiliates are generally sold to a depositor, which in turn transfers such loans to an issuing entity, which issues commercial mortgage pass-through certificates or similar securities that are in whole or part backed by the cash flows from such mortgage loans. All of the Mortgage Loans to be sold by RAIT to the Depositor in connection with this securitization were originated by RAIT.
Neither RAIT nor any of its affiliates or subsidiaries will insure or guarantee distributions on the Certificates. The Certificateholders will have no rights or remedies against RAIT or any of its affiliates or subsidiaries for any losses or other claims in connection with the Certificates or the Mortgage Loans, except with respect to the repurchase and substitution obligations for material document defects or the material breaches of representations and warranties made by RAIT in the related Mortgage Loan Purchase Agreement, as described under “Description of the Mortgage Pool—Cures, Repurchases and Substitutions” in this prospectus supplement.
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Review of RAIT Mortgage Loans
Overview. RAIT has conducted a review of the RAIT Mortgage Loans in connection with the securitization described in this prospectus supplement. The review of the RAIT Mortgage Loans was performed by a team comprised of real estate and securitization professionals who are employees of RFT or one or more of its affiliates (the “RAIT Securitization Team”). The review procedures described below were employed with respect to all of the RAIT Mortgage Loans. No sampling procedures were used in the review process.
Database. To prepare for securitization, members of the RAIT Securitization Team created a database of loan-level and property-level information relating to each RAIT Mortgage Loan. The database was compiled from, among other sources, the related RAIT Mortgage Loan documents, appraisals, environmental assessment reports, property condition reports, seismic studies, zoning reports, insurance review summaries, borrower-supplied information (including, but not limited to, rent rolls, leases, operating statements and budgets) and information collected by the RAIT Securitization Team during the underwriting process. After origination of each RAIT Mortgage Loan, the RAIT Securitization Team updated the information in the database with respect to such RAIT Mortgage Loan based on updates from RAIT Partnership’s servicing group to loan payment status and escrows, updated operating statements, rent rolls and leasing activity, and information otherwise brought to the attention of the RAIT Securitization Team.
A data tape containing detailed information regarding each RAIT Mortgage Loan (the “RAIT Data Tape”) was created from the information in the database referred to in the prior paragraph. The RAIT Data Tape was used to provide the numerical information regarding the RAIT Mortgage Loans in this prospectus supplement.
Data Comparison and Recalculation. RAIT engaged a third-party accounting firm to perform certain data comparison and recalculation procedures, the nature, extent and timing of which were designed by RAIT, relating to information in this prospectus supplement regarding the RAIT Mortgage Loans. These procedures included:
· | comparing the information in the RAIT Data Tape against various source documents provided by RAIT that are described above under“—Database”; |
· | comparing numerical information regarding the RAIT Mortgage Loans and the related Mortgaged Properties disclosed in this prospectus supplement against the RAIT Data Tape; and |
· | recalculating certain percentages, ratios and other formulae relating to the RAIT Mortgage Loans disclosed in this prospectus supplement. |
Legal Review. RAIT engaged various law firms to conduct certain legal reviews of the RAIT Mortgage Loans for disclosure in this prospectus supplement. In anticipation of the securitization of each RAIT Mortgage Loan, origination counsel reviewed a form of securitization representations and warranties at origination and, if applicable, identified exceptions to those representations and warranties. In addition, origination counsel for the RAIT Mortgage Loans completed due diligence questionnaires with respect to the RAIT Mortgage Loans. RFT’s underwriting staff and in-house legal team performed a similar review of representations and warranties, and completed due diligence questionnaires. Outside legal counsel was also engaged in connection with this securitization to assist in the review of the RAIT Mortgage Loans. Such assistance included, among other things, (i) a review of RAIT’s asset summary reports for each RAIT Mortgage Loan, (ii) a review of a compilation of the exception reports to the representations and warranties referred to above relating to the RAIT Mortgage Loans, and (iii) a review of a compilation of the due diligence questionnaires relating to the RAIT Mortgage Loans.
Other Review Procedures. With respect to any material pending litigation related to the RAIT Mortgage Loans and of which RFT was aware at the origination of any RAIT Mortgage Loan, RFT requested updates from the related borrower, origination counsel and/or borrower’s litigation counsel.
Findings and Conclusions.Based on the foregoing review procedures, RAIT determined that the disclosure regarding the RAIT Mortgage Loans in this prospectus supplement is accurate in all material respects. RAIT also determined that the RAIT Mortgage Loans were originated in accordance with RAIT’s origination procedures and underwriting criteria. RAIT attributes to itself all findings and conclusions resulting from the foregoing review procedures.
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Repurchase Requests
RAIT files reports on Form ABS-15G, and most recently filed a Form ABS-15G on February 12, 2015. RAIT’s Central Index Key is 0001587045. RAIT Partnership, an affiliate of RAIT, files reports on Form ABS-15G, and most recently filed a Form ABS-15G on February 12, 2015. RAIT Partnership’s Central Index Key is 0001175134. With respect to the period from and including January 1, 2012 to and including March 31, 2015, RAIT and RAIT Partnership have no demand, repurchase or replacement history to report as required by Rule 15Ga-1 under the Exchange Act.
KGS-Alpha Real Estate Capital Markets, LLC
General
KGS-Alpha Real Estate Capital Markets, LLC, a Delaware limited liability company formed on August 29, 2013 (“KGS”), a Sponsor and an Originator, is wholly-owned by KGS Holdings, L.P., a Delaware limited partnership that was formed on June 4, 2010. KGS originates commercial real estate mortgage loans for the purpose of securitizing them in CMBS transactions. The executive offices of KGS are located at 601 Lexington Avenue, 44th Floor, New York, New York 10022.
Citibank, N.A., the Certificate Administrator and an affiliate of the Depositor and of CGMRC, provides warehouse financing to an affiliate of KGS through a repurchase facility. All of the KGS Mortgage Loans, with an aggregate principal balance of approximately $21,243,283 as of the Cut-off Date and representing approximately 2.9% of the Initial Pool Balance, are subject to that repurchase facility. Proceeds received by KGS in connection with the sale of the KGS Mortgage Loans to the Depositor will be applied, among other things, to reacquire the financed KGS Mortgage Loans and make payments to Citibank, N.A., as the repurchase agreement counterparty.
KGS originates commercial real estate mortgage loans with a general focus on stabilized, income-producing properties. All of the KGS Mortgage Loans being sold to the Depositor by KGS were originated by KGS. This is the third commercial mortgage securitization to which KGS is contributing commercial mortgage loans as an originator and the first commercial mortgage securitization in which KGS is a sponsor. The Mortgage Loans originated by KGS for securitization are secured by commercial, multifamily or manufactured housing properties. Neither KGS nor its affiliates act as master servicer of the commercial mortgage loans it contributes to securitizations. KGS may, from time to time, provide other types of financing including, but not limited to, bridge loans, mezzanine loans or subordinate mortgage loans. As of the Cut-off Date, the total amount of commercial mortgage loans originated and securitized by KGS is in excess of $51,602,500.
Neither KGS nor any of its affiliates will insure or guarantee distributions on the Certificates. The Certificateholders will have no rights or remedies against KGS for any losses or other claims in connection with the Certificates or the Mortgage Loans except in respect of the repurchase and substitution obligations for material document defects or material breaches of representations and warranties made by KGS in the applicable Mortgage Loan Purchase Agreement as described under “Description of the Mortgage Pool—Cures, Repurchases and Substitutions” in this prospectus supplement.
Review of KGS Mortgage Loans
Overview. KGS has conducted a review of each of the KGS Mortgage Loans in connection with the securitization described in this prospectus supplement. This review of the KGS Mortgage Loans was performed by a team comprised of real estate and securitization professionals who are employees of KGS and/or its affiliates (the “KGS Review Team”). The review procedures described below were employed with respect to all of the KGS Mortgage Loans. No sampling procedures were used in the review process. KGS is the Sponsor with respect to three (3) Mortgage Loans, which are identified on Annex A to this prospectus supplement.
Set forth below is a discussion of certain current general guidelines of KGS applicable with respect to KGS’s underwriting analysis of multifamily, manufactured housing and commercial real estate properties. All or a portion of the underwriting guidelines described below may not be applied exactly as described below at the time a particular asset is originated by KGS. See “—The Originators—KGS-Alpha Real Estate Capital Markets, LLC—Exceptions to Underwriting Criteria” in this prospectus supplement.
Database. To prepare for securitization, members of the KGS Review Team created and reviewed a database of loan-level and property-level information relating to the KGS Mortgage Loans. The database was
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compiled from, among other sources, the related Mortgage Loan documents, appraisals, environmental assessment reports, property condition reports, zoning reports, insurance review summaries, borrower-supplied information (including, but not limited to, rent rolls, leases, operating statements and budgets) and information collected by the KGS Review Team during the underwriting process. Prior to securitization of the KGS Mortgage Loans, the KGS Review Team may have updated the information in the database with respect to the KGS Mortgage Loans based on updates provided by the related servicer which may include information relating to loan payment status and escrows, updated operating statements, rent rolls and leasing activity, and information otherwise brought to the attention of the KGS Review Team, to the extent such updates were provided to, and deemed material by, the KGS Review Team. Such updates, if any, were not intended to be, and do not serve as, a re-underwriting of the KGS Mortgage Loans.
A data tape (the “KGS Data Tape”) containing detailed information regarding the KGS Mortgage Loans was created from the information in the database referred to in the prior paragraph. The KGS Data Tape was used to provide the numerical information regarding the KGS Mortgage Loans in this prospectus supplement.
Data Comparison and Recalculation. KGS engaged a third-party accounting firm to perform certain data comparison and recalculation procedures designed by KGS, relating to information in this prospectus supplement regarding the KGS Mortgage Loans. These procedures included:
· | comparing the information in the KGS Data Tape against various source documents provided by KGS; |
· | comparing numerical information regarding the KGS Mortgage Loans and the related Mortgaged Properties disclosed in this prospectus supplement against the information contained in the KGS Data Tape; and |
· | recalculating certain percentages, ratios and other formulas relating to the KGS Mortgage Loans disclosed in this prospectus supplement. |
Legal Review. KGS engaged legal counsel to conduct certain legal reviews of the KGS Mortgage Loans for disclosure in this prospectus supplement. In anticipation of the securitization described in this prospectus supplement, KGS’s origination counsel reviewed a form of securitization representations and warranties at origination and, if applicable, identified exceptions to those representations and warranties based on the review of the materials described in the following paragraph. Certain members of the KGS Review Team also performed a review of the representations and warranties.
Legal counsel was also engaged in connection with this securitization transaction to assist in the review of the KGS Mortgage Loans. Such assistance included, among other things (i) the review of the representations and warranties and any exceptions thereto relating to the KGS Mortgage Loans prepared by origination counsel, (ii) the review of, and assistance in the completion by the KGS Review Team of, a Due Diligence Questionnaire relating to the KGS Mortgage Loans and (iii) the review of certain provisions in the loan documents and post-closing summaries for certain KGS Mortgage Loans.
Other Review Procedures. The KGS Review Team, with the assistance of counsel engaged in connection with this securitization transaction, also generally reviewed each KGS Mortgage Loan to determine whether it materially deviated from the underwriting guidelines set forth under “—The Originators—KGS-Alpha Real Estate Capital Markets, LLC—Overview” below.
Findings and Conclusions. Based on the foregoing review procedures, KGS determined that the disclosure regarding the KGS Mortgage Loans in this prospectus supplement is accurate in all material respects. Except as described in “—The Originators—KGS-Alpha Real Estate Capital Markets, LLC—Exceptions to Underwriting Criteria” below, KGS has determined that the KGS Mortgage Loans were not originated with any material exceptions from KGS’s underwriting guidelines and procedures. KGS attributes to itself all findings and conclusions resulting from the foregoing review procedures.
Review Procedures in the Event of a Mortgage Loan Substitution. KGS will perform a review of any Mortgage Loan that it elects to substitute for a KGS Mortgage Loan in the pool in connection with a Material Breach or a Material Document Defect. KGS, and if appropriate its legal counsel, will review the Mortgage Loan documents and servicing history of the substitute mortgage loan to confirm it meets each of the criteria required under the terms of the related Mortgage Loan Purchase Agreement and the Pooling and Servicing Agreement (the
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“Qualification Criteria”). KGS will engage a third party accounting firm to compare the Qualification Criteria against the underlying source documentation to verify the accuracy of the review by KGS and to confirm any numerical and/or statistical information to be disclosed in any required filings under the Exchange Act. Legal counsel will also be engaged by KGS to render any tax opinion required in connection with the substitution.
Repurchase Requests
From the time KGS commenced operations in August of 2013 through May 31, 2015, KGS has not had and does not have any activity to report as required by Rule 15Ga-1 under the Exchange Act with respect to repurchase or replacement requests in connection with breaches of representations and warranties made by it as a sponsor of commercial mortgage securitizations. KGS Holdings files reports on Form ABS-15G on behalf of KGS and filed its initial Form ABS-15G on June 9, 2015. KGS Holdings Central Index Key is 0001499542.
Legal Proceedings
KGS is currently not subject to any material legal proceedings, the ultimate resolution of which would have a material adverse effect on its business or would be material to Certificateholders.
Compensation of the Sponsors
In connection with the offering and sale of the Certificates contemplated by this prospectus supplement, the Sponsors (including affiliates of the Sponsors) will be compensated for the sale of their respective Mortgage Loans in an amount equal to the excess, if any, of:
(a) the sum of any proceeds received from the sale of the Certificates to investors and the sale of servicing rights to Wells Fargo Bank, National Association for the master servicing of the Mortgage Loans and primary servicing of certain of the Serviced Loans, over
(b) the sum of the costs and expense of originating or acquiring the Mortgage Loans and the costs and expenses related to the issuance, offering and sale of the Certificates as described in this prospectus supplement.
The mortgage servicing rights were sold to the Master Servicer for a price based on the value of the Servicing Fee to be paid to the Master Servicer with respect to each Mortgage Loan and the value of the right to earn income on investments on amounts held by the Master Servicer with respect to the Mortgage Loans. The Master Servicer will also purchase the primary servicing rights for any Serviced Companion Loan.
The Depositor
Citigroup Commercial Mortgage Securities Inc. is the depositor with respect to the Issuing Entity (in such capacity, the “Depositor”). The Depositor is a special purpose corporation incorporated in the State of Delaware on July 17, 2003 for the purpose of engaging in the business of, among other things, acquiring and depositing mortgage loans in trusts in exchange for certificates evidencing interest in such trusts and selling or otherwise distributing such certificates, in addition to other related activities. The principal executive offices of the Depositor are located at 388 Greenwich Street, New York, New York 10013. The telephone number is (212) 816-6000.
The Depositor does not have, nor is it expected in the future to have, any significant assets and is not engaged in activities unrelated to the securitization of mortgage loans. The Depositor will not have any business operations other than securitizing mortgage loans and related activities.
The Depositor is an affiliate of CGMRC, a Sponsor and an Originator, an affiliate of Citibank, N.A., the Certificate Administrator, Certificate Registrar and paying agent, and an affiliate of Citigroup Global Markets Inc., one of the underwriters.
After establishing the Issuing Entity, the Depositor will have minimal ongoing duties with respect to the Certificates and the Mortgage Loans. The Depositor’s ongoing duties will include: (i) appointing a successor trustee or certificate administrator in the event of the removal of the Trustee or Certificate Administrator, (ii) paying any ongoing fees (such as surveillance fees) of the Rating Agencies, (iii) promptly delivering to the Certificate Administrator any document that comes into the Depositor’s possession that constitutes part of the Mortgage File or servicing file for any Mortgage Loan, (iv) upon discovery of a breach of any of the representations and
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warranties of the Master Servicer, the Special Servicer or the Operating Advisor which materially and adversely affects the interests of the Certificateholders, giving prompt written notice of such breach to the affected parties, (v) providing information in its possession with respect to the Certificates to the Certificate Administrator to the extent necessary to perform REMIC tax administration, (vi) indemnifying the Issuing Entity, the Trustee, the Certificate Administrator, the Operating Advisor, the Master Servicer and the Special Servicer for any loss, liability or reasonable expense (including, without limitation, reasonable attorneys’ fees and expenses) incurred by such parties arising from the Depositor’s willful misconduct, bad faith, fraud and/or negligence in the performance of its duties contained in the Pooling and Servicing Agreement or by reason of negligent disregard of its obligations and duties under the Pooling and Servicing Agreement, (vii) signing any annual report on Form 10-K, including the required certification in Form 10-K under the Sarbanes-Oxley Act of 2002, and any distribution reports on Form 10-D and Current Reports on Form 8-K required to be filed by the Issuing Entity and (viii) mailing the notice of a succession of the Trustee or the Certificate Administrator to all Certificateholders.
On the Closing Date, the Depositor will acquire the Mortgage Loans from each Sponsor and will simultaneously transfer the Mortgage Loans, without recourse, to the Trustee for the benefit of the Certificateholders. See “Transaction Participants—The Depositor”in the prospectus.
The Originators
Citigroup Global Markets Realty Corp., Goldman Sachs Mortgage Company, GS Commercial Real Estate LP, Rialto Mortgage Finance, LLC, RAIT Funding, LLC and KGS-Alpha Real Estate Capital Markets, LLC are referred to in this prospectus supplement as the “Originators”.
The information set forth in this prospectus supplement concerning the Originators and their underwriting standards has been provided by the Originators.
Citigroup Global Markets Realty Corp.
Overview. CGMRC’s commercial mortgage loans are primarily originated in accordance with the procedures and underwriting criteria described below. However, variations from these procedures and criteria may be implemented as a result of various conditions including each loan’s specific terms, the quality or location of the underlying real estate, the property’s tenancy profile, the background or financial strength of the borrower/sponsor or any other pertinent information deemed material by CGMRC. Therefore, this general description of CGMRC’s origination procedures and underwriting criteria is not intended as a representation that every commercial mortgage loan originated by it or on its behalf complies entirely with all criteria set forth below.
Process. The credit underwriting process for each CGMRC loan is performed by a deal team comprised of real estate professionals which typically includes an originator, an underwriter, a commercial closer and a third party due diligence provider operating under the review of CGMRC. This team conducts a thorough review of the related mortgaged property, which in most cases includes an examination of the following information, to the extent both applicable and available: historical operating statements, rent rolls, tenant leases, current and historical real estate tax information, insurance policies and/or schedules, and third party reports pertaining to appraisal/valuation, zoning, environmental status and physical condition/seismic condition/engineering (see “—
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Escrow Requirements”, “—Title Insurance Policy”, “—Property Insurance”, “—Third Party Reports—Appraisal”, “—Third Party Reports—Environmental Report” and “—Third Party Reports—Property Condition Report” below). In some cases (such as a property having a limited operating history or having been recently acquired by its current owner), historical operating statements may not be available. Rent rolls would not be examined for certain property types, such as hospitality properties or single tenant properties, and tenant leases would not be examined for certain property types, such as hospitality, self storage, multifamily and manufactured housing community properties.
A member of the CGMRC deal team or one of its agents performs an inspection of the property as well as a review of the surrounding market environment, including demand generators and competing properties (if any), in order to confirm tenancy information, assess the physical quality of the collateral, determine visibility and access characteristics, and evaluate the property’s competitiveness within its market.
The CGMRC deal team or one of its agents also performs a detailed review of the financial status, credit history, credit references and background of the borrower and certain key principals using financial statements, income tax returns, credit reports, criminal/background investigations, and specific searches for judgments, liens, bankruptcy and pending litigation. Circumstances may also warrant an examination of the financial strength and credit of key tenants as well as other factors that may impact the tenants’ ongoing occupancy or ability to pay rent.
After the compilation and review of all documentation and other relevant considerations, the deal team finalizes its detailed underwriting analysis of the property’s cash flow in accordance with CGMRC’s property-specific, cash flow underwriting guidelines. Determinations are also made regarding the implementation of appropriate loan terms to structure around risks, resulting in features such as ongoing escrows or up-front reserves, letters of credit, lockboxes/cash management agreements or guarantees. A complete credit committee package is prepared to summarize all of the above referenced information.
Credit Approval. All commercial mortgage loans must be presented to one or more credit committees that include senior real estate professionals among others. After a review of the credit committee package and a discussion of the loan, the committee may approve the loan as recommended or request additional due diligence, modify the terms, or reject the loan entirely.
Debt Service Coverage and LTV Requirements. CGMRC’s underwriting standards generally require a minimum debt service coverage ratio (DSCR) of 1.20x and a maximum loan-to-value ratio (LTV) of 80%. However these thresholds are guidelines and exceptions are permitted under the guidelines on the merits of each individual loan, such as reserves, letters of credit and/or guarantees and CGMRC’s assessment of the property’s future prospects. Property and loan information is not updated for securitization unless CGMRC determines that information in its possession has become stale.
Certain properties may also be encumbered by subordinate debt secured by such property and/or mezzanine debt secured by direct or indirect ownership interests in the borrower and when such mezzanine or subordinate debt is taken into account, may result in aggregate debt that does not conform to the aforementioned DSCR and LTV parameters.
Amortization Requirements. While CGMRC’s underwriting guidelines generally permit a maximum amortization period of 30 years, certain loans may provide for interest-only payments through maturity or for a portion of the loan term. If the loan entails only a partial interest-only period, the monthly debt service, annual debt service and DSCR set forth in this prospectus supplement and Annex A to this prospectus supplement reflect a calculation on the future (larger) amortizing loan payment. See “Description of the Mortgage Pool” in this prospectus supplement.
Escrow Requirements. CGMRC may require borrowers to fund escrows for taxes, insurance, capital expenditures and replacement reserves. In addition, CGMRC may identify certain risks that warrant additional escrows or holdbacks for items to be released to the borrower upon the satisfaction of certain conditions. Such escrows or holdbacks may cover tenant improvements/leasing commissions, deferred maintenance, environmental remediation or unfunded obligations, among other things. Springing escrows may also be structured for identified risks such as specific rollover exposure, to be triggered upon the non-renewal of one or more key tenants. In some cases, the borrower may be allowed to post a letter of credit or guaranty in lieu of a
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cash reserve, or provide periodic evidence of timely payment of a typical escrow item. Escrows are evaluated on a case-by-case basis and are not required for all CGMRC commercial mortgage loans.
Generally, CGMRC requires escrows as follows:
· | Taxes—An initial deposit and monthly escrow deposits equal to 1/12th of the annual property taxes (based on the most recent property assessment and the current millage rate) are typically required to satisfy all taxes and assessments, except that such escrows are not required in certain circumstances, including, but not limited to, (i) if there is an institutional sponsor or the sponsor is a high net-worth individual or (ii) if and to the extent that a single or major tenant (which may be a ground tenant) at the related mortgaged property is required to pay taxes directly. |
· | Insurance—An initial deposit and monthly escrow deposits equal to 1/12th of the annual property insurance premium are typically required to pay all insurance premiums, except that such escrows are not required in certain circumstances, including, but not limited to, (i) if the related borrower maintains a blanket insurance policy, (ii) if and to the extent that a single or major tenant (which may be a ground tenant) at the related mortgaged property is obligated to maintain the insurance or is permitted to self-insure, or (iii) if and to the extent that another third party unrelated to the borrower (such as a condominium board, if applicable) is obligated to maintain the insurance. |
· | Replacement Reserves—Replacement reserves are generally calculated in accordance with the expected useful life of the components of the mortgaged property during the term of the mortgage loan. Annual replacement reserves are generally underwritten to the suggested replacement reserve amount from an independent, third-party property condition or engineering report, or to certain minimum requirements depending on the property type, except that such escrows are not required in certain circumstances, including, but not limited to, if and to the extent that a single or major tenant (which may be a ground tenant) at the related mortgaged property is responsible for all repairs and maintenance, including those required with respect to the roof and structure of the improvements. |
· | Tenant Improvement / Leasing Commissions—In the case of retail, office and industrial properties, a tenant improvement / leasing commission reserve may be required to be funded either at loan origination and/or during the term of the mortgage loan to cover anticipated leasing commissions or tenant improvement costs that might be associated with re-leasing certain space involving major tenants, except that such escrows are not required in certain circumstances, including, but not limited to, (i) if the tenant’s lease extends beyond the loan term or (ii) if the rent for the space in question is considered below market. |
· | Deferred Maintenance—A deferred maintenance reserve may be required to be funded at loan origination in an amount equal to 125% of the estimated cost of material immediate repairs or replacements identified in the property condition report, except that such escrows are not required in certain circumstances, including, but not limited to, (i) if the sponsor of the borrower delivers a guarantee to complete the immediate repairs in a specified amount of time, (ii) if the deferred maintenance amount does not materially impact the related mortgaged property’s function, performance or value or (iii) if a single or major tenant (which may be a ground tenant) at the related mortgaged property is responsible for the repairs. |
· | Environmental Remediation—An environmental remediation reserve may be required to be funded at loan origination in an amount equal to 100% to 125% of the estimated remediation cost identified in the environmental report, except that such escrows are not required in certain circumstances, including, but not limited to, (i) if the sponsor of the borrower delivers a guarantee wherein it agrees to take responsibility and pay for the identified environmental issues, (ii) if environmental insurance is obtained or already in place or (iii) if a third party unrelated to the borrower is identified as the responsible party. |
For a description of the escrows collected with respect to the CGMRC Mortgage Loans, please see Annex A to this prospectus supplement.
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Title Insurance Policy. The borrower is required to provide, and CGMRC or its counsel typically will review, a title insurance policy for each property. The provisions of the title insurance policy are required to comply with the Sponsor representation and warranty set forth in paragraph (6) on Annex E-1 to this prospectus supplement without any exception that CGMRC deems material.
Property Insurance. CGMRC requires the borrower to provide, or authorizes the borrower to rely on a tenant or other third party to obtain, insurance policies meeting the requirements set forth in the Sponsor representations and warranties in paragraphs (16) and (29) on Annex E-1 to this prospectus supplement without any exceptions that CGMRC deems material (other than with respect to deductibles and allowing a tenant to self-insure).
Third Party Reports. In addition to or as part of applicable origination guidelines or reviews described above, in the course of originating the CGMRC Mortgage Loans, CGMRC generally considered the results of third party reports as described below. In many instances, however, one or more provisions of the guidelines were waived or modified in light of the circumstances of the relevant loan or property.
· | Appraisal. CGMRC obtains an appraisal meeting the requirements described in the Sponsor representation and warranty set forth in paragraph (41) on Annex E-1 to this prospectus supplement. In addition, the appraisal (or a separate letter) includes a statement by the appraiser that the guidelines in Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, as amended, were followed in preparing the appraisal. |
· | Environmental Report. CGMRC generally obtains a Phase I site assessment or an update of a previously obtained site assessment for each mortgaged property prepared by an environmental firm approved by CGMRC. CGMRC or its designated agent typically reviews the Phase I site assessment to verify the presence or absence of potential adverse environmental conditions. In cases in which the Phase I site assessment identifies any such conditions, CGMRC generally requires that the condition be addressed in a manner that complies with the Sponsor representation and warranty set forth in paragraph (40) on Annex E-1 to this prospectus supplement without any exception that CGMRC deems material. |
· | Property Condition Report. CGMRC generally obtains a current property condition report (a “PCR”) for each mortgaged property prepared by a structural engineering firm approved by CGMRC. CGMRC or an agent typically reviews the PCR to determine the physical condition of the property and to determine the anticipated costs of necessary repair, replacement and major maintenance or capital expenditure over the term of the mortgage loan. In cases in which the PCR identifies an immediate need for material repairs or replacements with an anticipated cost that is over a certain minimum threshold or percentage of loan balance, CGMRC often requires that funds be put in escrow at the time of origination of the mortgage loan to complete such repairs or replacements or obtains a guarantee from a sponsor of the borrower in lieu of reserves. See “—Escrow Requirements” above. |
Servicing. Interim servicing for all CGMRC loans prior to securitization is typically performed by a nationally recognized rated third party interim servicer. In addition, primary servicing is occasionally retained by certain qualified mortgage brokerage firms under established sub-servicing agreements with CGMRC, which firms may continue primary servicing certain loans following the securitization closing date. Otherwise, servicing responsibilities are transferred from the interim servicer to the master servicer of the securitization trust (and a primary servicer when applicable) at closing of the securitization. From time to time, the interim servicer may retain primary servicing.
Exceptions to Underwriting Criteria. Except as disclosed in the following two paragraphs, none of the CGMRC Mortgage Loans have exceptions to the related underwriting criteria.
With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Oklahoma Walmart Portfolio, representing approximately 2.1% of the Initial Pool Balance, the DSCR of 1.17x falls below the minimum debt service coverage ratio of 1.20x generally required by CGMRC’s underwriting standards. However, the Mortgaged Properties are both single-tenant retail properties occupied by Wal-Mart pursuant to long-term leases that are not scheduled to expire until January 2035. Based on the foregoing factors and CGMRC’s evaluation of the quality of the portfolio of Mortgaged Properties, CGMRC approved inclusion of the Mortgage Loan into this securitization transaction.
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With respect to the Mortgage Loan secured by the Mortgaged Property identified on Annex A to this prospectus supplement as Kohl’s Tallahassee FL, representing approximately 0.6% of the Initial Pool Balance, the DSCR of 1.18x falls below the minimum debt service coverage ratio of 1.20x generally required by CGMRC’s underwriting standards. However, the Mortgaged Property is a single-tenant retail property subject to a long-term lease that is not scheduled to expire until March 2028. Furthermore, the Mortgage Loan is scheduled to amortize based on a 20-year amortization schedule, and the DSCR for the Mortgage Loan would have met the minimum debt service coverage ratio (DSCR) of 1.20x generally required by CGMRC’s underwriting standards if the Mortgage Loan were scheduled to amortize based on a 25-year or 30-year amortization schedule. Based on the foregoing factors and CGMRC’s evaluation of the quality of the Mortgaged Property, CGMRC approved inclusion of the Mortgage Loan into this securitization transaction.
The Goldman Originators
Overview. GSMC and GS CRE, each an Originator, are affiliated with each other and with Goldman, Sachs & Co., one of the underwriters. GSMC and GS CRE are referred to as the ”Goldman Originators” in this prospectus supplement.
The primary business of each Goldman Originator is the underwriting and origination, either by itself or together with another originator, of mortgage loans secured by commercial or multifamily properties. The commercial mortgage loans originated by each Goldman Originator include both fixed and floating rate commercial mortgage loans and such commercial mortgage loans are often included in both public and private securitizations. Many of the commercial mortgage loans originated by GS CRE are acquired by GSMC and sold to securitizations in which GSMC acts as sponsor and/or loan seller.
Fixed Rate Commercial Mortgage Loans(1)
Year | Total Goldman Originator | Total Goldman Originator | ||
2014 | $2.9 billion | $3.1 billion | ||
2013 | $5.0 billion | $5.3 billion | ||
2012 | $5.6 billion | $4.6 billion | ||
2011 | $2.3 billion | $2.2 billion | ||
2010 | $1.6 billion | $1.1 billion | ||
2009 | $400 million | $400 million | ||
Floating Rate Commercial Mortgage Loans(1)
Year | Total Goldman Originator | Total Goldman Originator | ||
2014 | $3.2 billion | $2.0 billion | ||
2013 | $777 million | $1.3 billion | ||
2012 | $1.9 billion | $0 | ||
2011 | $140 million | $0 | ||
2010 | $0 | $0 | ||
2009 | $40 million | $0 |
(1) Represents origination for all Goldman Originators and affiliates of Goldman Originators originating commercial mortgage loans.
Origination and Underwriting Process. Each Goldman Originator’s commercial mortgage loans are primarily originated in accordance with the origination procedures and underwriting criteria described below. However, variations from these procedures and criteria may occur as a result of various conditions including each loan’s specific terms, the quality or location of the underlying real estate, the property’s tenancy profile, the background or financial strength of the borrower/sponsor, or any other pertinent information deemed material by the applicable Goldman Originator. Therefore, this general description of the Goldman Originators’ origination procedures and underwriting criteria is not intended as a representation that every commercial mortgage loan originated by it complies entirely with all procedures and criteria set forth below. For important information about the circumstances that have affected the underwriting of a GSMC Mortgage Loan in the mortgage pool, see “—Exceptions to Underwriting Criteria” below and “Exceptions to Sponsor Representations and Warranties” in Annex E-2 to this prospectus supplement.
The underwriting process for each mortgage loan originated by a Goldman Originator is performed by an origination team comprised of real estate professionals which typically includes an originator, analyst, loan officer and commercial closer. This team conducts a review of the related mortgaged property, which typically includes
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an examination of historical operating statements (if available), rent rolls, certain tenant leases, current and historical real estate tax information, insurance policies and/or schedules, and third-party reports pertaining to appraisal/valuation, zoning, environmental status and physical condition/seismic/engineering. In certain cases, the Goldman Originator may engage an independent third party due diligence provider, pursuant to a program of specified procedures, to assist in the underwriting and preparation of analyses required by such procedures, subject to the oversight and ultimate review and approval by the Goldman Originator origination team.
A member of the applicable Goldman Originator origination team performs or engages a third party to perform an inspection of the property in order to assess the physical quality of the collateral, confirm tenancy, and determine visibility and accessibility of the property as well as proximity to major thoroughfares, transportation centers, employment sources, retail areas, educational facilities and recreational areas. Such site inspections are also generally used to assess the submarket in which the property is located and to evaluate the property’s competitiveness within its market.
The applicable Goldman Originator origination team also performs a review of the financial status, credit history and background of the borrower and certain key principals of the borrower. Among the items generally reviewed are financial statements, independent credit reports, criminal/background investigations, and specific searches in select jurisdictions for judgments, liens, bankruptcy and pending litigation.
After the compilation and review of all documentation and other relevant considerations, the origination team finalizes its underwriting analysis of the property’s cash flow in accordance with the property specific cash flow underwriting guidelines of the applicable Goldman Originator. Determinations are also made regarding the implementation of appropriate loan terms to structure around risks, resulting in features such as ongoing escrows or up front reserves, letters of credit, lockboxes/cash management agreements or guarantees. A complete credit committee package is prepared to summarize all of the above referenced information.
All commercial mortgage loans must be presented to one or more credit committees which consist of senior real estate professionals, among others. After a review of the credit committee package and a discussion of the loan, the committee may approve the loan as recommended or request additional due diligence, modify the terms, or reject the loan entirely.
Each Goldman Originator’s underwriting guidelines generally require that a mortgage loan have, at origination, a minimum debt service coverage ratio of 1.20x and maximum loan-to-value ratio of 80%. However these thresholds are guidelines and exceptions may be made on the merits of each individual loan taking into account such factors as reserves, letters of credit and/or guarantees, the applicable Goldman Originator’s judgment of the property and/or market performance in the future.
Certain properties may also be encumbered by, or otherwise support payments on, subordinate debt and/or mezzanine debt secured by direct or indirect ownership interests in the borrower. It is possible that a Goldman Originator or an affiliate will be a lender on that additional debt, and may either sell such debt to an unaffiliated third party or hold it in inventory. When such additional debt is taken into account, the aggregate debt may not conform to the aforementioned debt service coverage ratio and loan-to-value ratio parameters.
Each Goldman Originator may require borrowers to fund various escrows for taxes, insurance, capital expenses and replacement reserves. In addition, each Goldman Originator may identify certain risks that warrant additional escrows or holdbacks for items such as leasing-related matters, deferred maintenance, environmental remediation or unfunded obligations, which escrows or holdbacks would be released upon satisfaction of the applicable conditions. Springing escrows may also be structured for identified risks such as specific rollover exposure, to be triggered upon the non-renewal of one or more key tenants. In some cases, the borrower may be allowed to post a letter of credit or guaranty in lieu of a cash reserve, or provide periodic evidence of timely payment of a typical escrow item. Escrows are evaluated on a case-by-case basis and are not required for all commercial mortgage loans originated by the Goldman Originators.
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Generally, the required escrows for GSMC Mortgage Loans are as follows:
· | Taxes—An initial deposit and monthly escrow deposits equal to 1/12th of the annual property taxes (based on the most recent property assessment and the current millage rate) are typically required to satisfy all taxes and assessments, except that such escrows are not required in certain circumstances, including, but not limited to, (i) if there is an institutional or high net-worth individual property sponsor or (ii) if the related mortgaged property is a single tenant property in which the related tenant is required to pay taxes directly. |
· | Insurance—An initial deposit and monthly escrow deposits equal to 1/12th of the annual property insurance premium are typically required to pay all insurance premiums, except that such escrows are not required in certain circumstances, including, but not limited to, (i) if the related borrower maintains a blanket insurance policy or (ii) if the related mortgaged property is a single tenant property and the related tenant is required to obtain insurance directly or self-insures. |
· | Replacement Reserves—Replacement reserves are generally calculated in accordance with the expected useful life of the components of the property during the term of the mortgage loan. Annual replacement reserves are generally underwritten to the suggested replacement reserve amount from an independent, third-party property condition or engineering report, or to certain minimum requirements by property type, except that such escrows are not required in certain circumstances, including, but not limited to, if the related mortgaged property is a single tenant property and the related tenant is responsible for all repairs and maintenance, including those required with respect to the roof and improvement structure. |
· | Tenant Improvement / Leasing Commissions—Tenant improvement / leasing commission reserves may be required to be funded either at loan origination and/or during the related mortgage loan term to cover certain anticipated leasing commissions or tenant improvement costs which might be associated with re-leasing the space, except that such escrows are not required in certain circumstances, including, but not limited to, (i) if the related mortgaged property is a single tenant property and the related tenant’s lease extends beyond the loan term or (ii) where rent at the related mortgaged property is considered below market. |
· | Deferred Maintenance—A deferred maintenance reserve may be required to be funded at loan origination in an amount equal to 100% to 125% of the estimated cost of material immediate repairs or replacements identified in the property condition or engineering report, except that such escrows are not required in certain circumstances, including, but not limited to, (i) the sponsor of the borrower delivers a guarantee to complete the immediate repairs in a specified amount of time, (ii) the deferred maintenance amount does not materially impact the function, performance or value of the property or (iii) if the related mortgaged property is a single tenant property the tenant is responsible for the repairs. |
· | Environmental Remediation—An environmental remediation reserve may be required at loan origination in an amount equal to 100% to 125% of the estimated remediation cost identified in the environmental report, except that such escrows are not required in certain circumstances, including, but not limited to, (i) the sponsor of the borrower delivers a guarantee agreeing to take responsibility and pay for the identified environmental issues or (ii) environmental insurance is obtained or already in place. |
For a description of the escrows collected with respect to the GSMC Mortgage Loans, please see Annex A to this prospectus supplement.
Each Goldman Originator and its origination counsel will generally examine whether the use and occupancy of the property is in material compliance with zoning, land-use, building rules, regulations and orders then applicable to that property. Evidence of this compliance may be in the form of one or more of the following: legal opinions, surveys, recorded documents, temporary or permanent certificates of occupancy, letters from government officials or agencies, title insurance endorsements, engineering or consulting reports, zoning reports and/or representations by the related borrower. In some cases, a mortgaged property may constitute a legal non-conforming use or structure. In such cases, each Goldman Originator may require an endorsement to the title
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insurance policy and/or the acquisition of law and ordinance coverage in the casualty insurance policy with respect to the particular non-conformity unless it determines that: (i) the non-conformity should not have a material adverse effect on the ability of the borrower to rebuild; or (ii) if the improvements are rebuilt in accordance with currently applicable law, the value and performance of the property would be acceptable; or (iii) any major casualty that would prevent rebuilding has a sufficiently remote likelihood of occurring; or (iv) a cash reserve, a letter of credit or an agreement imposing recourse liability from a principal of the borrower is provided to cover losses.
The borrower is required to provide, and each Goldman Originator or its origination counsel typically will review, a title insurance policy for each property. The title insurance policies provided typically must meet the following requirements: (i) written by a title insurer licensed to do business in the jurisdiction where the mortgaged property is located, (ii) in an amount at least equal to the original principal balance of the mortgage loan, (iii) protection and benefits run to the mortgagee and its successors and assigns, (iv) written on an American Land Title Association form or equivalent policy promulgated in the jurisdiction where the mortgaged property is located and (v) if a survey was prepared, the legal description of the mortgaged property in the title policy conforms to that shown on the survey.
Except in certain instances where credit rated tenants are required to obtain insurance or may self-insure, each Goldman Originator typically requires that the related mortgaged property be insured by a hazard insurance policy with a customary deductible and in an amount at least equal to the lesser (x) of the outstanding principal balance of the mortgage loan and (y) 100% of the full insurable replacement cost of the improvements located on the property. If applicable, the policy contains appropriate endorsements to avoid the application of coinsurance and does not permit reduction in insurance proceeds for depreciation, except that the policy may permit a deduction for depreciation in connection with a cash settlement after a casualty if the insurance proceeds are not being applied to rebuild or repair the damaged improvements.
Flood insurance, if available, must be in effect for any mortgaged property that at the time of origination included material improvements in any area identified in the Federal Register by the Federal Emergency Management Agency as a special flood hazard area. The flood insurance policy must meet the requirements of the then-current guidelines of the Federal Insurance Administration, be provided by a generally acceptable insurance carrier and be in an amount representing coverage not less than the least of: (i) the outstanding principal balance of the mortgage loan, (ii) the full insurable value of the property and (iii) the maximum amount of insurance available under the National Flood Insurance Act of 1968, except in some cases where self-insurance is permitted.
The standard form of hazard insurance policy typically covers physical damage or destruction of the improvements on the mortgaged property caused by fire, lightning, explosion, smoke, windstorm and hail, riot or strike and civil commotion. The policies may contain some conditions and exclusions to coverage, including exclusions related to acts of terrorism. Generally, each of the mortgage loans requires that the related property have coverage for terrorism or terrorist acts, if such coverage is available at commercially reasonable rates. In some cases, there is a cap on the amount that the related borrower will be required to expend on terrorism insurance.
Each mortgage typically also requires the borrower to maintain comprehensive general liability insurance against claims for personal and bodily injury, death or property damage occurring on, in or about the property in an amount customarily required by institutional lenders.
Each mortgage typically further requires the related borrower to maintain business interruption or rent loss insurance in an amount not less than 100% of the projected rental income from the related property for not less than twelve months.
Although properties are typically not insured for earthquake risk, a borrower will be required to obtain earthquake insurance if the seismic report indicates that the PML or SEL is greater than 20%.
In the course of originating their respective Mortgage Loans, the Goldman Originators generally considered the results of third party reports as described below:
· | Appraisal—Each Goldman Originator obtains an appraisal or an update of an existing appraisal for each mortgaged property prepared by an appraisal firm approved in accordance with the applicable |
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GoldmanOriginator’s internal documented appraisal policy. Each Goldman Originator origination team and a third party consultant engaged by the Goldman Originator typically reviews the appraisal. All appraisals are conducted by an independent appraiser that is state certified, an appraiser belonging to the Appraisal Institute, a member association of professional real estate appraisers, or an otherwise qualified appraiser. All appraisals are conducted in accordance with the Uniform Standards of Professional Appraisal Practices. In addition, the appraisal report (or a separate letter) includes a statement by the appraiser that the guidelines in Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, as amended, were followed in preparing the appraisal. |
· | Environmental Report—Each Goldman Originator obtains a Phase I site assessment or an update of a previously obtained site assessment for each mortgaged property prepared by an environmental firm approved by the applicable Goldman Originator. In certain cases, the borrower may have obtained the Phase I site assessment, and the assessment is then re-addressed to the Goldman Originator. Each Goldman Originator origination team and a third party environmental consultant engaged by the Goldman Originator or the borrower typically reviews the Phase I site assessment to verify the presence or absence of potential adverse environmental conditions. Furthermore, an environmental assessment conducted at any particular real property collateral will not necessarily cover all potential environmental issues. For example, an analysis for radon, lead-based paint, mold and lead in drinking water will usually be conducted only at multifamily rental properties and only when the Goldman Originator or the environmental consultant believes that such an analysis is warranted under the circumstances. In cases in which the Phase I site assessment identifies any potential adverse environmental conditions and no third party is identified as responsible for such condition, or the condition has not otherwise been satisfactorily mitigated, the Goldman Originator generally requires additional environmental testing, such as a Phase II environmental assessment on the related mortgaged property, an environmental insurance policy, the borrower to conduct remediation activities or to establish an operations and maintenance plan, or to place funds in escrow to be used to address any required remediation. |
· | Physical Condition Report—Each Goldman Originator obtains a physical condition report (“PCR”) or an update of a previously obtained PCR for each mortgaged property prepared by a structural engineering firm approved by the applicable Goldman Originator to assess the structure, exterior walls, roofing, interior structure and/or mechanical and electrical systems. In certain cases, the borrower may have obtained the PCR, and the PCR is then re-addressed to the Goldman Originator. Each Goldman Originator and a third party structural consultant engaged by the Goldman Originator or the borrower typically reviews the PCR to determine the physical condition of the property, and to determine the anticipated costs of necessary repair, replacement and major maintenance or capital expenditure over the term of the mortgage loan. In cases in which the PCR identifies an immediate need for material repairs or replacements with an anticipated cost that is over a certain minimum threshold or percentage of loan balance, the Goldman Originator generally requires that funds be put in escrow at the time of origination of the mortgage loan to complete such repairs or replacements or obtains a guarantee from a sponsor of the borrower in lieu of reserves. |
· | Seismic—Each Goldman Originator generally obtains a seismic report or an update of a previously obtained seismic report for all mortgaged properties located in seismic zone 3 or 4 to assess probable maximum loss (“PML”) or scenario expected loss (“SEL”) for the related mortgaged property. In certain cases, the borrower may have obtained the seismic report and the seismic report is then re-addressed to the Goldman Originator. |
Exceptions to Underwriting Criteria. With respect to the Mortgage Loan secured by the portfolio of Mortgaged Properties identified on Annex A to this prospectus supplement as Castroville Industrial Portfolio, representing approximately 0.7% of the Initial Pool Balance, the seismic report for the Mortgaged Property identified on Annex A to this prospectus supplement as 11145 and 11165 Commercial Parkway concluded that the weighted average scenario expected loss for such Mortgaged Property would equal approximately 20.6% of the amount of the replacement costs of the improvements. In lieu of earthquake insurance, a reserve was established at origination of the Mortgage Loan in the amount of $37,500, equal to 125% of the expected amount needed to retrofit the building to lower the scenario expected loss to less than 20%. The borrower has nine months from origination of the Mortgage Loan to complete the upgrades and confirm through a seismic assessment that the scenario expected loss is less than 20%. In the event these requirements have not been met within the given timeframe,
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the borrower will be required to obtain earthquake insurance. If the borrower fails to obtain earthquake insurance in accordance with the foregoing, the lender may place such insurance for the improvements. Based on the foregoing factors and GSMC’s evaluation of the quality of the Mortgaged Property, GSMC approved inclusion of the Mortgage Loan into this securitization transaction.
Servicing. Interim servicing for some of the loans originated by a Goldman Originator prior to securitization is typically performed by an interim servicer that is unaffiliated with the Goldman Originators. Additionally, primary servicing may occasionally be retained by certain qualified mortgage brokerage firms under established sub-servicing agreements with the applicable Goldman Originator, which may be retained post-securitization including the applicable fees. Otherwise, servicing responsibilities are transferred from the unaffiliated interim servicer to the master servicer of the securitization trust (and a primary servicer when applicable) at closing of the securitization.
Rialto Mortgage Finance, LLC
Rialto’s Underwriting Standards and Loan Analysis
Overview. Rialto is the Sponsor with respect to nine (9) Mortgage Loans. Rialto or an affiliate originated each of the Rialto Mortgage Loans being deposited into the securitization described in this prospectus supplement. Generally, Rialto performed an underwriting analysis with respect to each Mortgage Loan applicant and the related Mortgaged Property.
Set forth below is a discussion of certain current general guidelines of Rialto generally applicable with respect to Rialto’s underwriting analysis of multifamily and commercial real estate properties which serve as the direct or indirect source of repayment for commercial real estate debt originated by Rialto. All or a portion of the underwriting guidelines described below may not be applied exactly as described below at the time a particular asset is originated by Rialto.
Process and Loan Analysis. The underwriting process for each Rialto Mortgage Loan is performed by a transaction team comprised of real estate professionals that typically includes a loan originator and an underwriter subject to oversight by the members of the management team of Rialto. This team conducts a review of the related real property, which typically includes an examination of some or all of the following information, among other things, to the extent applicable and available: historical operating statements, rent rolls, certain tenant leases, real estate tax information, insurance policies and/or schedules and third party reports pertaining to appraisal, physical condition and environmental status. Each applicable report is reviewed for acceptability by Rialto or a third-party reviewer. The results of these reviews are incorporated into Rialto’s underwriting analysis. In some cases, certain of these documents may not be required or may not be reviewed due to the nature of the related real property. For instance, historical operating statements may not be available with respect to real property with limited operating history or that has been recently acquired by its current owner. In addition, rent rolls would not be examined for certain property types (e.g., hospitality properties), and executed tenant leases would not be examined for certain property types (e.g., hospitality, self-storage, multifamily and manufactured housing community properties) although the forms of leases would typically be reviewed for certain of these property types.
Rialto also performs an underwriting analysis with respect to the borrower under each asset it originates. The underwriting analysis of the borrower may include a review of third-party credit reports and reports resulting from judgment, lien or bankruptcy searches. Borrowers are generally required to be single purpose entities (although exceptions may be made from time to time on a case-by-case basis) and, in some cases, other structural requirements may be imposed on the borrower which are intended to reduce the likelihood of the borrower becoming involved in a bankruptcy proceeding; however, there can be no assurance that any of these structural requirements will prevent a particular borrower from becoming involved in a bankruptcy proceeding.
After the compilation and review of all applicable documentation and other relevant considerations, the transaction team finalizes its detailed underwriting analysis of the real property’s cash flow in a manner generally consistent with Rialto’s underwriting guidelines. Determinations are also made regarding the implementation of appropriate transaction terms to address certain risks, which may result in the recommendation of certain additional structural features. A credit committee memorandum is prepared which summarizes the above referenced information and which is circulated to the credit committee for review.
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Credit Approval. All assets originated by Rialto must be approved by one or more specified internal committees. After a review of the credit committee package and a discussion of the asset, a committee may approve a transaction as recommended, request additional due diligence, modify the transaction terms or decline a transaction entirely.
Debt Service Coverage Ratio. In connection with the origination of an asset, Rialto will analyze whether cash flow expected to be derived from the related real property will be sufficient to make the required payments under that transaction over its expected term, taking into account, among other things, revenues and expenses for, and other debt currently secured directly or indirectly by, or that in the future may be secured directly or indirectly by, the related real property. The debt service coverage ratio is an important measure of the likelihood of default on a particular asset. In general, the debt service coverage ratio at any given time is the ratio of—
· | the amount of income, net of expenses and required reserves, derived or expected to be derived from the related real property for a given period, to |
· | the scheduled payments of principal and interest during that given period on the subject asset and any other loans that are secured by liens of senior or equal priority on, or otherwise have a senior or equal entitlement to be repaid from the income generated by, the related real property. |
However, the amount described in the first bullet of the preceding sentence is often a highly subjective number based on a variety of assumptions regarding, and adjustments to, revenues and expenses with respect to the related real property. Accordingly, based on such subjective assumptions and analysis, there can be no assurance that the underwriting analysis of any particular asset will conform to the foregoing in every respect or to any similar analysis which may be performed by other persons or entities. For example, when calculating the debt service coverage ratio for a particular asset, Rialto may utilize net cash flow that was calculated based on assumptions regarding projected rental income, expenses and/or occupancy. There is no assurance that such assumptions made with respect to any asset or the related real property will, in fact, be consistent with actual property performance.
Generally, the debt service coverage ratio for assets originated by Rialto, calculated as described above, will be subject to a minimum standard at origination (generally equal to or greater than 1.20x); however, exceptions may be made when consideration is given to circumstances particular to the asset, the related real property, the associated loan-to-value ratio (as described below), reserves or other factors. For example, Rialto may originate an asset with a debt service coverage ratio below the minimum standard at origination based on, among other things, the amortization features of the overall debt structure, the type of tenants and leases at the related real property, the taking of additional collateral such as reserves, letters of credit and/or guarantees, the profile of the borrower and its owners, Rialto’s judgment of improved property and/or market performance in the future and/or other relevant factors.
Loan-to-Value Ratio. Rialto also looks at the loan-to-value ratio of a prospective investment related to multifamily or commercial real estate as one of the factors it takes into consideration in evaluating the likelihood of recovery if a property is liquidated following a default. In general, the loan-to-value ratio of an asset related to multifamily or commercial real estate at any given time is the ratio, expressed as a percentage, of:
· | the then outstanding principal balance of the asset and any other loans that are secured (directly or indirectly) by liens of senior or equal priority on the related real property, to |
· | the estimated value of the related real property based on an appraisal, a cash flow analysis, a recent sales price or another method or benchmark of valuation. |
Generally, the loan-to-value ratio for assets originated by Rialto, calculated as described above, will be subject to a maximum standard at origination (generally less than or equal to 80%); however, exceptions may be made when consideration is given to circumstances particular to the asset, the related real property, debt service coverage, reserves or other factors. For example, Rialto may originate a multifamily or commercial real estate loan with a loan-to-value ratio above the maximum standard at origination based on, among other things, the amortization features of the overall debt structure, the type of tenants and leases at the related real property, the taking of additional collateral such as reserves, letters of credit and/or guarantees, the profile of the borrower and its owners, Rialto’s judgment of improved property and/or market performance in the future and/or other relevant factors.
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Additional Debt. When underwriting an asset, Rialto will take into account whether the related real property and/or direct or indirect interest in a related borrower are encumbered by additional debt and will analyze the likely effect of that additional debt on repayment of the subject asset. It is possible that Rialto or an affiliate will be the lender on that additional debt, and may either sell such debt to an unaffiliated third party or hold it for investment or future sale.
The debt service coverage ratios at origination described above under “—Debt Service Coverage Ratio” and the loan-to-value ratios at origination described above under “—Loan-to-Value Ratio” may be significantly below the minimum standard and/or significantly above the maximum standard, respectively, when calculated taking into account the existence of additional debt secured directly or indirectly by equity interests in the related borrower.
Assessments of Property Condition. As part of the origination and underwriting process, Rialto will analyze the condition of the real property for a prospective asset. To aid in that analysis, Rialto may, subject to certain exceptions, inspect or retain a third party to inspect the property which, depending on the property type, such inspections generally include an evaluation of one or more of the following: functionality, design, attractiveness, visibility and accessibility of the property as well as proximity to major thoroughfares, transportation centers, employment sources, retail areas, educational facilities and recreational areas and generally assess the submarket in which the property is located, which may include evaluating competitive or comparable properties and will in most cases obtain the property reports described below.
Appraisal Report. Rialto will in most cases obtain an appraisal or an update of an existing appraisal from an independent appraiser that is state certified, belonging to the Appraisal Institute, a membership association of professional real estate appraisers, or an otherwise qualified appraiser. The appraisal reports are conducted in accordance with the Uniform Standards of Professional Appraisal Practices and the appraisal report (or a separate letter accompanying the report) will include a statement by the appraiser that the guidelines in Title XI of the Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended, were followed in preparing the appraisal report.
Environmental Report. Rialto requires that an environmental consultant prepare a Phase I environmental report or that an update of a prior environmental report, a transaction screen or a desktop review is prepared with respect to the real property related to the asset. Alternatively, Rialto may forego an environmental report in limited circumstances, such as when it has obtained the benefits of an environmental insurance policy or an environmental guarantee. Depending on the findings of the initial environmental report, Rialto may require additional record searches or environmental testing, such as a Phase II environmental report with respect to the subject real property. In certain cases where an environmental report discloses the existence of, or potential for, adverse environmental conditions, including as a result of the activities of identified tenants, adjacent property owners or previous owners of the subject real property, the related borrower may be required to establish operations and maintenance plans, monitor the real property, abate or remediate the condition and/or provide additional security such as letters of credit, reserves or environmental insurance policies.
Engineering Report. Rialto generally requires that an engineering firm inspect the real property related to the asset to assess and prepare a report regarding the structure, exterior walls, roofing, interior structure, mechanical systems and/or electrical systems. In some cases, engineering reports are based on, and limited to, information available through visual inspection. Rialto will consider the engineering report in connection with determining whether to address any recommended repairs, corrections or replacements in connection with origination and whether any identified deferred maintenance should be addressed in connection with origination. In some cases, Rialto uses conclusions in the engineering reports in connection with making a determination about the necessity for escrows related to repairs and the continued maintenance of the real property.
Seismic Report. If the real property related to an asset consists of improvements located in seismic zones 3 or 4, Rialto generally requires a seismic report from an engineering firm to establish the probable maximum or bounded loss for the improvements at the property as a result of an earthquake. Generally, if a seismic report concludes that the related real property is estimated to have a probable maximum loss or scenario expected loss in excess of 20%, Rialto may require retrofitting of the improvements or that the borrower obtain earthquake insurance if available at a commercially reasonable price.
Zoning and Building Code Compliance. In connection with the origination of an asset related to multifamily or commercial real estate, Rialto will generally obtain one or more of the following to consider whether the use and occupancy of the related real property is in material compliance with zoning, land use, building rules, regulations and orders then applicable to that property: zoning reports, legal opinions, surveys, recorded documents,
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temporary or permanent certificates of occupancy, letters from government officials or agencies, title insurance endorsements, engineering or consulting reports and/or representations by the related borrower. In cases where the real property constitutes a legal nonconforming use or structure, Rialto may require an endorsement to the title insurance policy and/or the acquisition of law and ordinance insurance with respect to the particular non-conformity unless it determines that: (i) the non-conformity should not have a material adverse effect on the ability of the borrower to rebuild, (ii) the real property, if permitted to be repaired or restored in conformity with current law, would in Rialto’s judgment constitute adequate security, (iii) any major casualty that would prevent rebuilding has a sufficiently remote likelihood of occurring, (iv) a variance or other similar change in applicable zoning restrictions is potentially available, or the applicable governing entity is unlikely to enforce the related limitations, (v) casualty insurance proceeds together with the value of any additional collateral are expected to be available in an amount estimated by Rialto to be sufficient to pay off all relevant indebtedness in full, and/or (vi) a cash reserve, a letter of credit or an agreement imposing recourse liability from a principal of the borrower is provided to cover losses.
Escrow Requirements. Based on its analysis of the related real property, the borrower and the principals of the borrower, Rialto may require a borrower to fund various escrows for taxes, insurance, capital expenses, replacement reserves, re-tenanting reserves, environmental remediation and/or other matters. Rialto conducts a case-by-case analysis to determine the need for a particular escrow or reserve. Consequently, the underlying documents for some assets do not contain provisions requiring the establishment of escrows and reserves, or only require the establishment of escrows and reserves in limited amounts and/or circumstances. Furthermore, where escrows or reserves are required, Rialto may accept an alternative to a cash escrow or reserve from a borrower, such as a letter of credit or a guarantee from the borrower or an affiliate of the borrower or periodic evidence that the items for which the escrow or reserve would have been established are being paid or addressed. In some cases, Rialto may determine that establishing an escrow or reserve is not warranted given the amounts that would be involved and Rialto’s evaluation of the ability of the real property, the borrower or a holder of direct or indirect ownership interests in the borrower to bear the subject expense or cost absent creation of an escrow or reserve.
Notwithstanding the foregoing discussion, Rialto may originate or acquire, and may have originated or acquired, real estate related loans and other investments that vary from, or do not comply with, Rialto’s underwriting guidelines as described in this prospectus supplement and/or such underwriting guidelines may not have been in place or may have been in place in a modified version at the time Rialto or its affiliates originated or acquired certain assets. In addition, in some cases, Rialto may not have strictly applied these underwriting guidelines as the result of a case-by-case permitted exception based upon other compensating factors.
Servicing
Interim servicing for Rialto Mortgage Loans prior to securitization is performed by a nationally recognized rated third party interim servicer. In addition, primary servicing is occasionally retained by certain qualified mortgage brokerage firms under established sub-servicing agreements with Rialto, which firms may continue primary servicing certain loans following the securitization closing date. Otherwise, servicing responsibilities are transferred from the interim servicer to the master servicer of the securitization trust (and a primary servicer when applicable) on the securitization Closing Date. From time to time, the interim servicer may retain primary servicing.
Exceptions to Underwriting Criteria
Rialto’s Mortgage Loans were not originated with any exceptions to Rialto’s underwriting criteria described above.
RAIT Funding, LLC
Overview. RAIT originates commercial mortgage loans from its headquarters in Philadelphia. All mortgage loans must be approved by RFT’s management investment committee, as described under “—Loan Approval” below. Set forth below is a discussion of certain general underwriting guidelines with respect to mortgage loans originated by RAIT (or in certain cases, an affiliate) for securitization.
Notwithstanding the discussion below, given the unique nature of commercial properties, the underwriting and origination procedures and the credit analysis with respect to any particular commercial mortgage loan may
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significantly differ from one asset to another and will be driven by circumstances particular to that loan and related property, including, among others, the property type, current use, size, location, market conditions, reserve requirements, additional collateral, tenant quality and lease terms, borrower identity, sponsorship, performance history and/or other factors. If a mortgage loan exhibits any one or more of the following characteristics, variances from general underwriting/origination procedures described below may, in some instances, be considered acceptable under the circumstances indicated: (i) low loan-to-value ratio; (ii) high debt service coverage ratio; (iii) experienced sponsor(s)/guarantor(s) with financial wherewithal; (iv) additional springing reserves; (v) cash flow sweeps; and (vi) elements of recourse included in the mortgage loan. Therefore, this general description of RAIT’s origination procedures and underwriting criteria is not intended as a representation that every commercial mortgage loan originated by it complies entirely with all procedures and criteria set forth below. For important information about the circumstances that have affected the underwriting of Mortgage Loans in the mortgage pool originated by RAIT or such affiliate, see the “Risk Factors” section of this prospectus supplement, the other subsections of this “Transaction Parties—The Sponsors” section and “Annex E-2—Exceptions to Sponsor Representations and Warranties” in this prospectus supplement.
Loan Analysis. Generally, RAIT performs both a credit analysis and collateral analysis with respect to a loan applicant and the real estate that will secure a mortgage loan. In general, the analysis of a borrower includes a review of anti-money laundering or OFAC checks, as well as background checks, and the analysis of its loan sponsor includes a review of money laundering and background checks, third-party credit reports, bankruptcy and lien searches, general banking references and commercial mortgage related references. In general, the analysis of the collateral includes a site visit and a review of the property’s historical operating statements (if available), independent market research, an appraisal with an emphasis on rental and sales comparables, engineering and environmental reports, the property’s historic and current occupancy, financial strengths of tenants, the duration and terms of tenant leases and the use of the property. Each report is reviewed for acceptability by a real estate finance loan underwriter. The borrower’s and property manager’s experience and presence in the subject market are also reviewed. Consideration is also given to anticipated changes in cash flow that may result from changes in lease terms or market considerations. Other factors that are considered in the origination of a commercial mortgage loan include current operations, occupancy and tenant base.
Borrowers are generally required to be single-purpose entities although they are generally not required to be structured to limit the possibility of becoming insolvent or bankrupt unless the loan has a principal balance of greater than $20 million, in which case additional limitations including the requirement that the borrower have at least one independent director are required.
Loan Approval. All mortgage loans originated by RAIT or such affiliate must be approved by a management investment committee of RFT. The credit committee may approve a mortgage loan as recommended, request additional due diligence, modify the loan terms or decline a loan transaction.
Debt Service Coverage Ratio and Loan-to-Value Ratio. RAIT’s underwriting standards generally mandate minimum debt service coverage ratios and maximum loan-to-value ratios. A loan-to-value ratio is generally based upon the appraiser’s determination of value. The debt service coverage ratio is based upon the underwritten net cash flow and is given particular importance. However, notwithstanding such guidelines, in certain circumstances the actual debt service coverage ratios, loan-to-value ratios and amortization periods for the mortgage loans originated by RAIT or such affiliate may vary from these guidelines.
In addition, with respect to certain mortgage loans originated by RAIT or such affiliate, there may exist subordinate debt secured by the related property and/or mezzanine debt secured by direct or indirect ownership interests in the related borrower. Such mortgage loans may have a lower debt service coverage ratio and/or a higher loan-to-value ratio if such subordinate and/or mezzanine debt is taken into account.
Escrow Requirements. Generally, RAIT requires most borrowers to fund various escrows for taxes and insurance, capital expenses and replacement reserves. Generally, the required escrows for mortgage loans originated by RAIT or such affiliate are as follows:
· | Taxes—Typically an initial deposit and monthly escrow deposits equal to 1/12th of the annual property taxes (based on the most recent property assessment and the current millage rate) are required to provide the lender with sufficient funds to satisfy all taxes and assessments. RAIT may waive this escrow requirement under appropriate circumstances including, but not limited to, where a tenant is required to pay the taxes directly. |
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· | Insurance—If the property is insured under an individual policy (i.e., the property is not covered by a blanket policy), typically an initial deposit and monthly escrow deposits equal to 1/12th of the annual property insurance premium are required to provide the lender with sufficient funds to pay all insurance premiums. The originator may waive this escrow requirement under appropriate circumstances, including, but not limited to, where a property is covered by a blanket insurance policy maintained by the borrower or sponsor, or where a tenant is required to insure the property (which tenant insurance may include self-insurance by the tenant). |
· | Replacement Reserves—Replacement reserves are generally calculated in accordance with the expected useful life of the components of the property during the term of the mortgage loan plus two years. The originator relies on information provided by an independent engineer to make this determination. The originator may waive this escrow requirement under appropriate circumstances, including, but not limited to, where a tenant is responsible for replacements under the terms of its lease. |
· | Completion Repair/Environmental Remediation—Typically, a completion repair or remediation reserve is required where an environmental or engineering report suggests that such reserve is necessary. Upon funding of the applicable mortgage loan, the originator generally requires that at least 110% to 125% of the estimated costs of repairs or replacements be reserved and generally requires that repairs or replacements be completed within a year after the funding of the applicable mortgage loan. The originator may waive this escrow requirement under appropriate circumstances, including, but not limited to, (i) where an investment grade party has agreed to take responsibility, and pay, for any required repair or remediation or (ii) the amount recommended is de minimis. |
· | Tenant Improvement/Lease Commissions—In most cases, various tenants have lease expirations within the mortgage loan term. To mitigate this risk, special reserves may be required to be funded either at closing of the mortgage loan and/or during the mortgage loan term to cover certain anticipated leasing commissions or tenant improvement costs which might be associated with re-leasing the space occupied by such tenants. The originator may waive this escrow requirement under appropriate circumstances, including, but not limited to, (i) where rents at the mortgaged property are considered to be sufficiently below market, (ii) where no material leases expire within the mortgage loan term, or the lease roll is not concentrated or (iii) where there is a low loan-to-value ratio (i.e., 65% or less). |
Servicing. Except as stated below, interim servicing for all loans originated by RAIT or such affiliate prior to securitization is typically performed by RAIT Partnership. RFT, the parent company of RAIT Partnership, is rated on Standard & Poor’s Ratings Services Select Servicer List as a U.S. Commercial Mortgage Primary and Special Servicer and is also a rated Commercial Mortgage Primary and Special Servicer by Morningstar Credit Ratings, LLC. In some instances, interim servicing for certain loans originated by RAIT and its affiliates is performed by either Grandbridge Real Estate Capital LLC or NorthMarq Capital, LLC.
Generally, servicing responsibilities are transferred from the interim servicer to the master servicer of the securitization trust at the closing of the securitization. From time to time, the interim servicer may retain primary servicing after closing of the securitization.
Exceptions to Underwriting Criteria.The RAIT Mortgage Loans were originated in accordance with the underwriting guidelines set forth above. None of the RAIT Mortgage Loans were originated with any exceptions to the related underwriting criteria.
KGS-Alpha Real Estate Capital Markets, LLC
Overview.KGS is the Sponsor with respect to the KGS Mortgage Loans. KGS originated each of the KGS Mortgage Loans being deposited into the securitization described in this prospectus supplement. Generally, KGS performed an underwriting analysis with respect to each KGS Mortgage Loan applicant and the related Mortgaged Property.
Notwithstanding the discussion below, given the unique nature of commercial mortgaged, multifamily and manufactured housing properties, the underwriting procedures and the credit analysis with respect to any
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particular commercial mortgage loan may significantly differ from one asset to another and will be driven by circumstances particular to that property including, among others, the property type, current use, size, location, market conditions, reserve requirements, additional collateral, tenant quality and lease terms, borrower identity, sponsorship, performance history and/or other factors. Therefore, this general description of KGS’s underwriting criteria is not intended as a representation that every commercial mortgage loan originated by KGS complies entirely with all procedures and criteria set forth below. For a description of any material exceptions to the underwriting guidelines in this prospectus supplement, see “—Exceptions to Underwriting Criteria” below.
If a mortgage loan exhibits one or more variances from the general underwriting procedures described below, such variances may be considered acceptable under certain circumstances, including but not limited to the following circumstances: (i) if the property achieves a low loan-to-value ratio; (ii) if the property achieves a high debt service coverage ratio; (iii) the quality of the property location; (iv) certain favorable market characteristics; (v) experienced sponsor(s)/guarantor(s) with financial wherewithal; (vi) additional springing reserves; (vii) cash flow sweeps; or (viii) elements of recourse included in the mortgage loan. For a description of any material exceptions to the underwriting guidelines in this prospectus supplement, see “—Exceptions to Underwriting Criteria” below.
Loan Analysis.Generally, both a credit analysis and a collateral analysis is conducted with respect to each mortgage loan. The credit analysis of the borrower generally includes a review of third-party credit reports, certifications provided by the borrower with respect to prior real estate experience and current contingent liabilities and/or judgment, lien, bankruptcy and pending litigation searches. The collateral analysis generally includes a review of the historical property operating statements, rent rolls and certain significant tenant leases, in each case to the extent available and applicable. The credit underwriting also generally includes a review of third party appraisals, as well as environmental reports, engineering assessments, zoning reports and seismic reports, if applicable and obtained. Generally, a site inspection is completed by a member of the KGS team to assess the tenancy of the property and to ascertain the overall quality, functionality and competitiveness of the property, including its neighborhood and market, accessibility and visibility. The submarket in which the property is located is assessed to evaluate competitive or comparable properties as well as market trends. Unless otherwise specified in this prospectus supplement, all financial, occupancy and other information contained in this prospectus supplement is based on such information and we cannot assure you that such financial, occupancy and other information remains accurate.
Loan Approval.All mortgage loans originated by KGS require approval by a loan credit committee, which includes senior risk management executives of KGS. The committee may approve a mortgage loan as recommended, request additional due diligence prior to approval, approve it subject to modifications of the loan terms, or decline a mortgage loan transaction.
Debt Service Coverage Ratio and Loan-to-Value Ratio.Generally, the debt service coverage ratio for mortgage loans originated by KGS that is calculated based on values determined at the origination of the mortgage loan will be equal to or greater than 1.20x and the loan-to-value ratio for mortgage loans originated by KGS that is calculated based on values determined at the origination of the mortgage loan will be equal to or less than 80%. Notwithstanding the foregoing, exceptions may be made when consideration is given to circumstances particular to the mortgage loan, the related property, reserves or other factors. For example, KGS may originate a mortgage loan with a debt service coverage ratio below 1.20x or a loan-to-value ratio greater than 80% based on, among other factors, the location of the property, the amortization features of the mortgage loan (for example, if the mortgage loan provides for relatively rapid amortization), the type of tenants and leases at the property, the posting of additional collateral such as reserves, letters of credit and/or guarantees, KGS’s judgment of acceptable property and/or market performance, and/or other relevant factors. Additionally, mortgage loans originated by KGS may have a lower debt service coverage ratio and a higher loan-to-value ratio if any permitted subordinate or mezzanine debt is taken into account.
Additional Debt and Amortization.Certain mortgage loans originated by KGS may include, or may permit in the future, (i) subordinate debt secured by the related property and/or (ii) mezzanine debt secured by direct or indirect ownership interests in the borrower, and/or (iii) additional unsecured subordinate debt. It is possible that KGS or an affiliate of KGS may be the lender on any such additional debt. Also, certain mortgage loans may provide for payments of interest only, with no principal paydowns or amortization prior to maturity, or for an interest only period during a portion of the mortgage loan term.
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Assessments of Property Condition.As part of the underwriting process, the property assessments and reports described below are typically obtained:
Appraisals. Independent appraisals or an update of an independent appraisal is required in connection with the origination of each mortgage loan. KGS requires that the appraiser comply with and abide by Title XI of the Financial Institution Reform, Recovery and Enforcement Act of 1989 and the Uniform Standards of Professional Appraisal Practice. The appraisal is based on the current use of the mortgaged property and must include an estimate of the then-current market value of the property “as-is” in its then-current condition, although in certain cases, KGS may also obtain a value on an “as-stabilized” basis reflecting leases that have been executed but for which the related tenants have not yet commenced paying rent. KGS calculates the loan-to-value ratio based on the values set forth in the appraisal at the date of origination or acquisition, as applicable.
Environmental Assessment. Phase I environmental assessments that conform to the American Society for Testing and Materials (ASTM) Standard E 1527-13 entitled, “Standard Practices for Environmental Site Assessment: Phase I Environmental Site Assessment Process”, as may be amended from time to time, are performed on all properties. However, when circumstances warrant, an update of a prior environmental assessment, a transaction screen or a desktop review may be utilized. Nevertheless, an environmental assessment conducted at any particular real property collateral will not necessarily cover all potential environmental issues. In cases in which the assessment or update conditions that would require clean-up, remedial action or another response, KGS may require any of the following: additional environmental testing, such as a Phase II environmental assessment with respect to the subject real property collateral; that the borrower deposit reserves or post a letter of credit in an amount sufficient to complete any required remediation; an environmental or pollution liability insurance policy; remedial or other action from the borrower (including the establishment of any operations and maintenance plans recommended by the assessment); and/or a guaranty from the sponsor of the borrower.
Property Condition Assessments. Inspections or updates of previously conducted inspections are conducted by independent licensed engineers, architects or other consultants for all properties in connection with the origination of a mortgage loan. The exterior walls, roofing, interior construction, mechanical and electrical systems and general condition of the site, buildings and other improvements located at a property are inspected. The resulting reports on some of the properties may indicate a variety of deferred maintenance items and recommended capital expenditures. In some instances, repairs or maintenance are required to be completed before closing or within a certain period of time after origination (generally not more than 12 months from the origination date) and/or cash reserves are established to fund the deferred maintenance or replacement items.
Seismic Report. Generally, a seismic report is required for all properties located in seismic zones 3 or 4.
Zoning and Building Code Compliance. With respect to each mortgage loan, KGS will generally consider whether the use and occupancy of the related real property collateral is in material compliance with zoning, land-use, building rules, regulations and orders then applicable to such property. Evidence of this compliance may be in the form of one or more of the following: zoning reports; surveys; recorded documents; temporary or permanent certificates of occupancy; letters from government officials or agencies; title insurance endorsements; engineering or consulting reports; legal opinions; and/or representations by the related borrower.In some cases, a mortgaged property may constitute a legal non-conforming use or structure. In such cases, KGS may require an endorsement to the title insurance policy and/or the acquisition of law and ordinance coverage in the casualty insurance policy with respect to the particular non-conformity unless it determines that: (i) the non-conformity should not have a material adverse effect on the ability of the borrower to rebuild; or (ii) the real property, if permitted to be repaired or restored in conformity with current law, would in KGS’s judgment constitute adequate security; (iii) casualty insurance proceeds together with the value of any additional collateral are expected to be available in an amount estimated by KGS to be sufficient to pay off all relevant indebtedness in full, and/or (iv) a cash reserve, a letter of credit or an agreement imposing recourse liability from the sponsor of the borrower is provided to cover losses.
Escrow Requirements. KGS typically requires most borrowers to fund various escrows for taxes and insurance, immediate repairs, replacement reserves and, if applicable, tenant improvements and leasing commissions. Depending on the details of the loan transaction and the results of underwriting and due diligence review, additional reserves may be required. The following is a brief description of the reserves typically required by KGS:
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· | Taxes—typically, an initial deposit and monthly escrow deposits equal to 1/12th of the annual property taxes (based on the most recent property assessment and the current millage rate) are required to provide KGS with sufficient funds to satisfy all taxes and assessments, except (i) where there is an institutional sponsor or high net worth individual sponsor, (ii) if the tenant at a single tenant property or an investment grade or creditworthy tenant is required to pay taxes directly or (iii) where there is a low loan-to-value ratio or the mortgaged property meets a certain threshold debt service coverage ratio. |
· | Insurance—if the property is insured under an individual policy (i.e., the property is not covered by a blanket policy), typically an initial deposit and monthly escrow deposits equal to 1/12th of the annual property insurance premium are required to provide KGS with sufficient funds to pay all insurance premiums, except that such escrows are not required in certain circumstances, including, but not limited to, (i) if the related borrower maintains a blanket insurance policy, (ii) if the tenant at a single tenant property or an investment grade or creditworthy tenant is responsible for paying insurance premiums or self-insuring or (iii) where there is a low loan-to-value ratio or the mortgaged property meets a certain threshold debt service coverage ratio. |
· | Replacement Reserves—replacement reserves are generally calculated in accordance with the expected useful life of the components of the property during the term of the mortgage loan, except that such escrows are not required in certain circumstances, including, but not limited to (i) if the tenant at a single tenant property or an investment grade or creditworthy tenant is responsible for all repairs and maintenance or if a third party such as a franchisor, management company or association is collecting reserves for such purpose or (ii) where there is a low loan-to-value ratio or the mortgaged property meets a certain threshold debt service coverage ratio. |
· | Immediate Repairs / Environmental Remediation—typically, an immediate repair or remediation reserve is required where an environmental or engineering report suggests that such reserve is necessary. Upon funding of the applicable mortgage loan, KGS generally requires that at least 110% of the estimated costs of repairs be reserved and generally requires that repairs be completed within a year after the funding of the applicable mortgage loan, except that such escrows are not required in certain circumstances, including, but not limited to, (i) if the sponsor of the borrower delivers a guarantee with respect to such matter, (ii) if the estimated cost of such repair or remediation does not materially impact the property’s function, performance or value, (iii) if the related mortgaged property is a single tenant property for which the tenant is responsible for such repair or remediation or (iv) in the case of environmental remediation, insurance is obtained or already in place. |
· | Tenant Improvement / Leasing Commissions—in most cases, various tenants have lease expirations within the loan term. To mitigate this risk, special reserves may be required to be funded either at closing of the mortgage loan and/or during the related loan term to cover certain anticipated leasing commissions or tenant improvement costs which might be associated with re-leasing the space occupied by such tenants, except that such escrows are not required in certain circumstances, including, but not limited to, (i) if the related mortgaged property is a single tenant property (or is substantially leased to a single tenant) and the related tenant’s lease extends beyond the loan term, (ii) where rent at the related mortgaged property is considered below market or (iii) where there is a low loan-to-value ratio or the mortgaged property meets a certain threshold debt service coverage ratio. |
Furthermore, KGS may accept an alternative to a cash escrow or reserve from a borrower, such as a letter of credit or a guarantee from the borrower or the sponsor of the borrower or periodic evidence that the items for which the escrow or reserve would have been established are being paid or addressed. In some cases, KGS may determine that establishing an escrow or reserve is not warranted given the amounts that would be involved and KGS’s evaluation of the cash flow generated by the property and/or the ability of the borrower or a holder of direct or indirect ownership interests in the borrower to bear the subject expense or cost absent creation of an escrow or reserve. Occasionally, KGS will implement a cap on the total dollar amount that shall be collected into a reserve account. In certain cases, KGS has structured springing reserves for certain identified risks. This practice is utilized based upon KGS’s evaluation of the cash flow generated by the property and/or the ability of the borrower or a holder of direct or indirect ownership interests in the borrower to fund expenses at the property.
Title Insurance Policy. The borrower is required to provide, and KGS’s origination counsel will review, a title insurance policy for each property. The title insurance policies provided typically must meet the following
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requirements: (i) the title insurance policy is written by a title insurer licensed to do business in the jurisdiction where the mortgaged property is located, (ii) the title insurance policy is in an amount at least equal to the original principal balance of the mortgage loan, (iii) the title insurance policy’s protection and benefits run to the mortgagee and its successors and assigns, (iv) the title insurance policy is written on an American Land Title Association form or equivalent policy promulgated in the jurisdiction where the mortgaged property is located (to the extent available), and (v) if a survey was prepared, the legal description of the mortgaged property in the title policy conforms to that shown on the survey.
Property Insurance. KGS typically requires the borrower to provide one or more of the following insurance policies: (i) commercial general liability insurance for bodily injury or death and property damage; (ii) an “All Risk of Physical Loss” policy; (iii) if applicable, boiler and machinery coverage; and (iv) if the mortgaged property is located in a special flood hazard area where mandatory flood insurance purchase requirements apply, flood insurance. In some cases, a tenant is responsible for maintaining insurance and, subject to the satisfaction of rating conditions or net worth criteria, such tenant is permitted to self-insure against the risks.
Servicing. Interim servicing for all loans originated by KGS prior to securitization is typically performed by Wells Fargo Bank, National Association. However, there are circumstances when KGS uses a servicer other than Wells Fargo Bank, National Association. Generally, servicing responsibilities are transferred from the interim servicer to the master servicer of the securitization trust at the closing of the securitization. From time to time, the interim servicer may retain primary servicing.
Exceptions to Underwriting Criteria. None of KGS’s Mortgage Loans were originated with any exceptions to KGS’s underwriting criteria described above.
The Issuing Entity
The Issuing Entity, Citigroup Commercial Mortgage Trust 2015-GC31, is a New York common law trust that will be formed on the Closing Date pursuant to the Pooling and Servicing Agreement. The only activities that the Issuing Entity may perform are those set forth in the Pooling and Servicing Agreement, which are generally limited to owning and administering the Mortgage Loans and any REO Property, disposing of Defaulted Mortgage Loans and REO Property, issuing the Certificates, making distributions, providing reports to certificateholders and other activities described in this prospectus supplement. Accordingly, the Issuing Entity may not issue securities other than the Certificates, or invest in securities, other than investing of funds in the Collection Account and other accounts maintained under the Pooling and Servicing Agreement in certain short-term high-quality investments. The Issuing Entity may not lend or borrow money, except that the Master Servicer and the Trustee may make advances of delinquent monthly debt service payments to the Issuing Entity, and the Master Servicer, the Special Servicer and the Trustee may make servicing advances, to the Issuing Entity, but in each case only to the extent it deems such advances to be recoverable from the related Mortgage Loan; such advances are intended to provide liquidity, rather than credit support. The Pooling and Servicing Agreement may be amended as set forth under “The Pooling and Servicing Agreement—Amendment” in this prospectus supplement. The Issuing Entity administers the Mortgage Loans through the Trustee, the Certificate Administrator, the Master Servicer, the Special Servicer and the Operating Advisor, except that any Outside Serviced Mortgage Loan is being serviced and administered pursuant to the Outside Servicing Agreement. A discussion of the duties of the Trustee, the Certificate Administrator, the Master Servicer, the Special Servicer and the Operating Advisor, including any discretionary activities performed by each of them, is set forth under “—The Trustee,” “—The Certificate Administrator,” “—Servicers—The Master Servicer”, “—Servicers—The Special Servicer,” “—Servicers—The Outside Servicers and the Outside Special Servicers,” “—The Operating Advisor,” “Description of the Offered Certificates”and“The Pooling and Servicing Agreement”in this prospectus supplement.
The only assets of the Issuing Entity other than the Mortgage Loans and any REO Properties (and, with respect to a Loan Combination, solely the Issuing Entity’s interest in any REO property acquired with respect to such Loan Combination pursuant to the Pooling and Servicing Agreement or the Outside Servicing Agreement, as applicable) are the Distribution Account and other accounts maintained pursuant to the Pooling and Servicing Agreement and the short-term investments in which funds in the Distribution Account and other accounts are invested. The Issuing Entity has no present liabilities, but has potential liability relating to ownership of the Mortgage Loans and any REO Properties (and, with respect to a Loan Combination, solely the Issuing Entity’s interest in any REO property acquired with respect to such Loan Combination pursuant to the Pooling and Servicing Agreement or the Outside Servicing Agreement, as applicable), and the other activities described in this prospectus supplement, and indemnity obligations to the Depositor, the Trustee, the Certificate Administrator, the
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Master Servicer, the Special Servicer and the Operating Advisor and various related persons. The fiscal year of the Issuing Entity is the calendar year. The Issuing Entity has no executive officers or board of directors and acts through the Trustee, the Certificate Administrator, the Master Servicer and the Special Servicer.
The Depositor is contributing the Mortgage Loans to the Issuing Entity. The Depositor is purchasing the Mortgage Loans from the Sponsors, as described under“Description of the Mortgage Pool—Sale of Mortgage Loans; Mortgage File Delivery” and “—Cures, Repurchases and Substitutions” in this prospectus supplement.
Since the Issuing Entity is a common law trust, it may not be eligible for relief under the federal bankruptcy laws, unless it can be characterized as a “business trust” for purposes of the federal bankruptcy laws. Bankruptcy courts look at various considerations in making this determination, so it is not possible to predict with any certainty whether or not the trust would be characterized as a “business trust”.
The Trustee
Deutsche Bank Trust Company Americas (“DBTCA”) will act as trustee (in such capacity, the “Trustee”) and custodian (in such capacity, the “Custodian”) under the Pooling and Servicing Agreement.
DBTCA is a New York banking corporation with its offices located at 1761 East St. Andrew Place, Santa Ana, California 92705-4934, Attention: Trust Administration—CGCMT 2015-GC31, and its telephone number is (714) 247-6000.
DBTCA and its affiliates have provided corporate trust services since 1991. DBTCA and its affiliates have previously been appointed to the role of trustee for over 1,900 mortgage-backed transactions and have significant experience in this area.
DBTCA will also act as custodian of the mortgage files pursuant to the Pooling and Servicing Agreement. DBTCA and its affiliates have performed this custodial role in numerous mortgage-backed transactions since 1991. DBTCA will maintain the mortgage files in secure, fire-resistant facilities. DBTCA will not physically segregate the mortgage files from other mortgage files in DBTCA’s custody but will keep them in shared facilities. However, DBTCA’s proprietary document tracking system will show the location within DBTCA’s facilities of each mortgage file and will show that the Mortgage Loan documents are held on behalf of the Issuing Entity.
In its capacity as trustee on commercial mortgage securitizations, DBTCA is generally required to make an advance if the related master servicer or special servicer fails to make a required advance. In the past three years, DBTCA, in its capacity as trustee, has not been required to make an advance on a domestic commercial mortgage-backed securities transaction.
DBTCA has been named as a defendant in civil litigation concerning its role as trustee of certain residential mortgage-backed securities (“RMBS”) trusts. On June 18, 2014, a group of investors (“Plaintiff Investors”) filed a civil action against DBTCA and Deutsche Bank National Trust Company (“DBNTC”) in New York State Supreme Court purportedly on behalf of and for the benefit of 544 private-label RMBS trusts asserting claims for alleged violations of the Trust Indenture Act of 1939, breach of contract, breach of fiduciary duty and negligence based on DBTCA’s and DBNTC’s alleged failure to perform their obligations as trustees for the trusts (the “NY Derivative Action”). An amended complaint was filed on July 16, 2014, adding Plaintiff Investors and RMBS trusts to the NY Derivative Action. On November 24, 2014, the Plaintiff Investors moved to voluntarily dismiss the NY Derivative Action without prejudice. Also on November 24, 2014, substantially the same group of Plaintiff Investors filed a civil action against DBTCA and DBNTC in the United States District Court for the Southern District of New York (the “SDNY Action”), making substantially the same allegations as the New York Derivative Action with respect to 564 RMBS trusts (542 of which were at issue in the NY Derivative Action). The SDNY Action is styled both as a derivative action on behalf of the named RMBS trusts and, in the alternative, as a putative class action on behalf of holders of RMBS representing interests in those RMBS trusts. DBTCA is vigorously defending the SDNY Action. DBTCA has no pending legal proceedings (including, based on DBTCA’s present evaluation, the litigation disclosed in this paragraph) that would materially affect its ability to perform its duties as Trustee on behalf of the Certificateholders.
The foregoing information concerning the Trustee has been provided by DBTCA. None of the Depositor, the underwriters, the Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator, the
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Sponsors or any of their affiliates takes any responsibility for this information or makes any representation or warranty as to its accuracy or completeness.
The Trustee is required to maintain a rating on its unsecured long term debt of at least “A1” by Moody’s Investors Service, Inc. (“Moody’s”) (or “A2” by Moody’s if the Trustee has a short term debt rating of at least “P-1” from Moody’s;provided,however, that solely with respect to DBTCA as the initial Trustee, for so long as the Master Servicer maintains a rating on its unsecured long term debt of at least “A2” by Moody’s and a short term debt rating of at least “P-1” from Moody’s, the initial Trustee will be deemed to have met these eligibility requirements if it maintains a rating on its unsecured long term debt of at least “Baa2” by Moody’s and a short term debt rating of at least “P-2” from Moody’s) (or such other rating with respect to which the Rating Agencies have provided a Rating Agency Confirmation). In addition, the Trustee is required to satisfy the requirements for a trustee contemplated by clause (a)(4)(i) of Rule 3a-7 under the Investment Company Act.
The Trustee may resign at any time by giving written notice to, among others, the other parties to the Pooling and Servicing Agreement. However, no such resignation will be effective until a successor has been appointed. Upon such notice, the Master Servicer will appoint a successor Trustee. If no successor Trustee has been appointed and accepted such appointment within one month after the giving of such notice of resignation, the resigning Trustee may petition the court for appointment of a successor Trustee.
The Depositor may remove the Trustee (and appoint a successor Trustee) if, among other things, the Trustee ceases to be eligible to continue as such under the Pooling and Servicing Agreement or if at any time the Trustee becomes incapable of acting, or is adjudged bankrupt or insolvent, or a receiver of the Trustee or its property is appointed or any public officer takes charge or control of the Trustee or of its property. The holders of Certificates evidencing more than 50% of the aggregate Voting Rights allocated to all of the Certificates may remove the Trustee (and appoint a successor Trustee) upon written notice to, among others, the Depositor, the Master Servicer, the Certificate Administrator and the Trustee.
Any resignation or removal of the Trustee and appointment of a successor Trustee will not become effective until acceptance by the successor Trustee of the appointment.
Notwithstanding the foregoing, upon any resignation or termination of the Trustee under the Pooling and Servicing Agreement, the Trustee will continue to be entitled to receive all accrued and unpaid compensation through the date of termination plus reimbursement for all Advances made by it and interest on those Advances as provided in the Pooling and Servicing Agreement. The Trustee will be required to bear all reasonable out-of-pocket costs and expenses of each party to the Pooling and Servicing Agreement and each Rating Agency in connection with any removal or resignation of such Trustee as and to the extent required under the Pooling and Servicing Agreement;provided, that if the Trustee is terminated without cause by the holders of Certificates evidencing more than 50% of the aggregate Voting Rights allocated to all of the Certificates as provided in the second preceding paragraph, then such holders will be required to pay all the reasonable costs and expenses of the Trustee necessary to effect the transfer of the rights and obligations (including custody of the Mortgage Loan files) of the Trustee to a successor Trustee. Any successor Trustee must have a combined capital and surplus of at least $50,000,000, and the ratings on its unsecured long term debt set forth above.
In addition, certain provisions regarding the obligations and duties of the Trustee, including those related to resignation and termination, may be subject to amendment in connection with a TIA Applicability Determination. See “The Pooling and Servicing Agreement—Amendment” in this prospectus supplement.
The Issuing Entity will indemnify the Trustee (including any capacities in which it serves) and certain related persons against any and all claims, losses, damages, penalties, fines, forfeitures, reasonable and necessary legal fees and related costs, judgments, and any other costs, fees and expenses that the Trustee may sustain in connection with the Pooling and Servicing Agreement (including any capacities in which it serves)(including, without limitation, reasonable fees and disbursements of counsel and of all persons not regularly in its employ incurred by the Trustee in any action or proceeding between the Issuing Entity and the Trustee or between the Trustee and any third party or otherwise) arising in respect of the Pooling and Servicing Agreement or the Certificates other than those resulting from the negligence, fraud, bad faith or willful misconduct, or the negligent disregard of obligations and duties under the Pooling and Servicing Agreement, of the Trustee. The Trustee will indemnify the Issuing Entity against any loss, liability or reasonable expense (including, without limitation, reasonable attorneys’ fees and expenses) incurred by the Issuing Entity as a result of any willful misconduct, bad faith, fraud or negligence in the performance of the obligations or duties of the Trustee, or by reason of negligent
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disregard of the Trustee’s obligations or duties, under the Pooling and Servicing Agreement. Except in the event of the Trustee’s willful misconduct, bad faith or fraud, in no event will the Trustee be liable for special, punitive, indirect or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action. The Trustee will not be required to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties under the Pooling and Servicing Agreement, or in the exercise of any of its rights or powers, if in the Trustee’s opinion, the repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.
At any time, for the purpose of meeting any legal requirements of any jurisdiction in which any part of the Issuing Entity, the assets thereof or any property securing the same is located, the Depositor and the Trustee acting jointly will have the power to appoint one or more persons or entities to act (at the expense of (i) the Trustee, if the need to appoint such co-trustee(s) arises from any change in the identity, organization, status, power, conflicts, internal policy or other development with respect to the Trustee, and/or (ii) the Issuing Entity, if the need to appoint such co-trustee(s) arises from a change in applicable law or the identity, status or power of the Issuing Entity;provided,however, that in the event the need to appoint such co-trustee(s) arises from a combination of or none of the events described in clause (i) and clause (ii), the expense will be split evenly between the Trustee and the Issuing Entity) as co-trustee or co-trustees, jointly with the Trustee, or separate trustee or separate trustees, of all or any part of the Issuing Entity, and to vest in such co-trustee or separate trustee such powers, duties, obligations, rights and trusts as the Depositor and the Trustee may consider necessary or desirable. The appointment of a co-trustee or separate trustee will not relieve the Trustee of its responsibilities, obligations and liabilities under the Pooling and Servicing Agreement except as required by applicable law.
If no Servicer Termination Event has occurred, and after the curing or waiver of all Servicer Termination Events which may have occurred, the Trustee is required to perform only those duties specifically required under the Pooling and Servicing Agreement. Upon receipt of the various certificates, reports or other instruments required to be furnished to it, the Trustee is required to examine such documents and to determine whether they conform on their face to the requirements of the Pooling and Servicing Agreement.
The Trustee will not be accountable for the use or application by the Depositor of any Certificates issued to it or of the proceeds of the sale of such Certificates, or for the use of or application of any funds paid to the Depositor, the Certificate Administrator, the Master Servicer or the Special Servicer in respect of the Mortgage Loans, or for investment of such amounts (except for any investment of such amounts in investments issued by the Trustee in its commercial capacity), nor will the Trustee be required to perform, or be responsible for the manner of performance of, any of the obligations of the Master Servicer (except advancing as described in this prospectus supplement), the Special Servicer or the Certificate Administrator under the Pooling and Servicing Agreement unless the Trustee is acting as the successor to, and is vested with the rights, duties, powers and privileges of, the Master Servicer, the Special Servicer or the Certificate Administrator in accordance with the terms of the Pooling and Servicing Agreement.
The Certificate Administrator
Citibank, N.A., a national banking association (“Citibank”), will act as the certificate administrator (in such capacity, the “Certificate Administrator”) and the paying agent under the Pooling and Servicing Agreement. The corporate trust office of the Certificate Administrator responsible for administration of the Issuing Entity is located at 388 Greenwich Street, 14th Floor, New York, New York 10013, Attention: Citibank Agency & Trust—CGCMT 2015-GC31 and the office for certificate transfer services is located at 480 Washington Boulevard, 30th Floor, Jersey City, New Jersey 07310, Attention: Citibank Agency & Trust—CGCMT 2015-GC31.
Citibank is a wholly-owned subsidiary of Citigroup Inc., a Delaware corporation. Citibank performs as certificate administrator and custodian through the Agency and Trust line of business, which is part of the Global Transaction Services division. Citibank has primary corporate trust offices located in both New York and London. Citibank is a leading provider of corporate trust services offering a full range of agency, fiduciary, tender and exchange, depositary and escrow services. As of the end of the first quarter of 2015, Citibank’s Agency and Trust group managed in excess of $5.1 trillion in fixed income and equity investments on behalf of approximately 2,500 corporations worldwide. Since 1987, Citibank Agency and Trust has provided trustee services for asset-backed securities containing pool assets consisting of airplane leases, auto loans and leases, boat loans, commercial loans, commodities, credit cards, durable goods, equipment leases, foreign securities, funding agreement-backed
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note programs, truck loans, utilities, student loans and commercial and residential mortgages. As of the end of the first quarter of 2015, Citibank acted as trustee, certificate administrator and/or paying agent for approximately 51 transactions backed by commercial mortgages with an aggregate principal balance of approximately $49.3 billion. The Depositor, the Underwriter Entities, the Master Servicer, the Special Servicer and the Trustee may maintain banking and other commercial relationships with Citibank and its affiliates.
Under the terms of the Pooling and Servicing Agreement, Citibank is responsible for securities administration, which includes pool performance calculations, distribution calculations and the preparation of monthly distribution reports. An analyst also will be responsible for the timely delivery of reports to the administration unit for processing all cashflow items. As Certificate Administrator, Citibank is also responsible for the preparation and filing of all REMIC and grantor trust tax returns on behalf of the Issuing Entity and the preparation of monthly reports on Form 10-D, certain current reports on Form 8-K and annual reports on Form 10-K that are required to be filed with the SEC on behalf of the Issuing Entity. In the past three years, the Certificate Administrator has not made material changes to the policies and procedures of its securities administration services for CMBS.
There have been no material changes to Citibank’s policies and procedures with respect to its commercial mortgage-backed trustee function other than changes required by applicable laws. In the past three years, Citibank has not materially defaulted in its certificate administrator obligations under any pooling and servicing agreement or caused an early amortization or other performance triggering event because of its performance as trustee or certificate administrator with respect to CMBS.
Citibank is acting as Certificate Administrator of this CMBS transaction. In the ordinary course of business, Citibank is involved in a number of legal proceedings, including in connection with its role as trustee of certain RMBS transactions. One such proceeding was a civil action filed against Citibank in the Supreme Court of the State of New York on June 18, 2014 by a group of investors in 48 private-label RMBS trusts for which Citibank serves or did serve as trustee, asserting claims for alleged violations of the Trust Indenture Act of 1939, breach of contract, breach of fiduciary duty and negligence based on Citibank’s alleged failure to perform its duties as trustee for the 48 RMBS trusts. On November 24, 2014, plaintiffs sought leave to withdraw this action. On the same day, a smaller subset of similar plaintiff investors in 27 private-label RMBS trusts for which Citibank serves or did serve as trustee, filed a new civil action against Citibank in the Southern District of New York asserting similar claims as the prior action filed in state court. In January 2015, the court closed plaintiffs’ original state court action. Citibank’s motion to dismiss the federal complaint was fully briefed as of May 13, 2015.
There can be no assurances as to the outcome of litigation or the possible impact of litigation on the trustee or the RMBS trusts. However, Citibank denies liability and intends to vigorously defend against the litigation. Furthermore, neither the above-disclosed litigation nor any other pending legal proceeding involving Citibank will materially affect Citibank’s ability to perform its duties as Certificate Administrator under the Pooling and Servicing Agreement for this CMBS transaction.
The information set forth under this heading “—The Certificate Administrator” has been provided by Citibank. Citibank is providing such information at the Depositor’s request to assist it with the preparation of this prospectus supplement. None of the Depositor, the underwriters, the Master Servicer, the Special Servicer, the Operating Advisor, the Trustee, the Sponsors or any of their affiliates takes any responsibility for this information or makes any representation or warranty as to its accuracy or completeness.
The Certificate Administrator is required to maintain a rating on its unsecured long term debt of at least (A) “BBB+” by Fitch, and (B) “Baa2” by Moody’s (or such other rating with respect to which the Rating Agencies have provided a Rating Agency Confirmation).
The Certificate Administrator may resign at any time by giving written notice to, among others, the other parties to the Pooling and Servicing Agreement. However, no such resignation will be effective until a successor has been appointed. Upon such notice, the Master Servicer will appoint a successor Certificate Administrator. If no successor Certificate Administrator has been appointed and accepted such appointment within one month after the giving of such notice of resignation, the resigning Certificate Administrator may petition the court for appointment of a successor Certificate Administrator.
The Depositor may remove the Certificate Administrator (and appoint a successor Certificate Administrator) if, among other things, the Certificate Administrator ceases to be eligible to continue as such under the Pooling and Servicing Agreement or if at any time the Certificate Administrator becomes incapable of acting, or is adjudged
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bankrupt or insolvent, or a receiver of the Certificate Administrator or its property is appointed or any public officer takes charge or control of the Certificate Administrator or of its property. The holders of Certificates evidencing more than 50% of the aggregate Voting Rights allocated to all of the Certificates may remove the Certificate Administrator (and appoint a successor Certificate Administrator) upon written notice to, among others, the Depositor, the Master Servicer, the Trustee and the Certificate Administrator.
Any resignation or removal of the Certificate Administrator and appointment of a successor Certificate Administrator will not become effective until acceptance by the successor Certificate Administrator of the appointment.
Notwithstanding the foregoing, upon any resignation or termination of the Certificate Administrator under the Pooling and Servicing Agreement, the Certificate Administrator will continue to be entitled to receive all accrued and unpaid compensation through the date of termination. The Certificate Administrator will be required to bear all reasonable out-of-pocket costs and expenses of each party to the Pooling and Servicing Agreement and each Rating Agency in connection with any removal or resignation of such Certificate Administrator as and to the extent required under the Pooling and Servicing Agreementprovided, that if the Certificate Administrator is terminated without cause by the holders of Certificates evidencing more than 50% of the aggregate Voting Rights allocated to all of the Certificates as provided in the second preceding paragraph, then such holders will be required to pay all the reasonable costs and expenses of the Certificate Administrator necessary to effect the transfer of the rights and obligations (including custody of the Mortgage Loan files) of the Certificate Administrator to a successor Certificate Administrator. Any successor Certificate Administrator must have a combined capital and surplus of at least $50,000,000, and the ratings on its unsecured long-term debt set forth above.
In addition, certain provisions regarding the obligations and duties of the Certificate Administrator, including those related to resignation and termination, may be subject to amendment in connection with a TIA Applicability Determination. See “The Pooling and Servicing Agreement—Amendment” in this prospectus supplement.
The Issuing Entity will indemnify the Certificate Administrator and certain related persons against any and all claims, losses, damages, penalties, fines, forfeitures, reasonable and necessary legal fees and related costs, judgments, and any other costs, fees and expenses that the Certificate Administrator may sustain in connection with the Pooling and Servicing Agreement (including, without limitation, reasonable fees and disbursements of counsel and of all persons not regularly in its employ incurred by the Certificate Administrator in any action or proceeding between the Issuing Entity and the Certificate Administrator or between the Certificate Administrator and any third party or otherwise) arising in respect of the Pooling and Servicing Agreement or the Certificates other than those resulting from the negligence, fraud, bad faith or willful misconduct, or the negligent disregard of obligations and duties under the Pooling and Servicing Agreement, of the Certificate Administrator. The Certificate Administrator will indemnify the Issuing Entity against any loss, liability or reasonable expense (including, without limitation, reasonable attorneys’ fees and expenses) incurred by the Issuing Entity as a result of any willful misconduct, bad faith, fraud or negligence in the performance of the obligations or duties of the Certificate Administrator, or by reason of negligent disregard of the Certificate Administrator’s obligations or duties, under the Pooling and Servicing Agreement. Except in the event of the Certificate Administrator’s willful misconduct, bad faith or fraud, in no event will the Certificate Administrator be liable for special, punitive, indirect or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Certificate Administrator has been advised of the likelihood of such loss or damage and regardless of the form of action. The Certificate Administrator will not be required to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties under the Pooling and Servicing Agreement, or in the exercise of any of its rights or powers, if in the Certificate Administrator’s opinion, the repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.
The Certificate Administrator is required to perform only those duties specifically required under the Pooling and Servicing Agreement. Upon receipt of the various certificates, reports or other instruments required to be furnished to it, the Certificate Administrator is required to examine such documents and to determine whether they conform on their face to the requirements of the Pooling and Servicing Agreement.
The Certificate Administrator will not be accountable for the use or application by the Depositor of any Certificates issued to it or of the proceeds of the sale of such Certificates, or for the use of or application of any funds paid to the Depositor, the Master Servicer or the Special Servicer in respect of the Mortgage Loans, or for investment of such amounts (except for any investment of such amounts in investments issued by the Certificate Administrator in its commercial capacity), nor will the Certificate Administrator be required to perform, or be
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responsible for the manner of performance of, any of the obligations of the Master Servicer, the Special Servicer, the Trustee or the Operating Advisor under the Pooling and Servicing Agreement.
Pursuant to the Pooling and Servicing Agreement, the Certificate Administrator, at the cost and expense of the Depositor (other than with respect to the Distribution Date statements), based upon reports, documents, and other information provided to the Certificate Administrator, will be obligated to file with the SEC, in respect of the Issuing Entity and the Certificates, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the SEC may from time to time by rules and regulations prescribe) required to be filed with the SEC pursuant to Section 13 or 15(d) of the Exchange Act, and any other Form 8-K reports required to be filed pursuant to the Pooling and Servicing Agreement.
The Depositor may terminate the Certificate Administrator upon 5 business days’ notice if the Certificate Administrator fails to comply with certain of its reporting obligations under the Pooling and Servicing Agreement.
Trustee and Certificate Administrator Fee
Pursuant to the Pooling and Servicing Agreement, the Trustee and Certificate Administrator will be entitled to receive a monthly fee (the “Trustee/Certificate Administrator Fee”). The Trustee/Certificate Administrator Fee will be payable monthly from amounts received in respect of the Mortgage Loans and, as to each Mortgage Loan, will accrue at 0.0034% per annum (the “Trustee/Certificate Administrator Fee Rate”) which, together with the Servicing Fee Rate, the CREFC® Intellectual Property Royalty License Fee Rate and the Operating Advisor Fee Rate, is equal to the per annum rate set forth on Annex A to this prospectus supplement as the “Administrative Fee Rate”. The Trustee/Certificate Administrator Fee will be paid monthly to the Certificate Administrator and the Certificate Administrator will pay the Trustee its portion of the Trustee/Certificate Administrator Fee in accordance with the Pooling and Servicing Agreement. The Trustee/Certificate Administrator Fee will accrue on the Stated Principal Balance of each Mortgage Loan and will be calculated on the same interest accrual basis as the related Mortgage Loan and prorated for any partial periods.
The Operating Advisor
Pentalpha Surveillance LLC (“Pentalpha Surveillance”), a Delaware limited liability company, will act as operating advisor under the Pooling and Servicing Agreement (in such capacity, the “Operating Advisor”).
Pentalpha Surveillance, located at 375 N. French Road, Amherst, New York, is privately held and primarily dedicated to providing independent oversight of loan securitization trusts’ ongoing operations. Pentalpha Surveillance is an affiliate of the privately-owned Pentalpha group of companies, which is headquartered at Two Greenwich Office Park, Greenwich, Connecticut. The Pentalpha group of companies was founded in 1995 and is managed by James Callahan. Mr. Callahan has historically focused on subordinate debt trading of commercial mortgage-backed securities and residential mortgage-backed securities, as well as securities backed by consumer and corporate loans.
Pentalpha Surveillance maintains proprietary software and a team of industry operations veterans dedicated to investigating and resolving securitization matters including, but not limited to, collections optimization, representation and warranty settlements, derivative contract errors and transaction party disputes. Loans collateralized by commercial and residential real estate debt represent the majority of its focus. Some of the company’s oversight assignments utilize “after the action” compliance reviews while others are more proactive and include delegated authority that requires Pentalpha Surveillance to provide “loan-level preapprovals” before a vendor takes an action. More than $500 billion of residential, commercial and other income producing loans have been boarded to the Pentalpha Surveillance system in connection with the services provided by the Pentalpha group of companies.
Pentalpha Surveillance and its affiliates have been engaged by individual securitization trusts, financial institutions, institutional investors as well as agencies of the U.S. Government. As of May 31, 2015, Pentalpha Surveillance has acted as operating advisor or trust advisor in approximately 62 commercial mortgage-backed securitizations with an aggregate initial unpaid principal balance of approximately $70 billion since October 2010.
Pentalpha Surveillance is not an affiliate of the Issuing Entity, the Depositor, the Sponsors, the Trustee, the Certificate Administrator, the Master Servicer, the Special Servicer, the Directing Holder or any “originators”
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(within the meaning of Item 1110 of Regulation AB) or “significant obligor” (within the meaning of Item 1112 of Regulation AB) with respect to the Issuing Entity.
From time to time, Pentalpha Surveillance may be a party to lawsuits and other legal proceedings arising in the ordinary course of business. However, there are currently no legal proceedings pending, and no legal proceedings known to be contemplated by governmental authorities, against Pentalpha Surveillance or of which any of its property is the subject, that would have a material adverse effect on Pentalpha Surveillance’s business or its ability to serve as operating advisor pursuant to the Pooling and Servicing Agreement or that is material to the holders of the Certificates.
The foregoing information under this heading has been provided by Pentalpha Surveillance. None of the Depositor, the underwriters, the Master Servicer, the Special Servicer, the Sponsors, the Trustee, the Certificate Administrator or any of their affiliates takes any responsibility for this information or makes any representation or warranty as to its accuracy or completeness.
Certain terms of the Pooling and Servicing Agreement regarding the Operating Advisor’s removal, replacement, resignation or transfer are described under “The Pooling and Servicing Agreement—Certain Matters Regarding the Depositor, the Master Servicer, the Special Servicer and the Operating Advisor” and “—Operating Advisor” in this prospectus supplement. Certain limitations on the Operating Advisor’s liability under the Pooling and Servicing Agreement are described under “The Pooling and Servicing Agreement—Certain Matters Regarding the Depositor, the Master Servicer, the Special Servicer and the Operating Advisor” in this prospectus supplement.
For further information regarding the rights and obligations of the Operating Advisor under the Pooling and Servicing Agreement, see “The Pooling and Servicing Agreement—Operating Advisor” in this prospectus supplement.
Servicers
General
Each of the Master Servicer (directly or through one or more sub-servicers (which includes the primary servicers)) and the Special Servicer will be required to service and administer the Serviced Loans for which it is responsible as described under “The Pooling and Servicing Agreement—Servicing of the Mortgage Loans” in this prospectus supplement. The Master Servicer may delegate and/or assign some or all of its servicing obligations and duties with respect to some or all of the Serviced Loans to one or more third party sub-servicers, with the consent of the Depositor. Certain servicing and administrative functions may also be provided by one or more primary servicers that previously serviced the mortgage loans for the applicable loan seller. The Master Servicer will be responsible for paying the servicing fees of any sub-servicer or primary servicer. Notwithstanding any sub-servicing agreement or primary servicing agreement, the Master Servicer will remain primarily liable to the Trustee and the Certificateholders (and any Serviced Companion Loan Holders) for the servicing and administering of the Serviced Loans in accordance with the provisions of the Pooling and Servicing Agreement without diminution of such obligation or liability by virtue of such sub-servicing agreement or primary servicing agreement. The Special Servicer will not be permitted to appoint sub-servicers with respect to any of its servicing obligations and duties, other than in the limited circumstances described under “The Pooling and Servicing Agreement—Servicing of the Mortgage Loans” in this prospectus supplement.
The Master Servicer
Wells Fargo Bank, National Association (“Wells Fargo”) will act as the master servicer for all of the Mortgage Loans to be deposited into the Issuing Entity (in such capacity, the “Master Servicer”). Wells Fargo is a national banking association organized under the laws of the United States of America, and is a wholly-owned direct and indirect subsidiary of Wells Fargo & Company. On December 31, 2008, Wells Fargo & Company acquired Wachovia Corporation, the owner of Wachovia Bank, National Association (“Wachovia”), and Wachovia Corporation merged with and into Wells Fargo & Company. On March 20, 2010, Wachovia merged with and into Wells Fargo. Like Wells Fargo, Wachovia acted as master servicer of securitized commercial and multifamily mortgage loans and, following the merger of the holding companies, Wells Fargo and Wachovia integrated their two servicing platforms under a senior management team that is a combination of both legacy Wells Fargo managers and legacy Wachovia managers.
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The principal west coast commercial mortgage master servicing offices of Wells Fargo are located at MAC A0227-020, 1901 Harrison Street, Oakland, California 94612. The principal east coast commercial mortgage master servicing offices of Wells Fargo are located at MAC D1086, 550 South Tryon Street, Charlotte, North Carolina 28202.
Wells Fargo has been master servicing securitized commercial and multifamily mortgage loans in excess of ten years. Wells Fargo’s primary servicing system runs on McCracken Financial Solutions software, Strategy CS. Wells Fargo reports to trustees and certificate administrators in the CREFC® format. The following table sets forth information about Wells Fargo’s portfolio of master or primary serviced commercial and multifamily mortgage loans (including loans in securitization transactions and loans owned by other investors) as of the dates indicated:
Commercial and | As of 12/31/2012 | As of | As of | As of | ||||
By Approximate Number: | 35,189 | 33,354 | 33,590 | 33,399 | ||||
By Approximate Aggregate Unpaid Principal Balance (in billions): | $428.52 | $434.37 | $474.38 | $480.33 |
Within this portfolio, as of March 31, 2015, are approximately 24,503 commercial and multifamily mortgage loans with an unpaid principal balance of approximately $395.6 billion related to commercial mortgage-backed securities or commercial real estate collateralized debt obligation securities. In addition to servicing loans related to commercial mortgage-backed securities and commercial real estate collateralized debt obligation securities, Wells Fargo also services whole loans for itself and a variety of investors. The properties securing loans in Wells Fargo’s servicing portfolio, as of March 31, 2015, were located in all 50 states, the District of Columbia, Guam, Mexico, the Bahamas, the Virgin Islands and Puerto Rico and include retail, office, multifamily, industrial, hotel and other types of income-producing properties.
In its master servicing and primary servicing activities, Wells Fargo utilizes a mortgage-servicing technology platform with multiple capabilities and reporting functions. This platform allows Wells Fargo to process mortgage servicing activities including, but not limited to: (i) performing account maintenance; (ii) tracking borrower communications; (iii) tracking real estate tax escrows and payments, insurance escrows and payments, replacement reserve escrows and operating statement data and rent rolls; (iv) entering and updating transaction data; and (v) generating various reports.
The following table sets forth information regarding principal and interest advances and servicing advances made by Wells Fargo, as master servicer, on commercial and multifamily mortgage loans included in commercial mortgage-backed securitizations. The information set forth below is the average amount of such advances outstanding over the periods indicated (expressed as a dollar amount and as a percentage of Wells Fargo’s portfolio, as of the end of each such period, of master serviced commercial and multifamily mortgage loans included in commercial mortgage-backed securitizations).
Period | Approximate Securitized | Approximate | Approximate | |||
Calendar Year 2012 | $ 331,765,453,800 | $ 2,133,375,220 | 0.64% | |||
Calendar Year 2013 | $ 346,011,017,466 | $ 2,158,219,403 | 0.62% | |||
Calendar Year 2014 | $ 377,947,659,331 | $ 1,750,352,607 | 0.46% | |||
YTD Q1 2015 | $ 382,854,235,509 | $ 1,782,705,503 | 0.47% |
* | “UPB” means unpaid principal balance, “P&I” means principal and interest advances and “PPA” means property protection advances. |
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Wells Fargo is rated by Fitch, Standard & Poor’s Rating Services (“S&P”) and Morningstar Credit Ratings, LLC (“Morningstar”) as a primary servicer, a master servicer and a special servicer of commercial mortgage loans. Wells Fargo’s servicer ratings by each of these agencies are outlined below:
Fitch
| S&P
| Morningstar
| |
Primary Servicer: | CPS1- | Above Average | MOR CS1 |
Master Servicer: | CMS1- | Above Average | MOR CS1 |
Special Servicer: | CSS2 | Above Average | MOR CS2 |
The long-term deposits of Wells Fargo are rated “AA-” by S&P, “Aa3” by Moody’s and “AA-” by Fitch. The short-term deposits of Wells Fargo are rated “A-1+” by S&P, “P-1” by Moody’s and “F1+” by Fitch.
Wells Fargo has developed policies, procedures and controls relating to its servicing functions to maintain compliance with applicable servicing agreements and servicing standards, including procedures for handling delinquent loans during the period prior to the occurrence of a special servicing transfer event. Wells Fargo’s master servicing policies and procedures are updated periodically to keep pace with the changes in the commercial mortgage-backed securities industry and have been generally consistent for the last three years in all material respects. The only significant changes in Wells Fargo’s policies and procedures have come in response to changes in federal or state law or investor requirements, such as updates issued by the Federal National Mortgage Association or Federal Home Loan Mortgage Corporation.
Wells Fargo may perform any of its obligations under the Pooling and Servicing Agreement through one ormore third-party vendors, affiliates or subsidiaries. Notwithstanding the foregoing, the Master Servicer will remain responsible for its duties thereunder. Wells Fargo may engage third-party vendors to provide technology or process efficiencies. Wells Fargo monitors its third-party vendors in compliance with its internal procedures and applicable law. Wells Fargo has entered into contracts with third-party vendors for the following functions:
· | provision of Strategy and Strategy CS software; |
· | tracking and reporting of flood zone changes; |
· | abstracting of leasing consent requirements contained in loan documents; |
· | legal representation; |
· | assembly of data regarding buyer and seller (borrower) with respect to proposed loan assumptions and preparation of loan assumption package for review by Wells Fargo; |
· | performance of property inspections; |
· | performance of tax parcel searches based on property legal description, monitoring and reporting of delinquent taxes, and collection and payment of taxes; and |
· | Uniform Commercial Code searches and filings. |
Wells Fargo may also enter into agreements with certain firms to act as a primary servicer and to provide cashiering or non-cashiering sub-servicing on the Serviced Loans. Wells Fargo monitors and reviews the performance of sub-servicers appointed by it. Generally, all amounts received by Wells Fargo on the Mortgage Loans will initially be deposited into a common clearing account with collections on other mortgage loans serviced by Wells Fargo and will then be allocated and transferred to the appropriate account as described in this prospectus supplement. On the day any amount is to be disbursed by Wells Fargo, that amount is transferred to a common disbursement account prior to disbursement.
Wells Fargo will not have primary responsibility for custody services of original documents evidencing the Serviced Loans. On occasion, Wells Fargo may have custody of certain of such documents as are necessary for enforcement actions involving the Serviced Loans or otherwise. To the extent Wells Fargo performs custodial functions as a servicer, documents will be maintained in a manner consistent with the Servicing Standard.
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A Wells Fargo proprietary website (www.wellsfargo.com/com/comintro) provides investors with access to investor reports for commercial mortgage-backed securitization transactions for which Wells Fargo is master servicer, and also provides borrowers with access to current and historical loan and property information for these transactions.
Wells Fargo & Company files reports with the SEC as required under the Exchange Act. Such reports include information regarding Wells Fargo and may be obtained at the website maintained by the SEC at www.sec.gov.
There are no legal proceedings pending against Wells Fargo, or to which any property of Wells Fargo is subject, that are material to the Certificateholders, nor does Wells Fargo have actual knowledge of any proceedings of this type contemplated by governmental authorities.
Pursuant to an interim servicing agreement between Wells Fargo and CGMRC, a Sponsor and an Originator, Wells Fargo acts as interim servicer with respect to certain mortgage loans owned from time to time by CGMRC, which may include, prior to their inclusion in the Issuing Entity, some or all of the Mortgage Loans to be contributed to this securitization transaction by CGMRC.
Pursuant to an interim servicing agreement between Wells Fargo and GSMC, a Sponsor and an Originator, Wells Fargo may act as interim servicer with respect to certain mortgage loans owned from time to time by GSMC.
Pursuant to an interim servicing agreement between Wells Fargo and Rialto, a Sponsor and an Originator, Wells Fargo acts as interim servicer with respect to certain mortgage loans owned from time to time by Rialto, which may include, prior to their inclusion in the Issuing Entity, some or all of the Mortgage Loans to be contributed to this securitization transaction by Rialto.
Pursuant to an interim servicing agreement between Wells Fargo and KGS, a Sponsor and an Originator, Wells Fargo acts as interim servicer with respect to certain mortgage loans owned from time to time by KGS, which may include, prior to their inclusion in the Issuing Entity, some or all of the Mortgage Loans to be contributed to this securitization transaction by KGS.
The foregoing information regarding Wells Fargo under the heading “—Servicers—The Master Servicer” has been provided by Wells Fargo. None of the Depositor, the underwriters, the Operating Advisor, the Trustee, the Certificate Administrator, or any of their affiliates takes any responsibility for this information or makes any representation or warranty as to its accuracy or completeness.
The Special Servicer
Torchlight Loan Services, LLC (“Torchlight”), will act as the special servicer (in such capacity, the “Special Servicer”) and in this capacity will initially be responsible for the servicing and administration of the Specially Serviced Mortgage Loans and REO Properties pursuant to the Pooling and Servicing Agreement.
Torchlight is a Delaware limited liability company. Its principal servicing office is located at 701 Brickell Avenue, Suite 2200, Miami, Florida 33131, with additional servicing functions in New York City, New York, and its telephone number is (212) 883-2800. Torchlight is wholly owned by Torchlight Investors, LLC, which through its subsidiaries, affiliates and joint ventures, is involved in the real estate investment, finance and management business, and engages principally in:
· | investing in high-yielding real estate loans; |
· | investing in unrated and non-investment grade rated securities issued pursuant to CMBS transactions; and |
· | distressed debt workout, through Torchlight, its nationally rated special servicing affiliate. |
Torchlight has substantial experience in working out loans and has been engaged in servicing CMBS assets since December 2007. Torchlight’s then affiliated predecessor had been engaged in servicing CMBS assets since 1998. In the past six years, Torchlight has resolved over $8 billion of U.S. commercial and multifamily loans.
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The table below sets forth information about Torchlight’s portfolio of specially serviced commercial and multifamily mortgage loans as of the dates indicated:
CMBS Pools | As of 12/31/2012 | As of 12/31/2013 | As of 12/31/2014 | |||
By Approximate Number | 27 | 32 | 34 | |||
Named Specially Serviced Portfolio By Approximate Aggregate Unpaid Principal Balance(1) | $31,000,000,000 | $33,400,000,000 | $27,700,000,000 | |||
Actively Specially Serviced Portfolio By Approximate Number of Loans(2) | 169 | 150 | 143 | |||
Actively Specially Serviced Portfolio By Approximate Aggregate Unpaid Principal Balance(2) | $2,900,000,000 | $2,200,000,000 | $1,900,000,000 |
(1) | Includes all loans in Torchlight’s portfolio for which Torchlight is the named special servicer, regardless of whether such loans are, as of the specified date, specially-serviced loans. |
(2) | Includes only those loans in Torchlight’s portfolio that, as of the specified date, are specially-serviced loans. |
As of March 31, 2015, Torchlight had 25 personnel involved in the special servicing of commercial real estate assets, of which 15 were dedicated to the special servicing business unit. As of March 31, 2015, Torchlight was the named special servicer for approximately 33 CMBS Pools with a then approximate aggregate unpaid principal balance of $24,650,000,000. As of March 31, 2015, Torchlight specially serviced a portfolio which included approximately 130 loans throughout the 50 United States, the District of Columbia and Puerto Rico with a then-current face value of approximately $1,600,000,000, all of which are commercial or multifamily real estate assets. Those commercial real estate assets include mortgage loans secured by the same types of income producing properties as those securing the Mortgage Loans backing the Certificates. Accordingly, the assets that Torchlight services as well as assets owned by its affiliates may, depending upon the particular circumstances, including the nature and location of such assets, compete with the Mortgaged Properties securing the Mortgage Loans for tenants, purchasers, financing and so forth. Torchlight does not service or manage any assets other than commercial and multifamily real estate assets.
Torchlight has developed policies and procedures for the performance of its special servicing obligations in compliance with applicable servicing criteria set forth in Item 1122 of Regulation AB, including managing delinquent loans and loans subject to the bankruptcy of a borrower. Torchlight has recognized that technology can greatly improve its performance as a special servicer, and Torchlight’s Intranet based infrastructure provides improved controls for compliance with pooling and servicing agreements, loan administration and procedures in workout/resolution. Standardization and automation have been pursued, and continue to be pursued, wherever possible so as to provide for improved accuracy, efficiency, transparency, monitoring and controls.
Torchlight occasionally engages consultants to perform property inspections and to provide asset management and/or loan workout services on certain properties. Torchlight does not have any material primary advancing obligations with respect to the CMBS pools as to which it acts as special servicer and, accordingly, Torchlight does not believe that its financial condition will have any adverse effect on the performance of its duties under the Pooling and Servicing Agreement nor any material impact on the Mortgage Pool performance or the performance of the Certificates.
Torchlight will not have primary responsibility for custody services of original documents evidencing the Mortgage Loans. On occasion, Torchlight may have custody of certain of such documents as necessary for enforcement actions involving particular Mortgage Loans or otherwise. To the extent that Torchlight has custody of any such documents, such documents will be maintained in a manner consistent with the Servicing Standard.
There are currently no legal proceedings pending; and no legal proceedings known to be contemplated by governmental authorities, against Torchlight or of which any of its property is the subject, which is material to the Certificateholders. Torchlight is not an affiliate of the Depositor, the Sponsors, the Issuing Entity, the Master Servicer, the Trustee, the Certificate Administrator or any Originator of any of the Mortgage Loans identified in this prospectus supplement.
There are no relationships involving or relating to this transaction or the Mortgage Loans between Torchlight or any of its affiliates, on the one hand, and the Depositor, the Sponsors or the Issuing Entity, on the other hand, that currently exist or that existed during the past two (2) years. In addition, there are no business relationships,
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agreements, arrangements, transactions or understandings that have been entered into outside the ordinary course of business or on terms other than would be obtained in an arm’s length transaction with an unrelated third party—apart from the subject securitization transaction—between Torchlight or any of its affiliates, on the one hand, and the Depositor, the Sponsors or the Issuing Entity, on the other hand, that currently exist or that existed during the past two (2) years and that are material to an investor’s understanding of the Certificates.
No securitization transaction involving commercial or multifamily mortgage loans in which Torchlight was acting as special servicer has experienced an event of default as a result of any action or inaction performed by Torchlight as special servicer. In addition, there has been no previous disclosure of material non-compliance with servicing criteria by Torchlight with respect to any other securitization transaction involving commercial or multifamily mortgage loans in which Torchlight was acting as special servicer.
From time to time, Torchlight and its affiliates are parties to lawsuits and other legal proceedings arising in the ordinary course of business. Torchlight does not believe that any such lawsuits or legal proceedings would, individually or in the aggregate, have a material adverse effect on its business or its ability to serve as Special Servicer. Torchlight is an affiliate of the entity (and an affiliate of the manager of such entity) that is anticipated to be acquiring the Class E, Class F, Class G, Class H and Class S Certificates and to be, or to appoint, the initial Controlling Class Representative.
The foregoing information regarding Torchlight under the heading “—Servicers—The Special Servicer” has been provided by Torchlight. None of the Depositor, the underwriters, the Master Servicer, the Operating Advisor, the Trustee, the Certificate Administrator, or any of their affiliates takes any responsibility for this information or makes any representation or warranty as to its accuracy or completeness.
The Special Servicer will be required to pay all expenses incurred in connection with its responsibilities under the Pooling and Servicing Agreement (subject to reimbursement as described in this prospectus supplement).
The Special Servicer may be terminated, with respect to the Mortgage Loans serviced under the Pooling and Servicing Agreement (other than any Serviced Outside Controlled Loan Combination), without cause by (i) the applicable Certificateholders (if a Control Termination Event has occurred and is continuing) and (ii) the Controlling Class Representative (if a Control Termination Event does not exist). The Special Servicer may be removed and replaced with respect to a Serviced Outside Controlled Loan Combination, with or without cause at any time, at the direction of the related Outside Controlling Note Holder.
The Special Servicer may resign under the Pooling and Servicing Agreement as described under “The Pooling and Servicing Agreement—Certain Matters Regarding the Depositor, the Master Servicer, the Special Servicer and the Operating Advisor” in this prospectus supplement.
Certain duties and obligations of Torchlight as the Special Servicer and the provisions of the Pooling and Servicing Agreement are described under “The Pooling and Servicing Agreement—Servicing of the Mortgage Loans,” “—Enforcement of ‘Due-On-Sale’ and ‘Due-On-Encumbrance’ Clauses,” “—Inspections,” and “Description of the Offered Certificates—Appraisal Reduction Amounts” in this prospectus supplement. The Special Servicer’s ability to waive or modify any terms, fees, penalties or payments on the Mortgage Loans and the potential effect of that ability on the potential cash flows from the Mortgage Loans are described under “The Pooling and Servicing Agreement—Realization Upon Mortgage Loans—Modifications, Waivers and Amendments” in this prospectus supplement.
The Special Servicer and various related persons and entities will be entitled to be indemnified by the Issuing Entity for certain losses and liabilities incurred by the Special Servicer as described under “The Pooling and Servicing Agreement—Certain Matters Regarding the Depositor, the Master Servicer, the Special Servicer and the Operating Advisor” in this prospectus supplement.
The Outside Servicers and the Outside Special Servicers
Midland Loan Services, a Division of PNC Bank, National Association, is acting as the CGCMT 2015-GC29 Servicer and the CGCMT 2015-GC29 Special Servicer under the CGCMT 2015-GC29 Pooling and Servicing Agreement, and is also acting as the GSMS 2015-GC30 Servicer and the GSMS 2015-GC30 Special Servicer under the GSMS 2015-GC30 Pooling and Servicing Agreement.
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Midland Loan Services, a Division of PNC Bank, National Association, a national banking association (“Midland”), is acting as the CGCMT 2015-GC29 Servicer with respect to each of the Selig Office Portfolio Loan Combination and the Crowne Plaza Bloomington Loan Combination and the GSMS 2015-GC30 Servicer with respect to the Dallas Market Center Loan Combination, and in such capacities, is responsible for the servicing and administration of such Loan Combinations under the CGCMT 2015-GC29 Pooling and Servicing Agreement or the GSMS 2015-GC30 Pooling and Servicing Agreement, as applicable. Midland is also acting as the CGCMT 2015-GC29 Special Servicer with respect to each of the Selig Office Portfolio Loan Combination and the Crowne Plaza Bloomington Loan Combination and the GSMS 2015-GC30 Special Servicer with respect to the Dallas Market Center Loan Combination, and in such capacities, is responsible, if necessary, for the special servicing and administration of such Loan Combinations and any related REO properties, and in certain circumstances, may process, review, evaluate and/or provide or withhold its consent as to certain major decisions and other transactions relating to such Loan Combinations that are not specially serviced loans pursuant to the CGCMT 2015-GC29 Pooling and Servicing Agreement or the GSMS 2015-GC30 Pooling and Servicing Agreement, as applicable. Certain servicing and administrative functions may also be provided by one or more primary servicers that previously serviced the related Outside Serviced Loan Combination for the applicable loan seller. Midland’s principal servicing office is located at 10851 Mastin Street, Building 82, Suite 300, Overland Park, Kansas 66210.
Midland is a real estate financial services company that provides loan servicing, asset management and technology solutions for large pools of commercial and multifamily real estate assets. Midland is approved as a master servicer, special servicer and primary servicer for investment-grade commercial and multifamily mortgage-backed securities by S&P, Moody’s, Fitch, and Morningstar. Midland has received the highest rankings as a master, primary and special servicer of real estate assets under U.S. commercial and multifamily mortgage-backed securities transactions from S&P, Fitch, and Morningstar. For each category, S&P ranks Midland as “Strong”, Fitch ranks Midland as “1”, and Morningstar ranks Midland as “CS1”. Midland is also a HUD/FHA-approved mortgagee and a Fannie Mae-approved multifamily loan servicer.
Midland has detailed operating procedures across the various servicing functions to maintain compliance with its servicing obligations and the servicing standards under Midland’s servicing agreements, including procedures for managing delinquent and special serviced loans. The policies and procedures are reviewed annually and centrally managed. Furthermore Midland’s disaster recovery plan is reviewed annually.
Midland will not have primary responsibility for custody services of original documents evidencing the Outside Serviced Mortgage Loans. Midland may from time to time have custody of certain of such documents as necessary for enforcement actions involving particular Outside Serviced Mortgage Loans or otherwise. To the extent that Midland has custody of any such documents for any such servicing purposes, such documents will be maintained in a manner consistent with the servicing standard under the CGCMT 2015-GC29 Pooling and Servicing Agreement or the GSMS 2015-GC30 Pooling and Servicing Agreement, as applicable.
No securitization transaction involving commercial or multifamily mortgage loans in which Midland was acting as master servicer, primary servicer or special servicer has experienced a servicer event of default as a result of any action or inaction of Midland as master servicer, primary servicer or special servicer, as applicable, including as a result of Midland’s failure to comply with the applicable servicing criteria in connection with any securitization transaction. Midland has made all advances required to be made by it under the servicing agreements on the commercial and multifamily mortgage loans serviced by Midland in securitization transactions.
From time-to-time Midland is a party to lawsuits and other legal proceedings as part of its duties as a loan servicer (e.g., enforcement of loan obligations) and/or arising in the ordinary course of business. Midland does not believe that any such lawsuits or legal proceedings would, individually or in the aggregate, have a material adverse effect on its business or its ability to service loans pursuant to the CGCMT 2015-GC29 Pooling and Servicing Agreement or the GSMS 2015-GC30 Pooling and Servicing Agreement, as applicable.
Midland currently maintains an Internet-based investor reporting system, CMBS Investor Insight®, that contains performance information at the portfolio, loan and property levels on the various commercial mortgage-backed securities transactions that it services. Certificateholders, prospective transferees of the certificates and other appropriate parties may obtain access to CMBS Investor Insight through Midland’s website at www.pnc.com/midland. Midland may require registration and execution of an access agreement in connection with providing access to CMBS Investor Insight.
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As of March 31, 2015, Midland was servicing approximately 29,779 commercial and multifamily mortgage loans with a principal balance of approximately $325 billion. The collateral for such loans is located in all 50 states, the District of Columbia, Puerto Rico, Guam and Canada. Approximately 11,890 of such loans, with a total principal balance of approximately $159 billion, pertain to commercial and multifamily mortgage-backed securities. The related loan pools include multifamily, office, retail, hospitality and other income-producing properties. As of March 31, 2015, Midland was named the special servicer in approximately 170 commercial mortgage-backed securities transactions with an aggregate outstanding principal balance of approximately $93 billion. With respect to such transactions as of such date, Midland was administering approximately 106 assets with an outstanding principal balance of approximately $754 million.
Midland has been servicing mortgage loans in CMBS transactions since 1992. The table below contains information on the size of the portfolio of commercial and multifamily mortgage loans in CMBS and other servicing transactions for which Midland has acted as master and/or primary servicer from 2012 to 2014.
Portfolio Size – | Calendar Year End | |||||
2012 | 2013 | 2014 | ||||
CMBS | $115 | $141 | $157 | |||
Other | $167 | $167 | $179 | |||
Total | $282 | $308 | $336 |
Midland has acted as a special servicer for commercial and multifamily mortgage loans in CMBS transactions since 1992. The table below contains information on the size of the portfolio of specially serviced commercial and multifamily mortgage loans and REO properties that have been referred to Midland as special servicer in CMBS transactions from 2012 to 2014.
Portfolio Size – | Calendar Year End | |||||
2012 | 2013 | 2014 | ||||
Total | $82 | $70 | $85 |
Midland may enter into one or more arrangements with the controlling class representative, a controlling class certificateholder, any directing holder, any companion loan holder, the other certificateholders (or an affiliate or a third-party representative of one or more of the preceding), in each case under the CGCMT 2015-GC29 Pooling and Servicing Agreement or the GSMS 2015-GC30 Pooling and Servicing Agreement, as applicable, or any other person with the right to appoint or remove and replace the CGCMT 2015-GC29 Special Servicer or the GSMS 2015-GC30 Special Servicer, as applicable, to provide for a discount and/or revenue sharing with respect to certain of the special servicer compensation in consideration of, among other things, Midland’s appointment (or continuance) as the CGCMT 2015-GC29 Special Servicer under the CGCMT 2015-GC29 Pooling and Servicing Agreement or the GSMS 2015-GC30 Special Servicer under the GSMS 2015-GC30 Pooling and Servicing Agreement, as applicable, and the related Intercreditor Agreement and limitations on the right of such person to replace the CGCMT 2015-GC29 Special Servicer or the GSMS 2015-GC30 Special Servicer, as applicable. See“Risk Factors—Other Potential Conflicts of Interest May Affect Your Investment” in this prospectus supplement.
Pursuant to an interim servicing agreement between Midland and GSMC and certain of its affiliates, Midland acts as interim servicer with respect to certain of the Mortgage Loans to be sold to the Depositor by GSMC.
Eightfold Real Estate Capital Fund III, L.P. (or its affiliate), the initial controlling class representative under the CGCMT 2015-GC29 Pooling and Servicing Agreement, engaged Midland as an independent contractor to conduct due diligence with respect to each of the Selig Office Portfolio Loan Combination and the Crowne Plaza Bloomington Loan Combination.
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DoubleLine Capital LP, or its affiliate, the initial controlling class representative under the GSMS 2015-GC30 Pooling and Servicing Agreement, engaged Midland as an independent contractor to conduct due diligence with respect to the Dallas Market Center Loan Combination.
The foregoing information regarding the CGCMT 2015-GC29 Servicer, the CGCMT 2015-GC29 Special Servicer, the GSMS 2015-GC30 Servicer and the GSMS 2015-GC30 Special Servicer set forth in this section “—The Outside Servicers and the Outside Special Servicers” has been provided by Midland. Neither the Depositor nor any other person other than Midland makes any representation or warranty as to the accuracy or completeness of such information.
Servicing Compensation, Operating Advisor Compensation and Payment of Expenses
Master Servicing Compensation. The fee of the Master Servicer (the “Servicing Fee”) will be payable monthly from amounts received in respect of the related Mortgage Loan and any related Serviced Companion Loan (including any Specially Serviced Loan and any Outside Serviced Mortgage Loan) or any successor REO Mortgage Loan or successor REO Companion Loan. With respect to each such Mortgage Loan and Serviced Companion Loan (including each Specially Serviced Loan and each Outside Serviced Mortgage Loan) or any successor REO Mortgage Loan or successor REO Companion Loan, the Servicing Fee will: (a) accrue on the related Stated Principal Balance at a fixed annual rate (the “Servicing Fee Rate”), which, together with the CREFC® Intellectual Property Royalty License Fee Rate (in the case of a Mortgage Loan), the Trustee/Certificate Administrator Fee Rate (in the case of a Mortgage Loan) and the Operating Advisor Fee Rate (in the case of a Mortgage Loan), is equal to the per annum rate set forth on Annex A to this prospectus supplement as the Administrative Fee Rate with respect to such Mortgage Loan or Serviced Companion Loan; (b) be calculated on the same basis as interest is calculated on the related Mortgage Loan or Serviced Companion Loan, and (c) be prorated for partial periods. The Servicing Fee includes (i) all amounts required to be paid to any primary servicer or subservicer, and (ii) (a) with respect to the Selig Office Portfolio Mortgage Loan, the 0.0025% per annum servicing fee required to be paid to the CGCMT 2015-GC29 Servicer, (b) with respect to the Dallas Market Center Mortgage Loan, the 0.0025% per annum servicing fee required to be paid to the GSMS 2015-GC30 Servicer, and (c) with respect to the Crowne Plaza Bloomington Mortgage Loan, the 0.0025% per annum servicing fee required to be paid to the CGCMT 2015-GC29 Servicer.
With respect to any Distribution Date, the Master Servicer will be entitled to retain any Prepayment Interest Excesses received on the Serviced Loans to the extent not needed to make Compensating Interest Payments. In addition to the Servicing Fee, the Master Servicer will be entitled to retain, as additional servicing compensation (a) a specified percentage (which may be either 50% or 100% for performing Serviced Loans, and 0% for Specially Serviced Loans) of Excess Modification Fees, Excess Penalty Charges, Consent Fees, Ancillary Fees (other than fees for insufficient or returned checks), extension fees and Assumption Fees with respect to each Serviced Loan, (b) 100% of any assumption application fees with respect to each Serviced Loan that is not a Specially Serviced Loan, any defeasance fee received in connection with the defeasance of a Serviced Loan, and (c) 100% of fees for insufficient or returned checks actually received from borrowers on all Serviced Loans. The Master Servicer also is authorized but not required to invest or direct the investment of funds held in the Collection Account in certain investments permitted under the terms of the Pooling and Servicing Agreement, and the Master Servicer will be entitled to retain any interest or other income earned on those funds and will bear any losses resulting from the investment of these funds, except as set forth in the Pooling and Servicing Agreement. The Master Servicer also is entitled to retain any interest earned on any servicing escrow account to the extent the interest is not required to be paid to the related borrowers.
Although the Master Servicer is required to service and administer the Serviced Loans in accordance with the Servicing Standard and, accordingly, without regard to its rights to receive compensation under the Pooling and Servicing Agreement, additional servicing compensation in the nature of assumption and modification fees may under certain circumstances provide the Master Servicer with an economic disincentive to comply with this standard.
The Master Servicer will be entitled to designate a portion of the Servicing Fee accrued on the Mortgage Loans and the Serviced Companion Loans at a specified rate per annum, the right to which portion will be transferable by the Master Servicer to other parties. That specified rate will be subject to reduction at any time following any resignation of the Master Servicer or any termination of the Master Servicer for cause, in each case to the extent reasonably necessary for the trustee to appoint a successor Master Servicer that satisfies the requirements of the Pooling and Servicing Agreement.
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“Consent Fees” means, with respect to any Serviced Loan, any and all fees actually paid by a borrower with respect to any consent or approval required pursuant to the terms of the Serviced Loan documents that does not involve a modification evidenced by a signed writing, assumption, extension, waiver or amendment of the terms of the Serviced Loan documents.
“Excess Modification Fees” means, with respect to any Serviced Mortgage Loan (or Serviced Loan Combination, if applicable), the sum of (A) the excess of (i) any and all Modification Fees with respect to a modification, waiver, extension or amendment of any of the terms of a Serviced Mortgage Loan (or Serviced Loan Combination, if applicable),over (ii) all unpaid or unreimbursed Advances and additional trust fund expenses (including, without limitation, interest on unreimbursed Advances with respect to such Serviced Mortgage Loan (or Serviced Loan Combination, if applicable), but excluding (1) Special Servicing Fees, Workout Fees and Liquidation Fees and (2) Borrower Delayed Reimbursements) outstanding or previously incurred on behalf of the Issuing Entity with respect to the related Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) and reimbursed from such Modification Fees (which additional trust fund expenses will be reimbursed from such Modification Fees) and (B) expenses previously paid or reimbursed from Modification Fees as described in the preceding clause (A), which expenses have been recovered from the related borrower as Penalty Charges, specific reimbursements or otherwise. All Excess Modification Fees earned by the Special Servicer will be required to offset any future Workout Fees or Liquidation Fees payable with respect to the related Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) or REO Property;provided, that if the Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) ceases being a Corrected Loan, and is subject to a subsequent modification, any Excess Modification Fees earned by the Special Servicer prior to such Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) ceasing to be a Corrected Loan will no longer be offset against future Liquidation Fees and Workout Fees unless such Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) ceased to be a Corrected Loan within 18 months of it becoming a modified Mortgage Loan (or a modified Loan Combination, if applicable). In such case, the Special Servicer will be entitled to a Liquidation Fee or Workout Fee (to the extent not previously offset) with respect to the new modification, waiver, extension or amendment or future liquidation of the Specially Serviced Loan or related REO Property (including in connection with a repurchase, sale, refinance, discounted or final payoff or other liquidation);provided that any Excess Modification Fees earned and paid to the Special Servicer in connection with such subsequent modification, waiver, extension or amendment will be applied to offset such Liquidation Fee or Workout Fee to the extent described above. Within any prior 12-month period, all Excess Modification Fees earned by the Master Servicer or the Special Servicer (after taking into account any offset described above applied during such 12-month period) with respect to any Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) will be subject to a cap equal to the greater of (i) 1% of the outstanding principal balance of such Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) after giving effect to such transaction and (ii) $25,000.
“Borrower Delayed Reimbursements” means any unpaid or unreimbursed additional expenses (including, without limitation, Advances and interest on Advances) that the related borrower is required pursuant to a written modification agreement to pay in the future to the Issuing Entity in its capacity as owner of the related Mortgage Loan.
“Modification Fees” means, with respect to any Serviced Mortgage Loan (or Serviced Loan Combination, if applicable), any and all fees collected from the related borrower with respect to a modification, extension, waiver or amendment that modifies, extends, amends or waives any term of the Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) documents (as evidenced by a signed writing) agreed to by the Master Servicer or the Special Servicer (other than all Assumption Fees, assumption application fees, Consent Fees and defeasance fees).
“Penalty Charges” means, with respect to any Mortgage Loan (or Serviced Loan Combination, if applicable) (or successor REO Mortgage Loan or successor REO Companion Loan), any amounts actually collected thereon from the borrower that represent default charges, penalty charges, late fees and default interest (in the case of any Split Mortgage Loan or Serviced Companion Loan, to the extent allocable thereto pursuant to the related Co-Lender Agreement, and, in the case of a Serviced Companion Loan, to the extent not payable to the Serviced Companion Loan Holder, and, in the case of an Outside Serviced Mortgage Loan, to the extent remitted by the Outside Servicer to the Master Servicer).
“Ancillary Fees” means, with respect to any Serviced Loan, any and all demand fees, beneficiary statement charges, fees for insufficient or returned checks and other usual and customary charges and fees (other than
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Modification Fees, Consent Fees, Penalty Charges, defeasance fees, Assumption Fees and assumption application fees) actually received from the borrower.
“Excess Penalty Charges” means, with respect to any Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) and any Collection Period, the sum of (A) the excess of (i) any and all Penalty Charges collected in respect of such Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) during such Collection Period,over (ii) all unpaid or unreimbursed additional expenses (including without limitation interest on Advances, but excluding Special Servicing Fees, Workout Fees and Liquidation Fees) outstanding or previously incurred on behalf of the Issuing Entity (and, if applicable, the related Serviced Companion Loan Holder) with respect to any Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) and reimbursed from such Penalty Charges (which additional expenses will be reimbursed from such Penalty Charges) and (B) expenses previously paid or reimbursed from Penalty Charges as described in the preceding clause (A), which expenses have been recovered from the related borrower or otherwise.
“Assumption Fees” means, with respect to any Serviced Loan, any and all assumption fees with respect to a transfer of a related Mortgaged Property or interests in a related borrower (excluding assumption application fees).
An Outside Servicer will be entitled to receive servicing compensation with respect to the related Outside Serviced Loan Combination pursuant to the terms of the Outside Servicing Agreement, which servicing compensation will be similar, but not necessarily identical, to that payable to the Master Servicer with respect to a Serviced Loan Combination under the Pooling and Servicing Agreement (except that the applicable primary servicing fee rate under the related Outside Servicing Agreement for (i) the Selig Office Portfolio Mortgage Loan will be 0.0025% per annum, (ii) the Dallas Market Center Mortgage Loan will be 0.0025% per annum, and (iii) the Crowne Plaza Bloomington Mortgage Loan will be 0.0025% per annum, and in each case such applicable primary servicing fee rate is included in the related Servicing Fee Rate presented in this prospectus supplement.
Special Servicing Compensation. The principal compensation to be paid to the Special Servicer in respect of its special servicing activities will be the Special Servicing Fee, the Workout Fee and the Liquidation Fee.
The “Special Servicing Fee” will accrue with respect to each Specially Serviced Loan and REO Property serviced and administered under the Pooling and Servicing Agreement at the applicable Special Servicing Fee Rate calculated on the basis of the Stated Principal Balance of the related Specially Serviced Loan on the same basis as interest is calculated on the related Specially Serviced Loan and will be prorated for partial periods, and will be payable monthly from general collections on all the Mortgage Loans and any REO Properties.
“Special Servicing Fee Rate” means (a) 0.25% per annum or (b) if such rate in clause (a) would result in a Special Servicing Fee with respect to a Specially Serviced Loan or REO Property serviced and administered under the Pooling and Servicing Agreement, that would be less than $3,500 in any given month, then the Special Servicing Fee Rate for such month for such Specially Serviced Loan or REO Property will be such higher per annum rate as would result in a Special Servicing Fee equal to $3,500 for such month with respect to such Specially Serviced Loan or REO Property.
The “Workout Fee” will generally be payable with respect to each Corrected Loan serviced and administered under the Pooling and Servicing Agreement, and will be calculated by application of the applicable Workout Fee Rate to each collection of interest (excluding default interest and Excess Interest) and principal received on that Corrected Loan, for so long as it remains a Corrected Loan;provided that no Workout Fee will be payable by the Issuing Entity with respect to any such Corrected Loan if and to the extent that the Corrected Loan became a Specially Serviced Loan under clause (g) of the definition of Specially Serviced Loan (and no other clause of that definition) and no event of default actually occurs, unless the Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) is modified by the Special Servicer in accordance with the terms of the Pooling and Servicing Agreement;provided,further, that if a Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) becomes a Specially Serviced Loan under the Pooling and Servicing Agreement only because of an event described in clause (a) of the definition of Specially Serviced Loan and the related collection of interest and principal is received within 90 days following the related maturity date in connection with the full and final payoff or refinancing of the related Serviced Mortgage Loan (or Serviced Loan Combination, if applicable), the Special Servicer will not be entitled to collect a Workout Fee, but may collect and retain appropriate fees from the related borrower in connection with such workout. The Workout Fee with respect to any Specially Serviced Loan that becomes a Corrected Loan under the Pooling and Servicing Agreement will be reduced by any Excess
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Modification Fees paid by or on behalf of the related borrower with respect to such Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) as described in the definition of Excess Modification Fees, but only to the extent those fees have not previously been deducted from a Workout Fee or Liquidation Fee.
The Workout Fee with respect to any Corrected Loan serviced and administered under the Pooling and Servicing Agreement, will cease to be payable if the Corrected Loan again becomes a Specially Serviced Loan but will become payable again if and when the Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) again becomes a Corrected Loan.
The “Workout Fee Rate” under the Pooling and Servicing Agreement will be a rate equal to the lesser of (a) 1.0% and (b) such lower rate as would result in a workout fee of $1,000,000 when applied to each expected payment of principal and interest (other than default interest and Excess Interest) on the subject Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) from the date such Mortgage Loan (or Serviced Loan Combination, if applicable) becomes a Corrected Loan, through and including the then-related maturity date;provided that, if the rate in clause (a) above would result in a Workout Fee that would be less than $25,000 when applied to each expected payment of principal and interest (other than default interest and Excess Interest) on the subject Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) from the date such Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) becomes a Corrected Loan through and including the then-related maturity date, then the Workout Fee Rate will be a rate equal to such higher rate as would result in a Workout Fee equal to $25,000 when applied to each expected payment of principal and interest (other than default interest and Excess Interest) on such Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) from the date such Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) becomes a Corrected Loan through and including the then-related maturity date.
If the Special Servicer resigns or is terminated other than for cause, it will receive any Workout Fees payable on the Serviced Mortgage Loans (or Serviced Loan Combinations, if applicable) that were Corrected Loans at the time of the resignation or termination or for which the resigning or terminated Special Servicer had cured the event of default through a modification, restructuring or workout negotiated by the Special Servicer and evidenced by a signed writing, but which had not as of the time the Special Servicer resigned or was terminated become a Corrected Loan solely because the borrower had not had sufficient time to make three consecutive full and timely Monthly Payments and which subsequently becomes a Corrected Loan as a result of the borrower making such three consecutive timely Monthly Payments, but such fee will cease to be payable in each case if the Corrected Loan again becomes a Specially Serviced Loan. The successor Special Servicer will not be entitled to any portion of those Workout Fees.
A “Liquidation Fee” will be payable with respect to each Specially Serviced Loan serviced and administered under the Pooling and Servicing Agreement, as to which the Special Servicer obtains a full or discounted payoff (or unscheduled partial payment to the extent such prepayment is required by the Special Servicer as a condition to a workout) from the related borrower and, except as otherwise described below, with respect to any Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) repurchased or substituted for by a Sponsor, and with respect to any Specially Serviced Loan or any REO Property serviced and administered under the Pooling and Servicing Agreement, as to which the Special Servicer receives any Liquidation Proceeds, insurance proceeds or condemnation proceeds. The Liquidation Fee for each such Serviced Mortgage Loan, Specially Serviced Loan or REO Property serviced and administered under the Pooling and Servicing Agreement, will be payable from, and will be calculated by application of the Liquidation Fee Rate, to the related payment or proceeds;provided, that the Liquidation Fee with respect to any such Specially Serviced Loan or REO Property will be reduced by the amount of any Excess Modification Fees paid by or on behalf of the related borrower with respect to the Specially Serviced Loan or REO Property as described in the definition of “Excess Modification Fees” but only to the extent those fees have not previously been deducted from a Workout Fee or Liquidation Fee;provided,further, that if a Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) becomes a Specially Serviced Loan under the Pooling and Servicing Agreement only because of an event described in clause (a) of the definition of Specially Serviced Loan and the related proceeds are received within 90 days following the related default in connection with the full and final payoff or refinancing of the related Serviced Mortgage Loan or Serviced Loan Combination, if applicable, the Special Servicer will not be entitled to collect a Liquidation Fee, but may collect and retain appropriate fees from the related borrower in connection with such liquidation;provided,however, that, except as contemplated by each of the immediately preceding provisos and the second following paragraph, no Liquidation Fee will be less than $25,000.
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The “Liquidation Fee Rate” under the Pooling and Servicing Agreement will be a rate equal to the lesser of (a) such rate as would result in a Liquidation Fee of $1,000,000 and (b) 1.0%.
Notwithstanding anything to the contrary described above, no Liquidation Fee will be payable based upon, or out of, Liquidation Proceeds received in connection with: (i) the repurchase of, or substitution for, any Mortgage Loan by the applicable Sponsor for a Material Document Defect or Material Breach, as applicable, within 120 days of the discovery or receipt of notice by the Sponsor of the Material Document Defect or Material Breach, as applicable, that gave rise to the particular repurchase or substitution obligation, (ii) the purchase of any Specially Serviced Loan or REO Property by a mezzanine loan holder, if any (based on a purchase option set forth under the related intercreditor agreement), or the holder of a Subordinate Companion Loan, if any (based on a purchase option set forth under the related Co-Lender Agreement), in each case within 90 days of the date that the first purchase option related to the subject Servicing Transfer Event first becomes exercisable; or (iii) the purchase or other acquisition of all of the Mortgage Loans and REO Properties (or the Issuing Entity’s interest therein) in connection with an optional termination of the Issuing Entity. The Special Servicer may not receive a Workout Fee and a Liquidation Fee with respect to the same proceeds collected on a Mortgage Loan.
“Liquidation Proceeds” means the amount (other than insurance proceeds and Condemnation Proceeds) received in connection with a liquidation of a Mortgage Loan, Serviced Companion Loan, Mortgaged Property, REO Property or interest in a Mortgage Loan, Serviced Companion Loan, Mortgaged Property or REO Property.
“Defaulted Mortgage Loan” means a Serviced Loan (i) that is delinquent at least 60 days in respect of its Monthly Payments or delinquent in respect of its balloon payment, if any, in either case such delinquency to be determined without giving effect to any grace period permitted by the related Mortgage or Mortgage Note and without regard to any acceleration of payments under the related Mortgage and Mortgage Note or (ii) as to which the Master Servicer or the Special Servicer has, by written notice to the related borrower, accelerated the maturity of the indebtedness evidenced by the related Mortgage Note.
The Special Servicer will also be entitled to retain, as additional servicing compensation: (a) a specified percentage (which may be either 0% or 50% for performing Serviced Loans, and 100% for Specially Serviced Loans) of Excess Modification Fees, Excess Penalty Charges, Consent Fees, Ancillary Fees (other than fees for insufficient or returned checks), extension fees and Assumption Fees with respect to each Serviced Loan; (b) 100% of any assumption application fees with respect to Specially Serviced Loans; and (c) any interest or other income earned on deposits in the REO Accounts.
Although the Special Servicer is required to service and administer the Serviced Loans in accordance with the Servicing Standard and, accordingly, without regard to its rights to receive compensation under the Pooling and Servicing Agreement, additional servicing compensation in the nature of assumption and modification fees may under certain circumstances provide the Special Servicer with an economic disincentive to comply with this standard.
With respect to each Collection Period, the Special Servicer will be required to deliver or cause to be delivered to the Certificate Administrator, without charge and within two business days following the related Determination Date, a report that discloses and contains an itemized listing of any Disclosable Special Servicer Fees received by the Special Servicer or any of its affiliates during the related Collection Period.
The Special Servicer and its affiliates will be prohibited from receiving or retaining any compensation or any other remuneration (including, without limitation, in the form of commissions, brokerage fees or rebates) from any person or entity (including, without limitation, the Issuing Entity, any borrower, any property manager, any guarantor or indemnitor in respect of a Serviced Mortgage Loan or Serviced Companion Loan and any purchaser of any Serviced Mortgage Loan, Serviced Companion Loan or REO Property) in connection with the disposition, workout or foreclosure of any Serviced Loan, the management or disposition of any REO Property, or the performance of any other special servicing duties under the Pooling and Servicing Agreement, other than as expressly provided for in the Pooling and Servicing Agreement;provided, that such prohibition will not apply to the Permitted Special Servicer/Affiliate Fees or the fees received by any person acting as an Outside Servicer or an Outside Special Servicer as expressly provided for under the Outside Servicing Agreement, or as master servicer or special servicer as expressly provided for under the pooling and servicing agreement governing the securitization of a Serviced Companion Loan.
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“Disclosable Special Servicer Fees” means, with respect to any Serviced Loan or REO Property, any compensation and other remuneration (including, without limitation, in the form of commissions, brokerage fees and rebates received or retained by the Special Servicer or any of its affiliates that is paid by any person or entity (including, without limitation, the Issuing Entity, any borrower, any property manager, any guarantor or indemnitor in respect of a Serviced Loan and any purchaser of any Serviced Loan or REO Property (or interest in an REO Property related to any Serviced Loan Combinations, if applicable)) in connection with the disposition, workout or foreclosure of any Serviced Loan, the management or disposition of any REO Property, and the performance by the Special Servicer or any such affiliate of any other special servicing duties under the Pooling and Servicing Agreement, other than (1) any special servicing compensation which is payable to the Special Servicer under the Pooling and Servicing Agreement, and (2) any Permitted Special Servicer/Affiliate Fees.
“Permitted Special Servicer/Affiliate Fees” means any commercially reasonable treasury management fees, banking fees, title insurance and/or other insurance commissions and fees received or retained by the Special Servicer or any of its affiliates in connection with any services performed by such party with respect to any Serviced Loan or REO Property, in each case, in accordance with the Pooling and Servicing Agreement.
An Outside Special Servicer will be entitled to receive special servicing compensation with respect to the related Outside Serviced Loan Combination pursuant to the terms of the Outside Servicing Agreement, which special servicing compensation will be similar, but not necessarily identical, to that payable to the Special Servicer with respect to a Serviced Loan Combination under the Pooling and Servicing Agreement.
Operating Advisor Compensation. An operating advisor fee (the “Operating Advisor Fee”) will be payable to the Operating Advisor monthly from amounts received in respect of the Mortgage Loans (including any Outside Serviced Mortgage Loan) and will accrue at the applicable Operating Advisor Fee Rate with respect to each Mortgage Loan (including any Outside Serviced Mortgage Loan) on the Stated Principal Balance of the Mortgage Loan and will be calculated on the same interest accrual basis as the related Mortgage Loan and prorated for any partial periods.
The “Operating Advisor Fee Rate” with respect to each Interest Accrual Period is a rate equal to 0.0013% per annum.
An Operating Advisor Consulting Fee will be payable to the Operating Advisor with respect to each Major Decision on which the Operating Advisor has consultation rights. The “Operating Advisor Consulting Fee” will be a fee for each such Major Decision equal to $10,000, or such lesser amount as the related borrower agrees to pay with respect to any Serviced Mortgage Loan (or Serviced Loan Combination, if applicable);provided that the Operating Advisor may in its sole discretion reduce the Operating Advisor Consulting Fee with respect to any Major Decision.
Each of the Operating Advisor Fee and the Operating Advisor Consulting Fee will be payable from funds on deposit in the Collection Account out of amounts otherwise available to make distributions on the Certificates as described in “The Pooling and Servicing Agreement—Withdrawals from the Collection Account” in this prospectus supplement, but with respect to the Operating Advisor Consulting Fee only to the extent that such fee is actually received from the related borrower. If the Operating Advisor has consultation rights with respect to a Major Decision, the Pooling and Servicing Agreement will require the Master Servicer or the Special Servicer, as applicable, to use commercially reasonable efforts consistent with the Servicing Standard to collect the applicable Operating Advisor Consulting Fee from the related borrower in connection with such Major Decision, but only to the extent not prohibited by the Mortgage Loan documents. The Master Servicer or the Special Servicer, as applicable, will each be permitted to waive or reduce the amount of any such Operating Advisor Consulting Fee payable by the related borrower if it determines that such full or partial waiver is in accordance with the Servicing Standard but may in no event take any enforcement action with respect to the collection of such Operating Advisor Consulting Fee other than requests for collection;provided that the Master Servicer or the Special Servicer, as applicable, will be required to consult with the Operating Advisor prior to any such waiver or reduction.
The Operating Advisor Fee will be payable from funds on deposit in the Collection Account out of amounts otherwise available to make distributions on the Certificates as described in “The Pooling and Servicing Agreement—Withdrawals from the Collection Account” in this prospectus supplement.
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Fees and Expenses. The amounts available for distribution on the Certificates on any Distribution Date will generally be net of the following amounts:
Type/Recipient | Amount(1) | Frequency | Source of Funds | |||
Servicing Fee and Sub-Servicing Fee / Master Servicer / Outside Servicer | with respect to each Mortgage Loan (including an REO Mortgage Loan and including an Outside Serviced Mortgage Loan), will accrue on the related Stated Principal Balance at a rate (which rate includes any sub-servicing fee rate and the primary servicing fee rate payable to the Outside Servicer with respect to an Outside Serviced Mortgage Loan), which together with the CREFC® Intellectual Property Royalty License Fee Rate, the Trustee/Certificate Administrator Fee Rate and the Operating Advisor Fee Rate, is equal to the per annum rate set forth on Annex A to this prospectus supplement as the Administrative Fee Rate with respect to such Mortgage Loan (calculated on the same basis as interest is calculated on the related Mortgage Loan and prorated for partial periods) | monthly | interest collections | |||
Additional Servicing Compensation / Master Servicer | – a specified percentage (which may be either 50% or 100% for performing Serviced Loans, and 0% for Specially Serviced Loans) of Excess Modification Fees, Excess Penalty Charges, Consent Fees, Ancillary Fees (other than fees for insufficient or returned checks), extension fees and Assumption Fees with respect to the Serviced Mortgage Loans | from time to time | the related fee/ investment income | |||
– 100% of assumption application fees on the Serviced Mortgage Loans that are not Specially Serviced Loans and any fee actually paid by a borrower in connection with the defeasance of a Serviced Mortgage Loan | from time to time | |||||
– 100% of fees for insufficient or returned checks actually received from borrowers on all Serviced Loans | from time to time | |||||
– all investment income earned on amounts on deposit in the collection account and certain reserve accounts | monthly | |||||
Special Servicing Fee / Special Servicer | with respect to any Serviced Mortgage Loan that is a Specially Serviced Loan or REO Mortgage Loan, will accrue at a rate equal to (a) 0.25% per annum or (b) if such rate in clause (a) would result in a Special Servicing Fee with respect to such Specially Serviced Mortgage Loan that would be less than $3,500 in any given month, then the Special Servicing Fee Rate for such month for such Specially Serviced Mortgage Loan will be such higher per annum rate as would result in a Special Servicing Fee equal to $3,500 for such month with respect to such Mortgage Loan (in each case, calculated on the related Stated Principal Balance and same basis as interest is calculated on the related Mortgage Loan and prorated for partial periods) | monthly | general collections |
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Type/Recipient | Amount(1) | Frequency | Source of Funds | |||
Workout Fee / Special Servicer | with some limited exceptions, an amount equal to the Workout Fee Rate applied to each payment or other collection of principal and interest (excluding default interest and Excess Interest) on any Serviced Mortgage Loan that became a Corrected Loan under the Pooling and Servicing Agreement, which Workout Fee Rate will equal the lesser of (a) 1.0% and (b) such lower rate as would result in a Workout Fee of $1,000,000, when applied to each expected payment of principal and interest (excluding default interest and Excess Interest) with respect to the subject Serviced Mortgage Loan from the date such Mortgage Loan becomes a Corrected Loan, through and including the then-related maturity date;provided that, if the rate in clause (a) above would result in a Workout Fee that would be less than $25,000 when applied to each expected payment of principal and interest (excluding default interest and Excess Interest) on any Serviced Mortgage Loan from the date such Mortgage Loan becomes a Corrected Loan through and including the then-related maturity date, then the Workout Fee Rate will be a rate equal to such higher rate as would result in a Workout Fee equal to $25,000 when applied to each expected payment of principal and interest (excluding default interest and Excess Interest) on such Mortgage Loan from the date such Mortgage Loan becomes a Corrected Loan through and including the then-related maturity date); andprovided,further, that no Workout Fee will be payable to the Special Servicer under the Pooling and Servicing Agreement with respect to any Outside Serviced Mortgage Loan. | monthly | the related collections of principal and interest | |||
Liquidation Fee / Special Servicer | with some limited exceptions, an amount generally equal to 1.0% of each recovery by the Special Servicer of Liquidation Proceeds, insurance proceeds, condemnation proceeds and/or other payments, with respect to each Serviced Mortgage Loan repurchased or substituted by a Sponsor, each Specially Serviced Loan and each REO Property;provided,however, that, the Liquidation Fee payable under the Pooling and Servicing Agreement with respect to any such Mortgage Loan will generally not be more than $1,000,000 or, with limited exception, less than $25,000; andprovided,further, that no Liquidation Fee will be payable to the Special Servicer under the Pooling and Servicing Agreement with respect to any Outside Serviced Mortgage Loan. | upon receipt of such proceeds and payments | the related Liquidation Proceeds, insurance proceeds, condemnation proceeds and borrower payments | |||
Additional Special Servicing Compensation / Special Servicer | – a specified percentage (which may be either 0% or 50% for performing Serviced Loans, and 100% for Specially Serviced Loans) of Excess Modification Fees, Excess Penalty Charges, Consent Fees, Ancillary Fees (other than fees for insufficient or returned checks), extension fees and Assumption Fees with respect to the Serviced Mortgage Loans | from time to time | the related fee/ investment income | |||
– 100% of assumption application fees on Specially Serviced Loans (other than any Outside Serviced Mortgage Loan) | from time to time | |||||
– all investment income received on funds in any REO account | from time to time |
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Type/Recipient | Amount(1) | Frequency | Source of Funds | |||
Trustee/Certificate Administrator Fee / Trustee/Certificate Administrator | with respect to each Mortgage Loan (including an REO Mortgage Loan), will accrue at a per annum rate equal to 0.0034% on the Stated Principal Balance of the related Mortgage Loan (calculated on the same basis as interest is calculated on the related Mortgage Loan and prorated for partial periods) | monthly | general collections | |||
Operating Advisor Fee / Operating Advisor | with respect to each Mortgage Loan (including an REO Mortgage Loan), will accrue at a per annum rate equal to 0.0013% on the Stated Principal Balance of the related Mortgage Loan (calculated on the same basis as interest is calculated on the related Mortgage Loan and prorated for any partial periods) | monthly | general collections | |||
Operating Advisor Consulting Fee / Operating Advisor | a fee in connection with each Major Decision for which the Operating Advisor has consulting rights equal to $10,000 or such lesser amount as the related borrower agrees to pay with respect to any Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) | from time to time | paid by related borrower | |||
Property Advances / Master Servicer and Trustee | to the extent of funds available, the amount of any Property Advances | from time to time | collections on the related loan, then default interest/late payment fees collected on any loan, or if not recoverable or in the case of Workout-Delayed Reimbursement Amounts, from general collections | |||
Interest on Property Advances / Master Servicer and Trustee | at Prime Rate | when advance is reimbursed | first from default interest/late payment fees and modification fees collected on the related loan, then default interest/late payment fees collected on any loan, then from general collections | |||
P&I Advances / Master Servicer and Trustee | to the extent of funds available, the amount of any P&I Advances | from time to time | collections on the related loan, then default interest/late payment fees collected on any loan, or if not recoverable or in the case of Workout-Delayed Reimbursement Amounts, from general collections |
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Type/Recipient | Amount(1) | Frequency | Source of Funds | |||
Interest on P&I Advances / Master Servicer and Trustee | at Prime Rate | when advance is reimbursed | first from default interest/late payment fees and modification fees collected on the related loan, then default interest/late payment fees collected on any loan, then from general collections | |||
Additional Servicing Compensation / Outside Servicer
| – a specified percentage (which may be either 50% or 100% for any related Outside Serviced Mortgage Loan if it is a performing loan, and 0% if it is a specially serviced loan) of excess modification fees, consent fees, extension fees and assumption fees with respect to any related Outside Serviced Mortgage Loan | from time to time | the related fee/ investment income | |||
– 100% of ancillary fees (other than fees for insufficient or returned checks), assumption application fees and excess penalty charges on any related Outside Serviced Mortgage Loan if it is not a specially serviced loan and any fee actually paid by a borrower in connection with the defeasance of any related Outside Serviced Mortgage Loan | from time to time from time to time | |||||
– 100% of fees for insufficient or returned checks actually received from borrowers on any related Outside Serviced Mortgage Loan | ||||||
– all investment income earned on amounts on deposit in the collection account and certain reserve accounts | monthly | |||||
Special Servicing Fee/CGCMT 2015-GC29 Special Servicer
| with respect to each related Outside Serviced Mortgage Loan if it is a specially serviced loan under the Outside Servicing Agreement or an REO property, will accrue at a rate equal to the greater of (a) 0.25% per annum and (b) the rate that would result in a special servicing fee of $3,500 for the related month on the stated principal balance of such specially serviced loan or REO property (in each case computed for the same period and on the same interest accrual basis respecting which any related interest payment due or deemed due on the related Outside Serviced Mortgage Loan is computed and prorated for partial periods) | monthly | first out of collections on such Outside Serviced Mortgage Loan and out of amounts in the related loan specific custodial account, and then from general collections in the collection account established under the Outside Servicing Agreement;provided,however, that in such instance, the Outside Servicer is expected to seek reimbursement from the Issuing Entity, which reimbursement would come from general collections in the Collection Account established under the Pooling and Servicing Agreement |
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Type/Recipient | Amount(1) | Frequency | Source of Funds | |||
Special Servicing Fee/GSMS 2015-GC30 Special Servicer
| with respect to each related Outside Serviced Mortgage Loan if it is a specially serviced loan under the Outside Servicing Agreement or an REO property, will accrue at a rate equal to 0.25% per annum (in each case computed for the same period and on the same interest accrual basis respecting which any related interest payment due or deemed due on the related Outside Serviced Mortgage Loan is computed and prorated for partial periods) | monthly | first out of collections on such Outside Serviced Mortgage Loan and out of amounts in the related loan specific custodial account, and then from general collections in the collection account established under the Outside Servicing Agreement;provided,however, that in such instance, the Outside Servicer is expected to seek reimbursement from the Issuing Entity, which reimbursement would come from general collections in the Collection Account established under the Pooling and Servicing Agreement | |||
Workout Fee/
| with some limited exceptions, an amount equal to the “workout fee rate” (described below) applied to each collection of principal (other than any amount for which a liquidation fee is paid) and interest (excluding default interest and excess interest) on any related Outside Serviced Loan Combination if it becomes a corrected loan under the related Outside Servicing Agreement, which “workout fee rate” will equal the lesser of (a) 1.0% and (b) such lower rate as would result in a workout fee of $1,000,000, when applied to each expected payment of principal and interest (excluding default interest and excess interest) with respect to the subject Outside Serviced Loan Combination from the date it becomes a corrected loan, through and including the then-related maturity date;provided that, if the rate in clause (a) above would result in a workout fee that would be less than $25,000 when applied to each expected payment of principal and interest (excluding default interest and excess interest) on such Outside Serviced Loan Combination from the date it becomes a corrected loan through and including the then-related maturity date, then the workout fee rate will be a rate equal to such higher rate as would result in a workout fee equal to $25,000 when applied to each expected payment of principal and interest (excluding default interest and excess interest) on such Outside Serviced Loan Combination from the date it becomes a corrected loan through and including the then-related maturity date. | monthly | the related collections of principal and interest |
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Type/Recipient | Amount(1) | Frequency | Source of Funds | |||
Liquidation Fee/ Outside Special Servicer
| with some limited exceptions, an amount equal to the “liquidation fee rate” (described below) applied to each recovery by the related Outside Special Servicer of liquidation proceeds, insurance proceeds, condemnation proceeds and/or other payments, with respect to any related Outside Serviced Loan Combination if it is repurchased or substituted, if it is a specially serviced loan or if the related Mortgaged Property has become an REO property;provided,however, that the liquidation fee payable under the Outside Servicing Agreement with respect to any Outside Serviced Mortgage Loan, with limited exceptions, will generally not be less than $25,000. The “liquidation fee rate” will equal the lesser of (a) 1.0% and (b) such lower rate as would result in a liquidation fee of $1,000,000. | upon receipt of such proceeds and payments | the related liquidation proceeds, insurance proceeds, condemnation proceeds and borrower payments | |||
Additional Special Servicing Compensation/ Outside Special Servicer
| – a specified percentage (which may be either 0% or 50% for any related Outside Serviced Mortgage Loan if it is a performing loan, and 100% if it is a specially serviced loan) of excess modification fees, consent fees, extension fees, and assumption fees with respect to any related Outside Serviced Mortgage Loan | from time to time | the related fee/ investment income | |||
– 100% of ancillary fees (other than fees for insufficient or returned checks), assumption application fees and excess penalty charges on any related Outside Serviced Mortgage Loan if it is a specially serviced loan | from time to time | |||||
– all investment income received on funds in any REO account | from time to time | |||||
Property Advances / Outside Servicer and Outside Trustee
| with respect to property advances on the Outside Serviced Loan Combination, the Outside Serviced Mortgage Loan’s pro rata share of such property advance | from time to time | recoveries on the Outside Serviced Mortgage Loan or any REO Property acquired with respect to the Outside Serviced Loan Combination, or to the extent that the party making the advance determines it is nonrecoverable, from general collections in the Collection Account established under the Pooling and Servicing Agreement (subject to certain limitations) |
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Type/Recipient | Amount(1) | Frequency | Source of Funds | |||
Interest on Property Advances / Outside Servicer and Outside Trustee
| at Prime Rate | when the advance is reimbursed | first from late payment charges and default interest on the Outside Serviced Loan Combination in excess of the regular interest rate, then from other recoveries thereon, and then from general collections in the Collection Account established under the Pooling and Servicing Agreement (subject to certain limitations) | |||
Indemnification Expenses / Depositor, Certificate Administrator, paying agent, custodian, Certificate Registrar, Trustee, Operating Advisor, Master Servicer and Special Servicer | amounts and expenses for which the Depositor, the Certificate Administrator, the paying agent, the custodian, the Certificate Registrar, the Trustee, the Operating Advisor, the Master Servicer (for itself or on behalf of certain indemnified sub-servicers) and the Special Servicer are entitled to indemnification. | from time to time | general collections | |||
Indemnification Expenses / Outside Trustee, Outside Certificate Administrator, Outside Servicer and Outside Special Servicer | with respect to amounts and expenses for which the Outside Trustee, the certificate administrator under the Outside Servicing Agreement, the Outside Servicer and the Outside Special Servicer are entitled to indemnification with respect to an Outside Serviced Loan Combination, the applicable Outside Serviced Mortgage Loan’s pro rata share of such amount or expense. | from time to time | collections on the Outside Serviced Loan Combinations and then from general collections in the Collection Account established under the Pooling and Servicing Agreement |
(1) | The above chart generally does not include amounts payable to the Master Servicer, the Special Servicer, any Outside Servicer, or any Outside Special Servicer with respect to the Companion Loans. |
Certain Affiliations and Certain Relationships
Transaction Party and Related Party Affiliations:
The Depositor and its affiliates are playing several roles in this transaction. The Depositor is an affiliate of CGMRC, a Sponsor and an Originator, Citigroup Global Markets Inc., one of the underwriters, and Citibank, the Certificate Administrator, Certificate Registrar and paying agent.
GSMC, a Sponsor and an Originator, GS CRE, an Originator, and Goldman Sachs & Co., one of the underwriters, are affiliated with each other.
Deutsche Bank Trust Company Americas, the Trustee, is also the CGCMT 2015-GC29 Trustee and as such is the mortgagee of record and custodian with respect to the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan.
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Warehouse Financing Arrangements:
Citibank, the Certificate Administrator and an affiliate of the Depositor and of CGMRC, provides warehouse financing to an affiliate of RAIT through a repurchase facility. Five (5) of the Mortgage Loans that RAIT will transfer to the Depositor, with an aggregate principal balance of approximately $25,634,229 as of the Cut-off Date and representing approximately 3.5% of the Initial Pool Balance, are subject to that repurchase facility. Proceeds received by RAIT in connection with the contribution of such Mortgage Loans to this securitization transaction will be applied, among other things, to reacquire such financed Mortgage Loans and make payments to Citibank, as the repurchase agreement counterparty.
Citibank, the Certificate Administrator and an affiliate of the Depositor and of CGMRC, provides warehouse financing to an affiliate of KGS through a repurchase facility. All of the KGS Mortgage Loans, with an aggregate principal balance of approximately $21,243,283 as of the Cut-off Date and representing approximately 2.9% of the Initial Pool Balance, are subject to that repurchase facility. Proceeds received by KGS in connection with the sale of the KGS Mortgage Loans to the Depositor will be applied, among other things, to reacquire the financed KGS Mortgage Loans and make payments to Citibank, as the repurchase agreement counterparty.
Goldman Sachs Bank USA, an affiliate of GSMC, provides warehouse financing to an affiliate of Rialto through a repurchase facility. All of the Mortgage Loans that Rialto will transfer to the Depositor, with an aggregate principal balance of approximately $90,851,031 as of the Cut-off Date and representing approximately 12.6% of the Initial Pool Balance, are subject to that repurchase facility. Proceeds received by Rialto in connection with the contribution of Mortgage Loans to this securitization transaction will be applied, among other things, to reacquire the financed Mortgage Loans and make payments to Goldman Sachs Bank USA as the repurchase agreement counterparty.
Interim Servicing Arrangements:
Pursuant to certain interim servicing agreements between Wells Fargo, which is the Master Servicer, and each of the entities indicated below, Wells Fargo acts as interim servicer with respect to:
· | certain of the Mortgage Loans (with an aggregate principal balance of approximately $224,998,805 as of the Cut-off Date and representing approximately 31.1% of the Initial Pool Balance) to be contributed to this securitization transaction by CGMRC, a Sponsor and an Originator, as well as other mortgage loans owned by CGMRC; |
· | all of the Mortgage Loans (with an aggregate principal balance of approximately $90,851,031 as of the Cut-off Date and representing approximately 12.6% of the Initial Pool Balance) to be contributed to this securitization transaction by Rialto, a Sponsor and an Originator, as well as other mortgage loans owned by Rialto; and |
· | all of the Mortgage Loans (with an aggregate principal balance of approximately $21,243,283 as of the Cut-off Date and representing approximately 2.9% of the Initial Pool Balance) to be contributed to this securitization transaction by KGS, a Sponsor and an Originator, as well as other mortgage loans owned by KGS. |
Pursuant to an interim servicing agreement between Midland, the CGCMT 2015-GC29 Servicer, the CGCMT 2015-GC29 Special Servicer, the GSMS 2015-GC30 Servicer and the GSMS 2015-GC30 Special Servicer, and GSMC, a Sponsor and an Originator, and certain of its affiliates, Midland acts as interim servicer with respect to all of the Mortgage Loans to be contributed to this securitization transaction by GSMC.
Interim and Other Custodial Arrangements:
Wells Fargo, which is the Master Servicer, is also acting as the custodian of the loan files for all of the Mortgage Loans to be contributed to this securitization.
Loan Combination and Mezzanine Loan Arrangements:
RAIT Partnership, an affiliate of RAIT, an Originator and a Sponsor, is the initial holder of a mezzanine loan in the original principal amount of $5,000,000 related to the Mortgage Loan secured by the Mortgaged Property
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identified on Annex A to this prospectus supplement as St. Anthony’s Healthplex North, representing approximately 4.1% of the Initial Pool Balance. See “Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness” in this prospectus supplement. In exercising its rights, the mezzanine lender has no obligation to consider the interests of, or the impact of the exercise of such rights upon, the Issuing Entity or the Certificateholders.
GSMC, an Originator and a Sponsor, or an affiliate thereof will, as of the date of initial issuance of the Offered Certificates, hold one of the Selig Office Portfolio Companion Loans and one of the Dallas Market Center Companion Loans, but is expected to transfer each such Companion Loan to one or more future commercial mortgage securitization transactions.
Other Arrangements:
The Master Servicer will enter into one or more agreements with the Sponsors to purchase the master servicing rights to the Mortgage Loans and/or the right to be appointed as the master servicer with respect to such Mortgage Loans and to purchase the primary servicing rights to certain of the Serviced Loans.
Eightfold Real Estate Capital Fund III, L.P. (or its affiliate), the initial controlling class representative under the CGCMT 2015-GC29 Pooling and Servicing Agreement, engaged Midland as an independent contractor to conduct due diligence with respect to each of the Selig Office Portfolio Loan Combination and the Crowne Plaza Bloomington Loan Combination.
DoubleLine Capital LP, or its affiliate, the initial controlling class representative under the GSMS 2015-GC30 Pooling and Servicing Agreement, engaged Midland as an independent contractor to conduct due diligence with respect to the Dallas Market Center Loan Combination.
These roles and other potential relationships may give rise to conflicts of interest as further described under “Risk Factors—Interests and Incentives of the Originators, the Sponsors and Their Affiliates May Not Be Aligned with Your Interests” and “—Other Potential Conflicts of Interest May Affect Your Investment” in this prospectus supplement.
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Description of the Offered Certificates
General
The Certificates will be issued pursuant to the Pooling and Servicing Agreement and will consist of 17 classes (each, a “Class”), to be designated as the Class A-1 Certificates, the Class A-2 Certificates, the Class A-3 Certificates, the Class A-4 Certificates, the Class A-AB Certificates, the Class X-A Certificates, the Class A-S Certificates, the Class B Certificates, the Class PEZ Certificates, the Class C Certificates, the Class D Certificates, the Class E Certificates, the Class F Certificates, the Class G Certificates, the Class H Certificates, the Class S Certificates and the Class R Certificates (collectively, the “Certificates”). Only the Class A-1 Certificates, the Class A-2 Certificates, the Class A-3 Certificates, the Class A-4 Certificates, the Class A-AB Certificates, the Class X-A Certificates, the Class A-S Certificates, the Class B Certificates, the Class PEZ Certificates, the Class C Certificates and the Class D Certificates (collectively, the “Offered Certificates”) are offered by this prospectus supplement. The Class X-A Certificates are also referred to as the “Class X Certificates” in this prospectus supplement. The Class A-S Certificates, the Class B Certificates, the Class PEZ Certificates and the Class C Certificates are referred to as the “Exchangeable Certificates” in this prospectus supplement. The Certificates other than the Exchangeable Certificates, the Class S Certificates and the Class R Certificates are referred to as the “Regular Certificates” in this prospectus supplement. The Offered Certificates that also constitute Regular Certificates are referred to as the “Offered Regular Certificates” in this prospectus supplement. The Class E Certificates, the Class F Certificates, the Class G Certificates, the Class H Certificates, the Class S Certificates and the Class R Certificates are not offered by this prospectus supplement.
The Certificates represent in the aggregate the entire beneficial ownership interest in the Issuing Entity consisting of: (i) the Mortgage Loans and all payments under and proceeds of the Mortgage Loans due after the Cut-off Date, (ii) any Mortgaged Property acquired on behalf of the Issuing Entity (including, in the case of an Outside Serviced Mortgage Loan, pursuant to the Outside Servicing Agreement) through foreclosure or deed-in-lieu of foreclosure (upon acquisition, each, an “REO Property”), but in the case of each Loan Combination, only to the extent of the Issuing Entity’s interest in any related REO Property, (iii) all of the Trustee’s rights in any reserve account or lock-box account (to the extent of the Issuing Entity’s interest in such reserve account or lock-box account) and such funds or assets as from time to time are deposited in the Collection Account, the Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the Interest Reserve Account, the Excess Interest Distribution Account, the Excess Liquidation Proceeds Reserve Account, the Exchangeable Distribution Account and any account established in connection with REO Properties (an “REO Account”), (iv) the Trustee’s rights in any assignment of leases, rents and profits and any security agreement, indemnity or guarantee given as additional security for the Mortgage Loans, (v) the Master Servicer’s and the Trustee’s rights under all insurance policies with respect to the Mortgage Loans and (vi) the Trustee’s rights under any environmental indemnity agreements relating to the Mortgaged Properties. The Certificates do not represent an interest in or obligation of the Depositor, the Sponsors, the Originators, the Master Servicer, the Special Servicer, the Trustee, the Certificate Administrator, the underwriters, the borrowers, the property managers or any of their respective affiliates.
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Upon initial issuance, the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB, Class A-S, Class B, Class C, Class D, Class E, Class F, Class G and Class H Certificates (collectively, the “Sequential Pay Certificates”) and the Class PEZ Certificates (collectively with the Sequential Pay Certificates, the “Principal Balance Certificates”) will have the respective Certificate Principal Amounts (or, in the case of the respective Classes of Exchangeable Certificates, the maximum Certificate Principal Amounts), and the Class X-A Certificates will have the Notional Amount, shown below (in each case, subject to a variance of plus orminus 5%):
| Initial Certificate Principal Amount | |
Class A-1 | $28,330,000 | |
Class A-2 | $2,298,000 | |
Class A-3 | $160,000,000 | |
Class A-4 | $268,724,000 | |
Class A-AB | $46,974,000 | |
Class X-A | $565,089,000 | |
Class A-S(1)(2)(3) | $58,763,000 | |
Class B(1)(2)(3) | $42,871,000 | |
Class PEZ(1)(2)(3) | $135,486,000 | |
Class C(1)(2)(3) | $33,852,000 | |
Class D | $24,284,000 | |
Class E | $11,000,000 | |
Class F | $14,864,000 | |
Class G | $12,231,000 | |
Class H | $19,132,869 |
(1) | The Class A-S, Class B and Class C Certificates may be exchanged for Class PEZ Certificates, and Class PEZ Certificates may be exchanged for the Class A-S, Class B and Class C Certificates. |
(2) | On the Closing Date, the Issuing Entity will issue the Class A-S, Class B and Class C Trust Components, which will have outstanding principal balances, subject to a variance ofplus orminus 5%, of $58,763,000, $42,871,000 and $33,852,000, respectively. The Exchangeable Certificates will, at all times, represent undivided beneficial ownership interests in a grantor trust that will hold such Trust Components. Each Class of the Exchangeable Certificates will, at all times, represent a beneficial interest in a percentage of the outstanding principal balance of the Class A-S, Class B and/or Class C Trust Components. Following any exchange of Class A-S, Class B and Class C Certificates for Class PEZ Certificates or any exchange of Class PEZ Certificates for Class A-S, Class B and Class C Certificates, the percentage interests of the outstanding principal balances of the Class A-S, Class B and Class C Trust Components that is represented by the Class A-S, Class B, Class PEZ and Class C Certificates will be increased or decreased accordingly. |
(3) | The initial Certificate Principal Amount of each Class of the Class A-S, Class B and Class C Certificates shown in the table on the cover page of this prospectus supplement, in the table above and on the back cover of this prospectus supplement represents the maximum Certificate Principal Amount of such Class without giving effect to any issuance of Class PEZ Certificates. The initial Certificate Principal Amount of the Class PEZ Certificates shown in the table on the cover page of this prospectus supplement, in the table above and on the back cover of this prospectus supplement is equal to the aggregate of the maximum initial Certificate Principal Amounts of the Class A-S, Class B and Class C Certificates, representing the maximum Certificate Principal Amount of the Class PEZ Certificates that could be issued in an exchange. The actual Certificate Principal Amount of any Class of Exchangeable Certificates issued on the Closing Date may be less than the maximum Certificate Principal Amount of that Class and may be zero. The Certificate Principal Amounts of the Class A-S, Class B and Class C Certificates to be issued on the Closing Date will be reduced, in required proportions, by an amount equal to the Certificate Principal Amount of the Class PEZ Certificates issued on the Closing Date. The initial Certificate Principal Amount of any Trust Component will equal the initial Certificate Principal Amount of the Class of Exchangeable Certificates having the same alphabetical designation as that Trust Component without regard to any exchange of such Certificates for Class PEZ Certificates. The aggregate Certificate Principal Amount of the Offered Certificates shown on the cover page and back cover of this prospectus supplement includes the maximum Certificate Principal Amount of Exchangeable Certificates that could be outstanding on the Closing Date equal to $135,486,000 (subject to a variance ofplus orminus 5%). |
The aggregate principal amount (the “Certificate Principal Amount”) of any Class of Principal Balance Certificates or Trust Component outstanding at any time represents the maximum amount that its holders (or, in the case of a Trust Component, the holders of Exchangeable Certificates evidencing an interest in that Trust Component) are entitled to receive at such time as distributions allocable to principal from the cash flow on the Mortgage Loans and the other assets in the Issuing Entity, all as described in this prospectus supplement. As discussed below, each Class of Exchangeable Certificates will only receive distributions of principal and interest that are distributable with respect to the percentage interests in the Class A-S, Class B and/or Class C Trust Components represented by such Class of Exchangeable Certificates. See “—Distributions”below. The Certificate Principal Amount of each Class of Principal Balance Certificates or Trust Component will in each case be reduced by amounts actually distributed to that Class or Trust Component that are allocable to principal and by any Realized Losses allocated to that Class or Trust Component and may be increased by recoveries of such Realized Losses as described under “—Distributions—Realized Losses” below. In addition, amounts determined
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to constitute recoveries of Non-Recoverable Advances that were previously reimbursed out of collections of principal on the Mortgage Loans may result in increases to the Certificate Principal Amount of a Class of Sequential Pay Certificates or Trust Component, as and to the extent described under “—Distributions—Realized Losses” below. In the event that Realized Losses previously allocated to a Class of Sequential Pay Certificates (exclusive of the Exchangeable Certificates) or Trust Component (and, therefore, the applicable Exchangeable Certificates) in reduction of its Certificate Principal Amount are recovered subsequent to the reduction of the Certificate Principal Amount of such Class or Trust Component to zero, holders of such Class, or of Exchangeable Certificates evidencing an interest in such Trust Component, may receive distributions in respect of such recoveries in accordance with the priorities set forth below under “—Distributions—Payment Priorities”in this prospectus supplement.
The Class X-A Certificates will not have Certificate Principal Amounts. The Class X-A Certificates will represent in the aggregate the right to receive distributions of interest accrued as described in this prospectus supplement on their notional principal amount (a “Notional Amount”). The Notional Amount of the Class X-A Certificates will equal the sum of the Certificate Principal Amounts of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates and Class A-S Trust Component from time to time. The Notional Amount of the Class X-A Certificates will be reduced to the extent of all reductions in the Certificate Principal Amounts of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates and the Class A-S Trust Component. The Class S Certificates will not have a Certificate Principal Amount or Notional Amount and will be entitled to receive only Excess Interest received on the ARD Loans.
“Class A-S Percentage Interest” means, the quotient of the Certificate Principal Amount of the Class A-S Certificates divided by the Certificate Principal Amount of the Class A-S Trust Component. As of the Closing Date, the Class A-S Percentage Interest will be 100%.
“Class A-S Trust Component” means an interest issued as a regular interest in the Upper-Tier REMIC with a Pass-Through Rate equal to the Pass-Through Rate of the Class A-S Certificates. The Class A-S Certificates will represent beneficial ownership of the Class A-S Percentage Interest of the Class A-S Trust Component, and the Class PEZ Certificates will represent beneficial ownership of, among other things, the Class A-S-PEZ Percentage Interest of the Class A-S Trust Component. The Class A-S Trust Component will be held in the Grantor Trust.
“Class A-S-PEZ Percentage Interest” means 100%minus the Class A-S Percentage Interest. As of the Closing Date, the Class A-S-PEZ Percentage Interest will be 0%.
“Class B Percentage Interest” means, the quotient of the Certificate Principal Amount of the Class B Certificates divided by the Certificate Principal Amount of the Class B Trust Component. As of the Closing Date, the Class B Percentage Interest will be 100%.
“Class B Trust Component” means an interest issued as a regular interest in the Upper-Tier REMIC with a Pass-Through Rate equal to the Pass-Through Rate of the Class B Certificates. The Class B Certificates will represent beneficial ownership of the Class B Percentage Interest of the Class B Trust Component, and the Class PEZ Certificates will represent beneficial ownership of, among other things, the Class B-PEZ Percentage Interest of the Class B Trust Component. The Class B Trust Component will be held in the Grantor Trust.
“Class B-PEZ Percentage Interest” means 100%minus the Class B Percentage Interest. As of the Closing Date, the Class B-PEZ Percentage Interest will be 0%.
“Class C Percentage Interest” means, the quotient of the Certificate Principal Amount of the Class C Certificates divided by the Certificate Principal Amount of the Class C Trust Component. As of the Closing Date, the Class C Percentage Interest will be 100%.
“Class C Trust Component” means an interest issued as a regular interest in the Upper-Tier REMIC with a Pass-Through Rate equal to the Pass-Through Rate of the Class C Certificates. The Class C Certificates will represent beneficial ownership of the Class C Percentage Interest of the Class C Trust Component, and the Class PEZ Certificates will represent beneficial ownership of, among other things, the Class C-PEZ Percentage Interest of the Class C Trust Component. The Class C Trust Component will be held in the Grantor Trust.
“Class C-PEZ Percentage Interest” means 100%minus the Class C Percentage Interest. As of the Closing Date, the Class C-PEZ Percentage Interest will be 0%.
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“Class PEZ Component” means any of the Class PEZ Component A-S, Class PEZ Component B or Class PEZ Component C.
“Class PEZ Component A-S” means the portion of the Class A-S Trust Component equal to the Class A-S-PEZ Percentage Interest of the Class A-S Trust Component.
“Class PEZ Component B” means the portion of the Class B Trust Component equal to the Class B-PEZ Percentage Interest of the Class B Trust Component.
“Class PEZ Component C” means the portion of the Class C Trust Component equal to the Class C-PEZ Percentage Interest of the Class C Trust Component.
“Trust Component” means any of the Class A-S Trust Component, Class B Trust Component or Class C Trust Component.
Exchangeable Certificates
Exchanges
Groups of Class A-S, Class B and Class C Certificates may be exchanged for Class PEZ Certificates and vice versa, in whole or in part, as described more fully below. This process may occur repeatedly. However, exchanges will no longer be permitted following the date when the Certificate Principal Amount of the Class A-S Trust Component is (and, correspondingly, the Certificate Principal Amount of the Class A-S Certificates and the principal balance of the Class PEZ Component A-S are) reduced to zero as a result of the payment in full of all interest and principal on that Trust Component.
Following the Closing Date, Class A-S, Class B and Class C Certificates that collectively evidence a uniform Tranche Percentage Interest in each Trust Component (such Certificates in the aggregate, an “Exchangeable Proportion”) will be exchangeable on the books of DTC for Class PEZ Certificates that represent the same Tranche Percentage Interest in each Trust Component as the Certificates to be surrendered, and any Class PEZ Certificates will be exchangeable on the books of DTC for Class A-S, Class B and Class C Certificates that evidence the same Tranche Percentage Interest in each Trust Component as the Class PEZ Certificates to be surrendered. For these purposes, the “Tranche Percentage Interest” of any Certificate in relation to a Trust Component is the ratio, expressed as a percentage, of (a) the Certificate Principal Amount of that Certificate (or, in the case of a Class PEZ Certificate, the portion of the principal amount of the Class PEZ Component with the same letter designation as that Trust Component evidenced by such Certificate) to (b) the Certificate Principal Amount of that Trust Component.
There will be no limitation on the number of exchanges authorized under the exchange provisions of the Pooling and Servicing Agreement. In all cases, however, an exchange may not occur if the face amount of the Certificates to be received in the exchange would not represent an authorized denomination for the relevant Class as described under “—Delivery, Form, Transfer and Denomination”below. In addition, the Depositor will have the right to make or cause exchanges on the Closing Date pursuant to instructions delivered to the Certificate Administrator on the Closing Date.
The various amounts distributable on the Class PEZ Certificates on each Distribution Date in respect of Interest Accrual Amounts, Interest Distribution Amounts, Interest Shortfalls, Principal Distribution Amounts, reimbursements of Realized Losses, yield maintenance charges and excess liquidation proceeds allocated to any of the respective aggregate Tranche Percentage Interests in the Class A-S, Class B and Class C Trust Components represented by the Class PEZ Certificates will be so distributed in a single, aggregate distribution to the holders of the Class PEZ Certificates on such Distribution Date. In addition, the Class PEZ Certificates will be allocated the aggregate amount of Realized Losses, Interest Shortfalls and other interest shortfalls (including those resulting from Appraisal Reduction Events) corresponding to the respective aggregate Tranche Percentage Interests in the Class A-S, Class B and Class C Trust Components represented by the Class PEZ Certificates. See “—Distributions”below.
For a discussion of the federal income tax consequences of the acquisition, ownership and disposition of the Exchangeable Certificates, see “Material Federal Income Tax Consequences—Taxation of the Exchangeable Certificates” in this prospectus supplement.
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Procedures and Fees
If a Certificateholder wishes to exchange Class A-S, Class B and Class C Certificates for Class PEZ Certificates, or Class PEZ Certificates for Class A-S, Class B and Class C Certificates, such Certificateholder must notify the Certificate Administrator by e-mail at ctssfexchanges@citi.com no later than 3 business days prior to the proposed date of such exchange (the “Exchange Date”). The Exchange Date can be any business day other than the first or last business day of the month. In addition, the Certificateholder must provide notice on the Certificateholder’s letterhead, which notice must carry a medallion stamp guarantee and set forth the following information: the CUSIP numbers of the Exchangeable Certificates to be exchanged and received, the original and outstanding Certificate Principal Amount of the Exchangeable Certificates to be exchanged and of the Exchangeable Certificates to be received, the Certificateholder’s DTC participant number and the proposed Exchange Date. After receiving the notice, the Certificate Administrator will be required to e-mail the Certificateholder (at such address specified in writing by such Certificateholder) with wire payment instructions relating to the exchange fee. The Certificateholder and the Certificate Administrator will utilize the “deposit and withdrawal system” at DTC to effect the exchange.
The aggregate principal and interest entitlements of the Certificates received will equal the aggregate entitlements of principal and interest of the Certificates surrendered. The notice of exchange will become irrevocable on the 2nd business day before the proposed Exchange Date.
In connection with each exchange, the Certificateholder must pay the Certificate Administrator an exchange fee of $5,000 (together with any other expenses related to such exchange (including fees charged by DTC), and such fee (and expenses) must be received by the Certificate Administrator prior to the Exchange Date or such exchange will not be effected. The first distribution on an Exchangeable Certificate received pursuant to an exchange will be made in the month following the month of exchange to the Certificateholder of record as of the applicable Record Date for such Certificate. None of the Certificate Administrator, the Trustee or the Depositor will have any obligation to ensure the availability of the applicable Certificates to accomplish any exchange.
Distributions
Method, Timing and Amount
Distributions on the Certificates are required to be made on the 4th business day following the related Determination Date of each month (each, a “Distribution Date”), commencing in August 2015. All distributions (other than the final distribution on any Certificate) are required to be made by the Certificate Administrator to the persons in whose names the Certificates are registered at the close of business on the last day of the month immediately preceding the month in which the related Distribution Date occurs (or, if such day is not a business day, the immediately preceding business day) (that date, the “Record Date”). Distributions are required to be made (a) by wire transfer in immediately available funds to the account specified by the Certificateholder at a bank or other entity having appropriate facilities for such payment, if the Certificateholder provides the Certificate Administrator with wiring instructions no less than five business days prior to the related Record Date, or otherwise (b) by check mailed to the Certificateholder. The final distribution on any Certificates is required to be made in like manner, but only upon presentment and surrender of the Certificate at the location specified in the notice to the Certificateholder of such final distribution. All distributions made with respect to a Class of Offered Certificates on each Distribution Date will be allocated pro rata among the outstanding Certificates of such Class based on their respective Percentage Interests. The “Percentage Interest” evidenced by: (a) any Certificate (other than a Class S or Class R Certificate) will equal its initial denomination as of the Closing Date divided by the initial Certificate Principal Amount or Notional Amount, as applicable, of the related Class; and (b) any Class S Certificate or Class R Certificate will be the percentage interest in the applicable Class specified on the face of that Certificate. For these purposes on any date of determination, the “initial denomination as of the Closing Date” of any Exchangeable Certificate received in an exchange will be determined as if such Certificate was part of the related Class on the Closing Date, the “initial denomination as of the Closing Date” of any Exchangeable Certificate surrendered in an exchange will be determined as if such Certificate wasnot part of the related Class on the Closing Date and the initial Certificate Principal Amount of the related Class of Exchangeable Certificates will be determined as if such Class consisted only of the Certificates composing the Class on that date of determination and such Certificates had been outstanding as of the Closing Date.
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The aggregate distribution to be made on the Certificates on any Distribution Date (exclusive of distributions of Excess Interest, yield maintenance charges and prepayment premiums) will equal the Available Funds. The “Available Funds” for a Distribution Date will, in general, equal the sum of the following amounts (without duplication):
(i) the total amount of all cash received on the Mortgage Loans and any REO Properties that are on deposit in the Collection Account and the Lower-Tier Distribution Account, as of the close of business on the business day immediately preceding the related Master Servicer Remittance Date, exclusive of (without duplication) any portion of the foregoing that represents:
(A) all Monthly Payments and balloon payments collected but due on a Due Date (without regard to grace periods) that occurs after the end of the related Collection Period;
(B) all unscheduled payments of principal (including prepayments) and interest, net liquidation proceeds, net insurance proceeds and Net Condemnation Proceeds and other unscheduled recoveries, together with any Monthly Payments and any balloon payments, that were received after the related Determination Date (other than the monthly remittance on the Outside Serviced Mortgage Loans or the Issuing Entity’s interest in any related REO Property contemplated by clause (ii) of this definition);
(C) all amounts in the Collection Account that are due or reimbursable to any person other than the Certificateholders;
(D) with respect to each Mortgage Loan that accrues interest on an Actual/360 Basis and any Distribution Date occurring in January (except in a leap year) or February of each calendar year (commencing in 2016) (unless, in either case, such Distribution Date is the final Distribution Date), the related Withheld Amount to the extent those funds are on deposit in the Collection Account and held pending transfer to the Interest Reserve Account;
(E) all amounts representing Excess Interest;
(F) all yield maintenance charges and prepayment premiums;
(G) all amounts deposited in the Collection Account or the Lower-Tier Distribution Account in error; and
(H) any late payment charges, any default interest received on any Mortgage Loan in excess of interest calculated at the Mortgage Loan Rate for the Mortgage Loan and any similar fees and charges;
(ii) if and to the extent not already included in clause (i) above, the aggregate amount transferred from any REO Account to the Collection Account for such Distribution Date pursuant to the Pooling and Servicing Agreement and the remittance received on the Outside Serviced Mortgage Loans or the Issuing Entity’s interest in any related REO Property in the month of such Distribution Date, to the extent that each such transfer is made or such remittance is received by the close of business on the business day immediately preceding the related Master Servicer Remittance Date;
(iii) all Compensating Interest Payments made by the Master Servicer with respect to such Distribution Date and all P&I Advances made by the Master Servicer or the Trustee, as applicable, with respect to such Distribution Date (net of certain amounts that are due or reimbursable to persons other than the Certificateholders); and
(iv) for the Distribution Date occurring in each March (or February if the final Distribution Date occurs in that month), the related Withheld Amounts required to be deposited in the Lower-Tier Distribution Account pursuant to the Pooling and Servicing Agreement.
“Monthly Payment” with respect to any Mortgage Loan or Serviced Companion Loan (other than any REO Mortgage Loan or REO Companion Loan) and any Due Date is the scheduled monthly payment of principal (if
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any) and interest at the related Mortgage Loan Rate which is payable by the related borrower on such Due Date. The Monthly Payment with respect to any Due Date for (i) an REO Mortgage Loan or REO Companion Loan, (ii) any Mortgage Loan or Serviced Companion Loan that is delinquent at its maturity date and with respect to which the Special Servicer has not entered into an extension or (iii) any ARD Loan after the related Anticipated Repayment Date, is the monthly payment that would otherwise have been payable on such Due Date had the related Mortgage Note not been discharged or the related maturity date or Anticipated Repayment Date, as applicable, had not been reached, as the case may be, determined as set forth in the Pooling and Servicing Agreement. The Monthly Payment for any Serviced Loan Combination is the aggregate Monthly Payment for the related Mortgage Loan and Serviced Companion Loan.
“Net Condemnation Proceeds” are the Condemnation Proceeds received with respect to any Mortgage Loan or Serviced Companion Loan (including an REO Mortgage Loan or REO Companion Loan) net of the amount of (i) costs and expenses incurred with respect thereto and (ii) amounts required to be applied to the restoration or repair of the related Mortgaged Property.
“Condemnation Proceeds” are all of the proceeds received in connection with the taking of all or a part of a Mortgaged Property or REO Property (including with respect to each Outside Serviced Mortgage Loan and including any Mortgaged Property or REO Property securing a Serviced Companion Loan) by exercise of the power of eminent domain or condemnation, subject, however, to the rights of any tenants and ground lessors, as the case may be, and the terms of the related Mortgage. In the case of an Outside Serviced Mortgage Loan, “Condemnation Proceeds” means any portion of such proceeds received by the Issuing Entity in connection with such Outside Serviced Mortgage Loan, pursuant to the allocations set forth in the related Co-Lender Agreement.
“Collection Period” with respect to a Distribution Date and each Mortgage Loan (including an REO Mortgage Loan) is the period beginning on the day immediately following the Due Date (without regard to grace periods) in the month preceding the month in which such Distribution Date occurs (or, in the case of the Distribution Date occurring in August 2015, beginning on the day after the Cut-off Date) and ending on and including the Due Date (without regard to grace periods) in the month in which such Distribution Date occurs.
“Determination Date” with respect to any Distribution Date is the sixth day of the calendar month of the related Distribution Date or, if the sixth day is not a business day, the next business day, commencing in August 2015.
Payment Priorities
As used below in describing the priorities of distribution of Available Funds for each Distribution Date, the terms set forth below will have the following meanings:
The “Interest Accrual Amount” with respect to any Distribution Date and any Class of Regular Certificates or any Trust Component is equal to interest for the related Interest Accrual Period accrued at the Pass-Through Rate for such Class or Trust Component on the related Certificate Principal Amount or Notional Amount, as applicable, immediately prior to that Distribution Date. Calculations of interest on the Regular Certificates and the Trust Components will be made on the basis of a 360-day year consisting of twelve 30-day months.
The “Interest Accrual Period” with respect to any Distribution Date is the calendar month preceding the month in which such Distribution Date occurs. Each Interest Accrual Period with respect to each Class of Sequential Pay Certificates and Class X Certificates and each Trust Component is assumed to consist of 30 days.
The “Interest Distribution Amount” with respect to any Distribution Date and each Class of Regular Certificates and each Trust Component will equal (A) the sum of (i) the Interest Accrual Amount with respect to such Class or Trust Component for such Distribution Date and (ii) the Interest Shortfall, if any, with respect to such Class or Trust Component for such Distribution Date,less (B) any Excess Prepayment Interest Shortfall allocated to such Class or Trust Component on such Distribution Date.
An “Interest Shortfall” with respect to any Distribution Date for any Class of Regular Certificates or any Trust Component, in general, is the sum of (A) the portion of the Interest Distribution Amount for such Class or Trust Component remaining unpaid as of the close of business on the preceding Distribution Date (if any), and (B) to the extent permitted by applicable law, (i) other than in the case of the Class X Certificates, one month’s interest on that amount remaining unpaid at the Pass-Through Rate applicable to such Class of Certificates or Trust
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Component for the current Distribution Date and (ii) in the case of the Class X Certificates, one-month’s interest on that amount remaining unpaid at the WAC Rate for such Distribution Date.
The “Pass-Through Rate” with respect to any Class of Sequential Pay Certificates, the Class X Certificates or any Trust Component for any Interest Accrual Period and the related Distribution Date is the per annum rate at which interest accrues on the Certificates of such Class or Trust Component during such Interest Accrual Period.
The Pass-Through Rate with respect to each Class of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates for any Distribution Date will be fixed at the initial Pass-Through Rate for such Class set forth in the table under “Certificate Summary” in this prospectus supplement.
The Pass-Through Rate with respect to the Class A-S Certificates for any Distribution Date will be a per annum rate equal to the WAC Rate for such Distribution Date, less 0.001%.
The Pass-Through Rate with respect to each Class of the Class B, Class C, Class D, Class E, Class F, Class G and Class H Certificates for any Distribution Date will be a per annum rate equal to the WAC Rate for such Distribution Date.
The Pass-Through Rate on the Class X-A Certificates is variable and, for each Distribution Date, will be a per annum rate equal to the weighted average of the Class X Strip Rates for the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates and the Class A-S Trust Component for such Distribution Date (weighted on the basis of the respective Certificate Principal Amounts of such Classes of Certificates and such Trust Component immediately prior to such Distribution Date).
The Pass-Through Rates for the Class A-S Certificates and the Class A-S Trust Component will, at all times, be the same. The Pass-Through Rates for the Class B Certificates and the Class B Trust Component will, at all times, be the same. The Pass-Through Rates for the Class C Certificates and the Class C Trust Component will, at all times, be the same.
The Class PEZ Certificates will not have a Pass-Through Rate, but will be entitled to receive the sum of the interest distributable on the percentage interests of the Class A-S, Class B and Class C Trust Components represented by the Class PEZ Certificates.
The “Class X Strip Rate” for each Class of Sequential Pay Certificates (other than the Exchangeable Certificates) and each Trust Component for any Distribution Date will be a per annum rate equal to the excess of (i) the WAC Rate for such Distribution Dateover (ii) the Pass-Through Rate on such Class of Sequential Pay Certificates or Trust Component for such Distribution Date.
The “WAC Rate” with respect to any Distribution Date is a per annum rate equal to the weighted average of the Net Mortgage Loan Rates in effect for the Mortgage Loans (including the REO Mortgage Loans) as of their respective Due Dates in the month preceding the month in which such Distribution Date occurs, weighted on the basis of the respective Stated Principal Balances of the Mortgage Loans immediately following the Distribution Date (or, if applicable, the Closing Date) in such preceding month.
The “Net Mortgage Loan Rate” with respect to any Mortgage Loan (including any REO Mortgage Loan) is a per annum rate equal to the related Mortgage Loan Rateminus the related Administrative Fee Rate. Notwithstanding the foregoing, for purposes of calculating Pass-Through Rates and the WAC Rate, the Net Mortgage Loan Rate of each Mortgage Loan that accrues interest on an Actual/360 Basis for any one-month period preceding a related Due Date will be the annualized rate at which interest would have to accrue in respect of such Mortgage Loan on the basis of a 360-day year consisting of twelve 30-day months in order to produce the aggregate amount of interest actually accrued (exclusive of default interest and Excess Interest) in respect of such Mortgage Loan during such one-month period at a per annum rate equal to the related Mortgage Loan Rateminus the related Administrative Fee Rate. However, for purposes of calculating Pass-Through Rates and the WAC Rate, with respect to each Mortgage Loan that accrues interest on an Actual/360 Basis, (i) the Net Mortgage Loan Rate for the one-month period preceding the Due Dates in January and February in any year which is not a leap year and in February in any year which is a leap year (unless, in either case, the related Distribution Date is the final Distribution Date) will be determined based on the “aggregate amount of interest actually accrued”, as referred to above in the preceding sentence, being net of the related Withheld Amounts and (ii) the Net Mortgage Loan Rate for the one-month period preceding the Due Date in March will be determined
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based on the “aggregate amount of interest actually accrued”, as referred to above in the preceding sentence, taking into account the addition of any such Withheld Amounts. Also, for purposes of calculating Pass-Through Rates and the WAC Rate, the Net Mortgage Loan Rate of any Mortgage Loan will be determined without regard to any modification, waiver or amendment of the terms of such Mortgage Loan, whether agreed to by the Special Servicer or an Outside Special Servicer or resulting from a bankruptcy, insolvency or similar proceeding involving the related borrower, and without regard to the related Mortgaged Property becoming an REO Property.
The “Administrative Fee Rate” for any Mortgage Loan (including any REO Mortgage Loan) as of any date of determination will be equal to the sum of the CREFC® Intellectual Property Royalty License Fee Rate, the Servicing Fee Rate, the Operating Advisor Fee Rate and the Trustee/Certificate Administrator Fee Rate.
“CREFC® Intellectual Property Royalty License Fee” will accrue with respect to each Mortgage Loan (including any REO Mortgage Loan) at the per annum rate equal to 0.0005% calculated on the basis of the Stated Principal Balance of the related Mortgage Loan on the same basis as interest is calculated on the related Mortgage Loan and will be prorated for partial periods, and will be payable monthly from general collections on all the Mortgage Loans and any REO Properties.
The “Mortgage Loan Rate” with respect to any Mortgage Loan or Serviced Companion Loan (including any REO Mortgage Loan or REO Companion Loan) is the per annum rate at which interest accrues on such Mortgage Loan or Serviced Companion Loan, as stated in the related Mortgage Note in each case without giving effect to the default rate, Excess Interest or the Revised Rate.
The “Stated Principal Balance” of each Mortgage Loan will initially equal its Cut-off Date Balance (or in the case of a Qualified Substitute Mortgage Loan, the unpaid principal balance of such Mortgage Loan after application of all scheduled payments of principal and interest due during or prior to the month of substitution, whether or not received) and, on each Distribution Date, will be reduced by any and all amounts (without duplication) described in clauses (a)(1), (a)(2) and (a)(3) of the definition of “Principal Distribution Amount” below that are allocable to such Mortgage Loan for such Distribution Date.
The Stated Principal Balance of each Serviced Companion Loan will initially equal its unpaid principal balance as of the Cut-off Date, after application of all scheduled payments of principal and interest due on or before the Cut-off Date, whether or not received, and on each Distribution Date, will be reduced by any payments or other collections of principal on such Serviced Companion Loan that are received by the holder thereof in the month of such Distribution Date.
The Stated Principal Balance of a Mortgage Loan or Serviced Companion Loan may also be reduced in connection with any modification that reduces the principal amount due on such Mortgage Loan or Serviced Companion Loan, as the case may be, or any forced reduction of its actual unpaid principal balance imposed by a court presiding over a bankruptcy proceeding in which the related borrower is the debtor. See “Certain Legal Aspects of the Mortgage Loans—Bankruptcy Issues” in the prospectus. If any Mortgage Loan or Serviced Companion Loan is paid in full or such Mortgage Loan or Serviced Companion Loan (or any Mortgaged Property acquired in respect of the Mortgage Loan or any Serviced Loan Combination, if applicable) is otherwise liquidated, then, as of the first Distribution Date that follows the first Determination Date on or before which the payment in full or liquidation occurred and notwithstanding that a loss may have occurred in connection with any liquidation, the Stated Principal Balance of the Mortgage Loan or Serviced Companion Loan, as the case may be, will be zero. The “Stated Principal Balance” of a Serviced Loan Combination, as of any date of determination, is equal to the then aggregate Stated Principal Balance of the related Serviced Mortgage Loan and Serviced Companion Loan.
The “Principal Distribution Amount” for any Distribution Date will be equal to:
(a) | the sum, without duplication, of: |
(1) the principal component of all scheduled Monthly Payments and balloon payments due on the Mortgage Loans (including the REO Mortgage Loans) on their respective Due Dates immediately preceding such Distribution Date (if and to the extent received by the Master Servicer by the related Determination Date (or, in the case of the Outside Serviced Mortgage Loans, by the business day immediately preceding the related Master Servicer Remittance Date) or (other than balloon payments) advanced by the Master Servicer or Trustee in respect of such Distribution Date);
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(2) the principal component of any payment on any Mortgage Loan received or applied on or after the date on which such payment was due which is on deposit in the Collection Account as of the related Determination Date (or, in the case of the Outside Serviced Mortgage Loans, as of the business day immediately preceding the related Master Servicer Remittance Date), net of the principal portion of any unreimbursed P&I Advances related to such Mortgage Loan;
(3) the Unscheduled Payments with respect to the Mortgage Loans (including the REO Mortgage Loans) with respect to such Distribution Date; and
(4) the Principal Shortfall, if any, for such Distribution Date, less
(b) | the sum, without duplication, of the amount of any reimbursements of: |
(1) Non-Recoverable Advances, with interest on such Non-Recoverable Advances, that are paid or reimbursed to the Master Servicer and/or the Trustee from principal collected on the Mortgage Loans in a period during which such principal collections would have otherwise been included in the Principal Distribution Amount for such Distribution Date; and
(2) Workout-Delayed Reimbursement Amounts that are paid or reimbursed to the Master Servicer and/or the Trustee from principal collected on the Mortgage Loans in a period during which such principal collections would have otherwise been included in the Principal Distribution Amount for such Distribution Date;
provided that, if any of the amounts of the type described in clauses (b)(1) and (b)(2) above that were allocated to reduce the Principal Distribution Amount for a prior Distribution Date are subsequently recovered, such recovery will be added to the Principal Distribution Amount for the Distribution Date related to the applicable one-month period in which such recovery occurs.
The “Principal Shortfall” for any Distribution Date means the amount, if any, by which (i) the Principal Distribution Amount for the preceding Distribution Date exceeds (ii) the aggregate amount actually distributed on such preceding Distribution Date in respect of such Principal Distribution Amount.
The “Unscheduled Payments” for any Distribution Date will equal the aggregate of: (a) all prepayments of principal received on the Mortgage Loans during the applicable one-month period ending on the related Determination Date (or, in the case of the Outside Serviced Mortgage Loans, all principal prepayments received during the period that renders them includable in the Available Funds for such Distribution Date); and (b) any other collections (exclusive of payments by borrowers) received on the Mortgage Loans and any REO Properties (or the Issuing Entity’s interest in any Mortgaged Property acquired through foreclosure or deed-in-lieu of foreclosure with respect to an Outside Serviced Mortgage Loan) during the applicable one-month period ending on the related Determination Date (or, in the case of an Outside Serviced Mortgage Loan or any interest in REO Property acquired with respect thereto, all such proceeds received during the period that renders them includable in the Available Funds for such Distribution Date), whether in the form of Liquidation Proceeds, insurance proceeds, condemnation proceeds, net income, rents, and profits from any REO Property or otherwise, that were identified and applied by the Master Servicer and/or, in the case of an Outside Serviced Mortgage Loan, the Outside Servicer, as recoveries of previously unadvanced principal of the related Mortgage Loan, and, in the case of Liquidation Proceeds, insurance proceeds and condemnation proceeds, net of any Special Servicing Fees, Liquidation Fees, accrued interest on Advances and other additional expenses of the Issuing Entity incurred in connection with the related Mortgage Loan.
An “REO Mortgage Loan” is any Mortgage Loan as to which the related Mortgaged Property has become an REO Property (including, in the case of the Outside Serviced Mortgage Loans, if the related Mortgaged Property has been acquired through foreclosure or deed-in-lieu of foreclosure under an Outside Servicing Agreement).
An “REO Companion Loan” is any Serviced Companion Loan as to which the related Mortgaged Property has become an REO Property.
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On each Distribution Date, the Available Funds are required to be distributed in the following amounts and order of priority:
First, to the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class X-A Certificates, in respect of interest, up to an amount equal to, and pro rata in accordance with, the respective Interest Distribution Amounts for those Classes;
Second, to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates, in reduction of the Certificate Principal Amounts of those Classes, in the following priority:
(i) to the Class A-AB Certificates, in an amount equal to the lesser of the Principal Distribution Amount for such Distribution Date and the amount necessary to reduce the Certificate Principal Amount of the Class A-AB Certificates to the scheduled principal balance set forth on Annex F to this prospectus supplement with respect to the Class A-AB Certificates (the “Class A-AB Scheduled Principal Balance”) for such Distribution Date;
(ii) to the Class A-1 Certificates, in an amount equal to the Principal Distribution Amount (or the portion of it remaining after payments specified in clause (i) above) for such Distribution Date, until the Certificate Principal Amount of the Class A-1 Certificates is reduced to zero;
(iii) to the Class A-2 Certificates, in an amount equal to the Principal Distribution Amount (or the portion of it remaining after payments specified in clauses (i) and (ii) above) for such Distribution Date, until the Certificate Principal Amount of the Class A-2 Certificates is reduced to zero;
(iv) to the Class A-3 Certificates, in an amount equal to the Principal Distribution Amount (or the portion of it remaining after payments specified in clauses (i) through (iii) above) for such Distribution Date, until the Certificate Principal Amount of the Class A-3 Certificates is reduced to zero;
(v) to the Class A-4 Certificates, in an amount equal to the Principal Distribution Amount (or the portion of it remaining after payments specified in clauses (i) through (iv) above) for such Distribution Date, until the Certificate Principal Amount of the Class A-4 Certificates is reduced to zero; and
(vi) to the Class A-AB Certificates, in an amount equal to the Principal Distribution Amount (or the portion of it remaining after payments specified in clauses (i) through (v) above) for such Distribution Date, until the Certificate Principal Amount of the Class A-AB Certificates is reduced to zero;
Third, to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates, up to an amount equal to, and pro rata based upon, the aggregate unreimbursed Realized Losses previously allocated to reduce the Certificate Principal Amount of each such Class, plus interest on that amount at the Pass-Through Rate for such Class compounded monthly from the date the related Realized Loss was allocated to such Class;
Fourth, to the Class A-S Trust Component and, thus, concurrently, to the Class A-S Certificates, in respect of interest, up to an amount equal to the Class A-S Percentage Interest multiplied by the aggregate Interest Distribution Amount with respect to the Class A-S Trust Component, and to the Class PEZ Certificates, in respect of interest, up to an amount equal to the Class A-S-PEZ Percentage Interest multiplied by the aggregate Interest Distribution Amount with respect to the Class A-S Trust Component, pro rata in proportion to their respective percentage interests in the Class A-S Trust Component;
Fifth, to the Class A-S Trust Component and, thus, concurrently, to the Class A-S Certificates, in reduction of their Certificate Principal Amount, up to an amount equal to the Class A-S Percentage Interest multiplied by the Principal Distribution Amount for such Distribution Date,less the portion of such Principal Distribution Amount distributed pursuant to all prior clauses, and to the Class PEZ Certificates, in reduction of their Certificate Principal Amount, up to an amount equal to the Class A-S-PEZ Percentage Interest multiplied by the Principal Distribution Amount for such Distribution Date,less the portion of such Principal Distribution Amount distributed pursuant to all prior clauses, pro rata in proportion to their respective percentage interests in the Class A-S Trust Component, until the Certificate Principal Amount of the Class A-S Trust Component is reduced to zero;
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Sixth, to the Class A-S Trust Component and, thus, concurrently, to the Class A-S Certificates, up to an amount equal to the Class A-S Percentage Interest multiplied by the aggregate of unreimbursed Realized Losses previously allocated to reduce the Certificate Principal Amount of the Class A-S Trust Component, plus interest on that amount at the Pass-Through Rate for such Trust Component compounded monthly from the date the related Realized Loss was allocated to such Trust Component, and to the Class PEZ Certificates, up to an amount equal to the Class A-S-PEZ Percentage Interest multiplied by the aggregate of unreimbursed Realized Losses previously allocated to the Class A-S Trust Component,plus interest on that amount at the Pass-Through Rate for such Trust Component compounded monthly from the date the related Realized Loss was allocated to such Trust Component, pro rata in proportion to their respective percentage interests in the Class A-S Trust Component;
Seventh, to the Class B Trust Component, and, thus, concurrently, to the Class B Certificates, in respect of interest, up to an amount equal to the Class B Percentage Interest multiplied by the aggregate Interest Distribution Amount with respect to the Class B Trust Component, and to the Class PEZ Certificates, in respect of interest, up to an amount equal to the Class B-PEZ Percentage Interest multiplied by the aggregate Interest Distribution Amount with respect to the Class B Trust Component, pro rata in proportion to their respective percentage interests in the Class B Trust Component;
Eighth, to the Class B Trust Component, and, thus, concurrently, to the Class B Certificates, in reduction of their Certificate Principal Amount, up to an amount equal to the Class B Percentage Interest multiplied by the Principal Distribution Amount for such Distribution Date,less the portion of such Principal Distribution Amount distributed pursuant to all prior clauses, and to the Class PEZ Certificates, in reduction of their Certificate Principal Amount, up to an amount equal to the Class B-PEZ Percentage Interest multiplied by the Principal Distribution Amount for such Distribution Date,less the portion of such Principal Distribution Amount distributed pursuant to all prior clauses, pro rata in proportion to their respective percentage interests in the Class B Trust Component, until the Certificate Principal Amount of the Class B Trust Component is reduced to zero;
Ninth, to the Class B Trust Component and, thus, concurrently, to the Class B Certificates, up to an amount equal to the Class B Percentage Interest multiplied by the aggregate of unreimbursed Realized Losses previously allocated to reduce the Certificate Principal Amount of the Class B Trust Component, plus interest on that amount at the Pass-Through Rate for such Trust Component compounded monthly from the date the related Realized Loss was allocated to such Trust Component, and to the Class PEZ Certificates, up to an amount equal to the Class B-PEZ Percentage Interest multiplied by the aggregate of unreimbursed Realized Losses previously allocated to the Class B Trust Component,plus interest on that amount at the Pass-Through Rate for such Trust Component compounded monthly from the date the related Realized Loss was allocated to such Trust Component, pro rata in proportion to their respective percentage interests in the Class B Trust Component;
Tenth, to the Class C Trust Component and, thus, concurrently, to the Class C Certificates, in respect of interest, up to an amount equal to the Class C Percentage Interest multiplied by the aggregate Interest Distribution Amount with respect to the Class C Trust Component, and to the Class PEZ Certificates, in respect of interest, up to an amount equal to the Class C-PEZ Percentage Interest multiplied by the aggregate Interest Distribution Amount with respect to the Class C Trust Component, pro rata in proportion to their respective percentage interests in the Class C Trust Component;
Eleventh, to the Class C Trust Component, and, thus, concurrently, to the Class C Certificates, in reduction of their Certificate Principal Amount, up to an amount equal to the Class C Percentage Interest multiplied by the Principal Distribution Amount for such Distribution Date, less the portion of such Principal Distribution Amount distributed pursuant to all prior clauses, and to the Class PEZ Certificates, in reduction of their Certificate Principal Amount, up to an amount equal to the Class C-PEZ Percentage Interest multiplied by the Principal Distribution Amount for such Distribution Date,less the portion of such Principal Distribution Amount distributed pursuant to all prior clauses, pro rata in proportion to their respective percentage interests in the Class C Trust Component, until the Certificate Principal Amount of the Class C Trust Component is reduced to zero;
Twelfth, to the Class C Trust Component and, thus, concurrently, to the Class C Certificates, up to an amount equal to the Class C Percentage Interest multiplied by the aggregate of unreimbursed Realized Losses previously allocated to reduce the Certificate Principal Amount of the Class C Trust Component, plus interest on that amount at the Pass-Through Rate for such Trust Component compounded monthly from the date the related Realized Loss was allocated to such Trust Component, and to the Class PEZ Certificates, up to an amount equal to the Class C-PEZ Percentage Interest multiplied by the aggregate of unreimbursed Realized Losses previously allocated to the Class C Trust Component,plus interest on that amount at the Pass-Through Rate for such Trust
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Component compounded monthly from the date the related Realized Loss was allocated to such Trust Component, pro rata in proportion to their respective percentage interests in the Class C Trust Component;
Thirteenth, to the Class D Certificates, in respect of interest, up to an amount equal to the Interest Distribution Amount of such Class;
Fourteenth, to the Class D Certificates, in reduction of their Certificate Principal Amount, up to an amount equal to the Principal Distribution Amount for such Distribution Date,less the portion of such Principal Distribution Amount distributed pursuant to all prior clauses, until their Certificate Principal Amount is reduced to zero;
Fifteenth, to the Class D Certificates, up to an amount equal to the aggregate of unreimbursed Realized Losses previously allocated to reduce the Certificate Principal Amount of such Class,plus interest on that amount at the Pass-Through Rate for such Class compounded monthly from the date the related Realized Loss was allocated to such Class;
Sixteenth, to the Class E Certificates, in respect of interest, up to an amount equal to the Interest Distribution Amount of such Class;
Seventeenth, to the Class E Certificates, in reduction of their Certificate Principal Amount, up to an amount equal to the Principal Distribution Amount for such Distribution Date,less the portion of such Principal Distribution Amount distributed pursuant to all prior clauses, until their Certificate Principal Amount is reduced to zero;
Eighteenth, to the Class E Certificates, up to an amount equal to the aggregate of unreimbursed Realized Losses previously allocated to reduce the Certificate Principal Amount of such Class,plus interest on that amount at the Pass-Through Rate for such Class compounded monthly from the date the related Realized Loss was allocated to such Class;
Nineteenth, to the Class F Certificates, in respect of interest, up to an amount equal to the Interest Distribution Amount of such Class;
Twentieth, to the Class F Certificates, in reduction of their Certificate Principal Amount, up to an amount equal to the Principal Distribution Amount for such Distribution Date,less the portion of such Principal Distribution Amount distributed pursuant to all prior clauses, until their Certificate Principal Amount is reduced to zero;
Twenty-first, to the Class F Certificates, up to an amount equal to the aggregate of unreimbursed Realized Losses previously allocated to reduce the Certificate Principal Amount of such Class, plus interest on that amount at the Pass-Through Rate for such Class compounded monthly from the date the related Realized Loss was allocated to such Class;
Twenty-second, to the Class G Certificates, in respect of interest, up to an amount equal to the Interest Distribution Amount of such Class;
Twenty-third, to the Class G Certificates, in reduction of their Certificate Principal Amount, up to an amount equal to the Principal Distribution Amount for such Distribution Date,less the portion of such Principal Distribution Amount distributed pursuant to all prior clauses, until their Certificate Principal Amount is reduced to zero;
Twenty-fourth, to the Class G Certificates, up to an amount equal to the aggregate of unreimbursed Realized Losses previously allocated to reduce the Certificate Principal Amount of such Class,plus interest on that amount at the Pass-Through Rate for such Class compounded monthly from the date the related Realized Loss was allocated to such Class;
Twenty-fifth, to the Class H Certificates, in respect of interest, up to an amount equal to the Interest Distribution Amount of such Class;
Twenty-sixth, to the Class H Certificates, in reduction of their Certificate Principal Amount, up to an amount equal to the Principal Distribution Amount for such Distribution Date,less the portion of such Principal Distribution Amount distributed pursuant to all prior clauses, until their Certificate Principal Amount is reduced to zero;
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Twenty-seventh, to the Class H Certificates, up to an amount equal to the aggregate of unreimbursed Realized Losses previously allocated to reduce the Certificate Principal Amount of such Class,plus interest on that amount at the Pass-Through Rate for such Class compounded monthly from the date the related Realized Loss was allocated to such Class; and
Twenty-eighth, to the Class R Certificates, any remaining amounts.
Notwithstanding the foregoing, on each Distribution Date occurring on and after the date on which the aggregate Certificate Principal Amount of all Sequential Pay Certificates (other than the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates and other than the Exchangeable Certificates) and each Trust Component is (or is expected to be) reduced to zero (that date, the “Cross Over Date”), regardless of the allocation of principal payments described in priority Second above, the Principal Distribution Amount for such Distribution Date is required to be distributed, pro rata (based on their respective outstanding Certificate Principal Amounts), among the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates, in reduction of their respective Certificate Principal Amounts.
Excess Interest
On each Distribution Date, the Certificate Administrator is required to distribute any Excess Interest received with respect to the ARD Loans during the applicable one-month period ending on the related Determination Date to the Class S Certificates.
Prepayment Premiums
On any Distribution Date, prepayment premiums and yield maintenance charges collected prior to the related Determination Date are required to be distributed to the holders of the Classes of Certificates as described below.
On each Distribution Date, each yield maintenance charge collected on the Mortgage Loans and on deposit in the Collection Account as of the related Determination Date is required to be distributed to Certificateholders (excluding holders of the Class X-A, Class E, Class F, Class G, Class H, Class S and Class R Certificates) as follows: (a) first such yield maintenance charge will be allocated between (i) the group (the “YM Group A”) of Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates and the Class A-S Trust Component (and correspondingly the Class A-S and Class PEZ Certificates, pro rata based on their respective percentage interests in the Class A-S Trust Component), and (ii) the group (the “YM Group B” and collectively with the YM Group A, the “YM Groups”) of the Class B Trust Component (and correspondingly the Class B and Class PEZ Certificates, pro rata based on their respective percentage interests in the Class B Trust Component), the Class C Trust Component (and correspondingly the Class C and Class PEZ Certificates, pro rata based on their respective percentage interests in the Class C Trust Component) and the Class D Certificates, pro rata based upon the aggregate amount of principal distributed to the Classes of Regular Certificates and Trust Components (and, therefore, the applicable Classes of Exchangeable Certificates) in each YM Group on such Distribution Date, and (b) then (1) the portion of such yield maintenance charge allocated to each YM Group will be further allocated as among the Classes of Regular Certificates and Trust Components in such YM Group, in the following manner: each Class of Regular Certificates and each Trust Component in such YM Group will entitle the applicable Certificateholders to receive on the applicable Distribution Date that portion of such yield maintenance charge equal to the product of (x) a fraction whose numerator is the amount of principal distributed to such Class or Trust Component on such Distribution Date and whose denominator is the total amount of principal distributed to all of the Regular Certificates and Trust Components in that YM Group on such Distribution Date, (y) the Base Interest Fraction for the related principal prepayment and such Class of Certificates or Trust Component, and (z) the amount of such yield maintenance charge allocated to such YM Group, and (2) the amount of such yield maintenance charge allocated to each YM Group and remaining after such distributions will be distributed to the holders of the Class X-A Certificates. If there is more than one Class of Regular Certificates and/or Trust Component (and, therefore, the applicable Classes of Exchangeable Certificates) in either YM Group entitled to distributions of principal on any particular Distribution Date on which yield maintenance charges are distributable to such Classes and/or Trust Components, the aggregate amount of such yield maintenance charges will be allocated among all such Classes of Regular Certificates and/or Trust Components (and, therefore, the applicable Classes of Exchangeable Certificates) up to, and on a pro rata basis in accordance with, their respective entitlements in those yield maintenance charges in accordance with the first sentence of this paragraph.
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The “Base Interest Fraction” with respect to any principal prepayment on any Mortgage Loan and with respect to any Class of Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class D Certificates or any Trust Component is a fraction (a) whose numerator is the amount, if any, by which (i) the Pass-Through Rate on such Class of Certificates or Trust Component exceeds (ii) the discount rate used in accordance with the related Mortgage Loan documents in calculating the yield maintenance charge with respect to such principal prepayment and (b) whose denominator is the amount, if any, by which (i) the Mortgage Loan Rate on such Mortgage Loan exceeds (ii) the discount rate used in accordance with the related Mortgage Loan documents in calculating the yield maintenance charge with respect to such principal prepayment;provided,however, that under no circumstances will the Base Interest Fraction be greater than one. However, if such discount rate is greater than or equal to both of (x) the Mortgage Loan Rate on such Mortgage Loan and (y) the Pass-Through Rate described in the preceding sentence, then the Base Interest Fraction will equal zero, and if such discount rate is greater than or equal to the Mortgage Loan Rate on such Mortgage Loan, but less than the Pass-Through Rate described in the preceding sentence, then the Base Interest Fraction will equal one.
If a prepayment premium is imposed in connection with a prepayment rather than a yield maintenance charge, then the prepayment premium so collected will be allocated as described above. For this purpose, the discount rate used to calculate the Base Interest Fraction will be the discount rate used to determine the yield maintenance charge for Mortgage Loans that require payment at the greater of a yield maintenance charge or a minimum amount equal to a fixed percentage of the principal balance of the Mortgage Loan or, for Mortgage Loans that only have a prepayment premium based on a fixed percentage of the principal balance of the Mortgage Loan, such other discount rate as may be specified in the related Mortgage Loan documents.
No prepayment premiums or yield maintenance charges will be distributed to holders of the Class E, Class F, Class G, Class H, Class S or Class R Certificates. Instead, after the Notional Amount of the Class X-A Certificates and the Certificate Principal Amounts of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class D Certificates and the Trust Components have been reduced to zero, all prepayment premiums and yield maintenance charges with respect to Mortgage Loans will be distributed to holders of the Class X-A Certificates.
We cannot assure you that any yield maintenance charge or prepayment premium is required or, even if required, would be paid. See “Risk Factors—Some Provisions in the Mortgage Loans Underlying Your Offered Certificates May Be Challenged as Being Unenforceable—Prepayment Premiums, Fees and Charges” and “Certain Legal Aspects of the Mortgage Loans—Default Interest and Limitations on Prepayments” in the prospectus.
Prepayment premiums and yield maintenance charges will be distributed on any Distribution Date only to the extent they are received in respect of the Mortgage Loans as of the related Determination Date.
Allocation Priority of Mortgage Loan Collections
All amounts collected by or on behalf of the Issuing Entity in respect of any Mortgage Loan in the form of payments from the borrowers, Liquidation Proceeds, condemnation proceeds or insurance proceeds are to be allocated to amounts due and owing under the related Mortgage Loan documents in accordance with the express provisions of the related Mortgage Loan documents and any related Co-Lender Agreement (and, in the case of an Outside Serviced Mortgage Loan, the provisions of the Outside Servicing Agreement);provided that, in the absence of such express provisions or if and to the extent that such provisions authorize the mortgagee to use its discretion and in any event after an event of default under the related Mortgage Loan (to the extent not cured or waived), such amounts will be deemed allocated for purposes of collecting amounts due under the Mortgage Loan, in each case only to the extent such amount is an obligation of the related borrower in the related Mortgage Loan documents, pursuant to the Pooling and Servicing Agreement, in the following order of priority:
First, as a recovery of any unreimbursed Advances with respect to the related Mortgage Loan and unpaid interest on all Advances and, if applicable, unreimbursed and unpaid expenses of the Issuing Entity with respect to such Mortgage Loan;
Second, as a recovery of any Non-Recoverable Advances related to such Mortgage Loan and any interest on those Non-Recoverable Advances, to the extent previously reimbursed from principal collections with respect to the other Mortgage Loans;
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Third, to the extent not previously allocated pursuant to clause First, as a recovery of accrued and unpaid interest on such Mortgage Loan (exclusive of default interest and Excess Interest) to the extent of the excess of (i) accrued and unpaid interest on such Mortgage Loan at the related Mortgage Loan Rate to but not including the date of receipt by or on behalf of the Issuing Entity (or, in the case of a full Monthly Payment, through the related Due Date),over (ii) the cumulative amount of the reductions (if any) in the amount of related P&I Advances for such Mortgage Loan that have occurred in connection with related Appraisal Reduction Amounts (to the extent collections have not been allocated as recovery of accrued and unpaid interest on earlier dates pursuant to clause Fifth below);
Fourth, to the extent not previously allocated pursuant to clauseFirst, as a recovery of principal of such Mortgage Loan then due and owing, including by reason of acceleration of such Mortgage Loan following a default thereunder (or, if the Mortgage Loan has been liquidated, as a recovery of principal to the extent of its entire remaining unpaid principal balance);
Fifth, as a recovery of accrued and unpaid interest on such Mortgage Loan to the extent of the cumulative amount of the reductions (if any) in the amount of related P&I Advances for such Mortgage Loan that have occurred in connection with related Appraisal Reduction Amounts (to the extent collections have not been allocated as recovery of accrued and unpaid interest on earlier dates pursuant to this clauseFifth);
Sixth, as a recovery of amounts to be currently allocated to the payment of, or escrowed for the future payment of, real estate taxes, assessments and insurance premiums and similar items relating to such Mortgage Loan;
Seventh, as a recovery of any other reserves to the extent then required to be held in escrow with respect to such Mortgage Loan;
Eighth, as a recovery of any yield maintenance charge or prepayment premium then due and owing under such Mortgage Loan;
Ninth, as a recovery of any default interest and late payment charges then due and owing under such Mortgage Loan;
Tenth, as a recovery of any Assumption Fees, assumption application fees and Modification Fees then due and owing under such Mortgage Loan;
Eleventh, as a recovery of any other amounts then due and owing under such Mortgage Loan other than remaining unpaid principal and, if applicable, unpaid Excess Interest (if both Consent Fees and Operating Advisor Consulting Fees are due and owing, first, allocated to Consent Fees and then, allocated to Operating Advisor Consulting Fees);
Twelfth, as a recovery of any remaining principal of such Mortgage Loan to the extent of its entire remaining unpaid principal balance; and
Thirteenth, in the case of an ARD Loan after the related Anticipated Repayment Date, as a recovery of Excess Interest;
provided that, to the extent required under the REMIC provisions of the Code, payments or proceeds received with respect to any partial release of a Mortgaged Property (including following a condemnation) if, immediately following such release, the loan-to-value ratio of the related Mortgage Loan or the related Serviced Loan Combination exceeds 125% (based solely on the value of the real property and excluding personal property and going concern value, if any), must be allocated to reduce the principal balance of the Mortgage Loan or the related Serviced Loan Combination in the manner permitted by such REMIC provisions.
Collections by or on behalf of the Issuing Entity in respect of any REO Property (exclusive of the amounts to be allocated to the payment of the costs of operating, managing, leasing, maintaining and disposing of such REO Property and, except as otherwise expressly set forth in any related Co-Lender Agreement and, in the case of an Outside Serviced Mortgage Loan, except as otherwise expressly set forth in the Outside Servicing Agreement) will be deemed allocated for purposes of collecting amounts due under the related deemed REO Mortgage Loan,
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in each case only to the extent such amount is or was an obligation of the related borrower in the related Mortgage Loan documents, in the following order of priority:
First, as a recovery of any unreimbursed Advances with respect to the related REO Mortgage Loan and interest on all Advances and, if applicable, unreimbursed and unpaid expenses of the Issuing Entity with respect to the related REO Mortgage Loan;
Second, as a recovery of any Non-Recoverable Advances on the related REO Mortgage Loan or interest on those Non-Recoverable Advances, to the extent previously reimbursed from principal collections with respect to the other Mortgage Loans;
Third, to the extent not previously allocated pursuant to clauseFirst, as a recovery of accrued and unpaid interest on the related REO Mortgage Loan (exclusive of default interest and Excess Interest) to the extent of the excess of (i) accrued and unpaid interest on the related REO Mortgage Loan at the related Mortgage Loan Rate to but not including the Due Date in the Collection Period in which such collections were received, over (ii) the cumulative amount of the reductions (if any) in the amount of related P&I Advances for the related REO Mortgage Loan that have occurred in connection with related Appraisal Reduction Amounts (to the extent collections have not been allocated as recovery of accrued and unpaid interest on earlier dates pursuant to clauseFifth below or clauseFifth of the prior waterfall under this “—Allocation Priority of Mortgage Loan Collections” above);
Fourth, to the extent not previously allocated pursuant to clauseFirst, as a recovery of principal of the related REO Mortgage Loan to the extent of its entire unpaid principal balance;
Fifth, as a recovery of accrued and unpaid interest on the related REO Mortgage Loan to the extent of the cumulative amount of the reductions (if any) in the amount of related P&I Advances for such REO Mortgage Loan that have occurred in connection with related Appraisal Reduction Amounts (to the extent collections have not been allocated as recovery of accrued and unpaid interest on earlier dates pursuant to this clauseFifth or clauseFifth of the prior waterfall under this “—Allocation Priority of Mortgage Loan Collections” above);
Sixth, as a recovery of any yield maintenance charge or prepayment premium then due and owing under the related REO Mortgage Loan;
Seventh, as a recovery of any default interest and late payment charges then due and owing under the related REO Mortgage Loan;
Eighth, as a recovery of any Assumption Fees, assumption application fees and Modification Fees then due and owing under the related REO Mortgage Loan;
Ninth, if the related Mortgage Loan was an ARD Loan, as a recovery of any Excess Interest then due and owing under the related REO Mortgage Loan; and
Tenth, as a recovery of any other amounts then due and owing under the related REO Mortgage Loan (if both Consent Fees and Operating Advisor Consulting Fees are due and owing, first, allocated to Consent Fees and, then, allocated to Operating Advisor Consulting Fees).
Collections and recoveries with respect to any Loan Combination or any related REO Property are generally to be allocated in accordance with the terms and conditions of (i) (A) with respect to an Outside Serviced Loan Combination, the Outside Servicing Agreement, or (B) with respect to a Serviced Loan Combination, the Pooling and Servicing Agreement, (ii) the related Co-Lender Agreement, and/or (iii) the related Mortgage Loan documents, as applicable. See “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
Realized Losses
The Certificate Principal Amount of each Class of Principal Balance Certificates and each Trust Component will be reduced without distribution on any Distribution Date as a write-off to the extent of any Realized Loss allocated to such Class or Trust Component on such Distribution Date. A “Realized Loss” with respect to any Distribution Date is the amount, if any, by which the aggregate Certificate Principal Amount of all Classes of
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Principal Balance Certificates (other than the Exchangeable Certificates) and the Trust Components after giving effect to distributions made on such Distribution Date exceeds the aggregate Stated Principal Balance of the Mortgage Loans (including any REO Mortgage Loans) after giving effect to any and all reductions in such aggregate Stated Principal Balance on such Distribution Date (for purposes of this calculation only, the aggregate Stated Principal Balance will not be reduced by the amount of principal payments received on the Mortgage Loans that were used to reimburse the Master Servicer or the Trustee from general collections of principal on the Mortgage Loans for Workout-Delayed Reimbursement Amounts, to the extent those amounts are not otherwise determined to be Non-Recoverable Advances). On each Distribution Date, any Realized Loss for such Distribution Date will be allocated to the following Classes of Principal Balance Certificates and Trust Components in the following order, until the Certificate Principal Amount of each such Class or Trust Component is reduced to zero: first, to the Class H Certificates; second, to the Class G Certificates; third, to the Class F Certificates; fourth, to the Class E Certificates; fifth, to the Class D Certificates; sixth, to the Class C Trust Component (and correspondingly, to the Class C Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class C Trust Component); seventh, to the Class B Trust Component (and correspondingly, to the Class B Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class B Trust Component); eighth, to the Class A-S Trust Component (and correspondingly, to the Class A-S Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class A-S Trust Component); and, finally, pro rata, to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates, based on their respective Certificate Principal Amounts. The Notional Amount of the Class X-A Certificates will be reduced to reflect reductions in the Certificate Principal Amounts of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates and the Class A-S Trust Component resulting from allocations of Realized Losses. Any amounts recovered in respect of any amounts previously written off as Realized Losses (with interest thereon) as a result of the reimbursement of Non-Recoverable Advances to the Master Servicer or Trustee from amounts otherwise distributable as principal will (1) increase the Principal Distribution Amount for the Distribution Date related to the applicable one-month period in which such recovery occurs and (2) will increase the Certificate Principal Amount of each Class of Principal Balance Certificates (other than the Exchangeable Certificates) and the Trust Components (in sequential order of payment priority starting with the most senior Class or Trust Component) previously subject to a reduction as a result of the allocation of Realized Losses up to an aggregate amount equal to the amount recovered. Such restoration of the Certificate Principal Amount of a Class of Principal Balance Certificates (exclusive of the Exchangeable Certificates) or Trust Component may not exceed, and will reduce on a going-forward basis, any and all unreimbursed Realized Losses previously allocated to such Class of Certificates or Trust Component, as applicable.
Shortfalls in Available Funds resulting from additional servicing compensation other than the Servicing Fee, interest on Advances to the extent not covered by Modification Fees or Penalty Charges on the related Mortgage Loan, extraordinary expenses of the Issuing Entity, items comparable to the foregoing with respect to the Outside Serviced Mortgage Loans, a reduction of the interest rate of a Mortgage Loan in connection with a workout or by a bankruptcy court pursuant to a plan of reorganization or pursuant to any of its equitable powers or other unanticipated or default-related expenses will reduce the amounts distributable on the Classes of Sequential Pay Certificates (other than the Exchangeable Certificates) and the Trust Components in the same order as Realized Losses are applied to reduce the Certificate Principal Amounts of such Classes and Trust Components.
Prepayment Interest Shortfalls
If a borrower prepays a Mortgage Loan or a Serviced Pari Passu Companion Loan, in whole or in part, after the Due Date but on or before the Determination Date in any calendar month, the amount of interest (net of related Servicing Fees, any related Excess Interest and/or default interest) accrued on such prepayment from such Due Date to, but not including, the date of prepayment (or any later date through which interest accrues) will, to the extent actually collected, constitute a “Prepayment Interest Excess”. Conversely, if a borrower prepays a Mortgage Loan or a Serviced Pari Passu Companion Loan, in whole or in part, prior to the Due Date or after the Determination Date in any calendar month and does not pay interest on such prepayment through the end of the applicable interest accrual period for the next Due Date, then the shortfall in a full month’s interest (net of related Servicing Fees, any related Excess Interest and/or default interest) on such prepayment will constitute a “Prepayment Interest Shortfall.” Prepayment Interest Excesses (to the extent not offset by Prepayment Interest Shortfalls) collected on the Mortgage Loans and the Serviced Pari Passu Companion Loan will be retained by the Master Servicer as additional servicing compensation, as determined on a pool-wide aggregate basis. The aggregate of any Prepayment Interest Shortfalls resulting from any principal prepayments made on the Mortgage Loans to be included in the Available Funds for any Distribution Date that are not covered by the Master
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Servicer’s Compensating Interest Payment for the related Distribution Date (the aggregate of the Prepayment Interest Shortfalls that are not so covered, as to the related Distribution Date, the “Excess Prepayment Interest Shortfall”) will be allocated pro rata on that Distribution Date among each Class of Regular Certificates and Trust Component, in accordance with their respective Interest Accrual Amounts for that Distribution Date.
The Master Servicer will be required to deliver to the Certificate Administrator for deposit in the Lower-Tier Distribution Account on each Master Servicer Remittance Date, without any right of reimbursement thereafter, a cash payment (a “Compensating Interest Payment”) in an amount equal to the lesser of (1) the aggregate amount of Prepayment Interest Shortfalls incurred in connection with voluntary principal prepayments received in respect of the Serviced Mortgage Loans and Serviced Pari Passu Companion Loans (other than a Specially Serviced Loan or a Defaulted Mortgage Loan), other than prepayments received in connection with the receipt of insurance proceeds or condemnation proceeds, during the one-month period ending on the Determination Date immediately preceding the related Distribution Date, and (2) the aggregate of (a) its Servicing Fee up to a maximum of 0.0025% per annum for the related Distribution Date with respect to each Serviced Mortgage Loan (and related REO Mortgage Loan) and Serviced Pari PassuCompanion Loan (and related REO Companion Loan) for which such Servicing Fees are being paid during the one-month period ending on the Determination Date immediately preceding the related Distribution Date and (b) all Prepayment Interest Excesses received during the one-month period ending on the Determination Date immediately preceding the related Distribution Date and net investment earnings on such Prepayment Interest Excesses;provided that, solely with respect to a Serviced Mortgage Loan, if any Prepayment Interest Shortfall described in clause (1) above occurs as a result of the Master Servicer’s failure to enforce the related loan documents, the Master Servicer will be required to pay an amount equal to the entire Prepayment Interest Shortfall with respect to that Serviced Mortgage Loan. No Compensating Interest Payment will be made by the Master Servicer or any Outside Servicer (other than to the extent set forth in the applicable Outside Servicing Agreement) with respect to an Outside Serviced Mortgage Loan, Outside Serviced Companion Loan or Subordinate Companion Loan.
Subordination
As a means of providing a certain amount of protection to the holders of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class X-A Certificates against losses associated with delinquent and defaulted Mortgage Loans, the rights of the holders of the Class A-S, Class B, Class PEZ, Class C, Class D, Class E, Class F, Class G and Class H Certificates to receive distributions of interest and principal, as applicable, will be subordinated to such rights of the holders of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class X-A Certificates. The Class A-S Trust Component (and, correspondingly, to the extent evidencing an interest in the Class A-S Trust Component, the Class A-S and Class PEZ Certificates) will likewise be protected by the subordination of the Class B and Class C Trust Components and the Class D, Class E, Class F, Class G and Class H Certificates. The Class B Trust Component (and, correspondingly, to the extent evidencing an interest in the Class B Trust Component, the Class B and Class PEZ Certificates) will likewise be protected by the subordination of the Class C Trust Component and the Class D, Class E, Class F, Class G and Class H Certificates. The Class C Trust Component (and, correspondingly, to the extent evidencing an interest in the Class C Trust Component, the Class C and Class PEZ Certificates) will likewise be protected by the subordination of the Class D, Class E, Class F, Class G and Class H Certificates. The Class D Certificates will likewise be protected by the subordination of the Class E, Class F, Class G and Class H Certificates.
On and after the Cross Over Date has occurred, allocation of principal will be made to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates, pro rata based on Certificate Principal Amount, until their respective Certificate Principal Amounts have been reduced to zero (and the schedule for the Class A-AB principal distributions will be disregarded). Prior to the Cross Over Date, allocation of principal will be made as described under “—Distributions” above. Allocation to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates, for so long as they are outstanding, of the entire Principal Distribution Amount for each Distribution Date will have the effect of reducing the aggregate Certificate Principal Amount of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates at a proportionately faster rate than the rate at which the aggregate Stated Principal Balance of the pool of Mortgage Loans will decline. Therefore, as principal is distributed to the holders of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates, the percentage interest in the Issuing Entity evidenced by the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates will be decreased (with a corresponding increase in the percentage interest in the Issuing Entity evidenced by the Principal Balance Certificates (other than the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates)), thereby increasing, relative to their respective Certificate Principal Amounts, the
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subordination afforded the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates by the other Principal Balance Certificates.
Additionally, on and after the Cross Over Date, losses will be applied to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates, pro rata based on Certificate Principal Amount.
This subordination will be effected in two ways: (i) by the preferential right of the holders of a Class of Certificates and the Trust Components to receive on any Distribution Date the amounts of interest and/or principal distributable on their Certificates prior to any distribution being made on such Distribution Date in respect of any Classes of Certificates or Trust Components subordinate to that Class or Trust Component (as described under “—Distributions—Payment Priorities”) and (ii) by the allocation of Realized Losses: first to the Class H Certificates; second to the Class G Certificates; third, to the Class F Certificates; fourth, to the Class E Certificates; fifth, to the Class D Certificates; sixth, to the Class C Trust Component (and correspondingly, to the Class C Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class C Trust Component); seventh, to the Class B Trust Component (and correspondingly, to the Class B Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class B Trust Component); eighth, to the Class A-S Trust Component (and correspondingly, to the Class A-S Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class A-S Trust Component); and, finally, to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates, pro rata, based on their respective Certificate Principal Amounts. No other form of credit enhancement will be available with respect to any Class of Certificates or Trust Component.
Appraisal Reduction Amounts
After an Appraisal Reduction Event has occurred, an Appraisal Reduction Amount is required to be calculated. An “Appraisal Reduction Event” will occur with respect to a Serviced Loan on the earliest of:
· | the date on which a modification of the Serviced Loan that, among other things, reduces the amount of Monthly Payments on a Serviced Loan, or changes any other material economic term of the Serviced Loan or impairs the security of the Serviced Loan, becomes effective as a result of a modification of the related Serviced Loan following the occurrence of a Servicing Transfer Event; |
· | the date on which the Serviced Loan is 60 days or more delinquent in respect of any scheduled monthly debt service payment (other than a balloon payment); |
· | solely in the case of a delinquent balloon payment, (A) the date occurring 60 days beyond the date on which that balloon payment was due (except as described in clause B below) or (B) if the related borrower has delivered to the Master Servicer or the Special Servicer (and in either such case the Master Servicer or the Special Servicer, as applicable, shall promptly deliver a copy thereof to the other such servicer), a refinancing commitment acceptable to the Special Servicer prior to the date 60 days after maturity, the date occurring 120 days after the date on which that balloon payment was due (or for such shorter period beyond the date on which that balloon payment was due during which the refinancing is scheduled to occur); |
· | the date on which the related Mortgaged Property became an REO Property; |
· | the 60th day after a receiver or similar official is appointed (and continues in that capacity) in respect of the related Mortgaged Property; |
· | the 60th day after the date the related borrower is subject to a bankruptcy, insolvency or similar proceedings (if not dismissed within those 60 days); or |
· | the date on which the Serviced Loan remains outstanding five years following any extension of its maturity date pursuant to the Pooling and Servicing Agreement. |
If an Appraisal Reduction Event occurs with respect to any Serviced Mortgage Loan that is part of a Serviced Loan Combination, then an Appraisal Reduction Event will be deemed to have occurred with respect to the related Serviced Companion Loan(s). If an Appraisal Reduction Event occurs with respect to any Serviced
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Companion Loan that is part of a Serviced Loan Combination, then an Appraisal Reduction Event will be deemed to have occurred with respect to the related Serviced Mortgage Loan and any other Serviced Companion Loan(s) included as part of that Serviced Loan Combination.
No Appraisal Reduction Event may occur at any time when the aggregate Certificate Principal Amount of all Classes of Principal Balance Certificates (other than the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates) has been reduced to zero.
Promptly upon the occurrence of an Appraisal Reduction Event with respect to a Serviced Loan, the Special Servicer is required to use reasonable efforts to obtain an appraisal of the related Mortgaged Property from an Appraiser in accordance with Member of the Appraisal Institute (“MAI”) standards. No new appraisal will be required if an appraisal from an Appraiser in accordance with MAI standards was obtained within the prior nine months unless the Special Servicer determines in accordance with the Servicing Standard that such earlier appraisal is materially inaccurate. The cost of the appraisal will be advanced by the Master Servicer and will be reimbursed to the Master Servicer as a Property Advance.
On the first Determination Date occurring on or after the delivery of the appraisal, the Special Servicer will be required to calculate the Appraisal Reduction Amount, if any, taking into account the results of such appraisal and such information, if any, reasonably requested by the Special Servicer from the Master Servicer reasonably required to calculate or recalculate the Appraisal Reduction Amount. In the event that the Special Servicer has not received any required appraisal within 120 days after the event described in the definition of “Appraisal Reduction Event” (without regard to the time periods set forth in the definition), then, solely for purposes of determining the amounts of the P&I Advances, the amount of the Appraisal Reduction Amount for or allocable to the related Serviced Mortgage Loan will be deemed to be an amount equal to 25% of the current Stated Principal Balance of such related Serviced Mortgage Loan until the appraisal is received. The Master Servicer will provide (via electronic delivery) the Special Servicer with information in its possession that is reasonably required to calculate or recalculate any Appraisal Reduction Amount pursuant to the definition thereof using reasonable efforts to deliver such information within four business days of the Special Servicer’s reasonable written request. None of the Master Servicer, the Trustee or the Certificate Administrator will calculate or verify Appraisal Reduction Amounts.
The “Appraisal Reduction Amount” for any Distribution Date and for any Serviced Mortgage Loan (or Serviced Loan Combination, if applicable) as to which any Appraisal Reduction Event has occurred and the Appraisal Reduction Amount is required to be calculated will be equal to the excess of (a) the Stated Principal Balance of that Serviced Mortgage Loan (or Serviced Loan Combination) as of the last day of the related Collection Periodover (b) the excess of (i) the sum of (A) 90% of the appraised value of the related Mortgaged Property or Mortgaged Properties as determined by the appraisal,minus such downward adjustments as the Special Servicer, in accordance with the Servicing Standard, may make (without implying any obligation to do so) based upon the Special Servicer’s review of the appraisal and such other information as the Special Servicer may deem appropriate and (B) all escrows, letters of credit and reserves in respect of such Serviced Mortgage Loan (or Serviced Loan Combination) as of the date of calculation over (ii) the sum as of the Due Date occurring in the month of the date of determination of (A) to the extent not previously advanced by the Master Servicer or the Trustee, all unpaid interest on that Serviced Mortgage Loan (or Serviced Loan Combination) at a per annum rate equal to the Mortgage Loan Rate (and, with respect to a Serviced Loan Combination, interest on the related Serviced Companion Loan(s) at the related Mortgage Loan Rate), (B) all unreimbursed Advances and interest on those Advances at the Advance Rate in respect of that Serviced Mortgage Loan (or Serviced Loan Combination) and (C) all currently due and unpaid real estate taxes and assessments, insurance premiums and ground rents, unpaid Special Servicing Fees and all other amounts due and unpaid under the Serviced Mortgage Loan (or Serviced Loan Combination) (which tax, premiums, ground rents and other amounts have not been the subject of an Advance by the Master Servicer or Trustee, as applicable, and/or for which funds have not been escrowed). The Master Servicer and the Certificate Administrator will be entitled to conclusively rely on the Special Servicer’s calculation or determination of any Appraisal Reduction Amount. Any Appraisal Reduction Amount with respect to a Serviced Loan Combination will be allocated,first, to any related Serviced Subordinate Companion Loan (up to the outstanding principal balance thereof), andthen, to the related Serviced Mortgage Loan and any related Serviced Pari Passu Companion Loan(s) on a pro rata basis in accordance with the respective outstanding principal balances of the related Serviced Mortgage Loan and Serviced Pari Passu Companion Loan. In the case of an Outside Serviced Loan Combination, pursuant to the Outside Servicing Agreement, certain events will require the calculation of an “appraisal reduction amount”, which will be allocated to the subject Outside Serviced Mortgage Loan and its Outside Serviced Companion Loan(s) on apro rataandpari passu basis in accordance
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with the respective outstanding principal balances of such Outside Serviced Mortgage Loan and its Outside Serviced Companion Loan(s) (with any such allocation to such Outside Serviced Mortgage Loan to constitute an “Appraisal Reduction Amount” for purposes of this prospectus supplement). For the avoidance of doubt, the Outside Special Servicer (and not the Special Servicer) will be required to calculate any “appraisal reduction amount” related to an Outside Serviced Loan Combination.
An “Appraiser” is an independent nationally recognized professional commercial real estate appraiser who (i) is a member in good standing of the Appraisal Institute, (ii) if the state in which the related Mortgaged Property is located certifies or licenses appraisers, is certified or licensed in such state and (iii) has a minimum of five years’ experience in the related property type and market.
As a result of calculating one or more Appraisal Reduction Amounts, the amount of any required P&I Advance will be reduced, which will generally have the effect of reducing the amount of interest available to the most subordinate Class of Regular Certificates or Trust Component then outstanding (i.e., first to the Class H Certificates, then to the Class G Certificates, then to the Class F Certificates, then to the Class E Certificates, then to the Class D Certificates, then to the Class C Trust Component (and correspondingly, to the Class C Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class C Trust Component), then to the Class B Trust Component (and correspondingly, to the Class B Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class B Trust Component), then to the Class A-S Trust Component (and correspondingly, to the Class A-S Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class A-S Trust Component), and then, pro rata based on interest entitlements, to the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class X-A Certificates). See “The Pooling and Servicing Agreement—Advances” in this prospectus supplement.
With respect to each Serviced Loan as to which an Appraisal Reduction Event has occurred (unless the Serviced Loan has become a Corrected Loan (if a Servicing Transfer Event had occurred with respect to the related Serviced Loan) and has remained current for three consecutive Monthly Payments, and no other Appraisal Reduction Event has occurred with respect to the Serviced Loan during the preceding three months), the Special Servicer is required, within 30 days of each annual anniversary of the related Appraisal Reduction Event to order an appraisal (which may be an update of a prior appraisal), the cost of which will be a Property Advance. Based upon the appraisal, the Special Servicer is required to redetermine the amount of the Appraisal Reduction Amount with respect to the Serviced Mortgage Loan (or Serviced Loan Combination).
Any Serviced Loan previously subject to an Appraisal Reduction Amount which ceases to be a Specially Serviced Loan (if applicable), which becomes current and remains current for three consecutive Monthly Payments, and with respect to which no other Appraisal Reduction Event has occurred and is continuing, will no longer be subject to an Appraisal Reduction Amount. An Outside Serviced Mortgage Loan will cease to be subject to an appraisal reduction amount upon the occurrence of certain events specified in the Outside Servicing Agreement.
For purposes of determining the Non-Reduced Certificates and the Controlling Class, as well as the occurrence of a Control Termination Event, Appraisal Reduction Amounts will be allocated to each Class of Regular Certificates (other than the Class X Certificates) and each Trust Component (and correspondingly to the applicable Classes of Exchangeable Certificates) in reverse sequential order to notionally reduce the Certificate Principal Amount thereof until the related Certificate Principal Amount of each such class is reduced to zero (i.e., first to the Class H Certificates, then to the Class G Certificates, then to the Class F Certificates, then to the Class E Certificates, then to the Class D Certificates, then to the Class C Trust Component (and correspondingly, to the Class C Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class C Trust Component), then to the Class B Trust Component (and correspondingly, to the Class B Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class B Trust Component), then to the Class A-S Trust Component (and correspondingly, to the Class A-S Certificates and the Class PEZ Certificates, pro rata based on their respective percentage interests in the Class A-S Trust Component), and then, pro rata based on Certificate Principal Amount, to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates). With respect to any Appraisal Reduction Amount calculated for purposes of determining the Non-Reduced Certificates or the Controlling Class, as well as the occurrence of a Control Termination Event, the appraised value of the related Mortgaged Property will be determined on an “as-is” basis. The Special Servicer will be required to promptly notify the Certificate Administrator of any such Appraisal Reduction Amount, who will be required to promptly post notice of such Appraisal Reduction Amount to the Certificate Administrator’s internet website.
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The holders of Certificates representing the majority of the Certificate Principal Amount of any Class of Control Eligible Certificates whose aggregate Certificate Principal Amount is notionally reduced to less than 25% of the initial Certificate Principal Amount of that Class as a result of an allocation of an Appraisal Reduction Amount in respect of such Class (such Class, an “Appraised-Out Class”) will have the right to challenge the Special Servicer’s Appraisal Reduction Amount determination and, at their sole expense, obtain a second appraisal of any Serviced Loan for which an Appraisal Reduction Event has occurred (such holders, the “Requesting Holders”). The Requesting Holders will be required to cause the appraisal to be prepared on an “as-is” basis by an Appraiser in accordance with MAI standards, and the appraisal must be reasonably acceptable to the Special Servicer in accordance with the Servicing Standard. The Requesting Holders will be required to provide the Special Servicer with notice of their intent to challenge the Special Servicer’s Appraisal Reduction Amount determination within 10 days of the Requesting Holders’ receipt of written notice of the Appraisal Reduction Amount.
An Appraised-Out Class will be entitled to continue to exercise the rights of the Controlling Class until 10 days following its receipt of written notice of the Appraisal Reduction Amount, unless the Requesting Holders provide written notice of their intent to challenge such Appraisal Reduction Amount to the Special Servicer and the Certificate Administrator within such ten-day period as described above. If the Requesting Holders provide this notice, then the Appraised-Out Class will be entitled to continue to exercise the rights of the Controlling Class until the earliest of (i) 120 days following the related Appraisal Reduction Event, unless the Requesting Holders provide the second appraisal within such 120-day period, (ii) the determination by the Special Servicer (described below) that a recalculation of the Appraisal Reduction Amount is not warranted or that such recalculation does not result in the Appraised-Out Class remaining the Controlling Class and (iii) the occurrence of a Consultation Termination Event. After the Appraised-Out Class is no longer entitled to exercise the rights of the Controlling Class, the rights of the Controlling Class will be exercised by the Class of Control Eligible Certificates immediately senior to such Appraised-Out Class, if any, unless a recalculation results in the reinstatement of the Appraised-Out Class as the Controlling Class.
In addition, the holders of Certificates representing the majority of the Certificate Principal Amount of any Appraised-Out Class will have the right, at their sole expense, to require the Special Servicer to order an additional appraisal of any Serviced Loan for which an Appraisal Reduction Event has occurred if an event has occurred at or with regard to the related Mortgaged Property or Mortgaged Properties that would have a material effect on its appraised value, and the Special Servicer is required to use its reasonable best efforts to ensure that such appraisal is delivered within 30 days from receipt of such holders’ written request and is required to ensure that such appraisal is prepared on an “as-is” basis by an Appraiser in accordance with MAI standards;provided that the Special Servicer will not be required to obtain such appraisal if it determines in accordance with the Servicing Standard that no events at or with regard to the related Mortgaged Property or Mortgaged Properties have occurred that would have a material effect on the appraised value of the related Mortgaged Property or Mortgaged Properties.
Upon receipt of an appraisal provided by, or requested by, holders of an Appraised-Out Class as described above and any other information reasonably requested by the Special Servicer from the Master Servicer reasonably required to calculate or recalculate the Appraisal Reduction Amount, the Special Servicer will be required to determine, in accordance with the Servicing Standard, whether, based on its assessment of such additional appraisal, any recalculation of the Appraisal Reduction Amount is warranted and, if so warranted, to recalculate such Appraisal Reduction Amount based upon such additional appraisal. If required by any such recalculation, the Appraised-Out Class will be reinstated as the Controlling Class. The Special Servicer will be required to promptly notify the Certificate Administrator of any such determination and recalculation in its monthly reporting, and the Certificate Administrator will be required to promptly post that reporting to the Certificate Administrator’s website.
Appraisals that are permitted to be presented by, or obtained by the Special Servicer at the request of, holders of an Appraised-Out Class will be in addition to any appraisals that the Special Servicer may otherwise be required to obtain in accordance with the Servicing Standard or the Pooling and Servicing Agreement without regard to any appraisal requests made by any holder of an Appraised-Out Class.
The “Control Eligible Certificates” will be any of the Class F, Class G and Class H Certificates.
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Voting Rights
The Certificates will be allocated voting rights (the “Voting Rights”) for purposes of certain actions that may be taken pursuant to the Pooling and Servicing Agreement. At any time that any Certificates are outstanding, the Voting Rights will be allocated as follows: (a) 0% in the case of the Class S or Class R Certificates; (b) 1% in the case of the Class X-A Certificates; and (c) in the case of any Class of Certificates (other than the Class X-A, Class S and Class R Certificates), a percentage equal to the product of (i) 99% multiplied by (ii) a fraction, the numerator of which is equal to the Certificate Principal Amount of such Class and the denominator of which is equal to the aggregate outstanding Certificate Principal Amounts of all Classes of the Certificates (other than the Class X-A, Class S or Class R Certificates) (or, if with respect to a vote of Non-Reduced Certificates, the Certificate Principal Amounts of all Classes of the Non-Reduced Certificates);provided that for purposes of such allocations, the Class A-S Certificates and the Class PEZ Component A-S of the Class PEZ Certificates will be considered as if they together constitute a single “Class”, the Class B Certificates and the Class PEZ Component B of the Class PEZ Certificates will be considered as if they together constitute a single “Class”, and the Class C Certificates and the Class PEZ Component C of the Class PEZ Certificates will be considered as if they together constitute a single “Class”. Voting Rights will be allocated to the Class PEZ Certificates only with respect to each Class PEZ Component that is part of a “Class” of Certificates determined as described in the proviso to the preceding sentence. The Voting Rights of any Class of Certificates will be allocated among holders of Certificates of such Class in proportion to their respective Percentage Interests. In certain circumstances described under “The Pooling and Servicing Agreement—Termination of the Special Servicer” and “—Operating Advisor—Termination of the Operating Advisor Without Cause”in this prospectus supplement, Voting Rights will only be exercisable by holders of the Non-Reduced Certificates.
“Non-Reduced Certificates” means, as of any date of determination, any Class of Certificates (other than the Class S, Class R and Class X Certificates) then outstanding for which (a) (1) the initial Certificate Principal Amount of such Class of Certificatesminus (2) the sum (without duplication) of (x) any payments of principal (whether as principal prepayments or otherwise) previously distributed to the Certificateholders of such Class of Certificates, (y) any Appraisal Reduction Amounts allocated to such Class of Certificates as of the date of determination and (z) any Realized Losses previously allocated to such Class of Certificates, is equal to or greater than (b) 25% of the remainder of (i) the initial Certificate Principal Amount of such Class of Certificatesless (ii) any payments of principal (whether as principal prepayments or otherwise) previously distributed to the Certificateholders of such Class of Certificates;provided that for purposes of this definition, the Class A-S Certificates and the Class PEZ Component A-S will be considered as if they together constitute a single “Class” of Certificates, the Class B Certificates and the Class PEZ Component B will be considered as if they together constitute a single “Class” of Certificates, the Class C Certificates and the Class PEZ Component C will be considered as if they together constitute a single “Class” of Certificates, and the Class PEZ Certificates will be Non-Reduced Certificates only with respect to each component thereof that is part of a “Class” of Non-Reduced Certificates determined as described in this proviso.
A “Certificateholder” under the Pooling and Servicing Agreement is the person in whose name a Certificate is registered in the certificate register maintained pursuant to the Pooling and Servicing Agreement (including, solely for the purposes of distributing reports, statements or other information pursuant to the Pooling and Servicing Agreement, beneficial owners of Certificates or potential transferees of Certificates to the extent the person distributing such information has been provided with an Investor Certification by or on behalf of such beneficial owner or potential transferee), except that solely for the purpose of giving any consent or taking any action pursuant to the Pooling and Servicing Agreement, any Certificate beneficially owned by the Depositor, the Master Servicer, the Special Servicer, the Trustee, the Certificate Administrator, the Operating Advisor, a manager of a Mortgaged Property, a borrower or any person known to a responsible officer of the Certificate Registrar to be an affiliate of the Depositor, the Master Servicer, the Special Servicer, the Trustee, the Certificate Administrator, the Operating Advisor, a manager of a Mortgaged Property or a borrower will be deemed not to be outstanding and the Voting Rights to which they are entitled will not be taken into account in determining whether the requisite percentage of Voting Rights necessary to effect any such consent or take any such action has been obtained. Notwithstanding the foregoing, for purposes of obtaining the consent of Certificateholders to an amendment of the Pooling and Servicing Agreement, any Certificate beneficially owned by the Depositor, the Master Servicer, the Special Servicer, the Trustee, the Operating Advisor, the Certificate Administrator or any of their affiliates will be deemed to be outstanding;provided that if such amendment relates to the termination, increase in compensation or material reduction of obligations of the Depositor, the Master Servicer, the Special Servicer, the Trustee, the Operating Advisor or the Certificate Administrator or any of their affiliates, then such Certificate so owned will be deemed not to be outstanding. Notwithstanding the foregoing, the restrictions above will not apply (i) to the
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exercise of the rights of the Master Servicer, the Special Servicer or an affiliate of the Master Servicer or the Special Servicer, if any, as a member of the Controlling Class or (ii) to any affiliate of the Depositor, the Master Servicer, the Special Servicer, the Trustee, the Operating Advisor or the Certificate Administrator that has provided an Investor Certification in which it has certified as to the existence of certain policies and procedures restricting the flow of information between it and the Depositor, the Master Servicer, the Special Servicer, the Trustee, the Operating Advisor or the Certificate Administrator, as applicable.
Certain amendments to the Pooling and Servicing Agreement are also subject to the consent of Certificateholders. See “The Pooling and Servicing Agreement—Amendment” in this prospectus supplement.
“Investor Certification” means a certificate substantially in the form(s) attached to the Pooling and Servicing Agreement or in the form(s) of electronic certification(s) contained on the Certificate Administrator’s website representing that such person executing the certificate is a Certificateholder, a Certificate Owner or a prospective purchaser of a Certificate (or any investment advisor or manager of the foregoing), or a Serviced Companion Loan Holder or its representative, and that (i) for purposes of obtaining certain information and notices (including access to information and notices on the Certificate Administrator’s website), (A) such person is not a borrower, a manager of a Mortgaged Property, an affiliate of any of the foregoing or an agent, principal, partner, member, joint venturer, limited partner, employee, representative, director, trustee, advisor or investor in or of any of the foregoing and (B) except in the case of a prospective purchaser of a Certificate or a Serviced Companion Loan Holder or its representative, such person has received a copy of this prospectus supplement and the prospectus and/or (ii) for purposes of exercising Voting Rights (which does not apply to a prospective purchaser of a Certificate or a Serviced Companion Loan Holder or its representative), (A) such person is not a borrower, a manager of a Mortgaged Property, an affiliate of any of the foregoing or an agent of any borrower, (B) such person is or is not the Depositor, the Master Servicer, the Special Servicer, the Trustee, the Operating Advisor, the Certificate Administrator or an affiliate of any of the foregoing and (C) such person has received a copy of this prospectus supplement and the prospectus;provided that if such person is an affiliate of the Depositor, the Master Servicer, the Special Servicer, the Operating Advisor, the Trustee or the Certificate Administrator, such person certifies to the existence or non-existence of appropriate policies and procedures restricting the flow of information between it and the Depositor, the Master Servicer, the Special Servicer, the Operating Advisor, the Trustee or the Certificate Administrator, as applicable.
Delivery, Form, Transfer and Denomination
The Offered Certificates (other than the Class X-A Certificates) will be issued, maintained and transferred in the book-entry form only in minimum denominations of $10,000 initial Certificate Principal Amount, and in multiples of $1 in excess of $10,000. The Class X-A Certificates will be issued, maintained and transferred only in minimum denominations of an authorized initial Notional Amount of not less than $1,000,000 and in integral multiples of $1 in excess of $1,000,000. However, in connection with an exchange of Class A-S, Class B and Class C Certificates for Class PEZ Certificates and vice versa, each of the Class A-S, Class B, and Class C Certificates exchanged (whether surrendered or received in such exchange) will be required to be in denominations of at least $10,000 initial Certificate Principal Amount, and the Class PEZ Certificates exchanged will be required to equal the aggregate Certificate Principal Amount of the Class A-S, Class B and Class C Certificates being exchanged therefor (i.e. in excess of $30,000 initial Certificate Principal Amount).
The Offered Certificates will initially be represented by one or more global Certificates for each such Class registered in the name of a nominee of The Depository Trust Company (“DTC”). The Depositor has been informed by DTC that DTC’s nominee will be Cede & Co. No holder of an Offered Certificate will be entitled to receive a certificate issued in fully registered, certificated form (each, a “Definitive Certificate”) representing its interest in such Class, except under the limited circumstances described under “—Definitive Certificates” below. Unless and until Definitive Certificates are issued, all references to actions by holders of the Offered Certificates will refer to actions taken by DTC upon instructions received from holders of Offered Certificates through its participating organizations (together with Clearstream Banking, société anonyme (“Clearstream”) and Euroclear Bank, as operator of the Euroclear System (“Euroclear”) participating organizations, the “Participants”), and all references in this prospectus supplement to payments, notices, reports, statements and other information to holders of Offered Certificates will refer to payments, notices, reports and statements to DTC or Cede & Co., as the registered holder of the Offered Certificates, for distribution to holders of Offered Certificates through its Participants in accordance with DTC procedures;provided,however, that to the extent that the party to the Pooling and Servicing Agreement responsible for distributing any report, statement or other information has been provided in writing with the name of the Certificate Owner of such an Offered Certificate (or the prospective
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transferee of such Certificate Owner), such report, statement or other information will be provided to such Certificate Owner (or prospective transferee).
Until Definitive Certificates are issued in respect of the Offered Certificates, interests in the Offered Certificates will be transferred on the book-entry records of DTC and its Participants. The Certificate Administrator will initially serve as certificate registrar (in such capacity, the “Certificate Registrar”) for purposes of recording and otherwise providing for the registration of the Offered Certificates.
Book-Entry Registration
Holders of Offered Certificates may hold their Certificates through DTC (in the United States) or Clearstream or Euroclear (in Europe) if they are Participants of such system, or indirectly through organizations that are participants in such systems. Clearstream and Euroclear will hold omnibus positions on behalf of the Clearstream Participants and the Euroclear Participants, respectively, through customers’ securities accounts in Clearstream’s and Euroclear’s names on the books of their respective depositaries (collectively, the “Depositaries”), which in turn will hold such positions in customers’ securities accounts in the Depositaries’ names on the books of DTC. DTC is a limited purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code and a “clearing agency” registered pursuant to Section 17A of the Exchange Act. DTC was created to hold securities for its Participants and to facilitate the clearance and settlement of securities transactions between Participants through electronic computerized book-entries, thereby eliminating the need for physical movement of certificates. Participants (“DTC Participants”) include securities brokers and dealers, banks, trust companies and clearing corporations. Indirect access to the DTC system also is available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a Participant, either directly or indirectly (“Indirect Participants”).
Transfers between DTC Participants will occur in accordance with DTC rules. Transfers between Clearstream Participants (as defined below) and Euroclear Participants (as defined below) will occur in accordance with the applicable rules and operating procedures of Clearstream and Euroclear.
Cross-market transfers between persons holding directly or indirectly through DTC, on the one hand, and directly through Clearstream Participants or Euroclear Participants, on the other, will be effected in DTC in accordance with DTC rules on behalf of the relevant European international clearing system by its Depositary; however, such cross-market transactions will require delivery of instructions to the relevant European international clearing system by the counterparty in such system in accordance with its rules and procedures and within its established deadlines (European time). The relevant European international clearing system will, if the transaction meets its settlement requirements, deliver instructions to its Depositary to take action to effect final settlement on its behalf by delivering or receiving securities in DTC, and making or receiving payment in accordance with normal procedures for same-day funds settlement applicable to DTC. Clearstream Participants and Euroclear Participants may not deliver instructions directly to the Depositaries.
Because of time-zone differences, credits of securities in Clearstream or Euroclear as a result of a transaction with a DTC Participant will be made during the subsequent securities settlement processing, dated the business day following the DTC settlement date, and such credits or any transactions in such securities settled during such processing will be reported to the relevant Clearstream Participant or Euroclear Participant on such business day. Cash received in Clearstream or Euroclear as a result of sales of securities by or through a Clearstream Participant or a Euroclear Participant to a DTC Participant will be received with value on the DTC settlement date but will be available in the relevant Clearstream or Euroclear cash account only as of the business day following settlement in DTC.
The holders of Offered Certificates that are not Participants or Indirect Participants but desire to purchase, sell or otherwise transfer ownership of, or other interests in, such Offered Certificates may do so only through Participants and Indirect Participants. In addition, holders of Offered Certificates in global form (“Certificate Owners”) will receive all distributions of principal and interest through the Participants who in turn will receive them from DTC. Under a book-entry format, holders of such Offered Certificates may experience some delay in their receipt of payments, since such payments will be forwarded by the Certificate Administrator to Cede & Co., as nominee for DTC. DTC will forward such payments to its Participants, which thereafter will forward them to Indirect Participants or the applicable Certificate Owners. Except as otherwise provided under “The Pooling and
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Servicing Agreement—Reports to Certificateholders; Available Information”in this prospectus supplement, Certificate Owners will not be recognized by the Trustee, the Certificate Administrator, the Certificate Registrar, the Operating Advisor, the Special Servicer or the Master Servicer as holders of record of Certificates and Certificate Owners will be permitted to receive information furnished to Certificateholders and to exercise the rights of Certificateholders only indirectly through DTC and its Participants and Indirect Participants.
Under the rules, regulations and procedures creating and affecting DTC and its operations (the “Rules”), DTC is required to make book-entry transfers of Offered Certificates in global form among Participants on whose behalf it acts with respect to such Offered Certificates and to receive and transmit distributions of principal of, and interest on, such Offered Certificates. Participants and Indirect Participants with which the Certificate Owners have accounts with respect to the Offered Certificates similarly are required to make book-entry transfers and receive and transmit such payments on behalf of their respective Certificate Owners. Accordingly, although the Certificate Owners will not possess the Offered Certificates, the Rules provide a mechanism by which Certificate Owners will receive payments on Offered Certificates and will be able to transfer their interest.
Because DTC can only act on behalf of Participants, who in turn act on behalf of Indirect Participants and certain banks, the ability of a holder of Offered Certificates in global form to pledge such Offered Certificates to persons or entities that do not participate in the DTC system, or to otherwise act with respect to such Offered Certificates, may be limited due to the lack of a physical certificate for such Offered Certificates.
DTC has advised the Depositor that it will take any action permitted to be taken by a holder of an Offered Certificate under the Pooling and Servicing Agreement only at the direction of one or more Participants to whose accounts with DTC such Certificate is credited. DTC may take conflicting actions with respect to other undivided interests to the extent that such actions are taken on behalf of Participants whose holdings include such undivided interests.
Clearstream is incorporated under the laws of Luxembourg and is a global securities settlement clearing house. Clearstream holds securities for its participating organizations (“Clearstream Participants”) and facilitates the clearance and settlement of securities transactions between Clearstream Participants through electronic book-entry changes in accounts of Clearstream Participants, thereby eliminating the need for physical movement of certificates. Transactions may be settled in Clearstream in numerous currencies, including United States dollars. Clearstream provides to its Clearstream Participants, among other things, services for safekeeping, administration, clearance and settlement of internationally traded securities and securities lending and borrowing. Clearstream interfaces with domestic markets in several countries. Clearstream is regulated as a bank by the Luxembourg Monetary Institute. Clearstream Participants are recognized financial institutions around the world, including underwriters, securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations and may include the underwriters. Indirect access to Clearstream is also available to others, such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a Clearstream Participant, either directly or indirectly.
Euroclear was created in 1968 to hold securities for participants of the Euroclear system (“Euroclear Participants”) and to clear and settle transactions between Euroclear Participants through simultaneous electronic book-entry delivery against payment, thereby eliminating the need for physical movement of certificates and any risk from lack of simultaneous transfers of securities and cash. Transactions may now be settled in any of numerous currencies, including United States dollars. The Euroclear system includes various other services, including securities lending and borrowing and interfaces with domestic markets in several countries generally similar to the arrangements for cross-market transfers with DTC described above. Euroclear is operated by Euroclear Bank S.A./N.V. (the “Euroclear Operator”). All operations are conducted by the Euroclear Operator, and all Euroclear securities clearance accounts and Euroclear cash accounts are accounts with the Euroclear Operator. Euroclear Participants include banks (including central banks), securities brokers and dealers and other professional financial intermediaries and may include the underwriters. Indirect access to the Euroclear system is also available to other firms that clear through or maintain a custodial relationship with a Euroclear Participant, either directly or indirectly.
Securities clearance accounts and cash accounts with the Euroclear Operator are governed by the Terms and Conditions Governing Use of Euroclear and the related operating procedures of the Euroclear System and applicable Belgian law (collectively, the “Terms and Conditions”). The Terms and Conditions govern transfers of securities and cash within the Euroclear system, withdrawal of securities and cash from the Euroclear system, and receipts of payments with respect to securities in the Euroclear system. All securities in the Euroclear system
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are held on a fungible basis without attribution of specific certificates to specific securities clearance accounts. The Euroclear Operator acts under the Terms and Conditions only on behalf of Euroclear Participants and has no record of or relationship with persons holding through Euroclear Participants.
Although DTC, Euroclear and Clearstream have implemented the foregoing procedures in order to facilitate transfers of interests in book-entry securities among Participants of DTC, Euroclear and Clearstream, they are under no obligation to perform or to continue to comply with such procedures, and such procedures may be discontinued at any time. None of the Depositor, the Trustee, the Certificate Administrator, the Master Servicer, the Special Servicer or the underwriters will have any responsibility for the performance by DTC, Euroclear or Clearstream or their respective direct or indirect Participants of their respective obligations under the rules and procedures governing their operations. The information in this prospectus supplement concerning DTC, Clearstream and Euroclear and their book-entry systems has been obtained from sources believed to be reliable, but neither the Depositor nor the underwriters takes any responsibility for the accuracy or completeness of this information.
Definitive Certificates
Owners of beneficial interests in book-entry Certificates of any Class will not be entitled to receive physical delivery of Definitive Certificates unless: (i) DTC advises the Certificate Registrar in writing that DTC is no longer willing or able to discharge properly its responsibilities as depository with respect to the book-entry Certificates of such Class or ceases to be a clearing agency, and the Certificate Administrator and the Depositor are unable to locate a qualified successor within 90 days of such notice or (ii) the Trustee has instituted or has been directed to institute any judicial proceeding to enforce the rights of the Certificateholders of such Class and the Trustee has been advised by counsel that in connection with such proceeding it is necessary or appropriate for the Trustee to obtain possession of the Certificates of such Class.
Certificateholder Communication
Access to Certificateholders’ Names and Addresses
Upon the written request of (a) any Certificateholder or Certificate Owner that has delivered an executed Investor Certification to the Trustee or the Certificate Administrator (a “Certifying Certificateholder”) or (b) the Master Servicer, the Certificate Registrar will promptly furnish or cause to be furnished to such requesting party a list of the names and addresses of the Certificateholders as of the most recent Record Date as they appear in the certificate register, at the expense of the requesting party.
Special Notices
Upon the written request of any Certifying Certificateholder, the Certificate Administrator will post a special notice prepared by such Certifying Certificateholder to its website and mail such notice to the Certificateholders at their respective addresses appearing on the certificate register stating that the Certifying Certificateholder wishes to be contacted by other holders and beneficial owners of Certificates, setting forth the relevant contact information and briefly stating the reason for the requested contact, at the expense of the Certifying Certificateholder. The Certificate Administrator will be entitled to reimbursement from the Certifying Certificateholder for the reasonable expenses of posting such special notices.
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Yield, Prepayment and Maturity Considerations
Yield
The yield to maturity on the Offered Certificates will depend upon the price paid by the related investors, the rate and timing of the distributions in reduction of the Certificate Principal Amount or Notional Amount of the related Class of Offered Certificates, the extent to which prepayment premiums and yield maintenance charges allocated to the related Class of Offered Certificates are collected, and the rate, timing and severity of losses on the Mortgage Loans and the extent to which such losses are allocable in reduction of the Certificate Principal Amount or Notional Amount of the related Class of Offered Certificates, as well as prevailing interest rates at the time of payment or loss realization.
The rate of distributions in reduction of (or otherwise resulting in the reduction of) the Certificate Principal Amount or Notional Amount of any Class of Offered Certificates, the aggregate amount of distributions on any Class of Offered Certificates and the yield to maturity of any Class of Offered Certificates will be directly related to the rate of payments of principal (both scheduled and unscheduled) on the Mortgage Loans and the amount and timing of borrower defaults and the severity of losses occurring upon a default. While voluntary prepayments of some Mortgage Loans are generally prohibited during applicable prepayment lockout periods, effective prepayments may occur if a sufficiently significant portion of a Mortgaged Property is lost due to casualty or condemnation. See, however, “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—Voluntary Prepayments” in this prospectus supplement, for a discussion of certain Mortgage Loans that do not have a lockout period for prepayment. In addition, such distributions in reduction of Certificate Principal Amounts of the respective Classes of Offered Certificates that are also Principal Balance Certificates (or that otherwise result in the reduction of the Notional Amount of the Class X-A Certificates) may result from repurchases of, or substitutions for, Mortgage Loans made by the Sponsors (or, in the case of RAIT, by RFT or, in the case of KGS, by KGS Holdings) due to missing or defective documentation or breaches of representations and warranties with respect to the Mortgage Loans as described under “Description of the Mortgage Pool—Representations and Warranties” and “—Cures, Repurchases and Substitutions” in this prospectus supplement, purchases of the Mortgage Loans in the manner described under “The Pooling and Servicing Agreement—Optional Termination; Optional Mortgage Loan Purchase” in this prospectus supplement, the exercise of purchase options by the holder of a subordinate companion loan or mezzanine loan, if any. To the extent a Mortgage Loan requires payment of a prepayment premium or yield maintenance charge in connection with a voluntary prepayment, any such prepayment premium or yield maintenance charge generally is not due in connection with a prepayment due to casualty or condemnation, is not included in the purchase price of a Mortgage Loan purchased or repurchased due to a breach of a representation or warranty or otherwise, and may not be enforceable or collectible upon a default.
The Certificate Principal Amount or Notional Amount of any Class of Offered Certificates may be reduced without distributions of principal as a result of the occurrence and allocation of Realized Losses, reducing the maximum amount distributable in respect of principal on the Offered Certificates that are Principal Balance Certificates as well as the amount of interest that would have accrued on the Offered Certificates in the absence of such reduction. In general, a Realized Loss occurs when the principal balance of a Mortgage Loan is reduced without an equal distribution to applicable Certificateholders in reduction of the Certificate Principal Amounts of the Principal Balance Certificates (other than the Exchangeable Certificates) and the Trust Components (and, therefore, the Exchangeable Certificates). Realized Losses may occur in connection with a default on a Mortgage Loan, acceptance of a discounted payoff, the liquidation of the related Mortgaged Properties, a reduction in the principal balance of a Mortgage Loan by a bankruptcy court or pursuant to a modification, a recovery by the Master Servicer or Trustee of a Non-Recoverable Advance on a Distribution Date or the incurrence of certain unanticipated or default-related costs and expenses (including interest on Advances, Workout Fees, Liquidation Fees and Special Servicing Fees and any comparable items with respect to the Outside Serviced Mortgage Loans). Any reduction of the Certificate Principal Amount of a Class of Principal Balance Certificates (exclusive of the Exchangeable Certificates) or a Trust Component (and, therefore, the applicable Classes of Exchangeable Certificates) as a result of the application of Realized Losses may also reduce the Notional Amount of the Class X-A Certificates. Realized Losses will be allocated to the respective Classes of the Principal Balance Certificates (other than the Exchangeable Certificates) and the Trust Components (and, therefore, the Exchangeable Certificates) in reverse distribution priority and as more particularly described in “Description of the Offered Certificates—Subordination” in this prospectus supplement.
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Certificateholders are not entitled to receive distributions of Monthly Payments when due except to the extent they are either covered by an Advance or actually received. Consequently, any defaulted Monthly Payment for which no such Advance is made will tend to extend the weighted average lives of the Offered Certificates, whether or not a permitted extension of the due date of the related Mortgage Loan has been completed.
The rate of payments (including voluntary and involuntary prepayments) on the Mortgage Loans will be influenced by a variety of economic, geographic, social and other factors, including the level of mortgage interest rates and the rate at which borrowers default on their Mortgage Loans. The terms of the Mortgage Loans (in particular, amortization terms, the term of any prepayment lock-out period, the extent to which prepayment premiums or yield maintenance charges are due with respect to any principal prepayments, the right of the mortgagee to apply condemnation and casualty proceeds or reserve funds to prepay the Mortgage Loan, the extent to which a partial principal prepayment is required in connection with the release of a portion of the real estate collateral for a Mortgage Loan, and the availability of certain rights to defease all or a portion of the Mortgage Loan) may affect the rate of principal payments on Mortgage Loans, and consequently, the yield to maturity of the Classes of Offered Certificates. For example, certain Mortgage Loans may permit prepayment of the Mortgage Loan without a lockout period. See “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—Voluntary Prepayments” in this prospectus supplement and Annex A to this prospectus supplement for a description of prepayment lock-out periods, prepayment premiums and yield maintenance charges.
Principal prepayments on the Mortgage Loans could also affect the yield on any Class of Offered Certificates with (or the yield on the Class PEZ Certificates if any Trust Component has) a Pass-Through Rate that is limited by, based upon or equal to the WAC Rate. The Pass-Through Rates on those Classes of Offered Certificates and Trust Components may be adversely affected as a result of a decrease in the WAC Rate even if principal prepayments do not occur.
With respect to the Class A-AB Certificates, the extent to which the Class A-AB Scheduled Principal Balances are achieved and the sensitivity of the Class A-AB Certificates to principal prepayments on the Mortgage Loans will depend in part on the period of time during which the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates remain outstanding. In particular, once such other Classes of Offered Certificates are no longer outstanding, any remaining portion on any Distribution Date of the Principal Distribution Amount will be distributed to the Class A-AB Certificates until the Certificate Principal Amount of the Class A-AB Certificates is reduced to zero. As such, the Class A-AB Certificates will become more sensitive to the rate of prepayments on the Mortgage Loans than they were when the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates were outstanding.
Any changes in the weighted average lives of your Certificates may adversely affect your yield. The timing of changes in the rate of prepayment on the Mortgage Loans may significantly affect the actual yield to maturity experienced by an investor even if the average rate of principal payments experienced over time is consistent with such investor’s expectation. In general, the earlier a prepayment of principal on the Mortgage Loans, the greater the effect on such investor’s yield to maturity. As a result, the effect on such investor’s yield of principal payments occurring at a rate higher (or lower) than the rate anticipated by the investor during the period immediately following the issuance of the Offered Certificates would not be fully offset by a subsequent like reduction (or increase) in the rate of principal payments.
In addition, the rate and timing of delinquencies, defaults, the application of other involuntary payments such as condemnation proceeds or insurance proceeds, losses and other shortfalls on Mortgage Loans will affect distributions on the Offered Certificates and their timing. See “Risk Factors—Your Yield May Be Affected by Defaults, Prepayments and Other Factors” in this prospectus supplement. In general, these factors may be influenced by economic and other factors that cannot be predicted with any certainty. Accordingly, you may find it difficult to predict the effect that these factors might have on the yield to maturity of your Offered Certificates.
In addition, if the Master Servicer or the Trustee is reimbursed out of general collections on the Mortgage Loans included in the Issuing Entity for any advance that it has determined is not recoverable out of collections on the related Mortgage Loan, then to the extent that this reimbursement is made from collections of principal on the Mortgage Loans in the Issuing Entity, that reimbursement will reduce the amount of principal available to be distributed on the Principal Balance Certificates (exclusive of the Exchangeable Certificates) and Trust Components (and, therefore, the Exchangeable Certificates) and will result in a reduction of the Certificate Principal Amount of a Class of Principal Balance Certificates (exclusive of the Exchangeable Certificates) or Trust
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Component (and, therefore, the applicable Classes of Exchangeable Certificates). See “Description of the Offered Certificates—Distributions” in this prospectus supplement. Likewise, if the Master Servicer or the Trustee is reimbursed out of principal collections on the Mortgage Loans for any workout delayed reimbursement amounts, that reimbursement will reduce the amount of principal available to be distributed on the Principal Balance Certificates (exclusive of the Exchangeable Certificates) or Trust Components (and, therefore, the Exchangeable Certificates) on that Distribution Date. This reimbursement would have the effect of reducing current payments of principal on the Offered Certificates that are Principal Balance Certificates and extending the weighted average lives of the respective Classes of those Offered Certificates. See “Description of the Offered Certificates—Distributions” in this prospectus supplement.
If you own Offered Certificates that are Principal Balance Certificates, then prepayments resulting in a shortening of the weighted average lives of your Certificates may be made at a time of low interest rates when you may be unable to reinvest the resulting payments of principal on your Certificates at a rate comparable to the effective yield anticipated by you in making your investment in the Offered Certificates, while delays and extensions resulting in a lengthening of the weighted average lives may occur at a time of high interest rates when you may have been able to reinvest principal payments that would otherwise have been received by you at higher rates.
No representation is made as to the rate of principal payments on the Mortgage Loans or as to the yield to maturity of any Class of Offered Certificates. An investor is urged to make an investment decision with respect to any Class of Offered Certificates based on the anticipated yield to maturity of such Class of Offered Certificates resulting from its purchase price and such investor’s own determination as to anticipated Mortgage Loan prepayment rates under a variety of scenarios. The extent to which any Class of Offered Certificates is purchased at a discount or a premium and the degree to which the timing of payments on such Class of Offered Certificates is sensitive to prepayments will determine the extent to which the yield to maturity of such Class of Offered Certificates may vary from the anticipated yield. An investor should carefully consider the associated risks, including, in the case of any Offered Certificates purchased at a discount, the risk that a slower than anticipated rate of principal payments on the Mortgage Loans could result in an actual yield to such investor that is lower than the anticipated yield and, in the case of any Offered Certificates purchased at a premium, the risk that a faster than anticipated rate of principal payments on the Mortgage Loans could result in an actual yield to such investor that is lower than the anticipated yield.
In general, with respect to any Class of Offered Certificates that is purchased at a premium, if principal distributions occur at a rate faster than anticipated at the time of purchase, the investor’s actual yield to maturity will be lower than that assumed at the time of purchase. Conversely, if a Class of Offered Certificates is purchased at a discount and principal distributions occur at a rate slower than that assumed at the time of purchase, the investor’s actual yield to maturity will be lower than that assumed at the time of purchase.
An investor should consider the risk that rapid rates of prepayments on the Mortgage Loans, and therefore of amounts distributable in reduction of the Certificate Principal Amounts of the Offered Certificates that are Principal Balance Certificates may coincide with periods of low prevailing interest rates. During such periods, the effective interest rates on securities in which an investor may choose to reinvest such amounts distributed to it may be lower than the applicable Pass-Through Rate. Conversely, slower rates of prepayments on the Mortgage Loans, and therefore, of amounts distributable in reduction of the Certificate Principal Amounts of the Offered Certificates that are Principal Balance Certificates may coincide with periods of high prevailing interest rates. During such periods, the amount of principal distributions resulting from prepayments available to an investor in any Offered Certificates that are Principal Balance Certificates for reinvestment at such high prevailing interest rates may be relatively small.
The effective yield to holders of Offered Certificates will be lower than the yield otherwise produced by the applicable Pass-Through Rate and applicable purchase prices because while interest will accrue during each Interest Accrual Period, the distribution of such interest will not be made until the Distribution Date immediately following such Interest Accrual Period, and principal paid on any Distribution Date will not bear interest during the period from the end of such Interest Accrual Period to the Distribution Date that follows.
In addition, although the related borrower under any ARD Loan may have certain incentives to prepay such ARD Loan on its Anticipated Repayment Date, we cannot assure you that such borrower will be able to prepay such ARD Loan on its Anticipated Repayment Date. The failure of the related borrower to prepay an ARD Loan on its Anticipated Repayment Date will not be an event of default under the terms of such ARD Loan, and
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pursuant to the terms of the Pooling and Servicing Agreement, neither the Master Servicer nor the Special Servicer will be permitted to take any enforcement action with respect to such borrower’s failure to pay Excess Interest, other than requests for collection, until the scheduled maturity of such ARD Loan;provided that the Master Servicer or the Special Servicer, as the case may be, may take action to enforce the Issuing Entity’s right to apply excess cash flow to principal in accordance with the terms of the related ARD Loan documents.
Yield on the Class X-A Certificates
The yield to maturity of the Class X-A Certificates will be highly sensitive to the rate and timing of reductions made to the Certificate Principal Amounts of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates and the Class A-S Trust Component, including by reason of prepayments and principal losses on the Mortgage Loans and other factors described above. Investors in the Class X-A Certificates should fully consider the associated risks, including the risk that an extremely rapid rate of prepayment or other liquidation of the Mortgage Loans could result in the failure of such investors to recoup fully their initial investments.
Any optional termination by the holders of the Controlling Class, the Special Servicer, the Master Servicer or the holders of the Class R Certificates would result in prepayment in full of the Certificates and would have an adverse effect on the yield of the Class X-A Certificates because a termination would have an effect similar to a principal prepayment in full of the Mortgage Loans and, as a result, investors in the Class X-A Certificates and any other certificates purchased at premium might not fully recoup their initial investment. See “The Pooling and Servicing Agreement—Optional Termination; Optional Mortgage Loan Purchase” in this prospectus supplement.
Weighted Average Life of the Offered Certificates
Weighted average life refers to the average amount of time from the date of issuance of a security until each dollar of principal of such security will be repaid to the investor (or, in the case of a Class X-A Certificate, each dollar of its Notional Amount is reduced to zero). The weighted average lives of the Offered Certificates will be influenced by the rate at which principal payments (including scheduled payments, principal prepayments and payments made pursuant to any applicable policies of insurance) on the Mortgage Loans are made. Principal payments on the Mortgage Loans may be in the form of scheduled amortization or prepayments (for this purpose, the term prepayment includes prepayments, partial prepayments and liquidations due to a default or other dispositions of the Mortgage Loans).
Calculations reflected in the following tables assume that the Mortgage Loans have the characteristics shown on Annex A (together with the footnotes thereto) to this prospectus supplement, and are based on the following additional assumptions (“Modeling Assumptions”): (i) each Mortgage Loan is assumed to prepay at the indicated level of constant prepayment rate (“CPR”), in accordance with a prepayment scenario in which prepayments occur after expiration of any applicable lock-out period, defeasance and/or yield maintenance options or fixed prepayment premiums, (ii) there are no delinquencies, (iii) scheduled interest and principal payments, including balloon payments, on the Mortgage Loans are timely received on their respective Due Dates, (iv) no prepayment premiums or yield maintenance charges are collected, (v) no party exercises its right of optional termination of the Issuing Entity described in this prospectus supplement, (vi) no Mortgage Loan is required to be repurchased from the Issuing Entity, (vii) the Administrative Fee Rate is the respective rate set forth on Annex A to this prospectus supplement as the “Administrative Fee Rate” with respect to such Mortgage Loan, (viii) there are no Excess Prepayment Interest Shortfalls, other shortfalls unrelated to defaults or Appraisal Reduction Amounts allocated to any class of Certificates, (ix) distributions on the Certificates are made on the tenth day (each assumed to be a business day) of each month, commencing in August 2015, (x) the Certificates will be issued on July 8, 2015, (xi) the Pass-Through Rate with respect to each Class of Offered Certificates (exclusive of the Class PEZ Certificates) and Trust Component is as described under “Description of the Offered Certificates—Distributions—Payment Priorities” in this prospectus supplement, (xii) the ARD Loans (if any) prepay in full on their respective Anticipated Repayment Dates, (xiii) all prepayments are assumed to be voluntary prepayments and will not include, without limitation, Liquidation Proceeds, condemnation proceeds, insurance proceeds, proceeds from the purchase of a Mortgage Loan from the Issuing Entity or any prepayment that is accepted by the Master Servicer or the Special Servicer pursuant to a workout, settlement or loan modification, (xiv) each Class of Exchangeable Certificates is issued at its respective maximum initial Certificate Principal Amount, (xv) the initial Certificate Principal Amounts or Notional Amount of the Certificates and Trust Components (or, in the case of the Exchangeable Certificates, the maximum Certificate Principal Amounts of such Certificates) are as set forth in the table (together with the footnotes thereto) under “Certificate Summary” of this prospectus supplement, and (xvi) no Exchangeable Certificates have been exchanged, except with respect to the decrement table and
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price/yield table below and the expected final distribution date (set forth in the Summary to this prospectus supplement) relating to the Class PEZ Certificates, in which case we assume that the maximum Certificate Principal Amount of the Class PEZ Certificates was issued on the Closing Date.
The weighted average life of any Offered Certificate refers to the average amount of time that will elapse from the date of its issuance until each dollar allocable to principal of such Offered Certificate is distributed to the investor (or, in the case of a Class X-A Certificate, each dollar of its Notional Amount is reduced to zero). The weighted average life of any Offered Certificate will be influenced by, among other things, the rate at which principal on the Mortgage Loans is paid or otherwise collected or advanced and applied to pay principal (or, in the case of a Class X-A Certificate, reduce the Notional Amount) of such Offered Certificate. The Principal Distribution Amount for each Distribution Date will be distributable as described in “Description of the Offered Certificates—Distributions—Payment Priorities” in this prospectus supplement.
The following tables indicate the percentage of the initial Certificate Principal Amount of each Class of Offered Certificates (other than the Class X-A Certificates) that would be outstanding after each of the dates shown under each of the indicated prepayment assumptions and the corresponding weighted average life, first principal payment date and last principal payment date of each such Class of Offered Certificates. The tables have been prepared on the basis of, among others, the Modeling Assumptions. To the extent that the Mortgage Loans or the Certificates have characteristics that differ from those assumed in preparing the tables, the respective Classes of the Offered Certificates that are Principal Balance Certificates may mature earlier or later than indicated by the tables. The Mortgage Loans will not prepay at any constant rate, and it is highly unlikely that the Mortgage Loans will prepay in a manner consistent with the assumptions described in this prospectus supplement. For this reason and because the timing of principal payments is critical to determining weighted average lives, the weighted average lives of the applicable Offered Certificates are likely to differ from those shown in the tables, even if all of the Mortgage Loans prepay at the indicated percentages of CPR or prepayment scenario over any given time period or over the entire life of the Offered Certificates. In addition, variations in the actual prepayment experience and the balance of the Mortgage Loans that prepay may increase or decrease the percentages of initial Certificate Principal Amount (and shorten or extend the weighted average lives) shown in the following tables. Investors are urged to conduct their own analyses of the rates at which the Mortgage Loans may be expected to prepay.
Percentages of the Initial Certificate Principal Amount of
the Class A-1 Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance
or fixed prepayment premiums - otherwise at indicated CPR
Prepayment Assumption (CPR) | |||||||||||||||
Distribution Date | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | ||||||||||
Closing Date | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2016 | 87% | 87% | 87% | 87% | 87% | ||||||||||
Jul 10, 2017 | 71% | 71% | 71% | 71% | 71% | ||||||||||
Jul 10, 2018 | 49% | 49% | 49% | 49% | 49% | ||||||||||
Jul 10, 2019 | 24% | 24% | 24% | 24% | 24% | ||||||||||
Jul 10, 2020 and thereafter | 0% | 0% | 0% | 0% | 0% | ||||||||||
Weighted Average Life (in years) | 2.86 | 2.86 | 2.86 | 2.86 | 2.86 | ||||||||||
First Principal Payment Date | August 2015 | August 2015 | August 2015 | August 2015 | August 2015 | ||||||||||
Last Principal Payment Date | July 2020 | July 2020 | July 2020 | July 2020 | July 2020 |
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Percentages of the Initial Certificate Principal Amount of
the Class A-2 Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance
or fixed prepayment premiums - otherwise at indicated CPR
Prepayment Assumption (CPR) | |||||||||||||||
Distribution Date | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | ||||||||||
Closing Date | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2016 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2017 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2018 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2019 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2020 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2021 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2022 and thereafter | 0% | 0% | 0% | 0% | 0% | ||||||||||
Weighted Average Life (in years) | 6.84 | 6.81 | 6.77 | 6.72 | 6.42 | ||||||||||
First Principal Payment Date | May 2022 | December 2021 | December 2021 | December 2021 | December 2021 | ||||||||||
Last Principal Payment Date | May 2022 | May 2022 | May 2022 | May 2022 | December 2021 |
Percentages of the Initial Certificate Principal Amount of
the Class A-3 Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance or
fixed prepayment premiums - otherwise at indicated CPR
Prepayment Assumption (CPR) | |||||||||||||||
Distribution Date | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | ||||||||||
Closing Date | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2016 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2017 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2018 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2019 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2020 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2021 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2022 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2023 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2024 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2025 and thereafter | 0% | 0% | 0% | 0% | 0% | ||||||||||
Weighted Average Life (in years) | 9.78 | 9.74 | 9.69 | 9.64 | 9.49 | ||||||||||
First Principal Payment Date | February 2025 | November 2024 | November 2024 | November 2024 | December 2021 | ||||||||||
Last Principal Payment Date | May 2025 | May 2025 | April 2025 | April 2025 | January 2025 |
Percentages of the Initial Certificate Principal Amount of
the Class A-4 Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance or
fixed prepayment premiums - otherwise at indicated CPR
Prepayment Assumption (CPR) | |||||||||||||||
Distribution Date | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | ||||||||||
Closing Date | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2016 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2017 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2018 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2019 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2020 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2021 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2022 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2023 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2024 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2025 and thereafter | 0% | 0% | 0% | 0% | 0% | ||||||||||
Weighted Average Life (in years) | 9.86 | 9.86 | 9.85 | 9.82 | 9.59 | ||||||||||
First Principal Payment Date | May 2025 | May 2025 | April 2025 | April 2025 | January 2025 | ||||||||||
Last Principal Payment Date | June 2025 | June 2025 | June 2025 | May 2025 | March 2025 |
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Percentages of the Initial Certificate Principal Amount of
the Class A-AB Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance or
fixed prepayment premiums - otherwise at indicated CPR
Prepayment Assumption (CPR) | |||||||||||||||
Distribution Date | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | ||||||||||
Closing Date | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2016 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2017 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2018 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2019 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2020 | 98% | 98% | 98% | 98% | 98% | ||||||||||
Jul 10, 2021 | 79% | 79% | 79% | 79% | 79% | ||||||||||
Jul 10, 2022 | 58% | 58% | 58% | 58% | 58% | ||||||||||
Jul 10, 2023 | 35% | 35% | 35% | 35% | 35% | ||||||||||
Jul 10, 2024 | 12% | 12% | 12% | 12% | 12% | ||||||||||
Jul 10, 2025 and thereafter | 0% | 0% | 0% | 0% | 0% | ||||||||||
Weighted Average Life (in years) | 7.35 | 7.35 | 7.35 | 7.35 | 7.35 | ||||||||||
First Principal Payment Date | July 2020 | July 2020 | July 2020 | July 2020 | July 2020 | ||||||||||
Last Principal Payment Date | February 2025 | February 2025 | February 2025 | February 2025 | February 2025 |
Percentages of the Initial Certificate Principal Amount of
the Class A-S Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance or
fixed prepayment premiums - otherwise at indicated CPR
Prepayment Assumption (CPR) | |||||||||||||||
Distribution Date | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | ||||||||||
Closing Date | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2016 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2017 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2018 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2019 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2020 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2021 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2022 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2023 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2024 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2025 and thereafter | 0% | 0% | 0% | 0% | 0% | ||||||||||
Weighted Average Life (in years) | 9.92 | 9.92 | 9.92 | 9.91 | 9.67 | ||||||||||
First Principal Payment Date | June 2025 | June 2025 | June 2025 | May 2025 | March 2025 | ||||||||||
Last Principal Payment Date | June 2025 | June 2025 | June 2025 | June 2025 | March 2025 |
Percentages of the Initial Certificate Principal Amount of
the Class B Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance or
fixed prepayment premiums - otherwise at indicated CPR
Prepayment Assumption (CPR) | |||||||||||||||
Distribution Date | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | ||||||||||
Closing Date | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2016 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2017 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2018 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2019 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2020 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2021 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2022 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2023 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2024 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2025 and thereafter | 0% | 0% | 0% | 0% | 0% | ||||||||||
Weighted Average Life (in years) | 9.92 | 9.92 | 9.92 | 9.92 | 9.67 | ||||||||||
First Principal Payment Date | June 2025 | June 2025 | June 2025 | June 2025 | March 2025 | ||||||||||
Last Principal Payment Date | June 2025 | June 2025 | June 2025 | June 2025 | March 2025 |
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Percentages of the Initial Certificate Principal Amount of
the Class PEZ Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance or
fixed prepayment premiums - otherwise at indicated CPR
Prepayment Assumption (CPR) | |||||||||||||||
Distribution Date | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | ||||||||||
Closing Date | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2016 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2017 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2018 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2019 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2020 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2021 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2022 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2023 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2024 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2025 and thereafter | 0% | 0% | 0% | 0% | 0% | ||||||||||
Weighted Average Life (in years) | 9.92 | 9.92 | 9.92 | 9.92 | 9.67 | ||||||||||
First Principal Payment Date | June 2025 | June 2025 | June 2025 | May 2025 | March 2025 | ||||||||||
Last Principal Payment Date | June 2025 | June 2025 | June 2025 | June 2025 | March 2025 |
Percentages of the Initial Certificate Principal Amount of
the Class C Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance or
fixed prepayment premiums - otherwise at indicated CPR
Prepayment Assumption (CPR) | |||||||||||||||
Distribution Date | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | ||||||||||
Closing Date | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2016 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2017 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2018 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2019 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2020 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2021 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2022 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2023 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2024 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2025 and thereafter | 0% | 0% | 0% | 0% | 0% | ||||||||||
Weighted Average Life (in years) | 9.92 | 9.92 | 9.92 | 9.92 | 9.67 | ||||||||||
First Principal Payment Date | June 2025 | June 2025 | June 2025 | June 2025 | March 2025 | ||||||||||
Last Principal Payment Date | June 2025 | June 2025 | June 2025 | June 2025 | March 2025 |
Percentages of the Initial Certificate Principal Amount of
the Class D Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance or
fixed prepayment premiums - otherwise at indicated CPR
Prepayment Assumption (CPR) | |||||||||||||||
Distribution Date | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | ||||||||||
Closing Date | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2016 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2017 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2018 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2019 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2020 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2021 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2022 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2023 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2024 | 100% | 100% | 100% | 100% | 100% | ||||||||||
Jul 10, 2025 and thereafter | 0% | 0% | 0% | 0% | 0% | ||||||||||
Weighted Average Life (in years) | 9.92 | 9.92 | 9.92 | 9.92 | 9.68 | ||||||||||
First Principal Payment Date | June 2025 | June 2025 | June 2025 | June 2025 | March 2025 | ||||||||||
Last Principal Payment Date | June 2025 | June 2025 | June 2025 | June 2025 | April 2025 |
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Price/Yield Tables
The tables set forth below show the corporate bond equivalent (“CBE”) yield with respect to each Class of Offered Certificates under the Modeling Assumptions. Purchase prices set forth below for each Class of Offered Certificates are expressed in 32nds and interpreted as a percentage (i.e., 100-12 is 100-12/32%) of the initial Certificate Principal Amount or Notional Amount, as applicable, of such Class of Offered Certificates, before adding accrued interest.
The yields set forth in the following tables were calculated by determining the monthly discount rates which, when applied to the assumed stream of cash flows to be paid on each Class of Offered Certificates, would cause the discounted present value of such assumed stream of cash flows as of the Closing Date to equal the assumed purchase prices,plus accrued interest at the applicable Pass-Through Rate as described in the Modeling Assumptions, from and including July 1, 2015 to but excluding the Closing Date, and converting such monthly rates to semi-annual corporate bond equivalent rates. Such calculation does not take into account variations that may occur in the interest rates at which investors may be able to reinvest funds received by them as reductions of the Certificate Principal Amounts of the respective Classes of Offered Certificates that are Principal Balance Certificates and consequently does not purport to reflect the return on any investment in such Classes of Offered Certificates when such reinvestment rates are considered.
Pre-Tax Yield to Maturity (CBE) for the Class A-1 Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance | ||||||||||
Assumed Price (32nds) | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | |||||
95-00 | 3.504% | 3.504% | 3.504% | 3.504% | 3.504% | |||||
96-00 | 3.118% | 3.118% | 3.118% | 3.118% | 3.118% | |||||
97-00 | 2.737% | 2.737% | 2.737% | 2.737% | 2.737% | |||||
98-00 | 2.362% | 2.362% | 2.362% | 2.362% | 2.362% | |||||
99-00 | 1.992% | 1.992% | 1.992% | 1.992% | 1.992% | |||||
100-00 | 1.628% | 1.628% | 1.628% | 1.628% | 1.628% | |||||
101-00 | 1.269% | 1.269% | 1.269% | 1.269% | 1.269% | |||||
102-00 | 0.914% | 0.914% | 0.914% | 0.914% | 0.914% | |||||
103-00 | 0.565% | 0.565% | 0.565% | 0.565% | 0.565% | |||||
104-00 | 0.220% | 0.220% | 0.220% | 0.220% | 0.220% | |||||
105-00 | -0.120% | -0.120% | -0.120% | -0.120% | -0.120% |
Pre-Tax Yield to Maturity (CBE) for the Class A-2 Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance | ||||||||||
Assumed Price (32nds) | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | |||||
95-00 | 3.937% | 3.941% | 3.945% | 3.951% | 3.986% | |||||
96-00 | 3.764% | 3.767% | 3.770% | 3.775% | 3.803% | |||||
97-00 | 3.593% | 3.595% | 3.597% | 3.601% | 3.621% | |||||
98-00 | 3.424% | 3.425% | 3.426% | 3.429% | 3.442% | |||||
99-00 | 3.256% | 3.257% | 3.258% | 3.259% | 3.265% | |||||
100-00 | 3.091% | 3.091% | 3.091% | 3.091% | 3.090% | |||||
101-00 | 2.928% | 2.927% | 2.926% | 2.925% | 2.918% | |||||
102-00 | 2.766% | 2.765% | 2.763% | 2.761% | 2.747% | |||||
103-00 | 2.607% | 2.605% | 2.602% | 2.599% | 2.578% | |||||
104-00 | 2.449% | 2.446% | 2.443% | 2.438% | 2.410% | |||||
105-00 | 2.292% | 2.289% | 2.285% | 2.279% | 2.245% |
S-277 |
Pre-Tax Yield to Maturity (CBE) for the Class A-3 Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance | ||||||||||
Assumed Price (32nds) | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | |||||
95-00 | 4.143% | 4.145% | 4.148% | 4.151% | 4.159% | |||||
96-00 | 4.014% | 4.015% | 4.018% | 4.020% | 4.026% | |||||
97-00 | 3.886% | 3.887% | 3.889% | 3.891% | 3.895% | |||||
98-00 | 3.760% | 3.761% | 3.762% | 3.763% | 3.766% | |||||
99-00 | 3.635% | 3.635% | 3.636% | 3.636% | 3.638% | |||||
100-00 | 3.512% | 3.512% | 3.512% | 3.512% | 3.512% | |||||
101-00 | 3.390% | 3.390% | 3.389% | 3.388% | 3.387% | |||||
102-00 | 3.270% | 3.269% | 3.268% | 3.267% | 3.263% | |||||
103-00 | 3.151% | 3.149% | 3.148% | 3.146% | 3.141% | |||||
104-00 | 3.033% | 3.031% | 3.029% | 3.027% | 3.021% | |||||
105-00 | 2.917% | 2.914% | 2.912% | 2.909% | 2.901% |
Pre-Tax Yield to Maturity (CBE) for the Class A-4 Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance | ||||||||||
Assumed Price (32nds) | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | |||||
95-00 | 4.415% | 4.416% | 4.416% | 4.418% | 4.430% | |||||
96-00 | 4.285% | 4.286% | 4.286% | 4.287% | 4.297% | |||||
97-00 | 4.157% | 4.157% | 4.157% | 4.158% | 4.165% | |||||
98-00 | 4.030% | 4.030% | 4.030% | 4.030% | 4.035% | |||||
99-00 | 3.904% | 3.904% | 3.904% | 3.904% | 3.907% | |||||
100-00 | 3.780% | 3.780% | 3.780% | 3.780% | 3.780% | |||||
101-00 | 3.657% | 3.657% | 3.657% | 3.657% | 3.654% | |||||
102-00 | 3.536% | 3.536% | 3.536% | 3.535% | 3.530% | |||||
103-00 | 3.416% | 3.416% | 3.416% | 3.415% | 3.408% | |||||
104-00 | 3.298% | 3.298% | 3.297% | 3.296% | 3.287% | |||||
105-00 | 3.181% | 3.181% | 3.180% | 3.179% | 3.167% |
Pre-Tax Yield to Maturity (CBE) for the Class A-AB Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance | ||||||||||
Assumed Price (32nds) | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | |||||
95-00 | 4.250% | 4.250% | 4.250% | 4.250% | 4.250% | |||||
96-00 | 4.084% | 4.084% | 4.084% | 4.084% | 4.084% | |||||
97-00 | 3.921% | 3.921% | 3.921% | 3.921% | 3.921% | |||||
98-00 | 3.759% | 3.759% | 3.759% | 3.759% | 3.759% | |||||
99-00 | 3.600% | 3.600% | 3.600% | 3.600% | 3.600% | |||||
100-00 | 3.442% | 3.442% | 3.442% | 3.442% | 3.442% | |||||
101-00 | 3.286% | 3.286% | 3.286% | 3.286% | 3.286% | |||||
102-00 | 3.132% | 3.132% | 3.132% | 3.132% | 3.133% | |||||
103-00 | 2.980% | 2.980% | 2.980% | 2.980% | 2.980% | |||||
104-00 | 2.830% | 2.830% | 2.830% | 2.830% | 2.830% | |||||
105-00 | 2.681% | 2.681% | 2.681% | 2.681% | 2.681% |
S-278 |
Pre-Tax Yield to Maturity (CBE) for the Class X-A Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance | ||||||||||
Assumed Price (32nds) | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | |||||
2-24 | 10.317% | 10.288% | 10.249% | 10.202% | 9.981% | |||||
2-28 | 9.092% | 9.061% | 9.021% | 8.972% | 8.742% | |||||
3-00 | 7.950% | 7.918% | 7.876% | 7.825% | 7.586% | |||||
3-04 | 6.882% | 6.849% | 6.805% | 6.753% | 6.506% | |||||
3-08 | 5.880% | 5.846% | 5.801% | 5.747% | 5.491% | |||||
3-12 | 4.937% | 4.902% | 4.856% | 4.800% | 4.537% | |||||
3-16 | 4.047% | 4.011% | 3.964% | 3.906% | 3.636% | |||||
3-20 | 3.206% | 3.168% | 3.120% | 3.061% | 2.783% | |||||
3-24 | 2.408% | 2.369% | 2.320% | 2.259% | 1.974% | |||||
3-28 | 1.649% | 1.610% | 1.559% | 1.497% | 1.206% | |||||
4-00 | 0.927% | 0.887% | 0.835% | 0.772% | 0.474% |
Pre-Tax Yield to Maturity (CBE) for the Class A-S Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance | ||||||||||
Assumed Price (32nds) | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | |||||
95-00 | 4.784% | 4.784% | 4.785% | 4.785% | 4.800% | |||||
96-00 | 4.652% | 4.652% | 4.653% | 4.653% | 4.665% | |||||
97-00 | 4.522% | 4.522% | 4.522% | 4.523% | 4.532% | |||||
98-00 | 4.393% | 4.393% | 4.393% | 4.394% | 4.401% | |||||
99-00 | 4.266% | 4.266% | 4.266% | 4.266% | 4.271% | |||||
100-00 | 4.140% | 4.140% | 4.141% | 4.141% | 4.143% | |||||
101-00 | 4.016% | 4.016% | 4.016% | 4.016% | 4.016% | |||||
102-00 | 3.893% | 3.893% | 3.894% | 3.893% | 3.891% | |||||
103-00 | 3.772% | 3.772% | 3.772% | 3.772% | 3.767% | |||||
104-00 | 3.652% | 3.652% | 3.652% | 3.652% | 3.644% | |||||
105-00 | 3.533% | 3.534% | 3.534% | 3.533% | 3.523% |
Pre-Tax Yield to Maturity (CBE) for the Class B Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance | ||||||||||
Assumed Price (32nds) | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | |||||
95-00 | 4.785% | 4.785% | 4.786% | 4.786% | 4.801% | |||||
96-00 | 4.653% | 4.653% | 4.654% | 4.654% | 4.666% | |||||
97-00 | 4.523% | 4.523% | 4.523% | 4.524% | 4.533% | |||||
98-00 | 4.394% | 4.394% | 4.394% | 4.395% | 4.402% | |||||
99-00 | 4.267% | 4.267% | 4.267% | 4.268% | 4.272% | |||||
100-00 | 4.141% | 4.141% | 4.142% | 4.142% | 4.144% | |||||
101-00 | 4.017% | 4.017% | 4.017% | 4.018% | 4.017% | |||||
102-00 | 3.894% | 3.894% | 3.895% | 3.895% | 3.892% | |||||
103-00 | 3.773% | 3.773% | 3.773% | 3.774% | 3.768% | |||||
104-00 | 3.653% | 3.653% | 3.653% | 3.654% | 3.645% | |||||
105-00 | 3.534% | 3.535% | 3.535% | 3.535% | 3.524% |
S-279 |
Pre-Tax Yield to Maturity (CBE) for the Class PEZ Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance | ||||||||||
Assumed Price (32nds) | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | |||||
95-00 | 4.785% | 4.785% | 4.785% | 4.786% | 4.801% | |||||
96-00 | 4.653% | 4.653% | 4.653% | 4.654% | 4.666% | |||||
97-00 | 4.522% | 4.523% | 4.523% | 4.523% | 4.533% | |||||
98-00 | 4.394% | 4.394% | 4.394% | 4.394% | 4.401% | |||||
99-00 | 4.266% | 4.267% | 4.267% | 4.267% | 4.272% | |||||
100-00 | 4.141% | 4.141% | 4.141% | 4.141% | 4.143% | |||||
101-00 | 4.017% | 4.017% | 4.017% | 4.017% | 4.017% | |||||
102-00 | 3.894% | 3.894% | 3.894% | 3.894% | 3.891% | |||||
103-00 | 3.772% | 3.773% | 3.773% | 3.773% | 3.767% | |||||
104-00 | 3.653% | 3.653% | 3.653% | 3.653% | 3.645% | |||||
105-00 | 3.534% | 3.534% | 3.534% | 3.534% | 3.524% |
Pre-Tax Yield to Maturity (CBE) for the Class C Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance | ||||||||||
Assumed Price (32nds) | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | |||||
95-00 | 4.785% | 4.785% | 4.786% | 4.786% | 4.801% | |||||
96-00 | 4.653% | 4.653% | 4.654% | 4.654% | 4.666% | |||||
97-00 | 4.523% | 4.523% | 4.523% | 4.524% | 4.533% | |||||
98-00 | 4.394% | 4.394% | 4.394% | 4.395% | 4.402% | |||||
99-00 | 4.267% | 4.267% | 4.267% | 4.268% | 4.272% | |||||
100-00 | 4.141% | 4.141% | 4.142% | 4.142% | 4.144% | |||||
101-00 | 4.017% | 4.017% | 4.017% | 4.018% | 4.017% | |||||
102-00 | 3.894% | 3.894% | 3.895% | 3.895% | 3.892% | |||||
103-00 | 3.773% | 3.773% | 3.773% | 3.774% | 3.768% | |||||
104-00 | 3.653% | 3.653% | 3.653% | 3.654% | 3.645% | |||||
105-00 | 3.534% | 3.535% | 3.535% | 3.535% | 3.524% |
Pre-Tax Yield to Maturity (CBE) for the Class D Certificates at the Specified CPRs
0% CPR during lockout, defeasance and/or yield maintenance | ||||||||||
Assumed Price (32nds) | 0% CPR | 25% CPR | 50% CPR | 75% CPR | 100% CPR | |||||
80-00 | 6.993% | 6.993% | 6.993% | 6.994% | 7.054% | |||||
81-00 | 6.831% | 6.831% | 6.831% | 6.831% | 6.888% | |||||
82-00 | 6.671% | 6.671% | 6.671% | 6.672% | 6.725% | |||||
83-00 | 6.513% | 6.513% | 6.514% | 6.514% | 6.564% | |||||
84-00 | 6.358% | 6.358% | 6.358% | 6.359% | 6.406% | |||||
85-00 | 6.205% | 6.205% | 6.205% | 6.206% | 6.250% | |||||
86-00 | 6.054% | 6.054% | 6.054% | 6.055% | 6.096% | |||||
87-00 | 5.905% | 5.906% | 5.906% | 5.906% | 5.944% | |||||
88-00 | 5.759% | 5.759% | 5.759% | 5.759% | 5.794% | |||||
89-00 | 5.614% | 5.614% | 5.614% | 5.615% | 5.647% | |||||
90-00 | 5.471% | 5.471% | 5.472% | 5.472% | 5.501% |
We cannot assure you that the Mortgage Loans will prepay at any particular rate. Moreover, the various remaining terms to maturity of the Mortgage Loans could produce slower or faster principal distributions than indicated in the preceding tables at the various percentages of CPR specified, even if the weighted average remaining term to maturity of the Mortgage Loans is as assumed. Investors are urged to make their investment decisions based on their determinations as to anticipated rates of prepayment under a variety of scenarios.
For additional considerations relating to the yield on the Offered Certificates, see “Yield Considerations” in the prospectus.
S-280 |
The Pooling and Servicing Agreement
General
The Certificates will be issued pursuant to that certain Pooling and Servicing Agreement, to be dated as of July 1, 2015 (the “Pooling and Servicing Agreement”), by and among the Depositor, the Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator and the Trustee.
The servicing of the Serviced Mortgage Loans, the Serviced Companion Loans and any related REO Properties will be governed by the Pooling and Servicing Agreement. The following summaries describe the material provisions of the Pooling and Servicing Agreement relating to the servicing and administration of the Serviced Mortgage Loans, the Serviced Companion Loans and any related REO Properties. The summaries do not purport to be complete and are subject to the provisions of the Pooling and Servicing Agreement. Reference is made to the prospectus for additional information regarding the terms of the Pooling and Servicing Agreement relating to the servicing and administration of the Serviced Mortgage Loans, the Serviced Companion Loan and any related REO Properties. The information in this prospectus supplement supplements any information set forth in the prospectus.
Certain Considerations Regarding the Outside Serviced Loan Combinations
Each Outside Serviced Mortgage Loan and Outside Serviced Companion Loan is being serviced and administered in accordance with the related Outside Servicing Agreement and the related Co-Lender Agreement (and all decisions, consents, waivers, approvals and other actions on the part of the holders of such Outside Serviced Mortgage Loan and Outside Serviced Companion Loan(s) will be effected in accordance with the related Outside Servicing Agreement and the related Co-Lender Agreement). Consequently, the servicing provisions set forth in this prospectus supplement and the administration of certain accounts related to the servicing of the Mortgage Loans will generally not be applicable to the Outside Serviced Mortgage Loans, but instead such servicing and administration of each Outside Serviced Mortgage Loan will be governed by the related Outside Servicing Agreement.
The Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator and the Trustee have no obligation or authority to supervise any Outside Servicer, any Outside Special Servicer and/or any Outside Trustee under any Outside Servicing Agreement or to make property protection advances with respect to any Outside Serviced Loan Combination or P&I advances with respect to any Outside Serviced Companion Loans or any Serviced Companion Loan. Any obligations of the Master Servicer and the Special Servicer to provide information or remit collections on an Outside Serviced Mortgage Loan are dependent on their receipt of the same from the applicable party under the related Outside Servicing Agreement. Each Outside Servicing Agreement provides for servicing in a manner acceptable for rated transactions similar in nature to this securitization transaction. For more detailed information, see “Description of the Mortgage Pool—The Loan Combinations” and “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
As used in this prospectus supplement, references to the Mortgage Loans, when discussing servicing activities with respect to the Mortgage Loans, do not include, unless otherwise specifically indicated, the Outside Serviced Mortgage Loans. In certain instances references are made that specifically exclude the Outside Serviced Mortgage Loans from the servicing provisions in this prospectus supplement by indicating actions are taken with respect to the “Serviced Mortgage Loans” or the “Mortgage Loans other than the Outside Serviced Mortgage Loans” or are taken “except with respect to the Outside Serviced Mortgage Loans” or words of similar import. These references and carveouts are intended to highlight particular provisions to draw prospective investors’ attention to the fact that the Master Servicer, Special Servicer, Certificate Administrator or Trustee are not responsible for the particular servicing or administrative activity with respect to the Outside Serviced Mortgage Loans and are not intended to imply that when other servicing actions are described in this prospectus supplement without such specific reference or carveouts, that the Master Servicer, Special Servicer, Certificate Administrator or Trustee are responsible for those duties with respect to the Outside Serviced Mortgage Loan. Servicing of any Outside Serviced Mortgage Loan is handled under the Outside Servicing Agreement. Prospective investors are encouraged to review “Description of the Mortgage Pool—The Loan Combinations” and “The Pooling and Servicing Agreement—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement for a discussion of certain important servicing terms related to the Outside Serviced Mortgage Loans.
S-281 |
Assignment of the Mortgage Loans
On the Closing Date, the Depositor will sell, transfer or otherwise convey, assign or cause the assignment of the Mortgage Loans, together with all payments due on or with respect to the Mortgage Loans, other than principal and interest due on or before the Cut-off Date and principal prepayments received on or before the Cut-off Date, without recourse, to the Trustee for the benefit of the holders of Certificates.
The Certificate Administrator, concurrently with the assignment, will execute and deliver Certificates evidencing the beneficial ownership interests in the related Issuing Entity to or at the direction of the Depositor in exchange for the Mortgage Loans. Each Mortgage Loan will be identified in a schedule appearing as an exhibit to the Pooling and Servicing Agreement (the “Mortgage Loan Schedule”). The Mortgage Loan Schedule will include, among other things, as to each Mortgage Loan, information as to its outstanding principal balance as of the close of business on the Cut-off Date, as well as information respecting the interest rate and the maturity date of each Mortgage Loan.
In addition, the Depositor will require each Sponsor to deliver to the Trustee, in its capacity as custodian, the Mortgage File for each of the Mortgage Loans. See “Description of the Mortgage Pool—Sale of Mortgage Loans; Mortgage File Delivery” in this prospectus supplement.
The Trustee (in its capacity as custodian), or any other custodian appointed under the Pooling and Servicing Agreement, will hold the Mortgage File for each Mortgage Loan in trust for the benefit of all Certificateholders and the holders of any related Serviced Companion Loans. Pursuant to the Pooling and Servicing Agreement, the Trustee, in its capacity as custodian, is obligated to review the Mortgage File for each Mortgage Loan within a specified number of days after the execution and delivery of the Pooling and Servicing Agreement. If the Special Servicer determines that a Material Document Defect exists, the Special Servicer will promptly notify, among others, the Depositor, the applicable Sponsor, the Certificate Administrator, the Trustee and the Master Servicer. If the applicable Sponsor cannot cure the Material Document Defect within the time period specified in the Pooling and Servicing Agreement, the applicable Sponsor will be obligated either to replace the affected Mortgage Loan with a substitute Mortgage Loan or Mortgage Loans, or to repurchase the related Mortgage Loan from the Trustee within the time period specified in the Pooling and Servicing Agreement at the Repurchase Price. In the case of RAIT, the parent of RAIT, RFT, is guaranteeing the repurchase and substitution obligations of RAIT under the related Mortgage Loan Purchase Agreement in the event that RAIT fails to perform its obligations to cure, effect a repurchase or substitute a Qualified Substitute Mortgage Loan and pay any substitution shortfall amount in response to a Material Document Defect or Material Breach. In the case of KGS, the parent of KGS, KGS Holdings, is guaranteeing the repurchase and substitution obligations of KGS under the related Mortgage Loan Purchase Agreement in the event that KGS fails to perform its obligations to cure, effect a repurchase or substitute a Qualified Substitute Mortgage Loan and pay any substitution shortfall amount in response to a Material Document Defect or Material Breach. This substitution or purchase obligation (and such guaranty obligations) will constitute the sole remedy available to the Certificateholders or the Trustee for a Material Document Defect. See “Description of the Mortgage Pool—Cures, Repurchases and Substitutions” in this prospectus supplement.
Servicing of the Mortgage Loans
Each of the Master Servicer (directly or through one or more sub-servicers) and the Special Servicer will be required to service and administer the Serviced Loans (as described below). The Master Servicer may delegate and/or assign some or all of its servicing obligations and duties with respect to some or all of the Serviced Loans to one or more third-party sub-servicers, with the consent of the Depositor. The Master Servicer will be responsible for paying the servicing fees of any such sub-servicer. Notwithstanding any sub-servicing agreement, the Master Servicer will remain primarily liable to the Trustee, the Certificate Administrator and the Certificateholders and any Serviced Companion Loan Holder for the servicing and administering of the Serviced Loans in accordance with the provisions of the Pooling and Servicing Agreement without diminution of such obligation or liability by virtue of such sub-servicing agreement. The Special Servicer will not be permitted to appoint sub-servicers with respect to any of its servicing obligations and duties.
S-282 |
The Master Servicer and the Special Servicer, as the case may be, will each be required to service and administer the Serviced Loans and each related REO Property for which it is responsible in accordance with applicable law, the terms of the Pooling and Servicing Agreement and the terms of the respective Serviced Loans and, if applicable, the related Co-Lender Agreement and, to the extent consistent with the foregoing, in accordance with the following (the “Servicing Standard”):
· | the higher of the following standards of care: |
1. with the same care, skill, prudence and diligence with which the Master Servicer or the Special Servicer, as the case may be, services and administers comparable mortgage loans with similar borrowers and comparable REO properties for other third-party portfolios, giving due consideration to the customary and usual standards of practice of prudent institutional commercial mortgage lenders servicing their own mortgage loans and REO properties; and
2. with the same care, skill, prudence and diligence with which the Master Servicer or the Special Servicer, as the case may be, services and administers comparable mortgage loans and REO properties owned by the Master Servicer or the Special Servicer, as the case may be; and
in either case, exercising reasonable business judgment and acting in accordance with applicable law, the terms of the Pooling and Servicing Agreement and the terms of the respective subject Serviced Loans;
· | with a view to— |
1. the timely recovery of all payments of principal and interest, including balloon payments, under those Serviced Loans; or
2. in the case of (a) a Specially Serviced Loan or (b) a Mortgage Loan (or Serviced Loan Combination) as to which the related Mortgaged Property is an REO Property, the maximization of recovery on that Mortgage Loan (or Serviced Loan Combination) to the Certificateholders (as if they were one lender) (or, if a Serviced Loan Combination is involved, with a view to the maximization of recovery on such Serviced Loan Combination to the Certificateholders and the related Serviced Companion Loan Holder(s) as if they were one lender (and, with respect to any Serviced AB Loan Combination, taking into account the subordinate nature of the related Subordinate Companion Loan)) of principal and interest, including balloon payments, on a present value basis; and
· | without regard to— |
1. any relationship, including as lender on any other debt, that the Master Servicer or the Special Servicer, as the case may be, or any of its affiliates may have with any of the underlying borrowers, or any affiliate of the underlying borrowers, or any other party to the Pooling and Servicing Agreement;
2. the ownership of any Certificate (or any Companion Loan or other indebtedness secured by the related Mortgaged Property or any security backed by a Companion Loan) by the Master Servicer or the Special Servicer or any affiliate of the Master Servicer or the Special Servicer, as the case may be;
3. the obligation, if any, of the Master Servicer to make Advances;
4. the right of the Master Servicer or the Special Servicer, as the case may be, or any of its affiliates to receive compensation or reimbursement of costs under the Pooling and Servicing Agreement generally or with respect to any particular transaction; and
5. the ownership, servicing or management for others of any mortgage loan or real property not covered by the Pooling and Servicing Agreement by the Master Servicer or the Special Servicer, as the case may be, or any of its affiliates.
S-283 |
The Servicing Standard will apply with respect to the Outside Serviced Mortgage Loans or related REO Property only to the extent that the Master Servicer or the Special Servicer has any express duties or rights to grant consent with respect thereto pursuant to the Pooling and Servicing Agreement.
The Pooling and Servicing Agreement provides, however, that none of the Master Servicer, the Special Servicer, or any of their respective directors, officers, employees or agents will have any liability to the Issuing Entity or the Certificateholders for taking any action or refraining from taking any action in good faith or for errors in judgment. The foregoing provision would not protect the Master Servicer or the Special Servicer for the breach of its representations or warranties in the Pooling and Servicing Agreement or any liability by reason of willful misconduct, bad faith, fraud or negligence in the performance of its duties or by reason of its negligent disregard of its obligations or duties under the Pooling and Servicing Agreement. The Trustee or any other successor Master Servicer assuming the obligations of the Master Servicer under the Pooling and Servicing Agreement will be entitled to the compensation to which the Master Servicer would have been entitled after the date of the assumption of the Master Servicer’s obligations. If no successor Master Servicer can be obtained to perform such obligations for such compensation, additional amounts payable to such successor Master Servicer will be treated as Realized Losses.
In general, the Master Servicer will be responsible for the servicing and administration of each Serviced Mortgage Loan (and Serviced Companion Loan)—
· | which is not a Specially Serviced Loan; or |
· | that is a Corrected Loan. |
A “Specially Serviced Loan” means any Serviced Loan (including a related REO Mortgage Loan or REO Companion Loan) being serviced under the Pooling and Servicing Agreement for which any of the following events (each, a “Servicing Transfer Event”) has occurred as follows:
(a) the related borrower has failed to make when due any scheduled monthly debt service payment or a balloon payment, which failure continues unremedied (without regard to any grace period):
· | except in the case of a Serviced Loan delinquent in respect of its balloon payment, for 60 days beyond the date that payment was due; or |
· | solely in the case of a delinquent balloon payment, (A) 60 days beyond the date on which that balloon payment was due (except as described in clause B below) or (B) in the case of a Serviced Loan delinquent with respect to the balloon payment as to which the related borrower delivered to the Master Servicer or the Special Servicer (and in either such case the Master Servicer or the Special Servicer, as applicable, shall promptly deliver a copy thereof to the other such servicer), a written and fully executed or otherwise binding commitment (subject only to customary closing conditions) for refinancing from an acceptable lender reasonably satisfactory in form and substance to the Master Servicer prior to the date 60 days after maturity, 120 days beyond the date on which that balloon payment was due (or for such shorter period beyond the date on which that balloon payment was due during which the refinancing is scheduled to occur); or |
(b) there has occurred a default (other than as set forth in clause (a) and other than an Acceptable Insurance Default) that the Master Servicer or the Special Servicer (and, in the case of the Special Servicer, with the consent of the related Directing Holder, unless (if the Controlling Class Representative is the related Directing Holder) a Control Termination Event has occurred and is continuing) determines materially impairs the value of the related Mortgaged Property as security for the Serviced Loan or otherwise materially adversely affects the interests of Certificateholders in the Serviced Mortgage Loan (or, in the case of a Serviced Loan Combination, the interests of the Certificateholders and the related Serviced Companion Loan Holder(s) in such Serviced Loan Combination), and continues unremedied for the applicable grace period under the terms of the Serviced Loan (or, if no grace period is specified and the default is capable of being cured, for 30 days);provided that any default that results in acceleration of the related Serviced Loan without the application of any grace period under the related Serviced Loan documents will be deemed not to have a grace period; andprovided,further, that any default requiring a Property Advance will be deemed to materially and adversely affect the interests of the Certificateholders in the subject Serviced Mortgage Loan (or, in the
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case of a Serviced Loan Combination, the interests of the Certificateholders and the related Serviced Companion Loan Holder(s) in such Serviced Loan Combination); or
(c) a decree or order of a court or agency or supervisory authority having jurisdiction in the premises in an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law or the appointment of a conservator or receiver or liquidator in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, has been entered against the related borrower and such decree or order has remained in force and not dismissed for a period of 60 days (or a shorter period if the Master Servicer or the Special Servicer (and, in the case of the Special Servicer, with the consent of the related Directing Holder, unless a Control Termination Event has occurred and is continuing) determines in accordance with the Servicing Standard that the circumstances warrant that the related Serviced Loan (or REO Mortgage Loan or REO Serviced Companion Loan) be transferred to special servicing); or
(d) the related borrower consents to the appointment of a conservator or receiver or liquidator in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to such borrower or of or relating to all or substantially all of its property; or
(e) the related borrower admits in writing its inability to pay its debts generally as they become due, files a petition to take advantage of any applicable insolvency or reorganization statute, makes an assignment for the benefit of its creditors, or voluntarily suspends payment of its obligations; or
(f) the Master Servicer has received notice of the commencement of foreclosure or similar proceedings with respect to the related Mortgaged Property; or
(g) the Master Servicer or the Special Servicer (and, in the case of the Special Servicer, with the consent of the related Directing Holder, unless (if the Controlling Class Representative is the related Directing Holder) a Control Termination Event has occurred and is continuing) determines that (i) a default (other than an Acceptable Insurance Default) under the Serviced Loan is reasonably foreseeable, (ii) such default would materially impair the value of the corresponding Mortgaged Property as security for the Serviced Loan or otherwise materially adversely affect the interests of Certificateholders in the Serviced Mortgage Loan (or, in the case of a Serviced Loan Combination, the interests of the Certificateholders or the related Serviced Companion Loan Holder(s) in the Serviced Loan Combination), and (iii) the default is likely to continue unremedied for the applicable cure period under the terms of the Serviced Loan or, if no cure period is specified and the default is capable of being cured, for 30 days (provided that such 30-day grace period does not apply to a default that gives rise to immediate acceleration without application of a grace period under the terms of the Serviced Loan).
It will be considered an “Acceptable Insurance Default” (and neither the Master Servicer nor the Special Servicer will be required to obtain the below described insurance) if the related Mortgage Loan documents specify that the related borrower must maintain all-risk casualty insurance or other insurance that covers damages or losses arising from acts of terrorism and the Special Servicer has determined, in its reasonable judgment in accordance with the Servicing Standard (and, with the consent of the related Directing Holder, unless (if the Controlling Class Representative is the related Directing Holder) a Control Termination Event has occurred and is continuing), that (i) this insurance is not available at commercially reasonable rates and the subject hazards are not commonly insured against by prudent owners of similar real properties located in or near the geographic region in which the Mortgaged Property is located (but only by reference to such insurance that has been obtained by such owners at current market rates), or (ii) this insurance is not available at any rate;provided,however, that the related Directing Holder will not have more than 30 days to respond to the Special Servicer’s request for such consent;provided,further, that upon the Special Servicer’s determination, consistent with the Servicing Standard, that exigent circumstances do not allow the Special Servicer to consult with the related Directing Holder, the Special Servicer will not be required to do so. In making this determination, the Special Servicer, to the extent consistent with the Servicing Standard, is entitled to rely on the opinion of an insurance consultant.
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A Serviced Loan will cease to be a Specially Serviced Loan and will become a “Corrected Loan” when:
· | with respect to the circumstances described in clause (a) of the definition of Specially Serviced Loan, the related borrower has made three consecutive full and timely scheduled monthly debt service payments under the terms of the Serviced Loan (as such terms may be changed or modified in connection with a bankruptcy or similar proceeding involving the related borrower or by reason of a modification, extension, waiver or amendment granted or agreed to by the Master Servicer or the Special Servicer pursuant to the Pooling and Servicing Agreement); |
· | with respect to the circumstances described in clauses (c), (d), (e) and (g) of the definition of Specially Serviced Loan, the circumstances cease to exist in the good faith, reasonable judgment of the Special Servicer, but, with respect to any bankruptcy or insolvency proceedings described in clauses (c), (d) and (e), no later than the entry of an order or decree dismissing such proceeding; |
· | with respect to the circumstances described in clause (b) of the definition of Specially Serviced Loan, the default is cured as determined by the Special Servicer in its reasonable, good faith judgment; and |
· | with respect to the circumstances described in clause (f) of the definition of Specially Serviced Loan, the proceedings are terminated; |
provided that at such time no other circumstance described in clauses (a) through (g) of the definition of “Specially Serviced Loan” exists that would cause the Mortgage Loan to be characterized as a “Specially Serviced Loan.”
If a Servicing Transfer Event exists with respect to the Mortgage Loan or any Companion Loan in a Serviced Loan Combination, it will be considered to exist for the entire Serviced Loan Combination.
The Special Servicer, on the other hand, will be responsible for the servicing and administration of each Serviced Loan as to which a Servicing Transfer Event has occurred and which has not yet become a Corrected Loan. The Special Servicer will also be responsible for the administration of each REO Property acquired by the Issuing Entity.
Despite the foregoing, the Pooling and Servicing Agreement will require the Master Servicer to continue to collect information and prepare all reports to the Certificate Administrator required to be collected or prepared with respect to any Specially Serviced Loans (based on, among other things, certain information provided by the Special Servicer), receive payments on Specially Serviced Loans, maintain escrows and all reserve accounts on Specially Serviced Loans, maintain insurance with respect to the Mortgaged Properties securing the Specially Serviced Loans and, otherwise, to render other incidental services with respect to any such specially serviced assets. In addition, the Special Servicer will perform limited duties and have certain approval rights regarding servicing actions with respect to Serviced Loans that are not Specially Serviced Loans.
Neither the Master Servicer nor the Special Servicer will have responsibility for the performance by the other of its respective obligations and duties under the Pooling and Servicing Agreement.
The Master Servicer will transfer servicing of a Serviced Loan to the Special Servicer when that Serviced Loan becomes a Specially Serviced Loan. The Special Servicer will return the servicing of that Serviced Loan to the Master Servicer when it becomes a Corrected Loan.
The Special Servicer will be obligated to, among other things, oversee the resolution of Serviced Loans that are Specially Serviced Loans and act as disposition manager of REO Properties (other than any interest in a Mortgaged Property acquired through foreclosure or deed-in-lieu of foreclosure with respect to an Outside Serviced Loan Combination). Each Outside Servicing Agreement provides or is expected to provide, as applicable, for certain servicing transfer events. Upon the occurrence of a servicing transfer event with respect to an Outside Serviced Loan Combination under the Outside Servicing Agreement, servicing of both the affected Outside Serviced Mortgage Loan and the related Outside Serviced Companion Loan(s) will be transferred to the Outside Special Servicer.
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All net present value calculations and determinations made under the Pooling and Servicing Agreement with respect to any Serviced Mortgage Loan or related Mortgaged Property or REO Property (including for purposes of the definition of “Servicing Standard” set forth above) will be made by using a discount rate appropriate for the type of cash flows being discounted; namely (i) for principal and interest payments on the Mortgage Loan or proceeds from the sale of a defaulted Mortgage Loan, the highest of (1) the rate determined by the Master Servicer or the Special Servicer, as applicable, that approximates the market rate that would be obtainable by the borrowers on similar debt of the borrowers as of such date of determination, (2) the Mortgage Loan Rate and (3) the yield on 10-year U.S. treasuries and (ii) for all other cash flows, including property cash flow, the “discount rate” set forth in the most recent appraisal (or updated appraisal).
Advances
The Master Servicer will be obligated (subject to the limitations described below) to advance, on the business day immediately preceding a Distribution Date (the “Master Servicer Remittance Date”), an amount (each such amount, a “P&I Advance”) equal to the total or any portion of the Monthly Payment (exclusive of the related Servicing Fee) due or deemed due on a Mortgage Loan (including the Outside Serviced Mortgage Loans, but not including any Companion Loan) for the Due Date in the related Collection Period, to the extent not received as of the close of business on the related Determination Date (without regard to any grace period). In the event the Monthly Payment has been reduced pursuant to any modification, waiver or amendment of the terms of the Mortgage Loan, whether agreed to by the Special Servicer or resulting from bankruptcy, insolvency or any similar proceeding involving the related borrower, the amount required to be advanced will be so reduced. The Master Servicer will not be required or permitted to make an advance for balloon payments, default interest, Excess Interest, prepayment premiums or yield maintenance charges or delinquent monthly debt service payments on the Companion Loans. The amount required to be advanced by the Master Servicer with respect to any Distribution Date in respect of delinquent payments of interest on any Mortgage Loan as to which an Appraisal Reduction Amount exists will equal the product of (i) the amount otherwise required to be advanced by the Master Servicer with respect to delinquent payments of interest without giving effect to such Appraisal Reduction Amount, and (ii) a fraction, the numerator of which is the Stated Principal Balance of such Mortgage Loan as of the last day of the related Collection Period, reduced by such Appraisal Reduction Amount, and the denominator of which is the Stated Principal Balance of such Mortgage Loan as of the last day of the related Collection Period. Appraisal Reduction Amounts will not affect advances in respect of delinquent payments of principal.
The Master Servicer will also be obligated (subject to the limitations described below) with respect to each Serviced Loan serviced, and each REO Property administered, under the Pooling and Servicing Agreement, to make cash advances (“Property Advances” and, together with P&I Advances, “Advances”) to pay all customary, reasonable and necessary “out of pocket” costs and expenses (including attorneys’ fees and fees and expenses of real estate brokers) incurred in connection with the servicing and administration of such Serviced Loan if a default is imminent thereunder or a default, delinquency or other unanticipated event has occurred, or in connection with the administration of any such REO Property, including, but not limited to, the cost of the preservation, insurance, restoration, protection and management of a related Mortgaged Property, the cost of delinquent real estate taxes and assessments, ground lease rent payments, condominium assessments, hazard insurance premiums and to cover other similar costs and expenses necessary to preserve the priority of or enforce the related Mortgage or to maintain a related Mortgaged Property, subject to a non-recoverability determination. The Master Servicer has no obligation to make any Property Advances with regard to any Outside Serviced Mortgage Loan.
The Master Servicer will advance the cost of preparation of any environmental assessments required to be obtained in connection with taking title to any REO Property unless the Master Servicer determines, in its good faith judgment, that such Advance would be a Non-Recoverable Advance but the cost of any compliance, containment, clean-up or remediation of an REO Property will be an expense of the Issuing Entity and paid from the Collection Account.
The Pooling and Servicing Agreement will obligate the Trustee to make any P&I Advance that the Master Servicer was obligated, but failed, to make unless the Trustee or the Special Servicer determines such P&I Advance would be a Non-Recoverable Advance.
The Special Servicer is required to request the Master Servicer to make Property Advances with respect to a Specially Serviced Loan or REO Property under the Pooling and Servicing Agreement. The Special Servicer must make the request a specified number of days in advance of when the Property Advance is required to be
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made under the Pooling and Servicing Agreement. The Master Servicer, in turn, must make the requested Property Advance within a specified number of days following the Master Servicer’s receipt of the request unless the Master Servicer determines such Advance would be a Non-Recoverable Advance. The Special Servicer will have no obligation to make any Property Advance.
If the Master Servicer is required under the Pooling and Servicing Agreement to make a Property Advance, but does not do so within 15 days after the Property Advance is required to be made by it, then the Trustee will be required:
· | if a responsible officer of the Trustee has actual knowledge of the failure, to give the Master Servicer notice of its failure; and |
· | if the failure continues for three more business days, to make the Property Advance, unless the Trustee determines such Property Advance would be a Non-Recoverable Advance. |
The Master Servicer and the Trustee, as applicable, will each be entitled to receive interest on Advances at the Prime Rate, compounded annually (the “Advance Rate”), as of each Master Servicer Remittance Date;provided,however, that with respect to any P&I Advance made prior to the expiration of the related grace period, interest on such P&I Advance will accrue only from and after the expiration of such grace period. If the interest on such Advance is not recovered from Modification Fees on the related Mortgage Loan or Penalty Charges on any Mortgage Loan, a shortfall will result which will have the same effect as a liquidation loss on a defaulted Mortgage Loan. The “Prime Rate” is the rate on any day set forth as such inThe Wall Street Journal, Eastern edition.
The obligation of the Master Servicer or the Trustee, as applicable, to make Advances with respect to any Mortgage Loan pursuant to the Pooling and Servicing Agreement continues through the foreclosure of such Mortgage Loan and until the liquidation of such Mortgage Loan or the related Mortgaged Properties. Advances are intended to provide a limited amount of liquidity, not to guarantee or insure against losses.
Each Outside Servicer will (or is expected to) be obligated to make servicing advances with respect to the related Outside Serviced Loan Combination and will (or is expected to) be entitled to reimbursement for such servicing advances with interest at a prime lending rate. In addition, if any such servicing advance is determined to be a nonrecoverable advance under an Outside Servicing Agreement, then the Outside Servicer or the Outside Trustee, as applicable, will (or is expected to) be entitled to reimbursement from general collections on the Mortgage Loans in this securitization transaction for the pro rata portion of such nonrecoverable advances allocable to the related Outside Serviced Mortgage Loan (with interest at a prime lending rate) pursuant to the terms of the related Co-Lender Agreement.
If the Master Servicer or the Special Servicer, in accordance with the Servicing Standard, or the Trustee in its good faith business judgment, as applicable, determines that any Advance (together with accrued interest on the Advance) previously made by it (or, in the case of a determination by the Special Servicer, by the Master Servicer or the Trustee) will not be ultimately recoverable out of related late payments, net insurance proceeds, Net Condemnation Proceeds, net liquidation proceeds or other collections with respect to the Mortgage Loan or REO Property, as the case may be, as to which such Advance was made (any such Advance, a “Non-Recoverable Advance”), then the Master Servicer or the Trustee, as applicable, will be entitled to be reimbursed for such Advance,plus interest on the Advance at the Advance Rate, out of amounts payable on or in respect of all of the Mortgage Loans and REO Properties prior to distributions on the Certificates, which will be deemed to have been reimbursed first out of amounts collected or advanced in respect of principal and then out of all other amounts collected on the Mortgage Loans and REO Properties.
In connection with a determination by the Master Servicer, the Special Servicer or the Trustee as to whether an Advance previously made or to be made constitutes or would constitute a Non-Recoverable Advance:
· | neither the Master Servicer nor the Trustee will be required to make any Advance that the Master Servicer or the Special Servicer, in accordance with the Servicing Standard, or the Trustee in its good faith business judgment, determines will not be ultimately recoverable (including interest accrued on the Advance) by the Master Servicer or the Trustee, as applicable, out of related late payments, net insurance proceeds, Net Condemnation Proceeds, net liquidation proceeds or other collections with |
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respect to the Mortgage Loan or REO Property, as the case may be, as to which such Advance was made; |
· | the Special Servicer may, at its option, make a determination in accordance with the Servicing Standard that any proposed Advance, if made, would be a Non-Recoverable Advance or that any outstanding Advance is a Non-Recoverable Advance and may deliver to the Master Servicer, the Trustee, the Controlling Class Representative (prior to the occurrence and continuance of a Consultation Termination Event) and, in the case of a Property Advance with respect to a Serviced Outside Controlled Loan Combination, the related Outside Controlling Note Holder notice of such determination, which determination will be conclusive and binding on the Master Servicer and the Trustee; |
· | although the Special Servicer may determine whether an outstanding Advance is a Non-Recoverable Advance, the Special Servicer will have no right to (i) make an affirmative determination that any Property Advance previously made, to be made (or contemplated to be made) by the Master Servicer or the Trustee is, or would be, recoverable or (ii) reverse any other authorized person’s determination or to prohibit any such other authorized person from making a determination, that an Advance constitutes or would constitute a Non-Recoverable Advance;provided that this sentence will not be construed to limit the Special Servicer’s right to make a determination that an Advance to be made (or contemplated to be made) would be or a previously made Advance is a Non-Recoverable Advance, as described in the preceding bullet; |
· | any non-recoverability determination by the Master Servicer or the Special Servicer described in this paragraph with respect to the non-recoverability of Advances will be conclusive and binding on the Master Servicer (in the case of such a determination by the Special Servicer) and the Trustee; and |
· | notwithstanding the foregoing, the Trustee may conclusively rely upon any determination by the Master Servicer or the Special Servicer that any Advance would be recoverable (unless a non-recoverability determination has been made by the other servicer in accordance with the preceding bullet which is binding on the Trustee), and the Master Servicer may conclusively rely upon any determination by the Special Servicer that any Advance would be recoverable. |
Any such judgment or determination with respect to the recoverability of Advances by any of the Trustee, the Master Servicer or the Special Servicer must be made (i) in the case of the Master Servicer or the Special Servicer, in accordance with the Servicing Standard, or (ii) in the case of the Trustee, in accordance with its good faith business judgment, and in any event will be required to be evidenced by an officer’s certificate delivered to, among others, the other such parties, the Controlling Class Representative (prior to the occurrence and continuance of a Control Termination Event) and, in the case of a Property Advance with respect to any Serviced Outside Controlled Loan Combination, the related Outside Controlling Note Holder, setting forth such judgment or determination of nonrecoverability and the procedures and considerations of the Master Servicer, the Special Servicer or the Trustee, as applicable, forming the basis of such determination.
With respect to an Outside Serviced Mortgage Loan and the Master Servicer’s and Trustee’s obligation to make P&I Advances, the Master Servicer and the Trustee may make their own independent determination as to the recoverability or the nonrecoverability notwithstanding any determination of the recoverability or the nonrecoverability, as the case may be, by the Outside Servicer or Outside Trustee. In addition, an Outside Servicer under an Outside Servicing Agreement will be entitled to seek recovery from the Issuing Entity of the pro rata share of any non-recoverable servicing advance made with respect to such Outside Serviced Loan Combination, with interest at a prime lending rate.
The Master Servicer or the Trustee, as applicable, will be entitled to reimbursement for any Advance made by it, including all P&I Advances made with respect to the Outside Serviced Mortgage Loans, equal to the amount of such Advance and interest accrued on the Advance at the Advance Rate (i) from Penalty Charges and Modification Fees on the related Mortgage Loan by the borrower and any other collections on the Mortgage Loan, (ii) from insurance proceeds, condemnation proceeds or Liquidation Proceeds collected on the defaulted Mortgage Loan or the related Mortgaged Property or (iii) upon determining in good faith that such Advance with interest is not recoverable from amounts described in clauses (i) and (ii), from any other amounts from time to time on deposit in the Collection Account.
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Notwithstanding anything in this prospectus supplement to the contrary, the Master Servicer may in accordance with the Servicing Standard elect (but is not required) to make a payment (and in the case of a Specially Serviced Loan, at the direction of the Special Servicer will be required to make a payment) from amounts on deposit in the Collection Account that would otherwise be a Property Advance with respect to a Mortgage Loan notwithstanding that the Master Servicer or the Special Servicer has determined that such a Property Advance would, if made, be a Non-Recoverable Advance, if making the payment would (x) prevent (i) the related Mortgaged Property from being uninsured or being sold at a tax sale or (ii) any event that would cause a loss of the priority of the lien of the related Mortgage, or the loss of any security for the related Mortgage Loan, or (y) would remediate any adverse environmental condition or circumstance at any of the Mortgaged Properties, if, in each instance, the Special Servicer or the Master Servicer, as applicable, determines in accordance with the Servicing Standard that making the payment is in the best interest of the Certificateholders (and, with respect to any Serviced Loan Combination, the related Serviced Companion Loan Holder) (as a collective whole as if such Certificateholders and/or the related Serviced Companion Loan Holder constituted a single lender) (and, with respect to a Serviced AB Loan Combination, taking into account the subordinate nature of the related Subordinate Companion Loan).
Notwithstanding the foregoing, if the funds in the Collection Account allocable to principal and available for distribution on the next Distribution Date are insufficient to fully reimburse the Master Servicer or the Trustee, as applicable, for a Non-Recoverable Advance, then such party may elect, on a monthly basis, in its sole discretion, to defer reimbursement of some or all of the portion that exceeds such amount allocable to principal (in which case interest will continue to accrue on the unreimbursed portion of the Advance) for a period not to exceed 12 months in any event;provided that any deferral in excess of six months will be subject to the consent of the Controlling Class Representative (or, in the case of a Property Advance with respect to a Serviced Outside Controlled Loan Combination, the related Outside Controlling Note Holder) (unless, if the Controlling Class Representative is the consenting party, a Control Termination Event has occurred and is continuing, in which case the Controlling Class Representative must be consulted with unless a Consultation Termination Event has occurred and is continuing). In addition, the Master Servicer or the Trustee, as applicable, will be entitled to recover any Advance that is outstanding at the time that a Mortgage Loan is modified but is not repaid in full by the borrower in connection with such modification but becomes an obligation of the borrower to pay such amounts in the future (such Advance, a “Workout-Delayed Reimbursement Amount”) out of principal collections in the Collection Account (net of any amounts used to pay a Non-Recoverable Advance or interest on such Non-Recoverable Advance). The Master Servicer or the Trustee will be permitted to recover a Workout-Delayed Reimbursement Amount from general collections in the Collection Account if the Master Servicer or the Trustee, as applicable, (a) has determined that such Workout-Delayed Reimbursement Amount would not be recoverable out of collections on the related Mortgage Loan or (b) has determined that such Workout-Delayed Reimbursement Amount would not ultimately be recoverable, along with any other Workout-Delayed Reimbursement Amounts and Non-Recoverable Advances, out of the principal portion of future collections on the Mortgage Loans and the REO Properties.
Any requirement of the Master Servicer or the Trustee to make an Advance in the Pooling and Servicing Agreement is intended solely to provide liquidity for the benefit of the Certificateholders and not as credit support or otherwise to impose on any such person the risk of loss with respect to one or more Mortgage Loans.
Any election described above by any party to refrain from reimbursing itself for any Non-Recoverable Advance (together with interest for that Non-Recoverable Advance) or portion of any Non-Recoverable Advance with respect to any Distribution Date will not be construed to impose on any party any obligation to make the above described election (or any entitlement in favor of any Certificateholder or any other person to an election) with respect to any subsequent Collection Period or to constitute a waiver or limitation on the right of the person making the election to otherwise be reimbursed for a Non-Recoverable Advance immediately (together with interest on that Non-Recoverable Advance). An election by the Master Servicer or the Trustee will not be construed to impose any duty on the other party to make an election (or any entitlement in favor of any Certificateholder or any other person to such an election). The fact that a decision to recover a Non-Recoverable Advance over time, or not to do so, benefits some Classes of Certificateholders to the detriment of other Classes of Certificateholders will not constitute a violation of the Servicing Standard or a breach of the terms of the Pooling and Servicing Agreement by any party, or a violation of any fiduciary duty owed by any party to the Certificateholders. The Master Servicer’s or the Trustee’s decision to defer reimbursement of such Non-Recoverable Advances as set forth above is an accommodation to the Certificateholders and is not to be construed as an obligation on the part of the Master Servicer or the Trustee or a right of the Certificateholders.
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Accounts
The Master Servicer will be required to deposit amounts collected in respect of the Mortgage Loans into a segregated account (the “Collection Account”) established pursuant to the Pooling and Servicing Agreement. The Master Servicer will also be required to establish and maintain a segregated custodial account (the “Loan Combination Custodial Account”) with respect to each Serviced Loan Combination (if any), which may be a sub-account of the Collection Account and deposit amounts collected in respect of such Serviced Loan Combination in the related Loan Combination Custodial Account. The Issuing Entity will only be entitled to amounts on deposit in a Loan Combination Custodial Account to the extent these funds are not otherwise payable to a related Companion Loan Holder or payable or reimbursable to any party to the Pooling and Servicing Agreement. Any amounts in a Loan Combination Custodial Account to which the Issuing Entity is entitled will be transferred on a monthly basis to the Collection Account.
The Certificate Administrator will be required to establish and maintain the following two accounts, which may be sub-accounts of a single account: (i) the “Lower-Tier Distribution Account” and (ii) the “Upper Tier Distribution Account” (collectively with the Lower-Tier Distribution Account, the “Distribution Account”). With respect to each Distribution Date, on the related Master Servicer Remittance Date, the Master Servicer will be required to disburse from the Collection Account and remit to the Certificate Administrator for deposit into the Lower-Tier Distribution Account in respect of the related Mortgage Loans, to the extent of funds on deposit in the Collection Account, the Available Funds for such Distribution Date and any prepayment premiums or yield maintenance charges collected during the applicable one-month period ending on the related Determination Date (or, in the case of an Outside Serviced Mortgage Loan, received by the Master Servicer as of the close of business on the business day immediately preceding the applicable Master Servicer Remittance Date and not previously so remitted to the Certificate Administrator). In addition, the Master Servicer will be required to remit to the Certificate Administrator all P&I Advances for deposit into the Lower-Tier Distribution Account on the related Master Servicer Remittance Date. To the extent the Master Servicer fails to do so, the Trustee will deposit all P&I Advances into the Lower-Tier Distribution Account, as applicable, as described in this prospectus supplement. On each Distribution Date, the Certificate Administrator will be required to withdraw amounts distributable on such date on the Regular Certificates, the Class R Certificates (other than in respect of the residual interest in the Lower-Tier REMIC) and the Trust Components first, from the Lower-Tier Distribution Account, and deposit such amounts in the Upper Tier Distribution Account for distribution on the Certificates. See “Description of the Offered Certificates—Distributions” in this prospectus supplement.
The Certificate Administrator will also be required to establish and maintain an account (the “Interest Reserve Account”), which may be a sub-account of the Distribution Account. On each Master Servicer Remittance Date occurring in January (except during a leap year) or February (commencing in 2016) (unless, in either case, the related Distribution Date is the final Distribution Date), the Master Servicer will be required to remit to the Certificate Administrator for deposit, in respect of each Mortgage Loan that accrues interest on an Actual/360 basis, an amount equal to one day’s interest at the related Mortgage Loan Rate (net of the related Administrative Fee Rate) on the respective Stated Principal Balance, as of the close of business on the Distribution Date in the month preceding the month in which such Master Servicer Remittance Date occurs, to the extent the applicable Monthly Payment or a P&I Advance is made in respect of the Monthly Payment (all amounts so deposited in any consecutive January (if applicable) and February, “Withheld Amounts”). On each Master Servicer Remittance Date occurring in March (or February, if such Distribution Date is the final Distribution Date), the Certificate Administrator will be required to withdraw from the Interest Reserve Account an amount equal to the Withheld Amounts, if any, from the preceding January (if applicable) and February, and deposit such amount into the Lower-Tier Distribution Account.
If there are any ARD Loans included in the Issuing Entity, the Certificate Administrator will also be required to establish and maintain an account (the “Excess Interest Distribution Account”), which may be a sub-account of a Distribution Account. The Excess Interest Distribution Account will be an asset of the Grantor Trust. On the Master Servicer Remittance Date immediately preceding the applicable Distribution Date, the Master Servicer is required to remit to the Certificate Administrator for deposit into the Excess Interest Distribution Account an amount equal to the Excess Interest received by the Master Servicer during the applicable one-month period ending on the related Determination Date. Distributions of Excess Interest on the Class S Certificates will be made from the Excess Interest Distribution Account.
The Certificate Administrator will also be required to establish and maintain an account (the “Excess Liquidation Proceeds Reserve Account”), which may be a sub-account of a Distribution Account. To the extent
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that any gains are realized on sales of Mortgaged Properties, such gains will be deposited into the Excess Liquidation Proceeds Reserve Account and applied to all amounts due and payable on the Regular Certificates and the Trust Components and all Realized Losses allocable to such Certificates or Trust Components after application of the Available Funds for such Distribution Date. However, holders of the Class R Certificates will be entitled to distributions of amounts on deposit in the Excess Liquidation Proceeds Reserve Account that exceed amounts reasonably anticipated to be required to offset possible future Realized Losses, as determined by the Special Servicer from time to time, or that remain after all distributions with respect to the Regular Certificates on the final Distribution Date.
The Certificate Administrator will also be required to establish and maintain an account (the “ExchangeableDistribution Account”), for the benefit of holders of Exchangeable Certificates, which may be a sub-account of a Distribution Account. Amounts distributed with respect to a Trust Component are to be deposited in the Exchangeable Distribution Account and then withdrawn and distributed in the appropriate proportions to the holders of the applicable Classes of Exchangeable Certificates.
Other accounts to be established pursuant to the Pooling and Servicing Agreement are one or more REO Accounts for collections from REO Properties.
The Collection Account, any Loan Combination Custodial Account, any REO Account, the Distribution Account, the Interest Reserve Account, the Exchangeable Distribution Account, the Excess Liquidation Proceeds Reserve Account and the Excess Interest Distribution Account will be held in the name of the Certificate Administrator (or the Master Servicer (in the case of the Collection Account and each Loan Combination Custodial Account) or the Special Servicer (in the case of any REO Account)) on behalf of the Trustee for the benefit of the holders of Certificates. Each of the Collection Account, any Loan Combination Custodial Account, any REO Account, the Distribution Account, the Interest Reserve Account, any escrow account, the Exchangeable Distribution Account, the Excess Liquidation Proceeds Reserve Account and the Excess Interest Distribution Account will be held at a depository institution or trust company meeting the requirements of the Pooling and Servicing Agreement or satisfactory to the Rating Agencies.
Amounts on deposit in the Distribution Account, the Exchangeable Distribution Account, the Excess Liquidation Proceeds Reserve Account, the Excess Interest Distribution Account and the Interest Reserve Account will remain uninvested, and such accounts will be non-interest bearing.
Amounts on deposit in the Collection Account, any Loan Combination Custodial Account, the Excess Interest Distribution Account and any REO Account may be invested in certain United States government securities and other high-quality investments meeting the requirements of the Pooling and Servicing Agreement or satisfactory to the Rating Agencies. Interest or other income earned on funds in the Collection Account and any Loan Combination Custodial Account will be paid to the Master Servicer as additional servicing compensation, and interest or other income earned on funds in any REO Account will be payable to the Special Servicer.
If with respect to any Serviced Loan the related Mortgage Loan documents permit the lender to, at its option prior to an event of default under the related Serviced Loan, apply amounts held in any reserve account as a prepayment or hold such amounts in a reserve account, neither the Master Servicer or the Special Servicer, as applicable, may apply such amounts as a prepayment, and will instead continue to hold such amounts in the applicable reserve account. Such amount may be used, if permitted under the Serviced Loan documents, to defease the loan, or may be used to prepay the Serviced Loan upon a subsequent default.
Application of Penalty Charges and Modification Fees
On or prior to the second business day before each Master Servicer Remittance Date, the Master Servicer is required to apply all Penalty Charges and Modification Fees received by it with respect to a Mortgage Loan (including each Outside Serviced Mortgage Loan, to the extent allocable to such Outside Serviced Mortgage Loan pursuant to the related Co-Lender Agreement and remitted to the Master Servicer by the Outside Servicer) or Serviced Loan Combination (subject to the allocation of Penalty Charges under the related Co-Lender Agreement), during the related one-month period ending on the related Determination Date, as follows:
first, to the extent of all Penalty Charges and Modification Fees (in such order), to pay or reimburse the Master Servicer, the Special Servicer and/or the Trustee, as applicable, for all outstanding Advances (including unreimbursed Advances that have been determined to be Non-Recoverable Advances), the related interest on
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Advances and other outstanding additional expenses of the Issuing Entity (exclusive of Special Servicing Fees, Workout Fees and Liquidation Fees) other than Borrower Delayed Reimbursements, in each case, with respect to such Mortgage Loan or Serviced Loan Combination;
second, to the extent of all remaining Penalty Charges and Modification Fees (in such order), as a reimbursement to the Issuing Entity of all Advances (and related interest on Advances) with respect to such Mortgage Loan or Serviced Loan Combination previously determined to be Non-Recoverable Advances and previously reimbursed to the Master Servicer and/or the Trustee, as applicable, from amounts on deposit in the Collection Account (and such amounts will be retained or deposited in the Collection Account as recoveries of such Non-Recoverable Advances and related interest on Non-Recoverable Advances) other than Borrower Delayed Reimbursements;
third, to the extent of all remaining Penalty Charges and Modification Fees (in such order), as a reimbursement to the Issuing Entity of all other additional expenses of the Issuing Entity (exclusive of Special Servicing Fees, Workout Fees and Liquidation Fees) with respect to such Mortgage Loan or Serviced Loan Combination previously paid from the Collection Account or Loan Combination Custodial Account (and such amounts will be retained or deposited in the Collection Account or Loan Combination Custodial Account, as applicable, as recoveries of such additional expenses of the Issuing Entity) other than Borrower Delayed Reimbursements; and
fourth, to the extent of any remaining Penalty Charges and any remaining Modification Fees, to the Master Servicer or the Special Servicer, as applicable, as compensation.
Notwithstanding the foregoing, Penalty Charges collected on any Loan Combination are allocable in accordance with the related Co-Lender Agreement as described under “Description of the Mortgage Pool—The Loan Combinations”above.
Withdrawals from the Collection Account
The Master Servicer may make withdrawals from the Collection Account (exclusive of any Loan Combination Custodial Account that may be a subaccount thereof) for the following purposes, to the extent permitted, as well as any other purpose described in this prospectus supplement (the order set forth below not constituting an order of priority for such withdrawals): (i) to remit on or before each Master Servicer Remittance Date (A) to the Certificate Administrator for deposit into the Lower-Tier Distribution Account an amount equal to the sum of (I) the Available Funds for the related Distribution Date and any prepayment premiums or yield maintenance charges collected during the applicable one-month period ending on the related Determination Date and (II) the Trustee/Certificate Administrator Fee for the related Distribution Date, (B) to the Certificate Administrator for deposit into the Excess Liquidation Proceeds Reserve Account an amount equal to the excess Liquidation Proceeds received in the applicable one-month period ending on the related Determination Date, if any,(C) to the Certificate Administrator for deposit into the Excess Interest Distribution Account an amount equal to the Excess Interest received in the applicable one-month period ending on the related Determination Date, if any, and (D) if such Master Servicer Remittance Date occurs in January (except during a leap year) or February (unless, in either case, the related Distribution Date is the final Distribution Date), to the Certificate Administrator for deposit into the Interest Reserve Account an amount required to be withheld as described above under “—Accounts,” (ii) to pay or reimburse the Master Servicer and the Trustee, as applicable, pursuant to the terms of the Pooling and Servicing Agreement for Advances made by any of them and interest on Advances (the Master Servicer’s or the Trustee’s right, as applicable, to reimbursement for items described in this clause (ii) being limited as described above under “—Advances”), (iii) to pay on or before each Master Servicer Remittance Date (x) to the Master Servicer as compensation, the aggregate unpaid Servicing Fee earned with respect to the Mortgage Loans through the end of the most recently ended Interest Accrual Period, and (y) to the Special Servicer as compensation, unpaid special servicing compensation earned with respect to the Mortgage Loans through the immediately preceding Determination Date (or, in the case of Special Servicing Fees, accrued with respect to the Mortgage Loans that are Specially Serviced Loans through the end of the most recently ended Interest Accrual Period), (iv) to pay to the Operating Advisor the Operating Advisor Consulting Fee (but only to the extent actually received from the related borrower) and the Operating Advisor Fee, (v) to pay on or before each Distribution Date to any person with respect to each related Mortgage Loan or REO Property that has previously been purchased or repurchased by such person pursuant to the Pooling and Servicing Agreement, a Mortgage Loan Purchase Agreement, a Co-Lender Agreement (if applicable) or a mezzanine intercreditor agreement, all amounts received on such Mortgage Loan or REO Property during the applicable one-month period ending on the related
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Determination Date and subsequent to the date as of which the amount required to effect such purchase or repurchase was determined, (vi) to the extent not reimbursed or paid pursuant to any of the above clauses, to reimburse or pay the Master Servicer, the Special Servicer, the Trustee, the Certificate Administrator, the Operating Advisor and/or the Depositor for unpaid compensation (in the case of the Master Servicer, the Special Servicer, the Trustee, the Certificate Administrator or the Operating Advisor), unpaid additional expenses of the Issuing Entity and certain other unreimbursed expenses incurred by such person pursuant to and to the extent reimbursable under the Pooling and Servicing Agreement and to satisfy any indemnification obligations of the Issuing Entity under the Pooling and Servicing Agreement, (vii) to pay to the Certificate Administrator amounts reasonably determined by the Certificate Administrator to be necessary to pay any applicable federal, state or local taxes imposed on either Trust REMIC, (viii) to pay the CREFC® Intellectual Property Royalty License Fee, (ix) to withdraw any amount deposited into the Collection Account that was not required to be deposited in the Collection Account, and (x) to clear and terminate the Collection Account pursuant to a plan for termination and liquidation of the Issuing Entity. However, certain of the foregoing withdrawals of items specifically related to a Serviced Loan Combination or related REO Property will first be made out of the related Loan Combination Custodial Account and will be made out of the Collection Account only if and to the extent that amounts in the related Loan Combination Custodial Account are insufficient or, based on the related Co-Lender Agreement, unavailable to make the relevant payment or reimbursement. If the Master Servicer makes any reimbursement or payment out of the Collection Account to cover the related Serviced Companion Loan Holder’s share of any cost, expense, indemnity, Property Advance or interest on such Property Advance, or fee with respect to a Serviced Loan Combination (taking into account the subordinate nature of any related Subordinate Companion Loan), then the Master Servicer (with respect to non-Specially Serviced Loans) and the Special Servicer (with respect to Specially Serviced Loans) must use efforts consistent with the Servicing Standard to collect such amount out of collections on such Serviced Companion Loan or, if and to the extent permitted under the related Co-Lender Agreement, from such Serviced Companion Loan Holder. The Master Servicer will also be entitled to make withdrawals from the Collection Account of amounts necessary for the payments or reimbursements required to be paid to the parties to, and/or the securitization trust created under, any Outside Servicing Agreement pursuant to the related Co-Lender Agreement.
If a P&I Advance is made with respect to any Serviced Mortgage Loan that is part of a Serviced Pari Passu Loan Combination, then that P&I Advance, together with interest on such P&I Advance, may only be reimbursed out of future payments and collections on that Serviced Mortgage Loan or, as and to the extent described under “—Advances” above, on other Mortgage Loans, but not out of payments or other collections on the related Serviced Pari Passu Companion Loan. Likewise, the Trustee/Certificate Administrator Fee and the Operating Advisor Fee that accrue with respect to any Serviced Mortgage Loan that is part of a Serviced Loan Combination and any other amounts payable to the Operating Advisor may only be paid out of payments and other collections on such Serviced Mortgage Loan and/or the Mortgage Pool generally, but not out of payments or other collections on the related Serviced Companion Loan.
Enforcement of “Due-On-Sale” and “Due-On-Encumbrance” Clauses
Due-On-Sale
Subject to the discussion under “—Directing Holder” and “—Operating Advisor” below and “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement, the Master Servicer (with respect to Serviced Loans that are non-Specially Serviced Loans and with the Special Servicer’s consent) and the Special Servicer (with respect to Specially Serviced Loans) will be required to determine, in a manner consistent with the Servicing Standard, whether to waive any right the lender under any Serviced Loan may have under a due-on-sale clause (which will include, without limitation, sale or transfers of Mortgaged Properties, in full or in part, or the sale, transfer, pledge or hypothecation of direct or indirect interests in the borrower or its owner, to the extent prohibited under the related Mortgage Loan documents) to accelerate payment of that Serviced Loan. With respect to any Serviced Loans that are non-Specially Serviced Loans, the Master Servicer or, in the case of Specially Serviced Loans, the Special Servicer, each in a manner consistent with the Servicing Standard, will be required, to the extent permitted by applicable law, to enforce the restrictions contained in the related Mortgage Loan documents on transfers of the related Mortgaged Property and on transfers of interests in the related borrower, unless following its receipt of a request of a waiver or consent in respect of a due-on-sale provision the Master Servicer (with the written consent of the Special Servicer) or the Special Servicer, as applicable, has determined (subject to the discussion under “—Directing Holder” below and “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement), consistent with the Servicing Standard, that the waiver of such restrictions or granting of consent would be in accordance with the Servicing Standard. However, neither
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the Master Servicer nor the Special Servicer may waive the rights of the lender or grant its consent under any due-on-sale clause, unless—
· | the Master Servicer or the Special Servicer, as applicable, has received a Rating Agency Confirmation, or |
· | such Serviced Mortgage Loan (or the Serviced Mortgage Loan related to the Serviced Loan Combination) (A) represents less than 5% of the principal balance of all of the Mortgage Loans in the Issuing Entity, (B) has a principal balance that is $35 million or less, and (C) is not one of the 10 largest Mortgage Loans (considering any Crossed Group as a single Mortgage Loan) in the pool based on principal balance (although no such Rating Agency Confirmation will be required if such Serviced Mortgage Loan has a principal balance less than $10,000,000). |
Due-On-Encumbrance
Subject to the discussion under “—Directing Holder” and “—Operating Advisor” below and “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement, the Master Servicer (with respect to Serviced Loans that are non-Specially Serviced Loans, and with the Special Servicer’s consent) and the Special Servicer (with respect to Specially Serviced Loans) will be required to determine, in a manner consistent with the Servicing Standard, whether to waive any right the lender under any such Serviced Loan may have under a due-on-encumbrance clause (which will include, without limitation, any mezzanine/subordinate financing of the borrower or the Mortgaged Property or any sale or transfer of preferred equity in the borrower or its owners, to the extent prohibited under the related Mortgage Loan documents) to accelerate payment of that Serviced Loan. With respect to any Serviced Loans that are non-Specially Serviced Loans, the Master Servicer or, in the case of Specially Serviced Loans, the Special Servicer, each in a manner consistent with the Servicing Standard, will be required, to the extent permitted by applicable law, to enforce the restrictions contained in the related Mortgage Loan documents on further encumbrances of the related Mortgaged Property and on further encumbrances of interests in the related borrower, unless following its receipt of a request of a waiver or consent in respect of a due-on-encumbrance provision the Master Servicer (with the written consent of the Special Servicer) or the Special Servicer, as applicable, has determined (subject to the discussion under “—Directing Holder” below and “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement), consistent with the Servicing Standard, that the waiver of such restrictions or granting of consent would be in accordance with the Servicing Standard. However, neither the Master Servicer nor the Special Servicer may waive the rights of the lender or grant its consent under any due-on-encumbrance clause, unless—
· | the Master Servicer or the Special Servicer, as applicable, has received a Rating Agency Confirmation, or |
· | such Serviced Mortgage Loan (or the Serviced Mortgage Loan related to the Serviced Loan Combination) (A) represents less than 2% of the principal balance of all of the Mortgage Loans in the Issuing Entity, (B) has a principal balance that is $20 million or less, (C) has a loan-to-value ratio equal to or less than 85% (including any existing and proposed debt), (D) has a debt service coverage ratio equal to or greater than 1.20x (in each case, determined based upon the aggregate of the principal balance of the Serviced Mortgage Loan, any related Serviced Companion Loan (if applicable) and the principal amount of the proposed additional lien) and (E) is not one of the 10 largest Mortgage Loans (considering any Crossed Group as a single Mortgage Loan) in the pool based on principal balance (although no such Rating Agency Confirmation will be required if such Mortgage Loan has a principal balance less than $10,000,000). |
Notwithstanding the foregoing, without any other approval or consent, the Master Servicer (for non-Specially Serviced Loans) or the Special Servicer (for Specially Serviced Loans) may grant and process a borrower’s request for consent to subject the related Mortgaged Property to an immaterial easement, right of way or similar agreement for utilities, access, parking, public improvements or another purpose and may consent to subordination of the related Mortgage Loan to such easement, right of way or similar agreement.
See “Certain Legal Aspects of the Mortgage Loans—Due-on-Sale and Due-on-Encumbrance Provisions” in the prospectus.
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Inspections
The Master Servicer (or with respect to any Specially Serviced Loan, the Special Servicer) is required to inspect or cause to be inspected each Mortgaged Property (other than a Mortgaged Property securing the Outside Serviced Mortgage Loans) at such times and in such manner as are consistent with the Servicing Standard, but in any event at least once every calendar year with respect to Serviced Mortgage Loans with an outstanding principal balance of $2,000,000 or more and at least once every other calendar year with respect to Serviced Mortgage Loans with an outstanding principal balance of less than $2,000,000, in each case commencing in 2016;provided that the Master Servicer is not required to inspect any Mortgaged Property that has been inspected by the Special Servicer during the preceding 12 months. The Special Servicer is required to inspect the Mortgaged Property securing each Serviced Loan that becomes a Specially Serviced Loan as soon as practicable after it becomes a Specially Serviced Loan and thereafter at least once every calendar year until such condition ceases to exist. The cost of any such inspection is required to be borne by the Master Servicer unless the related Serviced Loan is a Specially Serviced Loan, in which case the Master Servicer will be required to reimburse the Special Servicer for such cost as a Property Advance (or as an expense of the Issuing Entity if the Property Advance would be a Non-Recoverable Advance) and any out-of-pocket costs will be borne by the Issuing Entity.
Evidence as to Compliance
Each of the Master Servicer, the Special Servicer (regardless of whether it has commenced special servicing of any Mortgage Loan) and the Certificate Administrator are required under the Pooling and Servicing Agreement to deliver (and each of the Master Servicer and the Certificate Administrator is required to cause (or, in the case of a sub-servicer retained at the request of a Sponsor, use commercially reasonable efforts to cause) any affiliated sub-servicer, or any of its other sub-servicers that is servicing at least 10% of the Mortgage Loans by balance, to deliver) annually to, among others, the Certificate Administrator and the Operating Advisor (only in the case of an officer’s certificate furnished by the Special Servicer and after the occurrence and during the continuance of a Control Termination Event) and the Depositor on or before the date specified in the Pooling and Servicing Agreement, a certificate of an authorized officer of such party stating, among other things, that (i) a review of that party’s servicing activities during the preceding calendar year or portion of that year and of performance under the Pooling and Servicing Agreement (or the related sub-servicing agreement in the case of a sub-servicer, as applicable) has been made under such officer’s supervision and (ii) to the best of such officer’s knowledge, based on the review, such party has fulfilled all of its obligations under the Pooling and Servicing Agreement (or the related sub-servicing agreement in the case of a sub-servicer, as applicable) in all material respects throughout the preceding calendar year or portion of the preceding year, or, if there has been a failure to fulfill any such obligation in any material respect, specifying the failure known to such officer and the nature and status of the failure. In general, none of these parties will be responsible for the performance by any other such party of that other party’s duties described above.
In addition, the Master Servicer, the Special Servicer (regardless of whether a special servicer has commenced special servicing of any Mortgage Loan), the Certificate Administrator and the Operating Advisor are each (at its own expense) required to furnish (and each of the preceding parties, as applicable, is required to cause (or, in the case of a Servicing Function Participant retained at the request of a Sponsor, to use commercially reasonable efforts to cause) each Servicing Function Participant retained by it to furnish), annually, to, among others, the Certificate Administrator, the Trustee, the Operating Advisor (in the case of the Special Servicer only and only after the occurrence and during the continuance of a Control Termination Event) and the Depositor, a report (an “Assessment of Compliance”) assessing compliance by that party with the servicing criteria set forth in Item 1122(d) of Regulation AB that contains the following:
· | a statement of the party’s responsibility for assessing compliance with the servicing criteria set forth in Item 1122(d) of Regulation AB applicable to it; |
· | a statement that the party used the criteria in Item 1122(d) of Regulation AB to assess compliance with the applicable servicing criteria; |
· | the party’s assessment of compliance with the applicable servicing criteria during and as of the end of the preceding calendar year, setting forth any material instance of noncompliance identified by the party, a discussion of each such failure and the nature and status of each such failure; and |
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· | a statement that a registered public accounting firm has issued an attestation report (an“Attestation Report”) on the party’s assessment of compliance with the applicable servicing criteria during and as of the end of the preceding calendar year. |
Each party that is required to deliver an Assessment of Compliance will also be required to simultaneously deliver an Attestation Report of a registered public accounting firm, prepared in accordance with the standards for attestation engagements issued or adopted by the public company accounting oversight board, that expresses an opinion, or states that an opinion cannot be expressed (and the reasons for this), concerning the party’s assessment of compliance with the applicable servicing criteria set forth in Item 1122(d) of Regulation AB.
For the avoidance of doubt, the Trustee shall have no obligation or duty to determine whether any Assessment of Compliance provided by the Master Servicer, the Special Servicer or any other Servicing Function Participant is in form and substance in compliance with the requirements of Regulation AB.
A “Servicing Function Participant” is any person or entity, other than the Certificate Administrator, the Operating Advisor, the Master Servicer, the Special Servicer and the Trustee, that is performing activities with respect to the Issuing Entity that address the servicing criteria set forth in Item 1122(d) of Regulation AB, unless those activities relate to 5% or less of the Mortgage Loans by balance.
Certain Matters Regarding the Depositor, the Master Servicer, the Special Servicer and the Operating Advisor
Each of the Master Servicer, the Special Servicer and the Operating Advisor may assign its rights and delegate its duties and obligations under the Pooling and Servicing Agreement;provided that certain conditions are satisfied including obtaining a Rating Agency Confirmation. The resigning Master Servicer, Special Servicer or Operating Advisor, as applicable, must pay all costs and expenses associated with the transfer of its duties after resignation. The Pooling and Servicing Agreement provides that the Master Servicer, the Special Servicer or the Operating Advisor, as the case may be, may not otherwise resign from its obligations and duties as Master Servicer, Special Servicer or Operating Advisor, as the case may be, except upon the determination that performance of its duties is no longer permissible under applicable law andprovided that such determination is evidenced by an opinion of counsel to that effect delivered to the Trustee and the Certificate Administrator. No such resignation may become effective until the Trustee (solely with respect to the Master Servicer or the Special Servicer) or a successor Master Servicer, Special Servicer or Operating Advisor has assumed the obligations of the Master Servicer, the Special Servicer or the Operating Advisor, as applicable, under the Pooling and Servicing Agreement. The Trustee or any other successor Master Servicer, Special Servicer or Operating Advisor assuming the obligations of the Master Servicer, the Special Servicer or the Operating Advisor under the Pooling and Servicing Agreement will be entitled to the compensation to which the Master Servicer, the Special Servicer or the Operating Advisor would have been entitled after the date of assumption of such obligations (other than certain Workout Fees which the prior Special Servicer will be entitled to retain and other than the excess servicing portion of the Servicing Fee which, subject to reduction in order to retain a successor, may be retained or transferred by the initial Master Servicer). If no successor Master Servicer, Special Servicer or Operating Advisor can be obtained to perform such obligations for such compensation, additional amounts payable to such successor Master Servicer, Special Servicer or Operating Advisor will result in shortfalls in distributions on the Certificates. Notwithstanding the foregoing, the Operating Advisor may resign, without payment of any penalty, at any time after the Certificate Principal Amounts of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB, Class A-S, Class B, Class PEZ, Class C and Class D Certificates have been reduced to zero. In such circumstance, no replacement Operating Advisor will be required to be appointed.
The Pooling and Servicing Agreement also provides that none of the Depositor, the Master Servicer, the Special Servicer, the Operating Advisor, or any director, member, manager, officer, employee or agent of the Depositor, the Master Servicer, the Special Servicer or the Operating Advisor will be under any liability to the Issuing Entity, the holders of the Certificates, a Companion Loan Holder, or any other person for any action taken or for refraining from the taking of any action in good faith pursuant to the Pooling and Servicing Agreement, or for errors in judgment. However, none of the Depositor, the Master Servicer, the Special Servicer, the Operating Advisor or any such person will be protected against any liability which would otherwise be imposed by reason of (i) any breach of warranty or representation by such party in the Pooling and Servicing Agreement, or (ii) any willful misconduct, bad faith, fraud or negligence by such party in the performance of its respective obligations and duties under the Pooling and Servicing Agreement or by reason of negligent disregard by such party of its respective obligations or duties under the Pooling and Servicing Agreement. In addition, each of the Master
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Servicer, the Special Servicer and the Operating Advisor will indemnify the Issuing Entity against any and all loss, liability or reasonable expenses (including, without limitation, reasonable attorneys’ fees and expenses) incurred by the Issuing Entity as a result of any willful misconduct, bad faith, fraud or negligence in the performance of the respective duties of the Master Servicer, the Special Servicer or the Operating Advisor, as the case may be, or by reason of negligent disregard of the Master Servicer’s, the Special Servicer’s or the Operating Advisor’s, as the case may be, obligations or duties under the Pooling and Servicing Agreement.
The Pooling and Servicing Agreement further provides that the Depositor, the Master Servicer, the Special Servicer, the Operating Advisor and any director, member, manager, officer, employee or agent of the Depositor, the Master Servicer, the Special Servicer or the Operating Advisor will be entitled to indemnification by the Issuing Entity for any loss, liability, penalty, fine, forfeiture, claim, judgment or expense incurred in connection with, or relating to, the Pooling and Servicing Agreement or the Certificates, other than any such loss, liability, penalty, fine, forfeiture, claim, judgment or expense: (i) specifically required to be borne by the party seeking indemnification, without right of reimbursement pursuant to the terms of the Pooling and Servicing Agreement; (ii) which constitutes an Advance that is otherwise reimbursable under the Pooling and Servicing Agreement; (iii) resulting from any breach on the part of that party of a representation or warranty made in the Pooling and Servicing Agreement; or (iv) incurred by reason of any willful misconduct, bad faith, fraud or negligence on the part of that party in the performance of its obligations or duties under the Pooling and Servicing Agreement or negligent disregard of such obligations or duties.
In addition, the Pooling and Servicing Agreement provides that none of the Depositor, the Master Servicer, the Special Servicer, the Certificate Administrator, the Trustee or the Operating Advisor will be under any obligation to appear in, prosecute or defend any legal action unless such action is related to its duties under the Pooling and Servicing Agreement and which in its opinion does not expose it to any expense or liability for which reimbursement is not reasonably assured. The Depositor, the Master Servicer, the Special Servicer, the Certificate Administrator, the Trustee or the Operating Advisor may, however, in its discretion undertake any such action which it may deem necessary or desirable with respect to the Pooling and Servicing Agreement and the rights and duties of the parties to the Pooling and Servicing Agreement and the interests of the holders of Certificates under the Pooling and Servicing Agreement. In such event, the reasonable legal expenses and costs of such action and any liability resulting from such action will be expenses, costs and liabilities of the Issuing Entity, and the Depositor, the Master Servicer, the Special Servicer, the Certificate Administrator, the Trustee and the Operating Advisor will be entitled to be reimbursed for those amounts from the Collection Account.
The Depositor is not obligated to monitor or supervise the performance of the Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator or the Trustee under the Pooling and Servicing Agreement. The Depositor may, but is not obligated to, enforce the obligations of the Master Servicer or the Special Servicer under the Pooling and Servicing Agreement and may, but is not obligated to, perform or cause a designee to perform any defaulted obligation of the Master Servicer or the Special Servicer or exercise any right of the Master Servicer or the Special Servicer under the Pooling and Servicing Agreement. In the event the Depositor undertakes any such action, it will be reimbursed and indemnified by the Issuing Entity to the extent not recoverable from the Master Servicer or the Special Servicer, as applicable. Any such action by the Depositor will not relieve the Master Servicer or the Special Servicer of its obligations under the Pooling and Servicing Agreement.
The Pooling and Servicing Agreement provides that, with respect to each Outside Serviced Mortgage Loan, each of (a) (as and to the same extent the Outside Securitization is required to indemnify each of the following parties in respect of other mortgage loans in such Outside Securitization pursuant to the terms of the Outside Servicing Agreement) the Outside Servicer, the Outside Special Servicer, the Outside Trustee and the certificate administrator, the operating advisor and the depositor under the Outside Servicing Agreement (and any director, officer, employee or agent of any of the foregoing, to the extent such parties are identified as indemnified parties in the Outside Servicing Agreement in respect of other mortgage loans included in such Outside Securitization) and (b) the Outside Securitization (such parties in clause (a) and the Outside Securitization collectively, the “Pari Passu Indemnified Parties”) shall be entitled to be indemnified against any claims, losses, penalties, fines, forfeitures, legal fees and related costs, judgments and any other costs, liabilities, fees and expenses incurred in connection with the servicing and administration of such Outside Serviced Mortgage Loan and the related Mortgaged Property (or, with respect to the operating advisor under the Outside Servicing Agreement, incurred in connection with the provision of services for such Outside Serviced Mortgage Loan) under the Outside Servicing Agreement (collectively, the “Pari Passu Indemnified Items”) to the extent of the Issuing Entity’s pro rata share of such Pari Passu Indemnified Items, and to the extent amounts on deposit in the related “whole loan custodial
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account” maintained pursuant to the Outside Servicing Agreement that are allocated to such Outside Serviced Mortgage Loan are insufficient for reimbursement of such amounts, such Indemnified Party shall be entitled to be reimbursed by the Issuing Entity (including out of general collections in the Collection Account) for the Issuing Entity’s pro rata share of the insufficiency.
In addition, the Co-Lender Agreement executed with respect to each Outside Serviced Loan Combination provides that this securitization transaction is obligated to promptly reimburse the Outside Servicer, the Outside Special Servicer, the Outside Trustee, the certificate administrator under the Outside Servicing Agreement or the Outside Securitization, as applicable, for the Issuing Entity’s pro rata share of any fees, costs or expenses incurred in connection with the servicing and administration such Outside Serviced Loan Combination as to which the Outside Securitization or any of the parties thereto are entitled to be reimbursed pursuant to the terms of the Outside Servicing Agreement. Reimbursement of such pro rata share will be made out of general collections in the Issuing Entity’s Collection Account, to the extent reimbursement out of collections on the Outside Serviced Mortgage Loan are insufficient therefor.
Servicer Termination Events
“Servicer Termination Events” under the Pooling and Servicing Agreement with respect to the Master Servicer or the Special Servicer, as the case may be, will include, without limitation:
(a) (i) any failure by the Master Servicer to make a required deposit to the Collection Account or any Loan Combination Custodial Account or make a required remittance to any Serviced Companion Loan Holder, on the day such deposit or remittance was first required to be made, which failure is not remedied within one business day or (ii) any failure by the Master Servicer to deposit into, or remit to the Certificate Administrator for deposit into, the Distribution Account any amount required to be so deposited or remitted, which failure is not remedied by 11:00 a.m., New York City time, on the relevant Distribution Date;
(b) any failure by the Special Servicer to deposit into any REO Account within two business days after the day such deposit is required to be made, or to remit to the Master Servicer for deposit in the Collection Account or any Loan Combination Custodial Account such remittance required to be made by the Special Servicer within one business day after such remittance is required to be made, under the Pooling and Servicing Agreement;
(c) any failure by the Master Servicer or the Special Servicer duly to observe or perform in any material respect any of its other covenants or obligations under the Pooling and Servicing Agreement, which failure continues unremedied for 30 days (10 days in the case of the Master Servicer’s failure to make a Property Advance or 20 days in the case of a failure to pay the premium for any insurance policy required to be maintained under the Pooling and Servicing Agreement or such shorter period (not less than two business days) as may be required to avoid the commencement of foreclosure proceedings for unpaid real estate taxes or the lapse of insurance, as applicable) after written notice of the failure has been given to the Master Servicer or the Special Servicer, as the case may be, by any other party to the Pooling and Servicing Agreement, or to the Master Servicer or the Special Servicer, as the case may be, with a copy to each other party to the related Pooling and Servicing Agreement, by Certificateholders of any Class, evidencing, as to that Class, not less than 25% of the Voting Rights allocable thereto (considering each Class of the Class A-S, Class B and Class C Certificates together with the Class PEZ Component with the same alphabetical designation as a single “Class” for such purpose), or, if affected thereby, by the Serviced Companion Loan Holder;provided,however, if that failure is capable of being cured and the Master Servicer or the Special Servicer, as applicable, is diligently pursuing that cure, that 30-day period will be extended an additional 60 days (provided that the Master Servicer, or the Special Servicer, as applicable, has commenced to cure such failure within the initial 30-day period and has certified that it has diligently pursued, and is continuing to pursue, a full cure);
(d) any breach on the part of the Master Servicer or the Special Servicer of any representation or warranty in the Pooling and Servicing Agreement, which materially and adversely affects the interests of any Class of Certificateholders or a Serviced Companion Loan Holder, as applicable, and which continues unremedied for a period of 30 days after the date on which notice of that breach, requiring the same to be remedied, has been given to the Master Servicer or the Special Servicer, as the case may be, by the Depositor, the Certificate Administrator or the Trustee, or to the Master Servicer, the Special Servicer, the Depositor, the Certificate Administrator and the Trustee by the holders of Certificates entitled to not less than
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25% of the Voting Rights, or, if affected thereby, by the Serviced Companion Loan Holder;provided,however, if that breach is capable of being cured and the Master Servicer or the Special Servicer, as applicable, is diligently pursuing that cure, that 30-day period will be extended an additional 60 days (provided that the Master Servicer, or the Special Servicer, as applicable, has commenced to cure such failure within the initial 30-day period and has certified that it has diligently pursued, and is continuing to pursue, a full cure);
(e) certain events of insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings in respect of or relating to the Master Servicer or the Special Servicer, and certain actions by or on behalf of the Master Servicer or the Special Servicer indicating its insolvency or inability to pay its obligations;
(f) either of Moody’s or Kroll Bond Rating Agency, Inc. (“KBRA”) (or, in the case of Serviced Companion Loan Securities, any Companion Loan Rating Agency) has (i) qualified, downgraded or withdrawn its rating or ratings of one or more Classes of Certificates or Serviced Companion Loan Securities, or (ii) placed one or more Classes of Certificates or Serviced Companion Loan Securities on “watch status” in contemplation of rating downgrade or withdrawal and, in the case of either of clauses (i) or (ii), publicly citing servicing concerns with the Master Servicer or the Special Servicer, as applicable, as the sole or material factor in such rating action (and such qualification, downgrade, withdrawal or “watch status” placement has not been withdrawn by such Rating Agency (or, in the case of Serviced Companion Loan Securities, such Companion Loan Rating Agency) within 60 days of such event);
(g) the Master Servicer or the Special Servicer, as applicable, ceases to have a master servicer or special servicer ranking, as applicable, of at least “MOR CS3” from Morningstar and that ranking is not reinstated within 60 days; or
(h) the Master Servicer or the Special Servicer, as applicable, or any primary servicer or sub-servicer appointed by the Master Servicer or the Special Servicer, as applicable, after the Closing Date (but excluding any primary servicer or sub-servicer which the Master Servicer has been instructed to retain by the Depositor or a Sponsor), (i) fails to deliver the items required by the Pooling and Servicing Agreement after any applicable notice and cure period to enable the Certificate Administrator or Depositor to comply with the Issuing Entity’s reporting obligations under the Exchange Act or (ii) for so long as the trust created pursuant to the securitization of a Serviced Companion Loan is subject to the reporting requirements of Regulation AB or the Exchange Act, fails to deliver any Exchange Act reporting items required to be delivered by such servicer pursuant to the Pooling and Servicing Agreement at the times required under the Pooling and Servicing Agreement after any applicable notice and cure periods (and any primary servicer or sub-servicer that defaults in accordance with this clause may be terminated at the direction of the Depositor).
“Serviced Companion Loan Securities” mean any commercial mortgage-backed securities that evidence an interest in or are secured by the assets of an issuing entity, which assets include a Serviced Companion Loan (or a portion of or interest in a Serviced Companion Loan).
“Companion Loan Rating Agency” means, with respect to any Serviced Companion Loan, any rating agency that was engaged by a participant in the securitization of such Serviced Companion Loan to assign a rating to the related Serviced Companion Loan Securities.
Rights Upon Servicer Termination Event
If a Servicer Termination Event with respect to the Master Servicer or the Special Servicer is continuing and has not been remedied, then either (i) the Trustee may or (ii) upon the written direction of the holders of Certificates evidencing at least 25% of the aggregate Voting Rights of all Certificates (or, solely in the case of a Serviced Loan Combination only, subject to the discussion below, upon the written direction of the affected Serviced Companion Loan Holder) to the Trustee, the Trustee will be required to, terminate all of the rights and obligations of the Master Servicer as master servicer or the Special Servicer as special servicer under the Pooling and Servicing Agreement and in and to the Issuing Entity (except in its capacity as a Certificateholder). Notwithstanding the foregoing, upon any termination of the Master Servicer or the Special Servicer under the Pooling and Servicing Agreement, the Master Servicer or the Special Servicer will continue to be entitled to any rights that accrued prior to the date of such termination (including the right to receive all accrued and unpaid servicing and special servicing compensation through the date of termination plus reimbursement for all Advances and interest on such Advances as provided in the Pooling and Servicing Agreement).
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On and after the date of termination following a Servicer Termination Event by the Master Servicer or the Special Servicer, as the case may be, the Trustee will succeed to all authority and power of the Master Servicer or the Special Servicer, as the case may be, under the Pooling and Servicing Agreement and will be entitled to the compensation arrangements to which the Master Servicer or the Special Servicer, as the case may be, would have been entitled (unless previously earned by the Master Servicer or the Special Servicer, as the case may be). If the Trustee is unwilling or unable so to act, or if the holders of Certificates evidencing at least 25% of the aggregate Voting Rights of all Certificateholders so request, or if the Rating Agencies do not provide a Rating Agency Confirmation with respect to the Trustee so acting, the Trustee must appoint, or petition a court of competent jurisdiction for the appointment of, a mortgage loan servicing institution to act as successor to the Master Servicer or the Special Servicer, as applicable, under the Pooling and Servicing Agreement;provided a Rating Agency Confirmation must be obtained regarding appointment of the proposed successor at the expense of the terminated Master Servicer or Special Servicer, as applicable, or, if the expense is not so recovered, at the expense of the Issuing Entity;provided, further, that, the related Outside Controlling Note Holder will have the right to approve a successor Special Servicer with respect to any Serviced Outside Controlled Loan Combination, and prior to the occurrence and continuance of a Control Termination Event, the Controlling Class Representative will have the right to approve a successor Special Servicer with respect to the other Serviced Loans. Pending such appointment, the Trustee is obligated to act in such capacity in accordance with the Pooling and Servicing Agreement. The Trustee and any such successor may agree upon the servicing compensation to be paid;provided, however, that the servicing compensation may not be in excess of that permitted to the terminated Master Servicer or Special Servicer, as applicable, unless no successor can be obtained to perform the obligations for that compensation; andprovided, further, that, for so long as no Consultation Termination Event has occurred and is continuing, the Trustee will be required to consult with the Controlling Class Representative (and, if a Serviced Outside Controlled Loan Combination is affected, the Trustee will be required to consult with the related Outside Controlling Note Holder) prior to the appointment of a successor Master Servicer or Special Servicer at a servicing compensation in excess of that permitted to the terminated Master Servicer or Special Servicer, as applicable. Any compensation in excess of that payable to the predecessor Master Servicer or the Special Servicer may result in Realized Losses or other shortfalls on the Certificates.
Notwithstanding the foregoing, (1) if any Servicer Termination Event on the part of the Master Servicer affects a Serviced Companion Loan, the related Serviced Companion Loan Holder or the rating on a class of the related Serviced Companion Loan Securities, and if the Master Servicer is not otherwise terminated, or (2) if a Servicer Termination Event on the part of the Master Servicer affects only a Serviced Companion Loan, the related Serviced Companion Loan Holder or the rating on a class of related Serviced Companion Loan Securities, then the Master Servicer may not be terminated by or at the direction of the related Serviced Companion Loan Holder or the holders of any Certificates, but upon the written direction of the related Serviced Companion Loan Holder, the Master Servicer will be required to appoint a sub-servicer that will be responsible for servicing the related Serviced Loan Combination. Also, notwithstanding the foregoing, if a Servicer Termination Event described in clauses (a), (b), (c), (d), (f) or (g) under “—Servicer Termination Events” on the part of the Special Servicer affects only a Serviced Companion Loan, a Serviced Companion Loan Holder or a rating on any Serviced Companion Loan Securities, then it will not be a Servicer Termination Event with respect to the Mortgage Pool as a whole, but the related Serviced Companion Loan Holder may terminate the Special Servicer with respect to the related Serviced Loan Combination.
Notwithstanding the foregoing discussion in this “—Rights Upon Servicer Termination Event” section, if the Master Servicer is terminated under the circumstances described above because of the occurrence of any of the Servicer Termination Events described in clause (f) or (g) under “—Servicer Termination Events” above, the Master Servicer will have the right for a period of 45 days (during which time it will continue to serve as Master Servicer), at its expense, to sell its master servicing rights with respect to the Mortgage Loans to a Master Servicer as to which the Rating Agencies have provided a Rating Agency Confirmation.
No Certificateholder will have any right under the Pooling and Servicing Agreement to institute any proceeding with respect to the Pooling and Servicing Agreement or the Mortgage Loans, unless, with respect to the Pooling and Servicing Agreement, such holder previously has given to the Trustee a written notice of a default under the Pooling and Servicing Agreement, and of the continuance of the default, and unless also the holders of at least 25% of the Voting Rights of any Class affected thereby (considering each of the Class A-S, Class B and Class C Certificates together with the Class PEZ Component of the same alphabetical designation as a single “Class” for such purpose) have made written request of the Trustee (with a copy to the Certificate Administrator) to institute such proceeding in its own name as Trustee under the Pooling and Servicing Agreement and have offered to the Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to
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be incurred in connection with such proceeding, and the Trustee, for 60 days after its receipt of such notice, request and offer of indemnity, has neglected or refused to institute such proceeding.
The Trustee will have no obligation to make any investigation of matters arising under the Pooling and Servicing Agreement or to institute, conduct or defend any litigation under the Pooling and Servicing Agreement or in relation to it at the request, order or direction of any of the holders of Certificates, unless such holders of Certificates have offered to the Trustee security or indemnity reasonably satisfactory to it against the costs, expenses and liabilities which may be incurred in connection with such action.
In addition, the Depositor may terminate each of the Master Servicer and the Special Servicer upon five business days’ notice if the Master Servicer or the Special Servicer, as the case may be, fails to comply with certain of its reporting obligations under the Pooling and Servicing Agreement.
Waivers of Servicer Termination Events
A Servicer Termination Event may be waived by the Certificateholders evidencing not less than 66-2/3% of the aggregate Voting Rights of the Certificates (and, if such Servicer Termination Event is on the part of a Special Servicer with respect to a Serviced Loan Combination only, by the related Serviced Companion Loan Holder). Notwithstanding the foregoing, (1) a Servicer Termination Event under clause (a) or (b) under “—Servicer Termination Events” above may be waived only with the consent of all of the Certificateholders of the affected Classes (considering each of the Class A-S, Class B and Class C Certificates together with the Class PEZ Component of the same alphabetical designation as a single “Class” for such purpose), and (2) a Servicer Termination Event under clause (h) under “—Servicer Termination Events” above may be waived only with the consent of the Depositor, together with (in the case of each of clauses (1) and (2) of this sentence) the consent of any Serviced Companion Loan Holder affected by such Servicer Termination Event. If a Servicer Termination Event on the part of the Master Servicer is waived in connection with a Serviced Loan Combination, the related Serviced Companion Loan Holder may require that the Master Servicer appoint a sub-servicer to service the related Serviced Loan Combination, which sub-servicer is the subject of a Rating Agency Confirmation.
Termination of the Special Servicer
The Special Servicer may be removed, and a successor Special Servicer appointed, at any time, as follows:
(a) if a Control Termination Event has not occurred (or has occurred, but is no longer continuing), the Special Servicer may be removed and replaced at any time with or without cause with respect to the Serviced Loans (excluding any Serviced Outside Controlled Loan Combination) at the direction of the Controlling Class Representative upon satisfaction of certain conditions specified in the Pooling and Servicing Agreement (including the delivery of a Rating Agency Confirmation);
(b) if a Control Termination Event has occurred and is continuing, the Special Servicer may be removed, with respect to the Serviced Loans (excluding any Serviced Outside Controlled Loan Combination), in accordance with the procedures set forth below, at the written direction of (a) holders of Certificates (other than Class S and Class R Certificates) evidencing at least 75% of the aggregate Voting Rights of the Certificates (other than Class S and Class R Certificates) or (b) holders of Non-Reduced Certificates evidencing more than 50% of the Voting Rights of each Class of Non-Reduced Certificates (considering each Class of the Class A-S, Class B and Class C Certificates together with the Class PEZ Component with the same alphabetical designation as a single “Class” for such purpose); and
(c) the Special Servicer may be removed and replaced at any time with or without cause solely with respect to a Serviced Outside Controlled Loan Combination at the direction of the related Outside Controlling Note Holder, upon satisfaction of certain conditions specified in the Pooling and Servicing Agreement (including delivery of a Rating Agency Confirmation) and the related Co-Lender Agreement.
The procedures for removing a Special Servicer if a Control Termination Event has occurred and is continuing will be as follows: upon (i) the written direction of holders of Certificates evidencing at least 25% of the Voting Rights of the Certificates (other than Class S and Class R Certificates) requesting a vote to terminate and replace the Special Servicer (with respect to all of the Serviced Loans other than any Serviced Outside Controlled Loan Combination) with a proposed successor Special Servicer, (ii) payment by such holders to the Certificate Administrator of the reasonable fees and expenses to be incurred by the Certificate Administrator in connection
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with administering such vote and (iii) delivery by such holders to the Certificate Administrator and the Trustee of a Rating Agency Confirmation addressing the removal and replacement of the Special Servicer (which confirmations will be obtained at the expense of such holders), the Certificate Administrator will be required to promptly provide written notice to all Certificateholders of such request by posting such notice on its internet website and by mailing at their addresses appearing in the certificate register. Upon the written direction of (a) holders of Certificates (other than the Class S and Class R Certificates) evidencing at least 75% of the Voting Rights of the Certificates (other than the Class S and Class R Certificates) or (b) holders of Non-Reduced Certificates evidencing more than 50% of the Voting Rights of each Class of Non-Reduced Certificates (considering each Class of the Class A-S, Class B and Class C Certificates together with the Class PEZ Component with the same alphabetical designation as a single “Class” for such purpose), the Trustee will be required to terminate all of the rights and obligations of the Special Servicer under the Pooling and Servicing Agreement with respect to the applicable Serviced Loans and appoint the proposed successor Special Servicer;provided that if that written direction is not provided within 180 days of the initial request for a vote to so terminate and replace the Special Servicer, then that written direction will have no force and effect. The Certificate Administrator will include on each Distribution Date statement a statement that each Certificateholder and beneficial owner of Certificates may access such notices on the Certificate Administrator’s website and each Certificateholder and beneficial owner of Certificates may register to receive email notifications when such notices are posted on the website. Any such appointment of a successor Special Servicer with respect to the Serviced Loans (other than any Serviced Outside Controlled Loan Combination) based on a Certificateholder vote will be subject to the receipt of a Rating Agency Confirmation. The Certificate Administrator will be entitled to reimbursement from the requesting Certificateholders for the reasonable expenses of posting notices of such requests.
In addition, any time after the occurrence and during the continuance of a Consultation Termination Event, if the Operating Advisor determines that the Special Servicer is not performing its duties as required under the Pooling and Servicing Agreement or is otherwise not acting in accordance with the Servicing Standard, the Operating Advisor will have the right to recommend the replacement of the Special Servicer with respect to the Serviced Loans;provided, that the Operating Advisor may recommend the replacement of the Special Servicer with respect to a Serviced Outside Controlled Loan Combination only if the related Outside Controlling Note Holder so consents. In any such event, the Operating Advisor will be required to deliver to the Trustee and the Certificate Administrator, with a copy to the Special Servicer, a written recommendation detailing the reasons supporting its position (along with relevant information justifying its recommendation) and recommending a replacement Special Servicer meeting the applicable requirements of the Pooling and Servicing Agreement, which recommended special servicer has agreed to succeed the then-current Special Servicer with respect to the applicable Serviced Loans if appointed in accordance with the Pooling and Servicing Agreement. The Certificate Administrator will be required to promptly post a copy of such recommendation on its internet website and by mail send notice to all Certificateholders, asking them to indicate whether they wish to remove the Special Servicer. Upon the written direction (as evidenced by votes cast) of holders of Non-Reduced Certificates evidencing more than 50% of the Voting Rights of each Class of Non-Reduced Certificates (considering each Class of the Class A-S, Class B and Class C Certificates together with the Class PEZ Component with the same alphabetical designation as a single “Class” for such purpose) within 180 days of the initial request for a vote, and receipt by the Certificate Administrator of a Rating Agency Confirmation from each Rating Agency, the Trustee will terminate all of the rights and obligations of the Special Servicer under the Pooling and Servicing Agreement with respect to the applicable Serviced Loans, and appoint the recommended successor Special Servicer. If such written direction of the holders of the required Non-Reduced Certificates is not provided within 180 days of the request for a vote on the removal of the Special Servicer, the recommendation of the Operating Advisor to so remove and replace the Special Servicer will lapse and be of no force and effect. The reasonable fees and out-of-pocket costs and expenses associated with obtaining the Rating Agency Confirmation described above and administering the vote on removal of the Special Servicer will be an additional expense of the Issuing Entity.
In addition, the Depositor may terminate the Special Servicer upon five business days’ notice if the Special Servicer fails to comply with certain of its reporting obligations under the Pooling and Servicing Agreement.
In no event may a successor Special Servicer be a current or former Operating Advisor or any affiliate of such current or former Operating Advisor.
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Amendment
The Pooling and Servicing Agreement may be amended without the consent of any of the holders of Certificates:
(a) to cure any ambiguity to the extent that it does not adversely affect any holders of Certificates;
(b) to correct or supplement any of its provisions which may be inconsistent with any other provisions of the Pooling and Servicing Agreement or with the description of the provisions in this prospectus supplement or the prospectus, or to correct any error;
(c) to change the timing and/or nature of deposits in the Collection Account, the Excess Liquidation Proceeds Reserve Account, the Exchangeable Distribution Account, the Excess Interest Distribution Account, the Distribution Account or any REO Account;provided that (A) the Master Servicer Remittance Date may in no event be later than the business day prior to the related Distribution Date and (B) the change would not adversely affect in any material respect the interests of any Certificateholder, as evidenced by an opinion of counsel (at the expense of the party requesting the amendment);
(d) to modify, eliminate or add to any of its provisions (i) to the extent necessary to maintain the qualification of either Trust REMIC as a REMIC or the Grantor Trust as a grantor trust or to avoid or minimize the risk of imposition of any tax on the Issuing Entity;provided that the Trustee and the Certificate Administrator have received an opinion of counsel (at the expense of the party requesting the amendment) to the effect that (1) the action is necessary or desirable to maintain such qualification or to avoid or minimize such risk and (2) the action will not adversely affect in any material respect the interests of any holder of the Certificates, (ii) to restrict (or to remove any existing restrictions with respect to) the transfer of the Class R Certificates;provided that the Depositor has determined that the amendment will not give rise to any tax with respect to the transfer of the Class R Certificates to a non-permitted transferee (see “Material Federal Income Tax Consequences—REMICs—Tax and Restrictions on Transfers of REMIC Residual Certificates to Particular Organizations” in the prospectus), or (iii) to the extent necessary to comply with the Investment Company Act of 1940, as amended, the Exchange Act, Regulation AB, and/or any related regulatory actions and/or interpretations;
(e) to make any other provisions with respect to matters or questions arising under the Pooling and Servicing Agreement or any other change;provided that the amendment will not adversely affect in any material respect the interests of any Certificateholder, as evidenced by an opinion of counsel;
(f) to amend or supplement any provision of the Pooling and Servicing Agreement to the extent necessary to maintain the ratings assigned to each Class of Certificates by any Rating Agency;provided that such amendment will not adversely affect in any material respect the interests of any Certificateholder;
(g) to modify the procedures in the Pooling and Servicing Agreement relating to Rule 17g-5 under the Exchange Act (“Rule 17g-5”);provided that such modification does not increase the obligations of the Trustee, the Certificate Administrator, the Operating Advisor, the Master Servicer or the Special Servicer without such party’s consent (which consent may not be withheld unless the modification would materially adversely affect that party or materially increase that party’s obligations under the Pooling and Servicing Agreement);provided, further, that notice of such modification is provided to all parties to the Pooling and Servicing Agreement; and
(h) in the event of a TIA Applicability Determination (as defined below), to modify, eliminate or add to the provisions of the Pooling and Servicing Agreement to the extent necessary to (A) effect the qualification of the Pooling and Servicing Agreement under the TIA or under any similar federal statute hereafter enacted and to add to the Pooling and Servicing Agreement such other provisions as may be expressly required by the TIA, and (B) modify such other provisions of the Pooling and Servicing Agreement to the extent necessary to make those provisions consistent with, and conform to, the modifications made pursuant to clause (A).
Notwithstanding the foregoing, no such amendment to the Pooling and Servicing Agreement contemplated by the first paragraph under this section entitled “—Amendment” will be permitted if the amendment would (i) reduce the consent or consultation rights or the right to receive information under the Pooling and Servicing Agreement of the Controlling Class Representative without the consent of the Controlling Class Representative, (ii) reduce the
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consultation rights or the right to receive information under the Pooling and Servicing Agreement of the Operating Advisor without the consent of the Operating Advisor, (iii) change in any manner the obligations or rights of any Sponsor under the applicable Mortgage Loan Purchase Agreement or the Pooling and Servicing Agreement without the consent of the affected Sponsor, (iv) change in any manner the obligations or rights of any underwriter or initial purchaser of Certificates without the consent of the related underwriter or initial purchaser of Certificates, or (v) adversely affect any Serviced Companion Loan Holder in its capacity as such without its consent.
In a number of cases that have been filed alleging certain violations of the Trust Indenture Act of 1939, as amended (the “TIA”), certain lower courts have held that the TIA was applicable to certain agreements similar to the Pooling and Servicing Agreement and that the mortgage-backed certificates issued pursuant to such agreements were not exempt under Section 304(a)(2) of the TIA. (See for example,Retirement Board of the Policemen’s Annuity and Benefit Fund of the City of Chicago v. The Bank of New York Mellon, 11 Civ. 5459 (WHP) (S.D.N.Y. Apr. 3, 2012),Policemen’s Annuity and Benefit Fund of the City of Chicago v. Bank of America, et.al, 12 Civ. 2865 (KBF) (S.D.N.Y. Dec. 7, 2012) andAmerican Fidelity Assurance Co. v. Bank of New York Mellon, No. Civ-11-1284-D (W.D. Okla. December 26, 2013)). These rulings are contrary to more than three decades of market practice, as well as guidance regarding Section 304(a)(2) of the TIA that had previously been provided by the staff of the Division of Corporation Finance and that, prior to April 24, 2015, had been posted on the SEC’s website as Division of Corporation Finance Interpretive Response 202.01 (“CDI 202.01”). See alsoHarbor Financial, Inc., 1988 SEC No-Act. LEXIS 1463 (Oct. 31, 1988) (in which the SEC staff agreed that certificates evidencing an interest in a pool of mortgage loans could be issued without qualification of the issuing instrument under the TIA). In addition, on December 23, 2014, the United States Court of Appeals for the Second Circuit reversed the lower court’s ruling inRetirement Bd. of the Policemen’s Annuity regarding the applicability of the TIA to trusts governed by pooling and servicing agreements under New York law, holding that the mortgaged-backed securities at issue are exempt under Section 304(a)(2) of the TIA. The plaintiffs/appellants in that case filed a petition for rehearing en banc with the Second Circuit, which was denied on April 13, 2015, and such plaintiffs/appellants have the right to file a petition for writ of certiorari with the Clerk of the United States Supreme Court within 90 days of entry of such judgment. On April 24, 2015, CDI 202.01 was withdrawn by the SEC staff without any indication of the reason for such withdrawal. If theAmerican Fidelity Assurance Company case is affirmed on appeal, there would be a split in the United States circuit courts regarding this issue. In addition, if a petition for writ of certiorari to the United States Supreme Court is timely filed in theRetirement Bd. of the Policemen’s Annuity case or in a subsequent case, and the Supreme Court grants certiorari and reverses the Second Circuit decision, the Pooling and Servicing Agreement may be required to be qualified under the TIA.
In the event that subsequent to the date of this prospectus supplement the Depositor, upon consultation with the Trustee, has determined that the TIA does apply to the Pooling and Servicing Agreement or that that qualification under the TIA or any similar federal statute hereafter enacted is required (a “TIA Applicability Determination”), the Pooling and Servicing Agreement will provide that it will be amended without the consent of any Certificateholder to the extent necessary to comply with the TIA. In addition, if the TIA were to apply to the Pooling and Servicing Agreement, the TIA provides that certain provisions would automatically be deemed to be included in the Pooling and Servicing Agreement (and the Pooling and Servicing Agreement thus would be statutorily amended without any further action);provided, however, that it will be deemed that the parties to the Pooling and Servicing Agreement have agreed that, to the extent permitted under the TIA, the Pooling and Servicing Agreement will expressly exclude any non-mandatory provisions that (x) conflict with the provisions of the Pooling and Servicing Agreement or would otherwise alter the provisions of the Pooling and Servicing Agreement or (y) increase the obligations, liabilities or scope of responsibility of any party to the Pooling and Servicing Agreement. Generally, the TIA provisions include additional obligations of the Trustee, certain additional reporting requirements, and heightened conflict of interest rules which may require, for example, that the Trustee resign in the event the interests of the holders of the various classes of Certificates differ from one another under certain circumstances and that one or more other trustees be appointed in its place. While investors should understand the potential for such amendments, investors should not purchase Certificates with any expectation that the TIA will be determined to apply or that any such amendments will be made.
The Pooling and Servicing Agreement may also be amended by the parties to the Pooling and Servicing Agreement with the consent of the holders of Certificates evidencing not less than 66⅔% of the aggregate Percentage Interests of each Class affected by the amendment for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Pooling and Servicing Agreement or of modifying in any manner the rights of the holders of the Certificates, except that the amendment may not (1) reduce in any manner the amount of, or delay the timing of, payments received on the Serviced Loans which are required to be distributed on a Certificate of any Class without the consent of the holder of that Certificate, or
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that are required to be distributed to a Serviced Companion Loan Holder without its consent, (2) reduce the percentage of Certificates of any Class the holders of which are required to consent to the amendment without the consent of the holders of all Certificates of that Class then outstanding, (3) change in any manner the obligations or rights of any Sponsor under the applicable Mortgage Loan Purchase Agreement or the Pooling and Servicing Agreement without the consent of the related Sponsor, (4) change the definition of “Servicing Standard” without either (a) the consent of 100% of the Certificateholders or (b) a Rating Agency Confirmation, (5) without the consent of 100% of the Certificateholders of the Class or Classes of Certificates adversely affected thereby, change (a) the percentages of Voting Rights of Certificateholders which are required to consent to any action or inaction under the Pooling and Servicing Agreement, (b) the right of the Certificateholders to remove the Special Servicer or (c) the right of the Certificateholders to terminate the Operating Advisor, (6) adversely affect the Controlling Class Representative without the consent of 100% of the Controlling Class Certificateholders, (7) change in any manner the obligations or rights of any underwriter without the consent of the affected underwriter, or (8) adversely affect any Serviced Companion Loan Holder in its capacity as such without its consent.
Notwithstanding the foregoing, the Pooling and Servicing Agreement may not be amended without the Master Servicer, the Special Servicer, the Trustee, the Custodian (if the Trustee is then acting as Custodian) and/or the Certificate Administrator (in each case, only if requested by such party) having first received an opinion of counsel, at the expense of the person requesting the amendment (or, if the amendment is required by any Rating Agency to maintain the rating issued by it or requested by the Trustee or the Certificate Administrator for any purpose described in clause (a) or clause (b) of the first paragraph of this section entitled “—Amendment”, then at the expense of the Issuing Entity), to the effect that the amendment will not result in the imposition of a tax on any portion of the Issuing Entity (other than a tax at the highest marginal corporate tax rate on net income from foreclosure property pursuant to Code Section 860G(c)) or cause either Trust REMIC to fail to qualify as a REMIC or the Grantor Trust to fail to qualify as a grantor trust for federal income tax purposes. The party requesting an amendment to the Pooling and Servicing Agreement will be required to give each Rating Agency prior written notice of such amendment.
Certain amendments to the Pooling and Servicing Agreement may require the delivery of certain opinions of counsel at the expense of the Issuing Entity. In addition, prior to the execution of any amendment to the Pooling and Servicing Agreement, the Trustee, the Custodian (if the Trustee is then acting as Custodian), the Certificate Administrator, the Special Servicer and the Master Servicer may request and will be entitled to rely conclusively upon an opinion of counsel, at the expense of the party requesting such amendment (or, if such amendment is required by any Rating Agency to maintain the rating issued by it or requested by the Trustee or the Certificate Administrator for any purpose described in clause (a), (b), (c) or (e) (which does not modify or otherwise relate solely to the obligations, duties or rights of the Trustee or the Certificate Administrator, as applicable) of the first paragraph of this section entitled “—Amendment”, then at the expense of the Issuing Entity) stating that the execution of such amendment is authorized or permitted by the Pooling and Servicing Agreement, and that all conditions precedent to such amendment are satisfied.
Realization Upon Mortgage Loans
Specially Serviced Loans; Appraisals
Promptly upon the occurrence of an Appraisal Reduction Event with respect to a Serviced Loan, the Special Servicer will be required to use reasonable efforts to obtain an appraisal of the Mortgaged Property or REO Property, as the case may be, from an Appraiser in accordance with MAI standards (an “Updated Appraisal”). However, the Special Servicer will not be required to obtain an Updated Appraisal of any Mortgaged Property with respect to which there exists an appraisal from an Appraiser in accordance with MAI standards which is less than nine months old, unless the Special Servicer determines that such previously obtained Appraisal is materially inaccurate. The cost of any Updated Appraisal will be advanced by, and reimbursable to, the Master Servicer as a Property Advance or will be an expense of the Issuing Entity and paid out of the Collection Account if determined to be a Non-Recoverable Advance to the extent provided in the Pooling and Servicing Agreement.
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Standards for Conduct Generally in Effecting Foreclosure or the Sale of Defaulted Loans
In connection with any foreclosure, enforcement of the related Mortgage Loan documents, or other acquisition, the cost and expenses of any such proceeding will be a Property Advance or an expense of the Issuing Entity and paid out of the Collection Account if determined to be a Non-Recoverable Advance.
If the Special Servicer elects to proceed with a non-judicial foreclosure in accordance with the laws of the state where the Mortgaged Property is located, the Special Servicer will not be required to pursue a deficiency judgment against the related borrower, if available, or any other liable party if the laws of the state do not permit such a deficiency judgment after a non-judicial foreclosure or if the Special Servicer determines, in accordance with the Servicing Standard, that the likely recovery if a deficiency judgment is obtained will not be sufficient to warrant the cost, time, expense and/or exposure of pursuing the deficiency judgment and such determination is evidenced by an officers’ certificate delivered to the Trustee, the Certificate Administrator, any related Outside Controlling Note Holder and (prior to the occurrence and continuance of a Consultation Termination Event) the Controlling Class Representative.
Notwithstanding anything in this prospectus supplement to the contrary, the Pooling and Servicing Agreement will provide that the Special Servicer will not, on behalf of the Issuing Entity or a related Serviced Companion Loan Holder, obtain title to a Mortgaged Property as a result of foreclosure or by deed-in-lieu of foreclosure or otherwise, and will not otherwise acquire possession of, or take any other action with respect to, any Mortgaged Property if, as a result of any such action, the Trustee, the Certificate Administrator, the Issuing Entity or the holders of Certificates or a related Serviced Companion Loan Holder would be considered to hold title to, to be a “mortgagee-in-possession” of, or to be an “owner” or “operator” of, such Mortgaged Property within the meaning of the federal Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, or any comparable law, unless the Special Servicer has previously determined, based on an updated environmental assessment report prepared by an independent person who regularly conducts environmental audits, that: (i) such Mortgaged Property is in compliance with applicable environmental laws or, if not, after consultation with an environmental consultant, that it would be in the best economic interest of the Issuing Entity and, if applicable, a related Serviced Companion Loan Holder (as a collective whole) to take such actions as are necessary to bring such Mortgaged Property in compliance with applicable environmental laws and (ii) there are no circumstances present at such Mortgaged Property relating to the use, management or disposal of any hazardous materials for which investigation, testing, monitoring, containment, clean-up or remediation could be required under any currently effective federal, state or local law or regulation, or that, if any such hazardous materials are present for which such action could be required, after consultation with an environmental consultant it would be in the best economic interest of the Issuing Entity and any related Serviced Companion Loan Holder (as a collective whole as if the Issuing Entity and, if applicable, such Serviced Companion Loan Holder(s) constituted a single lender (and, with respect to a Serviced AB Loan Combination, taking into account the subordinate nature of the related Subordinate Companion Loan)) to take such actions with respect to the affected Mortgaged Property as could be required by such law or regulation. If appropriate, the Special Servicer may establish a single member limited liability company with the Issuing Entity and, if applicable, a related Serviced Companion Loan Holder, as the sole owner to hold title to the Mortgaged Property.
In the event that title to any Mortgaged Property is acquired in foreclosure or by deed-in-lieu of foreclosure, the deed or certificate of sale is required to be issued to the Trustee, to a co-trustee or to its nominee or a separate trustee or co-trustee on behalf of the Trustee, on behalf of holders of Certificates and, if applicable, the related Serviced Companion Loan Holder. Notwithstanding any such acquisition of title and cancellation of the related Serviced Loan, the related Serviced Mortgage Loan will generally be considered to be an REO Mortgage Loan held in the Issuing Entity until such time as the related REO Property is sold by the Issuing Entity.
If title to any Mortgaged Property is acquired by the Issuing Entity (directly or through a single member limited liability company established for that purpose), the Special Servicer will be required to sell the Mortgaged Property prior to the close of the third calendar year beginning after the year of acquisition, unless (1) the IRS grants (or does not deny) an extension of time to sell the property or (2) the Special Servicer, the Certificate Administrator and the Trustee receive an opinion of independent counsel to the effect that the holding of the property by the Lower-Tier REMIC longer than the above-referenced three year period will not result in the imposition of a tax on either Trust REMIC or cause either Trust REMIC to fail to qualify as a REMIC under the Code for federal income tax purposes at any time that any Certificate is outstanding. Subject to the foregoing and any other tax-related limitations, pursuant to the Pooling and Servicing Agreement, the Special Servicer will generally be required to attempt to sell any Mortgaged Property so acquired in accordance with the Servicing
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Standard. The Special Servicer will also be required to ensure that any Mortgaged Property acquired by the Issuing Entity is administered so that it constitutes “foreclosure property” within the meaning of Code Section 860G(a)(8) at all times, and that the sale of the property does not result in the receipt by the Issuing Entity of any income from nonpermitted assets as described in Code Section 860F(a)(2)(B). If the Lower-Tier REMIC acquires title to any Mortgaged Property, the Special Servicer, on behalf of the Lower-Tier REMIC, will retain, at the expense of the Issuing Entity, an independent contractor to manage and operate the property. The independent contractor generally will be permitted to perform construction (including renovation) on a foreclosed property only if the construction was at least 10% completed at the time default on the related Mortgage Loan became imminent. The retention of an independent contractor, however, will not relieve the Special Servicer of its obligation to manage the Mortgaged Property as required under the Pooling and Servicing Agreement.
Generally, neither Trust REMIC will be taxable on income received with respect to a Mortgaged Property acquired by the Issuing Entity to the extent that it constitutes “rents from real property,” within the meaning of Code Section 856(c)(3)(A) and Treasury regulations under the Code. Rents from real property include fixed rents and rents based on the gross receipts or sales of a tenant but do not include the portion of any rental based on the net income or profit of any tenant or sub-tenant. No determination has been made whether rent on any of the Mortgaged Properties meets this requirement. Rents from real property include charges for services customarily furnished or rendered in connection with the rental of real property, whether or not the charges are separately stated. Services furnished to the tenants of a particular building will be considered as customary if, in the geographic market in which the building is located, tenants in buildings which are of similar class are customarily provided with the service. No determination has been made whether the services furnished to the tenants of the Mortgaged Properties are “customary” within the meaning of applicable regulations. It is therefore possible that a portion of the rental income with respect to a Mortgaged Property owned by the Issuing Entity would not constitute rents from real property, or that none of such income would qualify if a separate charge is not stated for such non-customary services or they are not performed by an independent contractor. Rents from real property also do not include income from the operation of a trade or business on the Mortgaged Property, such as a hospitality property or rental income attributable to personal property leased in connection with a lease of real property if the rent attributable to personal property exceeds 15% of the total net rent for the taxable year. Any of the foregoing types of income may instead constitute “net income from foreclosure property,” which would be taxable to the Lower-Tier REMIC, at the highest marginal federal corporate rate and may also be subject to state or local taxes. The Pooling and Servicing Agreement provides that the Special Servicer will be permitted to cause the Lower-Tier REMIC to earn “net income from foreclosure property” that is subject to tax if it determines that the net after-tax benefit to Certificateholders and any related Serviced Companion Loan Holders, as a collective whole, could reasonably be expected to be greater than another method of operating or net leasing the Mortgaged Property. Because these sources of income, if they exist, are already in place with respect to the Mortgaged Properties, it is generally viewed as beneficial to Certificateholders to permit the Issuing Entity to continue to earn them if it acquires a Mortgaged Property, even at the cost of this tax. These taxes would be chargeable against the related income for purposes of determining the proceeds available for distribution to holders of Certificates. See “Material Federal Income Tax Consequences—REMICs—Prohibited Transactions Tax and Other Taxes” in the prospectus.
To the extent that Liquidation Proceeds collected with respect to any Mortgage Loan are less than the sum of (1) the outstanding principal balance of the Mortgage Loan, (2) interest accrued on the Mortgage Loan and (3) the aggregate amount of outstanding reimbursable expenses (including any (i) unpaid servicing compensation, (ii) unreimbursed Property Advances, (iii) accrued and unpaid interest on all Advances and (iv) additional expenses of the Issuing Entity) incurred with respect to the Mortgage Loan, the Issuing Entity will realize a loss in the amount of the shortfall. The Trustee, the Certificate Administrator, the Master Servicer and/or the Special Servicer will be entitled to reimbursement out of the Liquidation Proceeds recovered on any Mortgage Loan or Serviced Loan Combination, prior to the distribution of those Liquidation Proceeds to Certificateholders or Serviced Companion Loan Holders, of any and all amounts that represent unpaid servicing compensation in respect of the related Mortgage Loan or Serviced Loan Combination, certain unreimbursed expenses incurred with respect to the Mortgage Loan or Serviced Loan Combination and any unreimbursed Advances (including interest on Advances) made with respect to the Mortgage Loan or Serviced Loan Combination. In addition, amounts otherwise distributable on the Certificates will be further reduced by interest payable to the Master Servicer, the Special Servicer or Trustee on these Advances.
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Sale of Defaulted Mortgage Loans and REO Properties
Promptly upon a Serviced Loan becoming a Defaulted Mortgage Loan and if the Special Servicer determines in accordance with the Servicing Standard that it would be in the best interests of the Certificateholders and, in the case of a Serviced Pari Passu Loan Combination, any related Serviced Pari Passu Companion Loan Holder (as a collective whole as if such Certificateholders and, in the case of a Serviced Pari PassuLoan Combination, any related Serviced Pari Passu Companion Loan Holder, constituted a single lender) to attempt to sell such Serviced Loan, the Special Servicer will be required to use reasonable efforts to solicit offers for the Defaulted Mortgage Loan on behalf of the Certificateholders and, if applicable, any related Serviced Pari Passu Companion Loan Holder in such manner as will be reasonably likely to realize a fair price. The Special Servicer will generally be required to accept the first (and, if multiple offers are contemporaneously received, the highest) cash offer received from any person that constitutes a fair price for the Defaulted Mortgage Loan. The Special Servicer is required to notify, among others, the Controlling Class Representative (prior to the occurrence and continuance of a Consultation Termination Event), any related Outside Controlling Note Holder and the Operating Advisor (after the occurrence and during the continuance of a Control Termination Event) of any inquiries or offers received regarding the sale of any Defaulted Mortgage Loan.
The Special Servicer will be required to determine whether any cash offer constitutes a fair price for any Defaulted Mortgage Loan if the highest offeror is a person other than an Interested Person. In determining whether any offer from a person other than an Interested Person constitutes a fair price for any Defaulted Mortgage Loan, the Special Servicer will be required to take into account (in addition to the results of any appraisal, updated appraisal or narrative appraisal that it may have obtained pursuant to the Pooling and Servicing Agreement within the prior nine months), and in determining whether any offer from an Interested Person constitutes a fair price for any Defaulted Mortgage Loan, any Appraiser will be instructed to take into account, as applicable, among other factors, the period and amount of any delinquency on the affected Mortgage Loan, the occupancy level and physical condition of the related Mortgaged Property and the state of the local economy.
If the highest offeror is an Interested Person (provided that the Trustee may not be an offeror), then the Trustee will be required to determine whether the cash offer constitutes a fair price. However, no offer from an Interested Person will constitute a fair price unless (i) it is the highest offer received and (ii) at least two other offers are received from independent third parties. In determining whether any offer received from an Interested Person represents a fair price for any such Defaulted Mortgage Loan, the Trustee will be supplied with and will be required to rely on the most recent appraisal or updated appraisal conducted in accordance with the Pooling and Servicing Agreement within the preceding nine month period or, in the absence of any such appraisal, on a new appraisal. Except as provided in the following paragraph, the cost of any appraisal will be covered by, and will be reimbursable as, a Property Advance.
Notwithstanding anything contained in the preceding paragraph to the contrary, if the Trustee is required to determine whether a cash offer by an Interested Person constitutes a fair price, the Trustee may (at its option and at the expense of the Interested Person) designate an independent third party expert in real estate or commercial mortgage loan matters with at least five years’ experience in valuing or investing in loans similar to the subject Serviced Loan that has been selected with reasonable care by the Trustee to determine if such cash offer constitutes a fair price for such Serviced Loan. If the Trustee designates such a third party to make such determination, the Trustee will be entitled to rely conclusively upon such third party’s determination. The reasonable costs of all appraisals, inspection reports and broker opinions of value incurred by any such third party pursuant to this paragraph will be covered by, and will be reimbursable by the Interested Person;provided, that the Trustee will not engage a third party expert whose fees exceed a commercially reasonable amount as determined by the Trustee.
The Repurchase Price will be deemed a fair price in all events.
With respect to any Serviced Pari Passu Loan Combination (other than any such Loan Combination that is a Serviced Outside Controlled Loan Combination), pursuant to the terms of the related Co-Lender Agreement, if such Serviced Pari Passu Loan Combination becomes a Defaulted Mortgage Loan, and if the Special Servicer determines to sell the related Serviced Mortgage Loan in accordance with the discussion in this “—Sale of Defaulted Mortgage Loans and REO Properties” section, then the Special Servicer will be required to sell each related Serviced Pari Passu Companion Loan together with such Serviced Mortgage Loan as a single whole loan in accordance with the terms of the Pooling and Servicing Agreement, and subject to any rights of the related
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Directing Holder and/or the holder of any related Serviced Pari Passu Companion Loan under the Pooling and Servicing Agreement or under the related Co-Lender Agreement. Notwithstanding the foregoing, the Special Servicer will not be permitted to sell any such Serviced Pari Passu Loan Combination if it becomes a Defaulted Mortgage Loan without the written consent of each related Serviced Pari Passu Companion Loan Holder (provided that such consent is not required if the consenting party is the borrower or an affiliate of the borrower) unless the Special Servicer has delivered to such related Serviced Pari Passu Companion Loan Holder: (a) at least 15 business days’ prior written notice of any decision to attempt to sell such Loan Combination; (b) at least ten days prior to the proposed sale date, a copy of each bid package (together with any material amendments to such bid packages) received by the Special Servicer in connection with any such proposed sale; (c) at least ten days prior to the proposed sale date, a copy of the most recent appraisal for the subject Serviced Pari Passu Loan Combination, and any documents in the servicing file reasonably requested by such related Serviced Pari Passu Companion Loan Holder that are material to the price of the subject Serviced Pari Passu Loan Combination; and (d) until the sale is completed, and a reasonable period of time (but no less time than is afforded to other offerors) prior to the proposed sale date, all information and other documents being provided to other offerors and all leases or other documents that are approved by the Master Servicer or the Special Servicer in connection with the proposed sale;provided, that a related Serviced Pari Passu Companion Loan Holder may waive as to itself any of the delivery or timing requirements set forth in this sentence. The Controlling Class Representative and each related Serviced Pari Passu Companion Loan Holder will be permitted to submit an offer at any sale of the subject Serviced Pari Passu Loan Combination unless such person is the borrower or an agent or affiliate of the borrower. See “Description of the Mortgage Pool—The Loan Combinations” above in this prospectus supplement.
With respect to any Serviced Pari Passu Loan Combination that is a Serviced Outside Controlled Loan Combination, pursuant to the terms of the related Co-Lender Agreement, if such Serviced Pari Passu Loan Combination becomes a Defaulted Mortgage Loan, and if the Special Servicer determines to sell the related Serviced Mortgage Loan in accordance with the discussion in this “—Sale of Defaulted Mortgage Loans and REO Properties” section, then the Special Servicer will be required to sell the related Serviced Pari Passu Companion Loan together with such Serviced Mortgage Loan as a single whole loan in accordance with the terms of the Pooling and Servicing Agreement, and subject to any rights of the related Directing Holder, the Controlling Class Representative and/or the holder of any related non-controlling Serviced Pari Passu Companion Loan under the Pooling and Servicing Agreement or under the related Co-Lender Agreement. Notwithstanding the foregoing, the Special Servicer will not be permitted to sell any such Serviced Pari Passu Loan Combination if it becomes a Defaulted Mortgage Loan without the written consent of the Controlling Class Representative (unless a Consultation Termination Event exists), the related Outside Controlling Note Holder and the holder of each related non-controlling Serviced Pari Passu Companion Loan (provided that such consent is not required if the consenting party is the borrower or an affiliate of the borrower) unless the Special Servicer has delivered to the Controlling Class Representative, the related Outside Controlling Note Holder and the holder of each related non-controlling Serviced Pari Passu Companion Loan: (a) at least 15 business days’ prior written notice of any decision to attempt to sell such Serviced Pari Passu Loan Combination; (b) at least ten days prior to the proposed sale date, a copy of each bid package (together with any material amendments to such bid packages) received by the Special Servicer in connection with any such proposed sale; (c) at least ten days prior to the proposed sale date, a copy of the most recent appraisal for the subject Serviced Pari Passu Loan Combination, and any documents in the servicing file reasonably requested by the Controlling Class Representative and the related Outside Controlling Note Holder that are material to the price of the subject Serviced Pari Passu Loan Combination; and (d) until the sale is completed, and a reasonable period of time (but no less time than is afforded to other offerors and the Controlling Class Representative) prior to the proposed sale date, all information and other documents being provided to other offerors and all leases or other documents that are approved by the Master Servicer or the Special Servicer in connection with the proposed sale;provided, that the Controlling Class Representative, the related Outside Controlling Note Holder and the holder of each related non-controlling Serviced Pari Passu Companion Loan may each waive as to itself any of the delivery or timing requirements set forth in this sentence. The Controlling Class Representative, the related Outside Controlling Note Holder and the holder of each related non-controlling Serviced Pari Passu Companion Loan will be permitted to submit an offer at any sale of the subject Serviced Pari Passu Loan Combination unless such person is the borrower or an agent or affiliate of the borrower. See “Description of the Mortgage Pool—The Loan Combinations” above in this prospectus supplement.
With respect to any Serviced AB Loan Combination, pursuant to the terms of the Pooling and Servicing Agreement, if the related Serviced Mortgage Loan becomes a Defaulted Mortgage Loan, and if the Special Servicer determines to sell such Serviced Mortgage Loan in accordance with the discussion in this “—Sale of
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Defaulted Mortgage Loans and REO Properties” section, then the Special Servicer will be permitted to sell the related Serviced Subordinate Companion Loan together with such Serviced Mortgage Loan and any related Serviced Pari Passu Companion Loan as a single whole loan,provided that the Special Servicer has received prior written consent from the holder of such Subordinate Companion Loan.
If an Outside Serviced Mortgage Loan becomes the equivalent of a Defaulted Mortgage Loan and the Outside Special Servicer elects to sell any promissory note evidencing a portion of the related Outside Serviced Loan Combination, the Outside Special Servicer will be required to sell such Outside Serviced Mortgage Loan, together with the related Companion Loan(s), as a single whole loan, pursuant to the Outside Servicing Agreement. See “Description of the Mortgage Pool—The Loan Combinations—The Selig Office Portfolio Loan Combination—Sale of Defaulted Loan Combination”, “—The Loan Combinations—The Dallas Market Center Loan Combination—Sale of Defaulted Loan Combination”, and “—The Loan Combinations—The Crowne Plaza Bloomington Loan Combination—Sale of Defaulted Loan Combination” in this prospectus supplement.
The Special Servicer is required to use reasonable efforts to solicit offers for each REO Property related to a Serviced Mortgage Loan on behalf of the Certificateholders and any related Serviced Companion Loan Holder, if applicable, and to sell each such REO Property in the same manner as with respect to a Defaulted Mortgage Loan.
Notwithstanding any of the foregoing paragraphs, the Special Servicer will not be required to accept the highest cash offer for a Defaulted Mortgage Loan if the Special Servicer determines (in consultation with the Controlling Class Representative (unless a Consultation Termination Event exists or a Serviced Outside Controlled Loan Combination is involved) and any related Outside Controlling Note Holder (if a Serviced Outside Controlled Loan Combination is involved)), in accordance with the Servicing Standard, that rejection of such offer would be in the best interests of the Certificateholders and, in the case of a sale of a Serviced Pari Passu Loan Combination, the related Serviced Pari Passu Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, any related Serviced Pari Passu Companion Loan Holder(s) constituted a single lender), and the Special Servicer may accept a lower cash offer (from any person other than itself or an affiliate) if it determines, in its reasonable and good faith judgment, that acceptance of such offer would be in the best interests of the Certificateholders and, in the case of a Serviced Pari Passu Loan Combination, any related Serviced Pari Passu Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, any related Serviced Pari Passu Companion Loan Holder(s) constituted a single lender).
Notwithstanding any of the foregoing paragraphs, the Special Servicer will not be required to accept the highest cash offer for an REO Property if the Special Servicer determines (in consultation with the related Directing Holder (unless, if the Controlling Class Representative is the related Directing Holder, a Consultation Termination Event exists)), in accordance with the Servicing Standard, that rejection of such offer would be in the best interests of the Certificateholders and, in the case of a sale of an REO Property related to a Serviced Loan Combination, the related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, any related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of the related Serviced Subordinate Companion Loan)), and the Special Servicer may accept a lower cash offer (from any person other than itself or an affiliate) if it determines, in its reasonable and good faith judgment, that acceptance of such offer would be in the best interests of the Certificateholders and, in the case of an REO Property related to a Serviced Loan Combination, any related Serviced Companion Loan Holder(s) (as a collective whole as if such Certificateholders and, if applicable, any related Serviced Companion Loan Holder(s) constituted a single lender (and, in the case of a Serviced AB Loan Combination, taking into account the subordinate nature of the related Serviced Subordinate Companion Loan)).
An “Interested Person” is the Depositor, the Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator, the Trustee, the Controlling Class Representative, any Sponsor, any borrower, any holder of a related mezzanine loan, any manager of a Mortgaged Property, any independent contractor engaged by the Special Servicer or any affiliate of any of the preceding entities, and, with respect to a Defaulted Mortgage Loan that constitutes a Serviced Loan Combination, the depositor, the master servicer, the special servicer (or any independent contractor engaged by such special servicer), or the trustee for the securitization of the related Serviced Companion Loan, the related Serviced Companion Loan Holder or its representative, any holder of a related mezzanine loan, or any known affiliate of any such party described above.
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Modifications, Waivers and Amendments
The Pooling and Servicing Agreement will permit (a) with respect to any Serviced Loan that is a non-Specially Serviced Loan, the Master Servicer (subject to the Special Servicer’s consent except as provided below), or (b) with respect to any Specially Serviced Loan, the Special Servicer, in each case subject to the consultation rights of the Operating Advisor and the consent and/or consultation rights of the related Directing Holder (if any) and, to the extent required in accordance with the related Co-Lender Agreement, any related Serviced Companion Loan Holder or its representative, to modify, waive or amend any term of any Serviced Loan if such modification, waiver or amendment (i) is consistent with the Servicing Standard and (ii) would not constitute a “significant modification” of such Serviced Loan pursuant to Treasury Regulations Section 1.860G-2(b) and would not otherwise (A) cause either Trust REMIC to fail to qualify as a REMIC or cause the Grantor Trust to fail to qualify as a grantor trust or (B) result in the imposition of a tax upon either Trust REMIC or the Issuing Entity (including but not limited to the tax on “prohibited transactions” as defined in Code Section 860F(a)(2) and the tax on contributions to a REMIC set forth in Code Section 860G(d), but not including the tax on “net income from foreclosure property” under Code Section 860G(c)).
In connection with (i) the release of a Mortgaged Property or any portion of a Mortgaged Property from the lien of the related Mortgage, or (ii) the taking of a Mortgaged Property or any portion of a Mortgaged Property by exercise of the power of eminent domain or condemnation, if the related Serviced Mortgage Loan documents require the Master Servicer or the Special Servicer, as applicable, to calculate (or require the related borrower to provide such calculation to the Master Servicer or the Special Servicer, as applicable) the loan-to-value ratio of the remaining Mortgaged Property or Mortgaged Properties or the fair market value of the real property constituting the remaining Mortgaged Property or Mortgaged Properties, for purposes of REMIC qualification of the related Serviced Mortgage Loan, then, unless then permitted by the REMIC provisions of the Code, such calculation shall exclude the value of personal property and going concern value, if any.
No modification, waiver or amendment of any Co-Lender Agreement related to a Serviced Loan or an action to enforce rights with respect thereto, in each case, in a manner that materially and adversely affects the rights, duties and obligations of the Special Servicer will be permitted without the prior written consent of the Special Servicer.
The consent of the Special Servicer is required to any modification, waiver or amendment with regard to any Serviced Loan that is not a Specially Serviced Loan (other than certain non-material modifications, waivers or amendments), and the Special Servicer will also be required to obtain the consent of the related Directing Holder to the extent described below under “—Directing Holder” in this prospectus supplement. The Special Servicer is also required to obtain the consent of the related Directing Holder in connection with any modification, waiver or amendment with regard to any Specially Serviced Loan to the extent described below under “—Directing Holder” in this prospectus supplement.
When the Special Servicer’s consent is required, the Master Servicer shall promptly provide the Special Servicer with written notice of any request for modification, waiver or amendment accompanied by the Master Servicer’s written recommendation and analysis and any and all information in the Master Servicer’s possession or reasonably available to it that the Special Servicer or the related Directing Holder may reasonably request to grant or withhold such consent. When the Special Servicer’s consent is required under the Pooling and Servicing Agreement, such consent will be deemed given if the Special Servicer does not respond to a request for consent within the time periods set forth in the Pooling and Servicing Agreement. With respect to all applicable Specially Serviced Loan(s) and non-Specially Serviced Loan(s), the Special Servicer will be required to obtain, prior to consenting to such a proposed action of the Master Servicer that constitutes a Major Decision, and prior to itself taking any such action that constitutes a Major Decision, the written consent of the related Controlling Note Holder (to the extent set forth in the related Co-Lender Agreement if a Serviced Outside Controlled Loan Combination is involved) or the Controlling Class Representative (if any other Serviced Loan(s) are involved and a Control Termination Event does not exist), as applicable, which consent will be deemed given if such related Directing Holder does not respond to a request for consent within the time periods set forth in the Pooling and Servicing Agreement.
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With respect to all non-Specially Serviced Loans, and subject to the rights of the Special Servicer and the related Directing Holder (as described below under “—Directing Holder” in this prospectus supplement), the Master Servicer, without the consent of the Special Servicer, will be responsible to determine whether to consent to or approve any request by a borrower with respect to:
(A) approving routine leasing activity with respect to any lease for less than the lesser of (i) 30,000 square feet and (ii) 30% of the net rentable area of the related Mortgaged Property;
(B) approving any waiver affecting the timing of receipt of financial statements from any borrower; provided that such financial statements are delivered no less often than quarterly and within 60 days after the end of the calendar quarter;
(C) approving annual budgets for the related Mortgaged Property; provided that no such budget (i) provides for the payment of operating expenses in an amount equal to more than 110% of the amounts budgeted therefor for the prior year or (ii) provides for the payment of any material expenses to any affiliate of the borrower (other than the payment of a management fee to any property manager if such management fee is no more than the management fee in effect on the Cut-off Date);
(D) subject to other restrictions in this prospectus supplement regarding principal prepayments, waiving any provision of a Serviced Loan requiring a specified number of days’ notice prior to a principal prepayment;
(E) approving non-material modifications, consents or waivers (other than modifications, consents or waivers specifically prohibited under this “—Modifications, Waivers and Amendments” section) in connection with a defeasance permitted by the terms of the Pooling and Servicing Agreement, and subject to certain conditions, including in certain cases, delivery of an opinion of counsel (which opinion of counsel will be an expense of the borrower) to the effect that such modification, waiver or consent would not cause any Trust REMIC to fail to qualify as a REMIC under the Code or result in a “prohibited transaction” under the REMIC provisions of the Code or cause the Grantor Trust to fail to qualify as a grantor trust for federal income tax purposes;
(F) approving consents with respect to non-material rights-of-way and non-material easements and consent to subordination of the related Serviced Mortgage Loan or Serviced Loan Combination to such non-material rights-of-way or easements; provided, that the Master Servicer has determined in accordance with the Servicing Standard that such right-of-way or easement does not materially interfere with the then-current use of the related Mortgaged Property or the security intended to be provided by the related Mortgage and will not have a material adverse effect on the value of such Mortgaged Property;
(G) granting waivers of minor covenant defaults (other than financial covenants);
(H) as permitted under the Serviced Loan documents, payment from any escrow or reserve, except releases of any escrows, reserve accounts or letters of credit held as performance escrows or reserves unless required pursuant to the specific terms of the related Serviced Loan and for which there is no material lender discretion;
(I) approving a change of the property manager at the request of the related borrower so long as (i) the successor property manager is not affiliated with the borrower and is a nationally or regionally recognized manager of similar properties, and (ii) the subject Serviced Mortgage Loan does not have an outstanding principal balance in excess of the lesser of $5,000,000 or 2% of the then aggregate principal balance of the Mortgage Loans;
(J) subject to the satisfaction of any conditions precedent set forth in the related Serviced Loan documents, approving disbursements of any holdback amounts in accordance with the related Mortgage Loan documents with respect to certain Serviced Loans other than those Serviced Loans identified in the Pooling and Servicing Agreement; and
(K) any non-material modifications, waivers or amendments not provided for in clauses (A) through (J) above, which are necessary to cure any ambiguities or to correct scrivener’s errors in the terms of the related Serviced Loan.
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In no event, however, will the Special Servicer be permitted to (i) extend the maturity date of a Serviced Loan beyond a date that is three years prior to the Rated Final Distribution Date, or (ii) if the Serviced Loan is secured by a ground lease, extend the maturity date of such Serviced Loan beyond a date which is 20 years or, to the extent consistent with the Servicing Standard, giving due consideration to the remaining term of the ground lease, ten years, prior to the end of the current term of the ground lease, plus any options to extend exercisable unilaterally by the borrower.
Any modification, waiver or amendment with respect to a Serviced Loan Combination may be subject to the consent and/or consultation rights of the related Serviced Companion Loan Holder as described under “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement.
The Master Servicer or the Special Servicer, as applicable, is required to notify the Trustee, the Certificate Administrator, the Depositor, any related Serviced Companion Loan Holder, any related Outside Controlling Note Holder, the Controlling Class Representative (prior to the occurrence and continuance of a Consultation Termination Event), the Operating Advisor (after the occurrence and during the continuance of a Control Termination Event) and the 17g-5 information provider, in writing, of any modification, waiver or amendment of any term of any Serviced Loan and the date of the modification and deliver a copy to the Trustee, any related Serviced Companion Loan Holder, any related Outside Controlling Note Holder, the Controlling Class Representative (prior to the occurrence and continuance of a Consultation Termination Event) and the Operating Advisor (after the occurrence and during the continuance of a Control Termination Event), and the original to the Trustee or other custodian under the Pooling and Servicing Agreement (the “Custodian”) of the recorded agreement relating to such modification, waiver or amendment within 15 business days following the execution and recordation of the modification, waiver or amendment.
Any Modification Fees paid by any borrower to the Master Servicer or the Special Servicer with respect to a modification, consent, extension, waiver or amendment of any term of a Serviced Loan (in the case of a Serviced Loan Combination, if applicable, subject to any related Co-Lender Agreement) will be applied as described under “The Pooling and Servicing Agreement—Application of Penalty Charges and Modification Fees” in this prospectus supplement.
The Master Servicer and the Special Servicer, as applicable, will be required, no less often than on a monthly basis, to make a knowledgeable servicing officer available via telephone to verbally answer questions from any related Serviced Companion Loan Holder, the Operating Advisor (after the occurrence and during the continuance of a Control Termination Event) and the Controlling Class Representative (prior to the occurrence and continuance of a Consultation Termination Event) regarding the performance and servicing of the applicable Serviced Mortgage Loans and/or REO Properties for which such Master Servicer or Special Servicer, as applicable, is responsible.
With respect to an Outside Serviced Mortgage Loan, any modifications, waivers and amendments will be effected by the Outside Special Servicer or the Outside Servicer, as applicable, in accordance with the terms of the Outside Servicing Agreement and the related Co-Lender Agreement. See “Description of the Mortgage Pool—The Loan Combinations” and “—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement. Any consent rights entitled to be exercised by the holder of such Outside Serviced Mortgage Loan with respect to modifications, waivers and amendments or certain other major decisions under the Outside Servicing Agreement, will be exercised by the Master Servicer or Special Servicer, depending on whether that Outside Serviced Mortgage Loan is then being specially serviced and depending on whether the matter would be a Major Decision, with, in the case of a matter that would be a Major Decision, the consent of the Controlling Class Representative unless a Control Termination Event exists. Any consultation rights entitled to be exercised by the holder of such Outside Serviced Mortgage Loan will be exercised by the Controlling Class Representative (unless a Consultation Termination Event exists).
Directing Holder
General
The related Outside Controlling Note Holder (if a Serviced Outside Controlled Loan Combination is involved) or the Controlling Class Representative (if any other Serviced Loan(s) are involved and a Control Termination Event does not exist), as applicable, will be entitled to advise (1) the Special Servicer, with respect to the applicable Serviced Loan(s) that are Specially Serviced Loan(s) and (2) the Special Servicer, with respect to the
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applicable Serviced Loan(s) that are not Specially Serviced Loan(s), as to all matters for which the Master Servicer must obtain the consent or deemed consent of the Special Servicer, in each case as described below.
The provisions summarized below with respect to the Controlling Class Representative will be subject to the right of certain Controlling Class Certificateholders to “opt-out” of its Controlling Class Certificateholder rights under certain circumstances described in this prospectus supplement, as provided for in the Pooling and Servicing Agreement.
Except as otherwise described in the succeeding paragraphs below, (a) the Master Servicer will not be permitted to take any of the following actions unless it has obtained the consent of the Special Servicer and (b) the Special Servicer will not be permitted to consent to the Master Servicer’s taking any of the following actions, nor will the Special Servicer itself be permitted to take any of the following actions, as to which the related Directing Holder has objected in writing within 10 business days (or in the case of a determination of an Acceptable Insurance Default, 20 days) after receipt of the written recommendation and analysis from the Special Servicer (provided that if such written objection has not been received by the Special Servicer within the 10-day or, if applicable, 20-day period, the related Directing Holder will be deemed to have approved such action) (each of the following, a “Major Decision”):
(A) any proposed or actual foreclosure upon or comparable conversion (which may include acquisitions of an REO Property) of the ownership of properties securing such of the Serviced Loans as come into and continue in default;
(B) any modification, consent to a modification or waiver of any monetary term (other than Penalty Charges which the Master Servicer or the Special Servicer, as applicable, is permitted to waive pursuant to the Pooling and Servicing Agreement) or material non-monetary term (including, without limitation, a modification with respect to the timing of payments and acceptance of discounted payoffs but excluding waiver of Penalty Charges) of a Serviced Loan or any extension of the maturity date or Anticipated Repayment Date, as applicable, of such Serviced Loan;
(C) any sale of a Serviced Mortgage Loan that is a Defaulted Mortgage Loan (and any related Serviced Pari Passu Companion Loan) or an REO Property (other than in connection with (i) the termination of the Issuing Entity as described under “The Pooling and Servicing Agreement—Optional Termination; Optional Mortgage Loan Purchase” and (ii) the repurchase of, or substitution for, any Mortgage Loan by the applicable Sponsor for a Material Document Defect or Material Breach, as applicable, as described under “Description of the Mortgage Pool—Cures, Repurchases and Substitutions”in this prospectus supplement) for less than the applicable Repurchase Price;
(D) any determination to bring an REO Property into compliance with applicable environmental laws or to otherwise address hazardous material located at an REO Property;
(E) any release of collateral or any acceptance of substitute or additional collateral for a Serviced Loan or any consent to either of the foregoing, other than immaterial condemnation actions and other similar takings, or if otherwise required pursuant to the specific terms of the related Serviced Loan and for which there is no lender discretion;
(F) any waiver of a “due-on-sale” or “due-on-encumbrance” clause with respect to a Mortgage Loan or, if lender consent is required, any consent to such a waiver or consent to a transfer of the Mortgaged Property or interests in the borrower or consent to the incurrence of additional debt, other than any such transfer or incurrence of debt as may be effected without the consent of the lender under the related loan agreement or related to an immaterial easement, right of way or similar agreement;
(G) any property management company changes (with respect to a Mortgage Loan with a Stated Principal Balance greater than $5 million) or franchise changes, in each case to the extent the lender is required to consent or approve under the related Serviced Loan documents;
(H) releases of any escrow accounts, reserve accounts or letters of credit held as performance or “earn-out” escrows or reserves, other than those required pursuant to the specific terms of the related Serviced Loan and for which there is no lender discretion;
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(I) any acceptance of an assumption agreement or any other agreement permitting transfers of interests in a borrower or guarantor releasing a borrower or guarantor from liability under a Serviced Loan other than pursuant to the specific terms of such Serviced Loan and for which there is no lender discretion;
(J) the determination of the Special Servicer pursuant to clause (b) or clause (g) of the definition of “Servicing Transfer Event”;
(K) following a default or an event of default with respect to a Serviced Loan, any acceleration of a Serviced Loan, or initiation of judicial, bankruptcy or similar proceedings under the related Serviced Loan documents or with respect to the related borrower or Mortgaged Property;
(L) any modification, waiver or amendment of an intercreditor agreement, Co-Lender Agreement or similar agreement with any mezzanine lender or subordinate debt holder related to a Serviced Loan, or an action to enforce rights with respect thereto;
(M) any determination of an Acceptable Insurance Default;
(N) any proposed modification or waiver of any material provision in the related Mortgage Loan documents governing the type, nature or amount of insurance coverage required to be obtained and maintained by the related borrower; and
(O) any approval of any casualty insurance settlements or condemnation settlements, and any determination to apply casualty proceeds or condemnation awards to the reduction of the debt rather than to the restoration of the Mortgaged Property;
provided,however, that in the event that the Master Servicer or the Special Servicer determines that immediate action is necessary to protect the interests of the Certificateholders (and, with respect to any Serviced Loan Combination, the Serviced Companion Loan Holder(s)) (as a collective whole as if such Certificateholders and, if applicable, the Serviced Companion Loan Holder(s) constituted a single lender (and, with respect to a Serviced AB Loan Combination, taking into account the subordinate nature of the related Subordinate Companion Loan)), the Master Servicer or the Special Servicer, as the case may be, may take any such action without waiting for the Directing Holder’s (or, if applicable, the Special Servicer’s) response. For the avoidance of doubt, any modification, waiver, consent or amendment by the Master Servicer or the Special Servicer that is set forth above as a Major Decision will constitute a Major Decision regardless of the fact that such action is being taken in connection with a defeasance.
Notwithstanding the foregoing, if the Controlling Class Representative is the related Directing Holder, the Special Servicer is not required to obtain the consent of the Controlling Class Representative for any Major Decision following the occurrence and during the continuance of a Control Termination Event;provided, however, that after the occurrence and during the continuance of a Control Termination Event, the Special Servicer will be required to consult with the Controlling Class Representative (until the occurrence and continuance of a Consultation Termination Event) and the Operating Advisor in connection with any Major Decision and to consider alternative actions recommended by the Controlling Class Representative and the Operating Advisor, but only to the extent that consultation with, or consent of, the Controlling Class Representative would have been required prior to the occurrence and continuance of such Control Termination Event;provided that such consultation is not binding on the Special Servicer.
In addition, each of (x) the Controlling Class Representative (with respect to each Serviced Loan other than a Serviced Outside Controlled Loan Combination and provided that a Control Termination Event does not exist) and (y) the related Outside Controlling Note Holder (with respect to a Serviced Outside Controlled Loan Combination) may direct the Special Servicer to take, or to refrain from taking, such other actions with respect to any Serviced Loan, as such party may reasonably deem advisable. Notwithstanding the foregoing, neither the Master Servicer nor the Special Servicer will be required to take or refrain from taking any action pursuant to instructions or objections from any such party that would cause it to violate applicable law, the related Serviced Loan documents, any related Co-Lender Agreement or intercreditor agreement, the Pooling and Servicing Agreement, including the Servicing Standard, or the REMIC provisions of the Code.
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The “Directing Holder” will be: (a) with respect to all of the Serviced Loans other than a Serviced Outside Controlled Loan Combination, the Controlling Class Representative; and (b) with respect to any Serviced Outside Controlled Loan Combination, the related Outside Controlling Note Holder.
The “Controlling Class Representative” is the Controlling Class Certificateholder (or other representative) selected by at least a majority of the Controlling Class Certificateholders, by Certificate Principal Amount, as identified by notice to the Certificate Registrar by the applicable Controlling Class Certificateholders from time to time, with notice of such selection delivered to the Special Servicer, the Master Servicer, the Operating Advisor, the Trustee and the Certificate Administrator;provided, however, that (i) absent that selection, or (ii) until a Controlling Class Representative is so selected or (iii) upon receipt of a notice from the Controlling Class Certificateholders that own Certificates representing more than 50% of the Certificate Principal Amount of the Controlling Class, that a Controlling Class Representative is no longer designated, the Controlling Class Representative will be the Controlling Class Certificateholder that owns the largest aggregate Certificate Principal Amount of the Controlling Class, as identified to the Certificate Registrar pursuant to the procedures set forth in the Pooling and Servicing Agreement;provided, however, that, in the case of the preceding proviso, in the event two or more holders (collectively, the “Subject Holders”) each owns Certificates representing the same aggregate Certificate Principal Amount of the Controlling Class that is, in each case, larger than the aggregate Certificate Principal Amount of the Controlling Class owned by any other particular holder besides the Subject Holders, then the Controlling Class Representative will be the Subject Holders acting unanimously (and for the avoidance of doubt, if both or all of the holders do not act unanimously in accordance with the preceding proviso, any direction and/or consent received will not apply and the deemed consent provisions in the Pooling and Servicing Agreement will be applicable). The initial Controlling Class Representative is expected to be Torchlight Investors, LLC, on behalf of one or more managed funds or accounts.
Once a Controlling Class Representative has been selected, each of the Master Servicer, the Special Servicer, the Operating Advisor, the Depositor, the Certificate Administrator, the Trustee and each other Certificateholder (or beneficial owner of Certificates, if applicable) will be entitled to rely on such selection unless a majority of the Certificateholders of the Controlling Class, by Certificate Principal Amount, or such Controlling Class Representative has notified the Certificate Administrator, the Master Servicer and each other Certificateholder of the Controlling Class, in writing, of the resignation of such Controlling Class Representative or the selection of a new Controlling Class Representative. Upon receipt of written notice of, or other knowledge of, the resignation of a Controlling Class Representative, the Certificate Administrator will be required to request the Certificateholders of the Controlling Class to select a new Controlling Class Representative. Upon receipt of notice of a change in Controlling Class Representative, the Certificate Administrator will be required to promptly forward notice thereof to each other party to the Pooling and Servicing Agreement.
A “Controlling Class Certificateholder” is each holder (or beneficial owner, if applicable) of a Certificate of the Controlling Class as determined by the Certificate Administrator from time to time.
The “Controlling Class” will be as of any time of determination the most subordinate class of Control Eligible Certificates then outstanding that has an aggregate Certificate Principal Amount, as notionally reduced by any Appraisal Reduction Amounts allocable to such Class, at least equal to 25% of the initial Certificate Principal Amount of that Class or, if no Class of Control Eligible Certificates meets the preceding requirement, the Class F Certificates;provided,however, that (at any time that the aggregate Certificate Principal Amount of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB, Class D and Class E Certificates and the Class A-S, Class B and Class C Trust Components has been reduced to zero without regard to the allocation of Appraisal Reduction Amounts) (a) in the case of any Class of Control Eligible Certificates to which the designation of “Controlling Class” would otherwise shift by operation of this definition, where the Certificate Principal Amount of such Class of Control Eligible Certificates has been reduced to zero (without regard to the allocation of Appraisal Reduction Amounts) prior to such shift, then designation of “Controlling Class” shall not shift and shall remain with the Class of Control Eligible Certificates currently designated as the Controlling Class, and (b) in the case of any Class of Control Eligible Certificates which is then designated the “Controlling Class”, if the Certificate Principal Amount of such Class of Control Eligible Certificates is reduced to zero (without regard to the allocation of Appraisal Reduction Amounts), then the designation of “Controlling Class” shall shift to the Class of Control Eligible Certificates that is the most subordinate and that also has a remaining Certificate Principal Amount. The Controlling Class as of the Closing Date will be the Class H Certificates.
The “Control Eligible Certificates” will be any of the Class F, Class G and Class H Certificates.
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A “Control Termination Event” will either (a) occur when none of the Classes of Class F, Class G and Class H Certificates has an outstanding Certificate Principal Amount (as notionally reduced by any Appraisal Reduction Amounts then allocable to such Class) that is at least equal to 25% of the initial Certificate Principal Amount of that Class of Certificates or (b) be deemed to occur as described below;provided,however, that a Control Termination Event will in no event exist at any time that the aggregate Certificate Principal Amount of each Class of Certificates (other than the Control Eligible Certificates) (without regard to the allocation of Appraisal Reduction Amounts) has been reduced to zero.
A “Consultation Termination Event” will either (a) occur when none of the Classes of Class F, Class G and Class H Certificates has an outstanding Certificate Principal Amount, without regard to the allocation of any Appraisal Reduction Amounts, that is equal to or greater than 25% of the initial Certificate Principal Amount of that Class of Certificates or (b) be deemed to occur as described below;provided,however, that a Consultation Termination Event will in no event exist at any time that the aggregate Certificate Principal Amount of each Class of Certificates (other than the Control Eligible Certificates) (without regard to the allocation of Appraisal Reduction Amounts) has been reduced to zero.
After the occurrence and during the continuance of a Control Termination Event, the consent rights of the Controlling Class Representative will terminate, and the Controlling Class Representative will retain consultation rights under the Pooling and Servicing Agreement with respect to certain Major Decisions and other matters with respect to the applicable Serviced Loan(s);provided,however, that the Controlling Class Representative will not be permitted to consult with respect to any Serviced AB Loan Combination while any related Subordinate Companion Loan Holder is the related Outside Controlling Note Holder.
In addition, unless a Consultation Termination Event exists, the Controlling Class Representative will have non-binding consultation rights with respect to (i) certain Major Decisions and other matters relating to any Serviced Outside Controlled Loan Combination and (ii) certain servicing decisions and other matters relating to any Outside Serviced Loan Combination, in each case if and to the extent that the holder of the related Split Mortgage Loan is granted consultation rights under the related Co-Lender Agreement.
After the occurrence and during the continuance of a Consultation Termination Event, the Controlling Class Representative will have no consultation or consent rights under the Pooling and Servicing Agreement and will have no right to receive any notices, reports or information (other than notices, reports or information required to be delivered to all Certificateholders) or any other rights as a Directing Holder. However, the Controlling Class Certificateholder will maintain the right to exercise its Voting Rights for the same purposes as any other Certificateholder under the Pooling and Servicing Agreement.
If, with respect to any Serviced Outside Controlled Loan Combination, the related controlling note is included in a separate securitization trust, the pooling and servicing agreement, trust and servicing agreement or comparable agreement for the relevant securitization may impose limitations on the exercise of rights associated with that related controlling note. For example, any “controlling class representative” (or equivalent entity) for such other securitization may lose consent and consultation rights in a manner similar to that described in the prior three paragraphs with respect to the Controlling Class Representative.
Neither the Master Servicer nor the Special Servicer will be required to take or to refrain from taking any action pursuant to instructions from a Directing Holder, or due to any failure to approve an action by any such party, or due to an objection by any such party that would cause either the Master Servicer or the Special Servicer to violate applicable law, the related Mortgage Loan documents, the Pooling and Servicing Agreement (including the Servicing Standard), any related Co-Lender Agreement or intercreditor agreement or the REMIC provisions of the Code.
The Controlling Class Representative or an Outside Controlling Note Holder, as applicable, has certain rights to remove and replace the Special Servicer with respect to the related Serviced Loan(s) as described under “The Pooling and Servicing Agreement—Termination of the Special Servicer” in this prospectus supplement.
Each Certificateholder and beneficial owner of a Control Eligible Certificate is hereby deemed to have agreed by virtue of its purchase of such Certificate (or beneficial ownership interest in such Certificate) to provide its name and address to the Certificate Administrator and to notify the Certificate Administrator of the transfer of any Control Eligible Certificate (or the beneficial ownership of any Control Eligible Certificate), the selection of the Controlling Class Representative or the resignation or removal of the Controlling Class Representative. Any such
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Certificateholder (or beneficial owner) or its designee at any time appointed Controlling Class Representative is hereby deemed to have agreed by virtue of its purchase of a Control Eligible Certificate (or the beneficial ownership interest in a Control Eligible Certificate) to notify the Certificate Administrator when such Certificateholder (or beneficial owner) or designee is appointed Controlling Class Representative and when it is removed or resigns. Upon receipt of such notice, the Certificate Administrator will be required to notify the Special Servicer, the Master Servicer, the Operating Advisor and the Trustee of the identity of the Controlling Class Representative, any resignation or removal of the Controlling Class Representative and/or any new holder or beneficial owner of a Control Eligible Certificate. In addition, upon the request of the Master Servicer, the Special Servicer, the Operating Advisor or the Trustee, as applicable, the Certificate Administrator will be required to provide the identity of the then-current Controlling Class and a list of the Certificateholders (or beneficial owners, if applicable, at the expense of the Issuing Entity if such expense arises in connection with an event as to which the Controlling Class Representative or the Controlling Class has consent or consultation rights pursuant to the Pooling and Servicing Agreement or in connection with a request made by the Operating Advisor in connection with its obligation under the Pooling and Servicing Agreement to deliver a copy of the Operating Advisor’s annual report to the Controlling Class Representative, and otherwise at the expense of the requesting party) of the Controlling Class to such requesting party, and each of the Master Servicer, Special Servicer, Operating Advisor and the Trustee shall be entitled to rely on such the information so provided by the Certificate Administrator.
In the event of a change in the Controlling Class, the Certificate Administrator will be required to promptly contact the current holder of the Controlling Class (or its designee) or one of its affiliates, or, if applicable, any successor Controlling Class Representative or Controlling Class Certificateholder(s), and determine whether such entity is the holder (or beneficial owner) of at least a majority of the Controlling Class (in effect after such change in Controlling Class) by Certificate Principal Amount. If at any time that the current holder of the Controlling Class (or its designee) or one of its affiliates, or any successor Controlling Class Representative or Controlling Class Certificateholder(s) is no longer the holder (or beneficial owner) of at least a majority of the Controlling Class by Certificate Principal Amount and the Certificate Administrator has neither (i) received notice of the then-current Controlling Class Certificateholders of at least a majority of the Controlling Class by Certificate Principal Amount nor (ii) received notice of a replacement Controlling Class Representative pursuant to the Pooling and Servicing Agreement, then a Control Termination Event and a Consultation Termination Event will be deemed to have occurred and will be deemed to continue until such time as the Certificate Administrator receives either such notice.
Notwithstanding anything to the contrary described in this prospectus supplement, at any time when the Class F Certificates are the Controlling Class Certificates, the holder of more than 50% of the Controlling Class Certificates (by Certificate Principal Amount) may waive its right to act as or appoint a Controlling Class Representative and to exercise any of the rights of the Controlling Class Representative or cause the exercise of any of the rights of the Controlling Class Representative set forth in the Pooling and Servicing Agreement, by irrevocable written notice delivered to the Depositor, Certificate Administrator, Trustee, Master Servicer, Special Servicer and Operating Advisor. Any such waiver will remain effective with respect to such holder and the Class F Certificates until such time as either (x) the Class F Certificates are no longer the Controlling Class of Certificates or (y) that Certificateholder has (i) sold a majority of the Class F Certificates (by Certificate Principal Amount) to an unaffiliated third party and (ii) certified to the Depositor, Certificate Administrator, Trustee, Master Servicer, Special Servicer and Operating Advisor that (a) the transferor retains no direct or indirect voting rights with respect to the Class F Certificates that it does not own, (b) there is no voting agreement between the transferee and the transferor and (c) the transferor retains no direct or indirect economic interest in the Class F Certificates. Following any such transfer, or if the Class F Certificates are no longer the Controlling Class of Certificates, the successor holder of more than 50% of the Controlling Class of Certificates (by Certificate Principal Amount) will again have the rights of a Controlling Class Representative as described in this prospectus supplement without regard to any prior waiver by the predecessor Certificateholder. The successor Certificateholder will also have the right to irrevocably waive its right to act as or appoint a Controlling Class Representative or to exercise any of the rights of the Controlling Class Representative or cause the exercise of any of the rights of the Controlling Class Representative. No successor Certificateholder described above will have any consent rights with respect to any Serviced Mortgage Loan that became a Specially Serviced Loan prior to its acquisition of a majority of the Class F Certificates that had not also become a Corrected Loan prior to such acquisition until such Serviced Mortgage Loan becomes a Corrected Loan.
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Whenever such an “opt-out” by a Controlling Class Certificateholder is in effect:
· | a Control Termination Event and a Consultation Termination Event will be deemed to have occurred and be continuing; and |
· | the rights of the holder of more than 50% of the Class F Certificates (by Certificate Principal Amount), if the Class F Certificates are the Controlling Class of Certificates, to act as or appoint a Controlling Class Representative and the rights of a Controlling Class Representative will not be operative (notwithstanding whether a Control Termination Event or a Consultation Termination Event is or would otherwise then be in effect). |
With respect to an Outside Serviced Mortgage Loan, any consent or approvals on actions to be taken by the Outside Special Servicer or the Outside Servicer are governed by the terms of the Outside Servicing Agreement and the related Co-Lender Agreement, as described under “Description of the Mortgage Pool—The Loan Combinations” and “—Servicing of the Outside Serviced Mortgage Loans” in this prospectus supplement.
Limitation on Liability of the Directing Holder
The Directing Holder will not be liable to the Issuing Entity or the Certificateholders for any action taken, or for refraining from the taking of any action or for errors in judgment. However, the Controlling Class Representative will not be protected against any liability to the Controlling Class Certificateholders that would otherwise be imposed by reason of willful misfeasance, bad faith or negligence in the performance of duties or by reason of negligent disregard of obligations or duties.
Each Certificateholder acknowledges and agrees, by its acceptance of its Certificates, that a Directing Holder:
(a) may have special relationships and interests that conflict with those of holders of one or more Classes of Certificates;
(b) may act solely in its own interests (or, in the case of the Controlling Class Representative, in the interests of the holders of the Controlling Class);
(c) does not have any liability or duties to the holders of any Class of Certificates (other than, in the case of the Controlling Class Representative, the Controlling Class);
(d) may take actions that favor its own interests (or, in the case of the Controlling Class Representative, the interests of the holders of the Controlling Class) over the interests of the holders of one or more Classes of Certificates; and
(e) will have no liability whatsoever (other than, in the case of the Controlling Class Representative, to a Controlling Class Certificateholder) for having so acted as set forth in (a) – (d) above, and that no Certificateholder may take any action whatsoever against any Directing Holder or any affiliate, director, officer, employee, shareholder, member, partner, agent or principal of any Directing Holder for having so acted.
Under circumstances where it is authorized or required to do so by the Pooling and Servicing Agreement, the taking, or refraining from taking, of any action by the Master Servicer or the Special Servicer in accordance with the direction of or approval of a Directing Holder, which does not violate any law or the Servicing Standard or the provisions of the Pooling and Servicing Agreement, or any related Co-Lender Agreement or intercreditor agreement, will not result in any liability on the part of the Master Servicer or the Special Servicer.
Operating Advisor
General Obligations
After the occurrence and during the continuance of a Control Termination Event, subject to the restrictions and limitations described in this prospectus supplement, the Operating Advisor will generally review the Special Servicer’s operational practices in respect of the applicable Specially Serviced Loan(s) to formulate an opinion as to whether or not those operational practices generally satisfy the Servicing Standard with respect to the
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resolution and/or liquidation of such Specially Serviced Loans, each in accordance with the Operating Advisor Standard. In addition, after the occurrence and during the continuance of a Control Termination Event, the Operating Advisor will consult with the Special Servicer in accordance with the Operating Advisor Standard with regard to certain matters with respect to the servicing of the applicable Specially Serviced Loan(s) to the extent described in this prospectus supplement and set forth in the Pooling and Servicing Agreement;provided that the Operating Advisor may consult regarding a Serviced Outside Controlled Loan Combination only if and to the extent that the holder of the related Split Mortgage Loan is granted consultation rights under the related Co-Lender Agreement. The Operating Advisor will act solely as a contracting party to the extent described in this prospectus supplement and under the Pooling and Servicing Agreement, will have no fiduciary duty, will have no other duty except with respect to its specific obligations under the Pooling and Servicing Agreement, and will have no duty or liability to any particular Class of Certificates or any Certificateholder. The Operating Advisor is not a servicer and will not be charged with changing the outcome on any particular Specially Serviced Loan. By purchasing a Certificate, potential investors acknowledge and agree that there could be multiple strategies to resolve any Specially Serviced Loan and the goal of the Operating Advisor’s participation is to provide additional monitoring relating to the Special Servicer’s compliance with the Servicing Standard in making its determinations as to which strategy to execute. After the occurrence and during the continuance of a Control Termination Event, the Operating Advisor’s review of information (other than a Final Asset Status Report and information accompanying such report) or interaction with the Special Servicer related to any specific applicable Specially Serviced Loan is only to provide background information to the Operating Advisor and to allow more meaningful interaction with the Special Servicer. Potential investors should note that the Operating Advisor is not an “advisor” for any purpose other than as specifically set forth in the Pooling and Servicing Agreement and is not an advisor to any person, including without limitation any Certificateholder. See “Risk Factors—Your Lack of Control Over the Issuing Entity and Servicing of the Mortgage Loans Can Create Risks” in this prospectus supplement.
Following the occurrence and during the continuation of a Control Termination Event, the Operating Advisor will have certain consultation rights with respect to Major Decisions with respect to the applicable Serviced Loan(s) as described under “—Directing Holder” above and “—Asset Status Reports” below and “Description of the Mortgage Pool—The Loan Combinations” in this prospectus supplement.
Prior to the occurrence and continuance of a Control Termination Event, the Operating Advisor is required to promptly review (i) all information available to Privileged Persons on the Certificate Administrator’s website with respect to the Special Servicer, assets on the CREFC® servicer watch list and the applicable Specially Serviced Loan(s) and (ii) each related Final Asset Status Report. Prior to the occurrence and continuance of a Control Termination Event, the Operating Advisor’s obligations will be limited to the review described in the immediately preceding sentence and generally will not involve an assessment of specific actions of the Special Servicer and, in any event, will be subject to limitations described in this prospectus supplement or set forth in the Pooling and Servicing Agreement.
Prior to the occurrence and continuance of a Control Termination Event, the Operating Advisor will have no specific involvement with respect to collateral substitutions, assignments, workouts, modifications, consents, waivers, insurance policies, borrower substitutions, lease modifications and amendments and other similar actions that the Special Servicer may perform with respect to such Serviced Mortgage Loan under the Pooling and Servicing Agreement.
Prior to the occurrence and continuance of a Control Termination Event, the Special Servicer will deliver to the Operating Advisor each related Final Asset Status Report. Subject to the Privileged Information Exception, the Operating Advisor will be obligated to keep confidential any Privileged Information received from the Special Servicer, the related Directing Holder or any related Serviced Companion Loan Holder (or its representative) in connection with the related Directing Holder’s or such related Serviced Companion Loan Holder’s exercise of any rights under the Pooling and Servicing Agreement (including, without limitation, in connection with any asset status report) or otherwise in connection with the Mortgage Loans.
The Operating Advisor is required to keep all Privileged Information confidential and may not disclose such Privileged Information to any person (including Certificateholders other than the Controlling Class Representative), other than (1) to the extent expressly required by the Pooling and Servicing Agreement, to the other parties to the Pooling and Servicing Agreement with a notice indicating that such information is Privileged Information or (2) pursuant to a Privileged Information Exception. Notwithstanding the foregoing, the Operating Advisor will be permitted to share Privileged Information with its affiliates and any subcontractors of the Operating Advisor that agree in writing to be bound by the same confidentiality provisions applicable to the Operating
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Advisor. Each party to the Pooling and Servicing Agreement that receives Privileged Information from the Operating Advisor with a notice stating that such information is Privileged Information may not disclose such Privileged Information to any person without the prior written consent of the Special Servicer, any related Outside Controlling Note Holder (if a Serviced Outside Controlled Loan Combination is involved) and, unless a Consultation Termination Event has occurred and is continuing, the Controlling Class Representative other than pursuant to a Privileged Information Exception.
In addition, prior to the occurrence and continuance of a Control Termination Event, the Special Servicer will forward any Appraisal Reduction Amount with respect to, and net present value calculations used in the Special Servicer’s determination of the course of action to be taken in connection with the workout or liquidation of, a Specially Serviced Loan to the Operating Advisor after they have been finalized. The Operating Advisor will review such calculations but may not opine on, or otherwise call into question, such Appraisal Reduction Amount calculations and/or net present value calculations;provided, however, if the Operating Advisor discovers a mathematical error contained in such calculations, then the Operating Advisor will be required to notify the Special Servicer and the related Directing Holder of such error.
The “Operating Advisor Standard” means the Operating Advisor is required to act solely on behalf of the Issuing Entity and in the best interest of, and for the benefit of, the Certificateholders (as a collective whole as if such Certificateholders (and, with respect to any Serviced Pari Passu Loan Combination, any related Serviced Pari Passu Companion Loan Holder(s)) constituted a single lender), and not any particular Class of those Certificateholders (as determined by the Operating Advisor in the exercise of its good faith and reasonable judgment).
“Privileged Information” means (i) any correspondence or other communications between the related Directing Holder (and, in the case of any Serviced Loan Combinations, the Serviced Companion Loan Holder or its representative) and the Special Servicer related to any Specially Serviced Loan or the exercise of the consent or consultation rights of such Directing Holder under the Pooling and Servicing Agreement and/or any related Serviced Companion Loan Holder (or its representative) under the related Co-Lender Agreement, (ii) any strategically sensitive information that the Special Servicer has reasonably determined could compromise the Issuing Entity’s position in any ongoing or future negotiations with the related borrower or other interested party, and (iii) any information subject to attorney-client privilege.
“Privileged Information Exception” means, with respect to any Privileged Information, at any time (a) such Privileged Information becomes generally available and known to the public other than as a result of a disclosure directly or indirectly by the party restricted from disclosing such Privileged Information (the “Restricted Party”), (b) it is reasonable and necessary for the Restricted Party to disclose such Privileged Information in working with legal counsel, auditors, taxing authorities or other governmental agencies, (c) such Privileged Information was already known to such Restricted Party and not otherwise subject to a confidentiality obligation and/or (d) the Restricted Party is (in the case of the Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator, any affected Serviced Companion Loan Holder and the Trustee, as evidenced by an opinion of counsel (which will be an additional expense of the Issuing Entity) delivered to each of the Master Servicer, the Special Servicer, the applicable Directing Holder, the Operating Advisor, the Certificate Administrator and the Trustee), required by law, rule, regulation, order, judgment or decree to disclose such information.
A “Final Asset Status Report” with respect to any Specially Serviced Loan, means each related asset status report, together with such other data or supporting information provided by the Special Servicer to the Operating Advisor or the related Directing Holder or any related Serviced Companion Loan Holder (or its representative), in each case, which does not include any communications (other than the related asset status report) between the Special Servicer and the related Directing Holder and/or related Serviced Companion Loan Holder (or its representative) with respect to such Specially Serviced Loan;provided that no asset status report will be considered to be a Final Asset Status Report unless any related Outside Controlling Note Holder (if a Serviced Outside Controlled Loan Combination is involved) or, prior to the occurrence and continuance of a Control Termination Event, the Controlling Class Representative (if any other Serviced Loan(s) are involved), as applicable, has either finally approved of and consented to the actions proposed to be taken in connection therewith, or has exhausted all of its rights of approval or consent or has been deemed to have approved or consented to such action or the asset status report is otherwise implemented by the Special Servicer in accordance with the terms of the Pooling and Servicing Agreement.
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After the occurrence and during the continuance of a Control Termination Event, the Special Servicer will forward any Appraisal Reduction Amount and net present value calculations with respect to a Specially Serviced Loan to the Operating Advisor and the Operating Advisor is required to promptly recalculate and verify the accuracy of the mathematical calculations and the corresponding application of the non-discretionary portion of the applicable formulas required to be utilized in connection with any such Appraisal Reduction Amount or net present value calculations used in the Special Servicer’s determination of the course of action to be taken in connection with the workout or liquidation of such Specially Serviced Loan prior to utilization by the Special Servicer. The Special Servicer will be required to deliver the foregoing calculations together with information and support materials (including such additional information reasonably requested by the Operating Advisor to confirm the mathematical accuracy of such calculations, but not including any Privileged Information) to the Operating Advisor. The Operating Advisor will recalculate and verify the accuracy of those calculations and, in the event the Operating Advisor does not agree with the mathematical calculations or the application of the applicable non-discretionary portions of the formula required to be utilized for such calculation, the Operating Advisor and Special Servicer will consult with each other in order to resolve any inaccuracy in the mathematical calculations or the application of the non-discretionary portions of the related formula in arriving at those mathematical calculations or any disagreement. In the event the Operating Advisor and Special Servicer are not able to resolve such matters, the Operating Advisor will promptly notify the Certificate Administrator and the Certificate Administrator will determine any necessary action to take in accordance with the Pooling and Servicing Agreement.
The ability to perform the duties of the Operating Advisor and the quality and the depth of any annual report will be dependent upon the timely receipt of information required to be delivered to the Operating Advisor and the accuracy and the completeness of such information. In addition, in no event will the Operating Advisor have the power to compel any transaction party to take or refrain from taking any action. It is possible that the lack of access to Privileged Information may limit or prohibit the Operating Advisor from performing its duties under the Pooling and Servicing Agreement and, in either case, the Operating Advisor will describe any such limitations in the applicable annual report and will not be subject to liability arising from its lack of access to Privileged Information.
Annual Report
Following the occurrence and during the continuance of a Control Termination Event, based on the Operating Advisor’s review of any annual compliance statement, Assessment of Compliance, Attestation Report, asset status report and other information (other than any communications between the related Directing Holder or any related Serviced Companion Loan Holder (or its representative) and the Special Servicer that would be Privileged Information) delivered to the Operating Advisor by the Special Servicer, the Operating Advisor will (if any applicable Serviced Mortgage Loan(s) were Specially Serviced Loan(s) during the prior calendar year) prepare an annual report to beprovided to the Depositor, the Rule 17g-5 information provider (which is required to promptly post such annual report on the Rule 17g-5 website), the Trustee and the Certificate Administrator (and made available through the Certificate Administrator’s website) setting forth its assessment of the Special Servicer’s performance of its duties under the Pooling andServicing Agreement on a platform-level basis with respect to the resolution and liquidation of such Specially Serviced Loan(s) and with respect to each asset status report delivered to the Operating Advisor by the Special Servicer during the prior calendar year. No annual report will be required from the Operating Advisor with respect to the Special Servicer if during the prior calendar year no asset status report was prepared by the Special Servicer in connection with a Specially Serviced Loan or REO Property. In addition, in the event the Special Servicer is replaced, the Operating Advisor’s annual report will only relate to the entity that was acting as special servicer as of December 31 of the prior calendar year and is continuing in such capacity through the date of such annual report. Only as used in connection with the Operating Advisor’s annual report, the term “platform-level basis” refers to the Special Servicer’s performance of its duties as they relate to the resolution and liquidation of Specially Serviced Loans, taking into account the Special Servicer’s specific duties under the Pooling and Servicing Agreement as well as the extent to which those duties were performed in accordance with the Servicing Standard, with reasonable consideration by the Operating Advisor of any annual compliance statement, Assessment of Compliance, Attestation Report, asset status report and other information (other than any communications between the related Directing Holder or a Serviced Companion Loan Holder (or its representative) and the Special Servicer that would be Privileged Information) delivered to the Operating Advisor by the Special Servicer pursuant to the Pooling and Servicing Agreement.
The Operating Advisor will be required to deliver any annual report produced by the Operating Advisor (at least 10 calendar days prior to its delivery to the Depositor, the Trustee and the Certificate Administrator) to (a) the Special Servicer, (b) the Controlling Class Representative (if a Serviced Loan other than a Serviced
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Outside Controlled Loan Combination is addressed and a Consultation Termination Event does not exist); and (c) the related Outside Controlling Note Holder (if a Serviced Outside Controlled Loan Combination is addressed). The Operating Advisor may, but will not be obligated to, revise the annual report based on any comments received from the Special Servicer or the Controlling Class Representative.
Following the occurrence and during the continuance of a Control Termination Event, in each annual report, the Operating Advisor, based on its review conducted in accordance with the Pooling and Servicing Agreement, will identify any material deviations (i) from the Servicing Standard and (ii) from the Special Servicer’s obligations under the Pooling and Servicing Agreement with respect to the resolution and liquidation of the applicable Specially Serviced Loan(s) based on the limited review required in the Pooling and Servicing Agreement. Each annual report will be required to comply with the confidentiality requirements described in this prospectus supplement regarding Privileged Information and as otherwise set forth in the Pooling and Servicing Agreement.
Replacement of the Special Servicer
At any time after the occurrence and during the continuance of a Consultation Termination Event, if the Operating Advisor determines that the Special Servicer is not performing its duties as required under the Pooling and Servicing Agreement or is otherwise not acting in accordance with the Servicing Standard, the Operating Advisor may recommend the replacement of the Special Servicer with respect to the Serviced Loan(s) in the manner described under “—Termination of the Special Servicer” above, subject to any related Outside Controlling Note Holder’s right to consent, as described under “—Termination of the Special Servicer” in this prospectus supplement.
Operating Advisor Termination Events
The following constitute Operating Advisor termination events under the Pooling and Servicing Agreement (each, an “Operating Advisor Termination Event”) whether any such event is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body:
(a) any failure by the Operating Advisor to observe or perform in any material respect any of its covenants or agreements or the material breach of its representations or warranties under the Pooling and Servicing Agreement, which failure continues unremedied for a period of 30 days after the date on which written notice of such failure is given to the Operating Advisor by the Trustee or to the Operating Advisor and the Trustee by the holders of Certificates having greater than 25% of the aggregate Voting Rights of all then outstanding Certificates;provided, however, that with respect to any such failure which is not curable within such 30-day period, the Operating Advisor will have an additional cure period of 30 days to effect such cure so long as it has commenced to cure such failure within the initial 30-day period and has provided the Trustee and the Certificate Administrator with an officer’s certificate certifying that it has diligently pursued, and is continuing to pursue, such cure;
(b) any failure by the Operating Advisor to perform in accordance with the Operating Advisor Standard which failure continues unremedied for a period of 30 days;
(c) any failure by the Operating Advisor to be an Eligible Operating Advisor, which failure continues unremedied for a period of 30 days;
(d) a decree or order of a court or agency or supervisory authority having jurisdiction in the premises in an involuntary case under any present or future federal or state bankruptcy, insolvency or similar law for the appointment of a conservator or receiver or liquidator in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, has been entered against the Operating Advisor, and such decree or order has remained in force undischarged or unstayed for a period of 60 days;
(e) the Operating Advisor consents to the appointment of a conservator or receiver or liquidator or liquidation committee in any insolvency, readjustment of debt, marshaling of assets and liabilities, voluntary liquidation, or similar proceedings of or relating to the Operating Advisor or of or relating to all or substantially all of its property; or
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(f) the Operating Advisor admits in writing its inability to pay its debts generally as they become due, files a petition to take advantage of any applicable insolvency or reorganization statute, makes an assignment for the benefit of its creditors, or voluntarily suspends payment of its obligations.
Upon receipt by the Certificate Administrator of notice of the occurrence of any Operating Advisor Termination Event, the Certificate Administrator will be required to promptly provide written notice to all Certificateholders electronically by posting such notice on its internet website, unless the Certificate Administrator has received notice that such Operating Advisor Termination Event has been remedied.
Rights Upon Operating Advisor Termination Event
If an Operating Advisor Termination Event occurs, and in each and every such case, so long as such Operating Advisor Termination Event has not been remedied, then either the Trustee (i) may or (ii) upon the written direction of holders of Certificates evidencing at least 25% of the Voting Rights of each Class of Non-Reduced Certificates, will be required to, terminate all of the rights and obligations of the Operating Advisor under the Pooling and Servicing Agreement, other than rights and obligations accrued prior to such termination and other than indemnification rights (arising out of events occurring prior to such termination), by written notice to the Operating Advisor.
As soon as practicable, but in no event later than 15 business days after (i) the Operating Advisor resigns (excluding circumstances where no successor operating advisor is required to be appointed) or (ii) the Trustee delivers such written notice of termination to the Operating Advisor, the Trustee will appoint a successor operating advisor that is an Eligible Operating Advisor, which successor operating advisor may be an affiliate of the Trustee. If the Trustee is the successor Master Servicer or the successor Special Servicer, neither the Trustee nor any of its affiliates will be the successor operating advisor. The Trustee will be required to provide written notice of the appointment of a successor operating advisor to the Special Servicer and the Operating Advisor within one business day of such appointment. Except as described below under “—Termination of the Operating Advisor Without Cause,” the appointment of a successor operating advisor will not be subject to the vote, consent or approval of the holder of any Class of Certificates. Upon any termination of the Operating Advisor and appointment of a successor to the Operating Advisor, the Trustee will be required to, as soon as possible, give written notice of the termination and appointment to the Special Servicer, the Master Servicer, the Certificate Administrator, the Certificateholders, the Depositor, any related Outside Controlling Note Holder and, if a Consultation Termination Event does not exist, the Controlling Class Representative. Notwithstanding the foregoing, if the Trustee is unable to find a successor Operating Advisor within 30 days of the termination of the Operating Advisor, the Depositor will be permitted to find a replacement. Unless and until a replacement Operating Advisor is appointed, no party will act as the Operating Advisor and the provisions in the Pooling and Servicing Agreement relating to consultation with respect to the Operating Advisor will not be applicable until a replacement Operating Advisor is appointed under the Pooling and Servicing Agreement.
“Eligible Operating Advisor” means an institution (i) that is the special servicer or operating advisor on a transaction rated by any of Moody’s, Fitch, KBRA, S&P, DBRS, Inc. (“DBRS”) and/or Morningstar, but has not been the special servicer or operating advisor on a transaction for which Moody’s, Fitch, KBRA, S&P, DBRS and/or Morningstar has qualified, downgraded or withdrawn its rating or ratings of, one or more classes of certificates for such transaction citing servicing concerns with the special servicer or operating advisor, as applicable, as the sole or material factor in such rating action, (ii) that can and will make the representations and warranties set forth in the Pooling and Servicing Agreement, (iii) that is not the Special Servicer or any Directing Holder or an affiliate of the Special Servicer or any Directing Holder and (iv) that has not been paid any fees, compensation or other remuneration by any Special Servicer or successor special servicer (x) in respect of its obligations under the Pooling and Servicing Agreement or (y) for the recommendation of the replacement of the Special Servicer or the appointment of a successor special servicer to become the Special Servicer.
Termination of the Operating Advisor Without Cause
Upon (i) the written direction of holders of Non-Reduced Certificates evidencing not less than 15% of the Voting Rights of the Non-Reduced Certificates requesting a vote to terminate and replace the Operating Advisor with a proposed successor operating advisor that is an Eligible Operating Advisor, and (ii) payment by such holders to the Certificate Administrator of the reasonable fees and expenses to be incurred by the Certificate Administrator in connection with administering such vote, the Certificate Administrator will promptly provide written notice to all Certificateholders and the Operating Advisor of such request by posting such notice on its internet
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website, and by mailing to all Certificateholders and the Operating Advisor. Upon the written direction of holders of more than 50% of the Voting Rights of the Non-Reduced Certificates that exercise their right to vote (provided that holders of at least 50% of the Voting Rights of the Non-Reduced Certificates exercise their right to vote), the Trustee will terminate all of the rights and obligations of the Operating Advisor under the Pooling and Servicing Agreement (other than any rights or obligations that accrued prior to the date of such termination and other than indemnification rights (arising out of events occurring prior to such termination)) by written notice to the Operating Advisor, and the proposed successor operating advisor will be appointed. The Certificate Administrator will include on each Distribution Date statement a statement that each Certificateholder and beneficial owner of Certificates may access such notices on the Certificate Administrator’s website and each Certificateholder and beneficial owner of Certificates may register to receive email notifications when such notices are posted on the website. The Certificate Administrator will be entitled to reimbursement from the requesting Certificateholders for the reasonable expenses of posting notices of such requests.
Asset Status Reports
The Special Servicer will be required to prepare an asset status report that is consistent with the Servicing Standard upon the earlier of (x) within 60 days after the occurrence of a Servicing Transfer Event and (y) prior to taking action with respect to any Major Decision (or making a determination not to take action with respect to a Major Decision) with respect to a Specially Serviced Loan.
Each asset status report will be (i) delivered to the related Directing Holder (but, if the Controlling Class Representative is the related Directing Holder, only prior to the occurrence and continuance of a Consultation Termination Event), the Operating Advisor (but only after the occurrence and during the continuance of a Control Termination Event), the Certificate Administrator (and, in the case of any Serviced Loan Combinations, the Serviced Companion Loan Holder) and (ii) made available to the Rating Agencies. If any related Outside Controlling Note Holder (if a Serviced Outside Controlled Loan Combination is involved) or the Controlling Class Representative (if any other Serviced Loan(s) are involved and a Control Termination Event does not exist), as applicable, does not disapprove of a related asset status report within 10 business days of receipt, the related Directing Holder will be deemed to have approved such asset status report and the Special Servicer will implement the recommended action as outlined in such asset status report;provided, however, that the Special Servicer may not take any actions that are contrary to applicable law, the Servicing Standard or the terms of the applicable Mortgage Loan documents. In addition, the related Directing Holder may object to any asset status report within 10 business days of receipt (but, if the Controlling Class Representative is the related Directing Holder, only if a Control Termination Event does not exist);provided, however, that, if the Special Servicer determines that emergency action is necessary to protect the related Mortgaged Property or the interests of the Certificateholders (and, in the case of any Serviced Loan Combinations, the related Serviced Companion Loan Holder), or if a failure to take any such action at such time would be inconsistent with the Servicing Standard, the Special Servicer may take actions with respect to the related Mortgaged Property before the expiration of the 10 business day period if the Special Servicer reasonably determines in accordance with the Servicing Standard that failure to take such actions before the expiration of the 10 business day period would materially and adversely affect the interest of the Certificateholders (and, in the case of any Serviced Loan Combinations, the related Serviced Companion Loan Holder(s)), and the Special Servicer has made a reasonable effort to contact the related Directing Holder (during the period that such Directing Holder has approval rights). The foregoing will not relieve the Special Servicer of its duties to comply with the Servicing Standard.
If the related Directing Holder disapproves such asset status report within 10 business days of receipt (and, if the Controlling Class Representative is the related Directing Holder, a Control Termination Event does not exist) and the Special Servicer has not made the affirmative determination described above, the Special Servicer will revise such asset status report as soon as practicable thereafter, but in no event later than 30 days after such disapproval. The Special Servicer will revise such asset status report until the related Directing Holder fails to disapprove such revised asset status report as described above (but, if the Controlling Class Representative is the related Directing Holder, only if a Control Termination Event does not exist) or until the Special Servicer makes a determination, consistent with the Servicing Standard, that such objection is not in the best interests of all the Certificateholders (and, in the case of any Serviced Loan Combinations, the related Serviced Companion Loan Holder(s)). If the related Directing Holder does not approve an asset status report within 60 business days from the first submission of an asset status report, the Special Servicer is required to take such action as directed by the related Directing Holder (but, if the Controlling Class Representative is the related Directing Holder, only if a Control Termination Event does not exist),provided such action does not violate the Servicing Standard.
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After the occurrence and during the continuance of a Control Termination Event, each of the Operating Advisor and (prior to the occurrence and continuance of a Consultation Termination Event) the Controlling Class Representative will be entitled to consult on a non-binding basis with the Special Servicer and propose alternative courses of action in respect of any asset status report. After the occurrence and during continuance of a Control Termination Event, the Special Servicer will be obligated to consider such alternative courses of action and any other feedback provided by (a) the Operating Advisor or (b) the Controlling Class Representative, as applicable. With respect to a Serviced Loan Combination, if and when so provided in the related Co-Lender Agreement, any related Serviced Pari Passu Companion Loan Holder (or its representative) will be entitled to consult on a non-binding basis with the Special Servicer and propose alternative courses of action in respect of any asset status report;provided that, in the case of a Serviced Outside Controlled Loan Combination, a related Serviced Pari Passu Companion Loan Holder (or its representative) may be the related Outside Controlling Note Holder. The Special Servicer may revise the asset status reports as it deems reasonably necessary in accordance with the Servicing Standard to take into account any input and/or recommendations of the Operating Advisor (during the continuance of a Control Termination Event) and, with respect to a Serviced Loan Combination, if and when so provided in the related Co-Lender Agreement, any related Serviced Pari Passu Companion Loan Holder (or its representative) (and, during the continuance of a Control Termination Event but prior to the occurrence and continuance of a Consultation Termination Event, the Controlling Class Representative).
The asset status report is not intended to replace or satisfy any specific consent or approval right which the related Directing Holder may have.
Notwithstanding the foregoing, the Special Servicer will not be permitted to follow any advice, direction or consultation provided by the Operating Advisor or the related Directing Holder or, with respect to the Serviced Loan Combinations, the Serviced Companion Loan Holder (or its representative), that would require or cause the Special Servicer to violate any applicable law, be inconsistent with the Servicing Standard, require or cause the Special Servicer to violate provisions of the Pooling and Servicing Agreement, require or cause the Special Servicer to violate the terms of any Serviced Mortgage Loan or Serviced Loan Combination, expose any Certificateholder or any party to the Pooling and Servicing Agreement or their affiliates officers, directors or agents to any claim, suit or liability, cause either Trust REMIC to fail to qualify as a REMIC or the Grantor Trust to fail to qualify as a grantor trust for federal income tax purposes, result in the imposition of “prohibited transaction” or “prohibited contribution” tax under the REMIC provisions of the Code, or materially expand the scope of the Special Servicer’s responsibilities under the Pooling and Servicing Agreement or any Co-Lender Agreement.
Rating Agency Confirmations
The Pooling and Servicing Agreement will provide that, notwithstanding the terms of the related Serviced Mortgage Loan documents or other provisions of the Pooling and Servicing Agreement, if any action under the Serviced Mortgage Loan documents or the Pooling and Servicing Agreement requires a Rating Agency Confirmation from each of the Rating Agencies as a condition precedent to such action, if the party (the “Requesting Party”) required to obtain such Rating Agency Confirmation has made a request to any Rating Agency for such Rating Agency Confirmation and if, within 10 business days of such request being posted to the Rule 17g-5 website established under the Pooling and Servicing Agreement, any Rating Agency has not granted such request, rejected such request or provided a Rating Agency Declination (as defined below), then (i) such Requesting Party will be required to promptly request the related Rating Agency Confirmation again and (ii) if there is no response to such second Rating Agency Confirmation request from the applicable Rating Agency within five business days of such second request, whether in the form of granting or rejecting such Rating Agency Confirmation or providing a Rating Agency Declination, then:
(x) with respect to any condition in any Serviced Mortgage Loan document requiring a Rating Agency Confirmation or any other matter under the Pooling and Servicing Agreement relating to the servicing of the Serviced Mortgage Loans (other than as set forth in clause (y) or (z) below), the Requesting Party (or, if the Requesting Party is the related borrower, then the Master Servicer (with respect to non-Specially Serviced Loans) or the Special Servicer (with respect to Specially Serviced Loans and REO Properties), as applicable) will be required to determine (with the consent of the related Directing Holder, unless, in the case of the Controlling Class Representative, a Control Termination Event has occurred and is continuing (but in each case only in the case of actions that would otherwise be Major Decisions), which consent shall be pursued by the Special Servicer and deemed given if the related Directing Holder does not respond within seven Business Days of receipt of a request from the Special Servicer to consent to the Requesting Party’s determination), in accordance with its duties under the Pooling and Servicing Agreement and in accordance
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with the Servicing Standard, whether or not such action would be in accordance with the Servicing Standard, and if the Requesting Party (or, if the Requesting Party is the related borrower, then the Master Servicer or the Special Servicer, as applicable) makes such determination, then the requirement for a Rating Agency Confirmation will not apply (provided, however, with respect to defeasance, release or substitution of any collateral relating to any Serviced Mortgage Loan, any applicable Rating Agency Confirmation requirement in the Serviced Mortgage Loan documents will not apply, even without the determination referred to in this clause (x) by the Requesting Party (or, if the Requesting Party is the related borrower, then the Master Servicer (with respect to non-Specially Serviced Loans) or the Special Servicer (with respect to Specially Serviced Loans and REO Properties), as applicable);provided, that the Master Servicer (with respect to non-Specially Serviced Loans) or the Special Servicer (with respect to Specially Serviced Loans and REO Properties), as applicable, will in any event review the other conditions required under the related Serviced Mortgage Loan documents with respect to such defeasance, release or substitution and confirm to its satisfaction in accordance with the Servicing Standard that such conditions (other than the requirement for a Rating Agency Confirmation) have been satisfied);
(y) with respect to a replacement of the Master Servicer or the Special Servicer, such condition will be considered satisfied if:
(1) Moody’s has not cited servicing concerns of the applicable replacement master servicer or special servicer as the sole or material factor in any qualification, downgrade or withdrawal of the ratings (or placement on “watch status” in contemplation of a ratings downgrade or withdrawal) of securities in any other CMBS transaction serviced by the applicable servicer prior to the time of determination, if Moody’s is the non-responding Rating Agency;
(2) KBRA has not cited servicing concerns of the applicable replacement master servicer or special servicer as the sole or material factor in any qualification, downgrade or withdrawal of the ratings (or placement on “watch status” in contemplation of a ratings downgrade or withdrawal) of securities in any other CMBS transaction serviced by the applicable servicer prior to the time of determination, if KBRA is the non-responding Rating Agency, as applicable; and
(3) as certified to, in writing, by such replacement master servicer or replacement special servicer, as applicable, the replacement master servicer or replacement special servicer is acting as master servicer or special servicer, as applicable, in a commercial mortgage loan securitization that was rated by a Rating Agency within the 12-month period prior to the date of determination and Morningstar has not qualified, downgraded or withdrawn the then-current rating or ratings of one or more classes of CMBS certificates citing servicing concerns with the replacement master servicer or replacement special servicer, as applicable, as the sole or material factor in such rating action, if Morningstar is the non-responding Rating Agency; and
(z) with respect to a replacement or successor of the Operating Advisor, such condition will be deemed to be waived with respect to any non-responding Rating Agency so long as such Rating Agency has not cited concerns regarding the replacement operating advisor as the sole or material factor in any qualification, downgrade or withdrawal of the ratings (or placement on “watch status” in contemplation of a ratings downgrade or withdrawal) of securities in any other CMBS transaction with respect to which the replacement operating advisor acts as trust advisor or operating advisor prior to the time of determination.
For all other matters or actions (a) not specifically discussed above in clauses (x), (y), or (z) above, and (b) that are not the subject of a Rating Agency Declination, the applicable Requesting Party will be required to obtain a Rating Agency Confirmation from each of the Rating Agencies. In the event an action otherwise requires a Rating Agency Confirmation from each of the Rating Agencies, in absence of such Rating Agency Confirmation, we cannot assure you that any Rating Agency will not downgrade, qualify or withdraw its ratings as a result of any such action taken by the Master Servicer or the Special Servicer in accordance with the procedures discussed above.
“Rating Agency Confirmation” means, with respect to any matter, confirmation in writing (which may be in electronic form) by each applicable Rating Agency that a proposed action, failure to act or other event specified in this prospectus supplement will not in and of itself result in the downgrade, withdrawal or qualification of the then-current rating assigned to any Class of Certificates (if then rated by the Rating Agency);provided that upon receipt of a written waiver or acknowledgment from any applicable Rating Agency indicating its decision not to
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review or declining to review the matter for which the Rating Agency Confirmation is sought (such written notice, a “Rating Agency Declination”), the requirement to receive a Rating Agency Confirmation from the applicable Rating Agency with respect to such matter will not apply.
In addition, the Pooling and Servicing Agreement will provide that, notwithstanding the terms of the related Serviced Mortgage Loan documents, the other provisions of the Pooling and Servicing Agreement or the related Co-Lender Agreement, with respect to any Serviced Companion Loan Securities, if any action relating to the servicing and administration of the related Serviced Loan or any related REO Property requires delivery of a Rating Agency Confirmation as a condition precedent to such action pursuant to the Pooling and Servicing Agreement, then such action will also require delivery of a rating agency confirmation as a condition precedent to such action from each rating agency that was or will be engaged by a party to the securitization of the Serviced Companion Loan to assign a rating to such Serviced Companion Loan Securities. The requirement to obtain a rating agency confirmation with respect to any Serviced Companion Loan Securities will be subject to, and will be permitted to be waived by the Master Servicer and the Special Servicer on, and will be deemed not to apply on, the same terms and conditions applicable to obtaining Rating Agency Confirmations, as described above and in the Pooling and Servicing Agreement.
Termination; Retirement of Certificates
The obligations created by the Pooling and Servicing Agreement will terminate upon payment (or provision for payment) to all Certificateholders of all amounts held by the Certificate Administrator and required to be paid following the earlier of (1) the final payment (or related Advance) or other liquidation of the last Mortgage Loan or REO Property, (2) the voluntary exchange of all the then outstanding certificates as described below under “—Optional Termination; Optional Mortgage Loan Purchase” or (3) the purchase or other liquidation of all of the assets of the Issuing Entity as described under “—Optional Termination; Optional Mortgage Loan Purchase” below. Written notice of termination of the Pooling and Servicing Agreement will be given by the Certificate Administrator to each Certificateholder and each Rating Agency and the final distribution will be made only upon surrender and cancellation of the Certificates at the office of the Certificate Registrar or other location specified in the notice of termination.
Optional Termination; Optional Mortgage Loan Purchase
The holders of the Controlling Class representing greater than 50% of the Certificate Principal Amount of the Controlling Class, and if the Controlling Class does not exercise its option, the Special Servicer and, if the Special Servicer does not exercise its option, the Master Servicer and, if none of the Controlling Class Certificateholders, the Special Servicer or the Master Servicer exercises its option, the holders of the Class R Certificates, representing greater than a 50% Percentage Interest of the Class R Certificates, will have the option to purchase all of the Mortgage Loans (in the case of any Serviced Loan Combinations, subject to certain rights of the related Serviced Companion Loan Holder provided for in the related Co-Lender Agreement) and all property acquired in respect of any Mortgage Loan remaining in the Issuing Entity, and thereby effect termination of the Issuing Entity and early retirement of the then outstanding Certificates, on any Distribution Date on which the aggregate Stated Principal Balance of the Mortgage Loans remaining in the Issuing Entity is less than 1% of the aggregate Stated Principal Balance of such Mortgage Loans as of the Cut-off Date. The purchase price payable upon the exercise of such option on such a Distribution Date will be an amount equal to (i) the sum of (A) the aggregate Repurchase Price (excluding the amount described in clause (vi) of the definition of “Repurchase Price”) of all the Mortgage Loans (exclusive of REO Mortgage Loans) included in the Issuing Entity, (B) the appraised value of the Issuing Entity’s portion of each REO Property, if any, included in the Issuing Entity, as determined by the Special Servicer (such appraisals in clause (i)(B) to be obtained by the Special Servicer and prepared by an Appraiser in accordance with MAI standards) and (C) the reasonable out-of-pocket expenses of the Master Servicer (unless the Master Servicer is the purchaser of such Mortgage Loans), the Special Servicer (unless the Special Servicer is the purchaser of such Mortgage Loans), the Trustee and the Certificate Administrator, as applicable, with respect to such termination,minus (ii) solely in the case where the Master Servicer or the Special Servicer is effecting such purchase, the aggregate amount of unreimbursed Advances, if any, made by the purchasing Master Servicer or Special Servicer, together with any interest accrued and payable to the purchasing Master Servicer or Special Servicer, as applicable, in respect of such Advances and any unpaid Servicing Fees or Special Servicing Fees, as applicable, remaining outstanding (which items will be deemed to have been paid or reimbursed to the purchasing Master Servicer or Special Servicer, as applicable, in connection with such purchase). We cannot assure you that payment of the Certificate Principal Amount, if any, of each outstanding
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Class of Certificatesplus accrued interest would be made in full in the event of such a termination of the Issuing Entity.
The Issuing Entity may also be terminated upon the exchange of all then outstanding Certificates (excluding the Class S and Class R Certificates) for the Mortgage Loans and each REO Property (or interests in the Mortgage Loans and each REO Property) remaining in the Issuing Entity at any time the aggregate Certificate Principal Amounts of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class D Certificates and the Class A-S, Class B and Class C Trust Components (and, correspondingly, the Class A-S, Class B, Class C and Class PEZ Certificates) and the Notional Amount of the Class X-A Certificates has been reduced to zero and the Master Servicer is paid a fee specified in the Pooling and Servicing Agreement, but all the holders of such Classes of outstanding Regular Certificates would have to voluntarily participate in such exchange.
Reports to Certificateholders; Available Information
Certificate Administrator Reports
On each Distribution Date, the Certificate Administrator will be required to provide or make available to each Certificateholder of record a Distribution Date statement in the form of Annex D to this prospectus supplement providing information relating to distributions made on that date for the relevant Class and the recent status of the Mortgage Loans.
In addition, the Certificate Administrator will provide or make available, to the extent received from the applicable person, on each Distribution Date to each Privileged Person the following reports (other than clause (1) below, the “CREFC® Reports”) prepared by the Master Servicer, the Certificate Administrator or the Special Servicer, as applicable, substantially in the forms provided in the Pooling and Servicing Agreement (which forms are subject to change) and including substantially the following information:
(1) | a report as of the close of business on the immediately preceding Determination Date, containing some categories of information regarding the Mortgage Loans provided in Annex C to this prospectus supplement in the tables under the caption “Mortgage Pool Information,” calculated, where applicable, on the basis of the most recent relevant information provided by the borrowers to the Master Servicer and by the Master Servicer to the Certificate Administrator, and presented in a loan-by-loan and tabular format substantially similar to the formats utilized in Annex A to this prospectus supplement; |
(2) | a Commercial Real Estate Finance Council (“CREFC®”) delinquent loan status report; |
(3) | a CREFC® historical loan modification/forbearance and corrected mortgage loan report; |
(4) | a CREFC® advance recovery report; |
(5) | a CREFC® total loan report; |
(6) | a CREFC® operating statement analysis report; |
(7) | a CREFC® comparative financial status report; |
(8) | a CREFC® net operating income adjustment worksheet; |
(9) | a CREFC® real estate owned status report; |
(10) | a CREFC® servicer watch list; |
(11) | a CREFC® loan level reserve and letter of credit report; |
(12) | a CREFC® property file; |
(13) | a CREFC® financial file; |
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(14) | a CREFC® loan setup file; and |
(15) | a CREFC® loan periodic update file. |
The Master Servicer or the Special Servicer, as applicable, may omit any information from these reports that the Master Servicer or the Special Servicer regards as confidential. None of the Master Servicer, the Special Servicer, the Trustee or the Certificate Administrator will be responsible for the accuracy or completeness of any information supplied to it by a borrower, the Depositor, any Sponsor, any Outside Servicer, any Outside Special Servicer or other similar party under any Outside Servicing Agreement or other third party that is included in any reports, statements, materials or information prepared or provided by the Master Servicer, the Special Servicer, the Trustee or the Certificate Administrator, as applicable. Some information will be made available to Certificateholders by electronic transmission as may be agreed upon between the Depositor and the Certificate Administrator.
Before each Distribution Date, the Master Servicer will deliver to the Certificate Administrator by electronic means:
· | a CREFC® property file; |
· | a CREFC® financial file; |
· | a CREFC® loan setup file; and |
· | a CREFC® loan periodic update file. |
In addition, the Master Servicer or the Special Servicer, as applicable, is also required to prepare the following for each Mortgaged Property and REO Property related to a Serviced Mortgage Loan:
· | Within 30 days after receipt of a quarterly operating statement, if any, for each calendar quarter, commencing with the calendar quarter ending September 30, 2015, a CREFC® operating statement analysis report but only to the extent the related borrower is required by the related Mortgage Loan documents to deliver and does deliver, or otherwise agrees to provide and does provide, that information, for the Mortgaged Property or REO Property as of the end of that calendar quarter;provided, however, that any analysis or report with respect to the first calendar quarter of each year will not be required to the extent provided in the then current applicable CREFC® guidelines (it being understood that as of the date of this prospectus supplement, the applicable CREFC® guidelines provide that such analysis or report with respect to the first calendar quarter (in each year) is not required for a Mortgaged Property unless such Mortgaged Property is analyzed on a trailing 12-month basis, or if the related Serviced Mortgage Loan is on the CREFC® Servicer Watch List). The Master Servicer or the Special Servicer, as applicable, will deliver to the Certificate Administrator, the Operating Advisor and, with respect to any Serviced Loan Combinations, the related Serviced Companion Loan Holder by electronic means the operating statement analysis upon request. |
· | Within 30 days after receipt by the Special Servicer (with respect to Specially Serviced Loans) or the Master Servicer (with respect to non-Specially Serviced Loans) of an annual operating statement for each calendar year commencing with the calendar year ending December 31, 2015, a CREFC® net operating income adjustment worksheet, but only to the extent the related borrower is required by the mortgage to deliver and does deliver, or otherwise agrees to provide and does provide, that information, presenting the computation made in accordance with the methodology described in the Pooling and Servicing Agreement to “normalize” the full year net operating income and debt service coverage numbers used by the Master Servicer to satisfy its reporting obligation described in clause (7) above. The Special Servicer or the Master Servicer will deliver to the Certificate Administrator, the Operating Advisor and, with respect to any Serviced Loan Combinations, the related Serviced Companion Loan Holder by electronic means the CREFC® net operating income adjustment worksheet upon request. |
Certificate Owners and Serviced Companion Loan Holders who are Privileged Persons may also obtain access to any of the Certificate Administrator reports upon request and pursuant to the provisions of the Pooling
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and Servicing Agreement. Otherwise, until the time Definitive Certificates are issued to evidence the Certificates, the information described above will be available to the related Certificate Owners only if DTC and its participants provide the information to Certificate Owners. See “Risk Factors—Book-Entry Registration Will Mean You Will Not Be Recognized as a Holder of Record” in this prospectus supplement.
Information Available Electronically
The Certificate Administrator will make available to any Privileged Person (provided that this prospectus supplement, the Distribution Date statements, the Pooling and Servicing Agreement, the Mortgage Loan Purchase Agreements and the SEC EDGAR filings referred to below (collectively, the “Public Documents”) will be made available to the general public) via the Certificate Administrator’s website:
(A) the following “deal documents”:
· | the prospectus and this prospectus supplement; |
· | the Pooling and Servicing Agreement, each sub-servicing agreement delivered to the Certificate Administrator from and after the Closing Date, if any, and the Mortgage Loan Purchase Agreements and any amendments and exhibits to those agreements; and |
· | the CREFC® loan setup file, delivered to the Certificate Administrator by the Master Servicer; |
(B) the following “SEC EDGAR filings“:
· | any reports on Forms 10-D, 10-K and 8-K that have been filed by the Certificate Administrator with respect to the Issuing Entity through the SEC’s Electronic Data Gathering and Retrieval (EDGAR) system; |
(C) the following “periodic reports”:
· | the Distribution Date statements; |
· | the CREFC® bond level files; |
· | the CREFC® collateral summary files; |
· | the CREFC® Reports (other than the CREFC® loan setup file),provided they are received by the Certificate Administrator; and |
· | the annual reports prepared by the Operating Advisor; |
(D) the following “additional documents”:
· | the summary of any final asset status report delivered to the Certificate Administrator in electronic format; and |
· | any Third Party Reports (or updates of Third Party Reports) delivered to the Certificate Administrator in electronic format; |
(E) the following “special notices”:
· | all special notices sent by the Certificate Administrator to the Certificateholders as described in “Description of the Offered Certificates—Certificateholder Communication—Special Notices” in this prospectus supplement; |
· | notice of any request by the holders of Certificates evidencing at least 25% of the Voting Rights of the Certificates to terminate and replace the Special Servicer or notice of any request by the |
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holders of Non-Reduced Certificates evidencing at least 15% of the Voting Rights of the Non-Reduced Certificates to terminate and replace the Operating Advisor; |
· | notice of any waiver, modification or amendment of any term of any Mortgage Loan; |
· | notice of final payment on the Certificates; |
· | all notices of the occurrence of any Servicer Termination Events received by the Certificate Administrator; |
· | notice of termination or resignation of the Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator, the Trustee, any Outside Servicer, any Outside Special Servicer, any Outside Trustee (and appointments of successors to the Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator, the Trustee, any Outside Servicer, any Outside Special Servicer or any Outside Trustee); |
· | officer’s certificates supporting any determination that any Advance was (or, if made, would be) a Non-Recoverable Advance; |
· | notice of the termination of the Issuing Entity; |
· | notice of the occurrence and continuance of a Control Termination Event; |
· | notice of the occurrence and continuance of a Consultation Termination Event; |
· | any Assessment of Compliance delivered to the Certificate Administrator; and |
· | any Attestation Reports delivered to the Certificate Administrator; |
(F) the “Investor Q&A Forum”; and
(G) solely to Certificateholders and Certificate Owners, the “Investor Registry”.
The Certificate Administrator may require a recipient of any of the information set forth above (other than the Public Documents) to execute a confidentiality agreement (which may be in the form of a web page “click-through”).
The Certificate Administrator will be required to make the “Investor Q&A Forum” available to Privileged Persons via the Certificate Administrator’s website, where Certificateholders and Certificate Owners may (a) submit inquiries to the Certificate Administrator relating to the Distribution Date statement, (b) submit inquiries to the Master Servicer or the Special Servicer relating to servicing reports prepared by that party, the Mortgage Loans or the Mortgaged Properties, (c) submit inquiries to the Operating Advisor relating to its annual reports or actions by the Master Servicer or the Special Servicer as to which the Operating Advisor has consultation rights, whether or not referenced in such an annual report and (d) view previously submitted inquiries and related answers. The Certificate Administrator will forward such inquiries to the appropriate person. The Certificate Administrator, the Operating Advisor, the Master Servicer or the Special Servicer, as applicable, will be required to answer each inquiry, unless it determines, in its respective sole discretion, that (i) the inquiry is not of a type described above, (ii) answering the inquiry (A) would not be in the best interests of the Issuing Entity and/or the Certificateholders, (B) would be in violation of applicable law, the Pooling and Servicing Agreement or the applicable Mortgage Loan documents, (C) would materially increase the duties of, or result in significant additional cost or expense to, the Certificate Administrator, the Operating Advisor, the Master Servicer or the Special Servicer, as applicable, or (D) would reasonably be expected to result in the waiver of an attorney-client privilege or the disclosure of attorney work product or (iii) it is otherwise not advisable to answer. The Certificate Administrator will be required to post the inquiries and related answers on the Investor Q&A Forum, subject to and in accordance with the Pooling and Servicing Agreement. No party to the Pooling and Servicing Agreement will be permitted to disclose Privileged Information in the Investor Q&A Forum.
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The Investor Q&A Forum may not reflect questions, answers and other communications that are not submitted through the Certificate Administrator’s website. Answers posted on the Investor Q&A Forum will be attributable only to the respondent, and no other person will certify as to the accuracy, or will have any responsibility or liability for the content of any such information.
The Certificate Administrator will be required to make the “Investor Registry” available to any Certificateholder and Certificate Owner via the Certificate Administrator’s website. Certificateholders and Certificate Owners may register on a voluntary basis for the Investor Registry and obtain information on any other Certificateholder or Certificate Owner that has also registered;provided that they comply with certain requirements as provided for in the Pooling and Servicing Agreement.
The Certificate Administrator’s website will initially be located at www.sf.citidirect.com.
Access will be provided by the Certificate Administrator to such persons upon receipt by the Certificate Administrator from such person of an Investor Certification in the form(s) attached to the Pooling and Servicing Agreement, which form(s) will also be located on and submitted electronically via the Certificate Administrator’s website. The parties to the Pooling and Servicing Agreement will not be required to provide that certification.
In connection with providing access to the Certificate Administrator’s website, the Certificate Administrator may require registration and the acceptance of a disclaimer. The Certificate Administrator will not be liable for the dissemination of information in accordance with the terms of the Pooling and Servicing Agreement. The Certificate Administrator will make no representations or warranties as to the accuracy or completeness of such documents and will assume no responsibility for them. In addition, the Certificate Administrator may disclaim responsibility for any information distributed by the Certificate Administrator for which it is not the original source. Assistance in using the website can be obtained by calling the Certificate Administrator’s customer service desk at 1-800-422-2066.
“Privileged Person” means the Depositor, the underwriters, the Master Servicer, the Special Servicer, the Controlling Class Representative (but only for so long as a Consultation Termination Event has not occurred and is not continuing), any Serviced Companion Loan Holder that delivers an Investor Certification, the Trustee, the Certificate Administrator, the Operating Advisor, the Sponsors, a designee of the Depositor and any person who provides the Certificate Administrator with an Investor Certification,provided that in no event will a borrower, manager of a Mortgaged Property, affiliate of a borrower, affiliate of a manager of a Mortgaged Property, principal, partner, member, joint venture, limited partner, employee, representative, director, advisor or investor in any of the foregoing or an agent of any of the foregoing be considered a Privileged Person.
Other Information
The Certificate Administrator (or, in the case of the Mortgage Files, the Trustee) will make available at its offices, during normal business hours, for review by any Privileged Person originals or copies of the following items to the extent they are held by the Certificate Administrator (or Trustee, as applicable):
· | the prospectus and this prospectus supplement; |
· | the Pooling and Servicing Agreement, each sub-servicing agreement delivered to the Certificate Administrator from and after the Closing Date, if any, the Mortgage Loan Purchase Agreements and any amendments and exhibits to those agreements; |
· | all Certificate Administrator reports made available to holders of each relevant class of Certificates since the Closing Date; |
· | all Distribution Date statements and all CREFC® Reports delivered or made available to Certificateholders; |
· | all Assessments of Compliance and Attestation Reports delivered to the Certificate Administrator since the Closing Date; |
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· | the most recent property inspection report prepared by or on behalf of the Master Servicer or the Special Servicer, as applicable, and delivered to the Certificate Administrator for each Mortgaged Property; |
· | any and all notices and reports delivered to the Certificate Administrator with respect to any Mortgaged Property as to which the environmental testing revealed certain environmental issues; |
· | the Mortgage Files, including any and all modifications, waivers and amendments to the terms of the Mortgage Loans entered into or consented to by the Master Servicer, the Special Servicer, any Outside Servicer or any Outside Special Servicer and delivered to the Trustee; |
· | the summary of any final asset status report delivered to the Certificate Administrator and the annual, quarterly and monthly operating statements, if any, collected by or on behalf of the Master Servicer or the Special Servicer, as applicable, and delivered to the Certificate Administrator for each Mortgaged Property; |
· | officer’s certificates supporting any determination that any Advance was (or, if made, would be) a Non-Recoverable Advance; |
· | notice of termination or resignation of the Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator, the Trustee, any Outside Servicer, any Outside Special Servicer or any Outside Trustee (and appointments of successors to the Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator, the Trustee, any Outside Servicer, any Outside Special Servicer or any Outside Trustee); |
· | notice of any request by at least 25% of the Voting Rights of the Certificates to terminate and replace the Special Servicer or notice of any request by at least 15% of the Voting Rights of the Non-Reduced Certificates to terminate and replace the Operating Advisor; |
· | all special notices sent by the Certificate Administrator to the Certificateholders pursuant to the Pooling and Servicing Agreement; |
· | any Third Party Reports (or updates of Third Party Reports) delivered to the Certificate Administrator in electronic format; and |
· | any other information that may be necessary to satisfy the requirements of subsection (d)(4)(i) of Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). |
The Certificate Administrator will provide copies of the items described above upon reasonable written request. The Certificate Administrator may require payment for the reasonable costs and expenses of providing the copies and may also require a confirmation executed by the requesting person or entity, in a form reasonably acceptable to the Certificate Administrator, to the effect that the person or entity making the request is a beneficial owner or prospective purchaser of Certificates, is requesting the information solely for use in evaluating its investment in the Certificates and will otherwise keep the information confidential. Certificateholders, by the acceptance of their Certificates, will be deemed to have agreed to keep this information confidential. The Master Servicer may, but is not required to, make information available over the internet.
The Certificate Administrator will make available all Distribution Date Statements, CREFC® Reports and supplemental notices (provided they are received by the Certificate Administrator) to certain modeling financial services (i.e., Bloomberg, L.P., Trepp, LLC, Intex Solutions, Inc., BlackRock Financial Management, Inc. and Markit Group Limited).
The Certificate Administrator is responsible for the preparation of tax returns on behalf of the Issuing Entity and the preparation of monthly reports on Form 10-D (based on information included in each monthly statement to Certificateholders and other information provided by other transaction parties) and annual reports on Form 10-K and other reports on Form 8-K that are required to be filed with the SEC on behalf of the Issuing Entity.
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The Master Servicer may (but will not be required to), in accordance with such rules and procedures as it may adopt in its sole discretion, make available through the Master Servicer’s website or otherwise, any additional information relating to the Mortgage Loans, the related Mortgaged Properties or the related borrower that is not Privileged Information, for review by the Depositor, the Trustee, the Certificate Administrator, the Master Servicer, the Special Servicer and the Operating Advisor.
Servicing of the Outside Serviced Mortgage Loans
Servicing of the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan
The Selig Office Portfolio Mortgage Loan, the Crowne Plaza Bloomington Mortgage Loan and any related REO Property will be serviced under the CGCMT 2015-GC29 Pooling and Servicing Agreement. Accordingly, the CGCMT 2015-GC29 Servicer will generally make property protection advances and remit collections on the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan to or on behalf of the Issuing Entity. However, the Master Servicer will generally be obligated to compile reports that include information on the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan, and, to the extent required by the Servicing Standard, to enforce the rights of the holders of the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan under the terms of the related Co-Lender Agreement and make P&I Advances with respect to the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan, subject to any non-recoverability determination.
The servicing arrangements with respect to Loan Combinations serviced under the CGCMT 2015-GC29 Pooling and Servicing Agreement are generally similar to, but differ in certain respects from, the servicing arrangements with respect to Loan Combinations serviced under the Pooling and Servicing Agreement. In that regard, in the case of the CGCMT 2015-GC29 Pooling and Servicing Agreement, the following are considerations relating to servicing, including the identification of some (but not all) of the differences in servicing provisions between the CGCMT 2015-GC29 Pooling and Servicing Agreement and the Pooling and Servicing Agreement:
· | Pursuant to the CGCMT 2015-GC29 Pooling and Servicing Agreement, the liquidation fee, the special servicing fee and the workout fee with respect to the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan will be similar to the corresponding fees payable under the Pooling and Servicing Agreement and will be payable in the amounts described under“Transaction Parties—Servicing Compensation, Operating Advisor Compensation and Payment of Expenses—Special Servicing Compensation” in this prospectus supplement. |
· | The CGCMT 2015-GC29 Servicer (or a primary servicer) will earn a primary servicing fee with respect to the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan that is to be calculated at 0.0025%perannum. |
· | The Master Servicer or the Trustee, as applicable, will be required to make P&I Advances with respect to the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan, unless the Master Servicer or the Trustee, as applicable, or the Special Servicer, has determined that such advance would not be recoverable from collections on such Selig Office Portfolio Mortgage Loan or Crowne Plaza Bloomington Mortgage Loan. The Special Servicer may, at its option, make a determination in accordance with the Servicing Standard that any proposed P&I Advance, if made, would be a Non-Recoverable Advance, which determination will be conclusive and binding on the Master Servicer and the Trustee. |
· | The CGCMT 2015-GC29 Servicer is obligated to make property protection advances with respect to the Selig Office Portfolio Loan Combination and the Crowne Plaza Bloomington Loan Combination. If the CGCMT 2015-GC29 Servicer determines that a property protection advance it made with respect to the related Selig Office Portfolio Loan Combination and the Crowne Plaza Bloomington Loan Combination or the related Mortgaged Property is nonrecoverable, it will be entitled to be reimbursed first from collections on, and proceeds of, the related Split Mortgage Loan and the related Companion Loan(s), on a pro rata basis (based on each such loan’s outstanding principal balance), and then from general collections on all the Mortgage Loans, from general collections of the CGCMT 2015-GC29 Issuing Entity and from general collections on the mortgage loans included in any securitization of |
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any related non-controlling Companion Loan, on a pro rata basis (based on each such loan’s outstanding principal balance). |
· | The CGCMT 2015-GC29 Special Servicer is permitted to appoint Midland as a sub-servicer should Midland be terminated as CGCMT 2015-GC29 Special Servicer without cause and Midland would otherwise be a qualified special servicer in accordance with the terms of the CGCMT 2015-GC29 Pooling and Servicing Agreement. |
· | The CGCMT 2015-GC29 Special Servicer will be required to take actions with respect to the Selig Office Portfolio Mortgage Loan or the Crowne Plaza Bloomington Mortgage Loan, as applicable, if such Mortgage Loan becomes the equivalent of a Defaulted Mortgage Loan, which actions are substantially similar to the actions described under “—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties” in this prospectus supplement. |
· | With respect to the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan, the servicing provisions relating to performing inspections and collecting operating information are substantially similar to those of the Pooling and Servicing Agreement. |
· | The requirement of the CGCMT 2015-GC29 Servicer to make compensating interest payments in respect of the Outside Serviced Mortgage Loan is similar to the requirement of the Master Servicer to make Compensating Interest Payments in respect of the Serviced Mortgage Loans under the Pooling and Servicing Agreement. |
· | The CGCMT 2015-GC29 Servicer and CGCMT 2015-GC29 Special Servicer (a) have rights related to resignation substantially similar to those of the Master Servicer and the Special Servicer and (b) are subject to servicer termination events substantially similar to those in the Pooling and Servicing Agreement, as well as the rights related thereto. |
· | The rating agencies rating the securities issued under the CGCMT 2015-GC29 Pooling and Servicing Agreement vary from the rating agencies rating the Certificates, which may cause servicing arrangements (including, but not limited to, servicer termination events) to be different under the CGCMT 2015-GC29 Pooling and Servicing Agreement than under the Pooling and Servicing Agreement. |
· | The specific types of actions constituting major decisions under the CGCMT 2015-GC29 Pooling and Servicing Agreement may differ in certain respects from those actions that constitute Major Decisions under the Pooling and Servicing Agreement, and therefore the specific types of servicer actions with respect to which the applicable outside controlling class representative will be permitted to consent will correspondingly differ. |
· | The liability of the parties to the CGCMT 2015-GC29 Pooling and Servicing Agreement will be limited in a manner similar, but not necessarily identical, to the liability of the parties to the Pooling and Servicing Agreement. |
· | Collections on the Selig Office Portfolio Loan Combination and the Crowne Plaza Bloomington Loan Combination will be maintained under the CGCMT 2015-GC29 Pooling and Servicing Agreement in a manner similar, but not necessarily identical, to collections on the Serviced Mortgage Loans and the Serviced Loan Combinations under the Pooling and Servicing Agreement, provided that rating requirements for accounts and permitted investments may vary under those two pooling and servicing agreements. |
· | The CGCMT 2015-GC29 Pooling and Servicing Agreement differs from the Pooling and Servicing Agreement in certain respects relating to one or more of the following: timing, control or consultation triggers or thresholds, terminology, allocation of ministerial duties between multiple servicers or other service providers, certificateholder or investor voting or consent thresholds, master servicer and special servicer termination events and the circumstances under which approvals, consents, consultation, notices or rating agency confirmations may be required. |
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In addition, pursuant to the Pooling and Servicing Agreement, except as otherwise expressly addressed in the Pooling and Servicing Agreement:
· | The Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator and the Trustee under the Pooling and Servicing Agreement will have no obligation or authority to (a) supervise the CGCMT 2015-GC29 Servicer, the CGCMT 2015-GC29 Special Servicer, the CGCMT 2015-GC29 Certificate Administrator, the CGCMT 2015-GC29 Trustee or the CGCMT 2015-GC29 Operating Advisor or (b) make property protection advances with respect to the Selig Office Portfolio Mortgage Loan or the Crowne Plaza Bloomington Mortgage Loan. The obligation of the Master Servicer to provide information and collections and make P&I Advances for the benefit of the Certificateholders with respect to the Selig Office Portfolio Mortgage Loan or the Crowne Plaza Bloomington Mortgage Loan is dependent on its receipt of the corresponding information and/or collections from the CGCMT 2015-GC29 Servicer or the CGCMT 2015-GC29 Special Servicer. |
· | If a party to the CGCMT 2015-GC29 Pooling and Servicing Agreement requests the Master Servicer, Special Servicer, Trustee, Certificate Administrator or Custodian to consent to a modification, waiver or amendment of, or other loan-level action related to, the Selig Office Portfolio Mortgage Loan or the Crowne Plaza Bloomington Mortgage Loan (except a modification, waiver or amendment of the CGCMT 2015-GC29 Pooling and Servicing Agreement or the related Co-Lender Agreement which will not be subject to the operation of this sentence but will instead be subject to the operation of the provisions set forth in the Pooling and Servicing Agreement), then the Master Servicer, Special Servicer, Trustee, Certificate Administrator or Custodian, as applicable, will be required to promptly deliver a copy of such request to the Master Servicer and the Special Servicer, and the Master Servicer (if such Mortgage Loan is not part of a “specially serviced loan” under the CGCMT 2015-GC29 Pooling and Servicing Agreement and only to the extent that the action would not be considered a Major Decision) or the Special Servicer (if such Mortgage Loan is part of a “specially serviced loan” under the CGCMT 2015-GC29 Pooling and Servicing Agreement or if the action would be considered a Major Decision) will be required to exercise such right of consent, with, in the case of a matter that would be a Major Decision, the consent of the Controlling Class Representative unless a Control Termination Event exists; provided, that if the Selig Office Portfolio Mortgage Loan and the Crowne Plaza Bloomington Mortgage Loan were serviced under the Pooling and Servicing Agreement and such action would not be permitted without Rating Agency Confirmation, then the Master Servicer or Special Servicer, as applicable, will not be permitted to exercise such consent right without first having obtained such Rating Agency Confirmation (payable at the expense of the party requesting such consent or approval if such requesting party is a Certificateholder or a party to the Pooling and Servicing Agreement, and otherwise from the Collection Account). |
· | Each of the Trustee, the Certificate Administrator, the Master Servicer and the Special Servicer will be required to reasonably cooperate with the Master Servicer, the Special Servicer or the Controlling Class Representative (if no Control Termination Event Exists), as applicable, to facilitate the exercise by such party of any consent or approval rights set forth in the Pooling and Servicing Agreement;provided,however, the Trustee, the Certificate Administrator, the Master Servicer and the Special Servicer will have no right or obligation to exercise any consent or consultation rights or obtain a Rating Agency Confirmation on behalf of the Controlling Class Representative. |
The CGCMT 2015-GC29 Special Servicer may be removed at any time, with or without cause, by the applicable holders of the CGCMT 2015-GC29 Certificates if a control termination event with respect to the applicable outside controlling class representative has occurred and is continuing under the CGCMT 2015-GC29 Pooling and Servicing Agreement. For so long as such a control termination event does not exist, the CGCMT 2015-GC29 Special Servicer may be replaced without cause at the direction of the applicable outside controlling class representative subject to certain conditions described under “Description of the Mortgage Pool—The Loan Combinations—The Selig Office Portfolio Loan Combination—Special Servicer Appointment Rights” and “—The Loan Combinations—The Crowne Plaza Bloomington Loan Combination—Special Servicer Appointment Rights” in this prospectus supplement. The CGCMT 2015-GC29 Special Servicer may also resign under the CGCMT 2015-GC29 Pooling and Servicing Agreement in certain circumstances.
The CGCMT 2015-GC29 Servicer and the CGCMT 2015-GC29 Special Servicer and various related persons and entities will be entitled to be indemnified by the Issuing Entity for certain losses and liabilities incurred by such party in accordance with the terms and conditions of the related Co-Lender Agreement.
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See also “Description of the Mortgage Pool—The Loan Combinations—The Selig Office Portfolio Loan Combination” and “—The Loan Combinations—The Crowne Plaza Bloomington Loan Combination” in this prospectus supplement.
Prospective investors are encouraged to review the full provisions of the CGCMT 2015-GC29 Pooling and Servicing Agreement, which is available online at www.sec.gov or by requesting a copy from the underwriters.
Servicing of the Dallas Market Center Mortgage Loan
The Dallas Market Center Mortgage Loan and any related REO Property will be serviced under the GSMS 2015-GC30 Pooling and Servicing Agreement. Accordingly, the GSMS 2015-GC30 Servicer will generally make property protection advances and remit collections on the Dallas Market Center Mortgage Loan to or on behalf of the Issuing Entity. However, the Master Servicer will generally be obligated to compile reports that include information on the Dallas Market Center Mortgage Loan, and, to the extent required by the Servicing Standard, to enforce the rights of the holders of the Dallas Market Center Mortgage Loan under the terms of the related Co-Lender Agreement and make P&I Advances with respect to the Dallas Market Center Mortgage Loan, subject to any non-recoverability determination.
The servicing arrangements with respect to Loan Combinations serviced under the GSMS 2015-GC30 Pooling and Servicing Agreement are generally similar to, but differ in certain respects from, the servicing arrangements with respect to Loan Combinations serviced under the Pooling and Servicing Agreement. In that regard, in the case of the GSMS 2015-GC30 Pooling and Servicing Agreement, the following are considerations relating to servicing, including the identification of some (but not all) of the differences in servicing provisions between the GSMS 2015-GC30 Pooling and Servicing Agreement and the Pooling and Servicing Agreement:
· | Pursuant to the GSMS 2015-GC30 Pooling and Servicing Agreement, the liquidation fee, the special servicing fee and the workout fee with respect to the Dallas Market Center Mortgage Loan will be similar to the corresponding fees payable under the Pooling and Servicing Agreement and will be payable in the amounts described above under “Transaction Parties—Servicing Compensation, Operating Advisor Compensation and Payment of Expenses—Special Servicing Compensation” in this prospectus supplement. |
· | The GSMS 2015-GC30 Servicer (or a primary servicer) will earn a primary servicing fee with respect to the Dallas Market Center Mortgage Loan that is to be calculated at 0.0025%perannum. |
· | The Master Servicer or the Trustee, as applicable, will be required to make P&I Advances with respect to the Dallas Market Center Mortgage Loan, unless the Master Servicer or the Trustee, as applicable, or the Special Servicer, has determined that such advance would not be recoverable from collections on such Dallas Market Center Mortgage Loan. The Special Servicer may, at its option, make a determination in accordance with the Servicing Standard that any proposed P&I Advance, if made, would be a Non-Recoverable Advance, which determination will be conclusive and binding on the Master Servicer and the Trustee. |
· | The GSMS 2015-GC30 Servicer is obligated to make property protection advances with respect to the Dallas Market Center Loan Combination. If the GSMS 2015-GC30 Servicer determines that a property protection advance it made with respect to the related Dallas Market Center Loan Combination or the related Mortgaged Property is nonrecoverable, it will be entitled to be reimbursed first from collections on, and proceeds of, the related Dallas Market Center Mortgage Loan and the related Companion Loans, on aprorata basis (based on each such loan’s outstanding principal balance), and then from general collections on all the Mortgage Loans, from general collections of the GSMS 2015-GC30 Issuing Entity and from general collections on the mortgage loans included in any securitization of any related non-controlling Companion Loan, on aprorata basis (based on each such loan’s outstanding principal balance). |
· | The GSMS 2015-GC30 Special Servicer will be required to take actions with respect to the Dallas Market Center Mortgage Loan if it becomes the equivalent of a Defaulted Mortgage Loan, which actions are substantially similar to the actions described under “—Realization Upon Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties” in this prospectus supplement. |
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· | With respect to the Dallas Market Center Mortgage Loan, the servicing provisions relating to performing inspections and collecting operating information are substantially similar to those of the Pooling and Servicing Agreement. |
· | The requirement of the GSMS 2015-GC30 Servicer to make compensating interest payments in respect of the Outside Serviced Mortgage Loan is similar to the requirement of the Master Servicer to make Compensating Interest Payments in respect of the Serviced Mortgage Loans under the Pooling and Servicing Agreement. |
· | The GSMS 2015-GC30 Servicer and GSMS 2015-GC30 Special Servicer (a) have rights related to resignation substantially similar to those of the Master Servicer and the Special Servicer and (b) are subject to servicer termination events substantially similar to those in the Pooling and Servicing Agreement, as well as the rights related thereto. |
· | The specific types of actions constituting major decisions under the GSMS 2015-GC30 Pooling and Servicing Agreement may differ in certain respects from those actions that constitute Major Decisions under the Pooling and Servicing Agreement, and therefore the specific types of servicer actions with respect to which the applicable outside controlling class representative will be permitted to consent will correspondingly differ. |
· | The liability of the parties to the GSMS 2015-GC30 Pooling and Servicing Agreement will be limited in a manner similar, but not necessarily identical, to the liability of the parties to the Pooling and Servicing Agreement. |
· | Collections on the Dallas Market Center Loan Combination will be maintained under the GSMS 2015-GC30 Pooling and Servicing Agreement in a manner similar, but not necessarily identical, to collections on the Serviced Mortgage Loans and the Serviced Loan Combinations under the Pooling and Servicing Agreement, provided that rating requirements for accounts and permitted investments may vary under those two pooling and servicing agreements. |
· | The GSMS 2015-GC30 Pooling and Servicing Agreement differs from the Pooling and Servicing Agreement in certain respects relating to one or more of the following: timing, control or consultation triggers or thresholds, terminology, allocation of ministerial duties between multiple servicers or other service providers, certificateholder or investor voting or consent thresholds, master servicer and special servicer termination events and the circumstances under which approvals, consents, consultation, notices or rating agency confirmations may be required. |
In addition, pursuant to the Pooling and Servicing Agreement, except as otherwise expressly addressed in the Pooling and Servicing Agreement:
· | The Master Servicer, the Special Servicer, the Operating Advisor, the Certificate Administrator and the Trustee under the Pooling and Servicing Agreement will have no obligation or authority to (a) supervise the GSMS 2015-GC30 Servicer, the GSMS 2015-GC30 Special Servicer, the GSMS 2015-GC30 Certificate Administrator, the GSMS 2015-GC30 Trustee or the GSMS 2015-GC30 Operating Advisor or (b) make property protection advances with respect to the Dallas Market Center Mortgage Loan. The obligation of the Master Servicer to provide information and collections and make P&I Advances for the benefit of the Certificateholders with respect to the Dallas Market Center Mortgage Loan is dependent on its receipt of the corresponding information and/or collections from the GSMS 2015-GC30 Servicer or the GSMS 2015-GC30 Special Servicer. |
· | If a party to the GSMS 2015-GC30 Pooling and Servicing Agreement requests the Master Servicer, Special Servicer, Trustee, Certificate Administrator or Custodian to consent to a modification, waiver or amendment of, or other loan-level action related to, the Dallas Market Center Mortgage Loan (except a modification, waiver or amendment of the GSMS 2015-GC30 Pooling and Servicing Agreement or the related Co-Lender Agreement which will not be subject to the operation of this sentence but will instead be subject to the operation set forth in the Pooling and Servicing Agreement), then the Master Servicer, Special Servicer, Trustee, Certificate Administrator or Custodian, as applicable, will be required to promptly deliver a copy of such request to the Master |
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Servicer and the Special Servicer, and the Master Servicer (if such Mortgage Loan is not part of a “specially serviced loan” under the GSMS 2015-GC30 Pooling and Servicing Agreement and only to the extent that the action would not be considered a Major Decision) or the Special Servicer (if such Mortgage Loan is part of a “specially serviced loan” under the GSMS 2015-GC30 Pooling and Servicing Agreement or if the action would be considered a Major Decision) will be required to exercise such right of consent, with, in the case of a matter that would be a Major Decision, the consent of the Controlling Class Representative unless a Control Termination Event exists; provided, that if the Dallas Market Center Mortgage Loan were serviced under the Pooling and Servicing Agreement and such action would not be permitted without Rating Agency Confirmation, then the Master Servicer or Special Servicer, as applicable, will not be permitted to exercise such consent right without first having obtained such Rating Agency Confirmation (payable at the expense of the party requesting such consent or approval if such requesting party is a Certificateholder or a party to the Pooling and Servicing Agreement, and otherwise from the Collection Account). |
· | Each of the Trustee, the Certificate Administrator, the Master Servicer and the Special Servicer will be required to reasonably cooperate with the Master Servicer, the Special Servicer or the Controlling Class Representative (if no Control Termination Event Exists), as applicable, to facilitate the exercise by such party of any consent or approval rights set forth in the Pooling and Servicing Agreement;provided,however, the Trustee, the Certificate Administrator, the Master Servicer and the Special Servicer will have no right or obligation to exercise any consent or consultation rights or obtain a Rating Agency Confirmation on behalf of the Controlling Class Representative. |
The GSMS 2015-GC30 Special Servicer may be removed at any time, with or without cause, by the applicable holders of the GSMS 2015-GC30 Certificates if a control termination event with respect to the applicable outside controlling class representative has occurred and is continuing under the GSMS 2015-GC30 Pooling and Servicing Agreement. For so long as such a control termination event does not exist, the GSMS 2015-GC30 Special Servicer may be replaced without cause at the direction of the applicable outside controlling class representative subject to certain conditions described under “Description of the Mortgage Pool—The Loan Combinations—The Dallas Market Center Loan Combination—Special Servicer Appointment Rights” in this prospectus supplement. The GSMS 2015-GC30 Special Servicer may also resign under the GSMS 2015-GC30 Pooling and Servicing Agreement in certain circumstances.
The GSMS 2015-GC30 Servicer and the GSMS 2015-GC30 Special Servicer and various related persons and entities will be entitled to be indemnified by the Issuing Entity for certain losses and liabilities incurred by such party in accordance with the terms and conditions of the related Co-Lender Agreement.
See also “Description of the Mortgage Pool—The Loan Combinations—The Dallas Market Center Loan Combination” in this prospectus supplement.
Prospective investors are encouraged to review the full provisions of the GSMS 2015-GC30 Pooling and Servicing Agreement, which is available online at www.sec.gov or by requesting a copy from the underwriters.
Use of Proceeds
The Depositor expects to receive from this offering approximately 103.9% of the aggregate principal balance of the Offered Certificates, plus accrued interest from July 1, 2015, before deducting expenses payable by the Depositor. The net proceeds from the sale of the Offered Certificates will be used by the Depositor to pay the purchase price for the Mortgage Loans and to pay certain other related expenses.
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Material Federal Income Tax Consequences
General
The following is a general discussion of the anticipated material federal income tax consequences of the purchase, ownership and disposition of the Offered Certificates. The discussion below does not purport to address all federal income tax consequences that may be applicable to particular categories of investors (such as banks, insurance companies, securities dealers, foreign persons, tax exempt investors, investors whose functional currency is not the U.S. dollar, U.S. expatriates, and investors that hold the Offered Certificates as part of a “straddle,” integrated transaction or “conversion transaction”), some of which may be subject to special rules. The authorities on which this discussion is based are subject to change or differing interpretations, and any such change or interpretation could apply retroactively. This discussion reflects the applicable provisions of the Internal Revenue Code of 1986, as amended (the “Code”), as well as regulations promulgated by the U.S. Department of the Treasury. Investors should consult their own tax advisors in determining the federal, state, local and any other tax consequences to them of the purchase, ownership and disposition of the Offered Certificates and should review the discussions under the heading “Material Federal Income Tax Consequences” in the prospectus.
Two (2) separate real estate mortgage investment conduit (“REMIC”) elections will be made with respect to designated portions of the Issuing Entity (the “Lower-Tier REMIC” and the “Upper-Tier REMIC,” respectively). The Lower-Tier REMIC and the Upper-Tier REMIC are referred to collectively as the “Trust REMICs”. The Lower-Tier REMIC will hold the Mortgage Loans (exclusive of any Excess Interest), the proceeds of the Mortgage Loans and any foreclosure property (including the Issuing Entity’s interest in any real property acquired in respect of the Outside Serviced Mortgage Loans) that secures the Mortgage Loans, and will issue certain uncertificated classes of regular interests (the “Lower-Tier Regular Interests”) to the Upper-Tier REMIC and a residual interest, represented by the Class R Certificates, as the sole class of residual interests in the Lower-Tier REMIC. The Upper-Tier REMIC will hold the Lower-Tier Regular Interests and proceeds of the Lower-Tier Regular Interests and will issue the Regular Certificates and the Trust Components as classes of regular interests in the Upper-Tier REMIC and a residual interest, represented by the Class R Certificates, as the sole class of residual interests in the Upper-Tier REMIC.
Qualification as a REMIC requires ongoing compliance with certain conditions. On the Closing Date, Orrick, Herrington & Sutcliffe LLP, special counsel to the Depositor, will deliver its opinion that, assuming (1) the making of appropriate elections, (2) compliance with the provisions of the Pooling and Servicing Agreement, each Outside Servicing Agreement and each Co-Lender Agreement, (3) the continued qualification of each REMIC formed under each Outside Servicing Agreement, and (4) compliance with applicable changes in the Code, including the REMIC provisions of the Code, for federal income tax purposes (a) the Lower-Tier REMIC and the Upper-Tier REMIC will each qualify as a REMIC, (b) the Regular Certificates and the Trust Components will evidence ownership of the “regular interests” in the Upper-Tier REMIC, (c) the Lower-Tier Regular Interests will evidence the “regular interests” in the Lower-Tier REMIC, and (d) the Class R Certificates will represent ownership of the sole class of “residual interests” in each of the Lower-Tier REMIC and the Upper-Tier REMIC within the meaning of the REMIC provisions of the Code.
In addition, in the opinion of Orrick, Herrington & Sutcliffe LLP, (i) the portions of the Issuing Entity consisting of the Class A-S, Class B and Class C Trust Components (and related amounts in the Exchangeable Distribution Account), together with the portion of the assets of the Issuing Entity consisting of the Excess Interest and the Excess Interest Distribution Account, will be treated as a grantor trust for federal income tax purposes under subpart E, part I of subchapter J of the Code (a “Grantor Trust”), (ii) the Class S Certificates will represent undivided beneficial interests in the Excess Interest and the Excess Interest Distribution Account, (iii) the Class A-S Certificates will represent undivided beneficial interests in the Class A-S Percentage Interest of the Class A-S Trust Component, the Class B Certificates will represent undivided beneficial interests in the Class B Percentage Interest of the Class B Trust Component, the Class C Certificates will represent undivided beneficial interests in the Class C Percentage Interest of the Class C Trust Component and, in each case, related amounts in the Exchangeable Distribution Account, and (iv) the Class PEZ Certificates will represent undivided beneficial interests in the Class A-S-PEZ Percentage Interest, the Class B-PEZ Percentage Interest and the Class C-PEZ Percentage Interest of the Class A-S, Class B and Class C Trust Components, respectively, and related amounts in the Exchangeable Distribution Account.
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Tax Status of Offered Certificates
Except as provided below, the Offered Certificates will be treated as “real estate assets” within the meaning of Code Section 856(c)(5)(B), and interest (including OID, if any) on the Offered Certificates will be interest described in Code Section 856(c)(3)(B) in the same proportion that, for both purposes, the assets of the Trust REMICs would be so treated. For purposes of the foregoing tests, the Trust REMICs are treated as a single REMIC. If at all times 95% or more of the assets of the Trust REMICs qualify for each of the foregoing treatments, the Offered Certificates will qualify for the corresponding status in their entirety. For purposes of Code Section 856(c)(5)(B), payments of principal and interest on Mortgage Loans that are reinvested pending distribution to holders of Regular Certificates qualify for such treatment. The Offered Certificates will be treated as assets described in Code Section 7701(a)(19)(C)(xi) to the extent that the Mortgage Loans are treated as “loans . . . secured by an interest in real property which is . . . residential real property” or “loans secured by an interest in educational, health, or welfare institutions or facilities, including structures designed or used primarily for residential purposes for students, residents, and persons under care, employees, or members of the staff of such institutions or facilities” within the meaning of Code Section 7701(a)(19)(C) (such as certain multifamily dwellings, but not other commercial properties), and otherwise will not qualify for this treatment. Holders of the Offered Certificates should consult their own tax advisors regarding the extent to which their Certificates will qualify for this treatment. Mortgage Loans that have been defeased with U.S. Treasury obligations will not qualify for the foregoing treatments. Offered Certificates held by certain financial institutions will constitute an “evidence of indebtedness” within the meaning of Code Section 582(c)(1). Moreover, the Offered Certificates will be “qualified mortgages” for another REMIC within the meaning of Code Section 860G(a)(3) if transferred to that REMIC within a prescribed time period in exchange for regular or residual interests in that REMIC. See “Material Federal Income Tax Consequences—REMICs” in the prospectus.
Taxation of the Offered Regular Certificates and the Trust Components
General
Because they represent regular interests, each Class of Offered Regular Certificates and the Trust Components represented by the Exchangeable Certificates generally will be treated as newly originated debt instruments for federal income tax purposes. Holders of the Classes of Offered Certificates will be required to include in income all interest on the regular interests represented by their Certificates in accordance with the accrual method of accounting, regardless of a Certificateholder’s usual method of accounting. For purposes of the following discussion, the treatment described below applies to a Class PEZ Certificateholder’s interest in the Class A-S, Class B and Class C Trust Components and also applies to a Class A-S, Class B and Class C Certificateholder’s interest in the related Trust Component. See “—Taxation of the Exchangeable Certificates” in this prospectus supplement.
Original Issue Discount
Holders of Offered Certificates issued with original issue discount generally must include original issue discount in ordinary income for federal income tax purposes as it accrues in accordance with the constant yield method, which takes into account the compounding of interest, in advance of receipt of the cash attributable to such income. The following discussion is based in part on temporary and final Treasury regulations (the “OID Regulations”) under Code Sections 1271 through 1273 and 1275 and in part on the provisions of the conference committee report to the Tax Reform Act of 1986. Holders of Offered Certificates should be aware, however, that the OID Regulations do not adequately address certain issues relevant to prepayable securities, such as the Offered Regular Certificates and the Trust Components represented by the Exchangeable Certificates. Investors are advised to consult their own tax advisors as to the discussions in this prospectus supplement and the prospectus and the appropriate method for reporting interest and original issue discount with respect to the Offered Certificates. See “Material Federal Income Tax Consequences—REMICs—Taxation of Owners of REMIC Regular Certificates—Original Issue Discount” in the prospectus.
Each Class of Offered Certificates (other than the Exchangeable Certificates) and the Trust Components represented by the Exchangeable Certificates will be treated as a single installment obligation for purposes of determining the original issue discount includible in an Offered Certificateholder’s income. The total amount of original issue discount on an Offered Certificate (other than the Exchangeable Certificates) or a Trust Component represented by an Exchangeable Certificate is the excess of the “stated redemption price at maturity” of the Offered Regular Certificate or Trust Component over its “issue price.” The issue price of a class of Offered
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Regular Certificates or Trust Components is the first price at which a substantial amount of Offered Regular Certificates or Trust Components represented by Exchangeable Certificates of such class is sold to investors (excluding bond houses, brokers and underwriters). Although unclear under the OID Regulations, the Certificate Administrator will treat the issue price of Offered Regular Certificates or Trust Components represented by Exchangeable Certificates as to which there is no substantial sale as of the issue date as the fair market value of such class as of the issue date. The issue price of the Offered Regular Certificates or Trust Components represented by Exchangeable Certificates also includes the amount paid by an initial Certificateholder of such class for accrued interest that relates to a period prior to the issue date of such class of Offered Regular Certificates or Trust Components. The stated redemption price at maturity of an Offered Regular Certificate or Trust Component is the sum of all payments provided by the debt instrument other than any qualified stated interest payments. Under the OID Regulations, qualified stated interest generally means interest payable at a single fixed rate or a qualified variable rate;provided that such interest payments are unconditionally payable at intervals of one year or less during the entire term of the obligation. Because there is no penalty or default remedy in the case of nonpayment of interest with respect to an Offered Regular Certificate or Trust Component represented by an Exchangeable Certificate, it is possible that no interest on any class of Offered Regular Certificates or Trust Component represented by an Exchangeable Certificate will be treated as qualified stated interest. However, because the Mortgage Loans provide for remedies in the event of default, the Certificate Administrator will treat all payments of stated interest on the Offered Regular Certificates (other than the Class X-A Certificates) and Trust Components represented by Exchangeable Certificates as qualified stated interest (other than accrued interest distributed on the first Distribution Date for the number of days that exceed the interval between the Closing Date and the first Distribution Date). Based on the foregoing, it is anticipated that the Class C Trust Component and the Class D Certificates will be issued with original issue discount.
In addition, it is anticipated that the Certificate Administrator will treat the Class X-A Certificates as having no qualified stated interest. Accordingly, such Class will be considered to be issued with original issue discount in an amount equal to the excess of all distributions of interest expected to be received thereon over its issue price (including interest accrued prior to the Closing Date). Any “negative” amounts of original issue discount on such Class attributable to rapid prepayments with respect to the Mortgage Loans will not be deductible currently. The holder of a Class X-A Certificate may be entitled to a loss deduction, which may be a capital loss, to the extent it becomes certain that such Certificateholder will not recover a portion of its basis in such Class, assuming no further prepayments. In the alternative, it is possible that rules similar to the “noncontingent bond method” of the contingent interest rules of the OID regulations may be promulgated with respect to such Classes. Unless and until required otherwise by applicable authority, it is not anticipated that the contingent interest rules will apply.
For the purposes of accruing original issue discount, if any, determining whether such original issue discount isde minimis and amortizing any premium, the prepayment assumption will be 0% CPR;provided, that it is assumed that any ARD Loan will prepay in full on its Anticipated Repayment Date (the “Prepayment Assumption”). See“Material Federal Income Tax Consequences—REMICs—Taxation of Owners of REMIC Regular Certificates—Original Issue Discount” in the prospectus.
Premium
An Offered Regular Certificate or Trust Component represented by an Exchangeable Certificate purchased upon initial issuance or in the secondary market at a cost greater than its remaining stated redemption price at maturity generally is considered to be purchased at a premium. See “Material Federal Income Tax Consequences—REMICs—Taxation of Owners of REMIC Regular Certificates—Premium” in the prospectus. It is anticipated that the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB Certificates and the Class A-S and Class B Trust Components will be issued at a premium.
Prepayment Premiums and Yield Maintenance Charges
Prepayment premiums or yield maintenance charges actually collected will be distributed among the holders of the respective classes of Certificates and Trust Components as described under “Description of the Offered Certificates—Distributions—Prepayment Premiums” in this prospectus supplement. It is not entirely clear under the Code when the amount of prepayment premiums or yield maintenance charges so allocated should be taxed to the holder of an Offered Certificate, but it is not expected, for federal income tax reporting purposes, that prepayment premiums and yield maintenance charges will be treated as giving rise to any income to the holder of an Offered Certificate prior to the Master Servicer’s actual receipt of a prepayment premium or yield maintenance charge. Prepayment premiums and yield maintenance charges, if any, may be treated as ordinary income,
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although authority exists for treating such amounts as capital gain if they are treated as paid upon the retirement or partial retirement of a Certificate. Certificateholders should consult their own tax advisers concerning the treatment of prepayment premiums and yield maintenance charges.
Taxation of the Exchangeable Certificates
The portion of the Issuing Entity comprised of the Trust Components will be classified as part of a Grantor Trust, and each Exchangeable Certificate (other than any Class PEZ Certificate) will represent an undivided, proportionate beneficial interest in the Trust Component underlying that Exchangeable Certificate (such as the Class A-S Trust Component in the case of a Class A-S Certificate, the Class B Trust Component in the case of a Class B Certificate and the Class C Trust Component in the case of a Class C Certificate). Each Exchangeable Certificate (other than any Class PEZ Certificate) will therefore represent a beneficial ownership interest in a regular interest issued by the Upper-Tier REMIC and the income tax consequences to the holder of an Exchangeable Certificate (other than any Class PEZ Certificate) with respect to the underlying Trust Component, will be the same as the income tax consequences to a holder of an Offered Regular Certificate, as described in this prospectus supplement.
The Class PEZ Certificates will represent beneficial ownership interests in all of the Trust Components, but each Trust Component will be taxable as a separate regular interest for federal income tax purposes, and the holder of a Class PEZ Certificate must account separately for its interest in each Trust Component. The income tax consequences of holding a Class PEZ Certificate with respect to each of the three Trust Components will therefore be the same as the income tax consequences to the holder of three separate and individual Offered Regular Certificates, as described in this prospectus supplement. See “—Taxation of the Offered Regular Certificates and the Trust Components” above. A purchaser must allocate its basis in the Class PEZ Certificates among the interests in each Trust Component in accordance with their relative fair market values as of the time of acquisition. Similarly, on the sale of such Class PEZ Certificate, the holder of such Class PEZ Certificate must allocate the amount received on the sale among the interests in each Trust Component in accordance with their relative fair market values as of the time of sale. Prospective beneficial owners of the Class PEZ Certificates should consult their tax advisors as to the appropriate method of accounting for their interest in the Class PEZ Certificates.
The exchange of the requisite proportions of the Class A-S, Class B and Class C Certificates for the Class PEZ Certificates, and the exchange of the Class PEZ Certificates for the requisite proportions of the Class A-S, Class B and Class C Certificates will not be taxable.
For further information regarding federal income tax reporting requirements relating to the Grantor Trust, see “Material Federal Income Tax Consequences—Grantor Trusts—Grantor Trust Reporting” and “—Backup Withholding” in the prospectus.
Further Information
For further information regarding the federal income tax consequences of investing in the Offered Certificates, including consequences of purchase, ownership and disposition of Offered Certificates by any person who is not a citizen or resident of the United States, a corporation or partnership or other entity created or organized in or under the laws of the United States, any state or the District of Columbia, or is a foreign estate or trust, see “Material Federal Income Tax Consequences—REMICs” and “—Taxation of Classes of Exchangeable Certificates” in the prospectus.
DUE TO THE COMPLEXITY OF THESE RULES AND THE CURRENT UNCERTAINTY AS TO THE MANNER OF THEIR APPLICATION TO THE ISSUING ENTITY AND CERTIFICATEHOLDERS, IT IS PARTICULARLY IMPORTANT THAT POTENTIAL INVESTORS CONSULT THEIR OWN TAX ADVISORS REGARDING THE TAX TREATMENT OF THEIR ACQUISITION, OWNERSHIP AND DISPOSITION OF THE OFFERED CERTIFICATES.
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State and Other Tax Considerations
In addition to the federal income tax consequences described in “Material Federal Income Tax Consequences” in this prospectus supplement, potential investors should consider the state, local and other tax consequences of the acquisition, ownership, and disposition of the Offered Certificates. State, local and other tax law may differ substantially from the corresponding federal tax law, and this discussion does not purport to describe any aspect of the income tax laws of any state or locality or other jurisdiction. Therefore, potential investors should consult their own tax advisors with respect to the various tax consequences of investments in the Offered Certificates.
ERISA Considerations
An investor who is—
· | a fiduciary of a plan subject to ERISA or Section 4975 of the Code (collectively, “Plans”), or |
· | any other person investing “plan assets” of any Plan, |
is encouraged to carefully review with their legal advisors whether the purchase or holding of an Offered Certificate would be a “prohibited transaction” or would otherwise be impermissible under ERISA or Section 4975 of the Code. See “ERISA Considerations” in the prospectus.
If a Plan acquires an Offered Certificate, the underlying assets of the trust fund will be deemed for purposes of ERISA to be assets of the investing Plan, unless certain exceptions apply. See “ERISA Considerations—Plan Asset Regulations” in the prospectus. However, we cannot predict in advance, nor can there be any continuing assurance, whether those exceptions may be applicable because of the factual nature of the rules set forth in the plan asset regulations under U.S. Department of Labor Reg. Section 2510.3-101, as modified by Section 3(42) of ERISA (the “Plan Asset Regulations”). For example, one of the exceptions in the Plan Asset Regulations states that the underlying assets of an entity will not be considered “plan assets” if less than 25% of the value of each class of equity interests is held by “benefit plan investors,” which include Plans and entities whose underlying assets include plan assets by reason of a Plan’s investment in such entity, but this exception will be tested immediately after each acquisition of an Offered Certificate, whether upon initial issuance or in the secondary market. Because there are no relevant restrictions on the purchase and transfer of the Offered Certificates by Plans, it cannot be assured that benefit plan investors will own less than 25% of each class of the Offered Certificates.
If one of the exceptions in the Plan Asset Regulations applies, the prohibited transaction provisions of ERISA and Section 4975 of the Code will not apply to transactions involving the issuing entity’s underlying assets. However, if any of the managers or co-managers, the mortgagors, the trustee, the servicers or other parties providing services to the issuing entity is a party in interest or a disqualified person with respect to the Plan, the acquisition or holding of Offered Certificates by that Plan could result in a prohibited transaction, unless the Underwriter Exemption, as discussed below, or some other exemption is available.
The U.S. Department of Labor issued an individual prohibited transaction exemption to a predecessor of Citigroup Global Markets Inc., Prohibited Transaction Exemption (“PTE”) 91-23 (April 18, 1991), and a substantially identical prohibited transaction exemption to Goldman, Sachs & Co., PTE 89-88 (October 17, 1989), both as amended by PTE 2013-08 (July 9, 2013) (collectively, the “Underwriter Exemption”). Subject to the satisfaction of conditions set forth in the Underwriter Exemption, it generally exempts from the application of the prohibited transaction provisions of Sections 406(a) and 407(a) of ERISA, and the excise taxes imposed on these prohibited transactions under Sections 4975(a) and (b) of the Internal Revenue Code, specified transactions relating to, among other things—
· | the servicing and operation of pools of real estate loans, such as the mortgage pool, and |
· | the purchase, sale and holding of mortgage pass-through certificates, such as the Offered Certificates, that are underwritten by an underwriter under the Underwriter Exemption. |
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The Underwriter Exemption sets forth five general conditions which, among others, must be satisfied for a transaction involving the purchase, sale and holding of an Offered Certificate to be eligible for exemptive relief under the exemption. The conditions are as follows:
· | first, the acquisition of the certificate by a Plan must be on terms that are at least as favorable to the Plan as they would be in an arm’s-length transaction with an unrelated party; |
· | second, at the time of its acquisition by the Plan, the certificate must be rated in one of the four highest generic rating categories by at least one NRSRO that meets the requirements in the Underwriter Exemption (“Exemption Rating Agency”); |
· | third, the trustee cannot be an affiliate of any other member of the Restricted Group (other than an underwriter); |
· | fourth, the following must be true— |
1. | the sum of all payments made to and retained by the underwriters must represent not more than reasonable compensation for underwriting the relevant class of certificates, |
2. | the sum of all payments made to and retained by us in connection with the assignment of mortgage loans to the Issuing Entity must represent not more than the fair market value of the obligations, and |
3. | the sum of all payments made to and retained by the Master Servicer, the Special Servicer or any sub-servicer must represent not more than reasonable compensation for that person’s services under the Pooling and Servicing Agreement and reimbursement of that person’s reasonable expenses in connection therewith; and |
· | fifth, the investing Plan must be an accredited investor as defined in Rule 501(a)(1) of Regulation D under the Securities Act of 1933, as amended. |
It is a condition to the issuance of the Offered Certificates that they receive the ratings as required by the Underwriter Exemption, and we believe that each of the Ratings Agencies meets the requirements to be an Exemption Rating Agency; consequently, the second general condition set forth above will be satisfied with respect to the Offered Certificates as of the Closing Date. In addition, the third general condition set forth above will be satisfied with respect to the Offered Certificates as of the Closing Date. We believe that the fourth general condition will be satisfied with respect to the Offered Certificates. A fiduciary of a Plan contemplating purchasing any of the Offered Certificates, whether in the initial issuance of the Offered Certificates or in the secondary market, must make its own determination that the first and fifth conditions set forth above will be satisfied with respect to such Certificates. A fiduciary of a Plan contemplating purchasing any of the Offered Certificates in the secondary market must make its own determination that at the time of such acquisition, such Certificates continue to satisfy the second general condition set forth above.
“Restricted Group” means, collectively, the following persons and entities: the trustee; the underwriters; the Depositor; the Master Servicer; the Special Servicer; any sub-servicers; the Sponsors; each borrower, if any, with respect to Mortgage Loans constituting more than 5% of the total unamortized principal balance of the mortgage pool as of the date of initial issuance of the Offered Certificates; and any and all affiliates of any of the aforementioned persons.
In order to meet the requirements to be an Exemption Rating Agency, the credit rating agency:
1. | Must be recognized by the SEC as a NRSRO, |
2. | Must have indicated on its most recently filed SEC Form NRSRO that it rates “issuers of asset-backed securities,” and |
3. | Must have had, within the 12 months prior to the initial issuance of the securities, at least 3 ”qualified ratings engagements” which are defined as (A) a rating engagement requested by an |
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issuer or underwriter in connection with the initial offering of the securities, (B) which is made public to investors generally and (C) for which the rating agency is compensated, and (D) which involves the offering of securities of the type that would be granted relief under the Exemption. |
The Underwriter Exemption also requires that the Issuing Entity meet the following requirements:
· | the trust fund must consist solely of assets of the type that have been included in other investment pools; |
· | certificates evidencing interests in those other investment pools must have been rated in one of the four highest generic categories by at least one Exemption Rating Agency; and |
· | certificates evidencing interests in those other investment pools must have been purchased by investors other than Plans for at least one year prior to any Plan’s acquisition of an Offered Certificate. |
The Depositor expects that the conditions to the applicability of the Underwriter Exemption described above generally will be met with respect to the Offered Certificates, other than those conditions which are dependent on facts unknown to the Depositor or which it cannot control, such as those relating to the circumstances of the Plan purchaser or the Plan fiduciary making the decision to purchase Offered Certificates.
Under the Underwriter Exemption, the loan-to-value ratio of any underlying mortgage loan held in the trust may not exceed 100% at the date of initial issuance of the Offered Certificates, based on the outstanding principal balance of the Mortgage Loan and the fair market value of the mortgaged real property as of the Closing Date. It is possible that, if the fair market value of any of the Mortgage Loans has declined since origination, this requirement may not be satisfied. This possibility is greater for the seasoned loans than it is for the other Mortgage Loans.
If the general conditions of the Underwriter Exemption are satisfied, it may provide an exemption from the restrictions imposed by Sections 406(a) and 407(a) of ERISA, as well as the excise taxes imposed by Sections 4975(a) and (b) of the Internal Revenue Code by reason of Sections 4975(c)(1)(A) through (D) of the Code, in connection with—
· | the direct or indirect sale, exchange or transfer of an Offered Certificate acquired by a Plan upon initial issuance from us when we are, or a mortgage loan seller, the Trustee, the Master Servicer, the Special Servicer, any sub-servicer, any provider of credit support, underwriter or borrower is, a Party in Interest with respect to the investing Plan, |
· | the direct or indirect acquisition or disposition in the secondary market of an Offered Certificate by a Plan, and |
· | the continued holding of an Offered Certificate by a Plan. |
However, no exemption is provided from the restrictions of Sections 406(a)(1)(E), 406(a)(2) and 407 of ERISA for the acquisition or holding of an Offered Certificate on behalf of a Plan sponsored by any member of the Restricted Group, if such acquisition or holding is by any person who has discretionary authority or renders investment advice with respect to the assets of that Plan.
If the specific conditions of the Underwriter Exemption set forth below are also satisfied, the Underwriter Exemption may provide an additional exemption from the restrictions imposed by Sections 406(b)(1) and (b)(2) of ERISA, and the excise taxes imposed by Sections 4975(a) and (b) of the Code by reason of Section 4975(c)(1)(E) of the Code, in connection with:
· | the direct or indirect sale, exchange or transfer of Offered Certificates in the initial issuance of securities between the issuing entity or an underwriter and a Plan when the person who has discretionary authority or renders investment advice with respect to the investment of Plan assets in the securities is: (1) a borrower with respect to 5% or less of the fair market value of the issuing entity’s assets or (2) an affiliate of such a person,provided that: (a) the Plan is not sponsored by a |
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member of the Restricted Group; (b) the Plan’s investment in each class of certificates does not exceed 25% of the outstanding securities of such class; (c) after the Plan’s acquisition of the certificates, no more than 25% of the assets over which the fiduciary has investment authority are invested in securities of the issuing entity containing assets which are sold or serviced by the same entity; and (d) in the case of initial issuance (but not secondary market transactions), at least 50% of each class of certificates and at least 50% of the aggregate interests in the issuing entity are acquired by persons independent of the Restricted Group; |
· | the direct or indirect acquisition or disposition in the secondary market of Offered Certificates by a Plan or with Plan assetsprovided that the conditions in clauses (2)(a), (b) and (c) of the prior bullet are met; and |
· | the continued holding of Offered Certificates acquired by a Plan or with Plan assets in an initial issuance or secondary market transaction meeting the foregoing requirements. |
We cannot assure you that all of the conditions for this additional exemption will be met. In particular, during periods of adverse conditions in the market for CMBS, there is an increased likelihood that (i) 50% or more of one or more classes of Offered Certificates will be sold in the initial issuance to members of the Restricted Group and (ii) 50% or more of the aggregate interest in the issuing entity will be acquired by members of the Restricted Group. Plans with respect to which a borrower or an affiliate of a borrower have investment discretion are advised to consult with counsel before acquiring any Offered Certificates.
Further, if the general conditions of the Underwriter Exemption, as well as other conditions set forth in the Underwriter Exemption are satisfied, it may provide an exemption from the restrictions imposed by Sections 406(a), 406(b) and 407(a) of ERISA, and the taxes imposed by Sections 4975(a) and (b) of the Code by reason of Section 4975(c) of the Internal Revenue Code, for transactions in connection with the servicing, management and operation of the trust fund.
Lastly, if the general conditions of the Underwriter Exemption are satisfied, it may also provide an exemption from the restrictions imposed by Sections 406(a) and 407(a) of ERISA, and the taxes imposed by Sections 4975(a) and (b) of the Code, by reason of Sections 4975(c)(1)(A) through (D) of the Code, if the restrictions are deemed to otherwise apply merely because a person is deemed to be a party in interest or a disqualified person with respect to an investing plan by virtue of—
· | providing services to the Plan, |
· | having a specified relationship to this person, or |
· | solely as a result of the Plan’s ownership of Offered Certificates. |
Before purchasing an Offered Certificate, a fiduciary of a Plan should itself confirm that the general and other conditions set forth in the Underwriter Exemption, and the other requirements set forth in the Underwriter Exemption, would be satisfied at the time of the purchase.
Exempt Plans
A governmental plan as defined in Section 3(32) of ERISA is not subject to ERISA or Section 4975 of the Internal Revenue Code. However, a governmental plan may be subject to a federal, state or local law which is, to a material extent, similar to the fiduciary or prohibited transaction provisions of ERISA or the Code (“Similar Law”). A fiduciary of a governmental plan should make its own determination as to the need for and the availability of any exemptive relief under any Similar Law.
Further Warnings
The fiduciary of a Plan should consider that the rating of a security may change. If the rating of an Offered Certificate declines below the lowest permitted rating, the Offered Certificate will no longer be eligible for relief under the Underwriter Exemption (although a Plan that had purchased the Offered Certificate when it had a permitted investment grade rating would not be required by the Underwriter Exemption to dispose of the Offered
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Certificate). If the Offered Certificate meets the requirements of the Underwriter Exemption, other than those relating to rating, such Offered Certificate may be eligible to be purchased by an insurance company general account pursuant to Sections I and III of Prohibited Transaction Class Exemption (or PTCE) 95-60.
Each beneficial owner of an Offered Certificate or any interest therein will be deemed to have represented, by virtue of its acquisition or holding of such Offered Certificate or interest therein, that either (i) it is not a Plan or an entity using assets of a Plan, (ii) it has acquired and is holding the Offered Certificates in reliance on the Underwriter Exemption, and that it understands that there are certain conditions to the availability of the Underwriter Exemption, including that the Offered Certificates must be rated, at the time of purchase, not lower than “BBB-” (or its equivalent) by an Exemption Rating Agency and that such Offered Certificate is so rated or (iii)(1) it is an insurance company, (2) the source of funds used to acquire or hold the certificate or interest therein is an “insurance company general account,” as such term is defined in PTCE 95-60 and (3) the conditions in Sections I and III of PTCE 95-60 have been satisfied.
Any fiduciary of a Plan considering whether to purchase an Offered Certificate on behalf of that Plan is encouraged to consult with its counsel regarding the applicability of the fiduciary responsibility and prohibited transaction provisions of ERISA and the Code to the investment, in particular the fiduciary of a Plan should consider whether the purchase of an Offered Certificate satisfies the ERISA restrictions concerning prudence and diversification of the investment of the assets of that Plan.
The sale of Offered Certificates to a Plan is in no way a representation or warranty by us or any of the underwriters that—
· | the investment meets all relevant legal requirements with respect to investments by Plans generally or by any particular Plan, or |
· | the investment is appropriate for Plans generally or for any particular Plan. |
Legal Investment
No Class of Offered Certificates will constitute “mortgage related securities” for purposes of the Secondary Mortgage Market Enhancement Act of 1984, as amended. The appropriate characterization of the Offered Certificates under various legal investment restrictions, and thus the ability of investors subject to these restrictions to purchase the Offered Certificates, is subject to significant interpretative uncertainties. No representations are made as to the proper characterization of the Offered Certificates for legal investment, financial institution regulatory, or other purposes, or as to the ability of particular investors to purchase the Offered Certificates under applicable legal investment restrictions. Further, any ratings downgrade of any Class of Offered Certificates by any nationally recognized statistical rating organization, as defined in Section 3(a)(62) of the Exchange Act (“NRSRO”) to less than an “investment grade” rating (i.e., lower than the top four rating categories) may adversely affect the ability of an investor to purchase or retain, or otherwise impact the regulatory characteristics of, that Class. The uncertainties described above (and any unfavorable future determinations concerning the legal investment or financial institution regulatory characteristics of the Offered Certificates) may adversely affect the liquidity and market value of the Offered Certificates. Accordingly, all investors whose investment activities are subject to legal investment laws and regulations, regulatory capital requirements, or review by regulatory authorities should consult with their own legal advisors in determining whether and to what extent the Offered Certificates will constitute legal investments for them or are subject to investment, capital or other regulatory restrictions. See“Legal Investment” in the prospectus.
The Issuing Entity will be relying on an exclusion or exemption under the Investment Company Act contained in Section 3(c)(5) of the Investment Company Act or Rule 3a-7 under the Investment Company Act, although there may be additional exclusions or exemptions available to the Issuing Entity. The Issuing Entity is being structured so as not to constitute a “covered fund” for purposes of the Volcker Rule under the Dodd-Frank Act. The Volcker Rule generally prohibits “banking entities” (which is broadly defined to include U.S. banks and bank holding companies and many non-U.S. banking entities, together with their respective subsidiaries and other affiliates) from (i) engaging in proprietary trading, (ii) acquiring or retaining an ownership interest in or sponsoring a “covered fund” and (iii) entering into certain relationships with such funds. The Volcker Rule became effective on July 21, 2012, and final regulations implementing the Volcker Rule were adopted on December 10, 2013 and became effective on April 1, 2014. Conformance with the Volcker Rule and its implementing regulations is required by July 21, 2015 (or by July 21, 2016 in respect of investments in and relationships with covered funds
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that were in place prior to December 31, 2013, with the possibility of a further one-year extension). In the interim, banking entities must make good-faith efforts to conform their activities and investments to the Volcker Rule. Under the Volcker Rule, unless otherwise jointly determined otherwise by specified federal regulators, a “covered fund” does not include an issuer that may rely on an exclusion or exemption from the definition of “investment company” under the Investment Company Act other than the exclusions contained in Section 3(c)(1) and Section 3(c)(7) of the Investment Company Act. The general effects of the Volcker Rule remain uncertain. Any prospective investor in the Offered Certificates, including a U.S. or foreign bank or a subsidiary or other affiliate thereof, should consult its own legal advisors regarding such matters and other effects of the Volcker Rule.
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Certain Legal Aspects of the Mortgage Loans
The following discussion contains a summary of certain legal aspects of the Mortgage Loans with respect to the Mortgaged Properties located in Texas, California and Illinois, and representing approximately 16.1%, 14.1% and 13.8%, respectively, of the Initial Pool Balance by allocated loan amount, which are general in nature. The summaries do not purport to be complete and are qualified in their entirety by reference to the applicable federal and state laws governing the related Mortgage Loans.
Commercial mortgage loans in Texas are generally secured by deeds of trust on the related real estate. Foreclosure of a deed of trust in Texas may be accomplished by either a non-judicial trustee’s sale under a specific power-of-sale provision set forth in the deed of trust or by judicial foreclosure. Due to the relatively short period of time involved in a non-judicial foreclosure, the judicial foreclosure process is rarely used in Texas. A judicial foreclosure action must be initiated, and a non-judicial foreclosure must be completed, within four (4) years from the date the cause of action accrues. The cause of action for the unpaid balance of the indebtedness accrues upon the maturity of the indebtedness (by acceleration or otherwise). Unless expressly waived in the deed of trust, the lender must provide the debtor with a written demand for payment, a notice of intent to accelerate the indebtedness, and a notice of acceleration prior to commencing any foreclosure action. It is customary practice in Texas for the demand for payment to be combined with the notice of intent to accelerate the indebtedness. In addition, with respect to a non-judicial foreclosure sale and notwithstanding any waiver by debtor to the contrary, the lender is statutorily required to (i) provide each debtor obligated to pay the indebtedness a notice of foreclosure sale via certified mail, postage prepaid and addressed to each debtor at such debtor’s last known address at least twenty-one (21) days before the date of the foreclosure sale; (ii) post a notice of foreclosure sale at the courthouse of each county in which the property is located; and (iii) file a notice of foreclosure sale with the county clerk of each county in which the property is located. Such twenty-one (21) day period includes the entire calendar day on which the notice is deposited with the United States mail and excludes the entire calendar day of the foreclosure sale. The statutory foreclosure notice may be combined with the notice of acceleration of the indebtedness and must contain the location of the foreclosure sale and a statement of the earliest time at which the foreclosure sale will begin. To the extent the note or deed of trust contains additional notice requirements, the lender must comply with such requirements in addition to the statutory requirements set forth above. The trustee’s sale must be performed pursuant to the terms of the deed of trust and must take place between the hours of 10 a.m. and 4 p.m. on the first Tuesday of the month, in the area designated for such sales by the county commissioners’ court of the county in which the property is located, and must begin at the time set forth in the notice of foreclosure sale or not later than three (3) hours after that time. If the property is located in multiple counties, the sale may occur in any county in which a portion of the property is located. Under Texas law, the debtor does not have the right to redeem the property after foreclosure. Any action for deficiency must be brought within two (2) years of the foreclosure sale. If the foreclosure sale price is less than the fair market value of the property, the debtor or any obligor (including any guarantor) may be entitled to an offset against the deficiency in the amount by which the fair market value of the property, less the amount of any claim, indebtedness, or obligation of any kind that is secured by a lien or encumbrance on the real property that was not extinguished by the foreclosure, exceeds the foreclosure sale price.
Mortgage loans in California are generally secured by deeds of trust on the related real estate. Foreclosure of a deed of trust in California may be accomplished by a nonjudicial trustee’s sale in accordance with the California Civil Code (so long as it is permitted under a specific provision in the deed of trust) or by judicial foreclosure in accordance with the California Code of Civil Procedure. Public notice of either the trustee’s sale or the judgment of foreclosure is given for a statutory period of time after which the mortgaged real estate may be sold by the trustee, if foreclosed pursuant to the trustee’s power of sale, or by court appointed sheriff under a judicial foreclosure. Following a judicial foreclosure sale, the borrower or its successor in interest may, for a period of up to one year, redeem the property; however, there is no redemption following a trustee’s power of sale. California’s “security first” and “one action” rules require the lender to complete foreclosure of all real estate provided as security under the deed of trust in a single action in an attempt to satisfy the full debt before bringing a personal action (if otherwise permitted) against the borrower for recovery of the debt, except in certain cases involving environmentally impaired real property where foreclosure of the real property is not required before making a claim under the indemnity. California case law has held that acts such as an offset of an unpledged account constitute violations of such statutes. Violations of such statutes may result in the loss of some or all of the security under the mortgage loan and a loss of the ability to sue for the debt. A sale by the trustee under the deed of trust does not constitute an “action” for purposes of the “one action rule”. Other statutory provisions in California limit any deficiency judgment (if otherwise permitted) against the borrower following a judicial foreclosure to the amount by which the indebtedness exceeds the fair value at the time of the public sale and in
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no event greater than the difference between the foreclosure sale price and the amount of the indebtedness. Further, under California law, once a property has been sold pursuant to a power of sale clause contained in a deed of trust (and in the case of certain types of purchase money acquisition financings, under all circumstances), the lender is precluded from seeking a deficiency judgment from the borrower or, under certain circumstances, guarantors. On the other hand, under certain circumstances, California law permits separate and even contemporaneous actions against both the borrower and any guarantors. California statutory provisions regarding assignments of rents and leases require that a lender whose loan is secured by such an assignment must exercise a remedy with respect to rents as authorized by statute in order to establish its right to receive the rents after an event of default. Among the remedies authorized by statute is the lender’s right to have a receiver appointed under certain circumstances.
Mortgage loans in Illinois are generally secured by mortgages on the related real estate. Foreclosure of a mortgage in Illinois is accomplished by judicial foreclosure. There is no power of sale in Illinois. After an action for foreclosure is commenced and the lender secures a judgment, the judgment of foreclosure will provide that the property be sold at a sale in accordance with Article 15 of the Illinois Mortgage Foreclosure Law (Article 15 of the Illinois Code of Civil Procedure) on such terms and conditions as specified by the court on the judgment of foreclosure if the full amount of the judgment is not paid prior to the scheduled sale. A sale may be conducted by any judge, sheriff or private third-party. The notice of sale must set forth, among other things, the time and location of such sale. Generally, the foreclosure sale must occur after the expiration of the applicable reinstatement and redemption periods or waiver thereof. During this period, a notice of sale must be published once a week for three (3) consecutive weeks in the county in which the property is located, the first such notice to be published not more than forty-five (45) days prior to the sale and the last such notice to be published not less than seven (7) days prior to the sale. Illinois does recognize a right of redemption, but such right may be waived by a borrower in the mortgage. Illinois does not have a “one action rule” or “anti-deficiency legislation”. Subsequent to a foreclosure sale, the court conducts a hearing to confirm the sale and enters an order confirming the sale. In the order confirming the sale pursuant to the judgment of foreclosure, the court will enter a personal judgment for deficiency against any party (i) if otherwise authorized and (ii) to the extent requested in the complaint and proven upon presentation of a report of sale and to the extent personally served. In certain circumstances, the lender may have a receiver appointed.
Other Aspects. See the discussion under “Certain Legal Aspects of the Mortgage Loans” in the prospectus regarding other legal aspects of the Mortgage Loans that you should consider prior to making any investment in the Certificates.
Ratings
It is a condition to the issuance of each Class of Offered Certificates that it receives an investment grade credit rating from one or more NRSROs engaged by the Depositor to rate the Offered Certificates (each such NRSRO engaged by the Depositor to rate the Offered Certificates, a “Rating Agency” and, collectively, the “Rating Agencies”).
We are not obligated to maintain any particular rating with respect to any class of Offered Certificates. Changes affecting the Mortgage Loans, the Mortgaged Properties, the Sponsors, the Certificate Administrator, the Trustee, the Operating Advisor, the Master Servicer, the Special Servicer, any Outside Servicer, any Outside Special Servicer or another person may have an adverse effect on the ratings of the Offered Certificates, and thus on the liquidity, market value and regulatory characteristics of the Offered Certificates, although such adverse changes would not necessarily be an event of default under the applicable Mortgage Loan.
A securities rating on mortgage pass-through certificates addresses credit risk and the likelihood of full and timely payment to the applicable certificateholders of all distributions of interest at the applicable pass-through rate on the certificates in question on each distribution date and, except in the case of interest-only certificates, the ultimate payment in full of the certificate principal amount of each class of certificates in question on a date that is not later than the rated final distribution date with respect to such class of certificates. A rating takes into consideration, among other things, the credit quality of the related pool of mortgage loans, structural and legal aspects associated with the certificates in question, and the extent to which the payment stream from the related pool of mortgage loans is adequate to make payments required under the certificates in question. A securities rating on mortgage pass-through certificates does not, however, constitute a statement regarding the likelihood, timing or frequency of prepayments (whether voluntary or involuntary) on the related mortgage loans or the degree to which the payments might differ from those originally contemplated. In addition, a rating does not
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address the likelihood, timing or frequency of voluntary or mandatory prepayments of the related mortgage loans, the tax attributes of the certificates in question or of the related issuing entity, the allocation of prepayment interest shortfalls or whether any compensating interest payments will be made, or the likelihood or frequency of yield maintenance charges, assumption fees, modification fees or penalty charges. See “Risk Factors—Nationally Recognized Statistical Rating Organizations May Assign Different Ratings to the Certificates;Ratings of the Certificates Reflect Only the Views of the Applicable Rating Agencies as of the Dates Such Ratings Were Issued;Ratings May Affect ERISA Eligibility;Ratings May Be Downgraded” in this prospectus supplement.
In addition, a securities rating on mortgage pass-through certificates does not represent an assessment of the yield to maturity that investors may experience or the possibility that the holders of interest-only certificates might not fully recover their initial investments in the event of delinquencies or defaults or rapid prepayments on the underlying mortgage loans (including both voluntary and involuntary prepayments) or the application of any realized losses. In the event that the holders of such certificates do not fully recover their investment as a result of rapid principal prepayments on the Mortgage Loans, all amounts “due” to such holders will nevertheless have been paid, and such result is consistent with the securities ratings assigned to such certificates. The Notional Amount of the Class X-A Certificates may be reduced by the allocation of realized losses and prepayments, whether voluntary or involuntary, to the Class A-1, Class A-2, Class A-3, Class A-4 and/or Class A-AB Certificates and/or the Class A-S Trust Component. The securities ratings do not address the timing or magnitude of reductions of such Notional Amount, but only the obligation to distribute interest timely on such Notional Amount as so reduced from time to time. Therefore, the securities ratings of the Class X-A Certificates should be evaluated independently from similar ratings on other types of securities.
NRSROs that were not engaged by the Depositor to rate the Offered Certificates may nevertheless issue unsolicited credit ratings on one or more Classes of Offered Certificates, relying on information they receive pursuant to Rule 17g-5 or otherwise. If any such unsolicited ratings are issued, we cannot assure you that they will not be different from any ratings assigned by the Rating Agencies. The issuance of unsolicited ratings by any NRSRO on a Class of the Offered Certificates that are lower than the ratings assigned by the Rating Agencies may adversely impact the liquidity, market value and regulatory characteristics of that Class.
As part of the process of obtaining ratings for the Offered Certificates, the Depositor had initial discussions with and submitted certain materials to five NRSROs, including the Rating Agencies. Based on preliminary feedback from those NRSROs at that time, the Depositor selected the Rating Agencies to rate the Offered Certificates (or, in the case of any particular Rating Agency, certain Classes of the Offered Certificates) and not the other NRSROs, due in part to their initial subordination levels for the various Classes of the Certificates. Had the Depositor selected alternative NRSROs to rate the Offered Certificates, we cannot assure you as to the ratings that such other NRSROs would have ultimately assigned to the Offered Certificates. In the case of one of the Rating Agencies, the Depositor has requested ratings for only certain classes of the Offered Certificates, due in part to the initial subordination levels provided by such Rating Agency for the various classes of the Offered Certificates. If the Depositor had selected such Rating Agency to rate the remaining Classes of Offered Certificates not rated by it, its ratings of such Certificates may have been different, and potentially lower, than those ratings ultimately assigned to such Certificates by the other NRSROs engaged to rate such Certificates.Although unsolicited ratings may be issued by any NRSRO, an NRSRO might be more likely to issue an unsolicited rating if it was not selected after having provided preliminary feedback to the Depositor.
Furthermore, the SEC may determine that any or all of the Rating Agencies no longer qualifies as an NRSRO or is no longer qualified to rate the Offered Certificates, and that determination may also have an adverse effect on the liquidity, market value and regulatory characteristics of the Offered Certificates.
Certain actions provided for in the loan agreements require, as a condition to taking such action, that a Rating Agency Confirmation be obtained from each Rating Agency. In certain circumstances, this condition may be deemed to have been met or waived without such a Rating Agency Confirmation being obtained. See the definition of “Rating Agency Confirmation” in this prospectus supplement. In the event such an action is taken without a Rating Agency Confirmation being obtained, we cannot assure you that the applicable Rating Agency will not downgrade, qualify or withdraw its ratings as a result of the taking of such action. If you invest in the Offered Certificates, pursuant to the Pooling and Servicing Agreement your acceptance of Offered Certificates will constitute an acknowledgment and agreement with the procedures relating to Rating Agency Confirmations described under the definition of “Rating Agency Confirmation” in this prospectus supplement.
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Any rating of the Offered Certificates should be evaluated independently from similar ratings on other types of securities. A security rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time by the assigning Rating Agency.
Pursuant to agreements between Depositor and each Rating Agency, the Rating Agencies will provide ongoing ratings surveillance with respect to the Offered Certificates for as long as they remain issued and outstanding. The Depositor is responsible for the fees paid to the Rating Agencies to rate and to provide ongoing rating surveillance with respect to the Offered Certificates.
Plan of Distribution (Underwriter Conflicts of Interest)
Citigroup Global Markets Inc., Goldman, Sachs & Co., Drexel Hamilton, LLC and the Depositor have entered into an underwriting agreement with respect to the Offered Certificates, pursuant to which the Depositor has agreed to sell to the underwriters, and the underwriters have severally but not jointly agreed to purchase from the Depositor, the respective Certificate Principal Amount or Notional Amount, as applicable, of each class of Offered Certificates set forth below. In connection with the offering contemplated by this prospectus supplement, Citigroup Global Markets Inc. and Goldman, Sachs & Co. are acting as co-lead managers and joint bookrunners with respect to approximately 52.0% and 48.0%, respectively, of the total principal balance of the Offered Certificates, and Drexel Hamilton, LLC is acting as a co-manager.
Class | Citigroup Global Markets Inc. | Goldman, Sachs & Co. | Drexel Hamilton, LLC | |||||||
Class A-1 | $ | 14,738,645 | $ | 13,591,355 | $ 0 | |||||
Class A-2 | $ | 1,195,531 | $ | 1,102,469 | $ 0 | |||||
Class A-3 | $ | 83,239,789 | $ | 76,760,211 | $ 0 | |||||
Class A-4 | $ | 139,803,306 | $ | 128,920,694 | $ 0 | |||||
Class A-AB | $ | 24,438,162 | $ | 22,535,838 | $ 0 | |||||
Class X-A | $ | 293,986,807 | $ | 271,102,193 | $ 0 | |||||
Class A-S | $ | 30,571,373 | $ | 28,191,627 | $ 0 | |||||
Class B | $ | 22,303,581 | $ | 20,567,419 | $ 0 | |||||
Class PEZ | $ | 0 | $ | 0 | $ 0 | |||||
Class C | $ | 17,611,458 | $ | 16,240,542 | $ 0 | |||||
Class D | $ | 12,633,719 | $ | 11,650,281 | $ 0 |
The Depositor estimates that its share of the total expenses of the offering, excluding underwriting discounts and commissions, will be approximately $4,154,265.
The Depositor and the Sponsors have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act.
The Depositor has been advised by the underwriters that they propose to offer the Offered Certificates to the public from time to time in one or more negotiated transactions, or otherwise, at varying prices to be determined at the time of sale. The underwriters may effect the transactions by selling the Offered Certificates to or through dealers, and the dealers may receive compensation in the form of underwriting discounts, concessions or commissions from the underwriters.
The Offered Certificates are a new issue of securities with no established trading market. The Depositor has been advised by the underwriters that they intend to make a market in the Offered Certificates, but are not obligated to do so and may discontinue market making at any time without notice. No assurance can be given as to the liquidity of the trading market for the Offered Certificates.
We cannot assure you that a secondary market for the Offered Certificates will develop or, if it does develop, that it will continue. The primary source of ongoing information available to investors concerning the Offered Certificates will be the monthly statements discussed under “The Pooling and Servicing Agreement—Reports to Certificateholders; Available Information” in this prospectus supplement, which will include information as to the outstanding principal balance or notional amount, as applicable, of the Offered Certificates and the status of the applicable form of credit enhancement. Except as described under “The Pooling and Servicing Agreement—Reports to Certificateholders; Available Information” in this prospectus supplement, we cannot assure you that any additional information regarding the Offered Certificates will be available through any other source. In addition, we are not aware of any source through which price information about the Offered Certificates will be generally available on an ongoing basis. The limited nature of that information regarding the Offered Certificates
S-355 |
may adversely affect the liquidity of the Offered Certificates, even if a secondary market for the Offered Certificates becomes available.
Citigroup Global Markets Inc., one of the underwriters, is an affiliate of the Depositor, CGMRC (a Sponsor and an Originator) and the Certificate Administrator. Goldman, Sachs & Co., one of the underwriters, is an affiliate of GSMC (a Sponsor, an Originator and the initial holder ofone of the Selig Office Portfolio Companion Loans and one of the Dallas Market Center Companion Loans) and GS Commercial Real Estate LP (an Originator). See “Risk Factors—Interests and Incentives of the Originators, the Sponsors and Their Affiliates May Not Be Aligned with Your Interests” and “—Interests and Incentives of the Underwriter Entities May Not Be Aligned with Your Interests” in this prospectus supplement.
A substantial portion of the net proceeds of this offering (after the payment of underwriting compensation and transaction expenses) is intended to be directed to affiliates of Citigroup Global Markets Inc., one of the underwriters and one of the co-lead managers and joint bookrunners for this offering, and Goldman, Sachs & Co., one of the underwriters and one of the co-lead managers and joint bookrunners for this offering. That flow of funds will occur by means of the collective effect of the payment by the underwriters to the Depositor of the purchase price for the Offered Certificates and (i) the payment by the Depositor to CGMRC, an affiliate of Citigroup Global Markets Inc., in its capacity as a Sponsor, of the purchase price for the CGMRC Mortgage Loans, and (ii) the payment by the Depositor to GSMC, an affiliate of Goldman, Sachs & Co., in its capacity as a Sponsor, of the purchase price for the GSMC Mortgage Loans. See “Transaction Parties—The Sponsors” in this prospectus supplement. In addition, (i) proceeds received by Rialto in connection with the contribution of the Rialto Mortgage Loans to this securitization transaction will be applied, among other things, to directly or indirectly reacquire any such Mortgage Loans that are financed with, and to make payments to, Goldman Sachs Bank USA, an affiliate of Goldman, Sachs & Co., as the repurchase agreement counterparty; (ii) proceeds received by RAIT in connection with the contribution of the RAIT Mortgage Loans to this securitization transaction will be applied, among other things, to directly or indirectly reacquire any such Mortgage Loans that are financed with, and to make payments to, Citibank, an affiliate of Citigroup Global Markets Inc., as the repurchase agreement counterparty; and (iii) proceeds received by KGS in connection with the contribution of the KGS Mortgage Loans to this securitization transaction will be applied, among other things, to directly or indirectly reacquire any such Mortgage Loans that are financed with, and to make payments to, Citibank, an affiliate of Citigroup Global Markets Inc., as the repurchase agreement counterparty.
As a result of the circumstances described above, Citigroup Global Markets Inc. and Goldman, Sachs & Co. have a “conflict of interest” within the meaning of Rule 5121 of the consolidated rules of The Financial Industry Regulatory Authority, Inc. In addition, other circumstances exist that result in the underwriters or their affiliates having conflicts of interest, notwithstanding that such circumstances may not constitute a “conflict of interest” within the meaning of such Rule 5121. See “Risk Factors—Interests and Incentives of the Underwriter Entities May Not Be Aligned with Your Interests” in this prospectus supplement.
Legal Matters
The validity of the Offered Certificates and certain federal income tax matters will be passed upon for the Depositor by Orrick, Herrington & Sutcliffe LLP, New York, New York. Certain legal matters will be passed upon for the underwriters by Mayer Brown LLP, Charlotte, North Carolina.
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Index of Certain Defined Terms
2010 PD Amending Directive | S-9 | CGMRC Data File | S-180 | |
AB Loan Combination | S-109 | CGMRC Mortgage Loans | S-112 | |
Acceptable Insurance Default | S-285 | CGMRC Securitization Database | S-180 | |
Accredited Investor | S-11 | Citibank | S-214 | |
Actual/360 Basis | S-151 | Class | S-241 | |
Additional Permitted Debt | S-129 | Class A-AB Scheduled Principal Balance | S-251 | |
Additional Permitted Debt Election | S-129 | Class A-S Percentage Interest | S-243 | |
Administrative Fee Rate | S-217, S-249 | Class A-S Trust Component | S-243 | |
ADR | S-113 | Class A-S-PEZ Percentage Interest | S-243 | |
Advance Rate | S-288 | Class B Percentage Interest | S-243 | |
Advances | S-287 | Class B Trust Component | S-243 | |
Airspace Parcel | S-135 | Class B-PEZ Percentage Interest | S-243 | |
Allocated Cut-off Date Loan Amount | S-114 | Class C Percentage Interest | S-243 | |
Ancillary Fees | S-227 | Class C Trust Component | S-243 | |
Annual Debt Service | S-114 | Class C-PEZ Percentage Interest | S-243 | |
Anticipated Repayment Date | S-151 | Class PEZ Component | S-244 | |
Appraisal Date | S-114 | Class PEZ Component A-S | S-244 | |
Appraisal Reduction Amount | S-261 | Class PEZ Component B | S-244 | |
Appraisal Reduction Event | S-260 | Class PEZ Component C | S-244 | |
Appraised Value | S-114 | Class X Certificates | S-241 | |
Appraised-Out Class | S-263 | Class X Strip Rate | S-248 | |
Appraiser | S-262 | Clearstream | S-265 | |
ARD | S-114 | Clearstream Participants | S-267 | |
ARD Loan | S-151 | Closing Date | S-113 | |
Assessment of Compliance | S-296 | CMBS | S-65 | |
Assumption Fees | S-228 | Code | S-342 | |
Attestation Report | S-297 | Co-Lender Agreement | S-161 | |
Available Funds | S-246 | Collection Account | S-291 | |
Balloon Balance | S-115 | Collection Period | S-247 | |
Balloon Mortgage Loans | S-151 | Collective Investment Scheme | S-8 | |
Bankruptcy Code | S-66 | Companion Loan | S-109 | |
Base Interest Fraction | S-255 | Companion Loan Holder | S-109 | |
Beds | S-120 | Companion Loan Rating Agency | S-300 | |
Borrower Delayed Reimbursements | S-227 | Compensating Interest Payment | S-259 | |
B-Piece Buyer | S-100 | Condemnation Proceeds | S-247 | |
CBE | S-277 | Consent Fees | S-227 | |
Certificate Administrator | S-214 | Consultation Termination Event | S-318 | |
Certificate Owners | S-266 | Control Eligible Certificates | S-263, S-317 | |
Certificate Principal Amount | S-242 | Control Termination Event | S-318 | |
Certificate Registrar | S-266 | Controlling Class | S-317 | |
Certificate Summary | S-6 | Controlling Class Certificateholder | S-317 | |
Certificateholder | S-264 | Controlling Class Representative | S-317 | |
Certificates | S-241 | Controlling Note Holder | S-161 | |
Certifying Certificateholder | S-268 | Corrected Loan | S-286 | |
CGCMT 2015-GC29 Certificate Administrator | S-162 | CPR | S-272 | |
CGCMT 2015-GC29 Certificates | S-110 | CREFC® | S-330 | |
CGCMT 2015-GC29 Controlling Class | CREFC® Intellectual Property Royalty | |||
Representative | S-112 | License Fee | S-249 | |
CGCMT 2015-GC29 Issuing Entity | S-111 | CREFC® Reports | S-330 | |
CGCMT 2015-GC29 Operating Advisor | S-162 | Cross Over Date | S-254 | |
CGCMT 2015-GC29 Pooling and Servicing | Crossed Group | S-115 | ||
Agreement | S-111 | Crowne Plaza Bloomington Companion Loan | S-111 | |
CGCMT 2015-GC29 Securitization | S-110 | Crowne Plaza Bloomington Loan | ||
CGCMT 2015-GC29 Servicer | S-111 | Combination | S-111 | |
CGCMT 2015-GC29 Special Servicer | S-112 | Crowne Plaza Bloomington Mortgage Loan | S-110 | |
CGCMT 2015-GC29 Trustee | S-112 | CRR | S-69 | |
CGMRC | S-112, S-179 | Custodian | S-212, S-314 |
S-357 |
Cut-off Date | S-109 | FDEP | S-134 | |
Cut-off Date Balance | S-109 | FDIA | S-94 | |
Cut-off Date DSCR | S-116 | FDIC | S-94 | |
Cut-off Date Loan-to-Value Ratio | S-115 | FDIC Safe Harbor | S-94 | |
Cut-off Date LTV Ratio | S-115 | FIEL | S-11 | |
Dallas Market Center Combination | S-111 | Final Asset Status Report | S-322 | |
Dallas Market Center Companion Loan | S-111 | Financial Promotion Order | S-8 | |
Dallas Market Center Mortgage Loan | S-110 | Form 8-K | S-178 | |
DBNTC | S-212 | FPO Persons | S-8 | |
DBRS | S-325 | FSMA | S-8 | |
DBTCA | S-212 | Goldman Originators | S-197 | |
Debt Service Coverage Ratio | S-116 | Grantor Trust | S-342 | |
Debt Yield on Underwritten NCF | S-115 | Ground Lease | E-1-10 | |
Debt Yield on Underwritten Net Cash Flow | S-115 | GS Bank | S-94 | |
Debt Yield on Underwritten Net Operating | GS CRE | S-113 | ||
Income | S-116 | GS CRE Mortgage Loans | S-113 | |
Debt Yield on Underwritten NOI | S-116 | GSMC | S-112, S-183 | |
Defaulted Mortgage Loan | S-230 | GSMC Data Tape | S-184 | |
Defeasance | E-1-9 | GSMC Deal Team | S-184 | |
Defeasance Deposit | S-155 | GSMC Mortgage Loans | S-112 | |
Defeasance Loans | S-155 | GSMS 2015-GC30 Certificate Administrator | S-166 | |
Defeasance Lock Out Period | S-155 | GSMS 2015-GC30 Certificates | S-110 | |
Defeasance Option | S-155 | GSMS 2015-GC30 Controlling Class | ||
Defective Mortgage Loan | S-177 | Representative | S-112 | |
Definitive Certificate | S-265 | GSMS 2015-GC30 Issuing Entity | S-111 | |
Depositaries | S-266 | GSMS 2015-GC30 Operating Advisor | S-166 | |
Depositor | S-113, S-192 | GSMS 2015-GC30 Pooling and Servicing | ||
Determination Date | S-247 | Agreement | S-111 | |
Directing Holder | S-317 | GSMS 2015-GC30 Securitization | S-110 | |
Disclosable Special Servicer Fees | S-231 | GSMS 2015-GC30 Servicer | S-112 | |
Distribution Account | S-291 | GSMS 2015-GC30 Special Servicer | S-112 | |
Distribution Date | S-245 | GSMS 2015-GC30 Trustee | S-112 | |
Dodd Frank Act | S-70 | Hard Lockbox | S-116 | |
DSCR | S-116 | Indirect Participants | S-266 | |
DTC | S-265 | Initial Pool Balance | S-109 | |
DTC Participants | S-266 | Initial Rate | S-152 | |
Due Date | S-151 | In-Place Cash Management | S-116 | |
Due Diligence Questionnaire | S-181 | Institutional Investor | S-10 | |
Due Diligence Requirement | S-69 | Insurance Rating Requirements | E-1-4 | |
EEA | S-69 | Interest Accrual Amount | S-247 | |
Eligible Operating Advisor | S-325 | Interest Accrual Period | S-247 | |
Environmental Condition | E-1-12 | Interest Distribution Amount | S-247 | |
ESA | S-132, E-1-12 | Interest Only Mortgage Loans | S-151 | |
Euroclear | S-265 | Interest Reserve Account | S-291 | |
Euroclear Operator | S-267 | Interest Shortfall | S-247 | |
Euroclear Participants | S-267 | Interested Person | S-311 | |
Excess Interest | S-152 | Investment Company Act | S-1 | |
Excess Interest Distribution Account | S-291 | Investor Certification | S-265 | |
Excess Liquidation Proceeds Reserve | Investor Q&A Forum | S-333 | ||
Account | S-291 | Investor Registry | S-333, S-334 | |
Excess Modification Fees | S-227 | Issuing Entity | S-109 | |
Excess Penalty Charges | S-228 | KBRA | S-300 | |
Excess Prepayment Interest Shortfall | S-259 | KGS | S-113, S-190 | |
Exchange Act | S-178 | KGS Data Tape | S-191 | |
Exchange Date | S-245 | KGS Holdings | S-174 | |
Exchangeable Certificates | S-241 | KGS Mortgage Loans | S-113 | |
Exchangeable Distribution Account | S-292 | KGS Review Team | S-190 | |
Exchangeable Proportion | S-244 | Largest Tenant | S-116 | |
Exemption Rating Agency | S-347 | Largest Tenant Lease Expiration | S-116 |
S-358 |
Liquidation Fee | S-229 | Originators | S-113, S-193 | |
Liquidation Fee Rate | S-230 | Other Crossed Loans | S-177 | |
Liquidation Proceeds | S-230 | Outside Controlling Class Representative | S-112 | |
Loan Combination | S-109 | Outside Controlling Note Holder | S-110 | |
Loan Combination Custodial Account | S-291 | Outside Operating Advisor | S-112 | |
Loan Per Unit | S-116 | Outside Securitization | S-111 | |
Lower-Tier Distribution Account | S-291 | Outside Serviced Companion Loan | S-111 | |
Lower-Tier Regular Interests | S-342 | Outside Serviced Loan Combination | S-111 | |
Lower-Tier REMIC | S-342 | Outside Serviced Mortgage Loan | S-111 | |
LTV Ratio at Maturity/ARD | S-116 | Outside Servicer | S-112 | |
LUST | S-133 | Outside Servicing Agreement | S-111 | |
MAI | S-261, E-1-13 | Outside Special Servicer | S-112 | |
Major Decision | S-315 | Outside Trustee | S-112 | |
MAS | S-10 | P&I | S-219 | |
Master Servicer | S-218 | P&I Advance | S-287 | |
Master Servicer Remittance Date | S-287 | Pari PassuCompanion Loan | S-109 | |
Material Breach | S-176 | Pari Passu Indemnified Items | S-298 | |
Material Document Defect | S-176 | Pari Passu Indemnified Parties | S-298 | |
Maturity Date/ARD Loan-to-Value Ratio | S-116 | Pari PassuLoan Combination | S-109 | |
Maturity Date/ARD LTV Ratio | S-116 | Participants | S-265 | |
Midland | S-224 | Pass-Through Rate | S-248 | |
Modeling Assumptions | S-272 | PCIS Persons | S-8 | |
Modification Fees | S-227 | PCO | S-149 | |
Monthly Payment | S-246 | PCR | S-196, S-201 | |
Moody’s | S-213 | Penalty Charges | S-227 | |
Morningstar | S-220 | Pentalpha Surveillance | S-217 | |
Mortgage | S-109 | Percentage Interest | S-245 | |
Mortgage File | S-174 | Permitted Encumbrances | E-1-2 | |
Mortgage Loan Purchase Agreement | S-173 | Permitted Special Servicer/Affiliate Fees | S-231 | |
Mortgage Loan Rate | S-249 | PILOT | S-89 | |
Mortgage Loan Schedule | S-282 | PIPs | S-85, S-135 | |
Mortgage Loans | S-109 | Plaintiff Investors | S-212 | |
Mortgage Note | S-109 | Plan Asset Regulations | S-346 | |
Mortgage Pool | S-109 | Plans | S-346 | |
Mortgaged Property | S-109 | PML | S-201 | |
Mortgagee | E-1-13 | Pooling and Servicing Agreement | S-113, S-281 | |
Most Recent NOI | S-117 | PPA | S-219 | |
Net Cash Flow | S-119 | Prepayment Assumption | S-344 | |
Net Condemnation Proceeds | S-247 | Prepayment Interest Excess | S-258 | |
Net Mortgage Loan Rate | S-248 | Prepayment Interest Shortfall | S-258 | |
Non-Recoverable Advance | S-288 | Prepayment Penalty Description | S-118 | |
Non-Reduced Certificates | S-264 | Prepayment Provision | S-118 | |
Notional Amount | S-243 | Prime Rate | S-288 | |
NPL | S-134 | Principal Balance Certificates | S-242 | |
NRSRO | S-350 | Principal Distribution Amount | S-249 | |
NY Derivative Action | S-212 | Principal Shortfall | S-250 | |
Occupancy | S-118 | Privileged Information | S-322 | |
Occupancy Date | S-118 | Privileged Information Exception | S-322 | |
Offered Certificates | S-241 | Privileged Person | S-334 | |
Offered Regular Certificates | S-241 | Professional Investors | S-10 | |
OID Regulations | S-343 | Promotion of Collective Investment Schemes | ||
OLA | S-94 | Exemptions Order | S-8 | |
Operating Advisor | S-217 | Property Advances | S-287 | |
Operating Advisor Consulting Fee | S-231 | Prospectus | S-10 | |
Operating Advisor Fee | S-231 | Prospectus Directive | S-9 | |
Operating Advisor Fee Rate | S-231 | PTE | S-346 | |
Operating Advisor Standard | S-322 | Public Documents | S-332 | |
Operating Advisor Termination Event | S-324 | Qualification Criteria | S-187, S-192 | |
Original Balance | S-118 | Qualified Investor | S-9 |
S-359 |
Qualified Investors | S-9 | Serviced Companion Loan | S-109 | |
Qualified Substitute Mortgage Loan | S-176 | Serviced Companion Loan Holder | S-109 | |
RAIT | S-113, S-188 | Serviced Companion Loan Securities | S-300 | |
RAIT Data Tape | S-189 | Serviced Loan Combination | S-109 | |
RAIT Mortgage Loans | S-113 | Serviced Loans | S-112 | |
RAIT Partnership | S-188 | Serviced Mortgage Loans | S-112 | |
RAIT Securitization Team | S-189 | Serviced Outside Controlled Companion | ||
Rated Final Distribution Date | S-178 | Loan | S-109 | |
Rating Agencies | S-353 | Serviced Outside Controlled Loan | ||
Rating Agency | S-353 | Combination | S-109 | |
Rating Agency Confirmation | S-328 | Serviced Outside Controlled Mortgage Loan | S-109 | |
Rating Agency Declination | S-329 | Serviced Pari PassuCompanion Loan | S-109 | |
Realized Loss | S-257 | Serviced Pari Passu Companion Loan Holder | S-109 | |
REC | S-132 | Serviced Pari PassuLoan Combination | S-109 | |
Recognized Collective Investment Scheme | S-8 | Serviced Subordinate Companion Loan | S-109 | |
Record Date | S-245 | Serviced Subordinate Companion Loan | ||
Regular Certificates | S-241 | Holder | S-109 | |
Regulation AB | S-173 | Servicer Termination Events | S-299 | |
Related Group | S-118 | Servicing Fee | S-226 | |
Release Date | S-155 | Servicing Fee Rate | S-226 | |
Release Parcel | S-159 | Servicing Function Participant | S-297 | |
Relevant Member State | S-9 | Servicing Standard | S-283 | |
Relevant Person | S-10 | Servicing Transfer Event | S-284 | |
Relevant Persons | S-8 | SFA | S-10 | |
REMIC | S-342 | Similar Law | S-349 | |
REO Account | S-241 | Similar Requirements | S-70 | |
REO Companion Loan | S-250 | Single-Purpose Entity | E-1-9 | |
REO Mortgage Loan | S-250 | Soft Lockbox | S-118 | |
REO Property | S-241 | Soft Springing Lockbox | S-118 | |
Repurchase Price | S-175 | Special Servicer | S-221 | |
Requesting Holders | S-263 | Special Servicing Fee | S-228 | |
Requesting Party | S-327 | Special Servicing Fee Rate | S-228 | |
Restricted Group | S-347 | Specially Serviced Loan | S-284 | |
Restricted Party | S-322 | Split Mortgage Loan | S-109 | |
Retention Requirement | S-69 | Sponsors | S-113 | |
Revised Rate | S-152 | Springing Cash Management | S-118 | |
RevPAR | S-118 | Springing Lockbox | S-118 | |
RFT | S-174 | SSM | S-145 | |
Rialto | S-113, S-186 | SSM Purchase Option | S-146 | |
Rialto Data Tape | S-187 | SSM ROFR | S-146 | |
Rialto Mortgage Loans | S-113, S-186 | Standard Qualifications | E-1-1 | |
Rialto Review Team | S-186 | Stated Principal Balance | S-249 | |
Risk Factors | S-6 | Structured Product | S-10 | |
RMBS | S-212 | Subject Holders | S-317 | |
Rooms | S-120 | SubordinateCompanion Loan | S-109 | |
Rule 17g-5 | S-304 | Summary | S-6 | |
Rules | S-267 | TCO | S-149 | |
S&P | S-220 | Terms and Conditions | S-267 | |
SDNY Action | S-212 | Terrorism Cap Amount | E-1-8 | |
Sears | S-145 | Third Party Report | S-113 | |
SEC | S-178 | TIA | S-305 | |
SEC EDGAR filings | S-332 | TIA Applicability Determination | S-305 | |
Securities Act | S-173, S-335 | Title Exception | E-1-2 | |
SEL | S-201, E-1-5 | Title Policy | E-1-2 | |
Selig Office Portfolio Companion Loan | S-110 | Torchlight | S-221 | |
Selig Office Portfolio Loan Combination | S-110 | Trailing 12 NOI | S-117 | |
Selig Office Portfolio Mortgage Loan | S-110 | Tranche Percentage Interest | S-244 | |
Sequential Pay Certificates | S-242 | TRIA | E-1-8 | |
Serviced AB Loan Combination | S-109 | TRIPRA | S-92 |
S-360 |
Trust Component | S-244 | Upper Tier Distribution Account | S-291 | |
Trust REMICs | S-342 | Upper-Tier REMIC | S-342 | |
Trustee | S-212 | UST | S-133 | |
Trustee/Certificate Administrator Fee | S-217 | Volcker Rule | S-70 | |
Trustee/Certificate Administrator Fee Rate | S-217 | Voting Rights | S-264 | |
Underwriter Entities | S-96 | WAC Rate | S-248 | |
Underwriter Exemption | S-346 | Wachovia | S-218 | |
Underwritten EGI | S-119 | Walgreens | S-145 | |
Underwritten Expenses | S-118 | Walmart | S-138 | |
Underwritten NCF | S-119 | Weighted Average Mortgage Loan Rate | S-120 | |
Underwritten NCF DSCR | S-116 | Wells Fargo | S-218 | |
Underwritten Net Cash Flow | S-119 | Withheld Amounts | S-291 | |
Underwritten Net Operating Income | S-119 | Workout Fee | S-228 | |
Underwritten NOI | S-119 | Workout Fee Rate | S-229 | |
Underwritten Revenues | S-119 | Workout-Delayed Reimbursement Amount | S-290 | |
Units | S-120 | YM Group A | S-254 | |
Unscheduled Payments | S-250 | YM Group B | S-254 | |
UPB | S-219 | YM Groups | S-254 | |
Updated Appraisal | S-306 | Zoning Regulations | E-1-7 |
S-361 |
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ANNEX A
STATISTICAL CHARACTERISTICS OF THE MORTGAGE LOANS
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CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Related Group | Crossed Group | Address | City | State | Zip Code | General Property Type | Detailed Property Type | |||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | NAP | NAP | 135 South LaSalle Street | Chicago | Illinois | 60604 | Office | CBD | ||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | NAP | NAP | |||||||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | 1000 Second Avenue | Seattle | Washington | 98104 | Office | CBD | |||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | 2901 Third Avenue | Seattle | Washington | 98121 | Office | CBD | |||||||||||||||||
2.03 | Property | 3101 Western Avenue | 3101 Western Avenue | Seattle | Washington | 98121 | Office | CBD | ||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | 300 Elliott Avenue West | Seattle | Washington | 98119 | Office | CBD | |||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | 3131 Elliott Avenue | Seattle | Washington | 98121 | Office | CBD | |||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | 2615 Fourth Avenue | Seattle | Washington | 98121 | Office | CBD | |||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | 190 Queen Anne Avenue North | Seattle | Washington | 98109 | Office | CBD | ||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | 200 First Avenue West | Seattle | Washington | 98119 | Office | CBD | |||||||||||||||||
2.09 | Property | 18 West Mercer Street | 18 West Mercer Street | Seattle | Washington | 98119 | Office | CBD | ||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | NAP | NAP | 2050 and 2100 North Stemmons Freeway | Dallas | Texas | 75207 | Mixed Use | Merchandise Mart/Retail | |||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | NAP | NAP | 150 South Los Robles Avenue | Pasadena | California | 91101 | Office | CBD | |||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | NAP | NAP | 13401 North Western Avenue | Oklahoma City | Oklahoma | 73114 | Office | Medical | |||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | NAP | NAP | |||||||||||||||||||
6.01 | Property | Highpointe Corporate Park | 9555, 9775 and 9885 Rockside Road | Valley View | Ohio | 44125 | Mixed Use | Office/Flex | ||||||||||||||||||
6.02 | Property | Rockside Business Pointe | 9700 and 9800 Rockside Road | Valley View | Ohio | 44125 | Mixed Use | Office/Flex | ||||||||||||||||||
6.03 | Property | 8 | Southport Center | 8333 Rockside Road | Valley View | Ohio | 44125 | Office | General Suburban | |||||||||||||||||
6.04 | Property | MRN III | 9445 and 9665 Rockside Road | Valley View | Ohio | 44125 | Office | General Suburban | ||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | NAP | NAP | 320 West Branch Avenue | Pine Hill | New Jersey | 08021 | Multifamily | Garden | ||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | NAP | NAP | 2 and 4 Theatre Square | Orinda | California | 94563 | Mixed Use | Retail/Office | |||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | NAP | NAP | 14015-14033 Southwest Freeway | Sugar Land | Texas | 77478 | Mixed Use | Retail/Office | |||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | NAP | NAP | 8915-9035 Mira Mesa Boulevard | San Diego | California | 92126 | Retail | Anchored | |||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | Group 1 | NAP | |||||||||||||||||||
11.01 | Property | Affordable Malta | 2353 Route 9 | Mechanicville | New York | 12118 | Self Storage | Self Storage | ||||||||||||||||||
11.02 | Property | A Space Place | 3220 Horseblock Road | Medford | New York | 11763 | Self Storage | Self Storage | ||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | 128 Dix Avenue | Glens Falls | New York | 12801 | Self Storage | Self Storage | ||||||||||||||||||
11.04 | Property | Snyders Best Rate | 1322 Loudon Road | Cohoes | New York | 12047 | Self Storage | Self Storage | ||||||||||||||||||
11.05 | Property | Affordable Wilton | 3 Commerce Park Drive | Wilton | New York | 12831 | Self Storage | Self Storage | ||||||||||||||||||
11.06 | Property | Rotterdam Secured | 130 Old Mill Lane | Rotterdam | New York | 12306 | Self Storage | Self Storage | ||||||||||||||||||
11.07 | Property | Affordable Saratoga | 655 Saratoga Road | Wilton | New York | 12831 | Self Storage | Self Storage | ||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | NAP | NAP | ||||||||||||||||||||
12.01 | Property | Walmart - Lawton | 3754 Southwest Lee Boulevard | Lawton | Oklahoma | 73505 | Retail | Single Tenant Retail | ||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | 4900 South Sooner Road | Oklahoma City | Oklahoma | 73135 | Retail | Single Tenant Retail | ||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | Group 2 | NAP | 3280 Tamiami Trail | Port Charlotte | Florida | 33952 | Retail | Anchored | |||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | NAP | NAP | 1636-1650 Wesel Boulevard | Hagerstown | Maryland | 21740 | Retail | Anchored | ||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | NAP | NAP | ||||||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | 3521 East Tudor Road and 4303 Florina Street | Anchorage | Alaska | 99507, 99508 | Self Storage | Self Storage | ||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | 3703 Woodland Drive | Anchorage | Alaska | 99517 | Self Storage | Self Storage | ||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | NAP | NAP | 3 Appletree Square | Bloomington | Minnesota | 55425 | Hospitality | Full Service | |||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | NAP | NAP | 1615 Howard Street | Omaha | Nebraska | 68102 | Hospitality | Full Service | |||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | NAP | NAP | 14495 Southwest Beef Bend Road | Tigard | Oregon | 97224 | Multifamily | Garden | ||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | NAP | NAP | 33321-33417 Temecula Parkway and 43810 Butterfield Stage Road | Temecula | California | 92592 | Retail | Anchored | |||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | NAP | NAP | 46-004 Kawa Street | Kaneohe | Hawaii | 96744 | Self Storage | Self Storage | ||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | NAP | NAP | 301 Coolidge Street | Lafayette | Louisiana | 70501 | Multifamily | Student Housing | ||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | NAP | NAP | 999 Ponce De Leon Boulevard | Coral Gables | Florida | 33134 | Office | CBD | ||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | NAP | NAP | 13180 Schavey Road | DeWitt | Michigan | 48820 | Multifamily | Garden | ||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | NAP | NAP | 40 Shippensburg Shopping Center | Shippensburg | Pennsylvania | 17257 | Retail | Anchored | |||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | NAP | NAP | 15232 Willisville Road | Houston | Texas | 77049 | Retail | Shadow Anchored | ||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | NAP | NAP | 7329 Carrie Lane | Deer Park | Texas | 77536 | Multifamily | Garden | ||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | NAP | NAP | 1815 North Boomer Road | Stillwater | Oklahoma | 74075 | Multifamily | Garden | |||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | NAP | NAP | 10500 Antenucci Boulevard | Garfield Heights | Ohio | 44125 | Office | General Suburban | |||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | NAP | NAP | 11091 Northwest 27th Street | Doral | Florida | 33172 | Industrial | Flex | ||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | NAP | NAP | 501 West 1st Street | Reno | Nevada | 89503 | Multifamily | Garden | ||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | NAP | NAP | 11701 College Boulevard | Overland Park | Kansas | 66210 | Retail | Unanchored | |||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | Group 1 | NAP | ||||||||||||||||||||
32.01 | Property | Cape May Court House Storage | 1005 South Route 9 | Cape May Court House | New Jersey | 08210 | Self Storage | Self Storage | ||||||||||||||||||
32.02 | Property | North Cape May Storage | 3414 Bayshore Road | North Cape May | New Jersey | 08204 | Self Storage | Self Storage | ||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | NAP | NAP | 5600 and 5700 Crooks Road | Troy | Michigan | 48098 | Office | General Suburban | |||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | NAP | NAP | 1 Eddie Dowling Highway | North Smithfield | Rhode Island | 02896 | Retail | Single Tenant Retail | ||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | NAP | NAP | ||||||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | 1081 and 1083 Harkins Road | Salinas | California | 93901 | Industrial | Warehouse/Distribution | ||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | 11145 and 11165 Commercial Parkway | Castroville | California | 95012 | Industrial | Warehouse/Distribution | |||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | 11285 Commercial Parkway | Castroville | California | 95012 | Industrial | Warehouse/Distribution | ||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | 11085 Commercial Parkway | Castroville | California | 95012 | Industrial | Warehouse/Distribution | ||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | 11325 Commercial Parkway | Castroville | California | 95012 | Industrial | Warehouse/Distribution | ||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | NAP | NAP | |||||||||||||||||||
36.01 | Property | Avondale Apartments | 200 First Street | Avondale | Pennsylvania | 19311 | Multifamily | Garden | ||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | 431 and 433 West Gay Street | West Chester | Pennsylvania | 19380 | Multifamily | Garden | |||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | Group 2 | NAP | 2900 Lakeland Highlands Road | Lakeland | Florida | 33803 | Retail | Anchored | |||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | NAP | NAP | 2801 South Brahma Boulevard | Kingsville | Texas | 78363 | Multifamily | Garden | ||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | NAP | NAP | 2125 Cloverdale Avenue | Winston-Salem | North Carolina | 27103 | Retail | Single Tenant Retail | ||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | NAP | NAP | 6785 Thomasville Road | Tallahassee | Florida | 32312 | Retail | Single Tenant Retail |
A-1 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Related Group | Crossed Group | Address | City | State | Zip Code | General Property Type | Detailed Property Type | |||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | NAP | NAP | 909 Gross Road and 1228 West Scyene Road | Mesquite | Texas | 75149 | Mixed Use | Retail/Office/Flex | ||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | NAP | NAP | �� | |||||||||||||||||||
42.01 | Property | Rite Aid - Manchester | 335 Center Street | Manchester | Connecticut | 06040 | Retail | Single Tenant Retail | ||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | 226 West Bridge Street | Catskill | New York | 12414 | Retail | Single Tenant Retail | ||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | NAP | NAP | 210 West Huron Street | Ann Arbor | Michigan | 48104 | Office | General Suburban | |||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | NAP | NAP | 5502 Kirkwood Boulevard Southwest | Cedar Rapids | Iowa | 52404 | Multifamily | Student Housing | ||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | NAP | NAP | 4381 Gwinnett Street | North Charleston | South Carolina | 29418 | Multifamily | Garden | ||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | NAP | NAP | 85 Pond Road | Eagle | Colorado | 81631 | Hospitality | Limited Service | |||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | NAP | NAP | 1216 and 1250 Mount Homer Road | Eustis | Florida | 32726 | Self Storage | Self Storage | |||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | NAP | NAP | 23325 Van Born Road | Taylor | Michigan | 48180 | Self Storage | Self Storage | ||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | NAP | NAP | 3001-3015 North Wooster Avenue | Dover | Ohio | 44622 | Retail | Anchored | |||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | Group 1 | NAP | 815 12th Street | Hammonton | New Jersey | 08037 | Self Storage | Self Storage |
A-2 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Year Built | Year Renovated | Units, Pads, Rooms, Sq Ft, Beds | Unit Description | Loan Per Unit ($) | Ownership Interest | Original Balance ($) | Cut-off Date Balance ($) | Allocated Cut-off Date Loan Amount ($) | % of Initial Pool Balance | |||||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 1934 | 2013-2014 | 1,310,047 | SF | 76.33 | Fee Simple | 100,000,000 | 100,000,000 | 100,000,000 | 13.8% | ||||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | 1,631,457 | SF | 211.47 | 72,000,000 | 72,000,000 | 72,000,000 | 9.95% | ||||||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | 1986 | NAP | 447,792 | SF | Fee Simple | 25,388,430 | |||||||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | 1982 | NAP | 269,862 | SF | Fee Simple | 10,842,975 | |||||||||||||||||||||
2.03 | Property | 3101 Western Avenue | 1984 | NAP | 187,035 | SF | Fee Simple | 9,123,967 | ||||||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | 1981 | NAP | 226,159 | SF | Fee Simple | 8,000,000 | |||||||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | 1986 | NAP | 189,849 | SF | Fee Simple | 7,867,769 | |||||||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | 1974 | NAP | 124,276 | SF | Fee Simple | 4,733,884 | |||||||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | 1974 | NAP | 84,582 | SF | Fee Simple | 2,790,083 | ||||||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | 1971 | NAP | 66,470 | SF | Fee Simple | 2,115,702 | |||||||||||||||||||||
2.09 | Property | 18 West Mercer Street | 1984 | NAP | 35,432 | SF | Fee Simple | 1,137,190 | ||||||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | 1959, 1974, 1978, 1984, 2007 | 2007 | 3,101,772 | SF | 83.27 | Fee Simple | 72,000,000 | 71,803,978 | 71,803,978 | 9.9% | |||||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 1970 | 2011 | 141,969 | SF | 295.84 | Fee Simple | 42,000,000 | 42,000,000 | 42,000,000 | 5.8% | |||||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | 2015 | NAP | 96,847 | SF | 309.03 | Fee Simple | 30,000,000 | 29,929,067 | 29,929,067 | 4.1% | |||||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | 389,949 | SF | 75.65 | 29,500,000 | 29,500,000 | 29,500,000 | 4.1% | ||||||||||||||||||
6.01 | Property | Highpointe Corporate Park | 1989, 1998 | NAP | 135,921 | SF | Fee Simple | 11,012,360 | ||||||||||||||||||||||
6.02 | Property | Rockside Business Pointe | 1986 | NAP | 115,918 | SF | Fee Simple | 7,475,278 | ||||||||||||||||||||||
6.03 | Property | 8 | Southport Center | 1991 | NAP | 93,993 | SF | Fee Simple | 7,365,884 | |||||||||||||||||||||
6.04 | Property | MRN III | 1998 | NAP | 44,117 | SF | Fee Simple | 3,646,478 | ||||||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | 1973 | 2012 | 484 | Units | 56,818.18 | Fee Simple | 27,500,000 | 27,500,000 | 27,500,000 | 3.8% | ||||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 1941 | 1989 | 90,537 | SF | 250.73 | Fee Simple | 22,700,000 | 22,700,000 | 22,700,000 | 3.1% | |||||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 1985 | NAP | 140,254 | SF | 161.85 | Fee Simple | 22,700,000 | 22,700,000 | 22,700,000 | 3.1% | |||||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | 1972-1975 | 2005 | 140,676 | SF | 157.81 | Fee Simple | 22,200,000 | 22,200,000 | 22,200,000 | 3.1% | |||||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | 235,069 | SF | 87.41 | 20,600,000 | 20,547,390 | 20,547,390 | 2.8% | ||||||||||||||||||
11.01 | Property | Affordable Malta | 2011 | NAP | 77,875 | SF | Fee Simple | 7,361,152 | ||||||||||||||||||||||
11.02 | Property | A Space Place | 1989, 2001 | NAP | 33,230 | SF | Fee Simple | 4,488,508 | ||||||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | 2002 | NAP | 39,200 | SF | Fee Simple | 2,802,824 | ||||||||||||||||||||||
11.04 | Property | Snyders Best Rate | 1997-2004 | NAP | 22,500 | SF | Fee Simple | 2,059,726 | ||||||||||||||||||||||
11.05 | Property | Affordable Wilton | 2004, 2009 | NAP | 29,100 | SF | Fee Simple | 1,964,969 | ||||||||||||||||||||||
11.06 | Property | Rotterdam Secured | 1980 | NAP | 20,064 | SF | Fee Simple | 947,574 | ||||||||||||||||||||||
11.07 | Property | Affordable Saratoga | 1996, 2000 | NAP | 13,100 | SF | Fee Simple | 922,638 | ||||||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | 82,234 | SF | 183.54 | 15,093,360 | 15,093,360 | 15,093,360 | 2.1% | |||||||||||||||||||
12.01 | Property | Walmart - Lawton | 2015 | NAP | 41,117 | SF | Fee Simple | 7,732,278 | ||||||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | 2015 | NAP | 41,117 | SF | Fee Simple | 7,361,082 | ||||||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 1978 | 2008 | 230,704 | SF | 63.28 | Fee Simple | 14,600,000 | 14,600,000 | 14,600,000 | 2.0% | |||||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 2005 | NAP | 75,080 | SF | 188.61 | Fee Simple | 14,200,000 | 14,160,573 | 14,160,573 | 2.0% | ||||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | 116,471 | SF | 107.02 | 12,500,000 | 12,464,974 | 12,464,974 | 1.7% | |||||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | 1998, 2007 | NAP | 79,918 | SF | Fee Simple | 9,830,595 | ||||||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | 1977 | NAP | 36,553 | SF | Fee Simple | 2,634,379 | ||||||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | 1981, 1986 | 2011 | 430 | Rooms | 60,652.19 | Fee Simple | 12,250,000 | 12,170,872 | 12,170,872 | 1.7% | |||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 1923 | 2007 | 145 | Rooms | 77,241.38 | Fee Simple | 11,200,000 | 11,200,000 | 11,200,000 | 1.5% | |||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | 1990 | 2014-2015 | 125 | Units | 85,600.00 | Fee Simple | 10,700,000 | 10,700,000 | 10,700,000 | 1.5% | ||||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | 2007 | NAP | 41,992 | SF | 240.52 | Fee Simple | 10,100,000 | 10,100,000 | 10,100,000 | 1.4% | |||||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | 2007 | NAP | 50,645 | SF | 177.71 | Fee Simple | 9,000,000 | 9,000,000 | 9,000,000 | 1.2% | ||||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | 2013 | NAP | 189 | Beds | 47,619.05 | Fee Simple | 9,000,000 | 9,000,000 | 9,000,000 | 1.2% | ||||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | 1981 | 2013 | 129,068 | SF | 69.63 | Fee Simple | 9,000,000 | 8,986,917 | 8,986,917 | 1.2% | ||||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | 1980 | NAP | 178 | Units | 44,241.57 | Fee Simple | 7,875,000 | 7,875,000 | 7,875,000 | 1.1% | ||||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | 1978 | 2014 | 131,812 | SF | 54.55 | Fee Simple | 7,200,000 | 7,190,169 | 7,190,169 | 1.0% | |||||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 2008 | NAP | 27,132 | SF | 244.18 | Fee Simple | 6,625,000 | 6,625,000 | 6,625,000 | 0.9% | ||||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | 1976 | NAP | 191 | Units | 33,507.85 | Fee Simple | 6,400,000 | 6,400,000 | 6,400,000 | 0.9% | ||||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | 1969 | 2014 | 300 | Units | 21,000.00 | Fee Simple | 6,300,000 | 6,300,000 | 6,300,000 | 0.9% | |||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 2001 | NAP | 93,277 | SF | 65.93 | Fee Simple | 6,150,000 | 6,150,000 | 6,150,000 | 0.9% | |||||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 1988 | NAP | 112,634 | SF | 53.27 | Fee Simple | 6,000,000 | 6,000,000 | 6,000,000 | 0.8% | ||||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | 1986 | 2005-2006 | 176 | Units | 33,522.73 | Fee Simple | 5,900,000 | 5,900,000 | 5,900,000 | 0.8% | ||||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 1985 | NAP | 45,786 | SF | 127.44 | Fee Simple | 5,835,000 | 5,835,000 | 5,835,000 | 0.8% | |||||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | 72,300 | SF | 76.42 | 5,525,000 | 5,525,000 | 5,525,000 | 0.8% | |||||||||||||||||||
32.01 | Property | Cape May Court House Storage | 1997 | NAP | 40,975 | SF | Fee Simple | 3,525,000 | ||||||||||||||||||||||
32.02 | Property | North Cape May Storage | 1991 | NAP | 31,325 | SF | Fee Simple | 2,000,000 | ||||||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 1972, 1976 | NAP | 232,992 | SF | 22.48 | Fee Simple | 5,250,000 | 5,237,304 | 5,237,304 | 0.7% | |||||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | 2015 | NAP | 14,559 | SF | 354.08 | Fee Simple | 5,155,000 | 5,155,000 | 5,155,000 | 0.7% | ||||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | 112,380 | SF | 44.49 | 5,000,000 | 5,000,000 | 5,000,000 | 0.7% | |||||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | 1980 | NAP | 29,660 | SF | Fee Simple | 1,338,639 | ||||||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | 1983 | NAP | 28,000 | SF | Fee Simple | 1,288,190 | |||||||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | 1990 | NAP | 21,600 | SF | Fee Simple | 896,576 | ||||||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | 1985 | NAP | 18,120 | SF | Fee Simple | 827,518 | ||||||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | 1988 | NAP | 15,000 | SF | Fee Simple | 649,077 | ||||||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | 63 | Units | 79,258.46 | 5,000,000 | 4,993,283 | 4,993,283 | 0.7% | ||||||||||||||||||
36.01 | Property | Avondale Apartments | 1968-1970 | NAP | 47 | Units | Fee Simple | 3,519,251 | ||||||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | 1900, 1988 | NAP | 16 | Units | Fee Simple | 1,474,032 | |||||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | 1989 | NAP | 102,572 | SF | 47.71 | Fee Simple | 4,900,000 | 4,893,641 | 4,893,641 | 0.7% | |||||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | 1982 | 2006 | 120 | Units | 39,166.67 | Fee Simple | 4,700,000 | 4,700,000 | 4,700,000 | 0.6% | ||||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | 2004 | NAP | 13,650 | SF | 331.02 | Fee Simple | 4,530,000 | 4,518,384 | 4,518,384 | 0.6% | ||||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | 2008 | NAP | 100,000 | SF | 42.89 | Fee Simple / Leasehold | 4,300,000 | 4,288,794 | 4,288,794 | 0.6% |
A-3 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Year Built | Year Renovated | Units, Pads, Rooms, Sq Ft, Beds | Unit Description | Loan Per Unit ($) | Ownership Interest | Original Balance ($) | Cut-off Date Balance ($) | Allocated Cut-off Date Loan Amount ($) | % of Initial Pool Balance | |||||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | 1984-1986 | NAP | 120,650 | SF | 32.28 | Fee Simple | 3,900,000 | 3,895,012 | 3,895,012 | 0.5% | ||||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | 22,257 | SF | 170.27 | 3,800,000 | 3,789,761 | 3,789,761 | 0.5% | |||||||||||||||||||
42.01 | Property | Rite Aid - Manchester | 1998 | NAP | 11,173 | SF | Fee Simple | 2,094,341 | ||||||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | 1997 | NAP | 11,084 | SF | Fee Simple | 1,695,419 | ||||||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | 2008 | NAP | 26,526 | SF | 138.54 | Fee Simple | 3,675,000 | 3,675,000 | 3,675,000 | 0.5% | |||||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | 1978 | NAP | 175 | Beds | 20,571.43 | Fee Simple | 3,600,000 | 3,600,000 | 3,600,000 | 0.5% | ||||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | 1976-1981 | NAP | 137 | Units | 24,774.07 | Fee Simple | 3,400,000 | 3,394,048 | 3,394,048 | 0.5% | ||||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 1998 | 2009-2011 | 54 | Rooms | 62,845.89 | Fee Simple | 3,400,000 | 3,393,678 | 3,393,678 | 0.5% | |||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | 1962, 1984, 1985, 2003, 2006 | NAP | 58,500 | SF | 54.70 | Fee Simple | 3,200,000 | 3,200,000 | 3,200,000 | 0.4% | |||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | 1998, 2002 | NAP | 38,710 | SF | 67.39 | Fee Simple | 2,615,000 | 2,608,650 | 2,608,650 | 0.4% | ||||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 1997 | NAP | 38,409 | SF | 64.41 | Fee Simple / Leasehold | 2,480,000 | 2,474,015 | 2,474,015 | 0.3% | |||||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | 2007 | NAP | 55,975 | SF | 41.98 | Fee Simple | 2,350,000 | 2,350,000 | 2,350,000 | 0.3% |
A-4 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Balloon Balance ($) | Mortgage Loan Rate (%) | Administrative Fee Rate (%) (1) | Net Mortgage Loan Rate (%) | Monthly Debt Service ($) (2) | Annual Debt Service ($) | Companion Loan Monthly Debt Service ($) | Companion Loan Annual Debt Service ($) | Amortization Type | Interest Accrual Method | |||||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 100,000,000 | 3.2950% | 0.0102% | 3.2848% | 278,396.99 | 3,340,763.88 | Interest Only - ARD | Actual/360 | ||||||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | 72,000,000 | 3.9085% | 0.0102% | 3.8983% | 237,767.08 | 2,853,204.96 | 901,533.53 | 10,818,402.33 | Interest Only | Actual/360 | |||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | |||||||||||||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | |||||||||||||||||||||||||||
2.03 | Property | 3101 Western Avenue | ||||||||||||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | |||||||||||||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | |||||||||||||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | |||||||||||||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | ||||||||||||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | |||||||||||||||||||||||||||
2.09 | Property | 18 West Mercer Street | ||||||||||||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | 57,405,491 | 4.0975% | 0.0152% | 4.0823% | 347,798.42 | 4,173,581.04 | 903,309.78 | 10,839,717.36 | Amortizing | Actual/360 | |||||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 39,026,225 | 4.1300% | 0.0102% | 4.1198% | 203,674.91 | 2,444,098.92 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | 24,508,012 | 3.9350% | 0.0102% | 3.9248% | 135,609.74 | 1,627,316.88 | Amortizing | Actual/360 | |||||||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | 25,728,163 | 4.3400% | 0.0402% | 4.2998% | 146,680.79 | 1,760,169.48 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
6.01 | Property | Highpointe Corporate Park | ||||||||||||||||||||||||||||
6.02 | Property | Rockside Business Pointe | ||||||||||||||||||||||||||||
6.03 | Property | 8 | Southport Center | |||||||||||||||||||||||||||
6.04 | Property | MRN III | ||||||||||||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | 25,128,074 | 4.4100% | 0.0102% | 4.3998% | 137,871.74 | 1,654,460.88 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 20,697,649 | 4.2790% | 0.0102% | 4.2688% | 112,056.08 | 1,344,672.96 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 19,180,186 | 4.1065% | 0.0102% | 4.0963% | 109,771.64 | 1,317,259.68 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | 22,200,000 | 3.9010% | 0.0102% | 3.8908% | 73,170.84 | 878,050.08 | Interest Only | Actual/360 | |||||||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | 16,612,359 | 4.4200% | 0.0102% | 4.4098% | 103,400.26 | 1,240,803.12 | Amortizing | Actual/360 | |||||||||||||||||
11.01 | Property | Affordable Malta | ||||||||||||||||||||||||||||
11.02 | Property | A Space Place | ||||||||||||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | �� | |||||||||||||||||||||||||||
11.04 | Property | Snyders Best Rate | ||||||||||||||||||||||||||||
11.05 | Property | Affordable Wilton | ||||||||||||||||||||||||||||
11.06 | Property | Rotterdam Secured | ||||||||||||||||||||||||||||
11.07 | Property | Affordable Saratoga | ||||||||||||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | 12,863,292 | 4.4200% | 0.0102% | 4.4098% | 75,760.06 | 909,120.72 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
12.01 | Property | Walmart - Lawton | ||||||||||||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | ||||||||||||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 12,496,231 | 4.5800% | 0.0102% | 4.5698% | 74,671.67 | 896,060.04 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 11,280,704 | 3.9970% | 0.0502% | 3.9468% | 67,768.41 | 813,220.92 | Amortizing | Actual/360 | ||||||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | 9,913,266 | 3.9500% | 0.0602% | 3.8898% | 59,317.15 | 711,805.80 | Amortizing | Actual/360 | ||||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | ||||||||||||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | ||||||||||||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | 9,954,111 | 4.6500% | 0.0102% | 4.6398% | 63,165.51 | 757,986.12 | 72,189.15 | 866,269.80 | Amortizing | Actual/360 | |||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 9,290,160 | 4.4100% | 0.0102% | 4.3998% | 56,151.40 | 673,816.80 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | 9,735,911 | 4.1540% | 0.0502% | 4.1038% | 52,037.96 | 624,455.52 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | 8,706,369 | 4.8500% | 0.0102% | 4.8398% | 53,296.87 | 639,562.44 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | 9,000,000 | 3.9300% | 0.0102% | 3.9198% | 29,884.38 | 358,612.56 | Interest Only | Actual/360 | ||||||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | 7,410,712 | 4.1730% | 0.0502% | 4.1228% | 43,869.83 | 526,437.96 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | 7,137,168 | 3.9500% | 0.0102% | 3.9398% | 42,708.35 | 512,500.20 | Amortizing | Actual/360 | ||||||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | 6,874,568 | 4.3800% | 0.0102% | 4.3698% | 39,341.94 | 472,103.28 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | 5,781,616 | 4.3000% | 0.0102% | 4.2898% | 35,630.74 | 427,568.88 | Amortizing | Actual/360 | |||||||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 5,765,644 | 4.2500% | 0.0102% | 4.2398% | 32,591.02 | 391,092.24 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | 5,577,756 | 4.3100% | 0.0102% | 4.2998% | 31,709.36 | 380,512.32 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | 5,351,922 | 4.3000% | 0.0777% | 4.2223% | 31,176.90 | 374,122.80 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 5,096,853 | 4.3800% | 0.0477% | 4.3323% | 30,724.18 | 368,690.16 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 5,094,050 | 4.2800% | 0.0102% | 4.2698% | 29,621.87 | 355,462.44 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | 5,371,801 | 4.1905% | 0.0777% | 4.1128% | 28,819.31 | 345,831.72 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 4,982,241 | 4.4900% | 0.0102% | 4.4798% | 29,530.43 | 354,365.16 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | 4,741,378 | 4.6800% | 0.0102% | 4.6698% | 28,588.36 | 343,060.32 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
32.01 | Property | Cape May Court House Storage | ||||||||||||||||||||||||||||
32.02 | Property | North Cape May Storage | ||||||||||||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 4,273,076 | 4.6900% | 0.0577% | 4.6323% | 27,196.94 | 326,363.28 | Amortizing | Actual/360 | |||||||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | 5,155,000 | 4.1400% | 0.0102% | 4.1298% | 18,031.76 | 216,381.12 | Interest Only | Actual/360 | ||||||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | 4,534,333 | 3.9570% | 0.0502% | 3.9068% | 23,746.98 | 284,963.76 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | ||||||||||||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | |||||||||||||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | ||||||||||||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | ||||||||||||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | ||||||||||||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | 4,027,666 | 4.3900% | 0.0102% | 4.3798% | 25,008.52 | 300,102.24 | Amortizing | Actual/360 | |||||||||||||||||
36.01 | Property | Avondale Apartments | ||||||||||||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | |||||||||||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | 3,973,054 | 4.5800% | 0.0102% | 4.5698% | 25,061.04 | 300,732.48 | Amortizing | Actual/360 | |||||||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | 3,992,703 | 4.3000% | 0.0777% | 4.2223% | 23,258.96 | 279,107.52 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | 3,650,567 | 4.4000% | 0.0777% | 4.3223% | 22,684.47 | 272,213.64 | Amortizing | Actual/360 | ||||||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | 2,644,112 | 4.4000% | 0.0102% | 4.3898% | 26,972.36 | 323,668.32 | Amortizing | Actual/360 |
A-5 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Balloon Balance ($) | Mortgage Loan Rate (%) | Administrative Fee Rate (%) (1) | Net Mortgage Loan Rate (%) | Monthly Debt Service ($) (2) | Annual Debt Service ($) | Companion Loan Monthly Debt Service ($) | Companion Loan Annual Debt Service ($) | Amortization Type | Interest Accrual Method | |||||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | 3,170,842 | 4.6600% | 0.0102% | 4.6498% | 20,133.22 | 241,598.64 | Amortizing | Actual/360 | ||||||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | 3,035,429 | 4.1500% | 0.0102% | 4.1398% | 18,471.93 | 221,663.16 | Amortizing | Actual/360 | ||||||||||||||||||
42.01 | Property | Rite Aid - Manchester | ||||||||||||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | ||||||||||||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | 3,214,125 | 4.4600% | 0.0102% | 4.4498% | 18,533.44 | 222,401.28 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | 3,065,606 | 4.3900% | 0.0577% | 4.3323% | 18,006.13 | 216,073.56 | Interest Only, Then Amortizing | Actual/360 | ||||||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | 2,516,472 | 4.7200% | 0.0102% | 4.7098% | 19,325.37 | 231,904.44 | Amortizing | Actual/360 | ||||||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 2,477,677 | 4.3100% | 0.0102% | 4.2998% | 18,533.51 | 222,402.12 | Amortizing | Actual/360 | |||||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | 2,660,040 | 4.4800% | 0.0102% | 4.4698% | 16,175.92 | 194,111.04 | Interest Only, Then Amortizing | Actual/360 | |||||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | 2,298,256 | 4.6700% | 0.0602% | 4.6098% | 13,515.27 | 162,183.24 | Amortizing | Actual/360 | ||||||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 2,019,201 | 4.7000% | 0.0602% | 4.6398% | 12,862.22 | 154,346.64 | Amortizing | Actual/360 | |||||||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | 2,021,441 | 4.7700% | 0.0102% | 4.7598% | 12,287.06 | 147,444.72 | Interest Only, Then Amortizing | Actual/360 |
A-6 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Seasoning | Original Interest-Only Period (Mos.) | Remaining Interest- Only Period (Mos.) | Original Term To Maturity / ARD (Mos.) | Remaining Term To Maturity / ARD (Mos.) | Original Amortization Term (Mos.) | Remaining Amortization Term (Mos.) | Origination Date | Due Date | First Due Date | Last IO Due Date | First P&I Due Date | |||||||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 2 | 120 | 118 | 120 | 118 | 0 | 0 | 5/1/2015 | 6 | 6/6/2015 | 5/6/2025 | |||||||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | 3 | 120 | 117 | 120 | 117 | 0 | 0 | 3/19/2015 | 6 | 5/6/2015 | 4/6/2025 | ||||||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | |||||||||||||||||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | |||||||||||||||||||||||||||||||
2.03 | Property | 3101 Western Avenue | ||||||||||||||||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | |||||||||||||||||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | |||||||||||||||||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | |||||||||||||||||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | ||||||||||||||||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | |||||||||||||||||||||||||||||||
2.09 | Property | 18 West Mercer Street | ||||||||||||||||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | 2 | 0 | 0 | 120 | 118 | 360 | 358 | 4/29/2015 | 6 | 6/6/2015 | 6/6/2015 | ||||||||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 1 | 72 | 71 | 120 | 119 | 360 | 360 | 5/28/2015 | 6 | 7/6/2015 | 6/6/2021 | 7/6/2021 | |||||||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | 2 | 0 | 0 | 120 | 118 | 360 | 358 | 4/3/2015 | 1 | 6/1/2015 | 6/1/2015 | ||||||||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | 1 | 36 | 35 | 120 | 119 | 360 | 360 | 5/7/2015 | 6 | 7/6/2015 | 6/6/2018 | 7/6/2018 | |||||||||||||||||
6.01 | Property | Highpointe Corporate Park | ||||||||||||||||||||||||||||||||
6.02 | Property | Rockside Business Pointe | ||||||||||||||||||||||||||||||||
6.03 | Property | 8 | Southport Center | |||||||||||||||||||||||||||||||
6.04 | Property | MRN III | ||||||||||||||||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | 1 | 60 | 59 | 120 | 119 | 360 | 360 | 5/21/2015 | 6 | 7/6/2015 | 6/6/2020 | 7/6/2020 | ||||||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 1 | 60 | 59 | 120 | 119 | 360 | 360 | 5/15/2015 | 6 | 7/6/2015 | 6/6/2020 | 7/6/2020 | |||||||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 1 | 24 | 23 | 120 | 119 | 360 | 360 | 5/29/2015 | 6 | 7/6/2015 | 6/6/2017 | 7/6/2017 | |||||||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | 1 | 120 | 119 | 120 | 119 | 0 | 0 | 5/8/2015 | 6 | 7/6/2015 | 6/6/2025 | ||||||||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | 2 | 0 | 0 | 120 | 118 | 360 | 358 | 4/30/2015 | 6 | 6/6/2015 | 6/6/2015 | ||||||||||||||||||
11.01 | Property | Affordable Malta | ||||||||||||||||||||||||||||||||
11.02 | Property | A Space Place | ||||||||||||||||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | ||||||||||||||||||||||||||||||||
11.04 | Property | Snyders Best Rate | ||||||||||||||||||||||||||||||||
11.05 | Property | Affordable Wilton | ||||||||||||||||||||||||||||||||
11.06 | Property | Rotterdam Secured | ||||||||||||||||||||||||||||||||
11.07 | Property | Affordable Saratoga | ||||||||||||||||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | 1 | 24 | 23 | 120 | 119 | 360 | 360 | 5/12/2015 | 6 | 7/6/2015 | 6/6/2017 | 7/6/2017 | ||||||||||||||||||
12.01 | Property | Walmart - Lawton | ||||||||||||||||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | ||||||||||||||||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 1 | 24 | 23 | 120 | 119 | 360 | 360 | 5/21/2015 | 6 | 7/6/2015 | 6/6/2017 | 7/6/2017 | |||||||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 2 | 0 | 0 | 120 | 118 | 360 | 358 | 5/1/2015 | 6 | 6/6/2015 | 6/6/2015 | |||||||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | 2 | 0 | 0 | 120 | 118 | 360 | 358 | 4/22/2015 | 6 | 6/6/2015 | 6/6/2015 | |||||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | ||||||||||||||||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | ||||||||||||||||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | 5 | 0 | 0 | 120 | 115 | 360 | 355 | 1/20/2015 | 6 | 3/6/2015 | 3/6/2015 | ||||||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 1 | 12 | 11 | 120 | 119 | 360 | 360 | 5/21/2015 | 6 | 7/6/2015 | 6/6/2016 | 7/6/2016 | |||||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | 1 | 60 | 59 | 120 | 119 | 360 | 360 | 5/29/2015 | 6 | 7/6/2015 | 6/6/2020 | 7/6/2020 | ||||||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | 2 | 24 | 22 | 120 | 118 | 360 | 360 | 4/30/2015 | 6 | 6/6/2015 | 5/6/2017 | 6/6/2017 | |||||||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | 1 | 120 | 119 | 120 | 119 | 0 | 0 | 5/27/2015 | 6 | 7/6/2015 | 6/6/2025 | |||||||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | 2 | 12 | 10 | 120 | 118 | 360 | 360 | 4/30/2015 | 6 | 6/6/2015 | 5/6/2016 | 6/6/2016 | ||||||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | 1 | 0 | 0 | 120 | 119 | 360 | 359 | 5/8/2015 | 6 | 7/6/2015 | 7/6/2015 | |||||||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | 1 | 36 | 35 | 120 | 119 | 360 | 360 | 5/26/2015 | 6 | 7/6/2015 | 6/6/2018 | 7/6/2018 | ||||||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | 1 | 0 | 0 | 120 | 119 | 360 | 359 | 5/22/2015 | 1 | 7/1/2015 | 7/1/2015 | ||||||||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 1 | 36 | 35 | 120 | 119 | 360 | 360 | 5/15/2015 | 6 | 7/6/2015 | 6/6/2018 | 7/6/2018 | ||||||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | 1 | 36 | 35 | 120 | 119 | 360 | 360 | 6/1/2015 | 6 | 7/6/2015 | 6/6/2018 | 7/6/2018 | ||||||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | 2 | 24 | 22 | 120 | 118 | 360 | 360 | 4/28/2015 | 6 | 6/6/2015 | 5/6/2017 | 6/6/2017 | |||||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 2 | 12 | 10 | 120 | 118 | 360 | 360 | 4/16/2015 | 6 | 6/6/2015 | 5/6/2016 | 6/6/2016 | |||||||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 1 | 24 | 23 | 120 | 119 | 360 | 360 | 5/7/2015 | 1 | 7/1/2015 | 6/1/2017 | 7/1/2017 | ||||||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | 2 | 60 | 58 | 120 | 118 | 360 | 360 | 4/30/2015 | 6 | 6/6/2015 | 5/6/2020 | 6/6/2020 | ||||||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 1 | 24 | 23 | 120 | 119 | 360 | 360 | 6/1/2015 | 6 | 7/6/2015 | 6/6/2017 | 7/6/2017 | |||||||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | 1 | 24 | 23 | 120 | 119 | 360 | 360 | 5/29/2015 | 6 | 7/6/2015 | 6/6/2017 | 7/6/2017 | ||||||||||||||||||
32.01 | Property | Cape May Court House Storage | ||||||||||||||||||||||||||||||||
32.02 | Property | North Cape May Storage | ||||||||||||||||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 2 | 0 | 0 | 120 | 118 | 360 | 358 | 4/30/2015 | 6 | 6/6/2015 | 6/6/2015 | ||||||||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | 1 | 120 | 119 | 120 | 119 | 0 | 0 | 5/12/2015 | 1 | 7/1/2015 | 6/1/2025 | |||||||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | 1 | 60 | 59 | 120 | 119 | 360 | 360 | 5/29/2015 | 6 | 7/6/2015 | 6/6/2020 | 7/6/2020 | ||||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | ||||||||||||||||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | |||||||||||||||||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | ||||||||||||||||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | ||||||||||||||||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | ||||||||||||||||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | 1 | 0 | 0 | 120 | 119 | 360 | 359 | 5/27/2015 | 6 | 7/6/2015 | 7/6/2015 | ||||||||||||||||||
36.01 | Property | Avondale Apartments | ||||||||||||||||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | |||||||||||||||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | 1 | 0 | 0 | 120 | 119 | 360 | 359 | 5/22/2015 | 6 | 7/6/2015 | 7/6/2015 | ||||||||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | 2 | 24 | 22 | 120 | 118 | 360 | 360 | 4/27/2015 | 6 | 6/6/2015 | 5/6/2017 | 6/6/2017 | ||||||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | 2 | 0 | 0 | 120 | 118 | 360 | 358 | 5/1/2015 | 6 | 6/6/2015 | 6/6/2015 | |||||||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | 1 | 0 | 0 | 120 | 119 | 240 | 239 | 5/21/2015 | 6 | 7/6/2015 | 7/6/2015 |
A-7 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Seasoning | Original Interest-Only Period (Mos.) | Remaining Interest- Only Period (Mos.) | Original Term To Maturity / ARD (Mos.) | Remaining Term To Maturity / ARD (Mos.) | Original Amortization Term (Mos.) | Remaining Amortization Term (Mos.) | Origination Date | Due Date | First Due Date | Last IO Due Date | First P&I Due Date | |||||||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | 1 | 0 | 0 | 120 | 119 | 360 | 359 | 5/11/2015 | 1 | 7/1/2015 | 7/1/2015 | |||||||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | 2 | 0 | 0 | 120 | 118 | 360 | 358 | 4/29/2015 | 6 | 6/6/2015 | 6/6/2015 | |||||||||||||||||||
42.01 | Property | Rite Aid - Manchester | ||||||||||||||||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | ||||||||||||||||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | 1 | 36 | 35 | 120 | 119 | 360 | 360 | 5/15/2015 | 6 | 7/6/2015 | 6/6/2018 | 7/6/2018 | |||||||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | 1 | 24 | 23 | 120 | 119 | 360 | 360 | 5/8/2015 | 6 | 7/6/2015 | 6/6/2017 | 7/6/2017 | ||||||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | 1 | 0 | 0 | 120 | 119 | 300 | 299 | 5/21/2015 | 1 | 7/1/2015 | 7/1/2015 | |||||||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 1 | 0 | 0 | 120 | 119 | 300 | 299 | 5/8/2015 | 6 | 7/6/2015 | 7/6/2015 | ||||||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | 1 | 12 | 11 | 120 | 119 | 360 | 360 | 5/22/2015 | 6 | 7/6/2015 | 6/6/2016 | 7/6/2016 | |||||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | 2 | 0 | 0 | 84 | 82 | 360 | 358 | 4/10/2015 | 6 | 6/6/2015 | 6/6/2015 | |||||||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 2 | 0 | 0 | 120 | 118 | 360 | 358 | 5/1/2015 | 6 | 6/6/2015 | 6/6/2015 | ||||||||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | 1 | 24 | 23 | 120 | 119 | 360 | 360 | 5/22/2015 | 6 | 7/6/2015 | 6/6/2017 | 7/6/2017 |
A-8 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Maturity Date / ARD | ARD (Yes / No) | Final Maturity Date | Grace Period- Late Fee | Grace Period- Default | Prepayment Provision (3) | 2012 EGI ($) | 2012 Expenses ($) | |||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 5/6/2025 | Yes | 5/6/2030 | 0 | 0 | Lockout/26_Defeasance/89_0%/5 | 32,547,447 | 17,730,315 | ||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | 4/6/2025 | No | 0 | 0 | Lockout/27_Defeasance/89_0%/4 | 39,509,460 | 12,267,650 | ||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | 13,324,992 | 3,969,000 | |||||||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | 7,572,447 | 1,808,766 | |||||||||||||||||||||
2.03 | Property | 3101 Western Avenue | 2,366,959 | 1,206,845 | ||||||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | 5,272,702 | 1,555,687 | |||||||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | 5,016,763 | 1,645,380 | |||||||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | 2,701,086 | 853,133 | |||||||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | 1,392,503 | 570,004 | ||||||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | 1,052,643 | 357,682 | |||||||||||||||||||||
2.09 | Property | 18 West Mercer Street | 809,365 | 301,152 | ||||||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | 5/6/2025 | No | 5 days grace, one time only | 5 days grace, one time only | Lockout/26_Defeasance/90_0%/4 | 61,705,096 | 30,976,915 | ||||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 6/6/2025 | No | 0 | 0 | Lockout/25_>YM or 1%/90_0%/5 | 4,627,474 | 1,490,461 | ||||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | 5/1/2025 | No | 5 | 5 | Lockout/26_Defeasance/90_0%/4 | N/A | N/A | ||||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/92_0%/3 | 4,368,769 | 1,616,033 | ||||||||||||||
6.01 | Property | Highpointe Corporate Park | 1,623,641 | 533,811 | ||||||||||||||||||||||
6.02 | Property | Rockside Business Pointe | 982,051 | 439,788 | ||||||||||||||||||||||
6.03 | Property | 8 | Southport Center | 1,105,593 | 502,899 | |||||||||||||||||||||
6.04 | Property | MRN III | 657,484 | 139,535 | ||||||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 3,432,697 | 1,743,247 | |||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 2,954,119 | 1,240,118 | ||||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 2,466,175 | 784,835 | ||||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | 6/6/2025 | No | 0 | 0 | Lockout/11_>YM or 1%/105_0%/4 | 3,310,707 | 869,382 | ||||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/90_0%/4 | 2,383,437 | 711,853 | ||||||||||||||
11.01 | Property | Affordable Malta | 729,944 | 202,512 | ||||||||||||||||||||||
11.02 | Property | A Space Place | 564,837 | 153,697 | ||||||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | 343,775 | 99,035 | ||||||||||||||||||||||
11.04 | Property | Snyders Best Rate | 224,556 | 56,189 | ||||||||||||||||||||||
11.05 | Property | Affordable Wilton | 221,608 | 59,680 | ||||||||||||||||||||||
11.06 | Property | Rotterdam Secured | 167,740 | 93,093 | ||||||||||||||||||||||
11.07 | Property | Affordable Saratoga | 130,977 | 47,647 | ||||||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/92_0%/3 | N/A | N/A | |||||||||||||||
12.01 | Property | Walmart - Lawton | N/A | N/A | ||||||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | N/A | N/A | ||||||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 6/6/2025 | No | 0 | 0 | Lockout/23_>YM or 1%/93_0%/4 | 2,213,513 | 747,828 | ||||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 5/6/2025 | No | 0 | 0 | Lockout/23_>YM or 1%/93_0%/4 | 1,766,428 | 437,966 | |||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/91_0%/3 | 2,127,281 | 690,023 | |||||||||||||||
15.01 | Property | Best Storage-Tudor Road | 1,616,036 | 510,797 | ||||||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | 511,245 | 179,226 | ||||||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | 2/6/2025 | No | 0 | 0 | Lockout/29_Defeasance/89_0%/2 | 13,981,032 | 10,794,363 | ||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/88_0%/7 | 5,779,058 | 4,394,384 | ||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 1,279,642 | 592,655 | |||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/90_0%/4 | 1,272,962 | 298,795 | ||||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 1,475,178 | 514,605 | |||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/90_0%/4 | N/A | N/A | |||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/92_0%/3 | N/A | N/A | |||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 1,280,092 | 737,239 | |||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | 6/1/2025 | No | 5 | 5 | Lockout/25_Defeasance/91_0%/4 | N/A | N/A | ||||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/92_0%/3 | 1,089,920 | 341,410 | |||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 1,576,556 | 1,050,657 | |||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/91_0%/3 | N/A | N/A | ||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/90_0%/4 | N/A | N/A | ||||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 6/1/2025 | No | 5 | 5 | Lockout/25_Defeasance/91_0%/4 | 901,512 | 303,689 | |||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/87_0%/7 | 1,135,348 | 650,043 | |||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 789,356 | 307,925 | ||||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 776,947 | 204,567 | |||||||||||||||
32.01 | Property | Cape May Court House Storage | 482,421 | 119,772 | ||||||||||||||||||||||
32.02 | Property | North Cape May Storage | 294,526 | 84,795 | ||||||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/90_0%/4 | 2,325,873 | 1,564,349 | ||||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | 6/1/2025 | No | 5 | 5 | Lockout/25_Defeasance/91_0%/4 | N/A | N/A | |||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/90_0%/5 | 951,602 | 154,613 | |||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | N/A | N/A | ||||||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | N/A | N/A | |||||||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | N/A | N/A | ||||||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | N/A | N/A | ||||||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | N/A | N/A | ||||||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/92_0%/3 | 752,762 | 269,549 | ||||||||||||||
36.01 | Property | Avondale Apartments | 554,716 | 204,758 | ||||||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | 198,046 | 64,791 | |||||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | N/A | N/A | ||||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/91_0%/3 | 992,376 | 496,390 | |||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/91_0%/3 | 379,800 | N/A | |||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/92_0%/3 | 648,022 | 274,297 |
A-9 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Maturity Date / ARD | ARD (Yes / No) | Final Maturity Date | Grace Period- Late Fee | Grace Period- Default | Prepayment Provision (3) | 2012 EGI ($) | 2012 Expenses ($) | |||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | 6/1/2025 | No | 5 | 5 | Lockout/25_Defeasance/91_0%/4 | 652,358 | 280,381 | |||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/90_0%/4 | 451,372 | N/A | |||||||||||||||
42.01 | Property | Rite Aid - Manchester | 249,000 | N/A | ||||||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | 202,372 | N/A | ||||||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | N/A | N/A | ||||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 778,244 | 411,426 | |||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | 6/1/2025 | No | 5 | 5 | Lockout/25_Defeasance/91_0%/4 | 746,711 | 484,785 | |||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 1,244,060 | 785,109 | ||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | 6/6/2025 | No | 0 | 0 | Lockout/23_>YM or 1%/93_0%/4 | 284,788 | 98,370 | ||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | 5/6/2022 | No | 0 | 0 | Lockout/26_>YM or 1%/52_0%/6 | 505,564 | 212,582 | |||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 5/6/2025 | No | 0 | 0 | Lockout/26_Defeasance/91_0%/3 | 455,430 | 124,802 | ||||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | 6/6/2025 | No | 0 | 0 | Lockout/25_Defeasance/91_0%/4 | 347,121 | 110,719 |
A-10 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | 2012 NOI ($) | 2013 EGI ($) | 2013 Expenses ($) | 2013 NOI ($) | 2014 EGI ($) | 2014 Expenses ($) | 2014 NOI ($) | Most Recent EGI (if past 2014) ($) | Most Recent Expenses (if past 2014) ($) | Most Recent NOI (if past 2014) ($) | |||||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 14,817,132 | 34,634,834 | 18,909,488 | 15,725,346 | 36,661,890 | 19,469,924 | 17,191,966 | 36,268,868 | 19,668,628 | 16,600,240 | ||||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | 27,241,810 | 43,169,757 | 12,489,151 | 30,680,606 | 43,943,344 | 12,835,713 | 31,107,630 | 44,081,390 | 12,810,605 | 31,270,786 | |||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | 9,355,992 | 13,797,754 | 4,095,615 | 9,702,139 | 14,046,111 | 4,080,341 | 9,965,770 | 14,150,092 | 4,073,715 | 10,076,377 | |||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | 5,763,681 | 7,755,750 | 1,843,866 | 5,911,884 | 7,740,134 | 1,936,169 | 5,803,964 | 7,714,978 | 1,923,295 | 5,791,683 | |||||||||||||||||
2.03 | Property | 3101 Western Avenue | 1,160,114 | 4,753,342 | 1,289,419 | 3,463,923 | 5,283,281 | 1,433,799 | 3,849,482 | 5,292,550 | 1,453,153 | 3,839,397 | ||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | 3,717,015 | 5,392,337 | 1,614,432 | 3,777,905 | 5,407,266 | 1,588,142 | 3,819,124 | 5,408,484 | 1,579,312 | 3,829,172 | |||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | 3,371,383 | 5,195,912 | 1,711,407 | 3,484,505 | 5,128,485 | 1,701,790 | 3,426,694 | 5,172,812 | 1,676,221 | 3,496,591 | |||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | 1,847,953 | 3,029,651 | 854,929 | 2,174,722 | 3,182,810 | 863,540 | 2,319,270 | 3,185,557 | 857,722 | 2,327,835 | |||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | 822,499 | 1,687,937 | 509,285 | 1,178,653 | 1,782,005 | 534,119 | 1,247,887 | 1,785,020 | 531,680 | 1,253,340 | ||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | 694,961 | 720,204 | 275,850 | 444,354 | 567,513 | 420,146 | 147,367 | 570,891 | 449,911 | 120,981 | |||||||||||||||||
2.09 | Property | 18 West Mercer Street | 508,213 | 836,869 | 294,348 | 542,520 | 805,740 | 277,668 | 528,072 | 801,006 | 265,596 | 535,410 | ||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | 30,728,181 | 62,837,850 | 31,005,176 | 31,832,674 | 64,714,008 | 31,529,354 | 33,184,654 | N/A | N/A | N/A | |||||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 3,137,013 | 4,618,529 | 1,642,892 | 2,975,637 | 4,776,448 | 1,419,188 | 3,357,260 | 4,894,766 | 1,575,114 | 3,319,652 | |||||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | 2,752,736 | 4,516,694 | 1,751,085 | 2,765,609 | 4,680,187 | 1,885,611 | 2,794,576 | N/A | N/A | N/A | |||||||||||||||
6.01 | Property | Highpointe Corporate Park | 1,089,830 | 1,691,406 | 511,921 | 1,179,485 | 1,655,542 | 532,072 | 1,123,470 | N/A | N/A | N/A | ||||||||||||||||||
6.02 | Property | Rockside Business Pointe | 542,263 | 1,097,141 | 490,097 | 607,044 | 1,104,585 | 527,397 | 577,188 | N/A | N/A | N/A | ||||||||||||||||||
6.03 | Property | 8 | Southport Center | 602,694 | 1,222,658 | 606,198 | 616,460 | 1,410,663 | 694,349 | 716,314 | N/A | N/A | N/A | |||||||||||||||||
6.04 | Property | MRN III | 517,948 | 505,489 | 142,869 | 362,620 | 509,397 | 131,794 | 377,603 | N/A | N/A | N/A | ||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | 1,689,449 | 3,959,757 | 1,654,907 | 2,304,850 | N/A | N/A | N/A | 4,684,132 | 2,239,029 | 2,445,103 | ||||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 1,714,001 | 3,455,553 | 1,297,826 | 2,157,727 | 3,278,087 | 1,369,331 | 1,908,755 | 3,285,174 | 1,353,708 | 1,931,466 | |||||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 1,681,340 | 2,512,942 | 731,450 | 1,781,492 | 2,697,728 | 765,838 | 1,931,891 | 2,603,733 | 803,622 | 1,800,111 | |||||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | 2,441,325 | 3,323,268 | 837,968 | 2,485,300 | 3,393,254 | 810,175 | 2,583,080 | N/A | N/A | N/A | |||||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | 1,671,584 | 2,547,564 | 758,668 | 1,788,896 | 2,714,028 | 785,228 | 1,928,800 | 2,765,223 | 765,109 | 2,000,114 | |||||||||||||||
11.01 | Property | Affordable Malta | 527,432 | 815,641 | 214,817 | 600,824 | 903,840 | 221,698 | 682,142 | 918,989 | 218,349 | 700,640 | ||||||||||||||||||
11.02 | Property | A Space Place | 411,140 | 582,090 | 165,087 | 417,003 | 598,361 | 171,161 | 427,200 | 607,850 | 167,092 | 440,758 | ||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | 244,740 | 359,988 | 102,795 | 257,193 | 373,310 | 108,176 | 265,134 | 384,492 | 106,600 | 277,892 | ||||||||||||||||||
11.04 | Property | Snyders Best Rate | 168,367 | 240,700 | 62,192 | 178,508 | 256,025 | 67,684 | 188,341 | 265,747 | 69,166 | 196,581 | ||||||||||||||||||
11.05 | Property | Affordable Wilton | 161,928 | 234,909 | 61,914 | 172,995 | 245,784 | 65,213 | 180,571 | 250,498 | 63,357 | 187,141 | ||||||||||||||||||
11.06 | Property | Rotterdam Secured | 74,647 | 176,843 | 100,531 | 76,312 | 191,476 | 96,603 | 94,873 | 191,979 | 86,944 | 105,035 | ||||||||||||||||||
11.07 | Property | Affordable Saratoga | 83,330 | 137,393 | 51,332 | 86,061 | 145,232 | 54,693 | 90,539 | 145,668 | 53,601 | 92,067 | ||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||
12.01 | Property | Walmart - Lawton | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 1,465,686 | 2,253,351 | 720,720 | 1,532,631 | 2,242,982 | 684,309 | 1,558,673 | 2,258,954 | 689,517 | 1,569,437 | |||||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 1,328,462 | 1,769,929 | 435,272 | 1,334,657 | 1,783,499 | 458,529 | 1,324,970 | 1,783,654 | 459,294 | 1,324,360 | ||||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | 1,437,258 | 2,074,268 | 704,632 | 1,369,636 | 2,089,281 | 703,213 | 1,386,068 | 2,109,305 | 703,477 | 1,405,828 | ||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | 1,105,239 | 1,555,184 | 521,832 | 1,033,352 | 1,586,318 | 517,669 | 1,068,649 | 1,600,714 | 513,314 | 1,087,400 | ||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | 332,019 | 519,084 | 182,800 | 336,284 | 502,963 | 185,544 | 317,419 | 508,591 | 190,163 | 318,428 | ||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | 3,186,669 | 14,306,936 | 11,649,225 | 2,657,711 | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 1,384,674 | 6,010,500 | 4,529,329 | 1,481,171 | 6,101,694 | 4,717,849 | 1,383,845 | 6,164,361 | 4,745,444 | 1,418,917 | |||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | 686,987 | 1,365,283 | 610,119 | 755,164 | 1,490,079 | 672,982 | 817,097 | 1,510,049 | 662,611 | 847,439 | ||||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | 974,167 | 1,275,755 | 328,389 | 947,366 | 1,164,733 | 318,354 | 846,379 | N/A | N/A | N/A | |||||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | 960,573 | 1,684,894 | 559,561 | 1,125,333 | 1,784,243 | 583,184 | 1,201,059 | 1,790,022 | 577,609 | 1,212,413 | ||||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | N/A | 1,283,075 | 484,990 | 798,085 | 1,356,358 | 630,370 | 725,988 | N/A | N/A | N/A | ||||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | N/A | 2,489,557 | 1,813,586 | 675,972 | 2,745,756 | 1,860,724 | 885,032 | N/A | N/A | N/A | ||||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | 542,853 | 1,347,397 | 626,330 | 721,067 | 1,425,177 | 698,835 | 726,342 | 1,432,973 | 746,219 | 686,754 | ||||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | N/A | 455,646 | 134,637 | 321,009 | 408,622 | 163,102 | 245,520 | 524,504 | 173,652 | 350,852 | |||||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 748,510 | 1,125,069 | 395,863 | 729,206 | 1,212,010 | 420,176 | 791,834 | 1,211,298 | 397,385 | 813,913 | ||||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | 525,899 | 1,581,205 | 981,876 | 599,329 | 1,740,280 | 1,116,404 | 623,876 | 1,772,028 | 1,137,447 | 634,581 | ||||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | N/A | 1,725,518 | 1,200,405 | 525,113 | 1,910,317 | 1,187,597 | 722,720 | 1,864,200 | 1,192,119 | 672,081 | |||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | N/A | 1,100,142 | 648,591 | 451,551 | 1,187,056 | 730,479 | 456,576 | 1,202,574 | 633,931 | 568,643 | |||||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 597,823 | 876,056 | 309,581 | 566,474 | 828,707 | 259,652 | 569,055 | 845,727 | 272,626 | 573,101 | ||||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | 485,305 | 1,185,812 | 674,930 | 510,881 | 1,223,848 | 732,327 | 491,520 | 1,264,397 | 750,589 | 513,807 | ||||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 481,431 | 886,343 | 295,503 | 590,840 | 957,751 | 332,877 | 624,874 | 980,980 | 334,689 | 646,291 | |||||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | 572,380 | 796,256 | 210,018 | 586,237 | 817,164 | 223,092 | 594,072 | 842,276 | 231,322 | 610,953 | ||||||||||||||||
32.01 | Property | Cape May Court House Storage | 362,649 | 494,141 | 121,679 | 372,462 | 504,236 | 128,438 | 375,798 | 517,299 | 131,258 | 386,041 | ||||||||||||||||||
32.02 | Property | North Cape May Storage | 209,731 | 302,115 | 88,339 | 213,776 | 312,927 | 94,654 | 218,274 | 324,977 | 100,064 | 224,912 | ||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 761,524 | 2,603,511 | 1,579,225 | 1,024,286 | 2,722,558 | 1,447,192 | 1,275,366 | 2,783,624 | 1,401,903 | 1,381,721 | |||||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | 796,988 | 970,041 | 209,549 | 760,492 | 983,061 | 188,025 | 795,036 | N/A | N/A | N/A | ||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | 483,213 | 761,117 | 262,746 | 498,371 | 818,280 | 294,532 | 523,748 | 822,911 | 294,361 | 528,550 | |||||||||||||||
36.01 | Property | Avondale Apartments | 349,958 | 567,571 | 202,614 | 364,957 | 600,320 | 221,810 | 378,510 | 605,278 | 214,189 | 391,089 | ||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | 133,255 | 193,546 | 60,132 | 133,414 | 217,960 | 72,722 | 145,238 | 217,633 | 80,172 | 137,461 | |||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | N/A | 880,159 | 258,926 | 621,233 | 868,532 | 252,233 | 616,300 | 864,189 | 261,984 | 602,205 | |||||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | 495,986 | 1,013,024 | 526,469 | 486,555 | 1,052,254 | 552,370 | 499,884 | 1,058,467 | 551,212 | 507,255 | ||||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | 379,800 | 379,800 | N/A | 379,800 | 379,800 | N/A | 379,800 | N/A | N/A | N/A | ||||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | 373,725 | 644,975 | 273,779 | 371,195 | 671,318 | 281,904 | 389,414 | N/A | N/A | N/A |
A-11 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | 2012 NOI ($) | 2013 EGI ($) | 2013 Expenses ($) | 2013 NOI ($) | 2014 EGI ($) | 2014 Expenses ($) | 2014 NOI ($) | Most Recent EGI (if past 2014) ($) | Most Recent Expenses (if past 2014) ($) | Most Recent NOI (if past 2014) ($) | |||||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | 371,977 | 716,838 | 255,357 | 461,481 | 856,608 | 258,875 | 597,733 | N/A | N/A | N/A | ||||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | 451,372 | 451,372 | N/A | 451,372 | 451,372 | N/A | 451,372 | N/A | N/A | N/A | ||||||||||||||||
42.01 | Property | Rite Aid - Manchester | 249,000 | 249,000 | N/A | 249,000 | 249,000 | N/A | 249,000 | N/A | N/A | N/A | ||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | 202,372 | 202,372 | N/A | 202,372 | 202,372 | N/A | 202,372 | N/A | N/A | N/A | ||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | N/A | 236,748 | 247,663 | (10,916) | 408,767 | 225,248 | 183,519 | 512,521 | 198,355 | 314,166 | |||||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | 366,818 | 795,060 | 435,282 | 359,778 | 808,807 | 454,281 | 354,526 | 813,637 | 463,842 | 349,795 | ||||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | 261,926 | 775,836 | 479,472 | 296,364 | 862,484 | 473,480 | 389,005 | 875,488 | 445,746 | 429,742 | ||||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 458,951 | 1,206,433 | 763,329 | 443,104 | 1,362,372 | 728,254 | 634,118 | 1,404,557 | 787,856 | 616,701 | |||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | 186,418 | 386,902 | 107,602 | 279,300 | 439,122 | 111,146 | 327,976 | 461,766 | 86,445 | 375,321 | |||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | 292,982 | 534,197 | 226,573 | 307,624 | 560,464 | 245,241 | 315,223 | 567,063 | 246,543 | 320,520 | ||||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 330,628 | 466,936 | 144,656 | 322,280 | 481,942 | 159,547 | 322,395 | 467,199 | 154,626 | 312,573 | |||||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | 236,402 | 373,550 | 112,344 | 261,206 | 399,318 | 123,588 | 275,730 | 406,485 | 123,179 | 283,306 |
A-12 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Most Recent NOI Date (if past 2014) | Most Recent # of months | Most Recent Description | Underwritten EGI ($) | Underwritten Expenses ($) | Underwritten Net Operating Income ($) | Debt Yield on Underwritten Net Operating Income (%) | Underwritten Replacement / FF&E Reserve ($) | Underwritten TI / LC ($) | Underwritten Net Cash Flow ($) | |||||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 2/28/2015 | 12 | Trailing 12 | 39,738,720 | 20,209,421 | 19,529,300 | 19.5% | 262,009 | 1,156,046 | 18,111,245 | ||||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | 1/31/2015 | Various | Various | 44,652,839 | 12,576,474 | 32,076,365 | 9.3% | 407,864 | 1,361,353 | 30,307,148 | |||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | 1/31/2015 | 12 | Trailing 12 | 14,683,901 | 4,083,127 | 10,600,774 | 111,948 | 382,322 | 10,106,504 | ||||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | 1/31/2015 | 12 | Trailing 12 | 6,162,374 | 1,870,943 | 4,291,431 | 67,466 | 165,082 | 4,058,884 | ||||||||||||||||||
2.03 | Property | 3101 Western Avenue | 1/31/2015 | 12 | Trailing 12 | 5,826,950 | 1,433,227 | 4,393,722 | 46,759 | 179,300 | 4,167,663 | |||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | 1/31/2015 | 12 | Trailing 12 | 5,586,331 | 1,531,758 | 4,054,573 | 56,540 | 207,115 | 3,790,919 | ||||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | 1/31/2015 | 12 | Trailing 12 | 5,320,897 | 1,635,565 | 3,685,333 | 47,462 | 174,152 | 3,463,718 | ||||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | 1/31/2015 | 12 | Trailing 12 | 3,071,393 | 831,397 | 2,239,996 | 31,069 | 111,657 | 2,097,270 | ||||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | 1/31/2015 | 12 | Trailing 12 | 1,787,392 | 503,308 | 1,284,083 | 21,146 | 53,364 | 1,209,573 | |||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | 1/31/2015 | 7 | Annualized | 1,354,243 | 428,391 | 925,852 | 16,618 | 56,295 | 852,940 | ||||||||||||||||||
2.09 | Property | 18 West Mercer Street | 1/31/2015 | 12 | Trailing 12 | 859,357 | 258,757 | 600,601 | 8,858 | 32,065 | 559,677 | |||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | N/A | N/A | Not Available | 66,737,601 | 32,904,905 | 33,832,696 | 13.1% | 764,053 | 1,153,463 | 31,915,179 | |||||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 3/31/2015 | 12 | Trailing 12 | 5,965,443 | 1,793,043 | 4,172,400 | 9.9% | 28,394 | 177,172 | 3,966,835 | |||||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | N/A | N/A | Not Available | 3,198,495 | 459,280 | 2,739,215 | 9.2% | 19,369 | 48,324 | 2,671,522 | |||||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | N/A | N/A | Not Available | 5,048,030 | 1,879,859 | 3,168,170 | 10.7% | 84,555 | 147,695 | 2,935,920 | |||||||||||||||
6.01 | Property | Highpointe Corporate Park | N/A | N/A | Not Available | 1,870,794 | 543,734 | 1,327,060 | 23,107 | 66,799 | 1,237,155 | |||||||||||||||||||
6.02 | Property | Rockside Business Pointe | N/A | N/A | Not Available | 1,280,491 | 494,405 | 786,085 | 25,502 | 43,794 | 716,789 | |||||||||||||||||||
6.03 | Property | 8 | Southport Center | N/A | N/A | Not Available | 1,267,490 | 647,712 | 619,778 | 17,859 | 16,479 | 585,440 | ||||||||||||||||||
6.04 | Property | MRN III | N/A | N/A | Not Available | 629,255 | 194,008 | 435,247 | 18,088 | 20,623 | 396,536 | |||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | 3/31/2015 | 12 | Trailing 12 | 4,632,476 | 2,229,683 | 2,402,793 | 8.7% | 144,232 | 0 | 2,258,561 | ||||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 3/31/2015 | 12 | Trailing 12 | 3,497,975 | 1,423,202 | 2,074,773 | 9.1% | 28,972 | 80,257 | 1,965,545 | |||||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 4/30/2015 | 12 | Trailing 12 | 3,074,556 | 809,582 | 2,264,974 | 10.0% | 21,038 | 101,755 | 2,142,180 | |||||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | N/A | N/A | Not Available | 3,458,093 | 865,068 | 2,593,025 | 11.7% | 39,951 | 100,241 | 2,452,832 | |||||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | 3/31/2015 | 12 | Trailing 12 | 2,718,303 | 923,023 | 1,795,280 | 8.7% | 35,260 | 0 | 1,760,020 | |||||||||||||||
11.01 | Property | Affordable Malta | 3/31/2015 | 12 | Trailing 12 | 903,155 | 274,122 | 629,033 | 11,681 | 0 | 617,352 | |||||||||||||||||||
11.02 | Property | A Space Place | 3/31/2015 | 12 | Trailing 12 | 599,126 | 195,810 | 403,315 | 4,985 | 0 | 398,331 | |||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | 3/31/2015 | 12 | Trailing 12 | 376,594 | 122,759 | 253,835 | 5,880 | 0 | 247,955 | |||||||||||||||||||
11.04 | Property | Snyders Best Rate | 3/31/2015 | 12 | Trailing 12 | 253,843 | 79,639 | 174,205 | 3,375 | 0 | 170,830 | |||||||||||||||||||
11.05 | Property | Affordable Wilton | 3/31/2015 | 12 | Trailing 12 | 252,560 | 73,181 | 179,378 | 4,365 | 0 | 175,013 | |||||||||||||||||||
11.06 | Property | Rotterdam Secured | 3/31/2015 | 12 | Trailing 12 | 191,016 | 109,141 | 81,875 | 3,010 | 0 | 78,865 | |||||||||||||||||||
11.07 | Property | Affordable Saratoga | 3/31/2015 | 12 | Trailing 12 | 142,010 | 68,371 | 73,639 | 1,965 | 0 | 71,674 | |||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | N/A | N/A | Not Available | 1,273,370 | 199,510 | 1,073,860 | 7.1% | 12,336 | 0 | 1,061,525 | ||||||||||||||||
12.01 | Property | Walmart - Lawton | N/A | N/A | Not Available | 642,650 | 92,417 | 550,233 | 6,168 | 0 | 544,065 | |||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | N/A | N/A | Not Available | 630,721 | 107,093 | 523,627 | 6,168 | 0 | 517,460 | |||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 2/28/2015 | 12 | Trailing 12 | 2,298,447 | 746,122 | 1,552,324 | 10.6% | 34,606 | 138,140 | 1,379,578 | |||||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 3/31/2015 | 12 | Trailing 12 | 1,681,405 | 448,867 | 1,232,538 | 8.7% | 11,262 | 13,696 | 1,207,580 | ||||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | 2/28/2015 | 12 | Trailing 12 | 2,090,476 | 721,229 | 1,369,247 | 11.0% | 30,487 | 0 | 1,338,760 | ||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | 2/28/2015 | 12 | Trailing 12 | 1,581,885 | 532,221 | 1,049,664 | 23,176 | 0 | 1,026,488 | |||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | 2/28/2015 | 12 | Trailing 12 | 508,591 | 189,008 | 319,583 | 7,311 | 0 | 312,272 | |||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | N/A | N/A | Not Available | 15,232,762 | 11,831,997 | 3,400,765 | 13.0% | 0 | 609,310 | 2,791,455 | |||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 3/31/2015 | 12 | Trailing 12 | 6,126,041 | 4,733,249 | 1,392,792 | 12.4% | 245,042 | 0 | 1,147,750 | |||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | 4/30/2015 | 12 | Trailing 12 | 1,538,190 | 653,425 | 884,765 | 8.3% | 34,250 | 0 | 850,515 | ||||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | N/A | N/A | Not Available | 1,245,738 | 324,405 | 921,332 | 9.1% | 5,627 | 39,665 | 876,040 | |||||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | 3/31/2015 | 12 | Trailing 12 | 1,703,266 | 578,477 | 1,124,788 | 12.5% | 7,597 | 0 | 1,117,191 | ||||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | N/A | N/A | Not Available | 1,384,418 | 638,003 | 746,416 | 8.3% | 18,711 | 0 | 727,705 | ||||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | N/A | N/A | Not Available | 3,551,902 | 1,980,638 | 1,571,264 | 17.5% | 45,174 | 195,168 | 1,330,922 | ||||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | 3/31/2015 | 12 | Trailing 12 | 1,432,973 | 738,826 | 694,147 | 8.8% | 44,500 | 0 | 649,647 | ||||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | 3/31/2015 | 12 | Trailing 12 | 944,639 | 237,269 | 707,369 | 9.8% | 19,772 | 65,906 | 621,691 | |||||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 2/28/2015 | 12 | Trailing 12 | 1,044,171 | 400,452 | 643,719 | 9.7% | 2,713 | 30,143 | 610,863 | ||||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | 4/30/2015 | 12 | Trailing 12 | 1,816,478 | 1,155,965 | 660,513 | 10.3% | 47,750 | 0 | 612,763 | ||||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | 3/31/2015 | 12 | Trailing 12 | 1,744,359 | 1,210,179 | 534,180 | 8.5% | 75,000 | 0 | 459,180 | |||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 2/28/2015 | 5 | Annualized | 1,565,916 | 811,303 | 754,613 | 12.3% | 24,252 | 139,894 | 590,467 | |||||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 2/28/2015 | 12 | Trailing 12 | 884,786 | 303,611 | 581,176 | 9.7% | 11,263 | 28,015 | 541,898 | ||||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | 4/30/2015 | 12 | Trailing 12 | 1,292,313 | 733,193 | 559,120 | 9.5% | 55,088 | 0 | 504,032 | ||||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 3/31/2015 | 12 | Trailing 12 | 981,246 | 332,005 | 649,241 | 11.1% | 9,157 | 55,656 | 584,428 | |||||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | 4/30/2015 | 12 | Trailing 12 | 842,632 | 271,512 | 571,120 | 10.3% | 10,845 | 0 | 560,275 | ||||||||||||||||
32.01 | Property | Cape May Court House Storage | 4/30/2015 | 12 | Trailing 12 | 523,299 | 157,960 | 365,339 | 6,146 | 0 | 359,193 | |||||||||||||||||||
32.02 | Property | North Cape May Storage | 4/30/2015 | 12 | Trailing 12 | 319,333 | 113,552 | 205,781 | 4,699 | 0 | 201,083 | |||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 3/31/2015 | 12 | Trailing 12 | 2,526,884 | 1,627,231 | 899,652 | 17.2% | 62,908 | 199,178 | 637,566 | |||||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | N/A | N/A | Not Available | 410,000 | 8,200 | 401,800 | 7.8% | 2,184 | 0 | 399,616 | ||||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | N/A | N/A | Not Available | 1,020,859 | 214,485 | 806,374 | 16.1% | 20,228 | 21,189 | 764,956 | ||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | N/A | N/A | Not Available | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | N/A | N/A | Not Available | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | N/A | N/A | Not Available | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | N/A | N/A | Not Available | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | N/A | N/A | Not Available | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | 4/30/2015 | 12 | Trailing 12 | 788,078 | 313,463 | 474,615 | 9.5% | 19,246 | 0 | 455,369 | |||||||||||||||
36.01 | Property | Avondale Apartments | 4/30/2015 | 12 | Trailing 12 | 580,287 | 240,931 | 339,356 | 14,382 | 0 | 324,974 | |||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | 4/30/2015 | 12 | Trailing 12 | 207,791 | 72,532 | 135,259 | 4,864 | 0 | 130,395 | ||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | 2/28/2015 | 12 | Trailing 12 | 850,965 | 301,099 | 549,866 | 11.2% | 15,386 | 52,369 | 482,111 | |||||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | 2/28/2015 | 12 | Trailing 12 | 1,042,001 | 577,112 | 464,889 | 9.9% | 30,000 | 0 | 434,889 | ||||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | N/A | N/A | Not Available | 372,204 | 7,444 | 364,760 | 8.1% | 1,365 | 0 | 363,395 | ||||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | N/A | N/A | Not Available | 687,903 | 306,424 | 381,480 | 8.9% | 0 | 0 | 381,480 |
A-13 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Most Recent NOI Date (if past 2014) | Most Recent # of months | Most Recent Description | Underwritten EGI ($) | Underwritten Expenses ($) | Underwritten Net Operating Income ($) | Debt Yield on Underwritten Net Operating Income (%) | Underwritten Replacement / FF&E Reserve ($) | Underwritten TI / LC ($) | Underwritten Net Cash Flow ($) | |||||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | N/A | N/A | Not Available | 854,202 | 336,663 | 517,539 | 13.3% | 18,098 | 46,264 | 453,177 | ||||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | N/A | N/A | Not Available | 425,401 | 18,762 | 406,639 | 10.7% | 4,971 | 17,012 | 384,657 | ||||||||||||||||
42.01 | Property | Rite Aid - Manchester | N/A | N/A | Not Available | 237,402 | 10,122 | 227,280 | 3,638 | 9,093 | 214,550 | |||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | N/A | N/A | Not Available | 187,999 | 8,640 | 179,359 | 1,333 | 7,919 | 170,107 | |||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | 3/31/2015 | 3 | Annualized | 654,420 | 241,367 | 413,053 | 11.2% | 3,979 | 44,514 | 364,560 | |||||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | 3/31/2015 | 12 | Trailing 12 | 813,637 | 463,650 | 349,987 | 9.7% | 27,280 | 0 | 322,707 | ||||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | 3/31/2015 | 12 | Trailing 12 | 896,694 | 512,088 | 384,606 | 11.3% | 41,100 | 0 | 343,506 | ||||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 2/28/2015 | 12 | Trailing 12 | 1,368,776 | 831,291 | 537,485 | 15.8% | 54,751 | 0 | 482,734 | |||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | 4/30/2015 | 12 | Trailing 12 | 452,360 | 146,787 | 305,573 | 9.5% | 8,775 | 2,450 | 294,348 | |||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | 2/28/2015 | 12 | Trailing 12 | 567,063 | 251,020 | 316,043 | 12.1% | 10,452 | 0 | 305,591 | ||||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 3/23/2015 | 12 | Trailing 12 | 459,600 | 155,941 | 303,658 | 12.3% | 13,443 | 15,606 | 274,610 | |||||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | 3/31/2015 | 12 | Trailing 12 | 418,485 | 154,314 | 264,171 | 11.2% | 8,396 | 0 | 255,775 |
A-14 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Underwritten NCF DSCR (x) (4) | Debt Yield on Underwritten Net Cash Flow (%) | Appraised Value ($) | Appraisal Date | As Stabilized Appraised Value ($) | As Stabilized Appraisal Date | Cut-off Date LTV Ratio (%) | LTV Ratio at Maturity / ARD (%) | Occupancy (%) (5) | Occupancy Date | |||||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 5.42 | 18.1% | 330,000,000 | 3/30/2015 | NAP | NAP | 30.3% | 30.3% | 95.7% | 3/31/2015 | ||||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | 2.22 | 8.8% | 544,500,000 | 3/2/2015 | 553,400,000 | Various | 63.4% | 62.3% | 92.4% | ||||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | 192,000,000 | 3/2/2015 | NAP | NAP | 97.8% | 2/23/2015 | |||||||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | 82,000,000 | 3/2/2015 | 84,000,000 | 3/1/2016 | 76.7% | 2/23/2015 | |||||||||||||||||||||
2.03 | Property | 3101 Western Avenue | 69,000,000 | 3/2/2015 | NAP | NAP | 96.1% | 2/23/2015 | ||||||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | 60,500,000 | 3/2/2015 | NAP | NAP | 99.7% | 2/23/2015 | |||||||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | 59,500,000 | 3/2/2015 | 63,500,000 | 3/1/2016 | 91.3% | 2/23/2015 | |||||||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | 35,800,000 | 3/2/2015 | 37,200,000 | 9/1/2015 | 89.4% | 2/23/2015 | |||||||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | 21,100,000 | 3/2/2015 | NAP | NAP | 98.1% | 2/23/2015 | ||||||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | 16,000,000 | 3/2/2015 | 17,500,000 | 6/1/2016 | 85.2% | 2/23/2015 | |||||||||||||||||||||
2.09 | Property | 18 West Mercer Street | 8,600,000 | 3/2/2015 | NAP | NAP | 94.6% | 2/23/2015 | ||||||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | 2.13 | 12.4% | 403,000,000 | 3/23/2015 | NAP | NAP | 64.1% | 51.2% | 88.3% | 4/22/2015 | |||||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 1.62 | 9.4% | 56,850,000 | 4/16/2015 | NAP | NAP | 73.9% | 68.6% | 93.3% | 5/21/2015 | |||||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | 1.64 | 8.9% | 43,000,000 | 3/10/2015 | 44,500,000 | 6/1/2015 | 69.6% | 55.1% | 84.8% | 3/27/2015 | |||||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | 1.67 | 10.0% | 42,472,500 | 3/18/2015 | 43,627,500 | Various | 69.5% | 59.0% | 83.0% | ||||||||||||||||
6.01 | Property | Highpointe Corporate Park | 15,100,000 | 3/18/2015 | NAP | NAP | 90.4% | 3/10/2015 | ||||||||||||||||||||||
6.02 | Property | Rockside Business Pointe | 10,250,000 | 3/18/2015 | NAP | NAP | 77.6% | 3/10/2015 | ||||||||||||||||||||||
6.03 | Property | 8 | Southport Center | 10,100,000 | 3/18/2015 | 11,200,000 | 3/18/2016 | 71.1% | 3/10/2015 | |||||||||||||||||||||
6.04 | Property | MRN III | 5,000,000 | 3/18/2015 | NAP | NAP | 100.0% | 3/10/2015 | ||||||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | 1.37 | 8.2% | 40,800,000 | 4/14/2015 | NAP | NAP | 67.4% | 61.6% | 99.0% | 3/23/2015 | ||||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 1.46 | 8.7% | 31,800,000 | 5/4/2015 | NAP | NAP | 71.4% | 65.1% | 93.5% | 5/13/2015 | |||||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 1.63 | 9.4% | 29,900,000 | 4/17/2015 | 30,300,000 | 10/17/2015 | 75.9% | 63.3% | 87.9% | 5/18/2015 | |||||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | 2.79 | 11.0% | 48,000,000 | 3/16/2015 | NAP | NAP | 46.3% | 46.3% | 90.9% | 3/19/2015 | |||||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | 1.42 | 8.6% | 30,500,000 | 3/9/2015 | NAP | NAP | 67.4% | 54.5% | 90.9% | ||||||||||||||||
11.01 | Property | Affordable Malta | 10,090,000 | 3/9/2015 | NAP | NAP | 75.3% | 3/26/2015 | ||||||||||||||||||||||
11.02 | Property | A Space Place | 6,000,000 | 3/19/2015 | NAP | NAP | 97.4% | 3/17/2015 | ||||||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | 3,750,000 | 3/9/2015 | NAP | NAP | 99.5% | 3/17/2015 | ||||||||||||||||||||||
11.04 | Property | Snyders Best Rate | 2,760,000 | 3/9/2015 | NAP | NAP | 98.2% | 3/17/2015 | ||||||||||||||||||||||
11.05 | Property | Affordable Wilton | 2,630,000 | 3/9/2015 | NAP | NAP | 100.0% | 3/17/2015 | ||||||||||||||||||||||
11.06 | Property | Rotterdam Secured | 1,700,000 | 3/9/2015 | NAP | NAP | 95.9% | 3/17/2015 | ||||||||||||||||||||||
11.07 | Property | Affordable Saratoga | 1,450,000 | 3/9/2015 | NAP | NAP | 100.0% | 3/17/2015 | ||||||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | 1.17 | 7.0% | 20,100,000 | 3/23/2015 | NAP | NAP | 75.1% | 64.0% | 100.0% | |||||||||||||||||
12.01 | Property | Walmart - Lawton | 10,300,000 | 3/23/2015 | NAP | NAP | 100.0% | 3/25/2015 | ||||||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | 9,800,000 | 3/23/2015 | NAP | NAP | 100.0% | 3/25/2015 | ||||||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 1.54 | 9.4% | 22,300,000 | 4/10/2015 | 23,000,000 | 4/1/2016 | 65.5% | 54.3% | 88.4% | 4/1/2015 | |||||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 1.48 | 8.5% | 19,700,000 | 2/12/2015 | NAP | NAP | 71.9% | 57.3% | 100.0% | 4/23/2015 | ||||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | 1.88 | 10.7% | 22,570,000 | 3/19/2015 | NAP | NAP | 55.2% | 43.9% | 92.3% | |||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | 17,800,000 | 3/19/2015 | NAP | NAP | 93.9% | 3/18/2015 | ||||||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | 4,770,000 | 3/19/2015 | NAP | NAP | 88.9% | 3/18/2015 | ||||||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | 1.72 | 10.7% | 31,900,000 | 12/1/2014 | 38,700,000 | 12/1/2017 | 73.3% | 55.1% | 79.1% | 10/31/2014 | |||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 1.70 | 10.2% | 16,600,000 | 4/1/2015 | 18,500,000 | 4/1/2017 | 67.5% | 50.2% | 69.8% | 3/31/2015 | |||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | 1.36 | 7.9% | 17,900,000 | 4/14/2015 | NAP | NAP | 59.8% | 54.4% | 95.2% | 5/14/2015 | ||||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | 1.37 | 8.7% | 14,500,000 | 4/1/2015 | NAP | NAP | 69.7% | 60.0% | 94.8% | 4/8/2015 | |||||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | 3.12 | 12.4% | 21,380,000 | 4/13/2015 | NAP | NAP | 42.1% | 42.1% | 95.4% | 3/26/2015 | ||||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | 1.38 | 8.1% | 12,400,000 | 4/2/2015 | NAP | NAP | 72.6% | 59.8% | 96.8% | 3/30/2015 | ||||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | 2.60 | 14.8% | 26,500,000 | 3/3/2015 | NAP | NAP | 33.9% | 26.9% | 91.3% | 1/31/2015 | ||||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | 1.38 | 8.2% | 10,500,000 | 4/6/2015 | NAP | NAP | 75.0% | 65.5% | 94.9% | 4/30/2015 | ||||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | 1.45 | 8.6% | 12,400,000 | 4/10/2015 | 13,600,000 | 5/1/2016 | 58.0% | 42.5% | 77.1% | 4/1/2015 | |||||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 1.56 | 9.2% | 10,650,000 | 3/28/2015 | NAP | NAP | 62.2% | 54.1% | 100.0% | 3/30/2015 | ||||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | 1.61 | 9.6% | 9,050,000 | 5/20/2015 | NAP | NAP | 70.7% | 61.6% | 96.9% | 4/24/2015 | ||||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | 1.23 | 7.3% | 9,600,000 | 3/17/2015 | NAP | NAP | 57.0% | 55.7% | 82.0% | 4/18/2015 | |||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 1.60 | 9.6% | 8,500,000 | 3/12/2015 | 10,500,000 | 3/1/2016 | 72.4% | 48.5% | 81.4% | 2/28/2015 | |||||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 1.52 | 9.0% | 9,400,000 | 3/13/2015 | NAP | NAP | 63.8% | 54.2% | 99.0% | 3/15/2015 | ||||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | 1.46 | 8.5% | 10,000,000 | 3/23/2015 | NAP | NAP | 59.0% | 53.7% | 94.9% | 4/13/2015 | ||||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 1.65 | 10.0% | 8,010,000 | 4/15/2015 | NAP | NAP | 72.8% | 62.2% | 88.5% | 3/25/2015 | |||||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | 1.63 | 10.1% | 8,670,000 | 3/26/2015 | NAP | NAP | 63.7% | 54.7% | 97.6% | |||||||||||||||||
32.01 | Property | Cape May Court House Storage | 5,620,000 | 3/26/2015 | NAP | NAP | 97.2% | 3/20/2015 | ||||||||||||||||||||||
32.02 | Property | North Cape May Storage | 3,050,000 | 3/26/2015 | NAP | NAP | 98.1% | 3/20/2015 | ||||||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 1.95 | 12.2% | 8,100,000 | 4/13/2015 | 10,860,000 | 4/13/2017 | 64.7% | 39.3% | 60.0% | 4/10/2015 | |||||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | 1.85 | 7.8% | 7,900,000 | 3/8/2015 | NAP | NAP | 65.3% | 65.3% | 100.0% | 4/1/2015 | ||||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | 2.68 | 15.3% | 10,510,000 | 4/22/2015 | NAP | NAP | 47.6% | 43.1% | 100.0% | |||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | 2,790,000 | 4/22/2015 | NAP | NAP | 100.0% | 4/9/2015 | ||||||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | 2,720,000 | 4/22/2015 | NAP | NAP | 100.0% | 4/9/2015 | |||||||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | 1,940,000 | 4/22/2015 | NAP | NAP | 100.0% | 4/9/2015 | ||||||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | 1,710,000 | 4/22/2015 | NAP | NAP | 100.0% | 4/9/2015 | ||||||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | 1,350,000 | 4/22/2015 | NAP | NAP | 100.0% | 4/9/2015 | ||||||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | 1.52 | 9.1% | 6,775,000 | 4/23/2015 | 7,175,000 | 6/1/2016 | 73.7% | 56.1% | 100.0% | ||||||||||||||||
36.01 | Property | Avondale Apartments | 4,775,000 | 4/23/2015 | NAP | NAP | 100.0% | 4/1/2015 | ||||||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | 2,000,000 | 4/23/2015 | 2,400,000 | 6/1/2016 | 100.0% | 4/1/2015 | |||||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | 1.60 | 9.9% | 8,800,000 | 4/10/2015 | 9,100,000 | 4/1/2016 | 55.6% | 43.7% | 84.7% | 4/1/2015 | |||||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | 1.56 | 9.3% | 6,500,000 | 3/10/2015 | NAP | NAP | 72.3% | 61.4% | 95.0% | 3/5/2015 | ||||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | 1.33 | 8.0% | 6,600,000 | 3/27/2015 | NAP | NAP | 68.5% | 55.3% | 100.0% | 5/31/2015 | ||||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | 1.18 | 8.9% | 5,900,000 | 2/7/2015 | NAP | NAP | 72.7% | 44.8% | 100.0% | 3/19/2015 |
A-15 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Underwritten NCF DSCR (x) (4) | Debt Yield on Underwritten Net Cash Flow (%) | Appraised Value ($) | Appraisal Date | As Stabilized Appraised Value ($) | As Stabilized Appraisal Date | Cut-off Date LTV Ratio (%) | LTV Ratio at Maturity / ARD (%) | Occupancy (%) (5) | Occupancy Date | |||||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | 1.88 | 11.6% | 6,550,000 | 4/9/2015 | NAP | NAP | 59.5% | 48.4% | 94.8% | 4/1/2015 | ||||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | 1.74 | 10.1% | 7,200,000 | Various | NAP | NAP | 52.6% | 42.2% | 100.0% | |||||||||||||||||
42.01 | Property | Rite Aid - Manchester | 3,700,000 | 3/15/2015 | NAP | NAP | 100.0% | 3/26/2015 | ||||||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | 3,500,000 | 3/12/2015 | NAP | NAP | 100.0% | 3/26/2015 | ||||||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | 1.64 | 9.9% | 4,900,000 | 4/7/2015 | 5,400,000 | 4/1/2016 | 75.0% | 59.5% | 89.2% | 5/1/2015 | |||||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | 1.49 | 9.0% | 5,200,000 | 4/8/2015 | NAP | NAP | 69.2% | 59.0% | 98.9% | 3/12/2015 | ||||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | 1.48 | 10.1% | 5,450,000 | 2/26/2015 | NAP | NAP | 62.3% | 46.2% | 93.4% | 4/24/2015 | ||||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 2.17 | 14.2% | 5,200,000 | 2/11/2015 | 5,600,000 | 3/1/2017 | 64.1% | 44.2% | 58.3% | 2/28/2015 | |||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | 1.52 | 9.2% | 4,700,000 | 4/7/2015 | NAP | NAP | 68.1% | 56.6% | 94.1% | 5/15/2015 | |||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | 1.88 | 11.7% | 4,440,000 | 3/24/2015 | NAP | NAP | 58.8% | 51.8% | 95.4% | 3/13/2015 | ||||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 1.78 | 11.1% | 3,825,000 | 4/1/2015 | NAP | NAP | 64.7% | 52.8% | 100.0% | 3/31/2015 | |||||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | 1.73 | 10.9% | 3,790,000 | 4/4/2015 | NAP | NAP | 62.0% | 53.3% | 83.0% | 4/13/2015 |
A-16 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | ADR ($) | RevPAR ($) | Largest Tenant | Largest Tenant Sq Ft | Largest Tenant Lease Expiration (6) | Second Largest Tenant | Second Largest Tenant Sq Ft | ||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | NAP | NAP | Bank of America | 826,962 | 7/31/2020 | O’Connell Tivin Miller Burns | 32,028 | |||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | NAP | NAP | |||||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | NAP | NAP | DDB Seattle | 54,369 | 3/31/2023 | Immigration and Customs Enforcement (ICE) | 51,235 | ||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | NAP | NAP | Washington State Ferries | 86,510 | 8/31/2020 | Cisco Systems | 66,363 | ||||||||||||||
2.03 | Property | 3101 Western Avenue | NAP | NAP | Cell Therapeutics | 66,045 | 4/30/2022 | Digital Fortress | 24,084 | |||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | NAP | NAP | Holland America | 179,042 | 12/31/2016 | Harris Group | 26,170 | ||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | NAP | NAP | Emeritus Corporation | 76,690 | 9/30/2025 | Alphagraphics | 23,175 | ||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | NAP | NAP | Oncothyreon, Inc. | 18,177 | 12/17/2018 | Graham Lundberg & Peschel | 18,177 | ||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | NAP | NAP | Seattle Housing Authority | 67,601 | 3/25/2023 | Washington Hardwoods | 4,408 | |||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | NAP | NAP | CKCA2 Inc. (Cosmo Kids) | 7,826 | 5/31/2025 | Koru Careers, Inc. | 6,816 | ||||||||||||||
2.09 | Property | 18 West Mercer Street | NAP | NAP | Comcast of Washington IV, Inc. | 17,822 | 1/31/2017 | Schwerin Campbell Barnard, LLP | 8,771 | |||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | NAP | NAP | The L.D. Kichler Company | 23,948 | 8/31/2016 | Generation Brands LLC dba Murray Feiss Imports and Monte Carlo Fans | 23,667 | ||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | NAP | NAP | City of Pasadena | 24,627 | 9/30/2016 | Iolo Technologies LLC | 15,821 | ||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | NAP | NAP | SSM Health Care of Oklahoma, Inc. | 67,717 | 2/22/2025 | OSOI | 8,723 | ||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | NAP | NAP | |||||||||||||||||
6.01 | Property | Highpointe Corporate Park | NAP | NAP | Harley Davidson Dealer Services, Inc. | 25,762 | 12/31/2019 | Ohio Center for Broadcasting | 15,240 | |||||||||||||||
6.02 | Property | Rockside Business Pointe | NAP | NAP | A-1 General Insurance Agency | 22,600 | 5/31/2017 | NAS Recruitment Communications | 14,178 | |||||||||||||||
6.03 | Property | 8 | Southport Center | NAP | NAP | ExactCare Pharmacy | 49,335 | 4/7/2021 | TRW | 17,487 | ||||||||||||||
6.04 | Property | MRN III | NAP | NAP | ExactCare Pharmacy | 26,977 | 7/31/2020 | Cleveland Baker’s Local Union | 17,120 | |||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | NAP | NAP | NAP | NAP | ||||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | NAP | NAP | Orinda Theatre | 14,290 | 11/30/2022 | Gillin, Jacobson, Ellis, Larsen & Lucy | 10,897 | ||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | NAP | NAP | Memorial Hermann | 40,283 | 8/31/2027 | Plaza Jewelers | 10,062 | ||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | NAP | NAP | Albertsons (Seafood City) | 32,745 | 11/30/2019 | Rite Aid | 21,440 | ||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | NAP | NAP | |||||||||||||||||
11.01 | Property | Affordable Malta | NAP | NAP | NAP | NAP | ||||||||||||||||||
11.02 | Property | A Space Place | NAP | NAP | NAP | NAP | ||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | NAP | NAP | NAP | NAP | ||||||||||||||||||
11.04 | Property | Snyders Best Rate | NAP | NAP | NAP | NAP | ||||||||||||||||||
11.05 | Property | Affordable Wilton | NAP | NAP | NAP | NAP | ||||||||||||||||||
11.06 | Property | Rotterdam Secured | NAP | NAP | NAP | NAP | ||||||||||||||||||
11.07 | Property | Affordable Saratoga | NAP | NAP | NAP | NAP | ||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | NAP | NAP | ||||||||||||||||||
12.01 | Property | Walmart - Lawton | NAP | NAP | Walmart | 41,117 | 1/13/2035 | NAP | ||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | NAP | NAP | Walmart | 41,117 | 1/27/2035 | NAP | ||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | NAP | NAP | Winn-Dixie | 55,107 | 12/31/2020 | Bealls Outlet | 41,290 | ||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | NAP | NAP | Martin’s Food Store (Ahold) | 65,455 | 5/31/2035 | V&M Wine & Spirits | 4,000 | |||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | NAP | NAP | ||||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | NAP | NAP | NAP | NAP | ||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | NAP | NAP | NAP | NAP | ||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | 93.22 | 73.75 | NAP | NAP | |||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 118.29 | 82.59 | NAP | NAP | |||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | NAP | NAP | NAP | NAP | ||||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | NAP | NAP | Big 5 Corp. | 10,000 | 1/31/2017 | O’Reilly’s Auto Parts | 6,000 | ||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | NAP | NAP | NAP | NAP | ||||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | NAP | NAP | NAP | NAP | ||||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | NAP | NAP | Appelrouth, Farah & Co., P.A. | 8,593 | 4/30/2018 | Turbana Corporation | 8,455 | |||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | NAP | NAP | NAP | NAP | ||||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | NAP | NAP | Tractor Supply Co | 23,316 | 3/31/2024 | Aldi | 21,378 | ||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | NAP | NAP | Sears | 5,000 | 4/30/2018 | Chase Bank | 4,422 | |||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | NAP | NAP | NAP | NAP | ||||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | NAP | NAP | NAP | NAP | |||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | NAP | NAP | Chart, Inc. | 32,782 | 12/31/2017 | Cleveland Urology Associates | 23,100 | ||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | NAP | NAP | Diamonette | 72,675 | 3/30/2030 | JIA Logistics, Inc. | 34,208 | |||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | NAP | NAP | NAP | NAP | ||||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | NAP | NAP | Par Exsalonce & Aveda Day Spa | 6,576 | 6/30/2020 | Yoga Center Of Kansas City | 3,638 | ||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | NAP | NAP | ||||||||||||||||||
32.01 | Property | Cape May Court House Storage | NAP | NAP | NAP | NAP | ||||||||||||||||||
32.02 | Property | North Cape May Storage | NAP | NAP | NAP | NAP | ||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | NAP | NAP | Fiserv Solutions, Inc. | 49,375 | 4/30/2023 | Talascend | 11,911 | ||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | NAP | NAP | Walgreens | 14,559 | 4/30/2090 | NAP | ||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | NAP | NAP | ||||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | NAP | NAP | Seed Dynamics | 12,140 | 4/1/2019 | Applied Industrial Technologies | 8,760 | |||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | NAP | NAP | Gianna’s | 13,000 | 9/30/2017 | Cardinale Moving & Shipping | 7,500 | ||||||||||||||
35.03 | Property | 11285 Commercial Parkway | NAP | NAP | MBARI | 15,200 | 9/30/2017 | Wiley | 6,400 | |||||||||||||||
35.04 | Property | 11085 Commercial Parkway | NAP | NAP | Bimbo Bakeries USA, Inc. | 9,060 | 8/31/2017 | JW Floor | 9,060 | |||||||||||||||
35.05 | Property | 11325 Commercial Parkway | �� | NAP | NAP | CableCom | 15,000 | 1/3/2017 | NAP | |||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | NAP | NAP | |||||||||||||||||
36.01 | Property | Avondale Apartments | NAP | NAP | NAP | NAP | ||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | NAP | NAP | NAP | NAP | |||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | NAP | NAP | Winn-Dixie Stores Leasing, LLC | 51,672 | 4/4/2022 | Central Florida Speech and Hearing Center, Inc. | 10,000 | ||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | NAP | NAP | NAP | NAP | ||||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | NAP | NAP | Walgreens | 13,650 | 8/31/2079 | NAP | ||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | NAP | NAP | Kohl’s | 100,000 | 3/15/2028 | NAP |
A-17 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | ADR ($) | RevPAR ($) | Largest Tenant | Largest Tenant Sq Ft | Largest Tenant Lease Expiration (6) | Second Largest Tenant | Second Largest Tenant Sq Ft | ||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | NAP | NAP | Bio-Medical App- Fresinius | 10,620 | 6/30/2020 | The Sherwin-Williams Company | 7,300 | |||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | NAP | NAP | ||||||||||||||||||
42.01 | Property | Rite Aid - Manchester | NAP | NAP | Rite Aid | 11,173 | 12/31/2025 | NAP | ||||||||||||||||
42.02 | Property | Rite Aid - Catskill | NAP | NAP | Rite Aid | 11,084 | 11/30/2025 | NAP | ||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | NAP | NAP | MLive | 12,407 | 5/31/2024 | Deepfield | 5,800 | ||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | NAP | NAP | NAP | NAP | ||||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | NAP | NAP | NAP | NAP | ||||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 121.92 | 71.07 | NAP | NAP | |||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | NAP | NAP | NAP | NAP | |||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | NAP | NAP | NAP | NAP | ||||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | NAP | NAP | Discount Drug Mart | 24,516 | 3/31/2018 | Grinders and Such | 4,000 | ||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | NAP | NAP | NAP | NAP |
A-18 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Second Largest Tenant Lease Expiration (6) | Third Largest Tenant | Third Largest Tenant Sq Ft | Third Largest Tenant Lease Expiration (6) | Fourth Largest Tenant | Fourth Largest Tenant Sq Ft | Fourth Largest Tenant Lease Expiration (6) | ||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 10/31/2024 | AmTrust North America | 26,849 | 11/30/2022 | FiServ Investment Solutions | 14,651 | 2/29/2020 | |||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | |||||||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | 3/31/2017 | CBP (Customs & Border Protection) | 48,220 | 3/31/2017 | WA State Housing Finance Commission | 26,440 | 6/30/2016 | ||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | 7/10/2019 | Ben Bridge | 41,686 | 8/23/2022 | Hearst Seattle Media | 6,085 | 2/28/2017 | ||||||||||||||
2.03 | Property | 3101 Western Avenue | 8/31/2022 | Riverstone Residential | 19,997 | 4/14/2023 | RLI Insurance | 14,799 | 4/15/2019 | |||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | 1/9/2019 | WA State Hospital Assoc | 20,311 | 11/14/2015 | Electric Lightwave | 56 | MTM | ||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | 7/24/2025 | TCS&Starquest Expeditions,Inc. | 20,286 | 12/15/2021 | Twisted Pair Solutions | 19,246 | 9/30/2017 | ||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | 11/21/2023 | Axio Research | 15,501 | 8/31/2017 | BN Builders | 14,813 | 6/30/2018 | ||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | 9/29/2016 | Julep, Inc | 4,152 | 3/31/2016 | College Spark | 3,373 | 12/6/2016 | |||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | 3/22/2020 | Lovsted Worthington | 5,412 | 1/25/2021 | Susan Hall Properties | 4,874 | 11/14/2019 | ||||||||||||||
2.09 | Property | 18 West Mercer Street | 8/31/2021 | Zymeworks Biopharmaceuticals | 3,539 | 1/25/2020 | National Cable Communications | 1,991 | 12/31/2017 | |||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | 8/31/2016 | Bill Luttrell, Inc. | 23,219 | 3/31/2019 | Ivystone Group, LLC | 22,759 | 4/30/2017 | ||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 12/31/2021 | Trend Micro Inc. | 8,044 | 10/31/2016 | California Department of Rehabilitation | 7,839 | 8/31/2017 | ||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | 3/31/2025 | Brent Scott | 3,042 | 3/15/2025 | Diana Hampton MD | 2,616 | 2/28/2025 | ||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | |||||||||||||||||||
6.01 | Property | Highpointe Corporate Park | 8/31/2020 | Crossroads Hospice | 14,810 | 3/31/2022 | Builders Exchange Inc. | 12,015 | 8/31/2016 | |||||||||||||||
6.02 | Property | Rockside Business Pointe | 5/7/2025 | Otis Elevator | 10,000 | 5/31/2018 | Triad Isotopes | 6,300 | 12/31/2017 | |||||||||||||||
6.03 | Property | 8 | Southport Center | 7/31/2020 | NAP | NAP | ||||||||||||||||||
6.04 | Property | MRN III | 5/31/2020 | NAP | NAP | |||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | NAP | NAP | ||||||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 6/30/2018 | Morgan Stanley | 8,902 | 12/31/2018 | Alain Pinel Realtors | 5,719 | 2/29/2020 | ||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 6/30/2030 | Majestic Kids (David G. Corbin) | 6,003 | 10/31/2020 | TX3rd Coast MMA (Marital Arts Gym) | 5,600 | 12/31/2016 | ||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | 5/31/2019 | Discount Tires | 6,585 | 12/31/2020 | JP Morgan Chase | 6,500 | 6/30/2019 | ||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | |||||||||||||||||||
11.01 | Property | Affordable Malta | NAP | NAP | ||||||||||||||||||||
11.02 | Property | A Space Place | NAP | NAP | ||||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | NAP | NAP | ||||||||||||||||||||
11.04 | Property | Snyders Best Rate | NAP | NAP | ||||||||||||||||||||
11.05 | Property | Affordable Wilton | NAP | NAP | ||||||||||||||||||||
11.06 | Property | Rotterdam Secured | NAP | NAP | ||||||||||||||||||||
11.07 | Property | Affordable Saratoga | NAP | NAP | ||||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | ||||||||||||||||||||
12.01 | Property | Walmart - Lawton | NAP | NAP | ||||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | NAP | NAP | ||||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 4/30/2018 | Fawcett Memorial Hospital | 31,905 | 12/31/2019 | Tuesday Morning | 18,000 | 7/31/2016 | ||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 2/28/2021 | Martin’s Fueling Station | 2,400 | 5/31/2035 | Classy Nails | 1,625 | 5/31/2018 | |||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | ||||||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | NAP | NAP | ||||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | NAP | NAP | ||||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | NAP | NAP | |||||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | NAP | NAP | |||||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | NAP | NAP | ||||||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | 1/31/2022 | Aztek Tacos | 3,123 | 4/30/2022 | Leslie’s Poolmart | 2,853 | 12/31/2017 | ||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | NAP | NAP | ||||||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | NAP | NAP | ||||||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | 5/31/2023 | Vizcaino Zomerfeld, LLP | 7,653 | 11/30/2017 | Eduardo R. Soto P.A. | 7,590 | 2/28/2022 | |||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | NAP | NAP | ||||||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | 12/31/2024 | Peebles | 15,200 | 1/31/2025 | Planet Fitness | 15,113 | 5/31/2021 | ||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 5/31/2028 | Osaka Steakhouse | 3,650 | 7/31/2019 | Mattress One | 2,700 | 5/31/2020 | |||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | NAP | NAP | ||||||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | NAP | NAP | |||||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 9/30/2027 | Sonobello | 7,720 | 12/31/2026 | New Horizons | 6,278 | 5/31/2016 | ||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 5/31/2018 | Leman USA, Inc. | 1,050 | 3/14/2018 | IJS Global, Inc. | 862 | 3/14/2017 | |||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | NAP | NAP | ||||||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 7/31/2018 | Tequila Harry’s | 3,447 | 6/30/2017 | College Optical Shop | 3,312 | 7/31/2020 | ||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | ||||||||||||||||||||
32.01 | Property | Cape May Court House Storage | NAP | NAP | ||||||||||||||||||||
32.02 | Property | North Cape May Storage | NAP | NAP | ||||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 12/31/2018 | GSA | 8,700 | 2/15/2026 | Loccino, Inc. | 8,000 | 02/31/2018 | ||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | NAP | NAP | ||||||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | ||||||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | 7/31/2018 | Kuida Ag | 8,760 | 9/30/2017 | NAP | |||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | 3/31/2018 | RMP | 7,500 | 3/31/2017 | NAP | ||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | MTM | NAP | NAP | |||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | 2/28/2018 | NAP | NAP | |||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | NAP | NAP | ||||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | |||||||||||||||||||
36.01 | Property | Avondale Apartments | NAP | NAP | ||||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | NAP | NAP | |||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | 3/31/2022 | Music Go Round | 5,225 | 4/30/2020 | Highlands MRI | 3,800 | 8/31/2016 | ||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | NAP | NAP | ||||||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | NAP | NAP | ||||||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | NAP | NAP |
A-19 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Second Largest Tenant Lease Expiration (6) | Third Largest Tenant | Third Largest Tenant Sq Ft | Third Largest Tenant Lease Expiration (6) | Fourth Largest Tenant | Fourth Largest Tenant Sq Ft | Fourth Largest Tenant Lease Expiration (6) | ||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | 1/31/2017 | Prime Time Soccer | 5,720 | 10/31/2016 | Greg Carter dba Auto Sport of Texas | 5,000 | 1/31/2016 | |||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | ||||||||||||||||||||
42.01 | Property | Rite Aid - Manchester | NAP | NAP | ||||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | NAP | NAP | ||||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | 4/30/2020 | Flagstar Bank | 5,447 | 4/30/2018 | NAP | ||||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | NAP | NAP | ||||||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | NAP | NAP | ||||||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | NAP | NAP | |||||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | NAP | NAP | |||||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | NAP | NAP | ||||||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 9/30/2016 | Dover-Philadelphia Federal | 3,173 | 9/30/2017 | Sunless Rayz Tanning | 2,000 | MTM | ||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | NAP | NAP |
A-20 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Fifth Largest Tenant | Fifth Largest Tenant Sq Ft | Fifth Largest Tenant Lease Expiration (6) | Environmental Phase I Report Date | Environmental Phase II | Environmental Phase II Report Date | Engineering Report Date | Seismic Report Date | PML or SEL (%) | ||||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | Frontenac Company, LLC | 13,419 | 4/30/2016 | 4/10/2015 | No | NAP | 4/20/2015 | NAP | NAP | |||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | |||||||||||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | Bader, Martin, Ross & Smith PS | 18,683 | 12/31/2020 | 3/4/2015 | No | NAP | 3/4/2015 | 3/4/2015 | 18% | ||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | MSRE | 5,900 | MTM | 3/4/2015 | No | NAP | 3/4/2015 | 3/4/2015 | 12% | ||||||||||||||||
2.03 | Property | 3101 Western Avenue | Merrick Hofstedt Lindsey | 13,968 | 2/28/2018 | 3/4/2015 | No | NAP | 3/4/2015 | 3/4/2015 | 17% | |||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | NAP | 3/4/2015 | No | NAP | 3/4/2015 | 3/4/2015 | 14% | ||||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | Softchoice Corporation | 16,623 | 8/14/2016 | 3/4/2015 | No | NAP | 3/4/2015 | 3/4/2015 | 17% | ||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | Municipal Research | 8,889 | 7/31/2019 | 3/4/2015 | No | NAP | 3/4/2015 | 3/4/2015 | 17% | ||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | Buddy TV | 3,348 | 9/30/2015 | 3/4/2015 | No | NAP | 3/4/2015 | 3/4/2015 | 18% | |||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | Pacific Crest Real Estate, LLC | 4,576 | 12/31/2019 | 3/6/2015 | No | NAP | 3/6/2015 | 3/6/2015 | 17% | ||||||||||||||||
2.09 | Property | 18 West Mercer Street | Sharon Sanborn | 930 | 5/31/2019 | 3/6/2015 | No | NAP | 3/6/2015 | 3/6/2015 | 12% | |||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | UMA Enterprises, Inc. | 22,647 | 12/31/2016 | 4/24/2015 | No | NAP | 4/3/2015 | NAP | NAP | ||||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | MetLife | 7,786 | 6/30/2017 | 4/14/2015 | No | NAP | 4/20/2015 | 4/20/2015 | 19% | ||||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | NAP | 2/24/2015 | No | NAP | 2/24/2015 | NAP | NAP | ||||||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | |||||||||||||||||||||||
6.01 | Property | Highpointe Corporate Park | YP Texas Yellow Pages | 11,012 | 8/30/2016 | 3/23/2015 | No | NAP | 3/23/2015 | NAP | NAP | |||||||||||||||||
6.02 | Property | Rockside Business Pointe | Carrier Corporation | 6,000 | 4/30/2018 | 3/23/2015 | No | NAP | 3/23/2015 | NAP | NAP | |||||||||||||||||
6.03 | Property | 8 | Southport Center | NAP | 3/23/2015 | No | NAP | 3/23/2015 | NAP | NAP | ||||||||||||||||||
6.04 | Property | MRN III | NAP | 3/23/2015 | No | NAP | 3/23/2015 | NAP | NAP | |||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | NAP | 4/16/2015 | No | NAP | 4/20/2015 | NAP | NAP | |||||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | Coldwell Banker Residential | 5,606 | 8/31/2020 | 4/1/2015 | No | NAP | 4/3/2015 | 4/6/2015 | 9% | ||||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | Bullpen Pizza Sports Bar | 4,104 | 10/31/2019 | 4/24/2015 | No | NAP | 4/23/2015 | NAP | NAP | ||||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | Community Dental | 5,373 | 1/31/2020 | 3/30/2015 | No | NAP | 4/1/2015 | 3/31/2015 | 13% | ||||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | |||||||||||||||||||||||
11.01 | Property | Affordable Malta | NAP | 4/2/2015 | No | NAP | 3/31/2015 | NAP | NAP | |||||||||||||||||||
11.02 | Property | A Space Place | NAP | 3/6/2015 | No | NAP | 3/26/2015 | NAP | NAP | |||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | NAP | 3/27/2015 | No | NAP | 3/28/2015 | NAP | NAP | |||||||||||||||||||
11.04 | Property | Snyders Best Rate | NAP | 4/2/2015 | No | NAP | 3/27/2015 | NAP | NAP | |||||||||||||||||||
11.05 | Property | Affordable Wilton | NAP | 4/3/2015 | No | NAP | 4/2/2015 | NAP | NAP | |||||||||||||||||||
11.06 | Property | Rotterdam Secured | NAP | 3/30/2015 | No | NAP | 3/30/2015 | NAP | NAP | |||||||||||||||||||
11.07 | Property | Affordable Saratoga | NAP | 4/2/2015 | No | NAP | 4/2/2015 | NAP | NAP | |||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | ||||||||||||||||||||||||
12.01 | Property | Walmart - Lawton | NAP | 3/24/2015 | No | NAP | 3/23/2015 | NAP | NAP | |||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | NAP | 3/23/2015 | No | NAP | 3/23/2015 | NAP | NAP | |||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | Charlotte County Sheriff’s Office | 15,000 | 4/30/2016 | 4/17/2015 | No | NAP | 4/17/2015 | NAP | NAP | ||||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | Holiday Hair | 1,600 | 5/30/2020 | 10/27/2014 | No | NAP | 2/6/2015 | NAP | NAP | |||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | ||||||||||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | NAP | 3/30/2015 | No | NAP | 3/30/2015 | 3/27/2015 | 12% | |||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | NAP | 3/30/2015 | No | NAP | 3/30/2015 | 3/27/2015 | 12% | |||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | NAP | 12/12/2014 | No | NAP | 12/12/2014 | NAP | NAP | ||||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | NAP | 4/6/2015 | No | NAP | 4/3/2015 | NAP | NAP | ||||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | NAP | 4/20/2015 | No | NAP | 4/20/2015 | 4/20/2015 | 3% | |||||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | Liquor Store | 2,610 | 8/31/2022 | 4/20/2015 | No | NAP | 4/20/2015 | 4/20/2015 | 10% | ||||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | NAP | 4/14/2015 | No | NAP | 4/14/2015 | NAP | NAP | |||||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | NAP | 4/6/2015 | No | NAP | 4/3/2015 | NAP | NAP | |||||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | O-I Latam Headquarters | 5,921 | 7/31/2022 | 3/17/2015 | No | NAP | 3/17/2015 | NAP | NAP | |||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | NAP | 4/15/2015 | No | NAP | 4/15/2015 | NAP | NAP | |||||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | Sleepy’s | 8,450 | 11/30/2020 | 4/21/2015 | No | NAP | 4/22/2015 | NAP | NAP | ||||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | Starbucks | 1,750 | 4/30/2018 | 3/30/2015 | No | NAP | 3/30/2015 | NAP | NAP | |||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | NAP | 5/27/2015 | No | NAP | 5/24/2015 | NAP | NAP | |||||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | NAP | 4/16/2015 | No | NAP | 4/20/2015 | NAP | NAP | ||||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | Center of Orthopedic Surgery | 4,706 | 7/31/2018 | 3/18/2015 | No | NAP | 3/18/2015 | NAP | NAP | ||||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | TBC Worldwide Corp. | 848 | 2/28/2016 | 3/23/2015 | No | NAP | 3/23/2015 | NAP | NAP | |||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | NAP | 4/3/2015 | No | NAP | 4/3/2015 | 4/16/2015 | 16% | |||||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | College Blvd Animal Hospital | 3,150 | 11/30/2019 | 4/28/2015 | No | NAP | 4/28/2015 | NAP | NAP | ||||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | ||||||||||||||||||||||||
32.01 | Property | Cape May Court House Storage | NAP | 4/2/2015 | No | NAP | 4/2/2015 | NAP | NAP | |||||||||||||||||||
32.02 | Property | North Cape May Storage | NAP | 4/2/2015 | No | NAP | 4/2/2015 | NAP | NAP | |||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | Eissmann Automotive NA, Inc. | 7,644 | 9/30/2020 | 4/16/2015 | No | NAP | 4/16/2015 | NAP | NAP | ||||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | NAP | 3/24/2015 | No | NAP | 3/24/2015 | NAP | NAP | |||||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | ||||||||||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | NAP | 5/27/2015 | No | NAP | 5/19/2015 | 5/19/2015 | 5% | |||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | NAP | 5/27/2015 | No | NAP | 5/19/2015 | 5/19/2015 | 21% | ||||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | NAP | 5/27/2015 | No | NAP | 5/19/2015 | 5/19/2015 | 14% | |||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | NAP | 5/27/2015 | No | NAP | 5/19/2015 | 5/19/2015 | 19% | |||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | NAP | 5/27/2015 | No | NAP | 5/19/2015 | 5/19/2015 | 19% | |||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | |||||||||||||||||||||||
36.01 | Property | Avondale Apartments | NAP | 4/30/2015 | No | NAP | 4/30/2015 | NAP | NAP | |||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | NAP | 5/1/2015 | No | NAP | 5/1/2015 | NAP | NAP | ||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | Liquor and Tobacco Outlet | 2,405 | 6/30/2015 | 4/14/2015 | No | NAP | 4/20/2015 | NAP | NAP | ||||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | NAP | 3/17/2015 | No | NAP | 3/18/2015 | NAP | NAP | |||||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | NAP | 3/30/2015 | No | NAP | 3/30/2015 | NAP | NAP | |||||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | NAP | 2/19/2015 | No | NAP | 2/19/2015 | NAP | NAP |
A-21 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Fifth Largest Tenant | Fifth Largest Tenant Sq Ft | Fifth Largest Tenant Lease Expiration (6) | Environmental Phase I Report Date | Environmental Phase II | Environmental Phase II Report Date | Engineering Report Date | Seismic Report Date | PML or SEL (%) | ||||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | Rosi’s Pupuseria | 4,000 | 2/28/2017 | 4/10/2015 | No | NAP | 4/13/2015 | NAP | NAP | |||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | ||||||||||||||||||||||||
42.01 | Property | Rite Aid - Manchester | NAP | 2/19/2015 | No | NAP | 2/17/2015 | NAP | NAP | |||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | NAP | 2/19/2015 | No | NAP | 2/16/2015 | NAP | NAP | |||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | NAP | 4/13/2015 | No | NAP | 4/14/2015 | NAP | NAP | ||||||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | NAP | 4/15/2015 | No | NAP | 4/14/2015 | NAP | NAP | |||||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | NAP | 3/11/2015 | No | NAP | 3/12/2015 | NAP | NAP | |||||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | NAP | 3/9/2015 | No | NAP | 3/9/2015 | NAP | NAP | ||||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | NAP | 4/16/2015 | No | NAP | 4/16/2015 | NAP | NAP | ||||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | NAP | 3/30/2015 | No | NAP | 3/27/2015 | NAP | NAP | |||||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | Cellular Central, Inc. | 2,000 | 6/30/2016 | 4/3/2015 | No | NAP | 4/3/2015 | NAP | NAP | ||||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | NAP | 4/13/2015 | No | NAP | 4/13/2015 | NAP | NAP |
A-22 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Earthquake Insurance Required | Upfront RE Tax Reserve ($) | Ongoing RE Tax Reserve ($) | Upfront Insurance Reserve ($) | Ongoing Insurance Reserve ($) | Upfront Replacement Reserve ($) | Ongoing Replacement Reserve ($) | Replacement Reserve Caps ($) | |||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | No | 2,686,535 | 671,634 | 0 | 0 | 0 | 20,970 | 0 | ||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | No | 255,019 | 255,019 | 0 | 0 | 0 | 33,989 | 0 | |||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | No | ||||||||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | No | ||||||||||||||||||||||
2.03 | Property | 3101 Western Avenue | No | |||||||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | No | ||||||||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | No | ||||||||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | No | ||||||||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | No | |||||||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | No | ||||||||||||||||||||||
2.09 | Property | 18 West Mercer Street | No | |||||||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | No | 439,167 | 87,833 | 47,500 | 0 | 910,580 | 0 | 910,580 | |||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | No | 134,853 | 26,971 | 28,498 | 3,562 | 0 | 2,366 | 0 | |||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | No | 17,998 | 5,999 | 16,009 | 4,002 | 0 | 1,614 | 58,108 | |||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | No | 0 | 50,076 | 0 | 5,166 | 0 | 7,046 | 0 | |||||||||||||
6.01 | Property | Highpointe Corporate Park | No | |||||||||||||||||||||||
6.02 | Property | Rockside Business Pointe | No | |||||||||||||||||||||||
6.03 | Property | 8 | Southport Center | No | ||||||||||||||||||||||
6.04 | Property | MRN III | No | |||||||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | No | 100,065 | 47,650 | 29,312 | 13,958 | 0 | 12,019 | 0 | ||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | No | 87,168 | 29,056 | 0 | 0 | 0 | 2,414 | 90,000 | |||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | No | 129,591 | 21,599 | 62,615 | 11,195 | 0 | 1,750 | 0 | |||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | No | 114,021 | 28,505 | 0 | 0 | 0 | 3,400 | 0 | |||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | No | 118,021 | 28,100 | 43,186 | 5,141 | 0 | 2,938 | 0 | |||||||||||||
11.01 | Property | Affordable Malta | No | |||||||||||||||||||||||
11.02 | Property | A Space Place | No | |||||||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | No | |||||||||||||||||||||||
11.04 | Property | Snyders Best Rate | No | |||||||||||||||||||||||
11.05 | Property | Affordable Wilton | No | |||||||||||||||||||||||
11.06 | Property | Rotterdam Secured | No | |||||||||||||||||||||||
11.07 | Property | Affordable Saratoga | No | |||||||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | No | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
12.01 | Property | Walmart - Lawton | No | |||||||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | No | |||||||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | No | 94,912 | 22,598 | 136,838 | 11,847 | 0 | 2,884 | 0 | |||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | No | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | No | 125,743 | 12,574 | 18,630 | 2,329 | 0 | 2,541 | 0 | ||||||||||||||
15.01 | Property | Best Storage-Tudor Road | No | |||||||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | No | |||||||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | No | 355,285 | 71,057 | 0 | 14,260 | 0 | 0 | 0 | |||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | No | 0 | 14,549 | 59,882 | 4,990 | 0 | 20,420 | 0 | |||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | No | 70,121 | 8,765 | 0 | 0 | 0 | 2,854 | 0 | ||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | No | 8,723 | 8,723 | 6,030 | 861 | 0 | 469 | 30,000 | |||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | No | 40,929 | 8,186 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | No | 38,664 | 6,444 | 23,319 | 3,886 | 0 | 1,554 | 0 | ||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | No | 268,764 | 38,395 | 37,188 | 18,594 | 0 | 3,670 | 900,000 | ||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | No | 54,564 | 7,795 | 20,993 | 3,499 | 0 | 3,708 | 133,500 | ||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | No | 42,345 | 5,293 | 7,799 | 600 | 375,000 | 1,648 | 59,315 | |||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | No | 170,128 | 21,266 | 3,120 | 1,560 | 0 | 226 | 0 | ||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | No | 67,476 | 10,711 | 28,444 | 9,030 | 0 | 3,979 | 0 | ||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | No | 24,326 | 8,109 | 93,330 | 8,485 | 100,000 | 6,250 | 200,000 | |||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | No | 0 | 26,333 | 10,071 | 1,259 | 0 | 2,021 | 0 | |||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | No | 86,417 | 10,802 | 52,163 | 6,520 | 190,000 | 0 | 50,000 | ||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | No | 25,191 | 6,298 | 0 | 0 | 0 | 4,591 | 0 | ||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | No | 29,973 | 14,273 | 5,884 | 1,121 | 0 | 763 | 0 | |||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | No | 16,865 | 5,354 | 2,136 | 1,017 | 0 | 904 | 0 | ||||||||||||||
32.01 | Property | Cape May Court House Storage | No | |||||||||||||||||||||||
32.02 | Property | North Cape May Storage | No | |||||||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | No | 128,057 | 14,229 | 5,322 | 5,322 | 0 | 5,242 | 314,540 | |||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | No | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | No | 16,952 | 5,651 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | No | |||||||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | No | ||||||||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | No | |||||||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | No | |||||||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | No | |||||||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | No | 42,070 | 5,259 | 31,246 | 4,464 | 412,050 | 1,603 | 0 | |||||||||||||
36.01 | Property | Avondale Apartments | No | |||||||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | No | ||||||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | No | 29,669 | 7,064 | 48,649 | 4,212 | 0 | 1,282 | 0 | |||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | No | 54,515 | 9,086 | 27,052 | 6,763 | 175,000 | 0 | 175,000 | ||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | No | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | No | 0 | 0 | 342 | 0 | 0 | 0 | 0 |
A-23 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Earthquake Insurance Required | Upfront RE Tax Reserve ($) | Ongoing RE Tax Reserve ($) | Upfront Insurance Reserve ($) | Ongoing Insurance Reserve ($) | Upfront Replacement Reserve ($) | Ongoing Replacement Reserve ($) | Replacement Reserve Caps ($) | |||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | No | 56,149 | 9,358 | 27,871 | 2,534 | 0 | 1,508 | 0 | ||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | No | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
42.01 | Property | Rite Aid - Manchester | No | |||||||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | No | |||||||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | No | 137,757 | 12,523 | 2,967 | 495 | 0 | 332 | 11,937 | |||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | No | 47,415 | 9,483 | 12,821 | 1,425 | 0 | 2,273 | 0 | ||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | No | 47,352 | 6,765 | 24,935 | 6,234 | 179,196 | 3,425 | 0 | ||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | No | 3,774 | 3,774 | 5,597 | 1,119 | 0 | 4,888 | 0 | |||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | No | 19,268 | 2,622 | 5,550 | 2,643 | 0 | 731 | 0 | |||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | No | 50,160 | 5,573 | 638 | 319 | 0 | 871 | 31,356 | ||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | No | 6,098 | 6,098 | 4,744 | 678 | 0 | 1,120 | 0 | |||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | No | 9,479 | 4,514 | 1,717 | 818 | 0 | 700 | 0 |
A-24 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Upfront TI/LC Reserve ($) | Ongoing TI/LC Reserve ($) | TI/LC Caps ($) | Upfront Debt Service Reserve ($) | Ongoing Debt Service Reserve ($) | Upfront Deferred Maintenance Reserve ($) | Ongoing Deferred Maintenance Reserve ($) | Upfront Environmental Reserve ($) | |||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 0 | 52,425 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | 0 | 203,932 | 0 | 0 | 0 | 337,524 | 0 | 0 | |||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | |||||||||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | |||||||||||||||||||||||
2.03 | Property | 3101 Western Avenue | ||||||||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | |||||||||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | |||||||||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | |||||||||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | ||||||||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | |||||||||||||||||||||||
2.09 | Property | 18 West Mercer Street | ||||||||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | 1,500,000 | 0 | 1,500,000 | 0 | 0 | 0 | 0 | 0 | |||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 550,000 | 0 | 450,000 | 0 | 0 | 32,500 | 0 | 0 | |||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | 0 | 4,027 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | 371,000 | 19,459 | 701,908 | 0 | 0 | 9,375 | 0 | 0 | |||||||||||||
6.01 | Property | Highpointe Corporate Park | ||||||||||||||||||||||||
6.02 | Property | Rockside Business Pointe | ||||||||||||||||||||||||
6.03 | Property | 8 | Southport Center | |||||||||||||||||||||||
6.04 | Property | MRN III | ||||||||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | 0 | 0 | 0 | 0 | 0 | 748,326 | 0 | 25,000 | ||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 0 | 10,417 | 350,000 | 0 | 0 | 918,205 | 0 | 0 | |||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 0 | 10,000 | 300,000 | 0 | 0 | 120,654 | 0 | 19,473 | |||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | 0 | 0 | 0 | 0 | 0 | 41,195 | 0 | 990 | |||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | 0 | 0 | 0 | 0 | 0 | 10,250 | 0 | 0 | |||||||||||||
11.01 | Property | Affordable Malta | ||||||||||||||||||||||||
11.02 | Property | A Space Place | ||||||||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | ||||||||||||||||||||||||
11.04 | Property | Snyders Best Rate | ||||||||||||||||||||||||
11.05 | Property | Affordable Wilton | ||||||||||||||||||||||||
11.06 | Property | Rotterdam Secured | ||||||||||||||||||||||||
11.07 | Property | Affordable Saratoga | ||||||||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
12.01 | Property | Walmart - Lawton | ||||||||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | ||||||||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 250,000 | 10,574 | 380,662 | 0 | 0 | 6,750 | 0 | 0 | |||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | 0 | 0 | 0 | 0 | 0 | 65,088 | 0 | 0 | ||||||||||||||
15.01 | Property | Best Storage-Tudor Road | ||||||||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | ||||||||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | 0 | 0 | 0 | 0 | 0 | 23,750 | 0 | 0 | |||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 0 | 0 | 0 | 0 | 0 | 10,350 | 0 | 0 | |||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | 0 | 2,500 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | 0 | 0 | 0 | 0 | 0 | 17,215 | 0 | 0 | ||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | 0 | 0 | 0 | 0 | 0 | 6,875 | 0 | 0 | ||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | 30,000 | 5,492 | 197,718 | 0 | 0 | 224,207 | 0 | 0 | |||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 0 | 2,487 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | 0 | 0 | 0 | 0 | 0 | 253,125 | 0 | 0 | |||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 1,325,356 | 10,260 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 30,000 | 2,335 | 125,000 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | 0 | 0 | 0 | 0 | 0 | 51,783 | 0 | 0 | ||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 85,000 | 1,908 | 100,000 | 0 | 0 | 90,625 | 0 | 0 | |||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | 0 | 0 | 0 | 0 | 0 | 12,450 | 0 | 0 | ||||||||||||||
32.01 | Property | Cape May Court House Storage | ||||||||||||||||||||||||
32.02 | Property | North Cape May Storage | ||||||||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 375,000 | 19,416 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | ||||||||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | |||||||||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | ||||||||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | ||||||||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | ||||||||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | 0 | 0 | 0 | 0 | 0 | 47,950 | 0 | 0 | |||||||||||||
36.01 | Property | Avondale Apartments | ||||||||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | |||||||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | 0 | 5,556 | 0 | 0 | 0 | 323,125 | 0 | 0 | |||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | 0 | 0 | 0 | 0 | 0 | 300,404 | 0 | 0 | ||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
A-25 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Upfront TI/LC Reserve ($) | Ongoing TI/LC Reserve ($) | TI/LC Caps ($) | Upfront Debt Service Reserve ($) | Ongoing Debt Service Reserve ($) | Upfront Deferred Maintenance Reserve ($) | Ongoing Deferred Maintenance Reserve ($) | Upfront Environmental Reserve ($) | |||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | 200,000 | 0 | 200,000 | 0 | 0 | 25,463 | 0 | 0 | ||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||
42.01 | Property | Rite Aid - Manchester | ||||||||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | ||||||||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | 50,000 | 2,211 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | 0 | 0 | 0 | 0 | 0 | 52,150 | 0 | 0 | ||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | 0 | 0 | 0 | 0 | 0 | 69,569 | 0 | 0 | ||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 0 | 0 | 0 | 0 | 0 | 2,500 | 0 | 0 | |||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | 0 | 204 | 0 | 0 | 0 | 4,625 | 0 | 0 | |||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | 0 | 0 | 0 | 0 | 0 | 8,750 | 0 | 0 | ||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 150,000 | 1,921 | 115,230 | 0 | 0 | 39,063 | 0 | 0 | |||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
A-26 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Ongoing Environmental Reserve ($) | Upfront Other Reserve ($) | Ongoing Other Reserve ($) | Other Reserve Description | |||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 0 | 0 | 0 | |||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | 0 | 7,278,662 | 0 | Unexecuted Lease Holdback ($3,900,807); Unfunded Obligations ($3,377,855) | |||||||||
2.01 | Property | 11 | 1000 Second Avenue | |||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | |||||||||||||||
2.03 | Property | 3101 Western Avenue | ||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | |||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | |||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | |||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | ||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | |||||||||||||||
2.09 | Property | 18 West Mercer Street | ||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | 0 | 0 | 0 | ||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 0 | 569,439 | 0 | Free Rent Reserve ($411,490); Unfunded Obligations Reserve ($157,949) | |||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | 0 | 205,617 | 0 | Construction Reserve (162,604.95); Mezzanine Interest Reserve (43,012.50) | |||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | 0 | 346,906 | 0 | Free Rent Reserve | |||||||||
6.01 | Property | Highpointe Corporate Park | ||||||||||||||||
6.02 | Property | Rockside Business Pointe | ||||||||||||||||
6.03 | Property | 8 | Southport Center | |||||||||||||||
6.04 | Property | MRN III | ||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | 0 | 0 | 0 | |||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 0 | 519,061 | 0 | Unfunded Obligations Reserve | |||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 0 | 586,075 | 0 | Unfunded Obligations Reserve | |||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | 0 | 0 | 0 | ||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | 0 | 0 | 0 | ||||||||||
11.01 | Property | Affordable Malta | ||||||||||||||||
11.02 | Property | A Space Place | ||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | ||||||||||||||||
11.04 | Property | Snyders Best Rate | ||||||||||||||||
11.05 | Property | Affordable Wilton | ||||||||||||||||
11.06 | Property | Rotterdam Secured | ||||||||||||||||
11.07 | Property | Affordable Saratoga | ||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | 0 | 40,600 | 0 | Punchlist Reserve | ||||||||||
12.01 | Property | Walmart - Lawton | ||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | ||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 0 | 0 | 0 | ||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 0 | 0 | 0 | |||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | 0 | 0 | 0 | |||||||||||
15.01 | Property | Best Storage-Tudor Road | ||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | ||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | 0 | 4,654,443 | 0 | PIP Reserve ($4,612,308); Parking Rent Reserve ($42,135) | |||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 0 | 0 | 0 | ||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | 0 | 0 | 0 | |||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | 0 | 66,623 | 0 | Unfunded Obligations Reserve ($43,750); Big 5 Cam Holdback ($22,872.80) | |||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | 0 | 0 | 0 | |||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | 0 | 0 | 0 | |||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | 0 | 0 | 0 | |||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | 0 | 0 | 0 | |||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | 0 | 4,673 | 0 | Sprint Free Rent Reserve | |||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 0 | 3,500 | 583 | Ground Lease Reserve | ||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | 0 | 0 | 0 | |||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | 0 | 825,000 | 0 | Economic Holdback | |||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 0 | 0 | 0 | ||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 0 | 0 | 0 | |||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | 0 | 0 | 0 | |||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 0 | 0 | 0 | ||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | 0 | 0 | 0 | |||||||||||
32.01 | Property | Cape May Court House Storage | ||||||||||||||||
32.02 | Property | North Cape May Storage | ||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 0 | 0 | 0 | ||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | 0 | 0 | 0 | |||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | 0 | 37,500 | 0 | Earthquake Retrofit Reserve | ||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | ||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | |||||||||||||||
35.03 | Property | 11285 Commercial Parkway | ||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | ||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | ||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | 0 | 340,000 | 0 | ACC Holdback | |||||||||
36.01 | Property | Avondale Apartments | ||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | |||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | 0 | 78,750 | 0 | SSDS O&M Remediation Funds | |||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | 0 | 75,000 | 0 | Roof Repairs Reserve | ||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | 0 | 0 | 0 | |||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | 0 | 0 | 0 |
A-27 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Ongoing Environmental Reserve ($) | Upfront Other Reserve ($) | Ongoing Other Reserve ($) | Other Reserve Description | |||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | 0 | 0 | 0 | |||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | 0 | 0 | 0 | |||||||||||
42.01 | Property | Rite Aid - Manchester | ||||||||||||||||
42.02 | Property | Rite Aid - Catskill | ||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | 0 | 236,954 | 0 | Deepfield Lease Reserve ($130,500); Deepfield Finance Reserve ($66,700); Deepfield GAP Rent Reserve ($39,754) | |||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | 0 | 0 | 0 | |||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | 0 | 0 | 0 | |||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 0 | 123,023 | 0 | PIP Reserve | |||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | 0 | 0 | 0 | ||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | 0 | 25,000 | 0 | Leasing Office Construction Reserve | ||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 0 | 0 | 0 | ||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | 0 | 0 | 0 |
A-28 |
CGCMT 2015-GC31 Annex A | ||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Borrower Name | ||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 135 S LaSalle Property, LLC | |||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | Selig Holdings Company L.L.C. | ||||||
2.01 | Property | 11 | 1000 Second Avenue | |||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | |||||||||
2.03 | Property | 3101 Western Avenue | ||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | |||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | |||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | |||||||||
2.07 | Property | 190 Queen Anne Avenue North | ||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | |||||||||
2.09 | Property | 18 West Mercer Street | ||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | WTC-Trade Mart 2015, L.P. | ||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | Sherman Oaks Capital Associates, LP and Pasadena Holdings, LLC | ||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | WHP Senior, LLC | ||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | MRN Cleaveland I, LLC, MRN Cleaveland II, LLC, MRN Cleaveland III, LLC and Southport Center, LLC | ||||||
6.01 | Property | Highpointe Corporate Park | ||||||||||
6.02 | Property | Rockside Business Pointe | ||||||||||
6.03 | Property | 8 | Southport Center | |||||||||
6.04 | Property | MRN III | ||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | Chalet Apartments 5774 LLC | |||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | Orinda Dunhill LLC and DE Orinda Borrower LLC | ||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | KFLP Partnership, LTD. and JDLP, LTD. | ||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | Mesa Town Center, LLC | ||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | Prime Malta LLC, Prime Saratoga LLC, Prime Wilton LLC, Prime Self Storage of Long Island LLC, Prime Dix Ave LLC, Prime Rotterdam LLC and Prime Latham LLC | ||||||
11.01 | Property | Affordable Malta | ||||||||||
11.02 | Property | A Space Place | ||||||||||
11.03 | Property | Dix Ave Mini Storage | ||||||||||
11.04 | Property | Snyders Best Rate | ||||||||||
11.05 | Property | Affordable Wilton | ||||||||||
11.06 | Property | Rotterdam Secured | ||||||||||
11.07 | Property | Affordable Saratoga | ||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | Hollywood WNM Lawton, LLC and Hollywood WNM Sooner, LLC | |||||||
12.01 | Property | Walmart - Lawton | ||||||||||
12.02 | Property | Walmart - Oklahoma City | ||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | JLJI PC, LLC | ||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | Hagerstown Plaza, LLC | |||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | Tudor Storage, LLC and Storage West SPE, LLC | |||||||
15.01 | Property | Best Storage-Tudor Road | ||||||||||
15.02 | Property | Best Storage-Woodland Drive | ||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | Bloomington Hotel Ventures L.L.C. | ||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | Magnolia Omaha, LP | ||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | Oakmont Apartment Investors, LLC | |||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | BRSC 3-6, LLC | ||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | CSS OAHU II | |||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | Cottage Landing Properties, LLC | |||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | 999 Ponce, LLC | |||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | Country Meadows DeWitt, LLC | |||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | WRD Shippensburg LP | ||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | Local Blackrock LLC | |||||||
26 | Loan | RMF | RMF | Deer Park Gardens | Mansion Partners, Ltd. | |||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | FN Capital, LLC | ||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 10500 Antenucci Holdings LLC | ||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | Camel, LLC | |||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | Ralston West | |||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | CVA, LLC | ||||||
32 | Loan | RMF | RMF | Cape May Portfolio | Curcio NJ, North Cape May, LLC and Curcio NJ, Cape May Courthouse, LLC | |||||||
32.01 | Property | Cape May Court House Storage | ||||||||||
32.02 | Property | North Cape May Storage | ||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | Northfield Plaza Associates, L.L.C. | ||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | N Smithfield LLC | |||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | A/J Properties 1977 LLC, A/J Properties CIP 1 LLC, A/J Properties CIP 3 LLC, A/J Properties CIP 4 LLC and A/J Properties CIP 36 LLC | |||||||
35.01 | Property | 1081 and 1083 Harkins Road | ||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | |||||||||
35.03 | Property | 11285 Commercial Parkway | ||||||||||
35.04 | Property | 11085 Commercial Parkway | ||||||||||
35.05 | Property | 11325 Commercial Parkway | ||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | Granite Court Apartments, Inc. and Avondale Rentals, Inc. | ||||||
36.01 | Property | Avondale Apartments | ||||||||||
36.02 | Property | 8, 37 | Granite Court | |||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | JLJI LL, LLC | ||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | Jester Trails Apartments, LTD., Applecreek Lonestar, LLC and Las Palmas Group TX LLC | |||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | Tenney’s Winston-Salem, LLC | |||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | Continental 182 Fund LLC |
A-29 |
CGCMT 2015-GC31 Annex A | ||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Borrower Name | ||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | Rana Enterprise Holdings, LLC | |||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | 226 West Bridge Developers Corp. and 335 Center Street Developers Corp. | |||||||
42.01 | Property | Rite Aid - Manchester | ||||||||||
42.02 | Property | Rite Aid - Catskill | ||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | WIC 111North LLC | ||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | MIMG XXII Eagle’s Pointe, LLC | |||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | Larkin DV Holdings, LLC | |||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | Eagle-Vail Partners, LLC | ||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | Golden Triangle Storage, Inc. | ||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | Metro Storage II, L.L.C. | |||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | DNZ-Dover, LLC | ||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | Curcio NJ, Hammonton, LLC |
A-30 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Delaware Statutory Trust? | Carve-out Guarantor | Loan Purpose | Loan Amount (sources) | |||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | No | Michael Karfunkel 2005 GRAT and George Karfunkel | Refinance | 100,000,000 | ||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | No | Selig Family Holdings, LLC and Martin Selig | Refinance | 345,000,000 | |||||||||
2.01 | Property | 11 | 1000 Second Avenue | |||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | |||||||||||||||
2.03 | Property | 3101 Western Avenue | ||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | |||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | |||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | |||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | ||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | |||||||||||||||
2.09 | Property | 18 West Mercer Street | ||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | No | Dallas Market Center Financial, L.L.C. | Refinance | 259,000,000 | |||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | No | Albert Taban and Michael Pashaie | Refinance | 42,000,000 | |||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | No | G. David Neff, Jr., Dwight Darin Miller, the G. David Neff Jr. Living Trust and the Dwight Darin Miller Living Trust | Refinance | 30,000,000 | |||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | No | Richard V. Nosan | Refinance | 29,500,000 | |||||||||
6.01 | Property | Highpointe Corporate Park | ||||||||||||||||
6.02 | Property | Rockside Business Pointe | ||||||||||||||||
6.03 | Property | 8 | Southport Center | |||||||||||||||
6.04 | Property | MRN III | ||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | No | Pinchos Shemano | Refinance | 27,500,000 | ||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | No | William L. Hutchinson and Donald Engle | Acquisition | 22,700,000 | |||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | No | Kamran Farhadi and James R. Damavandi | Refinance | 22,700,000 | |||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | No | William Simmons | Refinance | 22,200,000 | |||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | No | Robert Moser and Robert Morgan | Refinance | 20,600,000 | |||||||||
11.01 | Property | Affordable Malta | ||||||||||||||||
11.02 | Property | A Space Place | ||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | ||||||||||||||||
11.04 | Property | Snyders Best Rate | ||||||||||||||||
11.05 | Property | Affordable Wilton | ||||||||||||||||
11.06 | Property | Rotterdam Secured | ||||||||||||||||
11.07 | Property | Affordable Saratoga | ||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | No | Kenneth Shimm | Acquisition | 15,093,360 | ||||||||||
12.01 | Property | Walmart - Lawton | ||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | ||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | No | Jeff Morr | Acquisition | 14,600,000 | |||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | No | Stephen Swartz and Roland Guyot | Refinance | 14,200,000 | ||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | No | Arthur Lloyd Davidson, Jr. | Refinance | 12,500,000 | ||||||||||
15.01 | Property | Best Storage-Tudor Road | ||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | ||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | No | Myron Kaeding, Dr. Ambrish Gupta, Dr. Vimla Bhooshan and Dr. Yudh Gupta | Acquisition | 26,250,000 | |||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | No | H. Stevens Holtze III | Refinance | 11,200,000 | |||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | No | Thomas B. Brenneke and G. Nickolas Tri | Refinance | 10,700,000 | ||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | No | Mark P. Esbensen | Refinance | 10,100,000 | |||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | No | Timothy D. Davis, Robert J. Dailey, Thomas A. Dailey, William D. Schmicker and Dwight W. Davis | Refinance | 9,000,000 | ||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | No | H. Jackson Wallace and W.F. Trick | Refinance | 9,000,000 | ||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | No | Xavier F. Rosales | Refinance | 9,000,000 | ||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | No | Julie K. Lawton-Essa | Refinance | 7,875,000 | ||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | No | Michael B Willner | Refinance | 7,200,000 | |||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | No | Claudio Fernando Belocopitt | Acquisition | 6,625,000 | ||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | No | Charles G. Nickson | Refinance | 6,400,000 | ||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | No | Clifton D. Cabaness II, Scott James and John E. Baxter | Refinance | 6,300,000 | |||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | No | Kailash R. Kedia | Refinance | 6,150,000 | |||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | No | Steve Calderon and Carlos Melendez | Refinance | 6,000,000 | ||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | No | Grady Kromer, Cheryl Kromer and Grady Kromer, Trustee of the Kromer Family Trust | Refinance | 5,900,000 | ||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | No | Ralph W. Varnum and Kirby V. Deeter | Refinance | 5,835,000 | |||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | No | Robert Moser and Robert Morgan | Acquisition | 5,525,000 | ||||||||||
32.01 | Property | Cape May Court House Storage | ||||||||||||||||
32.02 | Property | North Cape May Storage | ||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | No | Alan Hayman | Refinance | 5,250,000 | |||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | No | Maurice Grondesky | Acquisition | 5,155,000 | ||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | No | Paul Johnson, Jr. | Refinance | 5,000,000 | ||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | ||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | |||||||||||||||
35.03 | Property | 11285 Commercial Parkway | ||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | ||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | ||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | No | Richard L. Walkup, Jr. | Refinance | 5,000,000 | |||||||||
36.01 | Property | Avondale Apartments | ||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | |||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | No | Jeff Morr | Acquisition | 4,900,000 | |||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | No | Howard Yates, Mark Yates, Richard Stein, Ellen Stein and Barry Nisen | Refinance | 4,700,000 | ||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | No | Donald J. Tenney, Carol A. Tenney | Refinance | 4,530,000 | ||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | No | Continental Properties Company, Inc. | Refinance | 4,300,000 |
A-31 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Delaware Statutory Trust? | Carve-out Guarantor | Loan Purpose | Loan Amount (sources) | |||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | No | Mohammed A. Shaikh and Rana Shaikh | Refinance | 3,900,000 | ||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | No | Dmitry Volkov | Acquisition | 3,800,000 | ||||||||||
42.01 | Property | Rite Aid - Manchester | ||||||||||||||||
42.02 | Property | Rite Aid - Catskill | ||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | No | Brad Hayosh | Acquisition | 3,675,000 | |||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | No | C. Robert Nicolls, II | Refinance | 3,600,000 | ||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | No | Charles B. Jordan | Refinance | 3,400,000 | ||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | No | W. Craig Turner | Refinance | 3,400,000 | |||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | No | Coco Y. Smith | Refinance | 3,200,000 | |||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | No | Timothy J. Judge | Refinance | 2,615,000 | ||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | No | Dan Israely | Refinance | 2,480,000 | |||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | No | Robert Moser and Robert Morgan | Acquisition | 2,350,000 |
A-32 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Principal’s New Cash Contribution (7) | Subordinate Debt | Other Sources | Total Sources | Loan Payoff | Purchase Price | Closing Costs | Reserves | Principal Equity Distribution | Other Uses | |||||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 0 | 0 | 225,000 | 100,225,000 | 95,925,089 | 0 | 1,112,039 | 2,686,535 | 501,338 | 0 | ||||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | 0 | 0 | 0 | 345,000,000 | 307,285,721 | 0 | 2,739,949 | 7,871,205 | 27,103,125 | 0 | |||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | |||||||||||||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | |||||||||||||||||||||||||||
2.03 | Property | 3101 Western Avenue | ||||||||||||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | |||||||||||||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | |||||||||||||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | |||||||||||||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | ||||||||||||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | |||||||||||||||||||||||||||
2.09 | Property | 18 West Mercer Street | ||||||||||||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | 0 | 0 | 0 | 259,000,000 | 131,719,468 | 0 | 1,738,333 | 2,897,247 | 122,644,953 | 0 | |||||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 0 | 0 | 38,500 | 42,038,500 | 29,464,773 | 0 | 286,078 | 1,315,290 | 10,972,359 | 0 | |||||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | 0 | 5,000,000 | 0 | 35,000,000 | 24,615,993 | 0 | 1,704,400 | 239,624 | 8,439,983 | 0 | |||||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | 0 | 0 | 70,000 | 29,570,000 | 21,941,681 | 0 | 951,614 | 727,281 | 5,949,423 | 0 | |||||||||||||||
6.01 | Property | Highpointe Corporate Park | ||||||||||||||||||||||||||||
6.02 | Property | Rockside Business Pointe | ||||||||||||||||||||||||||||
6.03 | Property | 8 | Southport Center | |||||||||||||||||||||||||||
6.04 | Property | MRN III | ||||||||||||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | 0 | 0 | 40,000 | 27,540,000 | 25,015,352 | 0 | 514,238 | 902,703 | 1,107,706 | 0 | ||||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 10,431,983 | 0 | 0 | 33,131,983 | 0 | 31,340,206 | 267,343 | 1,524,434 | 0 | 0 | |||||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 0 | 0 | 0 | 22,700,000 | 10,656,068 | 0 | 362,900 | 918,408 | 10,762,624 | 0 | |||||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | 0 | 0 | 0 | 22,200,000 | 19,234,929 | 0 | 277,609 | 156,206 | 2,531,256 | 0 | |||||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | 0 | 0 | 0 | 20,600,000 | 15,839,478 | 0 | 890,821 | 171,457 | 3,698,244 | 0 | |||||||||||||||
11.01 | Property | Affordable Malta | ||||||||||||||||||||||||||||
11.02 | Property | A Space Place | ||||||||||||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | ||||||||||||||||||||||||||||
11.04 | Property | Snyders Best Rate | ||||||||||||||||||||||||||||
11.05 | Property | Affordable Wilton | ||||||||||||||||||||||||||||
11.06 | Property | Rotterdam Secured | ||||||||||||||||||||||||||||
11.07 | Property | Affordable Saratoga | ||||||||||||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | 4,613,353 | 0 | 855,178 | 20,561,891 | 0 | 20,124,482 | 396,809 | 40,600 | 0 | 0 | ||||||||||||||||
12.01 | Property | Walmart - Lawton | ||||||||||||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | ||||||||||||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 7,954,484 | 0 | 40,000 | 22,594,484 | 0 | 21,500,000 | 605,984 | 488,500 | 0 | 0 | |||||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 0 | 0 | 0 | 14,200,000 | 11,421,703 | 0 | 287,932 | 0 | 2,490,365 | 0 | ||||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | 0 | 0 | 45,000 | 12,545,000 | 9,513,271 | 0 | 251,526 | 209,460 | 2,570,742 | 0 | ||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | ||||||||||||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | ||||||||||||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | 9,915,247 | 0 | 98,293 | 36,263,540 | 0 | 30,000,000 | 1,230,062 | 5,033,478 | 0 | 0 | |||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 0 | 0 | 40,000 | 11,240,000 | 9,450,760 | 0 | 484,699 | 70,232 | 1,234,309 | 0 | |||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | 0 | 0 | 0 | 10,700,000 | 6,756,984 | 0 | 290,527 | 70,121 | 3,582,368 | 0 | ||||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | 11,294 | 0 | 0 | 10,111,294 | 9,856,689 | 0 | 173,228 | 81,376 | 0 | 0 | |||||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | 0 | 0 | 35,000 | 9,035,000 | 5,137,969 | 0 | 204,316 | 40,929 | 3,651,786 | 0 | ||||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | 0 | 0 | 0 | 9,000,000 | 6,747,466 | 0 | 230,398 | 61,983 | 1,960,153 | 0 | ||||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | 4,592,244 | 0 | 40,000 | 13,632,244 | 12,388,714 | 0 | 920,363 | 323,167 | 0 | 0 | ||||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | 0 | 0 | 27,500 | 7,902,500 | 6,665,354 | 0 | 586,089 | 82,432 | 568,625 | 0 | ||||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | 0 | 0 | 0 | 7,200,000 | 2,035,000 | 0 | 73,426 | 684,024 | 4,407,550 | 0 | |||||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 4,192,227 | 0 | 50,000 | 10,867,227 | 0 | 10,500,000 | 190,479 | 176,748 | 0 | 0 | ||||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | 0 | 0 | 30,000 | 6,430,000 | 4,344,875 | 0 | 154,976 | 95,920 | 1,834,228 | 0 | ||||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | 0 | 0 | 20,000 | 6,320,000 | 4,658,263 | 0 | 202,991 | 1,295,781 | 162,966 | 0 | |||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 45,000 | 0 | 0 | 6,195,000 | 4,348,338 | 0 | 511,235 | 1,335,427 | 0 | 0 | |||||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 0 | 0 | 0 | 6,000,000 | 4,182,462 | 0 | 176,111 | 358,580 | 1,282,847 | 0 | ||||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | 0 | 0 | 0 | 5,900,000 | 4,704,728 | 0 | 130,189 | 76,973 | 988,110 | 0 | ||||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 0 | 0 | 40,000 | 5,875,000 | 4,368,508 | 0 | 161,814 | 211,482 | 1,133,196 | 0 | |||||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | 1,515,519 | 0 | 0 | 7,040,519 | 0 | 6,695,000 | 314,067 | 31,451 | 0 | 0 | ||||||||||||||||
32.01 | Property | Cape May Court House Storage | ||||||||||||||||||||||||||||
32.02 | Property | North Cape May Storage | ||||||||||||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 2,600,047 | 0 | 50,000 | 7,900,047 | 7,300,000 | 0 | 91,667 | 508,380 | 0 | 0 | |||||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | 2,883,908 | 0 | 0 | 8,038,908 | 0 | 7,885,000 | 153,908 | 0 | 0 | 0 | ||||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | 0 | 0 | 0 | 5,000,000 | 3,275,158 | 0 | 146,958 | 54,452 | 1,523,432 | 0 | ||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | ||||||||||||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | |||||||||||||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | ||||||||||||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | ||||||||||||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | ||||||||||||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | 47,950 | 0 | 0 | 5,047,950 | 3,502,082 | 0 | 175,600 | 873,316 | 496,953 | 0 | |||||||||||||||
36.01 | Property | Avondale Apartments | ||||||||||||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | |||||||||||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | 3,358,201 | 0 | 40,000 | 8,298,201 | 0 | 7,500,000 | 318,008 | 480,192 | 0 | 0 | |||||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | 0 | 0 | 30,000 | 4,730,000 | 3,104,063 | 0 | 179,850 | 631,971 | 814,115 | 0 | ||||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | 0 | 0 | 32,000 | 4,562,000 | 3,513,456 | 0 | 107,551 | 0 | 940,993 | 0 | ||||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | 0 | 0 | 60,000 | 4,360,000 | 4,086,100 | 0 | 162,174 | 342 | 111,384 | 0 |
A-33 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Principal’s New Cash Contribution (7) | Subordinate Debt | Other Sources | Total Sources | Loan Payoff | Purchase Price | Closing Costs | Reserves | Principal Equity Distribution | Other Uses | |||||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | 0 | 0 | 0 | 3,900,000 | 3,106,004 | 0 | 156,380 | 309,483 | 328,133 | 0 | ||||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | 2,238,140 | 0 | 30,000 | 6,068,140 | 0 | 5,783,746 | 284,394 | 0 | 0 | 0 | ||||||||||||||||
42.01 | Property | Rite Aid - Manchester | ||||||||||||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | ||||||||||||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | 1,637,883 | 0 | 25,000 | 5,337,883 | 0 | 4,650,000 | 260,205 | 427,678 | 0 | 0 | |||||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | 0 | 0 | 47,500 | 3,647,500 | 2,743,227 | 0 | 164,240 | 112,386 | 627,646 | 0 | ||||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | 192,666 | 0 | 0 | 3,592,666 | 3,083,908 | 0 | 187,706 | 321,052 | 0 | 0 | ||||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 0 | 0 | 50,000 | 3,450,000 | 3,035,291 | 0 | 184,301 | 134,895 | 95,513 | 0 | |||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | 0 | 0 | 35,000 | 3,235,000 | 1,508,750 | 0 | 174,862 | 29,443 | 1,521,945 | 0 | |||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | 0 | 0 | 35,000 | 2,650,000 | 2,044,007 | 0 | 134,014 | 84,548 | 387,431 | 0 | ||||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 0 | 0 | 30,000 | 2,510,000 | 1,895,403 | 0 | 155,366 | 199,905 | 259,325 | 0 | |||||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | 773,499 | 0 | 0 | 3,123,499 | 0 | 2,850,000 | 262,303 | 11,196 | 0 | 0 |
A-34 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Total Uses | Lockbox | Cash Management | Cash Management Triggers | Ground Lease Y/N | ||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | 100,225,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.30x, (iii) the occurrence of a Specified Tenant Trigger Period | No | |||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | 345,000,000 | Hard | In Place | (i) the occurrence of an Event of Default, (ii) Net Operating Income is less than 80% of Closing Date NOI, (iii) failure to deliver financial statements as required in the Loan Agreement | |||||||||||
2.01 | Property | 11 | 1000 Second Avenue | No | ||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | No | ||||||||||||||||
2.03 | Property | 3101 Western Avenue | No | |||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | No | ||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | No | ||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | No | ||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | No | |||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | No | ||||||||||||||||
2.09 | Property | 18 West Mercer Street | No | |||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | 259,000,000 | Hard | In Place | (i) the occurrence of an Event of Default, (ii) Net Operating Income is less than 80% of Closing Date NOI, (iii) failure to deliver financial statements as required in the Loan Agreement | No | ||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | 42,038,500 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.15x | No | ||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | 35,000,000 | Hard | In-Place | (i) the occurrence of an Event of Default, (ii) the occurrence of a Mezzanine Trigger Period (iii) DSCR is less than 1.10x, (iv) the occurrence of a Specified Tenant Trigger Period | No | ||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | 29,570,000 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.25x, (iii) the occurrence of a Specified Tenant Trigger Period | |||||||||||
6.01 | Property | Highpointe Corporate Park | No | |||||||||||||||||
6.02 | Property | Rockside Business Pointe | No | |||||||||||||||||
6.03 | Property | 8 | Southport Center | No | ||||||||||||||||
6.04 | Property | MRN III | No | |||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | 27,540,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) Bankruptcy action of the Borrower, Guarantor or Manager, (iii) DSCR is less than 1.20x | No | |||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | 33,131,983 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) Net Operating Income is less than 85% of Closing Date NOI, (iii) failure to deliver financial statements as required in the Loan Agreement, (iv) the occurrence of a Rollover Trigger Event | No | ||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | 22,700,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) Net Operating Income is less than 80% of Closing Date NOI, (iii) failure to deliver financial statements as required in the Loan Agreement | No | ||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | 22,200,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) Net Operating Income is less than 75% of Closing Date NOI, (iii) failure to deliver financial statements as required in the Loan Agreement, (iv) the occurrence of an Albertsons/Rite Aid Trigger Period | No | ||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | 20,600,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) Bankruptcy action of the Borrower, Guarantor or Manager, (iii) DSCR is less than 1.20x | |||||||||||
11.01 | Property | Affordable Malta | No | |||||||||||||||||
11.02 | Property | A Space Place | No | |||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | No | |||||||||||||||||
11.04 | Property | Snyders Best Rate | No | |||||||||||||||||
11.05 | Property | Affordable Wilton | No | |||||||||||||||||
11.06 | Property | Rotterdam Secured | No | |||||||||||||||||
11.07 | Property | Affordable Saratoga | No | |||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | 20,561,891 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.15x, (iii) the occurrence of a Specified Tenant Trigger Period | ||||||||||||
12.01 | Property | Walmart - Lawton | No | |||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | No | |||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | 22,594,484 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) Bankruptcy action of the Borrower, Guarantor or Manager, (iii) DSCR is less than 1.20x, (iv) the occurrence of a Critical Tenant Trigger Event, (v) the occurrence of the Mandatory Cash Sweep Trigger Date | No | ||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | 14,200,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.10x, (iii) failure to deliver financial statements as required in the Loan Agreement, (iv) the occurrence of a Rollover Trigger Event | No | |||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | 12,545,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.20x | ||||||||||||
15.01 | Property | Best Storage-Tudor Road | No | |||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | No | |||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | 36,263,540 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.20x, (iii) the occurrence of an Event of Default Franchise Agreement, (iv) the termination of any Franchise Agreement, (v) the date that is one year prior to the scheduled expiration date of the Franchise Agreement and (vi) the occurrence of Manager taking any Material Action | No | ||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | 11,240,000 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.25x, (iii) the occurrence of a License Agreement Trigger Event, (iv) the occurrence of a License Renewal Trigger Event | No | ||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | 10,700,000 | None | None | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.10x, (iii) failure to deliver financial statements as required in the Loan Agreement | No | |||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | 10,111,294 | Soft Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.15x, (iii) Debt Yield is less than 7.4%, (iv) the occurrence of a Specified Tenant Trigger Period | No | ||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | 9,035,000 | Springing | Springing | (i) the occurrence of an Event of Default | No | |||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | 9,000,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) Net Operating Income is less than 85% of Closing Date NOI, (iii) failure to deliver financial statements as required in the Loan Agreement | No | |||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | 13,632,244 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.20x, (iii) the occurrence of a Specified Tenant Trigger Period | No | |||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | 7,902,500 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.20x | No | |||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | 7,200,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.10x | No | ||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | 10,867,227 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.20x, (iii) the occurrence of a Specified Tenant Trigger Period | No | |||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | 6,430,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) Bankruptcy action of the Borrower, Guarantor or Manager, (iii) DSCR is less than 1.20x | No | |||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | 6,320,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.15x | No | ||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | 6,195,000 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.15x, (iii) Debt Yield is less than 7.4%, (iv) the occurrence of a Specified Tenant Trigger Period | No | ||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | 6,000,000 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.15x, (iii) the occurrence of a Material Tenant Trigger Period | No | |||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | 5,900,000 | None | None | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.10x, (iii) failure to deliver financial statements as required in the Loan Agreement | No | |||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | 5,875,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) Bankruptcy action of the Borrower, Guarantor or Manager, (iii) DSCR is less than 1.20x, (iv) the occurrence of a Critical Tenant Trigger Event | No | ||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | 7,040,519 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) Bankruptcy action of the Borrower, Guarantor or Manager, (iii) DSCR is less than 1.20x | ||||||||||||
32.01 | Property | Cape May Court House Storage | No | |||||||||||||||||
32.02 | Property | North Cape May Storage | No | |||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | 7,900,047 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.25x, (iii) the occurrence of a Specified Tenant Trigger Period | No | ||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | 8,038,908 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.10x, (iii) the occurrence of a Specified Tenant Trigger Period | No | |||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | 5,000,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.25x, (iii) failure to deliver financial statements as required in the Loan Agreement | ||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | No | |||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | No | ||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | No | |||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | No | |||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | No | |||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | 5,047,950 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.15x, (iii) Debt Yield is less than 7.0%, (iv) the occurrence of a Leasing Threshold Trigger Event | |||||||||||
36.01 | Property | Avondale Apartments | No | |||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | No | ||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | 8,298,201 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) Bankruptcy action of the Borrower, Guarantor or Manager, (iii) DSCR is less than 1.20x, (iv) the occurrence of a Critical Tenant Trigger Event | No | ||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | 4,730,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.15x | No | |||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | 4,562,000 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.10x, (iii) the occurrence of a Specified Tenant Trigger Period | No | |||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | 4,360,000 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.00x, (iii) the occurrence of a Specified Tenant Trigger Period | Yes |
A-35 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Total Uses | Lockbox | Cash Management | Cash Management Triggers | Ground Lease Y/N | ||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | 3,900,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.20x | No | |||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | 6,068,140 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.25x, (iii) the occurrence of a Specified Tenant Trigger Period | ||||||||||||
42.01 | Property | Rite Aid - Manchester | No | |||||||||||||||||
42.02 | Property | Rite Aid - Catskill | No | |||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | 5,337,883 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.20x, (iii) the occurrence of a Specified Tenant Trigger Period, (iv) the occurrence and continuance of a Parking Trigger Period | No | ||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | 3,647,500 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.25x | No | |||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | 3,592,666 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.10x | No | |||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | 3,450,000 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.20x, (iii) the occurrence of a Franchise Agreement Trigger Period, (iv) the occurrence of a Franchise Renewal Trigger Event, (v) Bankruptcy action of the Manager | No | ||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | 3,235,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) Bankruptcy action of the Borrower, Guarantor or Manager, (iii) DSCR is less than 1.30x | No | ||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | 2,650,000 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.25x | No | |||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 2,510,000 | Hard | Springing | (i) the occurrence of an Event of Default, (ii) DSCR is less than 1.25x, (iii) the occurrence of a Specified Tenant Trigger Period | Yes | ||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | 3,123,499 | Springing | Springing | (i) the occurrence of an Event of Default, (ii) Bankruptcy action of the Borrower, Guarantor or Manager, (iii) DSCR is less than 1.20x | No |
A-36 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Ground Lease Expiration Date | Annual Ground Lease Payment ($) | Cut-off Date B Note Balance ($) | B Note Interest Rate | Cut-off Date Mezzanine Debt Balance ($) | Mezzanine Debt Interest Rate | Terrorism Insurance Required | Control Number | |||||||||||||
1 | Loan | CGMRC | CGMRC | 135 South LaSalle | Yes | 1 | ||||||||||||||||||||
2 | Loan | 8, 9, 10 | GSMC | GSMC | Selig Office Portfolio | Yes | 2 | |||||||||||||||||||
2.01 | Property | 11 | 1000 Second Avenue | Yes | 2.01 | |||||||||||||||||||||
2.02 | Property | 8, 12 | 2901 Third Avenue | Yes | 2.02 | |||||||||||||||||||||
2.03 | Property | 3101 Western Avenue | Yes | 2.03 | ||||||||||||||||||||||
2.04 | Property | 13 | 300 Elliott Avenue West | Yes | 2.04 | |||||||||||||||||||||
2.05 | Property | 8, 14 | 3131 Elliott Avenue | Yes | 2.05 | |||||||||||||||||||||
2.06 | Property | 8 | 2615 Fourth Avenue | Yes | 2.06 | |||||||||||||||||||||
2.07 | Property | 190 Queen Anne Avenue North | Yes | 2.07 | ||||||||||||||||||||||
2.08 | Property | 8, 15 | 200 First Avenue West | Yes | 2.08 | |||||||||||||||||||||
2.09 | Property | 18 West Mercer Street | Yes | 2.09 | ||||||||||||||||||||||
3 | Loan | 16, 17, 18, 19, 20 | GSMC | GSMC | Dallas Market Center | Yes | 3 | |||||||||||||||||||
4 | Loan | 21 | CGMRC | CGMRC | Pasadena Office Tower | Yes | 4 | |||||||||||||||||||
5 | Loan | 8, 22 | RAIT Funding, LLC | RAIT Funding, LLC | St. Anthony’s Healthplex North | 4,988,178 | 9.9900% | Yes | 5 | |||||||||||||||||
6 | Loan | 8, 23 | CGMRC | CGMRC | Rockside Road Office Portfolio | Yes | 6 | |||||||||||||||||||
6.01 | Property | Highpointe Corporate Park | Yes | 6.01 | ||||||||||||||||||||||
6.02 | Property | Rockside Business Pointe | Yes | 6.02 | ||||||||||||||||||||||
6.03 | Property | 8 | Southport Center | Yes | 6.03 | |||||||||||||||||||||
6.04 | Property | MRN III | Yes | 6.04 | ||||||||||||||||||||||
7 | Loan | RMF | RMF | Chalet Garden Apartments | Yes | 7 | ||||||||||||||||||||
8 | Loan | 24 | GSMC | GSMC | Orinda Square | Yes | 8 | |||||||||||||||||||
9 | Loan | 8, 19, 25 | GSMC | GSMC | Park at Sugar Creek | Yes | 9 | |||||||||||||||||||
10 | Loan | 26 | GSMC | GSMC | Mesa Town Center | Yes | 10 | |||||||||||||||||||
11 | Loan | 27 | RMF | RMF | NY Seven Self Storage Portfolio | Yes | 11 | |||||||||||||||||||
11.01 | Property | Affordable Malta | Yes | 11.01 | ||||||||||||||||||||||
11.02 | Property | A Space Place | Yes | 11.02 | ||||||||||||||||||||||
11.03 | Property | Dix Ave Mini Storage | Yes | 11.03 | ||||||||||||||||||||||
11.04 | Property | Snyders Best Rate | Yes | 11.04 | ||||||||||||||||||||||
11.05 | Property | Affordable Wilton | Yes | 11.05 | ||||||||||||||||||||||
11.06 | Property | Rotterdam Secured | Yes | 11.06 | ||||||||||||||||||||||
11.07 | Property | Affordable Saratoga | Yes | 11.07 | ||||||||||||||||||||||
12 | Loan | CGMRC | CGMRC | Oklahoma Walmart Portfolio | Yes | 12 | ||||||||||||||||||||
12.01 | Property | Walmart - Lawton | Yes | 12.01 | ||||||||||||||||||||||
12.02 | Property | Walmart - Oklahoma City | Yes | 12.02 | ||||||||||||||||||||||
13 | Loan | 8 | RMF | RMF | Promenades Plaza | Yes | 13 | |||||||||||||||||||
14 | Loan | GSMC | GSMC | Hagerstown Plaza | Yes | 14 | ||||||||||||||||||||
15 | Loan | CGMRC | CGMRC | Best Storage Portfolio | Yes | 15 | ||||||||||||||||||||
15.01 | Property | Best Storage-Tudor Road | Yes | 15.01 | ||||||||||||||||||||||
15.02 | Property | Best Storage-Woodland Drive | Yes | 15.02 | ||||||||||||||||||||||
16 | Loan | 8, 28, 29 | CGMRC | CGMRC | Crowne Plaza Bloomington | Yes | 16 | |||||||||||||||||||
17 | Loan | 8 | CGMRC | CGMRC | Magnolia Hotel Omaha | Yes | 17 | |||||||||||||||||||
18 | Loan | GSMC | GSCRE | Oakmont Apartments | Yes | 18 | ||||||||||||||||||||
19 | Loan | 30 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Butterfield Shopping Center | Yes | 19 | |||||||||||||||||||
20 | Loan | CGMRC | CGMRC | CSS Kaneohe | Yes | 20 | ||||||||||||||||||||
21 | Loan | GSMC | GSCRE | Cottage Landing Apartments | Yes | 21 | ||||||||||||||||||||
22 | Loan | CGMRC | CGMRC | Gables CitiTower | Yes | 22 | ||||||||||||||||||||
23 | Loan | CGMRC | CGMRC | Avalon Apartments | Yes | 23 | ||||||||||||||||||||
24 | Loan | 8, 31, 32 | RAIT Funding, LLC | RAIT Funding, LLC | Shippensburg Shopping Center | Yes | 24 | |||||||||||||||||||
25 | Loan | CGMRC | CGMRC | Black Rock Commons | Yes | 25 | ||||||||||||||||||||
26 | Loan | RMF | RMF | Deer Park Gardens | Yes | 26 | ||||||||||||||||||||
27 | Loan | 33 | CGMRC | CGMRC | Stonegate at Stillwater | Yes | 27 | |||||||||||||||||||
28 | Loan | 8 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Infinity Corporate Center | Yes | 28 | |||||||||||||||||||
29 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Diamonette Building | Yes | 29 | ||||||||||||||||||||
30 | Loan | GSMC | GSCRE | Truckee River Terraces | Yes | 30 | ||||||||||||||||||||
31 | Loan | 34 | RMF | RMF | College Village Shopping Center | Yes | 31 | |||||||||||||||||||
32 | Loan | RMF | RMF | Cape May Portfolio | Yes | 32 | ||||||||||||||||||||
32.01 | Property | Cape May Court House Storage | Yes | 32.01 | ||||||||||||||||||||||
32.02 | Property | North Cape May Storage | Yes | 32.02 | ||||||||||||||||||||||
33 | Loan | 8 | CGMRC | CGMRC | Northfield Office Complex | Yes | 33 | |||||||||||||||||||
34 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Walgreens-Smithfield | Yes | 34 | ||||||||||||||||||||
35 | Loan | GSMC | GSMC | Castroville Industrial Portfolio | Yes | 35 | ||||||||||||||||||||
35.01 | Property | 1081 and 1083 Harkins Road | Yes | 35.01 | ||||||||||||||||||||||
35.02 | Property | 35 | 11145 and 11165 Commercial Parkway | Yes | 35.02 | |||||||||||||||||||||
35.03 | Property | 11285 Commercial Parkway | Yes | 35.03 | ||||||||||||||||||||||
35.04 | Property | 11085 Commercial Parkway | Yes | 35.04 | ||||||||||||||||||||||
35.05 | Property | 11325 Commercial Parkway | Yes | 35.05 | ||||||||||||||||||||||
36 | Loan | 8, 36 | KGS | KGS-Alpha Real Estate Capital Markets, LLC | Chester County Multifamily Portfolio | Yes | 36 | |||||||||||||||||||
36.01 | Property | Avondale Apartments | Yes | 36.01 | ||||||||||||||||||||||
36.02 | Property | 8, 37 | Granite Court | Yes | 36.02 | |||||||||||||||||||||
37 | Loan | 8 | RMF | RMF | Highlands Plaza | Yes | 37 | |||||||||||||||||||
38 | Loan | CGMRC | CGMRC | Apple Creek Apartments | Yes | 38 | ||||||||||||||||||||
39 | Loan | CGMRC | CGMRC | Walgreens Winston-Salem | Yes | 39 | ||||||||||||||||||||
40 | Loan | CGMRC | CGMRC | Kohl’s Tallahassee FL | 1/31/2028 | 192,500 | Yes | 40 |
A-37 |
CGCMT 2015-GC31 Annex A | ||||||||||||||||||||||||||
Control Number | Loan / Property Flag | Footnotes | Mortgage Loan Seller | Originator | Property Name | Ground Lease Expiration Date | Annual Ground Lease Payment ($) | Cut-off Date B Note Balance ($) | B Note Interest Rate | Cut-off Date Mezzanine Debt Balance ($) | Mezzanine Debt Interest Rate | Terrorism Insurance Required | Control Number | |||||||||||||
41 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Blue Bell Heights/Skyline Village | Yes | 41 | ||||||||||||||||||||
42 | Loan | CGMRC | CGMRC | Rite Aid Portfolio | Yes | 42 | ||||||||||||||||||||
42.01 | Property | Rite Aid - Manchester | Yes | 42.01 | ||||||||||||||||||||||
42.02 | Property | Rite Aid - Catskill | Yes | 42.02 | ||||||||||||||||||||||
43 | Loan | 8, 38 | CGMRC | CGMRC | 210 West Huron | Yes | 43 | |||||||||||||||||||
44 | Loan | CGMRC | CGMRC | Eagle’s Pointe Apartments | Yes | 44 | ||||||||||||||||||||
45 | Loan | RAIT Funding, LLC | RAIT Funding, LLC | Dorchester Village Apartments | Yes | 45 | ||||||||||||||||||||
46 | Loan | 8, 39 | CGMRC | CGMRC | AmericInn - Eagle Colorado | Yes | 46 | |||||||||||||||||||
47 | Loan | 40 | RMF | RMF | Golden Triangle Self Storage | Yes | 47 | |||||||||||||||||||
48 | Loan | CGMRC | CGMRC | Metro Storage | Yes | 48 | ||||||||||||||||||||
49 | Loan | 41 | CGMRC | CGMRC | Cedar - Dover Plaza | 11/30/2016 | 8,760 | Yes | 49 | |||||||||||||||||
50 | Loan | 42 | RMF | RMF | On-Site Self Storage | Yes | 50 |
A-38 |
Footnotes to Annex A | |
(1) | The Administrative Fee Rate includes the Servicing Fee Rate, the Operating Advisor Fee Rate, the Trustee/Certificate Administrator Fee Rate and the CREFC® Intellectual Property Royalty License Fee Rate applicable to each Mortgage Loan. |
(2) | The monthly debt service shown for Mortgage Loans with a partial interest-only period reflects the amount payable after the expiration of the interest-only period. |
(3) | The open period is inclusive of the Maturity Date or Anticipated Repayment Date. |
(4) | Underwritten NCF DSCR is calculated based on amortizing debt service payments (except for interest-only loans). |
(5) | Occupancy reflects tenants that have signed leases, but are not yet in occupancy or may not be paying rent. |
(6) | The lease expirations shown are based on full lease terms; however, in some instances, the tenant may have the option to terminate its lease prior to the expiration date shown. In addition, in some instances, a tenant may have the right to assign its lease or sublease the leased premises and be released from its obligations under the lease. |
(7) | If the purpose of the Mortgage Loan was to finance an acquisition of the Mortgaged Property, the field “Principal’s New Cash Contribution” reflects the cash investment by one or more of the equity owners in the borrower in connection with such acquisition. If the purpose of the Mortgage Loan was to refinance the Mortgaged Property, the field “Principal’s New Cash Contribution” reflects the cash contributed to the borrower by one or more of the equity owners at the time the Mortgage Loan was originated. |
(8) | The Appraised Value presents the “As-Is” Appraised Value of the Mortgaged Property. The Cut-off Date LTV Ratio is calculated on the basis of such “As-Is” Appraised Value. The LTV Ratio at Maturity/ARD is calculated on the basis of the “As Stabilized” Appraised Value. |
(9) | The Cut-off Date Balance of $72,000,000 represents note A-3 of a $345,000,000 whole loan evidenced by multiple pari passu notes. Note A-1, with a Cut-off Date Balance of $125,000,000 was contributed to CGCMT 2015-GC29. Note A-2, with a Cut-off Date Balance of $123,000,000 was contributed to GSMS 2015-GC30. One remaining companion loan with a Cut-off Date Balance of $25,000,000 that is held outside the issuing entity and is expected to be contributed to a future securitization. Cut-off Date LTV Ratio, LTV Ratio at Maturity/ARD, Underwritten NCF DSCR, Debt Yield on Underwritten Net Operating Income, Debt Yield on Underwritten Net Cash Flow and Loan Per Unit calculations are based on the aggregate cut-off date principal balance of $345,000,000. |
(10) | The lockout period will be at least 27 payment dates beginning with and including the first payment date of May 6, 2015. For the purposes of this Prospectus Supplement, the assumed lockout period of 27 payment dates is based on the expected CGCMT 2015-GC31 securitization closing date in July 2015. The actual lockout period may be longer. |
(11) | The Largest Tenant, DDB Seattle, currently subleases 51,179 SF of its space to ThePlatform through its lease expiration on March 31, 2018. ThePlatform has executed a lease on floors 9, 10 and 11 that commences on April 1, 2018 and expires on March 31, 2023. |
(12) | The Largest Tenant, Washington State Ferries, signed a 5-year lease extension on March 11, 2015 for 86,510 SF of its space, will vacate the remaining 37,864 SF in August 2015 and will continue to pay rent on the full 124,374 SF through August 2015. |
(13) | The Largest Tenant, Holland America, is expected to vacate all of its space at the end of its lease term in December 2016. Holland America has the right to contract its space by up to 10% per year on a noncumulative basis. However the premises may not be reduced below 71,300 SF. |
(14) | The Largest Tenant, Emeritus Corporation, currently subleases 7,969 SF of its space to TCS & Starquest Expeditions, Inc. and 26,386 SF of its space to Hart-Crowser. |
(15) | Occupancy includes 7,826 SF for the Largest Tenant, CKCA2 Inc. (Cosmo Kids), and 6,816 SF for the Second Largest Tenant, Koru Careers, Inc., which have executed leases and are expected to take occupancy on August 1, |
A-39 |
2015 and July 1, 2015, respectively. We cannot assure you that these tenants will take occupancy or begin paying rent as expected or at all. | |
(16) | The Cut-off Date Balance of $71,803,978 represents the note A-2 of a $259,000,000 whole loan evidenced by multiple pari passu notes. Note A-1, with a Cut-off Date Balance of $129,646,071 was contributed to GSMS 2015-GC30. One remaining companion loan with a Cut-off Date Balance of $56,844,816 that is held outside the issuing entity and is expected to be contributed to a future securitization. Cut-off Date LTV Ratio, LTV Ratio at Maturity/ARD, Underwritten NCF DSCR, Debt Yield on Underwritten Net Operating Income, Debt Yield on Underwritten Net Cash Flow and Loan Per Unit calculations are based on the aggregate Cut-off Date Balance of $258,294,865. |
(17) | The lockout period will be at least 26 payment dates beginning with and including the first payment date of June 6, 2015. For the purposes of this Prospectus Supplement, the assumed lockout period of 26 payment dates is based on the expected CGCMT 2015-GC31 securitization closing date in July 2015. The actual lockout period may be longer. |
(18) | Occupancy is based on permanent showroom space and 82,630 SF of administrative office space (utilized by property management) and excludes the 377,000 SF of temporary show space. |
(19) | For tenants with multiple lease expirations, the expiration date associated with the largest square footage is shown. |
(20) | Historical cash flows reflect a February fiscal year-end. |
(21) | Ongoing TI/LC Reserves are waived beginning with the First Monthly Payment Date and continuing through and including the due date occurring in December 2017. On the due date occurring in January 2018, to the extent the TI/LC Reserve balance exceeds $170,000, the lender will disburse to the borrower the amount of TI/LC Reserve funds that is in excess of $170,000 such that the balance of the TI/LC Reserve will be $170,000 on such due date. Beginning on the due date occurring in January 2018, the borrower is required to begin making monthly payments of $14,167, subject to the TI/LC Reserve Cap of $450,000. |
(22) | The mortgage loan amortizes based on a non-standard amortization schedule and the Underwritten NCF DSCR (1.64x) is calculated based on the aggregate debt service for the 12-month period starting August 1, 2015. See Annex G in the Prospectus Supplement for the related amortization schedule. The Appraised Value presents the “As-Is” Appraised Value of the Mortgaged Property. The Cut-off Date LTV Ratio is calculated on the basis of such “As-Is” Appraised Value, as the conditions for stabilization have not yet been met as of the date hereof. The LTV Ratio at Maturity is calculated in whole or in part on the basis of the “Prospective Market Value Upon Stabilization” Appraised Value. |
(23) | The Appraised Value and As Stabilized Appraised Value both reflect a 5% portfolio premium applied by the appraiser to the Rockside Office Portfolio Properties as a portfolio. The sum of the individual Appraised Values and As Stabilized Values for the individual Rockside Office Portfolio Properties disregarding the appraiser’s portfolio premium are $40,450,000 and $41,550,000 respectively. |
(24) | Occupancy includes 7,154 SF of space for three tenants, collectively representing 7.9% of the net rentable area, including the fifth largest tenant, Coldwell Banker Residential, which has executed a lease for an additional 2,996 SF (bringing its total to 5,606 SF) and is expected to take occupancy and begin paying rent on the additional space in September 2015. We cannot assure you that these tenants will take occupancy or begin paying rent as expected or at all. |
(25) | Occupancy includes (i) Plaza Jewelers (10,062 SF) which is temporarily occupying 5,981 SF of in-line space until the build-out of its outparcel is complete (expected at the end of June 2015) and (ii) Majestic Kids (6,003 SF) which has executed a lease, but has not yet opened for business or begun paying rent. We cannot assure you that these tenants will take occupancy or begin paying rent as expected or at all. |
(26) | Seafood City currently subleases its space directly from Albertsons. The lease expiration characteristic for this Mortgage Loan represents the terms of the Albertsons Lease. |
(27) | The Appraised Value is the “as-is” bulk portfolio value. The combined “as-is” individual appraised value is $28,380,000. The Cut-off Date LTV Ratio and Maturity Date LTV Ratio are based on the “as-is” bulk portfolio |
A-40 |
value. The Cut-off Date LTV Ratio and Maturity Date LTV Ratio based on the combined “as-is” individual appraised value of $28,380,000 are 72.4% and 58.5%, respectively. | |
(28) | The Cut-off Date Balance of $12,170,872 represents the A-2 note of a $26,250,000 loan combination evidenced by twopari passu notes. The companion loan is evidenced by the A-1 note with a principal balance of $13,909,568 as of the Cut-off Date, which was contributed to the CGCMT 2015-GC29 securitization transaction. Cut-off Date LTV Ratio, LTV Ratio at Maturity/ARD, Underwritten NCF DSCR, Debt Yield on Underwritten Net Operating Income, Debt Yield on Underwritten Net Cash Flow and Loan Per Unit calculations are based on the aggregate Cut-off Date Balance of $26,080,440. |
(29) | The Cut-off Date LTV Ratio is calculated using the appraisal’s “as-is” Appraised Value of $31,900,000 plus the amount of PIP required under the franchise agreement ($3,689,846). The Cut-off Date LTV Ratio calculated using solely the “as-is” Appraised Value is 81.8%. |
(30) | The Ongoing TI/LC Reserve for the first 24 months of the Loan term will be paid in accordance with a schedule set forth in the loan agreement. The Ongoing TI/LC Reserve payments are calculated to be the difference between the IO debt service payment and the amortizing debt service payment. In accordance with the Loan Agreement, on the 25th monthly payment date and every monthly payment date of the Loan term thereafter, the Borrower is required to deposit $2,500.00 into the Leasing Reserve. |
(31) | The borrower is required to fund an Ongoing Replacement Reserve in the amount of $1,647.65 on each monthly payment date until such time that the reserve balance equals $59,315.40. In the event the reserve is less than $19,771.80 and/or an event of default exists, the borrower’s obligation to make monthly deposits recommences until the reserve balance equals $59,315.40, or such event of default is cured. |
(32) | The borrower is required to fund an Ongoing TI/LC Reserve in the amount of $5,492.17 on each monthly payment date until such time that the reserve balance equals $197,718.00. In the event the reserve is less than $131,812.00 and/or an event of default exists, the borrower’s obligation to make monthly deposits recommences until the reserve balance equals $197,718.00 or such event of default is cured. |
(33) | The Cut-off Date LTV Ratio is calculated net of the $825,000 economic holdback reserve. The Cut-off Date LTV Ratio calculated based upon the fully funded Mortgage Loan amount of $6,300,000 and “as-is” Appraised Value of $9,600,000 is 65.6%. |
(34) | The Fourth Largest Tenant at the Mortgaged Property, College Optical Shop, has a termination option if either of two original partners dies or becomes so disabled that the partner cannot practice optometry, the surviving partner may terminate the lease upon 6 months notice. |
(35) | The SEL shown represents the weighted average SEL of the two buildings comprising the Mortgaged Property. The building located at 11145 Commercial Parkway has an SEL of 19% and the building located at 11165 Commercial Parkway has an SEL of 22%. |
(36) | At origination, the ACC Holdback of $340,000 was taken to cover the cost to reinstate the Sponsor’s personal residential mortgages. The Sponsor will have 30 days to reinstate his personal residential mortgages. As long as the Sponsor reinstates his personal residential mortgages, the funds will be reimbursed. In the event the sponsor does not reinstate his residential mortgages, the funds may be held as additional collateral for the Loan. |
(37) | The property currently has 15 units that are 100% occupied. The Borrower is in the process of renovating a four bedroom single-family house that is part of the collateral and located on the corner of the property, which will become the 16th unit. Until the unit is fully renovated and up for lease, the four bedroom single-family house will be excluded from property’s occupancy calculation. The 16th unit is expected to be completed on or around 6/1/2016. |
(38) | Provided each of the Mlive, Deepfield, and Flagstar Bank leases do not expire any earlier than three years beyond the loan’s Maturity Date and the property is at least 85% occupied, the TI/LC Reserve account shall be subject to a cap of $79,578. |
(39) | The Cut-off Date LTV Ratio is calculated using the appraisal’s “as-is” Appraised Value of $5,200,000 plus the amount of PIP required under the franchise agreement ($91,384). The Cut-off Date LTV Ratio calculated using solely the “as-is” Appraised Value is 65.3%. |
A-41 |
(40) | The unit mix includes 9 office suites totaling 5,650 SF which contribute approximately 13.5% of the underwritten base rent. |
(41) | The $115,230 cap on the TI/LC Reserve account excludes the initial $150,000 deposit into the TI/LC Reserve account. |
(42) | The unit mix includes 2 office suites totaling 2,000 SF which contribute approximately 6.0% of the underwritten base rent. |
A-42 |
ANNEX B
STRUCTURAL AND COLLATERAL TERM SHEET
(THIS PAGE INTENTIONALLY LEFT BLANK)
June 24, 2015
Structural and Collateral Term Sheet
$723,323,870
(Approximate Mortgage Pool Balance)
$666,096,000
(Offered Certificates)
Citigroup Commercial Mortgage Trust 2015-GC31
As Issuing Entity
Citigroup Commercial Mortgage Securities Inc.
As Depositor
Commercial Mortgage Pass-Through Certificates
Series 2015-GC31
Citigroup Global Markets Realty Corp.
Goldman Sachs Mortgage Company
Rialto Mortgage Finance, LLC
RAIT Funding, LLC
KGS-Alpha Real Estate Capital Markets, LLC
As Sponsors
Citigroup | Goldman, Sachs & Co. |
Co-Lead Managers and Joint Bookrunners | |
Drexel Hamilton | |
Co-Manager |
B-1 |
CERTIFICATE SUMMARY | ||||||||||||||||
OFFERED CERTIFICATES | ||||||
Offered Class | Initial Certificate | Approximate | Initial Pass- | Pass-Through | Expected |
Expected Principal | ||||||
Class A-1 | $28,330,000 | 30.000%(4) | 1.637% | Fixed | 2.86 | 8/15 – 7/20 | ||||||
Class A-2 | $2,298,000 | 30.000%(4) | 3.084% | Fixed | 6.84 | 5/22 – 5/22 | ||||||
Class A-3 | $160,000,000 | 30.000%(4) | 3.497% | Fixed | 9.78 | 2/25 – 5/25 | ||||||
Class A-4 | $268,724,000 | 30.000%(4) | 3.762% | Fixed | 9.86 | 5/25 – 6/25 | ||||||
Class A-AB | $46,974,000 | 30.000%(4) | 3.431% | Fixed | 7.35 | 7/20 – 2/25 | ||||||
Class X-A | $565,089,000(5) | N/A | 0.604% | Variable IO(6) | N/A | N/A | ||||||
Class A-S(7) | $58,763,000(8) | 21.876% | 4.199% | WAC - 0.001%(9) | 9.92 | 6/25 – 6/25 | ||||||
Class B(7) | $42,871,000(8) | 15.949% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||
Class PEZ(7) | $135,486,000(8) | 11.269%(11) | (12) | (12) | 9.92 | 6/25 – 6/25 | ||||||
Class C(7) | $33,852,000(8) | 11.269%(11) | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||
Class D | $24,284,000 | 7.912% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||
NON-OFFERED CERTIFICATES | ||||||||||||
Non-Offered | Initial Certificate Principal Amount or Notional Amount(1) | Approximate | Initial Pass- | Pass-Through | Expected | Expected Principal Window(3) | ||||||
Class E | $11,000,000 | 6.391% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||
Class F | $14,864,000 | 4.336% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||
Class G | $12,231,000 | 2.645% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||
Class H | $19,132,869 | 0.000% | 4.200% | WAC(10) | 9.92 | 6/25 – 6/25 | ||||||
Class S(13) | N/A | N/A | N/A | N/A | N/A | N/A | ||||||
Class R(14) | N/A | N/A | N/A | N/A | N/A | N/A |
The securities offered by this structural and collateral term sheet (this “Term Sheet”) are described in greater detail in the prospectus, dated January 16, 2015, included as part of our registration statement (SEC File No. 333-189017) (the “Base Prospectus”) and a separate prospectus supplement dated June 24, 2015 (the “Prospectus Supplement”). Capitalized terms used but not otherwise defined in this Term Sheet have the respective meanings assigned to those terms elsewhere in the Prospectus Supplement or, if not defined in the Prospectus Supplement, then in the Base Prospectus.
(1) | Approximate, subject to a variance of plus or minus 5%. |
(2) | Approximateper annum rate as of the Closing Date. |
(3) | Determined assuming no prepayments prior to the maturity date or any anticipated repayment date, as applicable, for each mortgage loan and based on the Modeling Assumptions set forth under “Yield, Prepayment and Maturity Considerations” in the Prospectus Supplement. |
(4) | The credit support percentages set forth for the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates are represented in the aggregate. |
(5) | The Class X-A certificates will not have certificate principal amounts and will not be entitled to receive distributions of principal. Interest will accrue on the Class X-A certificates at the applicable pass-through rate based upon the related notional amount. The notional amount of the Class X-A certificates will be equal to the aggregate of the certificate principal amounts of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S trust component from time to time. |
(6) | The pass-through rate on the Class X-A certificates will generally be a per annum rate equal to the excess, if any, of (i) the weighted average of the net interest rates on the mortgage loans (in each case adjusted, if necessary, to accrue on the basis of a 360-day year consisting of twelve 30-day months), over (ii) the weighted average of the pass-through rates of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S trust component, as described in the Prospectus Supplement. |
(7) | The Class A-S, Class B and Class C certificates, in the applicable proportions, may be exchanged for Class PEZ certificates, and Class PEZ certificates may be exchanged for the applicable proportions of Class A-S, Class B and Class C certificates. The Class A-S, Class B, Class PEZ and Class C certificates are collectively referred to as the “Exchangeable Certificates.” |
(8) | On the Closing Date, the issuing entity will issue the Class A-S, Class B and Class C trust components, which will have initial outstanding principal balances, subject to a variance ofplus orminus 5%, of $58,763,000, $42,871,000 and $33,852,000, respectively. The Exchangeable Certificates will, at all times, represent undivided beneficial ownership interests in a grantor trust that will hold such trust components. Each class of the Exchangeable Certificates will, at all times, represent a beneficial interest in a percentage of the outstanding principal balance of the Class A-S, Class B and/or Class C trust components. Following any exchange of Class A-S, Class B and Class C certificates for Class PEZ certificates or any exchange of Class PEZ certificates for Class A-S, Class B and Class C certificates, the percentage interest of the outstanding principal balances of the Class A-S, Class B and Class C trust components that is represented by the Class A-S, Class B, Class PEZ and Class C certificates will be increased or decreased accordingly. The initial certificate principal amount of each class of the Class A-S, Class B and Class C certificates shown in the table above represents the maximum certificate principal amount of such class without giving effect to any issuance of Class PEZ certificates. The initial certificate principal amount of the Class PEZ certificates shown in the table above is equal to the aggregate of the maximum initial certificate principal amounts of the Class A-S, Class B and Class C certificates, representing the maximum certificate principal amount of the Class PEZ certificates that could be issued in an exchange. The actual certificate principal amount of any class of the Exchangeable Certificates issued on the Closing Date may be less than the maximum certificate principal amount of that class and may be zero. The certificate principal amounts of the Class A-S, Class B and Class C certificates to be issued on the Closing Date will be reduced, in required proportions, by an amount equal to the certificate principal amount of the Class PEZ certificates issued on the Closing Date. The aggregate certificate principal amount of the offered certificates shown on the cover page of this Term Sheet includes the maximum certificate principal amount of the Exchangeable Certificates that could be outstanding on the Closing Date, equal to $135,486,000 (subject to a variance ofplus orminus 5%). |
(9) | For any distribution date, the pass-through rate on the Class A-S certificates will be a per annum rate equal to the weighted average of the net interest rates on the mortgage loans (in each case, adjusted, if necessary, to accrue on the basis of a 360-day year consisting of twelve 30-day months) as of their respective due dates in the month preceding the month in which the related distribution date occurs, less 0.001%. |
B-2 |
CERTIFICATE SUMMARY (continued) |
(10) | For any distribution date, the pass-through rate on each class of the Class B, Class C, Class D, Class E, Class F, Class G and Class H certificates will be a per annum rate equal to the weighted average of the net interest rates on the mortgage loans (in each case, adjusted, if necessary, to accrue on the basis of a 360-day year consisting of twelve 30-day months) as of their respective due dates in the month preceding the month in which the related distribution date occurs. |
(11) | The initial subordination levels for the Class C and Class PEZ certificates are equal to the subordination level of the underlying Class C trust component. |
(12) | The Class PEZ certificates will not have a pass-through rate, but will be entitled to receive the sum of the interest distributable on the percentage interests of the Class A-S, Class B and Class C trust components represented by the Class PEZ certificates. The pass-through rates on the Class A-S, Class B and Class C trust components will at all times be the same as the pass-through rates on the Class A-S, Class B and Class C certificates, respectively. |
(13) | The Class S certificates will not have a certificate principal amount, notional amount, pass-through rate, rating or rated final distribution date. The Class S certificates will only be entitled to distributions of excess interest accrued on the mortgage loans with an anticipated repayment date. See “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—ARD Loans” in the Prospectus Supplement. |
(14) | The Class R certificates will not have a certificate principal amount, notional amount, pass-through rate, rating or rated final distribution date. The Class R certificates will represent the residual interests in each of two separate REMICs, as further described in the Prospectus Supplement. The Class R certificates will not be entitled to distributions of principal or interest. |
B-3 |
MORTGAGE POOL CHARACTERISTICS |
Mortgage Pool Characteristics(1) | |
Initial Pool Balance(2) | $723,323,870 |
Number of Mortgage Loans | 50 |
Number of Mortgaged Properties | 76 |
Average Cut-off Date Mortgage Loan Balance | $14,466,477 |
Weighted Average Mortgage Interest Rate | 4.0831% |
Weighted Average Remaining Term to Maturity/ARD (months)(3) | 118 |
Weighted Average Remaining Amortization Term (months)(4) | 357 |
Weighted Average Cut-off Date LTV Ratio(5) | 60.7% |
Weighted Average Maturity Date/ARD LTV Ratio(3)(6) | 52.7% |
Weighted Average Underwritten Debt Service Coverage Ratio(7) | 2.29x |
Weighted Average Debt Yield on Underwritten NOI(8) | 11.7% |
% of Mortgage Loans with Mezzanine Debt | 4.1% |
% of Mortgage Loans with Preferred Equity(9) | 1.2% |
% of Mortgaged Properties with Single Tenants | 4.6% |
(1) | The Selig Office Portfolio, Dallas Market Center and Crowne Plaza Bloomington mortgage loans have one or more relatedpari passu companion loans, and the loan-to-value ratio, debt service coverage ratio, debt yield and balance per SF/room calculations presented in this Term Sheet include the relatedpari passu companion loans unless otherwise indicated. Other than as specifically noted, the loan-to-value ratio, debt service coverage ratio, debt yield and mortgage loan rate information for each mortgage loan is presented in this Term Sheet without regard to any other indebtedness (whether or not secured by the related mortgaged property, ownership interests in the related borrower or otherwise) that currently exists or that may be incurred by the related borrower or its owners in the future, in order to present statistics for the related mortgage loan without combination with the other indebtedness. |
(2) | Subject to a permitted variance of plus or minus 5%. |
(3) | Unless otherwise indicated, mortgage loans with anticipated repayment dates are presented as if they were to mature on the anticipated repayment date. |
(4) | Excludes mortgage loans that are interest only for the entire term. |
(5) | Unless otherwise indicated, the Cut-off Date LTV Ratio is calculated utilizing the “as-is” appraised value. With respect to 3 mortgage loans, representing approximately 3.0% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, the respective Cut-off Date LTV Ratio was calculated using either (i) an “as-is” appraised value plus related property improvement plan costs which were reserved for at origination, or (ii) the cut-off date principal balance of a mortgage loan less a reserve taken at origination. The weighted average Cut-off Date LTV Ratio for the mortgage pool without making any of the adjustments described above is 61.2%. See “Description of the Mortgage Pool—Certain Calculations and Definitions” in the Prospectus Supplement for a description of the Cut-off Date LTV Ratio. |
(6) | Unless otherwise indicated, the Maturity Date/ARD LTV Ratio is calculated utilizing the “as-is” appraised value. With respect to 14 mortgage loans, representing approximately 31.5% of the initial pool balance, the respective Maturity Date/ARD LTV Ratios were each calculated using the related “as stabilized” or “prospective value upon stabilization” appraised value. See “Description of the Mortgage Pool—Certain Calculations and Definitions” in the Prospectus Supplement for a description of Maturity Date/ARD LTV Ratio. |
(7) | Unless otherwise indicated, the Underwritten Debt Service Coverage Ratio for each mortgage loan is calculated by dividing the Underwritten Net Cash Flow from the related mortgaged property or mortgaged properties by the annual debt service for such mortgage loan, as adjusted in the case of mortgage loans with a partial interest only period by using the first 12 amortizing payments due instead of the actual interest only payment. With respect to the St. Anthony’s Healthplex North mortgage loan, representing approximately 4.1% of the initial pool balance, which amortizes based on the non-standard amortization schedule set forth on Annex G to the Prospectus Supplement, the Underwritten Debt Service Coverage Ratio of such mortgage loan is calculated based on the aggregate debt service during the 12-month period commencing August 1, 2015. See “Description of the Mortgage Pool—Certain Calculations and Definitions” in the Prospectus Supplement for a description of Underwritten Debt Service Coverage Ratio. |
(8) | Unless otherwise indicated, the Debt Yield on Underwritten NOI for each mortgage loan is the related mortgaged property’s Underwritten NOI divided by the Cut-off Date Balance of such mortgage loan, and the Debt Yield on Underwritten NCF for each mortgage loan is the related mortgaged property’s Underwritten NCF divided by the Cut-off Date Balance of such mortgage loan. |
(9) | See“Description of the Mortgage Pool—Statistical Characteristics of the Mortgage Loans—Additional Indebtedness” in the Prospectus Supplement. |
B-4 |
KEY FEATURES OF THE CERTIFICATES |
Co-Lead Managers and | Citigroup Global Markets Inc. | |
Joint Bookrunners: | Goldman, Sachs & Co. | |
Co-Manager: | Drexel Hamilton, LLC | |
Depositor: | Citigroup Commercial Mortgage Securities Inc. | |
Initial Pool Balance: | $723,323,870 | |
Master Servicer: | Wells Fargo Bank, National Association | |
Special Servicer: | Torchlight Loan Services, LLC | |
Certificate Administrator: | Citibank, N.A. | |
Trustee: | Deutsche Bank Trust Company Americas | |
Operating Advisor: | Pentalpha Surveillance LLC | |
Pricing: | Week of June 22, 2015 | |
Closing Date: | July 8, 2015 | |
Cut-off Date: | For each mortgage loan, the related due date for such mortgage loan in July 2015 | |
Determination Date: | The 6th day of each month or, if such 6th day is not a business day, the next business day, commencing in August 2015 | |
Distribution Date: | The 4th business day after the Determination Date, commencing in August 2015 | |
Interest Accrual: | The preceding calendar month | |
ERISA Eligible: | The offered certificates are expected to be ERISA eligible, subject to the exemption conditions described in the Prospectus Supplement | |
SMMEA Eligible: | No | |
Payment Structure: | Sequential Pay | |
Day Count: | 30/360 | |
Tax Structure: | REMIC | |
Rated Final Distribution Date: | June 2048 | |
Cleanup Call: | 1.0% | |
Minimum Denominations: | $10,000 minimum for the offered certificates (except with respect to Class X-A: $1,000,000 minimum); $1 thereafter for all the offered certificates | |
Delivery: | Book-entry through DTC | |
Bond Information: | Cash flows are expected to be modeled by TREPP, INTEX and BLOOMBERG |
B-5 |
TRANSACTION HIGHLIGHTS |
n | $723,323,869 (Approximate) New-Issue Multi-Borrower CMBS: | ||
— | Overview: The mortgage pool consists of 50 fixed-rate commercial mortgage loans that have an aggregate Cut-off Date Balance of $723,323,870 (the “Initial Pool Balance”), have an average mortgage loan Cut-off Date Balance of $14,466,477 and are secured by 76 mortgaged properties located throughout 26 states | ||
— | LTV: 60.7% weighted average Cut-off Date LTV Ratio | ||
— | DSCR: 2.29x weighted average Underwritten Debt Service Coverage Ratio | ||
— | Debt Yield: 11.7% weighted average Debt Yield on Underwritten NOI | ||
— | Credit Support: 30.000% credit support to Class A-1 / A-2 / A-3 / A-4 / A-AB | ||
n | Loan Structural Features: | ||
— | Amortization: 71.2% of the mortgage loans by Initial Pool Balance have scheduled amortization: | ||
– | 30.5% of the mortgage loans by Initial Pool Balance have amortization for the entire term with a balloon payment due at maturity or anticipated repayment date | ||
– | 40.7% of the mortgage loans by Initial Pool Balance have scheduled amortization following a partial interest only period with a balloon payment due at maturity or anticipated repayment date | ||
— | Hard Lockboxes: 43.0% of the mortgage loans by Initial Pool Balance have a Hard Lockbox in place | ||
— | Cash Traps: 98.8% of the mortgage loans by Initial Pool Balance have cash traps triggered by certain declines in cash flow, all at levels equal to or greater than a 1.00x coverage, that fund an excess cash flow reserve | ||
— | Reserves: The mortgage loans require amounts to be escrowed for reserves as follows: | ||
- | Real Estate Taxes: 44 mortgage loans representing 93.5% of the Initial Pool Balance | ||
- | Insurance: 37 mortgage loans representing 59.9% of the Initial Pool Balance | ||
- | Replacement Reserves (Including FF&E Reserves): 41 mortgage loans representing 89.9% of the Initial Pool Balance | ||
- | Tenant Improvements / Leasing Commissions: 21 mortgage loans representing 85.0% of the portion of the Initial Pool Balance that is secured by office, mixed use, retail and industrial properties and one self storage property with office tenants | ||
— | Predominantly Defeasance: 86.3% of the mortgage loans by Initial Pool Balance permit defeasance after an initial lockout period | ||
n | Multiple-Asset Types > 5.0% of the Initial Pool Balance: | ||
— | Office: 38.6% of the mortgaged properties by allocated Initial Pool Balance are office properties | ||
— | Mixed Use: 19.3% of the mortgaged properties by allocated Initial Pool Balance are mixed use properties | ||
— | Retail: 16.7% of the mortgaged properties by allocated Initial Pool Balance are retail properties (14.0% are anchored or shadow anchored retail properties) | ||
— | Multifamily: 12.5% of the mortgaged properties by allocated Initial Pool Balance are multifamily properties | ||
— | Self Storage: 7.7% of the mortgaged properties by allocated Initial Pool Balance are self storage properties | ||
n | Geographic Diversity: The 76 mortgaged properties are located throughout 26 states with only three states having greater than 10.0% of the allocated Initial Pool Balance: Texas (16.1%), California (14.1%) and Illinois (13.8%) |
B-6 |
COLLATERAL OVERVIEW |
Mortgage Loans by Loan Seller | ||||||||||||
Mortgage Loan Seller | Mortgage Loans | Mortgaged Properties | Aggregate Cut-off Date Balance | % of Initial Pool Balance | ||||||||
Citigroup Global Markets Realty Corp. | 22 | 28 | $299,501,709 | 41.4 | % | |||||||
Goldman Sachs Mortgage Company | 10 | 22 | 256,164,551 | 35.4 | ||||||||
Rialto Mortgage Finance, LLC | 9 | 16 | 90,851,031 | 12.6 | ||||||||
RAIT Funding, LLC | 6 | 6 | 55,563,296 | 7.7 | ||||||||
KGS-Alpha Real Estate Capital Markets, LLC | 3 | 4 | 21,243,283 | 2.9 | ||||||||
Total | 50 | 76 | $723,323,870 | 100.0 | % |
Ten Largest Mortgage Loans | |||||||||||||||||||
Mortgage Loan Name | Cut-off Date Balance | % of Initial Pool Balance | Property Type | Property Size SF / Units | Cut-off Date Balance Per SF / Unit | UW NCF DSCR | UW NOI Debt Yield | Cut-off Date LTV Ratio | |||||||||||
135 South LaSalle | $100,000,000 | 13.8 | % | Office | 1,310,047 | $76 | 5.42x | 19.5% | 30.3% | ||||||||||
Selig Office Portfolio | 72,000,000 | 9.95 | Office | 1,631,457 | $211 | 2.22x | 9.3% | 63.4% | |||||||||||
Dallas Market Center | 71,803,978 | 9.9 | Mixed Use | 3,101,772 | $83 | 2.13x | 13.1% | 64.1% | |||||||||||
Pasadena Office Tower | 42,000,000 | 5.8 | Office | 141,969 | $296 | 1.62x | 9.9% | 73.9% | |||||||||||
St. Anthony’s Healthplex North | 29,929,067 | 4.1 | Office | 96,847 | $309 | 1.64x | 9.2% | 69.6% | |||||||||||
Rockside Road Office Portfolio | 29,500,000 | 4.1 | Office / Mixed Use | 389,949 | $76 | 1.67x | 10.7% | 69.5% | |||||||||||
Chalet Garden Apartments | 27,500,000 | 3.8 | Multifamily | 484 | $56,818 | 1.37x | 8.7% | 67.4% | |||||||||||
Orinda Square | 22,700,000 | 3.1 | Mixed Use | 90,537 | $251 | 1.46x | 9.1% | 71.4% | |||||||||||
Park at Sugar Creek | 22,700,000 | 3.1 | Mixed Use | 140,254 | $162 | 1.63x | 10.0% | 75.9% | |||||||||||
Mesa Town Center | 22,200,000 | 3.1 | Retail | 140,676 | $158 | 2.79x | 11.7% | 46.3% | |||||||||||
Top 10 Total / Wtd. Avg. | $440,333,045 | 60.9 | % | 2.70x | 12.5% | 58.3% | |||||||||||||
Remaining Total / Wtd. Avg. | 282,990,825 | 39.1 | 1.64x | 10.5% | 64.6% | ||||||||||||||
Total / Wtd. Avg. | $723,323,870 | 100.0 | % | 2.29x | 11.7% | 60.7% |
Pari Passu Companion Loan Summary | |||||||||||||||||||
Mortgage Loan Name | Mortgage Loan Cut-off Date Balance | % of Initial Pool Balance | Number of Companion Loans | Pari Passu Companion Loan Cut-off Date Balance | Loan Combination Cut-off Date Balance | Controlling Pooling & Servicing Agreement (“Controlling PSA”)(1) | Master Servicer | Special Servicer | |||||||||||
Selig Office Portfolio(2) | $72,000,000 | 9.95% | 3 | $273,000,000 | $345,000,000 | CGCMT 2015-GC29 | Midland | Midland | |||||||||||
Dallas Market Center(3) | $71,803,978 | 9.9% | 2 | $186,490,887 | $258,294,865 | GSMS 2015-GC30 | Midland | Midland | |||||||||||
Crowne Plaza Bloomington | $12,170,872 | 1.7% | 1 | $13,909,568 | $26,080,440 | CGCMT 2015-GC29 | Midland | Midland |
(1) | Each loan combination will be serviced under the related Controlling PSA, and the controlling class representative under the related Controlling PSA (or such other party as is designated under the related Controlling PSA) will be entitled to exercise the rights of controlling note holder for the subject loan combination. | ||
(2) | The Selig Office Portfolio Companion Loans are currently comprised of the controlling note A-1, with an outstanding principal balance as of the Cut-off Date of $125,000,000, the non-controlling note A-2, with an outstanding principal balance as of the Cut-off Date of $123,000,000, and the non-controlling note A-4, with an outstanding principal balance as of the Cut-off Date of $25,000,000. | ||
(3) | The Dallas Market Center Companion Loans are currently comprised of the controlling note A-1, with an outstanding principal balance as of the Cut-off Date of $129,646,071, and the non-controlling note A-3, with an outstanding principal balance as of the Cut-off Date of $56,844,816. |
B-7 |
COLLATERAL OVERVIEW (continued) |
Mortgage Loans with Existing Mezzanine Debt | ||||||||||||||||
Mortgage Loan Name | Mortgage Loan Cut-off Date Balance | Mezzanine Debt Cut-off Date Balance | Cut-off Date Total Debt Balance | Wtd. Avg. Cut-off Date Total Debt Interest Rate | Cut-off Date Mortgage Loan LTV | Cut-off Date Total Debt LTV | Cut-off Date Mortgage Loan UW NCF DSCR | Cut-off Date Total Debt UW NCF DSCR | ||||||||
St. Anthony’s Healthplex North(1)(2) | $29,929,067 | $4,988,178 | $34,917,245 | 4.8000% | 69.6% | 81.2% | 1.64x | 1.21x |
(1) | The related mezzanine loan is initially being held by RAIT Partnership, L.P. | ||
(2) | The St. Anthony’s Healthplex North Cut-off Date Mortgage Loan UW NCF DSCR and Cut-off Date Total Debt UW NCF DSCR are calculated using the mortgage loan’s non-standard amortization schedule (as set forth in Annex G to the Prospectus Supplement) and the related mezzanine loan’s non-standard amortization schedule, as applicable, and are calculated based on the aggregate debt service for the 12-month period commencing August 1, 2015. |
B-8 |
COLLATERAL OVERVIEW (continued) |
Previously Securitized Mortgaged Properties(1) | ||||||||||||||||
Property Name | Mortgage Loan Seller | City | State | Property Type | Cut-off Date Balance / Allocated Cut-off Date Balance(2) | % of Initial Pool Balance | Previous Securitization | |||||||||
1000 Second Avenue | GSMC | Seattle | WA | Office | $25,388,430 | 3.5% | JPMCC 2005-LDP5 | |||||||||
2901 Third Avenue | GSMC | Seattle | WA | Office | $10,842,975 | 1.5% | JPMCC 2005-LDP5 | |||||||||
3101 Western Avenue | GSMC | Seattle | WA | Office | $9,123,967 | 1.3% | JPMCC 2005-LDP5 | |||||||||
300 Elliott Avenue West | GSMC | Seattle | WA | Office | $8,000,000 | 1.1% | JPMCC 2005-LDP5 | |||||||||
3131 Elliott Avenue | GSMC | Seattle | WA | Office | $7,867,769 | 1.1% | JPMCC 2005-LDP5 | |||||||||
2615 Fourth Avenue | GSMC | Seattle | WA | Office | $4,733,884 | 0.7% | JPMCC 2005-LDP5 | |||||||||
190 Queen Anne Avenue North | GSMC | Seattle | WA | Office | $2,790,083 | 0.4% | JPMCC 2005-LDP5 | |||||||||
Pasadena Office Tower | CGMRC | Pasadena | CA | Office | $42,000,000 | 5.8% | MLCFC 2006-2 | |||||||||
Mesa Town Center | GSMC | San Diego | CA | Retail | $22,200,000 | 3.1% | CSFB 2005-C3 | |||||||||
Hagerstown Plaza | GSMC | Hagerstown | MD | Retail | $14,160,573 | 2.0% | BSCMS 2005-PWR8 | |||||||||
Best Storage-Tudor Road | CGMRC | Anchorage | AK | Self Storage | $9,830,595 | 1.4% | BSCMS 2005-PW10 | |||||||||
Crowne Plaza Bloomington | CGMRC | Bloomington | MN | Hospitality | $12,170,872 | 1.7% | BSCMS 2007-PW17 | |||||||||
Oakmont Apartments | GSMC | Tigard | OR | Multifamily | $10,700,000 | 1.5% | COMM 2006-C7 | |||||||||
Gables CitiTower | CGMRC | Coral Gables | FL | Office | $8,986,917 | 1.2% | WBCMT 2003-C4 | |||||||||
Deer Park Gardens | RMF | Deer Park | TX | Multifamily | $6,400,000 | 0.9% | CSMC 2006-C1 | |||||||||
Infinity Corporate Center | KGS | Garfield Heights | OH | Office | $6,150,000 | 0.9% | JPMCC 2007-CB20 | |||||||||
Diamonette Building | RAIT Funding, LLC | Doral | FL | Industrial | $6,000,000 | 0.8% | LBUBS 2005-C3 | |||||||||
Truckee River Terraces | GSMC | Reno | NV | Multifamily | $5,900,000 | 0.8% | FNA 2013-M5 | |||||||||
College Village Shopping Center | RMF | Overland Park | KS | Retail | $5,835,000 | 0.8% | MLMT 2005-CIP1 | |||||||||
1081 and 1083 Harkins Road | GSMC | Salinas | CA | Industrial | $1,338,639 | 0.2% | BSCMS 2005-T20 | |||||||||
11145 and 11165 Commercial Parkway | GSMC | Castroville | CA | Industrial | $1,288,190 | 0.2% | BSCMS 2005-T20 | |||||||||
11285 Commercial Parkway | GSMC | Castroville | CA | Industrial | $896,576 | 0.1% | BSCMS 2005-T20 | |||||||||
11085 Commercial Parkway | GSMC | Castroville | CA | Industrial | $827,518 | 0.1% | BSCMS 2005-T20 | |||||||||
11325 Commercial Parkway | GSMC | Castroville | CA | Industrial | $649,077 | 0.1% | BSCMS 2005-T20 | |||||||||
Avondale Apartments | KGS | Avondale | PA | Multifamily | $3,519,251 | 0.5% | MLMI 1998-C2 | |||||||||
Granite Court | KGS | West Chester | PA | Multifamily | $1,474,032 | 0.2% | DLJCM 2000-CF1; SPARC 2001-CF1 | |||||||||
Walgreens Winston-Salem | CGMRC | Winston-Salem | NC | Retail | $4,518,384 | 0.6% | JPMCC 2005-LDP3 | |||||||||
Metro Storage | CGMRC | Taylor | MI | Self Storage | $2,608,650 | 0.4% | WBCMT 2005-C18 | |||||||||
Cedar - Dover Plaza | CGMRC | Dover | OH | Retail | $2,474,015 | 0.3% | CSFB 2005-C4 |
(1) | The table above includes mortgaged properties securing mortgage loans for which the most recent prior financing of all or a significant portion of such mortgaged property was included in a securitization. Information under “Previous Securitization” represents the most recent such securitization with respect to each of those mortgaged properties. The information in the above table is based solely on information provided by the related borrower or obtained through searches of a third-party database, and has not otherwise been confirmed by the mortgage loan sellers. | ||
(2) | Reflects the allocated loan amount in cases where the applicable mortgaged property is one of a portfolio of mortgaged properties securing a particular mortgage loan. |
B-9 |
COLLATERAL OVERVIEW (continued) |
Property Types | |||||||||||||||
Property Type / Detail | Number of Mortgaged Properties | Aggregate Cut-off Date Balance(1) | % of Initial Pool Balance(1) | Wtd. Avg. Underwritten NCF DSCR(2) | Wtd. Avg. Cut- off Date LTV Ratio(2) | Wtd. Avg. Debt Yield on Underwritten NOI(2) | |||||||||
Office | 18 | $278,990,650 | 38.6 | % | 3.18x | 53.4% | 13.6% | ||||||||
CBD | 12 | 222,986,917 | 30.8 | 3.56x | 49.3% | 14.3% | |||||||||
Medical | 1 | 29,929,067 | 4.1 | 1.64x | 69.6% | 9.2% | |||||||||
General Suburban | 5 | 26,074,666 | 3.6 | 1.71x | 70.0% | 12.5% | |||||||||
Mixed Use | 6 | $139,586,628 | 19.3 | % | 1.87x | 67.8% | 11.6% | ||||||||
Merchandise Mart/Retail | 1 | 71,803,978 | 9.9 | 2.13x | 64.1% | 13.1% | |||||||||
Retail/Office | 2 | 45,400,000 | 6.3 | 1.55x | 73.7% | 9.6% | |||||||||
Office/Flex | 2 | 18,487,638 | 2.6 | 1.67x | 69.5% | 10.7% | |||||||||
Retail/Office/Flex | 1 | 3,895,012 | 0.5 | 1.88x | 59.5% | 13.3% | |||||||||
Retail | 16 | $120,923,697 | 16.7 | % | 1.71x | 63.5% | 9.7% | ||||||||
Anchored | 7 | 75,618,397 | 10.5 | 1.88x | 60.2% | 10.4% | |||||||||
Single Tenant Retail | 7 | 32,845,299 | 4.5 | 1.37x | 69.7% | 8.0% | |||||||||
Shadow Anchored | 1 | 6,625,000 | 0.9 | 1.56x | 62.2% | 9.7% | |||||||||
Unanchored | 1 | 5,835,000 | 0.8 | 1.65x | 72.8% | 11.1% | |||||||||
Multifamily | 12 | $90,362,331 | 12.5 | % | 1.41x | 67.1% | 9.0% | ||||||||
Garden | 10 | 77,762,331 | 10.8 | 1.41x | 66.4% | 9.1% | |||||||||
Student Housing | 2 | 12,600,000 | 1.7 | 1.41x | 71.6% | 8.7% | |||||||||
Self Storage | 15 | $55,696,014 | 7.7 | % | 1.86x | 59.6% | 10.3% | ||||||||
Hospitality | 3 | $26,764,550 | 3.7 | % | 1.77x | 69.7% | 13.1% | ||||||||
Full Service | 2 | 23,370,872 | 3.2 | 1.71x | 70.5% | 12.7% | |||||||||
Limited Service | 1 | 3,393,678 | 0.5 | 2.17x | 64.1% | 15.8% | |||||||||
Industrial | 6 | $11,000,000 | 1.5 | % | 2.05x | 56.4% | 12.6% | ||||||||
Flex | 1 | 6,000,000 | 0.8 | 1.52x | 63.8% | 9.7% | |||||||||
Warehouse/Distribution | 5 | 5,000,000 | 0.7 | 2.68x | 47.6% | 16.1% | |||||||||
Total / Wtd. Avg. | 76 | $723,323,870 | 100.0 | % | 2.29x | 60.7% | 11.7% |
(1) | Calculated based on the mortgaged property’s allocated loan amount for mortgage loans secured by more than one mortgaged property. | ||
(2) | Weighted average based on the mortgaged property’s allocated loan amount for mortgage loans secured by more than one mortgaged property. |
B-10 |
COLLATERAL OVERVIEW (continued) |
Geographic Distribution | ||||||||||||||||||||
Property Location | Number of Mortgaged Properties | Aggregate Cut-off Date Balance(1) | % of Initial Pool Balance | Aggregate Appraised Value(2)(3) | % of Total Appraised Value | Underwritten NOI(2) | % of Total Underwritten NOI | |||||||||||||
Texas | 6 | $116,123,990 | 16.1 | % | $465,650,000 | 22.9 | % | $38,384,330 | 28.1 | % | ||||||||||
California | 9 | 102,000,000 | 14.1 | 161,660,000 | 8.0 | 10,567,904 | 7.7 | |||||||||||||
Illinois | 1 | 100,000,000 | 13.8 | 330,000,000 | 16.2 | 19,529,300 | 14.3 | |||||||||||||
Washington | 9 | 72,000,000 | 9.95 | 544,500,000 | 26.8 | 32,076,365 | 23.5 | |||||||||||||
Oklahoma | 4 | 51,322,427 | 7.1 | 72,700,000 | 3.6 | 4,347,255 | 3.2 | |||||||||||||
Florida | 6 | 41,969,352 | 5.8 | 77,600,000 | 3.8 | 4,941,683 | 3.6 | |||||||||||||
Ohio | 6 | 38,124,015 | 5.3 | 52,775,000 | 2.6 | 4,226,441 | 3.1 | |||||||||||||
New Jersey | 4 | 35,375,000 | 4.9 | 53,260,000 | 2.6 | 3,238,084 | 2.4 | |||||||||||||
New York | 8 | 22,242,809 | 3.1 | 31,880,000 | 1.6 | 1,974,639 | 1.4 | |||||||||||||
Michigan | 4 | 19,395,955 | 2.7 | 27,940,000 | 1.4 | 2,322,895 | 1.7 | |||||||||||||
Maryland | 1 | 14,160,573 | 2.0 | 19,700,000 | 1.0 | 1,232,538 | 0.9 | |||||||||||||
Alaska | 2 | 12,464,974 | 1.7 | 22,570,000 | 1.1 | 1,369,247 | 1.0 | |||||||||||||
Pennsylvania | 3 | 12,183,452 | 1.7 | 19,175,000 | 0.9 | 1,181,984 | 0.9 | |||||||||||||
Minnesota | 1 | 12,170,872 | 1.7 | 31,900,000 | 1.6 | 3,400,765 | 2.5 | |||||||||||||
Nebraska | 1 | 11,200,000 | 1.5 | 16,600,000 | 0.8 | 1,392,792 | 1.0 | |||||||||||||
Oregon | 1 | 10,700,000 | 1.5 | 17,900,000 | 0.9 | 884,765 | 0.6 | |||||||||||||
Hawaii | 1 | 9,000,000 | 1.2 | 21,380,000 | 1.1 | 1,124,788 | 0.8 | |||||||||||||
Louisiana | 1 | 9,000,000 | 1.2 | 12,400,000 | 0.6 | 746,416 | 0.5 | |||||||||||||
Nevada | 1 | 5,900,000 | 0.8 | 10,000,000 | 0.5 | 559,120 | 0.4 | |||||||||||||
Kansas | 1 | 5,835,000 | 0.8 | 8,010,000 | 0.4 | 649,241 | 0.5 | |||||||||||||
Rhode Island | 1 | 5,155,000 | 0.7 | 7,900,000 | 0.4 | 401,800 | 0.3 | |||||||||||||
North Carolina | 1 | 4,518,384 | 0.6 | 6,600,000 | 0.3 | 364,760 | 0.3 | |||||||||||||
Iowa | 1 | 3,600,000 | 0.5 | 5,200,000 | 0.3 | 349,987 | 0.3 | |||||||||||||
South Carolina | 1 | 3,394,048 | 0.5 | 5,450,000 | 0.3 | 384,606 | 0.3 | |||||||||||||
Colorado | 1 | 3,393,678 | 0.5 | 5,200,000 | 0.3 | 537,485 | 0.4 | |||||||||||||
Connecticut | 1 | 2,094,341 | 0.3 | 3,700,000 | 0.2 | 227,280 | 0.2 | |||||||||||||
Total | 76 | $723,323,870 | 100.0 | % | $2,031,650,000 | 100.0 | % | $136,416,470 | 100.0 | % |
(1) | Calculated based on the mortgaged property’s allocated loan amount for mortgage loans secured by more than one mortgaged property. | ||
(2) | Aggregate Appraised Values and Underwritten NOI reflect the aggregate values without any reduction for the pari passu companion loan(s). | ||
(3) | The Aggregate Appraised Value was calculated using the individual “as-is” appraised values for the Rockside Road Office Portfolio mortgaged properties and NY Seven Self Storage Portfolio mortgaged properties without regard to the portfolio premiums as described under“Certain Definitions—Appraised Value”in this Term Sheet. |
B-11 |
Distribution of Cut-off Date Balances | ||||||||||
Range of Cut-off Date Balances ($) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
2,350,000 - 4,999,999 | 15 | $55,774,266 | 7.7 | % | ||||||
5,000,000 - 9,999,999 | 16 | 106,179,390 | 14.7 | |||||||
10,000,000 - 14,999,999 | 7 | 85,396,418 | 11.8 | |||||||
15,000,000 - 19,999,999 | 1 | 15,093,360 | 2.1 | |||||||
20,000,000 - 29,999,999 | 7 | 175,076,457 | 24.2 | |||||||
30,000,000 - 69,999,999 | 1 | 42,000,000 | 5.8 | |||||||
70,000,000 - 100,000,000 | 3 | 243,803,978 | 33.7 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
Distribution of Underwritten DSCRs(1) | ||||||||||
Range of UW DSCR (x) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
1.17 - 1.30 | 3 | $25,682,154 | 3.6 | % | ||||||
1.31 - 1.50 | 13 | 147,185,564 | 20.3 | |||||||
1.51 - 1.70 | 17 | 207,925,991 | 28.7 | |||||||
1.71 - 1.90 | 8 | 44,908,283 | 6.2 | |||||||
1.91 - 2.10 | 1 | 5,237,304 | 0.7 | |||||||
2.11 - 2.30 | 3 | 147,197,656 | 20.4 | |||||||
2.31 - 2.90 | 3 | 36,186,917 | 5.0 | |||||||
2.91 - 5.42 | 2 | 109,000,000 | 15.1 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
(1) | See footnotes (1) and (7) to the table entitled “Mortgage Pool Characteristics” above. |
Distribution of Amortization Types(1) | ||||||||||
Amortization Type | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
Amortizing (20 Years) | 1 | $4,288,794 | 0.6 | % | ||||||
Amortizing (25 Years) | 2 | 6,787,726 | 0.9 | |||||||
Amortizing (30 Years) | 16 | 209,663,989 | 29.0 | |||||||
Interest Only, Then Amortizing(2) | 26 | 294,228,360 | 40.7 | |||||||
Interest Only | 4 | 108,355,000 | 15.0 | |||||||
Interest Only - ARD | 1 | 100,000,000 | 13.8 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
(1) | All of the mortgage loans will have balloon payments at maturity date or anticipated repayment date. | |
(2) | Original partial interest only periods range from 12 to 72 months. |
Distribution of Lockboxes | ||||||||||
Lockbox Type | Number of MortgageLoans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
Springing | 29 | $385,349,375 | 53.3 | % | ||||||
Hard | 18 | 311,274,495 | 43.0 | |||||||
None | 2 | 16,600,000 | 2.3 | |||||||
Soft Springing | 1 | 10,100,000 | 1.4 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
Distribution of Cut-off Date LTV Ratios(1) | ||||||||||
Range of Cut-off Date LTV (%) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
30.3 - 49.9 | 5 | $145,186,917 | 20.1 | % | ||||||
50.0 - 54.9 | 1 | 3,789,761 | 0.5 | |||||||
55.0 - 59.9 | 8 | 53,952,446 | 7.5 | |||||||
60.0 - 64.9 | 10 | 178,803,023 | 24.7 | |||||||
65.0 - 69.9 | 11 | 159,849,842 | 22.1 | |||||||
70.0 - 74.9 | 11 | 132,398,522 | 18.3 | |||||||
75.0 - 75.9 | 4 | 49,343,360 | 6.8 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
(1) | See footnotes (1) and (5) to the table entitled “Mortgage Pool Characteristics” above. |
Distribution of Maturity Date/ARD LTV Ratios(1) | ||||||||||
Range of Maturity Date/ARD LTV (%) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
26.9 - 39.9 | 3 | $114,224,221 | 15.8 | % | ||||||
40.0 - 44.9 | 8 | 50,021,017 | 6.9 | |||||||
45.0 - 49.9 | 4 | 35,639,060 | 4.9 | |||||||
50.0 - 54.9 | 12 | 160,334,033 | 22.2 | |||||||
55.0 - 59.9 | 11 | 121,047,179 | 16.7 | |||||||
60.0 - 64.9 | 8 | 164,328,360 | 22.7 | |||||||
65.0 - 68.6 | 4 | 77,730,000 | 10.7 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
(1) | See footnotes (1), (3) and (6) to the table entitled “Mortgage Pool Characteristics” above. |
Distribution of Loan Purpose | ||||||||||
Loan Purpose | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
Refinance | 39 | $626,746,237 | 86.6 | % | ||||||
Acquisition | 11 | 96,577,633 | 13.4 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
Distribution of Mortgage Interest Rates | ||||||||||
Range of Mortgage Interest Rates (%) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
3.295 - 4.000 | 9 | $273,741,530 | 37.8 | % | ||||||
4.001 - 4.250 | 9 | 177,673,739 | 24.6 | |||||||
4.251 - 4.500 | 21 | 204,660,059 | 28.3 | |||||||
4.501 - 4.750 | 9 | 54,798,542 | 7.6 | |||||||
4.751 - 4.850 | 2 | 12,450,000 | 1.7 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
B-12 |
Distribution of Debt Yield on Underwritten NOI(1) | ||||||||||
Range of Debt Yields on Underwritten NOI (%) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
7.1 - 7.9 | 2 | $20,248,360 | 2.8 | % | ||||||
8.0 - 8.9 | 9 | 104,890,141 | 14.5 | |||||||
9.0 - 9.9 | 13 | 218,937,520 | 30.3 | |||||||
10.0 - 10.9 | 6 | 82,514,761 | 11.4 | |||||||
11.0 - 11.9 | 7 | 54,812,662 | 7.6 | |||||||
12.0 - 12.9 | 5 | 31,432,665 | 4.3 | |||||||
13.0 - 13.9 | 3 | 87,869,862 | 12.1 | |||||||
14.0 - 19.5 | 5 | 122,617,899 | 17.0 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
(1) | See footnotes (1) and (8) to the table entitled “Mortgage Pool Characteristics” above. |
Distribution of Debt Yield on Underwritten NCF(1) | ||||||||||
Range of Debt Yields on Underwritten NCF (%) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
7.0 - 7.9 | 4 | $37,248,360 | 5.1 | % | ||||||
8.0 - 8.9 | 13 | 235,709,378 | 32.6 | |||||||
9.0 - 9.9 | 13 | 129,536,924 | 17.9 | |||||||
10.0 - 10.9 | 9 | 86,229,654 | 11.9 | |||||||
11.0 - 11.9 | 4 | 31,177,677 | 4.3 | |||||||
12.0 - 13.9 | 3 | 86,041,282 | 11.9 | |||||||
14.0 - 14.9 | 2 | 12,380,595 | 1.7 | |||||||
15.0 - 18.1 | 2 | 105,000,000 | 14.5 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
(1) | See footnotes (1) and (8) to the table entitled “Mortgage Pool Characteristics” above. |
Mortgage Loans with Original Partial Interest Only Periods | ||||||||||
Original Partial Interest Only Period (months) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
12 | 4 | $29,550,000 | 4.1 | % | ||||||
24 | 11 | $96,803,360 | 13.4 | % | ||||||
36 | 5 | $54,075,000 | 7.5 | % | ||||||
60 | 5 | 71,800,000 | 9.9 | % | ||||||
72 | 1 | $42,000,000 | 5.8 | % |
Distribution of Original Terms to Maturity/ARD(1) | ||||||||||
Original Term to Maturity/ARD (months) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
84 | 1 | $2,608,650 | 0.4 | % | ||||||
120 | 49 | 720,715,220 | 99.6 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
(1) | See footnote (3) to the table entitled “Mortgage Pool Characteristics” above. |
Distribution of Remaining Terms to Maturity/ARD(1) | ||||||||||
Range of Remaining Terms to Maturity/ARD (months) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
82 | 1 | $2,608,650 | 0.4 | % | ||||||
115 - 119 | 49 | 720,715,220 | 99.6 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
(1) | See footnote (3) to the table entitled “Mortgage Pool Characteristics” above. |
Distribution of Original Amortization Terms(1) | ||||||||||
Original Amortization Terms (months) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
Interest Only | 5 | $208,355,000 | 28.8 | % | ||||||
240 | 1 | 4,288,794 | 0.6 | |||||||
300 | 2 | 6,787,726 | 0.9 | |||||||
360 | 42 | 503,892,349 | 69.7 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
(1) | All of the mortgage loans will have balloon payments at maturity or anticipated repayment date. |
Distribution of Remaining Amortization Terms(1) | ||||||||||
Range of Remaining Amortization Terms (months) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
Interest Only | 5 | $208,355,000 | 28.8 | % | ||||||
239 | 1 | 4,288,794 | 0.6 | |||||||
299 | 2 | 6,787,726 | 0.9 | |||||||
355 - 360 | 42 | 503,892,349 | 69.7 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
(1) | All of the mortgage loans will have balloon payments at maturity or anticipated repayment date. |
Distribution of Prepayment Provisions | ||||||||||
Prepayment Provision | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
Defeasance | 44 | $624,554,647 | 86.3 | % | ||||||
Yield Maintenance | 6 | 98,769,223 | 13.7 | |||||||
Total | 50 | $723,323,870 | 100.0 | % |
Distribution of Escrow Types | ||||||||||
Escrow Type | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | |||||||
Real Estate Tax | 44 | $676,317,998 | 93.5 | % | ||||||
Replacement Reserves(1) | 41 | $650,147,126 | 89.9 | % | ||||||
TI/LC(2) | 21 | $470,508,186 | 85.0 | % | ||||||
Insurance | 37 | $433,106,792 | 59.9 | % |
(1) | Includes mortgage loans with FF&E reserves. | |
(2) | Percentage of total office, mixed use, retail and industrial properties and one self storage property with office tenants only. |
B-13 |
SHORT TERM CERTIFICATE PRINCIPAL PAY DOWN SCHEDULE |
Class A-2 Principal Pay Down(1) | ||||||||||||||
Mortgage Loan Name | Property Type | Cut-off Date Balance | % of Initial Pool Balance | Remaining Loan Term | Underwritten NCF DSCR | Debt Yield on Underwritten NOI | Cut-off Date LTV Ratio | |||||||
Metro Storage | Self Storage | $2,608,650 | 0.4% | 82 | 1.88x | 12.1% | 58.8% |
(1) | The table above presents the mortgage loan whose balloon payment would be applied to pay down the aggregate principal balance of the Class A-2 certificates assuming a 0% CPR and applying the modeling assumptions described under“Yield, Prepayment and Maturity Considerations”in the Prospectus Supplement, including the assumptions that (i) none of the mortgage loans in the pool experience prepayments prior to the maturity or anticipated repayment date, as applicable, defaults or losses; (ii) there are no extensions of maturity dates of any mortgage loans in the pool; and (iii) each mortgage loan in the pool is paid in full on its stated maturity date or, if applicable, anticipated repayment date. Each class of certificates, including the Class A-2 certificates evidences undivided ownership interests in the entire pool of mortgage loans. Debt service coverage ratio, debt yield and loan-to-value ratio information does not take into account subordinate debt (whether or not secured by the mortgaged property), if any, that is allowed under the terms of any mortgage loan. See Annex A to the Prospectus Supplement. See the footnotes to the table entitled “Mortgage Pool Characteristics” above. |
B-14 |
STRUCTURAL OVERVIEW | |||
Distributions | On each distribution date, funds available for distribution from the mortgage loans, net of specified expenses of the issuing entity, net of yield maintenance charges and prepayment premiums and net of any excess interest distributable on the Class S certificates, will be distributed in the following amounts and order of priority (in each case to the extent of remaining available funds): | ||
1. | Class A-1, A-2, A-3, A-4, A-AB and X-A certificates: To interest on the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class X-A certificates, up to, and pro rata in accordance with, their respective interest entitlements. | ||
2. | Class A-1, A-2, A-3, A-4 and A-AB certificates: to the extent of funds allocable to principal received or advanced on the mortgage loans, (i) to principal on the Class A-AB certificates until their certificate principal amount is reduced to the Class A-AB scheduled principal balance set forth in Annex F to the Prospectus Supplement for the relevant Distribution Date, then (ii) to principal on the Class A-1 certificates until their certificate principal amount is reduced to zero, all funds available for distribution of principal remaining after the distributions to Class A-AB in clause (i) above, then (iii) to principal on the Class A-2 certificates until their certificate principal amount is reduced to zero, all funds available for distribution of principal remaining after the distributions to Class A-1 in clause (ii) above, then (iv) to principal on the Class A-3 certificates until their certificate principal amount is reduced to zero, all funds available for distribution of principal remaining after the distributions to Class A-2 in clause (iii) above, then (v) to principal on the Class A-4 certificates until their certificate principal amount is reduced to zero, all funds available for distribution of principal remaining after the distributions to Class A-3 in clause (iv) above, then (vi) to principal on the Class A-AB certificates until their certificate principal amount is reduced to zero, all funds available for distribution of principal remaining after the distributions to Class A-4 in clause (v) above. However, if the certificate principal amounts of each and every class of certificates other than the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates have been reduced to zero as a result of the allocation of mortgage loan losses and other unanticipated expenses to those certificates, then funds available for distributions of principal will be distributed to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates,pro rata, based on their respective certificate principal amounts (and the schedule for the Class A-AB principal distributions will be disregarded). | ||
3. | Class A-1, A-2, A-3, A-4 and A-AB certificates: To reimburse Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates,pro rata, for any unreimbursed losses on the mortgage loans that were previously allocated to reduce the certificate principal amounts of those classes, together with interest at their respective pass-through rates. | ||
4. | Class A-S and Class PEZ certificates: (i) first, to interest on Class A-S and Class PEZ certificates in the amount of the interest entitlement with respect to the Class A-S trust component,pro rata in proportion to their respective percentage interests in the Class A-S trust component; (ii) next, to the extent of funds allocated to principal remaining after distributions in respect of principal to each class with a higher priority (in this case, the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates), to principal on Class A-S and Class PEZ certificates,pro rata in proportion to their respective percentage interests in the Class A-S trust component, until the certificate principal amount of the Class A-S trust component is reduced to zero; and (iii) next, to reimburse Class A-S and Class PEZ certificates for any unreimbursed losses on the mortgage loans that were previously allocated to reduce the certificate principal amount of the Class A-S trust component, together with interest at the pass-through rate for such trust component,pro rata in proportion to their respective percentage interests in the Class A-S trust component. | ||
5. | Class B and Class PEZ certificates: (i) first, to interest on Class B and Class PEZ certificates in the amount of the interest entitlement with respect to the Class B trust component,pro ratain proportion to their respective percentage interests in the Class B trust component; (ii) next, to the extent of funds allocated to principal remaining after distributions in respect of principal to each class and trust component with a higher priority (in this case, the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S trust component), to principal on Class B and Class PEZ certificates,pro rata in proportion to their respective percentage interests in the Class B trust component, until the certificate principal amount of the Class B trust component is reduced to zero; and (iii) next, to reimburse Class B and Class PEZ certificates for any unreimbursed losses on the mortgage loans that were previously allocated to reduce the certificate principal amount of the Class B trust component, together with interest at the pass-through rate for such trust component,pro rata in proportion to their respective percentage interests in the Class B trust component. |
B-15 |
STRUCTURAL OVERVIEW (continued) | |||
Distributions (continued) | 6. | Class C and Class PEZ certificates: (i) first, to interest on Class C and Class PEZ certificates in the amount of the interest entitlement with respect to the Class C trust component,pro rata in proportion to their respective percentage interests in the Class C trust component; (ii) next, to the extent of funds allocated to principal remaining after distributions in respect of principal to each class and trust component with a higher priority (in this case, the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S and Class B trust components), to principal on Class C and Class PEZ certificates,pro rata in proportion to their respective percentage interests in the Class C trust component, until the certificate principal amount of the Class C trust component is reduced to zero; and (iii) next, to reimburse Class C and Class PEZ certificates for any unreimbursed losses on the mortgage loans that were previously allocated to reduce the certificate principal amount of the Class C trust component, together with interest at the pass-through rate for such trust component,pro rata in proportion to their respective percentage interests in the Class C trust component. | |
7. | Class D certificates: (i) first, to interest on the Class D certificates, up to their interest entitlement; (ii) next, to the extent of funds allocated to principal remaining after distributions in respect of principal to each class and trust component with a higher priority (in this case, the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S, Class B and Class C trust components), to principal on Class D certificates until their certificate principal amount is reduced to zero; and (iii) next, to reimburse Class D certificates for any unreimbursed losses on the mortgage loans that were previously allocated to reduce the certificate principal amount of that class, together with interest at its pass-through rate. | ||
8. | After Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB, Class X-A, Class A-S, Class B, Class PEZ, Class C and Class D certificates are paid all amounts to which they are entitled, the remaining funds available for distribution will be used to pay interest and principal and to reimburse any unreimbursed losses to the Class E, Class F, Class G and Class H certificates sequentially in that order in a manner analogous to the Class D certificates, until the certificate principal amount of each such class is reduced to zero. | ||
Realized Losses | The certificate principal amounts of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB, Class D, Class E, Class F, Class G and Class H certificates and the Class A-S, Class B and Class C trust components (and thus, the Exchangeable Certificates) will each be reduced without distribution on any Distribution Date as a write-off to the extent of any loss realized on the mortgage loans allocated to the such class or trust component on such Distribution Date. On each Distribution Date, any such write-offs will be applied to such classes of certificates and trust components in the following order, in each case until the related certificate principal amount is reduced to zero: first, to the Class H certificates; second, to the Class G certificates; third, to the Class F certificates; fourth, to the Class E certificates; fifth, to the Class D certificates; sixth, to the Class C trust component (and correspondingly to the Class C and Class PEZ certificates,pro rata based on their respective percentage interests in the Class C trust component); seventh, to the Class B trust component (and correspondingly to the Class B and Class PEZ certificates,pro rata based on their respective percentage interests in the Class B trust component); eighth, to the Class A-S trust component (and correspondingly to the Class A-S and Class PEZ certificates,pro rata based on their respective percentage interests in the Class A-S trust component); and, finallypro rata, to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates, based on their then current respective certificate principal amounts. The notional amount of the Class X-A certificates will be reduced to reflect reductions in the certificate principal amounts of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S trust component resulting from allocations of losses realized on the mortgage loans. |
B-16 |
STRUCTURAL OVERVIEW (continued) | |
Prepayment Premiums and Yield Maintenance Charges | On each Distribution Date, each yield maintenance charge collected on the mortgage loans during the applicable one-month period ending on the related Determination Date is required to be distributed as follows: (1) first such yield maintenance charge will be allocatedbetween (x) the group (the “YM Group A”) of Class A-1, Class A-2, Class A-3, Class A-4 and Class A-AB certificates and the Class A-S trust component (and correspondingly the Class A-S and Class PEZ certificates,pro rata based on their respective percentage interests in the Class A-S trust component), and (y) the group (the “YM Group B” and together with the YM Group A, the “YM Groups”), of the Class B trust component (and correspondingly the Class B and Class PEZ certificates,pro rata based on their respective percentage interests in the Class B trust component), the Class C trust component (and correspondingly the Class C and Class PEZ certificates,pro rata based on their respective percentage interests in the Class C trust component) and the Class D certificates,pro rata, based upon the aggregate amount of principal distributed to the classes of certificates (other than the Exchangeable Certificates) and trust components (and, therefore, the applicable classes of Exchangeable Certificates) in each YM Group on such Distribution Date, and (2) then (A) the portion of such yield maintenance charge allocated to each YM Group will be further allocated as among the classes of certificates and trust components in such YM Group in the following manner: each class of certificates (other than the Exchangeable Certificates) and trust components in such YM Group will entitle the applicable certificateholders to receive on the applicable Distribution Date that portion of such yield maintenance charge equal to the product of (x) a fraction whose numerator is the amount of principal distributed to such class of certificates or trust component on such Distribution Date and whose denominator is the total amount of principal distributed to all of the certificates (other than the Exchangeable Certificates) and trust components in that YM Group on such Distribution Date, (y) the Base Interest Fraction for the related principal prepayment and such class of certificates or trust component, and (z) the amount of such yield maintenance charge allocated to such YM Group and (B) the amount of such yield maintenance charge allocated to each YM Group and remaining after such distributions will be distributed to the holders of the Class X-A certificates. If there is more than one class of certificates (other than the Exchangeable Certificates) and/or trust component (and thus the applicable classes of Exchangeable Certificates) in either YM Group entitled to distributions of principal on any particular Distribution Date on which yield maintenance charges are distributable, the aggregate amount of such yield maintenance charges will be allocated among all such classes of certificates (other than the Exchangeable Certificates) and/or trust components (and, therefore, the applicable classes of Exchangeable Certificates) up to, and on apro rata basis in accordance with, their respective entitlements in those yield maintenance charges in accordance with the first sentence of this paragraph. |
The “Base Interest Fraction” with respect to any principal prepayment on any mortgage loan and with respect to any class of Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class D certificates or any trust component is a fraction (a) whose numerator is the amount, if any, by which (i) the pass-through rate on such class of certificates or trust component exceeds (ii) the discount rate used in accordance with the related loan documents in calculating the yield maintenance charge with respect to such principal prepayment and (b) whose denominator is the amount, if any, by which (i) the mortgage loan rate on such mortgage loan exceeds (ii) the discount rate used in accordance with the related loan documents in calculating the yield maintenance charge with respect to such principal prepayment; provided, however, that under no circumstances shall the Base Interest Fraction be greater than one. However, if such discount rate is greater than or equal to both of (x) the mortgage loan rate on the prepaid mortgage loan and (y) the pass-through rate described in the preceding sentence, then the Base Interest Fraction will equal zero, and if such discount rate is greater than or equal to the mortgage loan rate described in the preceding sentence, but less than the pass-through rate, the fraction will be one. | |
If a prepayment premium is imposed in connection with a prepayment rather than a yield maintenance charge, then the prepayment premium so collected will be allocated as described above. For this purpose, the discount rate used to calculate the Base Interest Fraction will be the discount rate used to determine the yield maintenance charge for mortgage loans that require payment at the greater of a yield maintenance charge or a minimum amount equal to a fixed percentage of the principal balance of the mortgage loan or, for mortgage loans that only have a prepayment premium based on a fixed percentage of the principal balance of the mortgage loan, such other discount rate as may be specified in the related loan documents. | |
No prepayment premiums or yield maintenance charges will be distributed to holders of the Class E, Class F, Class G, Class H, Class S or Class R certificates. Instead, after the notional amount of the Class X-A certificates and the certificate principal amounts of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class D certificates and the trust components have been reduced to zero, all prepayment premiums and yield maintenance charges with respect to the mortgage loans will be distributed to holders of the Class X-A certificates. For a description of prepayment premiums and yield maintenance charges required on the mortgage loans, see Annex A to the Prospectus Supplement. See also “Certain Legal Aspects of the Mortgage Loans—Default Interest and Limitations on Prepayments” in the Base Prospectus. Prepayment premiums and yield maintenance charges will be distributed on any Distribution Date only to the extent they are received in respect of the mortgage loans as of the related Determination Date. |
B-17 |
STRUCTURAL OVERVIEW (continued) | ||
Advances | The master servicer and, if it fails to do so, the trustee, will be obligated to make P&I advances with respect to each mortgage loan in the issuing entity and, with respect to all of the serviced loans, servicing advances, including paying delinquent property taxes, condominium assessments, insurance premiums and ground lease rents, but only to the extent that those advances are not deemed non-recoverable from collections on the related mortgage loan and, in the case of P&I advances, subject to reduction in connection with any appraisal reductions that may occur. | |
Serviced Mortgage Loans / Outside Serviced Mortgage Loans | Each of (i) the Selig Office Portfolio loan combination, (ii) the Dallas Market Center loan combination and (iii) the Crowne Plaza Bloomington loan combination constitutes an “outside serviced loan combination,” each related mortgage loan constitutes an “outside serviced mortgage loan” and each related companion loan constitutes an “outside serviced companion loan.” Each outside serviced mortgage loan will be serviced under a pooling and servicing agreement other than the CGCMT 2015-GC31 pooling and servicing agreement (such other pooling and servicing agreement, an “outside servicing agreement”) as reflected in the “Pari Passu Companion Loan Summary” table above. All of the mortgage loans transferred to the issuing entity (other than any outside serviced mortgage loan) are sometimes referred to in this Term Sheet as the “serviced mortgage loans” or the “serviced loans” (which signifies that they are being serviced by the master servicer and the special servicer under the CGCMT 2015-GC31 pooling and servicing agreement). See“—Loan Combinations”below. | |
Appraisal Reduction Amounts | An appraisal reduction amount generally will be created with respect to a required appraisal loan (which is a serviced loan as to which certain defaults, modifications or insolvency events have occurred (as further described in the Prospectus Supplement)) in the amount, if any, by which the principal balance of such required appraisal loan, plus other amounts overdue or advanced in connection with such required appraisal loan, exceeds 90% of the appraised value of the related mortgaged property plus certain escrows and reserves (including letters of credit) held with respect to such required appraisal loan. In general, any appraisal reduction amount calculated with respect to a loan combination will be allocatedfirst, to any related subordinate companion loan (up to the outstanding principal balance thereof), andthen, to the related mortgage loan and any relatedpari passucompanion loan(s) on apro rata basis in accordance with their respective outstanding principal balances. In the case of an outside serviced mortgage loan, any appraisal reduction amounts will be calculated pursuant to, and by a party to, the related outside servicing agreement (as discussed under “—Loan Combinations” below). As a result of an appraisal reduction amount being calculated for and/or allocated to a given mortgage loan, the interest portion of any P&I advance for such mortgage loan will be reduced, which will have the effect of reducing the amount of interest available for distribution to the most subordinate class(es) of certificates (exclusive of the Exchangeable Certificates, Class S and Class R certificates) and/or trust components then outstanding (i.e., first to the Class H certificates, then to the Class G certificates, then to the Class F certificates, then to the Class E certificates, then to the Class D certificates, then to the Class C trust component (and correspondingly, to the Class C certificates and the Class PEZ certificates,pro rata based on their respective percentage interests in the Class C trust component), then to the Class B trust component (and correspondingly, to the Class B certificates and the Class PEZ certificates,pro rata based on their respective percentage interests in the Class B trust component), then to the Class A-S trust component (and correspondingly, to the Class A-S certificates and the Class PEZ certificates,pro rata based on their respective percentage interests in the Class A-S trust component), and then,pro rata based on interest entitlements, to the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class X-A certificates). In general, a serviced loan will cease to be a required appraisal loan, and no longer be subject to an appraisal reduction amount, when the same has ceased to be a specially serviced loan (if applicable), has been brought current for at least three consecutive months and no other circumstances exist that would cause such serviced loan to be a required appraisal loan. | |
At any time an Appraisal is ordered with respect to a property that would result in appraisal reduction amount with respect to a serviced loan that would result in a change in the controlling class, certain certificateholders will have a right to request a new appraisal as described in the Prospectus Supplement. | ||
Age of Appraisals | Appraisals (which can be an update of a prior appraisal) with respect to a serviced loan are required to be no older than 9 months for purposes of determining appraisal reductions (other than the annual re-appraisal), market value, and other calculations as described in the Prospectus Supplement. | |
Sale of Defaulted Loans | There will be no “Fair Market Value Purchase Option”. Instead defaulted mortgage loans will be sold in a process similar to the sale process for REO property. With respect to an outside serviced loan combination, the party acting as special servicer with respect to such outside serviced loan combination (as discussed under “—Loan Combinations” below) pursuant to the related outside servicing agreement (the “outside special servicer”) may offer to sell to any person (or may offer to purchase) for cash such outside serviced loan combination in accordance with the terms of the related outside servicing agreement during such time as such outside serviced loan combination constitutes a sufficiently defaulted mortgage loan thereunder and, in connection with any such sale, the related outside special servicer is required to sell both the applicable outside serviced mortgage loan and the related outside serviced companion loan(s) as one loan combination. |
B-18 |
STRUCTURAL OVERVIEW (continued) | ||
Cleanup Call | On any distribution date on which the aggregate unpaid principal balance of the mortgage loans remaining in the issuing entity is less than 1% of the aggregate principal balance of the pool of mortgage loans as of the Cut-off Date, certain specified persons will have the option to purchase all of the remaining mortgage loans (and all property acquired through exercise of remedies in respect of any mortgage loan) at the price specified in the Prospectus Supplement. Exercise of the option will terminate the issuing entity and retire the then outstanding certificates. | |
If the aggregate certificate principal amounts of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB and Class D certificates and the Class A-S, Class B and Class C trust components and the notional amount of the Class X-A certificates have been reduced to zero and if the master servicer has received from the remaining certificateholders the payment specified in the CGCMT 2015-GC31 pooling and servicing agreement, the issuing entity could also be terminated in connection with an exchange of all the then-outstanding certificates (excluding the Class S and Class R certificates), for the mortgage loans remaining in the issuing entity, but all of the holders of those classes of outstanding certificates would have to voluntarily participate in the exchange | ||
Directing Holder | The “Directing Holder” with respect to any mortgage loan serviced under the CGCMT 2015-GC31 pooling and servicing agreement will be the Controlling Class Representative. | |
Controlling Class Representative | The “Controlling Class Representative” will be the controlling class certificateholder or other representative designated by at least a majority of the controlling class certificateholders (by certificate principal amount). The “controlling class” is the most subordinate class of the Control Eligible Certificates that has an outstanding certificate principal amount as notionally reduced by any appraisal reduction amounts allocated to such class, that is equal to or greater than 25% of the initial certificate principal amount of that class of certificates, or if no such class meets the preceding requirement, then the Class F certificates will be the controlling class; provided, however, that (at any time that the aggregate certificate principal amount of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB, Class D and Class E certificates and the Class A-S, Class B and Class C trust components has been reduced to zero without regard to the allocation of appraisal reduction amounts) (A) in the case of any class of Control Eligible Certificates to which the designation of “controlling class” would otherwise shift by operation of this definition, where the certificate principal amount of such class of Control Eligible Certificates has been reduced to zero (without regard to the allocation of appraisal reduction amounts) prior to such shift, then designation of “controlling class” shall not shift and shall remain with the class of Control Eligible Certificates currently designated as the controlling class, and (B) in the case of any class of Control Eligible Certificates which is then designated the “controlling class”, if the certificate principal amount of such class of Control Eligible Certificates is reduced to zero (without regard to the allocation of appraisal reduction amounts), then the designation of “controlling class” shall shift to the class of Control Eligible Certificates that is the most subordinate and that also has a remaining certificate principal amount. The “Control Eligible Certificates” consist of the Class F, Class G and Class H certificates. See “The Pooling and Servicing Agreement—Directing Holder” in the Prospectus Supplement. No other class of certificates will be eligible to act as the controlling class or appoint a Controlling Class Representative. | |
It is anticipated that Torchlight Investors, LLC on behalf of one or more managed funds, will be the initial controlling class certificateholder(s) and is expected to appoint Torchlight Investors, LLC to be the initial Controlling Class Representative. | ||
Control Termination Event | A “Control Termination Event” will occur when no class of the Control Eligible Certificates has an outstanding certificate principal amount as notionally reduced by any appraisal reduction amounts allocated to such class, that is equal to or greater than 25% of the initial certificate principal amount of that class of certificates or when a Control Termination Event is deemed to have occurred pursuant to the terms of the CGCMT 2015-GC31 pooling and servicing agreement; provided, however, that a Control Termination Event will in no event exist at any time that the aggregate certificate principal amount of each class of certificates (other than the Control Eligible Certificates) (without regard to the allocation of appraisal reduction amounts) has been reduced to zero. | |
Consultation Termination Event | A “Consultation Termination Event” will occur when no class of Control Eligible Certificates has an outstanding certificate principal amount, without regard to the allocation of any appraisal reduction amounts, that is equal to or greater than 25% of the initial certificate principal amount of that class of certificates or when a Consultation Termination Event is deemed to have occurred pursuant to the terms of the CGCMT 2015-GC31 pooling and servicing agreement; provided, however, that a Consultation Termination Event will in no event exist at any time that the aggregate certificate principal amount of each class of certificates (other than the Control Eligible Certificates) (without regard to the allocation of appraisal reduction amounts) has been reduced to zero. |
B-19 |
STRUCTURAL OVERVIEW (continued) | ||
Control/Consultation Rights | So long as a Control Termination Event does not exist, the Directing Holder will be entitled to have consent and/or consultation rights under the CGCMT 2015-GC31 pooling and servicing agreement with respect to certain major decisions (including with respect to assumptions, waivers, loan modifications and workouts) and other matters with respect to each serviced mortgage loan. | |
After the occurrence and during the continuance of a Control Termination Event, the consent rights of the Controlling Class Representative will terminate, and the Controlling Class Representative will retain consultation rights under the CGCMT 2015-GC31 pooling and servicing agreement with respect to certain major decisions and other matters with respect to the serviced mortgage loans. | ||
After the occurrence and during the continuance of a Consultation Termination Event, all of these rights of the Controlling Class Representative with respect to the serviced mortgage loans will terminate. | ||
If at any time that the current holder of the Controlling Class (or its designee) or one of its affiliates, or any successor Controlling Class Representative or Controlling Class Certificateholder(s) is no longer the certificateholder (or beneficial owner) of at least a majority of the Controlling Class by certificate principal amount and the certificate administrator has neither (i) received notice of the then-current holders (or, in the case of book-entry certificates, beneficial owners) of at least a majority of the Controlling Class by certificate principal amount nor (ii) received notice of a replacement Controlling Class Representative pursuant to the CGCMT 2015-GC31 pooling and servicing agreement, then a Control Termination Event and a Consultation Termination Event will be deemed to have occurred and will be deemed to continue until such time as the certificate administrator receives either such notice. | ||
With respect to an outside serviced loan combination, the Controlling Class Representative (prior to the occurrence of a Consultation Termination Event) will have limited consultation rights, and the applicable outside controlling class representative pursuant to, and subject to the limitations set forth in, the related outside servicing agreement will have consultation, approval and direction rights, with respect to certain major decisions (including with respect to assumptions, waivers, loan modifications and workouts) regarding such outside serviced loan combination, as provided for in the related co-lender agreement and in the related outside servicing agreement, and as described under “Description of the Mortgage Pool—The Loan Combinations” in the Prospectus Supplement. | ||
Loan Combinations | The Selig Office Portfolio mortgage loan (evidenced by note A-3), which represents the non-controlling interest in the Selig Office Portfolio loan combination, will be contributed to the issuing entity, has an outstanding principal balance as of the Cut-off Date of $72,000,000 and represents approximately 9.95% of the Initial Pool Balance. The related controlling companion loan evidenced by note A-1 was contributed to the CGCMT 2015-GC29 securitization transaction, the related non-controlling companion loan evidenced by note A-2 was contributed to the GSMS 2015-GC30 securitization transaction, and the related non-controlling companion loan evidenced by note A-4 is currently held by Goldman Sachs Mortgage Company outside the issuing entity, and is expected to be contributed to one or more future commercial mortgage securitization transactions. The Selig Office Portfolio companion loans have an aggregate outstanding principal balance as of the Cut-off Date of $273,000,000. The Selig Office Portfolio mortgage loan and the related companion loans will be serviced pursuant to the CGCMT 2015-GC29 pooling and servicing agreement. | |
The Dallas Market Center mortgage loan (evidenced by note A-2), which represents the non-controlling interest in the Dallas Market Center loan combination, will be contributed to the issuing entity, has an outstanding principal balance as of the Cut-off Date of $71,803,978 and represents approximately 9.9% of the Initial Pool Balance. The related controlling companion loan evidenced by note A-1 was contributed to the GSMS 2015-GC30 securitization transaction, and the related non-controlling companion loan evidenced by note A-3 is currently held by Goldman Sachs Mortgage Company outside the issuing entity, and is expected to be contributed to one or more future commercial mortgage securitization transactions. The Dallas Market Center companion loans have an aggregate outstanding principal balance as of the Cut-off Date of $186,490,887. The Dallas Market Center mortgage loan and the related companion loans will be serviced pursuant to the GSMS 2015-GC30 pooling and servicing agreement. | ||
The Crowne Plaza Bloomington mortgage loan (evidenced by note A-2), which represents the non-controlling interest in the Crowne Plaza Bloomington loan combination, will be contributed to the issuing entity, has an outstanding principal balance as of the Cut-off Date of $12,170,872 and represents approximately 1.7% of the Initial Pool Balance. The related companion loan (evidenced by note A-1), represents the controlling interest in the Crowne Plaza Bloomington loan combination and was contributed to the CGCMT 2015-GC29 securitization transaction. The Crowne Plaza Bloomington companion loan has an outstanding principal balance as of the Cut-off Date of $13,909,568. The Crowne Plaza Bloomington mortgage loan and the related companion loan will be serviced pursuant to the CGCMT 2015-GC29 pooling and servicing agreement. |
B-20 |
STRUCTURAL OVERVIEW (continued) | ||
Servicing Standard | Each of the serviced loans will be serviced by the master servicer and the special servicer pursuant to the terms of the CGCMT 2015-GC31 pooling and servicing agreement. In all circumstances, each of the master servicer and the special servicer is obligated to act in the best interests of the certificateholders as a collective whole as if such certificateholders constituted a single lender. The special servicer is required to determine the effect on net present value of various courses of action (including workout or foreclosure), using the Calculation Rate as the discount rate, and pursue the course of action that it determines would maximize recovery on a net present value basis. | |
“Calculation Rate” means: | ||
for principal and interest payments on a mortgage loan or proceeds from the sale of a defaulted loan, the highest of (i) the rate determined by the master servicer or the special servicer, as applicable, that approximates the market rate that would be obtainable by borrowers on similar debt of the borrowers as of such date of determination, (ii) the mortgage loan rate and (iii) the yield on 10-year US treasuries; and for all other cash flows, including property cash flow, the “discount rate” set forth in the most recent appraisal (or update of such appraisal). | ||
Termination of Special Servicer | Prior to the occurrence and continuance of a Control Termination Event, the special servicer may be removed and replaced by the Controlling Class Representative with or without cause at any time. | |
After the occurrence and during the continuance of a Control Termination Event, the holders of at least 25% of the voting rights of the certificates (other than the Class S and Class R certificates) may request a vote to replace the special servicer. The subsequent vote may result in the termination and replacement of the special servicer if, within 180 days of the initial request for that vote, the holders of (a) at least 75% of the voting rights of the certificates (other than the Class S and Class R certificates), or (b) more than 50% of the voting rights of each class of Non-Reduced Certificates (as defined under “Certain Definitions” below) vote affirmatively to so replace. | ||
Additionally, at any time after the occurrence and during the continuance of a Consultation Termination Event, if the operating advisor determines that the special servicer is not performing its duties as required under the CGCMT 2015-GC31 pooling and servicing agreement or is otherwise not acting in accordance with the servicing standard, the operating advisor may recommend the replacement of the special servicer (but not any outside special servicer for any outside serviced loan combination), resulting in a solicitation of a certificateholder vote. The subsequent vote may result in the termination and replacement of the special servicer if, within 180 days of the initial request for that vote, the holders of more than 50% of the voting rights of each class of Non-Reduced Certificates vote affirmatively to so replace. | ||
The related outside special servicer under each outside servicing agreement generally may be replaced by the related outside controlling class representative or the vote of the requisite holders of certificates issued under that outside servicing agreement (depending on whether or not a control termination event or a consultation termination event exists under that outside servicing agreement) in a manner similar to the manner in which the special servicer may be replaced under the CGCMT 2015-GC31 pooling and servicing agreement as described in the three preceding paragraphs. |
B-21 |
STRUCTURAL OVERVIEW (continued) | ||
Servicing Compensation | Modification Fees: Certain fees resulting from modifications, amendments, waivers or other changes to the terms of the loan documents, as more fully described in the Prospectus Supplement, will be used to offset expenses on the related serviced mortgage loan (i.e. reimburse the trust for certain expenses including unreimbursed advances and interest on unreimbursed advances previously incurred (other than special servicing fees, workout fees and liquidation fees) on the related serviced mortgage loan but not yet reimbursed to the trust or servicers or to pay expenses (other than special servicing fees, workout fees and liquidation fees) that are still outstanding in each case unless as part of the written modification the related borrower is required to pay these amounts on a going forward basis or in the future). Any excess modification fees not so applied to offset expenses will be available as compensation to the master servicer and/or special servicer. Within any prior 12 month period, all such excess modification fees earned by the master servicer or by the special servicer (after taking into account the offset described below applied during such 12-month period) with respect to any serviced mortgage loan will be subject to a cap equal to the greater of (i) 1% of the outstanding principal balance of such mortgage loan after giving effect to such transaction and (ii) $25,000. | |
All excess modification fees earned by the special servicer will be required to offset any future workout fees or liquidation fees payable with respect to the related serviced mortgage loan or related REO property; provided, that if the serviced mortgage loan ceases being a corrected loan, and is subject to a subsequent modification, any excess modification fees earned by the special servicer prior to such serviced mortgage loan ceasing to be a corrected loan will no longer be offset against future liquidation fees and workout fees unless such serviced mortgage loan ceased to be a corrected loan within 18 months of it becoming a modified mortgage loan. | ||
Penalty Fees: All late fees and default interest will first be used to reimburse certain expenses previously incurred with respect to the related mortgage loan (other than special servicing fees, workout fees and liquidation fees) but not yet reimbursed to the trust, the master servicer or the special servicer or to pay certain expenses (other than special servicing fees, workout fees and liquidation fees) that are still outstanding on the related mortgage loan, and any excess received with respect to a serviced loan will be paid to the master servicer (for penalty fees accrued while a non-specially serviced loan) and the special servicer (for penalty fees accrued while a specially serviced loan). To the extent any amounts reimbursed out of penalty charges are subsequently recovered on a related serviced loan, they will be paid to the master servicer or special servicer who would have been entitled to the related penalty charges that were previously used to reimburse such expense. | ||
Liquidation / Workout Fees: Liquidation fees will be calculated at the lesser of (a) 1.0% and (b) such rate as would result in a liquidation fee of $1,000,000, for each serviced loan that is a specially serviced loan and any REO property, subject in any case to a minimum liquidation fee of $25,000. For any serviced loan that is a corrected loan, workout fees will be calculated at the lesser of (a) 1.0% and (b) such rate as would result in a workout fee of $1,000,000 when applied to each expected payment of principal and interest (other than default interest and excess interest) on the related serviced loan from the date such serviced loan becomes a corrected mortgage loan through and including the then related maturity date; or in any case such higher rate as would result in a workout fee of $25,000 when applied to each expected payment of principal and interest (other than default interest and excess interest) on the related serviced loan from the date such serviced loan becomes a corrected loan through and including the then related maturity date. | ||
Notwithstanding the foregoing, in connection with a maturity default, no liquidation or workout fee will be payable in connection with a payoff or refinancing of the related serviced loan within 90 days of the maturity default. | ||
In the case of an outside serviced loan combination, calculation of the foregoing amounts payable to the related outside servicer or outside special servicer may be different than as described above. For example, the extent to which modification fees and penalty fees are applied to offset expenses may be different and liquidation fees and workout fees may be subject to different caps. |
B-22 |
STRUCTURAL OVERVIEW (continued) | |||
Operating Advisor | Prior to the occurrence of a Control Termination Event, the operating advisor will review certain information on the certificate administrator’s website, and will have access to any related final asset status report but will not have any approval or consultation rights. After a Control Termination Event, the operating advisor will have consultation rights with respect to certain major decisions with respect to the serviced loan(s) and will have additional monitoring responsibilities on behalf of the entire trust. | ||
After the occurrence and during the continuance of a Control Termination Event, the operating advisor will be entitled to consult with the special servicer with respect to certain major decisions on behalf of the issuing entity and in the best interest of, and for the benefit of, the certificateholders, as a collective whole, as if those certificateholders constituted a single lender. | |||
The operating advisor will be subject to termination if the holders of at least 15% of the voting rights of Non-Reduced Certificates vote to terminate and replace the operating advisor and such vote is approved by the holders of more than 50% of the voting rights of Non-Reduced Certificates that exercise their right to vote, provided that the holders of at least 50% of the voting rights of Non-Reduced Certificates have exercised their right to vote. The holders initiating such vote will be responsible for the fees and expenses in connection with the vote and replacement. | |||
Deal Website | The certificate administrator will maintain a deal websiteincluding, but not limited to: | ||
— | all special notices delivered | ||
— | summaries of final asset status reports | ||
— | all appraisals in connection with an appraisal reduction plus any subsequent appraisal updates | ||
— | an “Investor Q&A Forum” and a voluntary investor registry |
B-23 |
CERTAIN DEFINITIONS |
■ | “ADR”: Means, for any hospitality property, average daily rate. |
■ | “Appraised Value”: With respect to each mortgaged property and any date of determination, the most current appraised value of such property as determined by an appraisal of the mortgaged property and in accordance with MAI standards made not more than four (4) months prior to the origination date of the related mortgage loan. With respect to the Rockside Road Office Portfolio mortgage loan, the appraised value of the portfolio of mortgaged properties taken as a whole includes, in each applicable circumstance, a 5.0% premium over the sum of the applicable appraised values of the individual mortgaged properties included in such portfolio (regardless of whether any such individual appraised value is, depending on the purpose for which it is being used, an “as-is” or “as stabilized” value). With respect to the NY Seven Self Storage Portfolio mortgage loan, the appraised value of the portfolio of mortgaged properties taken as a whole includes an approximately 7.5% premium over the sum of the appraised values of the individual mortgaged properties included in such portfolio. See “Description of the Mortgage Pool—Certain Calculations and Definitions” in the Prospectus Supplement for a description of Maturity Date/ARD LTV Ratio. |
■ | “Borrower Sponsor”: The indirect owner, or one of the indirect owners, of the related borrower (in whole or in part) that may or may not have control of the related borrower. The Borrower Sponsor may be, but is not necessarily, the entity that acts as the guarantor of the non-recourse carveouts. |
■ | “FF&E”: Furniture, fixtures and equipment. |
■ | “GLA”: Gross leasable area. |
■ | “Hard Lockbox”: Means that the borrower is required to direct the tenants to pay rents directly to a lockbox account controlled by the lender. Hospitality and multifamily properties are considered to have a hard lockbox if credit card receivables are required to be deposited directly into the lockbox account even though cash, checks or “over the counter” receipts are deposited by the manager of the related mortgaged property into the lockbox account controlled by the lender. |
■ | “Non-owned Anchor(s)”: Tenants that occupy space equal to or greater than 30,000 SF at the related mortgaged property, which occupied space is not owned by the related borrower and is not part of the collateral for the related mortgage loan. |
■ | “Non-owned Junior Anchor(s)”: Tenants that occupy space equal to or greater than 10,000 SF at the related mortgaged property and less than 30,000 SF at the related mortgaged property, which occupied space is not owned by the related borrower and is not part of the collateral for the related mortgage loan. |
■ | “Non-owned Outparcel(s)”: Freestanding tenants that occupy space at the property that is separated from the rest of the tenants at the applicable mortgaged property which space occupied by those freestanding tenants is not owned by the related borrower and is not part of the collateral for the related mortgage loan. |
■ | “Non-Reduced Certificates”: Each class of certificates (other than Class S, Class R or Class X-A certificates)(considering each class of the Class A-S, Class B and Class C certificates, together with the Class PEZ certificates’ applicable percentage interest of the trust component with the same alphabetic class designation, as a single “Class” for such purpose) that has an outstanding certificate principal amount as may be notionally reduced by any appraisal reduction amounts allocated to that class, equal to or greater than 25% of an amount equal to the initial certificate principal amount of that class of certificates minus all principal payments made on such class of certificates. |
■ | “Occupancy Cost”: With respect to any mortgaged property, total rental revenues divided by total sales. |
■ | “Owned Anchor(s)”: Tenants that lease space equal to or greater than 30,000 SF at the related mortgaged property, which leased space is owned by the related borrower and is part of the collateral for the related mortgage loan. |
■ | “Owned GLA”: With respect to any particular mortgaged property, the GLA of the space that is owned by the related borrower and is part of the collateral. |
■ | “Owned Junior Anchor(s)”: Tenants that lease space equal to or greater than 10,000 SF and less than 30,000 SF at the related mortgaged property, which leased space is owned by the related borrower and is part of the collateral for the related mortgage loan. |
■ | “Owned Occupancy”: With respect to any particular mortgaged property, as of a certain date (or, in the case of a hospitality property, for a trailing 12-month period ending on a certain date), the percentage of net rentable square footage, available rooms, units or beds that are leased or rented (as applicable), solely with respect to the aggregate leased space, available rooms, units or beds in the property that is owned by the related borrower. In some cases Owned Occupancy was based on assumptions regarding occupancy, such as the assumption that a certain tenant at the mortgaged property that has executed a lease, but has not yet taken occupancy and/or has not yet commenced paying rent, will take occupancy on a future date generally expected to occur within twelve months after the Cut-off Date; assumptions regarding the renewal of particular leases and/or the re-leasing of certain space at the related mortgaged property; in some cases, assumptions regarding leases under negotiation being executed; in some cases, assumptions regarding tenants taking additional space in the future if currently committed to do so or, in some cases, the exclusion of dark tenants, tenants with material aged receivables, tenants that may have already given notice to vacate their space, bankrupt tenants that have not yet affirmed their lease and certain additional leasing assumptions. |
■ | “Owned Outparcel(s)”: Freestanding tenants that occupy space at the property that is separated from the rest of the tenants at the applicable mortgaged property which space occupied by those freestanding tenants is owned by the related borrower and is part of the collateral for the related mortgage loan. |
B-24 |
CERTAIN DEFINITIONS (continued) |
■ | “Owned Tenant(s)”: Tenants whose leased space at the related mortgaged property is owned by the related borrower and is part of the collateral for the related mortgage loan. |
■ | “Rating Agency Confirmation”: With respect to any matter, confirmation in writing (which may be in electronic form) by the rating agencies engaged by the depositor that a proposed action, failure to act or other event so specified will not, in and of itself, result in the downgrade, qualification or withdrawal of the then current rating assigned by that rating agency to any class of certificates. However, such confirmation will be deemed received or not required in certain circumstances as further described in the Prospectus Supplement. See “The Pooling and Servicing Agreement—Rating Agency Confirmations”in the Prospectus Supplement. |
■ | “RevPAR”: With respect to any hospitality property, revenues per available room. |
■ | “SF”:Square feet. |
■ | “Soft Lockbox”: An account into which the related borrower is required to deposit or cause the property manager to deposit all rents collected. Hospitality and multifamily properties are considered to have a soft lockbox if credit card receivables, cash, checks or “over the counter” receipts are deposited into the lockbox account by the borrower or property manager. |
■ | “Soft Springing Lockbox”: An account into which the related borrower is required to deposit, or cause the property manager to deposit, all rents collected until the occurrence of an event of default under the loan documents or one or more specified trigger events, at which time the lockbox converts to a Hard Lockbox. |
■ | “Springing Lockbox”: An account that is not currently in place, but the related loan documents require the imposition of a lockbox account upon the occurrence of an event of default under the loan documents or one or more specified trigger events. |
■ | “Total Occupancy”: With respect to any particular mortgaged property, as of a certain date (or, in the case of a hospitality property, for a trailing 12-month period ending on a certain date), the percentage of net rentable square footage, available rooms, units or beds that are leased or rented (as applicable), for the aggregate leased space, available rooms, units or beds at the property, including any space that is owned by the related borrower and is part of the collateral in addition to any space that is owned by the applicable tenant and not part of the collateral for the related mortgage loan. In some cases Total Occupancy was based on assumptions regarding occupancy, such as the assumption that a certain tenant at the mortgaged property that has executed a lease, but has not yet taken occupancy and/or has not yet commenced paying rent, will take occupancy on a future date generally expected to occur within twelve months after the Cut-off Date; assumptions regarding the renewal of particular leases and/or the re-leasing of certain space at the related mortgaged property; in some cases, assumptions regarding leases under negotiation being executed; in some cases, assumptions regarding tenants taking additional space in the future if currently committed to do so or, in some cases, the exclusion of dark tenants, tenants with material aged receivables, tenants that may have already given notice to vacate their space, bankrupt tenants that have not yet affirmed their lease and certain additional leasing assumptions. |
■ | “TRIPRA”: Means the Terrorism Risk Insurance Program Reauthorization Act of 2015. |
■ | “TTM”: Means trailing twelve months. |
■ | “Underwritten Expenses”: With respect to any mortgage loan or mortgaged property, an estimate of operating expenses, as determined by the related originator and generally derived from historical expenses at the mortgaged property(-ies), the borrower’s budget or appraiser’s estimate, in some cases adjusted for significant occupancy increases and a market-rate management fee. We cannot assure you that the assumptions made with respect to any mortgaged property will, in fact, be consistent with that mortgaged property’s actual performance. |
■ | “Underwritten Net Cash Flow (NCF)”: With respect to any mortgage loan or mortgaged property, cash flow available for debt service, generally equal to the Underwritten NOI decreased by an amount that the related originator has determined for tenant improvements and leasing commissions and / or replacement reserves for capital items. Underwritten NCF does not reflect debt service or non-cash items such as depreciation or amortization. The Underwritten Net Cash Flow for each mortgaged property is calculated based on the basis of numerous assumptions and subjective judgments (including, but not limited to, with respect to future occupancy and rental rates), which, if ultimately proved erroneous, could cause the actual net cash flow for the mortgaged property to differ materially from the Underwritten Net Cash Flow set forth in this Term Sheet. |
■ | “Underwritten Net Operating Income (NOI)”: With respect to any mortgage loan or mortgaged property, Underwritten Revenues less Underwritten Expenses, as both are determined by the related originator, based in part upon borrower supplied information (including but not limited to a rent roll, leases, operating statements and budget) for a recent period which is generally the 12 months prior to the origination date or acquisition date of the mortgage loan (or loan combination, if applicable) adjusted for specific property, tenant and market considerations. Historical operating statements may not be available for newly constructed mortgaged properties, mortgaged properties with triple net leases, mortgaged properties that have recently undergone substantial renovations and/or newly acquired mortgaged properties. |
B-25 |
CERTAIN DEFINITIONS (continued) |
■ | “Underwritten Revenues”:With respect to any mortgage loan or mortgaged property, an estimate of operating revenues, as determined by the related originator and generally derived from the rental revenue (which may include rental revenue related to reimbursement of tenant improvements and leasing commissions) based on leases in place, leases that have been executed but the tenant is not yet paying rent, month-to-month leases (based on current rent roll and annualized), in certain cases leases that are being negotiated and are expected to be signed, in certain cases leases that provide for a tenant to take additional space as described under“Description of the Mortgage Pool—Tenant Issues” in the Prospectus Supplement to the extent material, and in certain cases contractual rent steps generally within 12 months past the Cut-off Date, in certain cases certain appraiser estimates of rental income, and in some cases adjusted downward to market rates, with vacancy rates equal to the mortgaged property’s historical rate, current rate, market rate or an assumed vacancy as determined by the related originator; plus any additional recurring revenue fees. Additionally, in determining rental revenue for multifamily rental, manufactured housing community and self storage properties, the related originator either reviewed rental revenue shown on the certified rolling 12-month operating statements or annualized the rental revenue and reimbursement of expenses shown on rent rolls or recent partial year operating statements with respect to the prior one- to 12-month period or in some cases may have relied on information provided in the appraisal for market rental rates and vacancy. In certain cases, with respect to mortgaged properties with leases with rent increases or rent decreases during the term of the related mortgage loan, Underwritten Revenues were based on the average rent over the term of the mortgage loan. In certain cases, the related originator included revenue otherwise payable by a tenant but for the existence of an initial “free rent” period or a permitted rent abatement while the leased space is built out. We cannot assure you that the assumptions made with respect to any mortgaged property will, in fact, be consistent with that mortgaged property’s actual performance. |
B-26 |
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B-27 |
135 SOUTH LASALLE |
B-28 |
135 SOUTH LASALLE |
B-29 |
135 SOUTH LASALLE |
B-30 |
135 SOUTH LASALLE |
Mortgaged Property Information | Mortgage Loan Information | |||||
Number of Mortgaged Properties | 1 | Loan Seller | CGMRC | |||
Location (City/State) | Chicago, Illinois | Cut-off Date Principal Balance | $100,000,000 | |||
Property Type | Office | Cut-off Date Principal Balance per SF | $76.33 | |||
Size (SF) | 1,310,047 | Percentage of Initial Pool Balance | 13.8% | |||
Total Occupancy as of 3/31/2015 | 95.7% | Number of Related Mortgage Loans | None | |||
Owned Occupancy as of 3/31/2015 | 95.7% | Type of Security | Fee Simple | |||
Year Built / Latest Renovation | 1934 / 2013-2014 | Mortgage Rate(1) | 3.2950% | |||
Appraised Value | $330,000,000 | Original Term to Maturity (Months)(2) | 120 | |||
Original Amortization Term (Months) | NAP | |||||
Original Interest Only Period (Months) | 120 | |||||
Underwritten Revenues | $39,738,720 | |||||
Underwritten Expenses | $20,209,421 | Escrows | ||||
Underwritten Net Operating Income (NOI) | $19,529,300 | Upfront | Monthly | |||
Underwritten Net Cash Flow (NCF) | $18,111,245 | Taxes | $2,686,535 | $671,634 | ||
Cut-off Date LTV Ratio | 30.3% | Insurance | $0 | $0 | ||
Maturity Date LTV Ratio | 30.3% | Replacement Reserve | $0 | $20,970 | ||
DSCR Based on Underwritten NOI / NCF | 5.85x / 5.42x | TI/LC | $0 | $52,425 | ||
Debt Yield Based on Underwritten NOI / NCF | 19.5% / 18.1% | Other | $0 | $0 |
Sources and Uses | |||||||
Sources | $ | % | Uses | $ | % | ||
Loan Amount | $100,000,000 | 99.8 | % | Loan Payoff | $95,925,089 | 95.7 | % |
Other Sources | 225,000 | 0.2 | Reserves | 2,686,535 | 2.7 | ||
Closing Costs | 1,112,039 | 1.1 | |||||
Principal Equity Distribution | 501,338 | 0.5 | |||||
Total Sources | $100,225,000 | 100.0 | % | Total Uses | $100,225,000 | 100.0 | % |
(1) | In the event the 135 South LaSalle Loan is not paid in full on or before the due date in May 2025, the 135 South LaSalle Loan will accrue interest through the due date in May 2030 at a rate per annum equal to the greater of (i) 6.2950% and (ii) the treasury rate plus 4.0%. See “—The Mortgage Loan” below. |
(2) | The 135 South LaSalle Loan has an anticipated repayment date of May 6, 2025 and a maturity date of May 6, 2030. See “—The Mortgage Loan” below. |
n | The Mortgage Loan. The mortgage loan (the “135 South LaSalle Loan”) is evidenced by a note in the original principal amount of $100,000,000 and is secured by a first mortgage encumbering the borrower’s fee simple interest in an office building located in Chicago, Illinois (the“135 South LaSalle Property”). The 135 South LaSalle Loan was originated by Citigroup Global Markets Realty Corp. on May 1, 2015 and represents approximately 13.8% of the Initial Pool Balance. The note evidencing the 135 South LaSalle Loan has an outstanding principal balance as of the Cut-off Date of $100,000,000 and accrues interest at an initial interest rate of 3.2950%per annum (the “Initial Interest Rate”). The proceeds of the 135 South LaSalle Loan were used to refinance existing debt on the 135 South LaSalle Property, fund reserves, pay origination costs and return equity to the borrower sponsors. |
The 135 South LaSalle Loan had an initial term of 120 months and a remaining term of 118 months as of the Cut-off Date. The 135 South LaSalle Loan requires interest only payments at the Initial Interest Rate for the first 120 months through the due date occurring in May 2025 (the “ARD”). The final maturity date of the 135 South LaSalle Loan is the due date in May 2030. In the event the 135 South LaSalle Loan is not paid in full on or before the ARD, a 135 South LaSalle Trigger Event will occur and the 135 South LaSalle Loan will accrue interest through the final maturity date at a rate per annum equal to the greater of (i) 6.2950% and (ii) the treasury rate plus 4.0% (the “Adjusted Interest Rate”). If the 135 South LaSalle Loan is not paid in full on or before the ARD, then on each monthly due date (commencing with the ARD) the borrower is required to pay debt service on the 135 South LaSalle Loan at the Initial Interest Rate (while the 135 South LaSalle Loan accrues interest at the Adjusted Interest Rate) and all available excess cash flow from the 135 South LaSalle Property is required to be first applied to fully amortize the 135 South LaSalle Loan and after the 135 South LaSalle Loan has been fully amortized, it is required to be applied to any accrued but unpaid interest on the 135 South LaSalle Loan. Provided no event of default under the 135 South LaSalle Loan is continuing, defeasance with direct, non-callable obligations of the United States of America is permitted at any time on or after the first due date following the second anniversary of the securitization Closing Date. Voluntary prepayment of the 135 South LaSalle Loan, without prepayment premium or yield maintenance charge, is permitted on or after the due date in January 2025.
B-31 |
135 SOUTH LASALLE |
n | The Mortgaged Property. The 135 South LaSalle Property is a 44-story (plus three below-ground levels), Class A, multi-tenant, high-rise office building containing 1,310,047 SF of net rentable area located in downtown Chicago, Illinois. The 135 South LaSalle Property was constructed in 1934 on a 1.4-acre site and underwent renovations in 2013-2014. The 135 South LaSalle Property covers one-half of a city block and is located at the northeast corner of LaSalle and West Adams Street in the Chicago central business district. It was formerly the headquarters of LaSalle Bank which was acquired by Bank of America in 2007. Pedestrian ingress and egress to the 135 LaSalle Property is available via LaSalle, Adams and Clark Streets. A total of 48 elevators provide access to the upper floors with four escalators and one dumbwaiter providing access from the below-grade levels to the main lobby. |
The 135 South LaSalle Property also includes 24,050 SF of ground floor retail space and 51,754 SF of storage space. The 135 South LaSalle Property features art deco architecture and was awarded landmark status by the City of Chicago in 1994. The 135 South LaSalle Property’s art deco design features a grand, block-long lobby with cream-colored mosaic terrazzo floors and nickel silver accents, walls with fluted pilasters of cream-white marble and recessed panels of beige Italian marble. Many of the upper-floor tenant corridors are lined with green mosaic terrazzo and shoulder-high wainscoting in white-gray marble. As of March 31, 2015, the 135 South LaSalle Property is 95.7% leased to over 70 tenants and has experienced annual average occupancy of 90% since 2009.
The following table presents certain information relating to the major tenants at the 135 South LaSalle Property:
Tenant Name | Tenant Description | Renewal/Extension | ||
Bank of America | Bank of America is an American multinational banking and financial services corporation headquartered in Charlotte, North Carolina. It is the second largest bank holding company in the United States by assets. As of 2013, Bank of America is the twenty-first largest company in United States by total revenue. | 5, 5-year options | ||
O’Connell Tivin Miller Burns | O’Connell Tivin Miller Burns provides legal representation in both personal injury and toxic tort matters and provides comprehensive legal services to both regional and national clients. The major emphasis of the firm’s practice is in the areas of toxic tort and insurance defense litigation. The firm’s attorneys have successfully tried civil cases in state and/or federal courts in California, Delaware, Florida, Georgia, Hawaii, Illinois, Indiana, Maryland, Michigan, New York, North Dakota, Ohio, Oklahoma, Pennsylvania, Tennessee, Texas, West Virginia, Wisconsin and Virginia. | 1, 5-year option | ||
AmTrust North America | AmTrust North America specializes in writing workers’ compensation insurance and commercial package coverage for small to mid-sized businesses. AmTrust North America is rated “A” (Excellent), Financial Size XIII rating from A.M. Best and publicly traded on the NASDAQ Global Market under the symbol AFSI. | 1, 5-year option | ||
FiServ Investment Solutions | FiServ Investment Solutions is part of FiServ, Inc. which is a global provider of financial services technology. FiServ Inc., the parent company, is listed on the NASDAQ under the ticker “FISV.” | 1, 5-year option | ||
Baugh, Dalton, Carlson & Ryan | Baugh, Dalton, Carlson & Ryan is a law firm that specializes in insurance litigation. Practice areas include directors and officers liability, professional liability defense for securities brokers and dealers, lawyers, accountants, insurance agents/brokers and other professionals as well as employment practices liability, surety matters and subrogation, construction liability and major coverage disputes. | 1, 5-year option |
B-32 |
135 SOUTH LASALLE |
The following table presents certain information relating to the major tenants at the135 South LaSalle Property:
Ten Largest Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating | Tenant | % of GLA | UW Base Rent | % of Total | UW Base | Lease | Renewal / Extension | |||||||||||
Bank of America(2) | A/ Baa2/A- | 826,962 | 63.1 | % | $14,978,756 | 56.3 | % | $18.11 | 7/31/2020 | 5, 5-year options | |||||||||
O’Connell Tivin Miller Burns | NR/NR/NR | 32,028 | 2.4 | 951,698 | 3.6 | 29.71 | 10/31/2024 | 1, 5-year option | |||||||||||
AmTrust North America | NR/NR/NR | 26,849 | 2.0 | 789,705 | 3.0 | 29.41 | 11/30/2022 | 1, 5-year option | |||||||||||
FiServ Investment Solutions(3) | NR/Baa2/BBB | 14,651 | 1.1 | 456,405 | 1.7 | 31.15 | 2/29/2020 | 1, 5-year option | |||||||||||
Gaiatech, Inc.(4) | NR/NR/NR | 13,038 | 1.0 | 397,659 | 1.5 | 30.50 | 8/31/2020 | 2, 5-year options | |||||||||||
Baugh, Dalton, Carlson & Ryan(5) | NR/NR/NR | 13,265 | 1.0 | 379,785 | 1.4 | 28.63 | 8/19/2024 | 1, 5-year option | |||||||||||
Frontenac Company, LLC | NR/NR/NR | 13,419 | 1.0 | 379,404 | 1.4 | 28.27 | 4/30/2016 | NA | |||||||||||
Edward T. Joyce & Associates | NR/NR/NR | 11,814 | 0.9 | 372,141 | 1.4 | 31.50 | 2/28/2023 | 1, 5-year option | |||||||||||
Davis Friedman, LLP | NR/NR/NR | 12,275 | 0.9 | 368,250 | 1.4 | 30.00 | 8/31/2015 | 2, 5-year options | |||||||||||
Verisight, Inc. | NR/NR/NR | 12,069 | 0.9 |
| 364,739 | 1.4 |
| 30.22 | 10/31/2016 | NA | |||||||||
Ten Largest Tenants | 976,370 | 74.5 | % | $19,438,541 | 73.1 | % | $19.91 | ||||||||||||
Remaining Tenants | 277,166 | 21.2 | 7,156,983 | 26.9 | 25.82 | ||||||||||||||
Vacant | 56,511 | 4.3 |
| 0 | 0.0 |
| 0.00 | ||||||||||||
Total / Wtd. Avg. All Tenants | 1,310,047 | 100.0 | % | $26,595,524 | 100.0 | % | $21.22 |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | Bank of America occupies its space under a triple net lease. Bank of America has the right to reduce its total space by 43,000 SF, specifically with regards to floors 15-18, on the first day of lease years 8, 9, 10 and 11 with the payment of a termination fee. |
(3) | FiServ Investment Solutions has a one-time right to terminate its lease on February 28, 2018 with a one-year notice period and a termination fee of $280,698. |
(4) | Gaiatech, Inc. has a one-time right to terminate its lease on August 31, 2017 with a one-year notice period and payment of any unamortized tenant improvements, leasing commissions and concessions. |
(5) | Baugh, Dalton, Carlson & Ryan has a one-time right to terminate its lease on August 19, 2019 with a one-year notice period and payment of any unamortized tenant improvements, leasing commissions and concessions. |
The following table presents the lease rollover schedule at the 135 South LaSalle Property, based on initial lease expiration dates: |
Lease Expiration Schedule(1)(2)
Year Ending | Expiring Owned | % of Owned | Cumulative % of | UW | % of Total UW | UW Base Rent | # of Expiring | ||||||||||||||
MTM | 0 | 0.0 | % | 0.0% | $0 | 0.0 | % | $0.00 | 0 | ||||||||||||
2015 | 32,311 | 2.5 | 2.5% | 668,992 | 2.5 | 20.70 | 10 | ||||||||||||||
2016 | 52,518 | 4.0 | 6.5% | 1,408,423 | 5.3 | 26.82 | 13 | ||||||||||||||
2017 | 47,576 | 3.6 | 10.1% | 906,619 | 3.4 | 19.06 | 12 | ||||||||||||||
2018 | 23,778 | 1.8 | 11.9% | 728,756 | 2.7 | 30.65 | 6 | ||||||||||||||
2019 | 60,997 | 4.7 | 16.6% | 1,796,196 | 6.8 | 29.45 | 19 | ||||||||||||||
2020 | 891,666 | 68.1 | 84.6% | 16,617,640 | 62.5 | 18.64 | 42 | ||||||||||||||
2021 | 41,968 | 3.2 | 87.8% | 1,173,880 | 4.4 | 27.97 | 8 | ||||||||||||||
2022 | 25,156 | 1.9 | 89.8% | 723,125 | 2.7 | 28.75 | 3 | ||||||||||||||
2023 | 26,280 | 2.0 | 91.8% | 1,066,495 | 4.0 | 40.58 | 2 | ||||||||||||||
2024 | 48,329 | 3.7 | 95.5% | 1,424,081 | 5.4 | 29.47 | 8 | ||||||||||||||
2025 | 0 | 0.0 | 95.5% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2026 & Thereafter | 2,957 | 0.2 | 95.7% | 81,318 | 0.3 | 27.50 | 1 | ||||||||||||||
Vacant | 56,511 |
| 4.3 |
| 100.0% | 0 |
| 0.0 |
| 0.00 |
| 0 |
| ||||||||
Total / Wtd. Avg. | 1,310,047 | 100.0 | % | $26,595,524 | 100.0 | % | $21.22 | 124 |
(1) | Calculated based on approximate square footage occupied by each Owned Tenant. |
(2) | Certain tenants have lease termination options that are exercisable prior to the originally stated expiration date of the applicable lease and which are not reflected in the Lease Expiration Schedule. |
(3) | Several tenants occupy multiple spaces within the 135 South LaSalle Property and portions of each such tenants’ spaces have lease expirations at different dates. As such, each space is treated as a separate tenant in the table above. |
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135 SOUTH LASALLE |
The following table presents certain information relating to historical leasing at the 135 South LaSalle Property:
Historical Leased %(1)
| 2010 | 2011 | 2012 | 2013 | 2014 | As of 3/31/2015 | ||||||
Owned Space | 84.5% | 86.0% | 87.4% | 91.7% | 92.3% | 95.7% |
(1) | As provided by the borrower and which represents average occupancy for the specified year unless otherwise indicated. |
The following table presents certain information relating to the historical average annual rent per SF at the 135 South LaSalle Property:
Historical Average Base Rent per SF(1)
| 2012 | 2013 | 2014 | As of | ||||
Base Rent per SF | $17.53 | $17.98 | $18.86 | $21.22 |
(1) | Base Rent per SF calculation is based on borrower-provided rental figures and total occupied square footage of 1,145,374 (2012), 1,201,051 (2013), 1,209,173 (2014) and 1,253,536 (as of March 31, 2015). |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the 135 South LaSalle Property: |
Cash Flow Analysis(1)
| 2012 | 2013 | 2014 | TTM 2/28/2015 | Underwritten | Underwritten | ||||||||||
Base Rent(2) | $20,081,794 | $21,598,402 | $22,806,359 | $22,805,996 | $24,876,793 | $18.99 | ||||||||||
Contractual Rent Steps(3) | 0 | 0 | 0 | 0 | 1,718,731 | 1.31 | ||||||||||
Gross Up Vacancy | 0 | 0 | 0 |
| 0 |
| 1,701,182 |
| 1.30 |
| ||||||
Total Rent | $20,081,794 | $21,598,402 | $22,806,359 | $22,805,996 | $28,296,706 | $21.60 | ||||||||||
Total Reimbursables | 10,742,366 | 11,307,414 | 12,261,014 | 11,844,817 | 11,837,480 | 9.04 | ||||||||||
Other Income(4) | 1,480,726 | 1,469,535 | 1,332,166 | 1,348,893 | 1,348,893 | 1.03 | ||||||||||
Percentage Rent(5) | 242,560 | 259,483 | 262,351 | 269,162 | 262,351 | 0.20 | ||||||||||
Vacancy & Credit Loss | 0 | 0 | 0 |
| 0 |
| (2,006,709 | ) | (1.53 | ) | ||||||
Effective Gross Income | $32,547,447 | $34,634,834 | $36,661,890 | $36,268,868 | $39,738,720 | $30.33 | ||||||||||
Real Estate Taxes | $7,139,189 | $7,495,511 | $7,596,950 | $7,596,950 | $7,824,858 | $5.97 | ||||||||||
Insurance | 384,178 | 402,402 | 303,399 | 302,221 | 446,689 | 0.34 | ||||||||||
Management Fee | 660,000 | 660,000 | 660,000 | 660,000 | 1,000,000 | 0.76 | ||||||||||
Other Operating Expenses | 9,546,947 | 10,351,574 | 10,909,575 |
| 11,109,457 |
| 10,937,873 |
| 8.35 |
| ||||||
Total Operating Expenses | $17,730,315 | $18,909,488 | $19,469,924 | $19,668,628 | $20,209,421 | $15.43 | ||||||||||
Net Operating Income(6) | $14,817,132 | $15,725,346 | $17,191,966 | $16,600,240 | $19,529,300 | $14.91 | ||||||||||
TI/LC | 0 | 0 | 0 | 0 | 1,156,046 | 0.88 | ||||||||||
Replacement Reserves | 0 | 0 | 0 |
| 0 |
| 262,009 |
| 0.20 |
| ||||||
Net Cash Flow | $14,817,132 | $15,725,346 | $17,191,966 | $16,600,240 | $18,111,245 | $13.82 |
(1) | Certain items such as straight line rent, interest expense, interest income, lease cancellation income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. |
(2) | The Underwritten Base Rent is based on contractual rents for tenants at the 135 South LaSalle Property. The increase of approximately $2.07 million in Base Rent from TTM 2/28/2015 to the underwritten amount is attributable to tenant lease renewals at higher rents and new tenant leases. |
(3) | Underwritten Contractual Rent Steps includes the present value of contractual rent steps (discounted at an 8.0% rate) pursuant to the Bank of America lease and the actual scheduled rent increases through May 1, 2016 for any other tenants. |
(4) | Other income includes sub-metered electricity, sprinkler income, overtime HVAC, elevator service income and tenant service income (repairs and extra cleaning). |
(5) | Percentage Rent is paid by Books-A-Million in lieu of base rent and recoveries. Tenant sales for 2012, 2013 and 2014 were $184, $168 and $164 per SF, respectively. |
(6) | The Net Operating Income for the period beginning on January 1, 2015 and ending on February 28, 2015 was $4,800,694. |
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n | Appraisal.According to the appraisal, the 135 South LaSalle Property had an “as-is” appraised value of $330,000,000 as of March 30, 2015. |
n | Environmental Matters.Based on the Phase I environmental report dated April 10, 2015, there were no recommendations for further action for the 135 South LaSalle Property other than the continuation of an operations and maintenance plan for asbestos, which was in place at origination of the 135 South LaSalle Loan. |
n | Market Overview and Competition. The 135 South LaSalle Property is located in the Central Loop submarket of the Chicago central business district. The Central Loop is the second largest submarket in downtown Chicago, consisting of 36.1 million SF of office space. The submarket offers an optimal combination of transportation access and amenities in the city. The Central Loop has more Chicago Transit Authority stations than any other submarket, and all lines are accessible within a few blocks of the 135 South LaSalle Property. The 135 South LaSalle Property is easily accessible from the three major arteries that serve downtown Chicago: Interstates 90 / 94, Interstate 290 and US Highway 41. Additionally, the 135 South LaSalle Property is located nearby metro stations and the Chicago Transit Authority “L” stops. |
According to the appraisal, some of the top employers within the area consist of Advocate Health Care System, JPMorgan Chase & Co., University of Chicago, Walgreen Co. and AT&T. According to the appraisal, the estimated population for 2015 within a 0.5-, 1- and 2-mile radius is 14,380, 63,249 and 203,149, respectively. The 2015 estimated average household income within a 0.5-, 1- and 2-mile radius is $101,591, $113,311 and $109,469, respectively. According to a third-party report, the Central Loop submarket is comprised of 23.3 million SF of Class A office space within 27 buildings with a 10.9% vacancy rate and asking rent of $32.04 per SF.
Based on recent lease comparables, the appraiser concluded to an average rental rate of $31.00 per SF for the office space on floors 1-30, $33.00 per SF for floors 31-44, $45.00 per SF for ground floor retail and $16.00 per SF for storage.
The following table presents certain information relating to certain office lease comparables provided in the appraisal for the 135 South LaSalle Property:
Office Lease Comparables(1)
| 135 South LaSalle | 120 South | Burnham | LaSalle-Wacker | Bank of America Center | Chicago Board of Trade | ||||||
Year Built | 1934 | 1928 | 1914 | 1930 | 1924 | 1930 | ||||||
Total GLA | 1,310,047 | 650,279 | 579,778 | 360,594 | 994,761 | 1,365,182 | ||||||
Total Occupancy | 95.7% | 78% | 93% | 84% | 90% | 66% | ||||||
Base Rent | $21.22 | $25.00 – $29.00 | $24.50 – $27.85 | $23.00 – $32.00 | $21.25 - $30.00 | $25.00 - $32.50 |
(1) | Source: Appraisal. |
n | The Borrower. The borrower of the 135 South LaSalle Loan is 135 S LaSalle Property, LLC, a single-purpose, single-asset Delaware limited liability company. Legal counsel to the borrower delivered a non-consolidation opinion in connection with the origination of the 135 South LaSalle Loan. The borrower sponsors and non-recourse carveout guarantors for the 135 South LaSalle Loan are Michael Karfunkel 2005 GRAT and George Karfunkel. It is anticipated that the Michael Karfunkel 2005 GRAT will make its final annuity payment in June of 2015, at which time it is required to be replaced as a carveout guarantor by the Michael Karfunkel Family Trust. Michael and George Karfunkel founded AmTrust Realty Corp. in 1993 and it is the owner of eight million SF of commercial real estate including: 59 Maiden Lane and 250 Broadway in downtown Manhattan; 303 South Broadway in Tarrytown, NY; AXA Towers in Syracuse, NY; the 135 South LaSalle Property, 33 West Monroe and 1 East Wacker Drive in Chicago; and Fifth Third Center in Toledo, Ohio. |
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n | Escrows. On the origination date, the borrower funded a reserve of $2,686,535 for real estate taxes. |
On each due date, the borrower is required to pay to the lender (i) one-twelfth of the taxes that the lender estimates will be payable during the next ensuing 12 months, (ii) at the option of the lender, if the liability or casualty policy maintained by the borrower does not constitute an approved blanket or umbrella insurance policy under the 135 South LaSalle Loan documents, an insurance reserve in an amount equal to one-twelfth of the amount that the lender estimates will be necessary to pay insurance premiums over the then succeeding 12-month period, (iii) a tenant improvements and leasing commissions reserve in the amount of $52,425 and (iv) a replacement reserve in the amount of $20,970.
n | Lockbox and Cash Management. The 135 South LaSalle Loan documents require a springing lockbox with springing cash management. Upon the occurrence of a 135 South LaSalle Trigger Event, the 135 South LaSalle Loan documents require the borrower to direct tenants to pay rent directly to a lender-controlled lockbox account and require that all other money received by the borrower with respect to the 135 South LaSalle Property be deposited into such lockbox account immediately following receipt. On each business day that no 135 South LaSalle Trigger Period is continuing, all amounts in the lockbox account are required to be swept to an operating account of the borrower. During the continuance of a 135 South LaSalle Trigger Period, all amounts in the lockbox account are required to be swept to a lender-controlled cash management account on a daily basis and, provided no event of default under the 135 South LaSalle Loan documents is continuing, applied to payment of applicable debt service, payment of operating expenses and funding of required reserves, with the remainder being deposited into an excess cash flow reserve. Funds in the excess cash flow reserve are (i) to the extent no 135 South LaSalle Trigger Period is continuing and provided that the excess cash flow funds are not required to be held as collateral to satisfy the Excess Cash Flow Threshold (as defined below) in order to cure a 135 South LaSalle Specified Tenant Trigger Period, to be swept into the borrower’s operating account, (ii) to the extent a 135 South LaSalle Trigger Period is continuing, to be held by the lender as additional collateral for the 135 South LaSalle Loan (provided that, so long as (a) no event of default is continuing, (b) the ARD has not occurred and (c) the excess cash flow funds are not required to be held as collateral to satisfy the Excess Cash Flow Threshold (as defined below) in order to cure a 135 South LaSalle Specified Tenant Trigger Period, funds in the excess cash flow reserve may be disbursed for tenant improvements and leasing commissions costs to the extent there are not sufficient funds on reserve in the tenant improvements and leasing commissions escrow) and (iii) to the extent that the 135 South LaSalle Loan has not been paid in full as of the ARD and no event of default is continuing, on each monthly due date commencing with the ARD, to be applied by the lender in the following order of priority: (i) first, to the reduction of the principal balance of the 135 South LaSalle Loan until the principal balance of the 135 South LaSalle Loan (excluding any accrued interest) is zero and (ii) second, to the payment of any accrued interest until the outstanding amount of accrued interest is zero (see “—The Mortgage Loan” above for a description of the 135 South LaSalle Loan’s ARD component). During the continuance of an event of default under the 135 South LaSalle Loan documents, the lender may apply any funds in the cash management account to amounts payable under the 135 South LaSalle Loan (and/or toward the payment of expenses of the 135 South LaSalle Property), in such order of priority as the lender may determine. |
A “135 South LaSalle Trigger Period” means a period (i) commencing upon the occurrence of an event of default under the 135 South LaSalle Loan documents and continuing until the same is cured, (ii) commencing on the date that the debt service coverage ratio is less than 1.30x and continuing until the debt service coverage ratio is equal to or greater than 1.35x for one calendar quarter, (iii) commencing upon the occurrence of a 135 South LaSalle Specified Tenant Trigger Period, and continuing until the same is cured and (iv) commencing on the ARD.
A “135 South LaSalle Specified Tenant” means (i) Bank of America and (ii) any of the other lessee(s) of the space demised to Bank of America (or any portion thereof) and any guarantor of the applicable related specified tenant lease, provided that with respect to a replacement lease, such replacement 135 South LaSalle Specified Tenant thereunder, when aggregated with all other leases at the 135 South LaSalle Property with the same tenant or as affiliate thereof, either (A) accounts for at least 15% of the gross rents or (B) occupies 15% of the square footage of the 135 South LaSalle Property.
A “135 South LaSalleSpecified Tenant Trigger Period” means a period: (A) commencing upon the first to occur of (i) a 135 South LaSalle Specified Tenant being in monetary default under its lease, (ii) a 135 South LaSalle Specified Tenant giving notice that it is terminating all or any portion of its lease, (iii) any termination, cancellation or failure to be in full force and effect of any 135 South LaSalle Specified Tenant lease, (iv) any bankruptcy or similar insolvency of any 135 South LaSalle Specified Tenant and (v) a 135 South LaSalle
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Specified Tenant failing to extend or renew its lease on or prior to the applicable notice deadline for a minimum period of five years; and (B) expiring upon the first to occur of the lender’s receipt of reasonably acceptable evidence of (1) the satisfaction of the 135 South LaSalle Specified Tenant Cure Conditions or (2) the borrower re-leasing the entire space that was demised pursuant to the 135 South LaSalle Specified Tenant’s lease to a new tenant (or series of new tenants), and the applicable 135 South LaSalle Specified Tenant (or series of tenants) under such lease being in actual, physical occupancy of the space demised under its lease and paying the full amount of the rent due. Notwithstanding the foregoing, no 135 South LaSalle Specified Tenant Trigger Period will be deemed to be ongoing during any period that the debt yield of the 135 South LaSalle Loan equals or exceeds 10% or the amount on deposit in the excess cash flow account equals or exceeds the Excess Cash Flow Threshold.
“135 South LaSalle Specified Tenant Cure Conditions” means each of the following, as applicable: (i) the applicable 135 South LaSalle Specified Tenant has cured all defaults under the related lease; (ii) the applicable 135 South LaSalle Specified Tenant is in possession of its premises; (iii) the applicable 135 South LaSalle Specified Tenant has revoked or rescinded any termination or cancellation notices previously delivered and has re-affirmed its lease; (iv) the applicable 135 South LaSalle Specified Tenant has renewed or extended its lease for a minimum term of at least 5 years; (v) with respect to any applicable bankruptcy or insolvency proceedings, the applicable 135 South LaSalle Specified Tenant has affirmed its lease pursuant to a final, non-appealable order of a court of competent jurisdiction; and (vi) the applicable 135 South LaSalle Specified Tenant is paying full, unabated rent under its lease.
“Excess Cash Flow Threshold” means an amount equal to the product of $65 and the number of SF demised to the applicable 135 South LaSalle Specified Tenant; provided, however, if the applicable 135 South LaSalle Specified Tenant Trigger Period was caused by a partial termination of a lease with a 135 South LaSalle Specified Tenant or a failure to renew a portion of the applicable lease, the Excess Cash Flow Threshold will be prorated to equal the product of $65 and the number of SF being terminated or not renewed with respect to the applicable 135 South LaSalle Specified Tenant’s lease.
n | Property Management.The 135 South LaSalle Property is currently managed by AmTrust Realty Corp., an affiliate of the borrower. Under the 135 South LaSalle Loan, the 135 South LaSalle Property may not be managed by any party other than AmTrust Realty Corp.; provided, however, if no event of default under the 135 South LaSalle Loan exists, the borrower can replace AmTrust Realty Corp. with a property manager that is reasonably approved by the lender in writing and, if such property manager is an affiliate of the borrower, a new non-consolidation opinion is provided from the borrower’s counsel. The lender has the right to terminate the management agreement and replace the property manager or require that the borrower terminate the management agreement and replace the property manager if (a) the property manager becomes a debtor in (i) any involuntary bankruptcy or insolvency proceeding that is not dismissed within 90 days of the filing thereof or (ii) any voluntary bankruptcy or insolvency proceeding, (b) there exists a 135 South LaSalle Trigger Period, (c) the property manager has engaged in gross negligence, fraud, willful misconduct or misappropriation of funds or (d) there exists a default by the property manager beyond all applicable notice and cure periods under the management agreement. |
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n | Mezzanine or Subordinate Indebtedness. Not permitted. |
n | Terrorism Insurance. The borrower is required to maintain an “all-risk” insurance policy, without exclusion for acts of terrorism, in an amount equal to the full replacement cost of the 135 South LaSalle Property and business interruption coverage with no exclusion for terrorism that provides 18 months of business interruption coverage with an additional 6-month extended period of indemnity or until the income is restored to its prior level (whichever occurs first). The “all-risk” policy containing terrorism insurance is required to contain a deductible that is no higher than $25,000. See “Risk Factors—Terrorism Insurance May Not Be Available for All Mortgaged Properties” in the Prospectus Supplement. |
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Mortgaged Property Information | Mortgage Loan Information | |||||
Number of Mortgaged Properties | 9 | Loan Seller | GSMC | |||
Location (City/State) | Seattle, Washington | Cut-off Date Principal Balance(4) | $72,000,000 | |||
Property Type | Office | Cut-off Date Principal Balance per SF(2) | $211.47 | |||
Size (SF) | 1,631,457 | Percentage of Initial Pool Balance | 9.95% | |||
Total Occupancy as of 2/23/2015(1) | 92.4% | Number of Related Mortgage Loans | None | |||
Owned Occupancy as of 2/23/2015(1) | 92.4% | Type of Security | Fee Simple | |||
Year Built / Latest Renovation | Various / NAP | Mortgage Rate | 3.9085% | |||
Appraised Value | $544,500,000 | Original Term to Maturity (Months) | 120 | |||
Original Amortization Term (Months) | NAP | |||||
Original Interest Only Period (Months) | 120 | |||||
Underwritten Revenues | $44,652,839 | |||||
Underwritten Expenses | $12,576,474 | Escrows | ||||
Underwritten Net Operating Income (NOI) | $32,076,365 | Upfront | Monthly | |||
Underwritten Net Cash Flow (NCF) | $30,307,148 | Taxes | $255,019 | $255,019 | ||
Cut-off Date LTV Ratio(2) | 63.4% | Insurance | $0 | $0 | ||
Maturity Date LTV Ratio(2)(3) | 62.3% | Replacement Reserve | $0 | $33,989 | ||
DSCR Based on Underwritten NOI / NCF(2) | 2.35x / 2.22x | TI/LC | $0 | $203,932 | ||
Debt Yield Based on Underwritten NOI / NCF(2) | 9.3% / 8.8% | Other(5) | $7,616,186 | $0 |
Sources and Uses(2) | ||||||
Sources | $ | % | Uses | $ | % | |
Loan Combination Amount | $345,000,000 | 100.0% | Loan Payoff | $307,285,721 | 89.1 | % |
Principal Equity Distribution | 27,103,125 | 7.9 | ||||
Reserves | 7,871,205 | 2.3 | ||||
Closing Costs | 2,739,949 | 0.8 | ||||
Total Sources | $345,000,000 | 100.0% | Total Uses | $345,000,000 | 100.0 | % |
(1) | Total Occupancy and Owned Occupancy include: (i) 6,715 SF of space leased by Triton Radio Networks whose lease expires in February 2016, but as of June 2015 was dark and still paying rent and (ii) 17,359 SF of space for three tenants (CKCA2 Inc., Sound View Advisors and Koru Careers, Inc.) that have executed leases but have not yet taken occupancy or begun paying rent. We cannot assure you that these tenants will take occupancy or begin paying rent as expected or at all. Total Occupancy and Owned Occupancy excluding the four tenants described in the preceding sentence are both 90.9%. Additionally, Total Occupancy and Owned Occupancy do not include 37,864 SF of space that Washington State Ferries will vacate in August 2015 pursuant to a recently executed lease renewal. |
(2) | Calculated based on the aggregate balance of the Selig Office Portfolio Loan Combination. |
(3) | The Maturity Date LTV Ratio is calculated utilizing the aggregate “as stabilized” appraised value of $553,400,000 which includes “as stabilized” appraised values for four of the Selig Office Portfolio Properties. The Maturity Date LTV Ratio calculated on the basis of the “as-is” appraised value is 63.4%. See“—Appraisals”below. |
(4) | The Cut-off Date Principal Balance of $72,000,000 represents the non-controlling note A-3 of a $345,000,000 loan combination evidenced by fourpari passu notes. The companion loans are evidenced by (i) the controlling note A-1 with a principal balance of $125,000,000 as of the Cut-off Date, which was contributed to the Citigroup Commercial Mortgage Trust 2015-GC29, Commercial Mortgage Pass-Through Certificates, Series 2015-GC29 (“CGCMT 2015-GC29”) transaction, (ii) the non-controlling note A-2 with a principal balance of $123,000,000 as of the Cut-off Date, which was contributed to the GS Mortgage Securities Trust 2015-GC30, Commercial Mortgage Pass-Through Certificates, Series 2015-GC30 (“GSMS 2015-GC30”) transaction and (iii) the non-controlling note A-4 with a principal balance of $25,000,000 as of the Cut-off Date, which is expected to be contributed to a future securitization transaction. |
(5) | Other upfront reserves represent $3,900,807 for an unexecuted lease holdback related to two negotiated leases that are now signed but were out for signature at the time of loan origination (which holdback has since been released), $3,377,855 for unfunded obligations (primarily related to tenant improvements and unfunded free rent at the Selig Office Portfolio Properties) and a $337,524 deferred maintenance and environmental escrow reserve (primarily related to $200,000 for remediation of potential soil and groundwater issues at the 2615 Fourth Avenue Property, and various other items at the Selig Office Portfolio Properties, none greater than $20,000). See“—Escrows”below. |
n | The Mortgage Loan. The mortgage loan (the “Selig Office Portfolio Loan”) is part of a loan combination (the “Selig Office Portfolio Loan Combination”) evidenced by fourpari passu notes that are together secured by first mortgages encumbering the borrower’s fee simple interest in nine office buildings located in Seattle, Washington (collectively, the “Selig Office Portfolio Properties”). The Selig Office Portfolio Loan (evidenced by note A-3), which represents a non-controlling interest in the Selig Office Portfolio Loan Combination, will be contributed to the Issuing Entity, has an outstanding principal balance as of the Cut-off Date of $72,000,000 and represents approximately 9.95% of the Initial Pool Balance. The related companion loans (collectively, the “Selig Office Portfolio Companion Loan”) are evidenced by (i) note A-1, which represents the controlling interest in the Selig Office Portfolio Loan Combination and was contributed to the CGCMT 2015-GC29 transaction, (ii) note A-2, which represents a non-controlling interest in the Selig Office Portfolio Loan Combination and was contributed to the GSMS 2015-GC30 transaction, and (iii) note A-4, which represents a non-controlling interest in the Selig Office Portfolio Loan Combination and is currently held by Goldman Sachs Mortgage Company outside the Issuing Entity. The Selig Office Portfolio Companion Loan has an aggregate outstanding principal balance as of the Cut-off Date of $273,000,000. The Selig Office Portfolio Loan Combination was originated by Goldman Sachs Mortgage Company on March 19, 2015 and has an original principal balance of $345,000,000. Each note has an interest rate of 3.9085%per annum. The borrower utilized the proceeds of the Selig Office Portfolio Loan Combination to refinance the existing debt on the Selig Office Portfolio Properties, return equity to the borrower sponsors, fund reserves and pay origination costs. |
The Selig Office Portfolio Loan had an initial term of 120 months and has a remaining term of 117 months as of the Cut-off Date. The Selig Office Portfolio Loan requires payments of interest only during its term. The scheduled maturity date of the Selig Office Portfolio Loan is the due date in April 2025. The Selig Office Portfolio Loan may be voluntarily prepaid in whole or in part on or after the due date in January 2025 without payment of any prepayment premium or yield maintenance premium. Provided that no event of default under the Selig Office Portfolio Loan is continuing, defeasance with direct, non-callable obligations of the United States of America is
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permitted at any time on or after the first due date following the earlier of (a) the third anniversary of the origination date of the Selig Office Portfolio Loan and (b) the second anniversary of the closing date of the securitization into which the last Selig Office Portfolio Companion Loan is deposited.
n | The Mortgaged Properties.The Selig Office Portfolio Properties consist of five Class A and four Class B office buildings located in Seattle, Washington that were constructed between 1971 and 1986. The collateral securing the Selig Office Portfolio Loan Combination totals approximately 1,631,457 SF and the largest tenants include Holland America (11.0% of GLA, 9.9% of UW Base Rent), Washington State Ferries (5.3% of GLA, 5.6% of UW Base Rent), Emeritus Corporation (4.7% of GLA, 5.2% of UW Base Rent), Cell Therapeutics (4.0% of GLA, 5.0% of UW Base Rent) and Cisco Systems (4.1% of GLA, 4.8% of UW Base Rent). As of February 23, 2015, Total Occupancy and Owned Occupancy for the Selig Office Portfolio Properties were both 92.4%. |
The following table presents certain information relating to the Selig Office Portfolio Properties:
Property Name | City | State | Cut-off Date | Total GLA | Occupancy(1)(2) | Property Class | Year Built / Renovated | Appraised Value(1) | UW NCF(1) | |||||||||||||
1000 Second Avenue | Seattle | WA | $25,388,430 | 447,792 | 97.8% | Class A | 1986 / NAP | $192,000,000 | $10,106,504 | |||||||||||||
2901 Third Avenue | Seattle | WA | 10,842,975 | 269,862 | 76.7% | Class A | 1982 / NAP | 82,000,000 | 4,058,884 | |||||||||||||
3101 Western Avenue | Seattle | WA | 9,123,967 | 187,035 | 96.1% | Class A | 1984 / NAP | 69,000,000 | 4,167,663 | |||||||||||||
300 Elliott Avenue West | Seattle | WA | 8,000,000 | 226,159 | 99.7% | Class B | 1981 / NAP | 60,500,000 | 3,790,919 | |||||||||||||
3131 Elliott Avenue | Seattle | WA | 7,867,769 | 189,849 | 91.3% | Class A | 1986 / NAP | 59,500,000 | 3,463,718 | |||||||||||||
2615 Fourth Avenue | Seattle | WA | 4,733,884 | 124,276 | 89.4% | Class A | 1974 / NAP | 35,800,000 | 2,097,270 | |||||||||||||
190 Queen Anne Avenue North | Seattle | WA | 2,790,083 | 84,582 | 98.1% | Class B | 1974 / NAP | 21,100,000 | 1,209,573 | |||||||||||||
200 First Avenue West | Seattle | WA | 2,115,702 | 66,470 | 85.2% | Class B | 1971 / NAP | 16,000,000 | 852,940 | |||||||||||||
18 West Mercer Street | Seattle | WA | 1,137,190 | 35,432 | 94.6% | Class B | 1984 / NAP | 8,600,000 | 559,677 | |||||||||||||
Total / Wtd. Avg. | $72,000,000 |
| 1,631,457 |
| 92.4% | $544,500,000 |
| $30,307,148 |
|
(1) | Based on the Selig Office Portfolio Loan Combination. |
(2) | Occupancy as of February 23, 2015. Occupancy does not include 37,864 SF of space that Washington State Ferries will vacate in August 2015 pursuant to a recently executed lease renewal. |
The following table presents certain information relating to the major tenants at theSelig Office Portfolio Properties:
Tenant Name | Tenant Description | Renewal / Extension Options | ||
Holland America | Holland America is widely recognized as a leader in the premium segment of the cruise industry. The company’s fleet of 15 ships annually offers more than 500 cruises to 415 ports of call in 98 countries, territories or dependencies. In 1989, Holland America Line Inc. became a wholly owned subsidiary of Carnival Corp (NYSE: CCL), the largest cruise company in the world. | 1, 5-year option | ||
Washington State Ferries | Washington State Ferries operates the largest ferry system in the United States. Twenty-two (22) ferries cross Puget Sound and its inland waterways, carrying more than 22 million passengers to 20 different ports of call. From Tacoma, Washington, to Sidney, British Columbia, the ferries travel up and down the Sound, acting as a marine highway for commercial users, tourists and daily commuters alike. | NA | ||
Emeritus Corporation | Emeritus Corporation is the nation’s largest assisted living and memory care provider, with the ability to serve nearly 54,000 residents. Over 31,000 employees support more than 500 communities throughout 45 states coast to coast. In July 2014, Emeritus Corporation merged with Brookdale Senior Living Inc., the leading operator of senior living communities throughout the United States. | 2, 5-year options | ||
Cell Therapeutics | Cell Therapeutics is a biopharmaceutical company whose mission is to acquire, develop and bring to market less toxic, more effective ways to treat and cure cancer. The company has a commercial product, PIXUVRI®, available in certain markets in Europe, as well as a diverse late-stage development pipeline that it believes will drive future growth of the company. The company is headquartered in Seattle, Washington, with offices in London and Milan. | 2, 5-year options | ||
Cisco Systems | Cisco System, Inc. (NASDAQ:CSCO), incorporated in 1984, designs, manufactures, and sells Internet protocol (IP)-based networking products and services related to the communications and information technology (IT) industry. The company’s customers include businesses of all sizes, public institutions, telecommunication companies, other service providers and individuals. | 2, 3-year options |
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The following table presents certain information relating to the major tenants at theSelig Office Portfolio Properties:
Ten Largest Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating | Tenant | % of | UW Base Rent | % of Total | UW Base | Lease Expiration | Renewal / | |||||||||||||
Holland America(2)(3) | NR / Baa1 / BBB+ | 179,042 | 11.0 | % | $3,845,112 | 9.9 | % | $21.48 | 12/31/2016 | 1, 5-year option | |||||||||||
Washington State Ferries(4) | NR / NR / NR | 86,510 | 5.3 | 2,162,750 | 5.6 | 25.00 | 8/31/2020 | NA | |||||||||||||
Emeritus Corporation(5) | NR / NR / NR | 76,690 | 4.7 | 2,009,635 | 5.2 | 26.20 | 9/30/2025 | 2, 5-year options | |||||||||||||
Cell Therapeutics(6) | NR / NR / NR | 66,045 | 4.0 | 1,948,328 | 5.0 | 29.50 | 4/30/2022 | 2, 5-year options | |||||||||||||
Cisco Systems(7) | NR / A1 / AA- | 66,363 | 4.1 | 1,850,868 | 4.8 | 27.89 | 7/10/2019 | 2, 3-year options | |||||||||||||
Immigration and Customs Enforcement | AAA / Aaa / AA+ | 51,235 | 3.1 | 1,748,124 | 4.5 | 34.12 | 3/31/2017 | 1, 5-year option | |||||||||||||
Customs & Border Protection | AAA / Aaa / AA+ | 48,220 | 3.0 | 1,633,824 | 4.2 | 33.88 | 3/31/2017 | 1, 5-year option | |||||||||||||
DDB Seattle(8) | NR / Baa1 / BBB+ | 54,369 | 3.3 | 1,449,900 | 3.7 | 26.67 | 3/31/2023 | 2, 5-year options | |||||||||||||
Seattle Housing Authority | NR/ NR / NR | 67,601 | 4.1 | 1,354,548 | 3.5 | 20.04 | 3/25/2023 | 2, 5-year options | |||||||||||||
Ben Bridge | A+ / Aa2 / AA | 41,686 | 2.6 | 1,008,094 | 2.6 | 24.18 | 8/23/2022 | 2, 5- or 10-year options | |||||||||||||
Ten Largest Tenants | 737,761 | 45.2 | % | $19,011,183 | 48.8 | % | $25.77 | ||||||||||||||
Remaining Tenants | 769,857 | 47.2 | 19,909,237 | 51.2 | 25.86 | ||||||||||||||||
Vacant | 123,839 | 7.6 | 0 | 0.0 | 0.00 | ||||||||||||||||
Total / Wtd. Avg. All Tenants | 1,631,457 | 100.0 | % | $38,920,420 | 100.0 | % | $25.82 |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | Holland America is expected to vacate all of its space at the end of its lease term in December 2016. The Selig Office Portfolio Loan is structured with a springing $170,000 monthly reserve commencing 18 months prior to this lease expiration and continuing until $3.0 million is reserved for the purpose of covering any costs associated with re-leasing this space. |
(3) | Holland America has the right to contract its space by up to 10% per year on a noncumulative basis. However, the premises may not be reduced below 71,300 SF. |
(4) | As of the Cut-off Date, Washington State Ferries is expected to occupy 124,374 SF at the 2901 Third Avenue Property. On March 11, 2015, the tenant signed a 5-year lease extension for 86,510 SF of this space, and is expected to vacate the remaining 37,864 SF in August 2015. The new lease terms are reflected in the underwriting; however, Washington State Ferries will continue to pay rent on the full 124,374 SF through August 2015. |
(5) | Emeritus Corporation subleases 7,969 SF of its space to TCS & Starquest Expeditions, Inc. (sublease expires November 30, 2021) and 26,386 SF of its space to Hart-Crowser (sublease expires September 30, 2025). |
(6) | Cell Therapeutics has the one-time right and option to terminate its lease after May 2017 by giving no less than 12 months’ prior written notice and paying a termination fee. |
(7) | Cisco Systems has the right to terminate its lease at any time after July 10, 2017, by giving no less than six months’ prior written notice and paying a termination fee. |
(8) | DDB Seattle currently subleases 51,179 SF of its space to ThePlatform through its lease expiration on March 31, 2018. ThePlatform has executed a lease on floors 9, 10 and 11 of the 1000 Second Avenue Property that commences on April 1, 2018 and expires on March 31, 2023. ThePlatform lease includes two, 5-year extension options. |
The following table presents the lease rollover schedule at the Selig Office Portfolio Properties, based on initial lease expiration dates:
Lease Expiration Schedule(1)
Year Ending December 31, | Expiring Owned GLA | % of Owned GLA | Cumulative % of Owned GLA | UW | % of Total UW | UW Base Rent | # of Expiring Suites | # of Expiring Tenants | ||||||||||||||||
MTM | 27,357 | 1.7 | % | 1.7% | $57,156 | 0.1 | % | $2.09 | 36 | 18 | ||||||||||||||
2015 | 70,702 | 4.3 | 6.0% | 1,891,336 | 4.9 | 26.75 | 15 | 12 | ||||||||||||||||
2016 | 275,580 | 16.9 | 22.9% | 6,339,642 | 16.3 | 23.00 | 36 | 20 | ||||||||||||||||
2017 | 195,412 | 12.0 | 34.9% | 5,734,158 | 14.7 | 29.34 | 40 | 22 | ||||||||||||||||
2018 | 90,503 | 5.5 | 40.4% | 2,378,298 | 6.1 | 26.28 | 19 | 15 | ||||||||||||||||
2019 | 165,441 | 10.1 | 50.6% | 4,523,699 | 11.6 | 27.34 | 21 | 19 | ||||||||||||||||
2020 | 181,495 | 11.1 | 61.7% | 4,845,816 | 12.5 | 26.70 | 33 | 18 | ||||||||||||||||
2021 | 54,637 | 3.3 | 65.0% | 1,473,765 | 3.8 | 26.97 | 8 | 6 | ||||||||||||||||
2022 | 154,678 | 9.5 | 74.5% | 4,325,135 | 11.1 | 27.96 | 10 | 6 | ||||||||||||||||
2023 | 183,885 | 11.3 | 85.8% | 4,689,575 | 12.0 | 25.50 | 18 | 7 | ||||||||||||||||
2024 | 0 | 0.0 | 85.8% | 0 | 0.0 | 0.00 | 0 | 0 | ||||||||||||||||
2025 | 107,691 | 6.6 | 92.4% | 2,661,840 | 6.8 | 24.72 | 9 | 3 | ||||||||||||||||
2026 & Thereafter | 237 | 0.0 | 92.4% | 0 | 0.0 | 0.00 | 1 | 1 | ||||||||||||||||
Vacant | 123,839 | 7.6 | 100.0% | 0 | 0.0 | 0.00 | 0 | 0 | ||||||||||||||||
Total / Wtd. Avg. | 1,631,457 | 100.0 | % | $38,920,420 | 100.0 | % | $25.82 | 246 | 147 |
(1) | Calculated based on approximate square footage occupied by each Owned Tenant. |
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The following table presents certain information relating to historical leasing at the Selig Office Portfolio Properties:
Historical Leased %(1)(2)
2010 | 2011 | 2012 | 2013 | 2014 | ||||||
Selig Office Portfolio Properties | 95.7% | 91.8% | 89.6% | 95.0% | 95.8% |
(1) | As provided by the borrower and which represents average occupancy for the indicated year. |
(2) | Historical occupancy information for the 18 West Mercer Street Property was not available for 2010 or 2011, and historical occupancy for the 200 First Avenue West Property is not available for any period. The historical occupancy numbers shown reflect the weighted average occupancy of available occupancy figures. |
The following table presents certain information relating to historical rent per SF at the Selig Office Portfolio Properties:
Historical Weighted Average Rent per SF(1)
Property Name | 2012 | 2013 | 2014 | |||
1000 Second Avenue | $29.03 | $29.62 | $29.98 | |||
2901 Third Avenue | $27.35 | $27.58 | $27.64 | |||
3101 Western Avenue | $26.23 | $27.16 | $27.88 | |||
3131 Elliott Avenue | $25.29 | $25.35 | $25.67 | |||
300 Elliott Avenue West | $22.06 | $22.06 | $22.06 | |||
2615 Fourth Avenue | $24.27 | $24.80 | $25.41 | |||
190 Queen Anne Avenue North | $20.96 | $20.74 | $21.01 | |||
200 First Avenue West | NA | NA | $20.97 | |||
18 West Mercer Street | $21.84 | $21.98 | $22.60 | |||
Total / Wtd. Avg. | $25.98 | $26.34 | $26.42 |
(1) | As provided by the borrower. |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Selig Office Portfolio Properties: |
Cash Flow Analysis(1)
2012 | 2013 | 2014(2) | TTM 1/31/2015(2) | Underwritten | Underwritten $ per SF | |||||||||||||
Base Rent(3) | $34,462,241 | $37,688,219 | $38,287,759 | $38,363,498 | $38,920,420 | $23.86 | ||||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 0 | 3,192,256 | 1.96 | ||||||||||||
Total Rent | $34,462,241 | $37,688,219 | $38,287,759 | $38,363,498 | $42,112,676 | $25.81 | ||||||||||||
Total Reimbursables | 912,986 | 1,022,309 | 1,379,313 | 1,400,356 | 1,320,573 | 0.81 | ||||||||||||
Parking Revenue | 3,426,089 | 3,704,549 | 3,584,885 | 3,594,843 | 3,594,843 | 2.20 | ||||||||||||
Other Revenue(4) | 743,928 | 756,308 | 785,696 | 817,004 | 817,004 | 0.50 | ||||||||||||
Vacancy & Credit Loss | (35,785 | ) | (1,629 | ) | (94,310 | ) | (94,310 | ) | (3,192,256 | ) | (1.96 | ) | ||||||
Effective Gross Income | $39,509,460 | $43,169,757 | $43,943,344 | $44,081,390 | $44,652,839 | $27.37 | ||||||||||||
Total Operating Expenses | $12,267,650 | $12,489,151 | $12,835,713 | $12,810,605 | $12,576,474 | $7.71 | ||||||||||||
Net Operating Income | $27,241,810 | $30,680,606 | $31,107,630 | $31,270,786 | $32,076,365 | $19.66 | ||||||||||||
TI/LC | 0 | 0 | 0 | 0 | 1,361,353 | 0.83 | ||||||||||||
Replacement Reserves | 0 | 0 | 0 | 0 | 407,864 | 0.25 | ||||||||||||
Net Cash Flow | $27,241,810 | $30,680,606 | $31,107,630 | $31,270,786 | $30,307,148 | $18.58 |
(1) | Certain items such as straight line rent, interest expense, interest income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. |
(2) | With respect to the 200 First Avenue West Property, the first six months of cash flow in 2014 (prior to the borrower sponsor’s acquisition of such property) is not available. As such, the last six months of 2014 were annualized and presented in lieu of full-year 2014 financials, and the annualized trailing seven month cash flows are presented in lieu of TTM 1/31/2015 cash flows. |
(3) | Underwritten cash flow is based on contractual rents as of February 23, 2015 and contractual rent steps through April 30, 2016. Underwritten Base Rent includes $224,953 of rental revenue for Triton Radio Networks, which is dark but still paying as of June 2015, and such lease expires in February 2016. Underwritten Base Rent also includes $522,100 for the following three tenants that have executed leases but have not yet taken occupancy or begun paying rent: CKCA2 Inc., Sound View Advisors and Koru Careers, Inc. An unexecuted lease holdback of $3,900,807 was established at loan origination (and has since been released). We cannot assure you that these tenants will take occupancy or begin paying rent as expected or at all. See“—Escrows” below. |
(4) | Other Revenue includes storage rent and antenna rent. |
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n | Appraisals.According to the appraisals dated as of March 2, 2015, the Selig Office Portfolio Properties had an aggregate “as-is” appraised value of $544,500,000 and an aggregate “as stabilized” appraised value of $553,400,000, based on the “as stabilized” appraised values at four of the Selig Office Portfolio Properties as of dates ranging from September 2015 to June 2016 and based on assumed stabilized occupancy at those Selig Office Portfolio Properties. |
n | Environmental Matters.According to a Phase I environmental report dated March 6, 2015, a recognized environmental condition was identified at the 18 West Mercer Street Property due to the remediation of petroleum or other solvents. However, responsible third parties have been identified, and no further action was recommended. The report also recommended further evaluation to determine if groundwater being discharged from onsite sump pump required pre-treatment before discharge, and that an onsite groundwater monitoring well be decommissioned if no longer required for a past gas station investigation. A Phase I environmental report dated March 4, 2015 with respect to the 300 Elliott Avenue West Property recommended that two onsite monitoring wells be decommissioned by a licensed professional if no longer required for environmental cleanup. A Phase I environmental report dated March 4, 2015 with respect to the 2615 Fourth Avenue Property recommended continued investigation and remediation of the documented soil and groundwater impacts on the property and the implementation of an asbestos operations and maintenance (“O&M”) plan at the property. A Phase I environmental report dated March 4, 2015 with respect to the 3131 Elliott Avenue Property identified a recognized environmental condition as a result of an adjacent property being listed in the regulatory database due to the presence of non-halogenated solvents, unspecified petroleum products and polynuclear aromatic hydrocarbons in both soil and groundwater and pending cleanup. However, as responsible third parties have been identified, no further action was recommended. A Phase I environmental report dated March 4, 2015 with respect to the 3101 Western Avenue Property identified a recognized environmental condition as a result of the age of an underground storage tank located on the property. The consultant recommended annual tank tightness testing and inspection of the root system. In addition, the report identified an adjacent property being listed in the regulatory database due to the presence of polynuclear aromatic hydrocarbons, petroleum products and non-halogenated solvents in the soils and groundwater and pending cleanup. However, as responsible third parties have been identified, no further action was recommended. According to the remaining Phase I environmental reports, each dated between March 4, 2015 and March 6, 2015, there are no recognized environmental conditions or recommendations for further action other than a recommendation for an asbestos O&M plan at the 190 Queen Anne Avenue North and 200 First Avenue Properties. |
n | Market Overview and Competition. The Selig Office Portfolio Properties are located within the Seattle central business district, which contains approximately 41.9 million SF of office space with a direct vacancy level of 10.4% as of the fourth quarter of 2014, and rents with a weighted average asking rate of $31.37 per SF. The Seattle central business district recorded approximately 3.1 million SF of office leasing activity and approximately 1.5 million SF of absorption in 2014. The 1000 2nd Avenue Property is located in the Financial District submarket, and of the remaining eight properties, four are located in the Lower Queen Anne / Lake Union submarket and four are located in the Denny Regrade submarket. Office space in the Financial District submarket totaled 21.4 million SF with a direct vacancy level of 10.6% as of the fourth quarter of 2014 and average asking rents of $35.58 per SF. Office space in the Lower Queen Anne / Lake Union submarket totaled 8.1 million SF with a direct vacancy level of 4.4% as of the fourth quarter of 2014, and average asking rents of $31.16 per SF. Office space in the Denny Regrade submarket totaled 8.1 million SF with a direct vacancy level of 6.7% as of the fourth quarter of 2014, and direct average asking rents of $33.02 per SF. The Selig Office Portfolio Properties compete with office properties of similar location, type and class, which vary across the Selig Office Portfolio. |
n | The Borrower. The borrower of the Selig Office Portfolio Loan Combination is Selig Holdings Company L.L.C., a single-purpose entity that owns no assets other than the Selig Office Portfolio Properties. The non-recourse carveout guarantors are Selig Family Holdings, LLC and Martin Selig, jointly and severally. Legal counsel to the borrower delivered a non-consolidation opinion in connection with the origination of the Selig Office Portfolio Loan Combination. Martin Selig is the principal and founder of Martin Selig Real Estate. Martin Selig Real Estate was founded in 1958 and is a privately-held company in the commercial real estate industry in the state of Washington. Martin Selig Real Estate is headquartered in Seattle, Washington where it owns and operates a portfolio of 20 office properties totaling approximately 3.5 million SF of space. |
n | Escrows.In connection with the origination of the Selig Office Portfolio Loan, the borrower funded (a) a tax reserve of $255,019, (b) a deferred maintenance reserve of $337,524, (c) an unfunded obligations reserve of $3,377,855 related to tenant improvements and free rent at the Selig Office Portfolio Properties and (d) an unexecuted lease holdback in the amount of $3,900,807 relating to two leases covering a total of 14,642 SF at the Selig Office Portfolio Properties which were unexecuted and out for signature at the time of origination. |
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Subsequently, both leases referred to in clause (d) of the prior sentence were executed and have been delivered to the borrower, and in connection therewith, $2,145,444 has been released related to the CKCA2 Inc. lease, and the remaining $1,755,363 has been released related to the Koru Careers, Inc. lease. |
On each due date, the borrower will be required to fund (i) a tax reserve in an amount equal to one-twelfth of the amount that the lender estimates will be necessary to pay taxes over the then succeeding 12-month period, (ii) an insurance reserve in an amount equal to one-twelfth of the amount that the lender estimates will be necessary to pay insurance premiums over the then succeeding 12-month period, (iii) a tenant improvements and leasing commissions reserve in the amount of $203,932, (iv) a replacement reserve in the amount of $33,989, and (v) if a Holland America Reserve Period is continuing, the Holland America reserve account in an amount equal to the Holland America Reserve Amount.
“Holland America Reserve Period” means the period (A) commencing on the date that is 18 months prior to the expiration of Holland America Line, Inc.’s (“Holland America”) lease, to the extent that, as of such date, (x) Holland America has not exercised its option to renew or extend its lease and (y) substantially all of the space covered by such lease has not been re-let pursuant to one or more replacement leases entered into in accordance with the Selig Office Portfolio Loan documents and (B) ending on the earlier of the date that (x) the Holland America reserve account first contains the Holland America Reserve Cap Amount or (y) at least 90% of the space covered by Holland America’s lease has been re-let pursuant to one or more replacement leases entered into in accordance with the Selig Office Portfolio Loan documents.
“Holland America Reserve Cap Amount” means $3,000,000 times a fraction, (i) the numerator of which is the amount of space covered by Holland America’s lease as of the origination date of the Selig Office Portfolio Loan that has not been re-let pursuant to one or more replacement leases and (ii) the denominator of which is $179,042.
“Holland America Reserve Amount” means, with respect to any due date during the continuance of a Holland America Reserve Period, the lesser of: (x) $170,000 times a fraction, (i) the numerator of which is the amount of space covered by Holland America’s lease as of the origination date of the Selig Office Portfolio Loan that has not been re-let pursuant to one or more replacement leases and (ii) the denominator of which is $179,042; and (y) the amount necessary to cause the amount contained in the Holland America reserve account to equal the Holland America Reserve Cap Amount.
n | Lockbox and Cash Management. The Selig Office Portfolio Loan Combination requires a hard lockbox, which is already in place. The Selig Office Portfolio Loan documents require the borrower to direct the tenants to pay their rents directly to a lender-controlled lockbox account. The Selig Office Portfolio Loan documents also require that all rents received by the borrower or the property manager be deposited into the lockbox account within one business day after receipt. All amounts in the lockbox account are required to be swept on a daily basis to a lender-controlled cash management account. |
On each business day that no Selig Office Portfolio Trigger Period or event of default under the Selig Office Portfolio Loan is continuing, all amounts in the cash management account in excess of the amounts required to pay monthly reserves and debt service on the next due date are required to be deposited into a borrower-controlled account containing only amounts relating to the Selig Office Portfolio Loan Combination (the “Operating Account”). On each due date during a Selig Office Portfolio Trigger Period (and, at lender’s option, during the continuance of an event of default until the Selig Office Portfolio Loan Combination has been accelerated), the Selig Office Portfolio Loan documents require that all amounts on deposit in the cash management account be used to pay debt service, required reserves and operating expenses and that all remaining amounts be reserved in an excess cash flow reserve account. So long as no event of default is continuing, all amounts in the excess cash flow reserve account are required to be swept into the cash management account on the first due date after which the borrower delivers evidence reasonably satisfactory tothe lender that no Selig Office Portfolio Trigger Period is then continuing. During the continuance of an event of default, the lender may apply all funds on deposit in the cash management account to amounts payable under the Selig Office Portfolio Loan Combination in such order of priority as the lender may determine.
A “Selig Office Portfolio Trigger Period” means the period (A) commencing as of the end of any fiscal quarter in which the net operating income (as calculated under the Selig Office Portfolio Loan documents) of the Selig Office Portfolio Properties for the 12-month period immediately preceding such fiscal quarter end is less than $25,403,954 (as adjusted to account for property releases) and terminating as of the end of the second
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consecutive fiscal quarter in which the net operating income of the Selig Office Portfolio Properties for the 12-month period immediately preceding such fiscal quarter end is equal to or greater than $25,403,954 (as adjusted to account for property releases) or (B) commencing upon the borrower’s failure to deliver the required annual, quarterly and monthly financial reports and ending when such financial reports are delivered and indicate that no trigger period under clause (A) above has commenced.
n | Permitted Pari Passu Debt. Upon 30 days’ prior written notice to the lender, the borrower has a one-time right (an “Additional Permitted Debt Election”) to incur up to $51,750,000 of additionalpari passu fixed-rate debt that is co-terminous with the Selig Office Portfolio Loan (“Additional Permitted Debt”) secured by the Selig Office Portfolio Properties, provided that each of the following requirements is satisfied: (i) immediately after giving effect to such Additional Permitted Debt, if the borrower requests the lender’s approval of an Additional Permitted Debt Election on or prior to March 19, 2020, the aggregate loan-to-value ratio (as calculated under the Selig Office Portfolio Loan documents) does not exceed 60%, and if the borrower requests the lender’s approval of an Additional Permitted Debt Election after March 19, 2020, the aggregate loan-to-value ratio does not exceed 58% (in each case, taking into account the principal amount of such Additional Permitted Debt); (ii) immediately after giving effect to such Additional Permitted Debt, the debt service coverage ratio (as calculated under the Selig Office Portfolio Loan documents) for the 12-month period immediately preceding the most recently ended fiscal quarter is equal to or greater than 2.44x (in each case, taking into account debt service for such Additional Permitted Debt); (iii) immediately after giving effect to such Additional Permitted Debt, if the borrower requests the lender’s approval of an Additional Permitted Debt Election on or prior to March 19, 2020, the debt yield (as calculated under the Selig Office Portfolio Loan documents) for the 12-month period immediately preceding the most recently ended fiscal quarter is no less than 9.25%, and if such request is made after March 19, 2020, the debt yield for the 12-month period immediately preceding such fiscal quarter end is no less than 9.5% (in each case, taking into account the principal amount of such Additional Permitted Debt); (iv) the lender of the Additional Permitted Debt enters into a co-lender agreement with the lender; (v) a Rating Agency Confirmation is obtained; (vi) a REMIC opinion, as well as updated non-consolidation and enforceability opinions, are delivered; (vii) the borrower, the lender and the lender of the Additional Permitted Debt execute amendments to the Selig Office Portfolio Loan documents reasonably requested by any such party to reflect the existence of such Additional Permitted Debt; (viii) the borrower pays all reasonable out of pocket costs and expenses incurred by the lender; and (ix) the lender otherwise approves, in its sole discretion applied in good faith and using commercially reasonable standards, the terms, documentation, lender, and incurrence of such loan. |
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n | Mezzanine or Subordinate Indebtedness.Fixed rate mezzanine debt is permitted once during the term of the Selig Office Portfolio Loan from certain qualified institutional lenders meeting the requirements set forth in the Selig Office Portfolio Loan documents to a direct owner of the borrower that is secured by a pledge of direct equity interests in the borrower (a “Permitted Mezzanine Loan”), so long as each of the following requirements is satisfied: (i) if the borrower requests the lender’s approval of an Additional Permitted Debt Election on or prior to March 19, 2020, the aggregate loan-to-value ratio (as calculated under the Selig Office Portfolio Loan documents) does not exceed 60% and if such request is made after March 19, 2020, the aggregate loan-to-value ratio does not exceed 58% (in each case, taking into account the principal amount of such Permitted Mezzanine Loan); (ii) the debt yield (as calculated under the Selig Office Portfolio Loan documents) for the 12-month period immediately preceding such fiscal quarter end is at least 9.5% (taking into account the principal amount of such Permitted Mezzanine Loan); (iii) the debt service coverage ratio (as calculated under the Selig Office Portfolio Loan documents) for the 12-month period immediately preceding such fiscal quarter end is at least 2.44x (taking into account debt service under such Permitted Mezzanine Loan); (iv) no event of default has occurred and is continuing under any of the Selig Office Portfolio Loan documents; (v) the lender has received evidence that the Permitted Mezzanine Loan has no adverse effect on the bankruptcy remote status of the borrower under the rating agency requirements and a new non-consolidation opinion; (vi) the lender receives all items reasonably required to evaluate and approve of the Permitted Mezzanine Loan, including current rent rolls, operating statements and financial statements; (vii) the lender determines that there has been no material adverse change in the condition, financial, physical or otherwise, of any of the Selig Office Portfolio Properties or the borrower from and after the origination date of the Selig Office Portfolio Loan; (viii) the borrower has executed amendments to the Selig Office Portfolio Loan documents reasonably required by the lender to reflect the existence of such Permitted Mezzanine Loan and has received enforceability and due authorization opinions with respect thereto; (ix) the borrower pays all reasonable out of pocket costs and expenses incurred by the lender; (x) a Rating Agency Confirmation has been obtained; and (xi) the lender has otherwise approved the terms and documentation of such loan. |
n | Release of Collateral. Provided no event of default under the Selig Office Portfolio Loan is then continuing, at any time on or after the first due date following the earlier to occur of (a) the third anniversary of the origination date of the Selig Office Portfolio Loan and (b) the second anniversary of the closing date of the securitization into which the last Selig Office Portfolio Companion Loan to be securitized is deposited, the borrower may obtain the release of one or more of the Selig Office Portfolio Properties from the lien of the Selig Office Portfolio Loan documents, subject to the satisfaction of certain conditions set forth in the Selig Office Portfolio Loan documents, including among others: (i) delivery of defeasance collateral in an amount equal to the Selig Office Portfolio Release Price for each Selig Office Portfolio Property being released; (ii) after giving effect to the release, the debt service coverage ratio (as calculated under the Selig Office Portfolio Loan documents) for the remaining Selig Office Portfolio Properties for the 12-month period preceding the end of the most recent fiscal quarter is no less than the greater of (a) 2.32x and (b) the debt service coverage ratio immediately prior to the release; and (iii) delivery of Rating Agency Confirmation with respect to such defeasance. |
“Selig Office Portfolio Release Price” means, with respect to the release of any Selig Office Portfolio Property, the greater of (x) 90% of net sales proceeds with respect to such Selig Office Portfolio Property and (y) (i) in the case of the 3131 Elliott Avenue Property, the 300 Elliott Avenue Property, the 2901 Third Avenue Property and the 1000 Second Avenue Property, 125% of their respective allocated loan amounts and (ii) in the case of the 3101 Western Avenue Property, the 2615 Fourth Avenue Property, the 190 Queen Anne Avenue North Property, the 18 West Mercer Street Property and the 200 First Avenue West Property, 115% of their respective allocated loan amounts.
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n | Terrorism Insurance.So long as TRIPRA or a similar or subsequent statute is in effect, the borrower is required to maintain terrorism insurance for foreign and domestic acts (as those terms are defined under TRIPRA or a similar or subsequent statute) in an amount equal to the full replacement cost of the Selig Office Portfolio Properties, plus 12 months of rental loss and/or business interruption coverage. If TRIPRA or a similar or subsequent statute is not in effect, then provided that terrorism insurance is commercially available, the borrower is required to carry terrorism insurance throughout the term of the Selig Office Portfolio Loan as described in the preceding sentence, but will not be required to spend more than two times the amount of the insurance premium that is payable at that time in respect of the property and business interruption/rental loss insurance required under the Selig Office Portfolio Loan documents on a stand-alone basis (not including the terrorism and earthquake components of such casualty and business interruption/rental loss insurance). If the cost of terrorism insurance exceeds such amount, then the borrower is required to purchase the maximum amount of terrorism insurance available on the current market rates withfunds equal to such amount, in either such case with a deductible not exceeding $50,000. The required terrorism insurance may be included in a blanket policy, provided that the borrower provides evidence reasonably satisfactory to the lender that the insurance premiums for the Selig Office Portfolio Properties are separately allocated to the Selig Office Portfolio Properties under the blanket policy. See “Risk Factors—Terrorism Insurance May Not Be Available for All Mortgaged Properties” in the Prospectus Supplement. |
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Mortgaged Property Information | Mortgage Loan Information | ||||||
Number of Mortgaged Properties | 1 | Loan Seller | GSMC | ||||
Location (City/State) | Dallas, Texas | Cut-off Date Principal Balance(4) | $71,803,978 | ||||
Property Type | Merchandise Mart | Cut-off Date Principal Balance per SF(1)(3) | $83.27 | ||||
Size (SF)(1) | 3,101,772 | Percentage of Initial Pool Balance | 9.9% | ||||
Total Occupancy as of 4/22/2015(2) | 88.3% | Number of Related Mortgage Loans | None | ||||
Owned Occupancy as of 4/22/2015(2) | 88.3% | Type of Security(5) | Fee Simple | ||||
Year Built / Latest Renovation | 1959, 1974, 1978, 1984, 2007 / 2007 | Mortgage Rate | 4.0975% | ||||
Appraised Value | $403,000,000 | Original Term to Maturity (Months) | 120 | ||||
Original Amortization Term (Months) | 360 | ||||||
Original Interest Only Period (Months) | NAP | ||||||
Underwritten Revenues | $66,737,601 | ||||||
Underwritten Expenses | $32,904,905 | Escrows | |||||
Underwritten Net Operating Income (NOI) | $33,832,696 | Upfront | Monthly | ||||
Underwritten Net Cash Flow (NCF) | $31,915,179 | Taxes | $439,167 | $87,833 | |||
Cut-off Date LTV Ratio(3) | 64.1% | Insurance | $47,500 | $0 | |||
Maturity Date LTV Ratio(3) | 51.2% | Replacement Reserve(6) | $910,580 | $0 | |||
DSCR Based on Underwritten NOI / NCF(3) | 2.25x / 2.13x | TI/LC(7) | $1,500,000 | $0 | |||
Debt Yield Based on Underwritten NOI / NCF(3) | 13.1% / 12.4% | Other | $0 | $0 |
Sources and Uses | |||||
Sources | $ | % | Uses | $ | % |
Loan Combination Amount | $259,000,000 | 100.0% | Loan Payoff | $131,719,468 | 50.9% |
Principal Equity Distribution(8) | 122,644,953 | 47.4 | |||
Reserves | 2,897,247 | 1.1 | |||
Closing Cost | 1,738,333 | 0.7 | |||
Total Sources | $259,000,000 | 100.0% | Total Uses | $259,000,000 | 100.0% |
(1) | The total collateral square footage includes 2,642,142 SF from permanent showroom tenants, 82,630 SF of administrative office space (utilized by property management) and 377,000 SF of temporary show space. | ||
(2) | Total Occupancy and Owned Occupancy are based on permanent showroom space and the 82,630 SF of administrative office space (utilized by property management), and excludes the 377,000 SF of temporary show space. | ||
(3) | Calculated based on the aggregate balance of the Dallas Market Center Loan Combination. | ||
(4) | The Cut-off Date Principal Balance of $71,803,978 represents the non-controlling note A-2 of a $258,294,865 loan combination evidenced by threepari passu notes. The companion loans are evidenced by the controlling note A-1 and the non-controlling note A-3. Note A-1, with a principal balance of $129,646,071 as of the Cut-off Date, was contributed to the GS Mortgage Securities Trust 2015-GC30, Commercial Mortgage Pass-Through Certificates, Series 2015-GC30 (“GSMS 2015-GC30”) transaction and note A-3, with a principal balance of $56,844,816 as of the Cut-off Date, is currently held by Goldman Sachs Mortgage Company and is expected to be contributed to one or more future securitization transactions. | ||
(5) | The Dallas Market Center Loan is subject to four ground leases. The borrower sponsor controls both landlord and tenant under each of the ground leases. | ||
(6) | The Replacement Reserve is capped at $910,580. See“—Escrows” below. | ||
(7) | The TI/LC reserve is capped at $1,500,000. See“—Escrows” below. | ||
(8) | Principal equity distribution was utilized by the borrower for the buyout of its existing equity partner. The total buyout amount was $140,000,000 and closed in conjunction with the origination of the Dallas Market Center Loan. |
■ | The Mortgage Loan. The mortgage loan (the “Dallas Market Center Loan”) is part of a loan combination (the “Dallas Market Center Loan Combination”) evidenced by threepari passu notes that are together secured by a first mortgage encumbering the borrower’s fee simple interest in two buildings that comprise a portion of the Dallas Market Center campus located in Dallas, Texas (the “Dallas Market Center Property”). The Dallas Market Center Loan (evidenced by note A-2), which represents the non-controlling interest in the Dallas Market Center Loan Combination, will be contributed to the Issuing Entity, has an outstanding principal balance as of the Cut-off Date of $71,803,978 and represents approximately 9.9% of the Initial Pool Balance. The related companion loans (collectively, the “Dallas Market Center Companion Loan”) are evidenced by: (i) note A-1, which has an outstanding principal balance as of the Cut-off Date of $129,646,071, represents the controlling interest in the Dallas Market Center Loan Combination and was contributed to the GSMS 2015-GC30 transaction; and (ii) note A-3, which has an outstanding principal balance as of the Cut-off Date of $56,844,816, represents a non-controlling interest in the Dallas Market Center Loan Combination, is currently held by Goldman Sachs Mortgage Company outside the Issuing Entity and is expected to be contributed to one or more future securitization transactions. The Dallas Market Center Loan Combination was originated by Goldman Sachs Mortgage Company on April 29, 2015 and has an original principal balance of $259,000,000. Each note has an interest rate of 4.0975%per annum. The borrower utilized the proceeds of the Dallas Market Center Loan Combination to refinance the existing debt on the Dallas Market Center Property, pay origination costs, fund reserves and buy out the borrower’s existing equity partner. |
The Dallas Market Center Loan had an initial term of 120 months and has a remaining term of 118 months as of the Cut-off Date. The Dallas Market Center Loan requires payments of interest and principal based on a 30-year amortization schedule during its term. The scheduled maturity date of the Dallas Market Center Loan is the due date in May 2025. The Dallas Market Center Loan may be voluntarily prepaid on or after the due date in February 2025 without payment of a prepayment premium. Provided that no event of default under the Dallas Market Center Loan is continuing, defeasance with direct, non-callable obligations of the United States of America is permitted at any time on or after the first due date following earlier of (a) the third anniversary of the origination
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date of the Dallas Market Center Loan and (b) the second anniversary of the closing date of the securitization into which the last Dallas Market Center Companion Loan is deposited.
■ | The Mortgaged Property.The Dallas Market Center Property is a wholesale merchandise mart that consists of two buildings (the “World Trade Center” and the “Trade Mart”) totaling approximately 3,101,772 SF of rentable space in Dallas, Texas. Approximately 2,642,142 SF of the total rentable area is permanent showroom space occupied by approximately 1,100 tenants, approximately 377,000 SF is exhibition space that is temporarily leased to tenants during various trade shows and markets throughout the year and 82,630 SF is administrative office space (occupied by property management) located on the fifth floor of the Trade Mart. The Dallas Market Center Property comprises a portion of the four-building Dallas Market Center campus, which includes the World Trade Center (which is included in the collateral for the Dallas Market Center Loan), the Trade Mart (which is included in the collateral for the Dallas Market Center Loan), the International Trade Plaza building (which is not included in the collateral for the Dallas Market Center Loan) and the Market Hall building (which is not included in the collateral for the Dallas Market Center Loan). Parking for the Dallas Market Center Property is provided by 2,156 parking spaces located in three structured parking garages and surface spaces which are part of the collateral. The non-collateral buildings are owned by an affiliate of the borrower. As of April 22, 2015, Total Occupancy and Owned Occupancy for the Dallas Market Center Property were both approximately 88.3% (based on permanent SF). |
The Dallas Market Center campus was constructed in order to respond to the needs of the wholesale trading community and totals 5.25 million gross SF in four facilities. The Dallas Market Center Property offers manufacturers, or their distributors and sales representatives, centralized permanent showrooms for year-round exhibition of their products. By committing to permanent space, in addition to having the availability of a year-round sales facility, tenants have the ability to participate in the various markets and trade shows held at the Dallas Market Center Property. The Dallas Market Center Property is located at the intersection of Interstate 35 (Stemmons Freeway) and Market Center Boulevard, just northwest of downtown and uptown Dallas. A majority of the tenants at the Dallas Market Center Property (representing approximately 85% of the rental revenue) lease permanent showroom space and are open year-around while others lease temporary space to maintain a presence at specific markets. The temporary space (377,000 SF) intentionally is not leased on a long term basis so it can be used to hold markets.
The World Trade Center contains approximately 2.9 million gross SF of which approximately 1.94 million SF is rentable permanent showroom space. The first seven floors opened in 1974 and later expanded to 15 floors in 1978. Nine of its floors house showrooms of gifts, decorative accents, lighting, furniture, rugs, textiles, fabric, jewelry, toys and design furnishings. Temporary exhibits can be found on floors 1, 6, 8, 12 and 13 during markets.
The Trade Mart contains approximately 1.5 million gross SF of which approximately 701,000 SF is rentable permanent showroom space. Completed in 1959, its four floors are home to hundreds of showrooms featuring gifts, decorative accents, lighting, tabletops and stationery. The Trade Mart was last renovated and expanded in 2007, adding two additional floors of showroom space, two floors of garage parking and a modernized atrium.
Most of the tenants at the Dallas Market Center Property are small with an average tenant size of just over 2,000 SF for all of the currently leased space. This is considered typical of the merchandise/mart industry, which has a number of independent wholesale representatives that do not have a need for expansive floor space. Within the Dallas Market Center Property, the Gift Industry is the largest industry segment with over 600,000 SF of space situated on the first and second floors of the Trade Mart and second, third and fourth floors of the World Trade Center. Following closely behind is the Lighting Industry with almost 500,000 SF of space mainly located on the third and fourth floors of the Trade Mart. The Dallas Market Center Property also has large concentrations of businesses within the home furnishings, children’s and women’s wear industry segments.
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The following table presents certain information relating to the major tenants at the Dallas Market Center Property:
Ten Largest Owned Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating (Fitch/MIS/S&P) | Tenant GLA | % of Owned GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | Sales per SF | Lease Expiration | Renewal / Extension Options | ||||||||||||||
Don Bernard & Associates, LLC | NR / NR / NR | 20,737 | 0.7 | % | $597,421 | 0.9 | % | $28.81 | NA | (1) | NA | ||||||||||||
Cliff Price & Co., Inc. | NR / NR / NR | 20,834 | 0.7 | 578,061 | 0.9 | 27.75 | NA | (2) | NA | ||||||||||||||
Generation Brands, LLC(3) | NR / NR / NR | 23,667 | 0.8 | 577,948 | 0.9 | 24.42 | NA | 8/31/2016 | NA | ||||||||||||||
Ivystone Group, LLC | NR / NR / NR | 22,759 | 0.7 | 576,979 | 0.9 | 25.35 | NA | (4) | NA | ||||||||||||||
Hudson Valley Lighting, Inc. | NR / NR / NR | 16,742 | 0.5 | 547,463 | 0.9 | 32.70 | NA | 9/30/2017 | NA | ||||||||||||||
Goetz, Inc. | NR / NR / NR | 20,477 | 0.7 | 522,828 | 0.8 | 25.53 | NA | 6/30/2018 | NA | ||||||||||||||
Hinkley Lighting, Inc. | NR / NR / NR | 17,327 | 0.6 | 485,472 | 0.8 | 28.02 | NA | 8/31/2016 | NA | ||||||||||||||
The L.D. Kichler Company | NR / NR / NR | 28,633 | 0.9 | 483,325 | 0.8 | 16.88 | NA | (5) | NA | ||||||||||||||
Western Reps, Inc. | NR / NR / NR | 18,345 | 0.6 | 465,587 | 0.7 | 25.38 | NA | (6) | NA | ||||||||||||||
Midwest – CBK, LLC | NR / NR / NR | 15,756 | 0.5 | 384,027 | 0.6 | 24.37 | NA | 7/31/2018 | NA | ||||||||||||||
Ten Largest Permanent Tenants | 205,277 | 6.6 | % | $5,219,112 | 8.1 | % | $25.42 | ||||||||||||||||
Remaining PermanentTenants(7) | 2,201,262 | 71.0 | 49,592,654 | 77.0 | 22.53 | ||||||||||||||||||
Vacant Space | 318,233 | 10.3 | 0 | 0.0 | 0.00 | ||||||||||||||||||
Total / Wtd. Avg. All Permanent Tenants | 2,724,772 | 87.8 | % | $54,811,766 | 85.1 | % | $22.78 | ||||||||||||||||
Total Temporary Tenants | 377,000 | 12.2 | % | $9,569,365 | 14.9 | % | $25.38 | ||||||||||||||||
Total / Wtd. Avg. All Owned Tenants | 3,101,772 | 100.0 | % | $64,381,131 | 100.0 | % | $23.13 |
(1) | Don Bernard & Associates, LLC has five separate lease expirations, including 12,167 SF of space ($30.54 base rent per SF) expiring on October 31, 2016, 3,900 SF of space ($29.23 base rent per SF) expiring on January 30, 2016, 2,659 SF of space ($37.02 base rent per SF) expiring on September 30, 2017, 1,486 SF of space ($3.37 base rent per SF) expiring on August 31, 2015 and 525 SF of space ($16.00 base rent per SF) expiring on October 31, 2017. | ||
(2) | Cliff Price & Co., Inc. has three separate lease expirations, including 13,607 SF of space ($27.98 base rent per SF) expiring on September 30, 2020, 3,855 SF of space ($28.78 base rent per SF) expiring on September 30, 2020 and 3,372 SF of space ($25.62 base rent per SF) expiring on January 31, 2017. | ||
(3) | Generation Brands, LLC d/b/a Murray Feiss Imports and Monte Carlo Fans. | ||
(4) | Ivystone Group, LLC has two separate lease expirations, including 21,728 SF of space ($26.32 base rent per SF) expiring on April 30, 2017 and 1,031 SF of space ($5.00 base rent per SF) expiring on September 30, 2016. | ||
(5) | The L.D. Kichler Company has two separate lease expirations, including 23,948 SF of space ($16.88 base rent per SF) expiring on August 31, 2016 and 4,685 SF of space ($16.88 base rent per SF) expiring on November 30, 2015. | ||
(6) | Western Reps, Inc. has four separate lease expirations, including 12,735 SF of space ($25.68 base rent per SF) expiring on March 31, 2019, 4,203 SF of space ($26.74 base rent per SF) expiring on March 31, 2020, 957 SF of space ($25.00 base rent per SF) expiring on October 31, 2016 and 450 SF of space ($5.00 base rent per SF) expiring on May 31, 2015. | ||
(7) | Includes 82,630 SF of administrative office space (utilized by property management). |
The following table presents certain information relating to the lease rollover schedule at the Dallas Market Center Property, based on initial lease expiration dates:
Lease Expiration Schedule(1)
Year Ending December 31, | Expiring Owned GLA | % of Owned GLA | Cumulative % of Owned GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | # of Expiring Tenants | ||||||||||||||
MTM | 83,547 | 3.1 | % | 3.1% | $1,405,676 | 2.6 | % | $16.82 | 47 | ||||||||||||
2015 | 320,931 | 11.8 | 14.8% | 6,733,812 | 12.3 | 20.98 | 335 | ||||||||||||||
2016 | 677,694 | 24.9 | 39.7% | 16,419,385 | 30.0 | 24.23 | 328 | ||||||||||||||
2017 | 653,707 | 24.0 | 63.7% | 15,263,184 | 27.8 | 23.35 | 230 | ||||||||||||||
2018 | 257,867 | 9.5 | 73.2% | 6,982,134 | 12.7 | 27.08 | 88 | ||||||||||||||
2019 | 247,631 | 9.1 | 82.3% | 6,014,639 | 11.0 | 24.29 | 56 | ||||||||||||||
2020 | 80,878 | 3.0 | 85.2% | 1,953,313 | 3.6 | 24.15 | 16 | ||||||||||||||
2021 | 0 | 0.0 | 85.2% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2022 | 0 | 0.0 | 85.2% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2023 | 1,150 | 0.0 | 85.3% | 28,451 | 0.1 | 24.74 | 1 | ||||||||||||||
2024 | 0 | 0.0 | 85.3% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2025 | 504 | 0.0 | 85.3% | 11,174 | 0.0 | 22.17 | 1 | ||||||||||||||
2026 & Thereafter(2) | 82,630 | 3.0 | 88.3% | 0 | 0.0 | 0.00 | 1 | ||||||||||||||
Vacant | 318,233 | 11.7 |
| 100.0% | 0 |
| 0.0 |
| 0.00 |
| 0 |
| |||||||||
Total / Wtd. Avg. | 2,724,772 | 100.0 | % | $54,811,766 | 100.0 | % | $22.78 | 1,103 |
(1) | Calculated based on approximate square footage occupied by each Owned Tenant, exclusive of the 377,000 SF of temporary tenant space. | ||
(2) | Represents 82,630 SF of administrative office space. |
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The following table presents certain information relating to historical leasing at the Dallas Market Center Property:
Historical Leased %(1)
TTM February 2011 | TTM February 2012 | TTM February 2013 | TTM February 2014 | TTM February 2015 | ||||
81.6% | 81.6% | 82.6% | 85.0% | 88.5% |
(1) | As provided by the borrower and which represents average occupancy for the indicated 12-month period. |
The following table presents certain information relating to historical base rent per SF at the Dallas Market Center Property:
Historical Average Base Rent per SF(1)
TTM February 2012 | TTM February 2013 | TTM February 2014 | TTM February 2015 | |||
$23.28 | $23.07 | $22.71 | $22.32 |
(1) | As provided by the borrower and which represents average base rent for the total current permanent space for the given time period. |
■ | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Dallas Market Center Property: |
Cash Flow Analysis(1)
TTM February 2012 | TTM February 2013 | TTM February 2014 | TTM February 2015 | Underwritten | Underwritten $ per SF | |||||||||||||
Base Rent(2) | $50,201,733 | $50,354,958 | $50,994,144 | $52,199,011 | $54,811,766 | $17.67 | ||||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 0 | 7,644,527 | 2.46 | ||||||||||||
Total Rent | $50,201,733 | $50,354,958 | $50,994,144 | $52,199,011 | $62,456,293 | $20.14 | ||||||||||||
Temporary Tenant Revenue | 7,917,866 | 8,442,508 | 8,952,879 | 9,569,365 | 9,569,365 | 3.09 | ||||||||||||
Other Income | 2,828,215 | 2,907,630 | 2,890,827 | 2,945,632 | 2,945,632 | 0.95 | ||||||||||||
Vacancy & Credit Loss(3) | 0 | 0 | 0 | 0 | (8,233,689 | ) | (2.65 | ) | ||||||||||
Effective Gross Income | $60,947,814 | $61,705,096 | $62,837,850 | $64,714,008 | $66,737,601 | $21.52 | ||||||||||||
Total Operating Expenses | $30,874,612 | $30,976,915 | $31,005,176 | $31,529,354 | $32,904,905 | $10.61 | ||||||||||||
Net Operating Income | $30,073,202 | $30,728,181 | $31,832,674 | $33,184,654 | $33,832,696 | $10.91 | ||||||||||||
TI/LC | 0 | 0 | 0 | 0 | 1,153,463 | 0.37 | ||||||||||||
Capital Expenditures | 0 | 0 | 0 | 0 | 764,053 | 0.25 | ||||||||||||
Net Cash Flow | $30,073,202 | $30,728,181 | $31,832,674 | $33,184,654 | $31,915,179 | $10.29 |
(1) | Certain items such as straight line rent, interest expense, interest income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. | ||
(2) | Underwritten Base Rent is based on contractual rents as of April 22, 2015 and rent steps through May 31, 2016. | ||
(3) | Underwritten Vacancy & Credit Loss includes vacancy loss and rent abatements. |
■ | Appraisal.According to the appraisal dated as of March 23, 2015, the Dallas Market Center Property had an “as-is” appraised value of $403,000,000. |
■ | Environmental Matters. According to a Phase I environmental report dated April 24, 2015, there are no recognized environmental conditions or recommendations for further action at the Dallas Market Center Property other than the maintenance of an operations and maintenance plan for asbestos. |
B-58 |
DALLAS MARKET CENTER |
■ | Market Overview and Competition. The Dallas Market Center Property is located about two miles northwest of the Dallas CBD, approximately two miles southeast of Dallas Love Field airport, and 12 miles east of Dallas/Fort Worth International Airport, in a district locally referred to as the Stemmons Freeway Corridor. The Dallas Market Center Property is accessible via Oak Lawn Avenue, Mockingbird Lane, the Northwest Highway and Irving Boulevard, which all provide direct access to and from Stemmons Freeway. The Dallas North Tollway is located three blocks from the Dallas Market Center Property and provides access to the Dallas CBD to the south and suburban locales in Collin County to the north. The Dallas Area Rapid Transit (“DART”) provides rail and bus services adjacent to the Dallas Market Center Property. |
According to the appraisal, the U.S. Census Bureau estimates that the Dallas-Fort Worth-Arlington MSA was the fastest growing metro area in the country over the past 10 years. The population has grown by over 25%, or 1.5 million people, since 2000. The area is forecasted to have an average of 3.0% of job growth year over year through 2018. The Dallas-Fort Worth region is among the top six metropolitan areas in the country for large corporate headquarters, including Toyota North America, Exxon Mobil Corporation, AT&T and Southwest Airlines.
The Dallas Market Center Property is considered to compete most directly with the trade marts found in Atlanta, Las Vegas, Los Angeles and New York.
The following table presents certain information relating to the primary competition for the Dallas Market Center:
Competitive Set(1)
Dallas Market Center | AmericasMart | Atlanta Decorative Arts Center | Decoration and Design Building | The New Mart | New York Design Center | World Market Center | ||||||||
Location | Dallas, TX | Atlanta, GA | Atlanta, GA | New York, NY | Los Angeles, CA | New York, NY | Las Vegas, NV | |||||||
Property Type | Trade Mart | Trade Mart | Trade Mart | Trade Mart | Trade Mart | Trade Mart | Trade Mart | |||||||
Year Built/Renovated | 1957/1964 | 1957/NAP | 1960/1984 | 1960/NAP | 1928/1997 | 1926/1981 | 2005/2008 | |||||||
Total GLA | 3,101,772 | 4,200,000 | 500,000 | 584,000 | 253,000 | 500,000 | 4,098,248 | |||||||
Total Occupancy | 88.3% | 98% | 99% | 100% | 100% | 100% | 78% | |||||||
Merchandise Lines | Home Décor, Apparel, Gifts, Lighting | Home Furnishings, Gifts, Apparel | Home Furnishings, Accessories | Home Furnishings, Accessories | Apparel, Furnishings, Gifts | Home Furnishings, Accessories | Furniture, Gifts, Home Décor |
(1) | Source: Appraisal. |
■ | The Borrower. The borrower is WTC-Trade Mart 2015, L.P., a single-purpose, single-asset entity. Legal counsel to the borrower delivered a non-consolidation opinion in connection with the origination of the Dallas Market Center Loan. Dallas Market Center Financial, L.L.C. is the non-recourse carveout guarantor under the Dallas Market Center Loan. The borrower is indirectly owned by Crow Family Partnership, L.P., which has a substantial stake in the ownership of various businesses, both real estate and non-real estate related, in the United States, Europe and South America. Crow Family Partnership, L.P. owns and manages the capital of the Trammell Crow family, who has had ownership in the Dallas Market Center Property for more than 55 years and is the original developer of the Dallas Market Center Property. |
■ | Escrows.On the origination date of the Dallas Market Center Loan, the borrower funded escrow reserves in the amount of (i) $439,167 for real estate taxes, (ii) $47,500 for insurance premiums, (iii) $1,500,000 for tenant improvements and leasing commissions and (iv) $910,580 for replacement reserves. |
In addition, on each due date, the borrower will be required to fund (i) a tax reserve equal to one-twelfth of the amount that the lender reasonably estimates will be necessary to pay taxes over the then succeeding 12-month period, (ii) an insurance reserve equal to one-twelfth of the amount that the lender reasonably estimates will be necessary to pay the insurance premiums over the then succeeding 12-month period, (iii) a tenant improvements and leasing commissions reserve in an amount equal to $125,000 (capped at $1,500,000) and (iv) a replacement reserve in an amount equal to $125,000 (capped at $910,580).
However, the borrower will not be required to fund a reserve in respect of insurance premiums so long as (i) no event of default under the Dallas Market Center Loan has occurred or is continuing, (ii) the borrower maintains the required insurance under one or more blanket policies and (iii) the borrower delivers evidence reasonably acceptable to the lender that the insurance premiums have been paid.
■ | Lockbox and Cash Management. The Dallas Market Center Loan is structured with a hard lockbox and in place cash management. The related loan documents require the borrower to direct tenants to pay rent directly to a lender-controlled lockbox account. All amounts in the lockbox account will be swept weekly to the lender-controlled cash management account. On a weekly basis, other than during a Dallas Market Center Trigger |
B-59 |
DALLAS MARKET CENTER |
Period or an event of default under the Dallas Market Center Loan, all amounts on deposit in the cash management account in excess of the amounts required to be paid to or reserved with the lender on the next due date will be swept into a borrower-controlled operating account. On each due date during a Dallas Market Center Trigger Period or, at the lender’s discretion, during an event of default under the Dallas Market Center Loan, the related loan documents require that all amounts on deposit in the cash management account be used to pay debt service, required reserves and (other than during an event of default) operating expenses, and all remaining amounts be reserved in an excess cash flow reserve account. On each due date during which no Dallas Market Center Trigger Period or event of default is continuing, the related loan documents require that all amounts on deposit in the cash management account, after the payment of debt service and required reserves, be swept into a borrower-controlled operating account. During the continuance of an event of default under the Dallas Market Center Loan, the lender may apply all funds on deposit in any of the accounts constituting collateral for the Dallas Market Center Loan to amounts payable under the related loan documents and/or toward the payment of expenses of the Dallas Market Center Property, in such order of priority as the lender may determine. |
A “Dallas Market Center Trigger Period” means (i) any period commencing from the conclusion of any 12-month period (ending on the last day of a fiscal quarter) during which the net operating income (as calculated under the related loan documents) is less than $25,312,000, and ending at the conclusion of the second of any two 12-month periods thereafter during each of which the net operating income is equal to or greater than $25,312,000 and (ii) the period commencing upon the borrower’s failure to deliver monthly, quarterly or annual financial reports (subject to certain notice and cure rights) and ending when such financial reports are delivered and they indicate that no Dallas Market Center Trigger Period under clause (i) above has commenced and is continuing.
■ | Property Management. The Dallas Market Center Property is managed by Market Center Management Company, Ltd. pursuant to a management agreement. Under the related loan documents, the Dallas Market Center Property must remain managed by Market Center Management Company, Ltd. or any other management company approved by the lender and with respect to which a Rating Agency Confirmation has been received. The lender has the right to terminate, or require the borrower to terminate, the property manager and to replace them with a property manager selected by the lender (i) during the continuance of an event of default under the Dallas Market Center Loan, (ii) following any foreclosure, conveyance in lieu of foreclosure or other similar transaction, (iii) during the continuance of a material default by the property manager under the management agreement (after the expiration of any applicable notice and/or cure periods), (iv) if the property manager files for, or is the subject of a petition in, bankruptcy or (v) if a trustee or receiver is appointed for the property manager’s assets or the property manager makes an assignment for the benefit of its creditors or is adjudicated insolvent, provided, any replacement property manager will be selected by the borrower and approved by the lender (provided that in the event of default, any such replacement property manager will be selected by the lender). |
B-60 |
DALLAS MARKET CENTER |
■ | Ground Lease.The Dallas Market Center Property is subject to four ground leases that mature between 2055 and 2057. An affiliate of the borrower (and a mortgagor under the Dallas Market Center Loan) acquired the fee simple interest under all of the ground leases between 2004 and 2005 and is the fee owner of the land and the lessor under the ground leases. The ground lessors under each ground lease have confirmed, among other things, that (i) there are no defaults under the ground lease, (ii) the ground lessor consents to the interest of the ground lessee being encumbered by the mortgage, (iii) the lender is entitled to notice of any defaults under the ground lease and no notice of default or termination is effective unless such notice is given to the lender, (iv) the ground lease is assignable to the lender and its successors and assigns without the consent of the lessor thereunder, and in the event it is so assigned, it is further assignable by the holder of the Dallas Market Center Loan and its successors and assigns without the consent of the lessor and (v) the ground lease is not subject to any interests or encumbrances superior to the mortgage, except for the related fee interest of the fee owner and permitted encumbrances, as defined under the related loan documents. In addition, the ground lease does not restrict the use of the Dallas Market Center Property by the borrower in a manner that would adversely affect the mortgage. |
■ | Mezzanine or Secured Subordinate Indebtedness. Not permitted. |
■ | Future Indebtedness. The borrower is permitted under the Dallas Market Center Loan to accept unsecured loans made by the borrower’s partners to the borrower in accordance with the terms of the borrower’s organizational documents and not exceeding $15,000,000 in the aggregate, provided that each such loan is required to be subject to the terms of a subordination and standstill agreement in a form acceptable to the lender of the Dallas Market Center Loan and to be entered into by the applicable holder of such loan in favor of the lender of the Dallas Market Center Loan. |
■ | Terrorism Insurance. So long as TRIPRA or a similar or subsequent statute is in effect, the borrower is required to maintain terrorism insurance for foreign and domestic acts (as those terms are defined in TRIPRA or a similar or subsequent statute) in an amount equal to the full replacement cost of the Dallas Market Center Property (plus 18 months of rental loss and/or business interruption coverage and containing an extended period of indemnity endorsement covering the 12-month period commencing on the date on which the Dallas Market Center Property has been restored). If TRIPRA or a similar or subsequent statute is not in effect, then provided that terrorism insurance is commercially available, the borrower will be required to carry terrorism insurance throughout the term of the Dallas Market Center Loan as described in the preceding sentence, but will not be required to spend more than two times the amount of the insurance premium that is payable at that time in respect of the property and business interruption/rental loss insurance required under the related loan documents (without giving effect to the cost of terrorism and earthquake components of such property and business interruption/rental loss insurance), and if the cost of terrorism insurance exceeds such amount, then the borrower will be required to purchase the maximum amount of terrorism insurance available with funds equal to such amount. In either such case, terrorism insurance may not have a deductible in excess of $50,000. The required terrorism insurance may be included in a blanket policy, provided that the borrower provides evidence satisfactory to the lender that the insurance premiums for the Dallas Market Center Property are separately allocated to the Dallas Market Center Property and that the policy will provide the same protection as a separate policy. See “Risk Factors—Terrorism Insurance May Not Be Available for All Mortgaged Properties” in the Prospectus Supplement. |
B-61 |
PASADENA OFFICE TOWER |
B-62 |
PASADENA OFFICE TOWER |
B-63 |
PASADENA OFFICE TOWER |
B-64 |
PASADENA OFFICE TOWER |
Mortgaged Property Information | Mortgage Loan Information | |||||
Number of Mortgaged Properties | 1 | Loan Seller | CGMRC | |||
Location (City/State) | Pasadena, California | Cut-off Date Principal Balance | $42,000,000 | |||
Property Type | Office | Cut-off Date Principal Balance per SF | $295.84 | |||
Size (SF) | 141,969 | Percentage of Initial Pool Balance | 5.8% | |||
Total Occupancy as of 5/21/2015 | 93.3% | Number of Related Mortgage Loans | None | |||
Owned Occupancy as of 5/21/2015 | 93.3% | Type of Security | Fee Simple | |||
Year Built / Latest Renovation | 1970 / 2011 | Mortgage Rate | 4.1300% | |||
Appraised Value | $56,850,000 | Original Term to Maturity (Months) | 120 | |||
Original Amortization Term (Months) | 360 | |||||
Original Interest Only Period (Months) | 72 | |||||
Underwritten Revenues | $5,965,443 | |||||
Underwritten Expenses | $1,793,043 | Escrows | ||||
Underwritten Net Operating Income (NOI) | $4,172,400 | Upfront | Monthly | |||
Underwritten Net Cash Flow (NCF) | $3,966,835 | Taxes | $134,853 | $26,971 | ||
Cut-off Date LTV Ratio | 73.9% | Insurance | $28,498 | $3,562 | ||
Maturity Date LTV Ratio | 68.6% | Replacement Reserve | $0 | $2,366 | ||
DSCR Based on Underwritten NOI / NCF | 1.71x / 1.62x | TI/LC(1) | $550,000 | $14,167 | ||
Debt Yield Based on Underwritten NOI / NCF | 9.9% / 9.4% | Other(2) | $601,939 | $0 |
Sources and Uses | |||||||||
Sources | $ | % | Uses | $ | % | ||||
Loan Amount | $42,000,000 | 99.9 | % | Loan Payoff | $29,464,773 | 70.1 | % | ||
Other Sources | 38,500 | 0.1 | Principal Equity Distribution | 10,972,359 | 26.1 | ||||
Reserves | 1,315,290 | 3.1 | |||||||
Closing Costs | 286,078 | 0.7 | |||||||
Total Sources | $42,038,500 | 100.0 | % | Total Uses | $42,038,500 | 100.0 | % |
(1) | The TI/LC reserve is capped at $450,000. See“— Escrows” below. |
(2) | Other upfront reserves represent a free rent reserve of $411,490, an unfunded obligation reserve of $157,949 and an immediate repairs reserve of $32,500. See“— Escrows” below. |
n | The Mortgage Loan. The mortgage loan (the “Pasadena Office Tower Loan”) is evidenced by a note in the original principal amount of $42,000,000 and is secured by a first mortgage encumbering the borrowers’ fee simple interest in an office building and parking facility located in Pasadena, California (the“Pasadena Office Tower Property”). The Pasadena Office Tower Loan was originated by Citigroup Global Markets Realty Corp. on May 28, 2015 and represents approximately 5.8% of the Initial Pool Balance. The note evidencing the Pasadena Office Tower Loan has an outstanding principal balance as of the Cut-off Date of $42,000,000 and accrues interest at an interest rate of 4.1300%per annum. The proceeds of the Pasadena Office Tower Loan were used to refinance existing debt on the Pasadena Office Tower Property, fund reserves, pay origination costs and return equity to the borrowers. |
The Pasadena Office Tower Loan had an initial term of 120 months and has a remaining term of 119 months as of the Cut-off Date. The Pasadena Office Tower Loan requires interest only payments on each due date through and including the due date occurring in June 2021 and thereafter requires payments of interest and principal based on a 30-year amortization schedule. The scheduled maturity date of the Pasadena Office Tower Loan is the due date in June 2025. On or after the due date occurring in August 2017, the borrowers may voluntarily prepay the Pasadena Office Tower Loan in whole (but not in part), provided that, if any such prepayment occurs prior to the due date occurring in February 2025, the borrowers will be required to pay a prepayment premium equal to the greater of (x) a yield maintenance premium and (y) an amount equal to 1% of the amount being prepaid. On or after the due date occurring in February 2025, the borrowers will be permitted to prepay the Pasadena Office Tower Loan in whole (but not in part) without payment of a prepayment premium or penalty.
B-65 |
PASADENA OFFICE TOWER |
n | The Mortgaged Property. The Pasadena Office Tower Property is a 9-story multi-tenant office building containing 141,969 SF of net rentable area and an adjacent 778-stall parking structure located in Pasadena, California. The office improvements are located at the southeast corner of South Los Robles Avenue and El Dorado Streets, while the parking structure is located along the west side of South Oakland Avenue and is bounded by El Dorado Street to the north and Cordova Street to the south. The 778-stall parking structure is collateral for the Pasadena Tower Property Loan, is leased to United Valet Parking, Inc. (680 spaces) and is subject to a recorded parking agreement whereby a Hilton hotel adjacent to the Pasadena Office Tower Property pays an annual fee for the use of one floor of the parking structure (98 spaces). The Pasadena Office Tower Property was constructed in 1970 on a 2.12-acre site and underwent renovations in 2011. As of May 21, 2015, the Pasadena Office Tower Property was 93.3% leased to 31 tenants. |
The following table presents certain information relating to the major tenants at the Pasadena Office Tower Property:
Ten Largest Office Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating (Fitch/Moody’s/S&P)(1) | Tenant GLA | % of GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | Lease Expiration | Renewal / Extension Options | ||||||||||||
City of Pasadena | AA / NR / AA- | 24,627 | 17.3 | % | $756,541 | 19.8 | % | $30.72 | 9/30/2016 | 3, 2-year options | ||||||||||
Iolo Technologies LLC(2) | NR / NR / NR | 15,821 | 11.1 | 410,650 | 10.8 | 25.96 | 12/31/2021 | 1, 5-year option | ||||||||||||
California Dept. of Rehab. (3) | NR / NR / NR | 7,839 | 5.5 | 264,564 | 6.9 | 33.75 | 8/31/2017 | NA | ||||||||||||
Trend Micro Inc. | NR / NR / NR | 8,044 | 5.7 | 233,487 | 6.1 | 29.03 | 10/31/2016 | 2, 3-year options | ||||||||||||
MetLife | A- / A3 / A- | 7,786 | 5.5 | 226,090 | 5.9 | 29.04 | 6/30/2017 | 1, 5-year option | ||||||||||||
Pasadena Community Access | AA / NR / AA- | 7,287 | 5.1 | 192,087 | 5.0 | 26.36 | 8/31/2020 | 1, 5-year option | ||||||||||||
Wai & Connor LLP | NR / NR / NR | 5,096 | 3.6 | 143,080 | 3.8 | 28.08 | 11/30/2017 | 1, 3-year option | ||||||||||||
YC Rubber Co. (N. America) | NR / NR / NR | 4,518 | 3.2 | 135,540 | 3.6 | 30.00 | 1/31/2020 | 1, 3-year option | ||||||||||||
Evolution Design lab, Inc. | NR / NR / NR | 4,092 | 2.9 | 120,633 | 3.2 | 29.48 | 11/30/2016 | 1, 5-year option | ||||||||||||
Competition Economics LLC | NR / NR / NR | 3,887 | 2.7 | 115,496 | 3.0 | 29.71 | 5/31/2017 | 1, 2-year option | ||||||||||||
Ten Largest Tenants | 88,997 | 62.7 | % | $2,598,168 | 68.1 | % | $29.19 | |||||||||||||
Remaining Tenants | 43,457 | 30.6 | 1,216,046 | 31.9 | 27.98 | |||||||||||||||
Vacant | 9,515 | 6.7 | 0 | 0.0 | 0.00 | |||||||||||||||
Total / Wtd. Avg. All Tenants | 141,969 | 100.0 | % | $3,814,213 | 100.0 | % | $28.80 |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. | |
(2) | Iolo Technologies LLC may terminate its lease by giving notice between January 1, 2020 and January 10, 2020; the lease termination will become effective within 180-270 days of Iolo Technologies LLC giving notice and upon payment of $284,000. Additionally, Iolo Technologies LLC may terminate its lease by giving notice between January 1, 2021 and January 10, 2021; the lease termination will become effective within 180-270 days of Iolo Technologies LLC giving notice and upon payment of $142,000. | |
(3) | The California Department of Rehabilitation may terminate its lease with 90 days’ notice. |
Parking Tenants Based on Underwritten Revenue
Tenant Name | Credit Rating (Fitch/Moody’s/S&P)(1) | # Parking Stalls Leased | % of Parking Stalls | UW Parking Revenue | % of Total UW Parking Revenue | Lease Expiration | Renewal / Extension Options | |||||||||||
United Valet Parking, Inc. | NR / NR / NR | 680 | 86.3 | % | $1,671,072 | 83.5 | % | 9/30/2019 | NA | |||||||||
Hilton Interproperty(2) | NR / NR / NR | 98 | 13.7 | 330,420 | 16.5 | 3/31/2099 | NA | |||||||||||
Total / Wtd. Avg. | 778 | 100.0 | % | $2,001,592 | 100.0 | % |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. | |
(2) | Hilton Interproperty may terminate its parking agreement upon 90 days’ notice. |
B-66 |
PASADENA OFFICE TOWER |
The following table presents the lease rollover schedule at the Pasadena Office Tower Property, based on initial lease expiration dates:
Lease Expiration Schedule(1)(2)(3)
Year Ending December 31, | Expiring Owned GLA | % of Owned GLA | Cumulative % of Owned GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | # of Expiring Spaces | ||||||||||||||
MTM | 2,113 | 1.5 | % | 1.5 | % | $54,362 | 1.4 | % | $25.73 | 8 | |||||||||||
2015 | 0 | 0.0 | 1.5 | % | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2016 | 43,834 | 30.9 | 32.4 | % | 1,313,799 | 34.4 | 29.97 | 12 | |||||||||||||
2017 | 34,922 | 24.6 | 57.0 | % | 1,054,182 | 27.6 | 30.19 | 10 | |||||||||||||
2018 | 5,806 | 4.1 | 61.1 | % | 168,406 | 4.4 | 29.01 | 2 | |||||||||||||
2019 | 6,090 | 4.3 | 65.3 | % | 170,528 | 4.5 | 28.00 | 5 | |||||||||||||
2020 | 19,343 | 13.6 | 79.0 | % | 553,737 | 14.5 | 28.63 | 6 | |||||||||||||
2021 | 15,821 | 11.1 | 90.1 | % | 410,650 | 10.8 | 25.96 | 1 | |||||||||||||
2022 | 3,088 | 2.2 | 92.3 | % | 88,549 | 2.3 | 28.68 | 1 | |||||||||||||
2023 | 0 | 0.0 | 92.3 | % | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2024 | 0 | 0.0 | 92.3 | % | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2025 | 0 | 0.0 | 92.3 | % | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2026 & Thereafter | 1,437 | 1.0 | 93.3 | % | 0 | 0.0 | 0.00 | 2 | |||||||||||||
Vacant | 9,515 | 6.7 | 100.0 | % | 0 | 0.0 | 0.00 | 0 | |||||||||||||
Total / Wtd. Avg. | 141,969 | 100.0 | % | $3,814,213 | 100.0 | % | $28.80 | 47 |
(1) | Calculated based on approximate square footage occupied by each Owned Tenant. | |
(2) | Certain tenants have lease termination options that are exercisable prior to the originally stated expiration date of the applicable lease and that are not considered in the Lease Expiration Schedule. | |
(3) | Several tenants occupy multiple spaces within the Pasadena Office Tower Property and portions of the tenant’s space have lease expirations at different dates. As such, each space is treated as a separate tenant in the chart above. |
The following table presents certain information relating to historical leasing at the Pasadena Office Tower Property:
Historical Leased %(1)
2012 | 2013 | 2014 | As of 5/21/2015 | |||||
Owned Space | 73.9% | 76.9% | 90.5% | 93.3% |
(1) | As provided by the borrowers and which represents average occupancy for the specified year unless otherwise indicated. |
B-67 |
PASADENA OFFICE TOWER |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Pasadena Office Tower Property: |
Cash Flow Analysis(1)
2012 | 2013 | 2014 | TTM 3/31/2015 | Underwritten | Underwritten $ per SF | |||||||||||
Base Rent(2) | $2,898,998 | $2,775,880 | $2,963,592 | $3,043,899 | $3,536,608 | $24.91 | ||||||||||
Contractual Rent Steps(3) | 0 | 0 | 0 | 0 | 277,605 | 1.96 | ||||||||||
Gross Up Vacancy | $0 | 0 | 0 | 0 | 273,140 | 1.92 | ||||||||||
Total Rent | $2,898,998 | $2,775,880 | $2,963,592 | $3,043,899 | $4,087,353 | $28.79 | ||||||||||
Total Reimbursables | 93,485 | 111,874 | 114,759 | 123,152 | 174,853 | 1.23 | ||||||||||
Parking Income(4) | 1,632,281 | 1,655,295 | 1,694,040 | 1,723,590 | 2,001,592 | 14.10 | ||||||||||
Other Income | 2,710 | 75,481 | 4,058 | 4,125 | 0 | 0.00 | ||||||||||
Percentage Rent | 0 | 0 | 0 | 0 | 0 | 0.00 | ||||||||||
Vacancy & Credit Loss | 0 | 0 | 0 | 0 | (298,354 | ) | (2.10 | ) | ||||||||
Effective Gross Income | $4,627,474 | $4,618,529 | $4,776,448 | $4,894,766 | $5,965,443 | $42.02 | ||||||||||
Real Estate Taxes | $312,305 | $466,600 | $154,118 | $308,235 | $314,400 | $2.21 | ||||||||||
Insurance | 127,314 | 37,880 | 37,221 | 45,178 | 40,711 | 0.29 | ||||||||||
Management Fee | 52,589 | 51,572 | 54,559 | 56,034 | 238,618 | 1.68 | ||||||||||
Other Operating Expenses | 998,253 | 1,086,840 | 1,173,291 | 1,165,667 | 1,199,314 | 8.45 | ||||||||||
Total Operating Expenses | $1,490,461 | $1,642,892 | $1,419,188 | $1,575,114 | $1,793,043 | $12.63 | ||||||||||
Net Operating Income | $3,137,013 | $2,975,637 | $3,357,260 | $3,319,652 | $4,172,400 | $29.39 | ||||||||||
TI/LC | 0 | 0 | 0 | 0 | 177,172 | 1.25 | ||||||||||
Replacement Reserves | 0 | 0 | 0 | 0 | 28,394 | 0.20 | ||||||||||
Net Cash Flow | $3,137,013 | $2,975,637 | $3,357,260 | $3,319,652 | $3,966,835 | $27.94 |
(1) | Certain items such as straight line rent, interest expense, interest income, lease cancellation income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. | |
(2) | The $492,709 increase in Base Rent between TTM 3/31/2015 and Underwritten is primarily attributed to a new lease to Iolo Technologies LLC which commenced on August 18, 2014 ($398,689) and the expiration of free rent periods for certain tenants at the Pasadena Office Tower Property. | |
(3) | Contractual rent steps are underwritten based on actual scheduled rent increases through April 1, 2016. | |
(4) | United Valet Parking, Inc. leases 680 parking spaces at a current rental rate of $1,622,400, which increases to $1,671,072 on October 1, 2015 and has 3% annual rent increases thereafter. The United Valet Parking, Inc. lease expires September 30, 2019. The adjacent Hilton hotel leases 98 parking spaces at a current rental rate of $320,796. The adjacent Hilton hotel lease expires March 31, 2099. |
n | Appraisal.According to the appraisal, the Pasadena Office Tower Property had an “as-is” appraised value of $56,850,000 as of April 16, 2015. |
n | Environmental Matters.Based on the Phase I environmental report dated April 14, 2015, there were no recommendations for further action for the Pasadena Office Tower Property other than the continuation of an operations and maintenance plan for asbestos, which was in place at origination of the Pasadena Office Tower Loan. |
n | Market Overview and Competition. The Pasadena Office Tower Property is located in Pasadena, California, approximately 10 miles northeast of downtown Los Angeles. Pasadena is served by several major freeways including I-210 (Foothill Freeway; east/west), CA-134 (Ventura Freeway; east/west), I-710 (Long Beach Freeway; north/south), and CA-110 (Pasadena Freeway; north/south). According to the U.S. Bureau of Labor Statistics, the March 2015 unemployment rate of Pasadena was 6.4%. Major employers within the City of Pasadena include Jet Propulsion Laboratory (5,200 employees), CA Institute of Technology (3,600 employees), Huntington Memorial Hospital (3,000 employees), SBC (2,525 employees) and Pasadena City College (2,200 employees). The 2015 population within a one-, three-, and five-mile radius are 36,267, 329,420, and 972,414, respectively. The 2015 average household income within a one-, three-, and five-mile radius are $66,155, $82,337, and $77,757, respectively. |
B-68 |
PASADENA OFFICE TOWER |
The Pasadena Office Tower Property lies within the Pasadena submarket, within the greater Tri-Cities/Glendale submarket of Los Angeles. The Pasadena submarket contains 9,314,468 SF of space that exhibited a vacancy rate of 13.8% and an average asking rent of $31.92 per SF as of the fourth quarter of 2014.
Based on recent lease comparables, the appraiser concluded to an average annual rental rate of $30.00 per SF for the office space.
The following table presents certain information relating to certain office lease comparables provided in the appraisal for the Pasadena Office Tower Property:
Office Lease Comparables(1)
| Pasadena Office Tower | 199 South Los Robles | 200 South Los Robles | 2 North Lake | Koll Center Pasadena | 201 South Lake | ||||||
Year Built | 1970 | 1983 | 1988 | 1985 | 2001 | 2001 | ||||||
Total GLA | 141,969 | 163,234 | 130,818 | 203,911 | 175,840 | 133,380 | ||||||
Size | NA | 3,404–11,013 | 1,159–6,703 | 983–7,254 | 1,633-9,862 | 1,587–2,251 | ||||||
Quoted Rent per SF | $29.20 (Wtd. Avg.) | $30.00–$33.00(2) | $33.00 | $31.92–$33.00(2) | $31.20–$33.60(2) | $34.20–$36.00(2) | ||||||
Expense Basis | Full Service | Full Service | Full Service | Full Service | Full Service | Full Service |
(1) | Source: Appraisal. | |
(2) | Based on recent signed leases. |
n | The Borrower. The borrowers of the Pasadena Office Tower Loan are Sherman Oaks Capital Associates, LP and Pasadena Holdings, LLC. The borrowers own the Pasadena Office Tower Property as tenants-in-common, but have waived their respective rights to partition. See “Risk Factors—The Borrower’s Form of Entity May Cause Special Risks” in the Prospectus Supplement. The non-recourse carveout guarantors under the Pasadena Office Tower Loan are Albert Taban and Michael Pashaie. |
Albert Taban and Michael Pashaie are both Los Angeles-based commercial real estate owners/operators with holdings primarily in southern California. Albert Taban is a principal of Jade Enterprises, a real estate investment firm that owns over 40 properties. Michael Pashaie is a co-founder of Golden West Properties, a real estate investment and development company that owns 47 properties, 36 of which are located in Los Angeles.
n | Escrows. In connection with the origination of the Pasadena Office Tower Loan, the borrowers funded aggregate reserves of $1,315,290 with respect to the Pasadena Office Tower Property, comprised of: (i) $134,853 for real estate taxes; (ii) $28,498 for insurance premiums; (iii) $32,500 for deferred maintenance; (iv) $411,490 for unfunded obligations related to free rent of various tenants at the Pasadena Office Tower Property; (v) $550,000 for general tenant improvements and leasing commissions; and (vi) $157,949 for tenant improvements and leasing commissions associated with the Edelman Financial Services, LLC space and the Qless, Inc space. |
Additionally, on each due date, the borrowers are required to fund the following reserves with respect to the Pasadena Office Tower Property: (i) a tax reserve in an amount equal to one-twelfth of the amount that the lender estimates will be necessary to pay taxes over the then succeeding 12-month period; (ii) an insurance reserve in an amount equal to one-twelfth of the amount the lender estimates will be necessary to pay the insurance premiums over the then succeeding 12-month period; (iii) a replacement reserve in the amount of $2,366; and (iv) a tenant improvements and leasing commissions reserve (“TI/LC Reserve”) in the amount of $14,167, subject to a cap of $450,000. On the due date occurring in January 2018, to the extent the TI/LC Reserve balance exceeds $170,000, the lender will disburse to the borrowers the amount of TI/LC Reserve funds that is in excess of $170,000 such that the balance of the TI/LC Reserve will be $170,000 on such due date.
B-69 |
PASADENA OFFICE TOWER |
n | Lockbox and Cash Management.The Pasadena Office Tower Loan is structured with a springing lockbox and springing cash management. During the continuance of an Pasadena Office Tower Trigger Period, the related borrowers are required to direct tenants to pay rent directly to a lender-controlled lockbox account and all sums on deposit in the lockbox account are required to be swept on a daily basis into a cash management account for the payment of, among other things, debt service, funding of monthly escrows and property operating expenses, with any excess to be held by the lender as additional security for the Pasadena Office Tower Loan. |
A “Pasadena Office Tower Trigger Period” means the period: (A) commencing upon the earliest of (i) the occurrence and continuance of an event of default and (ii) the debt service coverage ratio being less than 1.15x; and (B) expiring upon (x) with regard to any Pasadena Office Tower Trigger Period commenced in connection with clause (i) above, the cure (if applicable) of such event of default and (y) with regard to any Pasadena Office Tower Trigger Period commenced in connection with clause (ii) above, the date that the debt service coverage ratio is equal to or greater than 1.20x for two consecutive calendar quarters.
n | Property Management. The Pasadena Office Tower Property is currently managed by Morlin Asset Management, L.P. pursuant to a management agreement. Under the Pasadena Office Tower Loan documents, the borrowers may terminate and replace the property manager so long as (i) no event of default is continuing under the Pasadena Office Tower Loan, (ii) the lender receives at least 60 days’ prior written notice, (iii) the replacement would not cause, without the lender’s prior written consent, directly or indirectly, any termination right, right of first refusal, right of first offer or any other similar right to be exercisable, any termination fees to be due, or a material adverse effect to occur under the REA (Parking Easement and Agreement with respect to the parking facility) and (iv) the replacement property manager and replacement management agreement are approved by the lender in writing (which approval may be conditioned upon the lender’s receipt of a Rating Agency Confirmation). The lender has the right to terminate the management agreement and replace the property manager or require that the borrowers terminate the management agreement and replace the property manager if: (a) the property manager becomes insolvent or a debtor in (i) any involuntary bankruptcy or insolvency proceeding that is not dismissed within ninety (90) days of the filing thereof or (ii) any voluntary bankruptcy or insolvency proceeding; (b) a Pasadena Office Tower Trigger Period is continuing; (c) the property manager has engaged in gross negligence, fraud, willful misconduct or misappropriation of funds; or (d) there exists a default under the management agreement by the property manager beyond all applicable notice and cure periods. |
n | Mezzanine or Subordinate Indebtedness. Not permitted. |
n | Condominium and Release. The borrowers may give the lender 90 days’ notice, given not sooner than 60 days after the securitization Closing Date to subdivide the Pasadena Office Tower Property into a parcel containing the office building and a parcel containing the parking facility and to subject the parking facility parcel to a condominium, subject to the satisfaction of certain conditions, including that: (i) no event of default is continuing under the Pasadena Office Tower Loan; (ii) the borrowers have provided, if required by the lender, REMIC opinions and a Rating Agency Confirmation with respect to the subdivision and condominium; and (iii) the borrowers have delivered condominium documents acceptable to the lender. The condominium documents will create a condominium consisting of two units, one consisting of the parking facility improvements and the other consisting of the airspace above the parking facility (the “Release Unit”). |
B-70 |
PASADENA OFFICE TOWER |
If all conditions to the subdivision of the Pasadena Office Tower Property and establishment of the condominium are satisfied in accordance with the Pasadena Office Tower Loan documents, the borrowers may transfer the Release Unit to an affiliate and release the Release Unit from the liens of the Pasadena Office Tower Loan documents, provided that certain conditions are satisfied, including that: (i) no event of default is continuing under the Pasadena Office Tower Loan on either the date the release request is received by the lender or on the date of the proposed release; (ii) if required by the lender, the borrowers have delivered a REMIC opinion and a Rating Agency Confirmation with respect to the release; and (iii) immediately after the release of the Release Unit, either (x) the ratio of the outstanding principal amount of the Pasadena Office Tower Loan to the value of the Pasadena Office Tower Property excluding the Release Unit is equal to or less than 125% or (y) the principal balance of the Pasadena Office Tower Loan is paid down by an amount such that the loan-to-value ratio does not increase after the release of the Release Unit, but in no event shall such paydown of the Pasadena Office Tower Loan be in an amount less than an amount necessary to keep the loan-to-value ratio of the remaining Pasadena Office Tower Property equal to or less than 125%, unless the lender receives an opinion of counsel that if the amount in (y) is not paid, the REMIC Trust will not fail to maintain its status as a REMIC Trust as a result of the release.
n | Development of Release Unit. If the Release Unit is released as described in “—Condominium and Release” above, the owner of the Release Unit may, upon 90 days’ notice given not sooner than 60 days following origination of the Pasadena Office Tower Loan, construct multifamily dwelling units in the Release Unit, subject to certain conditions, including that: (i) no event of default is continuing under the Pasadena Office Tower Loan; (ii) the plans and specifications for the development are reasonably acceptable to the lender and the owner of the Release Unit has provided completion schedules, evidence of the acquisition of all necessary consents and permits and compliance with applicable law; (iii) the lender has determined that the development will not have a material adverse effect on the use of or any tenants of the Pasadena Office Tower Property, result in or give rise to a default or right of abatement under or the termination of any leases, result in or give rise to a default under or termination of the reciprocal easement agreement affecting the Pasadena Office Tower Property, or render any of the existing improvements unusable during the completion of the development (except for temporary unavailability of portions of the parking facility as is reasonably necessary during development provided that the temporary unavailability does not give rise to any defaults under any of the leases, the reciprocal easement agreement or any other legal requirement); (iv) the borrowers do not incur any indebtedness as part of the development; (v) the owner of the Release Unit delivers a completion bond or cash or a letter of credit in the amount of 125% of the estimated cost of the development; and (vi) if required by the lender, the borrowers deliver a REMIC opinion and a Rating Agency Confirmation with respect to the development. |
n | Terrorism Insurance. The borrowers are required to maintain (x) an “all-risk” insurance policy that provides coverage for terrorism in an amount equal to the full replacement cost of the Pasadena Office Tower Property and (y) business interruption coverage with no exclusion for terrorism covering no less than 18 months of business interruption coverage in an amount equal to 100% of the projected gross income from the Pasadena Office Tower Property (on an actual loss sustained basis) for a period continuing until the restoration of the Pasadena Office Tower Property is completed, and containing an extended period endorsement which provides for up to six months of additional coverage. The “all-risk” policy containing terrorism insurance is required to contain a deductible that is no higher than $10,000. If TRIPRA or a similar or subsequent statute is not in effect, the borrowers are required to carry terrorism insurance throughout the term of the Pasadena Office Tower Loan, but, in such event, the borrowers are not required to spend on terrorism insurance coverage more than two times the amount of the insurance premium that is payable at such time in respect of the property and business interruption/rental loss insurance required (without giving effect to the cost of the terrorism component of such property and business interruption/rental loss insurance), and if the cost of terrorism insurance exceeds such amount, the borrowers must purchase the maximum amount of terrorism insurance available with funds equal to such amount. See “Risk Factors—Terrorism Insurance May Not Be Available for All Mortgaged Properties” in the Prospectus Supplement. |
B-71 |
ST. ANTHONY’S HEALTHPLEX NORTH |
B-72 |
ST. ANTHONY’S HEALTHPLEX NORTH |
B-73 |
ST. ANTHONY’S HEALTHPLEX NORTH |
B-74 |
ST. ANTHONY’S HEALTHPLEX NORTH |
Mortgaged Property Information | Mortgage Loan Information | ||||||
Number of Mortgaged Properties | 1 | Loan Seller | RAIT Funding, LLC | ||||
Location (City/State) | Oklahoma City, Oklahoma | Cut-off Date Principal Balance | $29,929,067 | ||||
Property Type | Office | Cut-off Date Principal Balance per SF | $309.03 | ||||
Size (SF) | 96,847 | Percentage of Initial Pool Balance | 4.1% | ||||
Total Occupancy as of 3/27/2015(1) | 84.8% | Number of Related Mortgage Loans | None | ||||
Total Owned Occupancy as of 3/27/2015(1) | 84.8% | Type of Security | Fee Simple | ||||
Year Built / Latest Renovation | 2015/NAP | Mortgage Rate | 3.9350% | ||||
Appraised Value | $43,000,000 | Original Term to Maturity (Months) | 120 | ||||
Original Amortization Term (Months) | 360 | ||||||
Original Interest Only Period (Months) | NAP | ||||||
Underwritten Revenues | $3,198,495 | ||||||
Underwritten Expenses | $459,280 | Escrows | |||||
Underwritten Net Operating Income (NOI) | $2,739,215 | Upfront | Monthly | ||||
Underwritten Net Cash Flow (NCF) | $2,671,522 | Taxes | $17,998 | $5,999 | |||
Cut-off Date LTV Ratio | 69.6% | Insurance | $16,009 | $4,002 | |||
Maturity Date LTV Ratio(2) | 55.1% | Replacement Reserves(4) | $0 | $1,614 | |||
DSCR Based on Underwritten NOI / NCF(3) | 1.68x / 1.64x | TI/LC | $0 | $4,027 | |||
Debt Yield Based on Underwritten NOI / NCF | 9.2% / 8.9% | Other(5) | $205,617 | $0 |
Sources and Uses | |||||||||
Sources | $ | % | Uses | $ | % | ||||
Loan Amount | $30,000,000 | 85.7 | % | Loan Payoff | $24,615,993 | 70.3 | % | ||
Mezzanine Loan Amount | 5,000,000 | 14.3 | Partnership Equity Distribution | 8,439,983 | 24.1 | ||||
Closing Costs | 1,704,400 | 4.9 | |||||||
Reserves | 239,624 | 0.7 | |||||||
Total Sources | $35,000,000 | 100.0 | % | Total Uses | $35,000,000 | 100.0 | % |
(1) | The St. Anthony’s Healthplex North Property is approximately 95.3% leased to seven tenants. Two tenants, Ancon Development Corporation and Miller Architects, Inc., each of which are borrower affiliates, are expected to take occupancy in June 2015 and September 2015, respectively, and a third tenant, Comprehensive Foot & Ankle Institute, PLLC, is expected to take occupancy in August 2015. |
(2) | The Maturity Date LTV Ratio is calculated using the “prospective market value upon stabilization” of $44,500,000. The Maturity Date LTV Ratio, calculated on the basis of the “as-is” appraised value of $43,000,000, is 57.0%. See “—Appraisal”below. |
(3) | The DSCR Based on Underwritten NOI / NCF is calculated using the St. Anthony’s Healthplex North Loan’s non-standard amortization schedule as set forth in Annex G to the Prospectus Supplement, and is calculated based on the aggregate debt service for the 12-month period commencing August 1, 2015. |
(4) | Replacement Reserves are capped at $58,108. See “—Escrows” below. |
(5) | Other upfront reserves include a construction reserve ($162,605) and an interest reserve funded under the St. Anthony’s Healthplex North Mezzanine Loan ($43,013). See “—Escrows” below. |
n | The Mortgage Loan. The mortgage loan (the “St. Anthony’s Healthplex North Loan”) is evidenced by a note in the original principal amount of $30,000,000 and is secured by a first mortgage encumbering the borrower’s fee simple interest in a Class A medical office building located in Oklahoma City, Oklahoma (the “St. Anthony’s Healthplex North Property”). The St. Anthony’s Healthplex North Loan was originated by RAIT Funding, LLC on April 3, 2015 and represents approximately 4.1% of the Initial Pool Balance. The note evidencing the St. Anthony’s Healthplex North Loan has an outstanding principal balance as of the Cut-off Date of $29,929,067 and has an interest rate of 3.9350%per annum. The proceeds of the St. Anthony’s Healthplex North Loan were primarily used to refinance existing debt on the St. Anthony’s Healthplex North Property, return equity to the borrower sponsors, pay origination costs and fund reserves. |
The St. Anthony’s Healthplex North Loan had an initial term of 120 months and has a remaining term of 118 months as of the Cut-off Date. The St. Anthony’s Healthplex North Loan requires monthly payments of interest and principal sufficient to amortize the St. Anthony’s Healthplex North Loan over a 30-year amortization schedule. The scheduled maturity date for the St. Anthony’s Healthplex North Loan is the due date in May 2025. Voluntary prepayment of the St. Anthony’s Healthplex North Loan without payment of any prepayment premium is permitted on or after the due date in February 2025. Provided that no event of default under the St. Anthony’s Healthplex North Loan is continuing, defeasance with direct, non-callable obligations of the United States of America is permitted at any time on or after the first due date following the second anniversary of the securitization Closing Date.
B-75 |
ST. ANTHONY’S HEALTHPLEX NORTH |
n | The Mortgaged Property. The St. Anthony’s Healthplex North Property is a 96,847 SF Class A medical office building, with a 24-hour emergency room facility, located on approximately 8 acres of land in Oklahoma City, Oklahoma County, Oklahoma. The St. Anthony’s Healthplex North Property is newly constructed with substantial completion achieved in February 2015. |
As of March 27, 2015, the St. Anthony’s Healthplex North Property was 84.8% leased to four tenants. The physical occupancy rate at the St. Anthony’s Healthplex North Property is expected to increase to approximately 95.3% by September 2015 after tenants Ancon Development Corporation and Miller Architects, Inc. (each of which are borrower affiliates) and Comprehensive Foot & Ankle Institute, PLLC are expected to take occupancy in June 2015, September 2015 and August 2015, respectively. Primary access to the St. Anthony’s Healthplex North Property neighborhood is provided by W. John Kilpatrick Turnpike, a major arterial that crosses the Oklahoma City metro area in an east/west direction on the northern boundary of the metro area and continues to the south on the western boundary of the metro area.
The primary tenant at the St. Anthony’s Healthplex North Property is SSM Health Care of Oklahoma, Inc. (“SSM”), guaranteed by its parent SSM Health Care Corporation (“SSMHCC”). SSMHCC’s revenue bonds are rated AAA by Fitch. SSM leases 67,717 SF (70% of St. Anthony’s Healthplex North Property’s net rentable square footage) on a 10 year, triple net lease, with four, 5-year options to extend. The lease expires February 22, 2025. SSM utilizes its premises as an emergency room/urgent care facility under a license from St. Anthony’s Hospital, a Catholic not-for-profit health care provider, which is located approximately 12 miles south of the St. Anthony’s Healthplex North Property. In addition, SSM leases the entire second floor and portions of the fourth and fifth floors as medical office space.
The following table presents certain information relating to the tenants at the St. Anthony’s Healthplex North Property:
Largest Owned Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating (Fitch/MIS/S&P)(1) | Tenant GLA | % of GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | Lease Expiration(2) | Renewal / Extension Options | |||||||||||||
SSM Health Care of Oklahoma, Inc. | AAA / Baa2 / NR | 67,717 | 69.9 | % | $2,634,560 | 88.3 | % | $38.91 | 2/22/2025 | 4, 5-year options | |||||||||||
OSOI | NR / NR / NR | 8,723 | 9.0 | 209,352 | 7.0 | 24.00 | 3/31/2025 | 2, 5-year options | |||||||||||||
Brent Scott | NR / NR / NR | 3,042 | 3.1 | 73,008 | 2.4 | 24.00 | 3/15/2025 | 2, 5-year options | |||||||||||||
Diana Hampton MD | NR / NR / NR | 2,616 | 2.7 | 65,400 | 2.2 | 25.00 | 2/28/2025 | NA | |||||||||||||
Largest Owned Tenants | 82,098 | 84.8 | % | $2,982,320 | 100.0 | % | $36.33 | ||||||||||||||
Vacant Spaces (Owned Spaces) | 14,749 | 15.2 | 0 | 0.0 | 0.00 | ||||||||||||||||
Total / Wtd. Avg. All Owned Tenants | 96,847 | 100.0 | % | $2,982,320 | 100.0 | % | $36.33 |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | All leases are assumed to remain in place through contractual expiration even if early termination options are available. |
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ST. ANTHONY’S HEALTHPLEX NORTH |
The following table presents certain information relating to the lease rollover schedule at the St. Anthony’s Healthplex North Property, based on initial lease expiration dates:
Lease Expiration Schedule(1)
Year Ending December 31, | Expiring Owned GLA | % of Owned GLA | Cumulative % of Owned GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | # of Expiring Tenants | |||||||||||||
MTM | 0 | 0.0 | % | 0.0% | $0 | 0.0 | % | $0.00 | 0 | |||||||||||
2015 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2016 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2017 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2018 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2019 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2020 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2021 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2022 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2023 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2024 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2025 | 82,098 | 84.8 | 84.8% | 2,982,320 | 100.0 | 36.33 | 4 | |||||||||||||
2026 & Thereafter | 0 | 0.0 | 84.8% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
Vacant | 14,749 | 15.2 | 100.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
Total / Wtd. Avg. | 96,847 | 100.0 | % | $2,982,320 | 100.0 | % | $36.33 | 4 |
(1) | Calculated based on the approximate square footage occupied by each Owned Tenant per rent roll dated March 27, 2015. |
The following table presents certain information relating to historical leasing at the St. Anthony’s Healthplex North Property:
Historical Leased %(1)(2)
2013 | 2014 | As of 3/27/2015 | ||||
Owned Space | NAP | NAP | 84.8%(3) |
(1) | As provided by the borrower and which represents average occupancy for the specified year unless otherwise indicated. |
(2) | Historical occupancy is not available as the St. Anthony’s Healthplex North Property was constructed in 2015. |
(3) | The St. Anthony’s Healthplex North Property is approximately 95.3% leased to seven tenants. Two tenants, Ancon Development Corporation and Miller Architects, Inc., each of which are borrower affiliates, are expected to take occupancy in June 2015 and September 2015, respectively, and a third tenant, Comprehensive Foot & Ankle Institute, PLLC, is expected to take occupancy in August 2015. |
B-77 |
ST. ANTHONY’S HEALTHPLEX NORTH |
n | Operating History and Underwritten Net Cash Flow.The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the St. Anthony’s Healthplex North Property: |
Cash Flow Analysis(1)
Underwritten(2) | Underwritten $ per SF | ||||
Base Rent | $2,982,320 | $30.79 | |||
Contractual Rent Steps | 0 | 0.00 | |||
Gross Up Vacancy | 389,119 | 4.02 | |||
Total Rent | $3,371,439 | $34.81 | |||
Total Reimbursables | 216,175 | 2.23 | |||
Other Income | 0 | 0.00 | |||
Vacancy & Credit Loss | (389,119) | (4.02) | |||
Effective Gross Income | $3,198,495 | $33.03 | |||
Total Operating Expenses | $459,280 | $4.74 | |||
Net Operating Income | $2,739,215 | $28.28 | |||
TI/LC | 48,324 | 0.50 | |||
Capital Expenditures | 19,369 | 0.20 | |||
Net Cash Flow | $2,671,522 | $27.58 |
(1) | Certain items such as straight line rent, interest expense, interest income, lease cancellation income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. |
(2) | Underwritten Cash Flow is based on contractual rents as of March 27, 2015 and the average rents of the credit tenants over the ten year loan term. |
n | Appraisal. According to the appraisal, the St. Anthony’s Healthplex North Property had an “as-is” appraised value of $43,000,000 as of March 10, 2015 and a “prospective market value upon stabilization” of $44,500,000 as of June 1, 2015, which assumes certain tenant buildouts are completed. The St. Anthony’s Healthplex North Property is expected to achieve stabilization when tenant Miller Architects completes its buildout and takes occupancy of its space. |
n | Environmental Matters. According to a Phase I environmental report dated February 24, 2015, there are no recognized environmental conditions or recommendations for further action at the St. Anthony’s Healthplex North Property. |
n | Market Overview and Competition. The St. Anthony’s Healthplex North Property is located in Oklahoma City, Oklahoma in the Memorial Corridor office submarket. Land uses within the immediate neighborhood surrounding the St. Anthony’s Healthplex North Property are single family residential subdivisions and commercial developments along major arterials and the Kilpatrick Turnpike. |
According to the appraisal, the Oklahoma City office market consists of approximately 22.5 million SF in 289 buildings with an average vacancy rate of 12.1%, as of the fourth quarter of 2014. The Class A Oklahoma City office market consists of approximately 3.6 million SF in 23 buildings with an average vacancy rate of 3.4%. The vacancy rate in the Memorial Corridor office submarket was 2.6% as of the fourth quarter of 2014. The Class A Memorial Corridor office submarket vacancy rate was 1.4% as of fourth quarter 2014.
According to the appraisal, as of the fourth quarter 2014, the Oklahoma City medical office market consists of approximately 1.79 million SF with an average rental rate of $18.82 per SF and an overall vacancy of 8.7%.
B-78 |
ST. ANTHONY’S HEALTHPLEX NORTH |
The following table presents certain information relating to the primary competition for the St. Anthony’s Healthplex North Property:
Competitive Set(1)
St. Anthony’s Healthplex North(2) | St. Anthony’s Healthplex West | St. Anthony’s Healthplex East | St. Anthony’s Healthplex South | |||||
City | Oklahoma City | Mustang | Oklahoma City | Oklahoma City | ||||
Occupancy | 84.8% | 59.0% | 84.0% | 79.0% |
(1) | Source: Appraisal. |
(2) | Occupancy for the St. Anthony’s Healthplex North Property as provided by the borrower per the March 27, 2015 rent roll. |
n | The Borrower. The borrower is WHP Senior, LLC, a single-purpose Delaware limited liability company structured to be bankruptcy-remote with two independent directors in its organizational structure. Legal counsel to the borrower delivered a non-consolidation opinion in connection with the origination of the St. Anthony’s Healthplex North Loan. G. David Neff, Jr., the G. David Neff Jr. Living Trust, Dwight Darin Miller, and the Dwight Darin Miller Living Trust, jointly and severally, are the non-recourse carveout guarantors of the St. Anthony’s Healthplex North Loan. |
n | Escrows. In connection with the origination of the St. Anthony’s Healthplex North Loan, the borrower funded aggregate reserves of $239,625 comprised of: (i) $17,998 for real estate taxes; (ii) $16,009 for insurance; (iii) $43,013 for mezzanine loan interest (which was funded under the St. Anthony’s Healthplex North Mezzanine Loan); and (iv) $162,605 for finishing and change order work relating to the construction of the St. Anthony’s Healthplex North Property. |
Additionally, on each due date, the borrower is required to fund the following reserves with respect to the St. Anthony’s Healthplex North Property: (i) a tax reserve in an amount equal to one-twelfth of the annual amount that the lender estimates will be necessary to pay taxes over the then succeeding 12-month period; (ii) an insurance reserve in an amount equal to one-twelfth of the annual amount that the lender estimates will be necessary to pay insurance premiums over the then succeeding 12-month period; (iii) a TI/LC reserve in an amount equal to $4,027; (iv) a replacement reserve in an amount equal to $1,614, subject to a cap of funds to be held in the reserve account at any time of $58,108; (v) an amount equal to the aggregate amount of approved operating expenses and approved extraordinary expenses to be incurred by the borrower for the then current monthly period; and (vi) during the occurrence and continuance of a St. Anthony’s Healthplex North Trigger Period other than a Mezzanine Trigger Period (each as defined below), an excess cash flow reserve with respect to any Excess Cash (as defined below) generated by the St. Anthony’s Healthplex North Property.
n | Lockbox and Cash Management.The St. Anthony’s Healthplex North Loan is structured with a hard lockbox and in-place cash management. At the origination of the St. Anthony’s Healthplex North Loan, the borrower was required to establish a lender-controlled lockbox account into which tenants at the St. Anthony’s Healthplex North Property will pay their rents. Any revenues derived from the St. Anthony’s Healthplex North Property that are received by the borrower or the property manager are also required to be deposited into the lender-controlled lockbox account. At origination of the St. Anthony’s Healthplex North Loan, the lender, on the borrower’s behalf, established a cash management account in the name of the borrower for the sole and exclusive benefit of the lender. Funds on deposit in the lockbox account are required to be swept into a cash management account on each business day. |
B-79 |
ST. ANTHONY’S HEALTHPLEX NORTH |
So long as no event of default has occurred and is continuing under the St. Anthony’s Healthplex North Loan, on each monthly payment date, the lender is required to disburse all funds on deposit in the cash management account to pay required reserves, debt service, approved operating expenses, mezzanine debt service and all other amounts then due and payable under the St. Anthony’s Healthplex North Loan documents, with any remaining amounts (“Excess Cash”) to be disbursed to the mezzanine borrower, provided that no St. Anthony’s Healthplex North Trigger Period has occurred. During a St. Anthony’s Healthplex North Trigger Period, for so long as (x) no event of default under the St. Anthony’s Healthplex North Loan has occurred and is continuing and (y) no event of default under the St. Anthony’s Healthplex North Mezzanine Loan has occurred and is continuing (clause (y) being a “Mezzanine Trigger Period”), all Excess Cash is required to be escrowed by the lender. Such Excess Cash may be used for the payment of tenant improvements and leasing commissions associated with SSM during the occurrence and continuance of an SSM Trigger Period. During a Mezzanine Trigger Period and for so long as no event of default under the St. Anthony’s Healthplex North Loan has occurred and is continuing, all Excess Cash will be paid to the mezzanine lender.
“St. Anthony’s Healthplex North Trigger Period”means (A) a period commencing upon the earliest to occur of: (i) the occurrence and continuance of an event of default under the St. Anthony’s Healthplex North Loan, (ii) the occurrence of a Mezzanine Trigger Period, (iii) the debt service coverage ratio (based on the debt service for both the St. Anthony’s Healthplex North Loan and the St. Anthony’s Healthplex North Mezzanine Loan) being less than 1.10x, and (iv) the occurrence of an SSM Trigger Period; and (B) expiring (w) in the case of clause (A)(i) above, upon the cure (if applicable) of such event of default, (x) in the case of clause (A)(ii) above, when a Mezzanine Trigger Period no longer exists, (y) in the case of clause (A)(iii) above, on the date that the debt service coverage ratio is at least equal to 1.10x (based on the debt service for both the St. Anthony’s Healthplex North Loan and the St. Anthony’s Healthplex North Mezzanine Loan) for two consecutive calendar quarters and (z) in the case of clause (A)(iv) above, when an SSM Trigger Period no longer exists.
“SSM”means, collectively, SSM Health Care of Oklahoma, Inc., and any replacement tenant for all or any portion of the SSM space.
“SSM Trigger Period” means a period (A) commencing upon the first to occur of (i) SSM being in default under its lease beyond applicable notice and cure periods, (ii) SSM “going dark” in its premises, (iii) SSM giving notice that it is terminating its lease for all or any portion of its premises, (iv) any termination or cancellation of SSM’s lease (including, without limitation, rejection in any bankruptcy or similar insolvency proceeding) and/or SSM’s lease failing to otherwise be in full force and effect, (v) any bankruptcy or insolvency of SSM and (vi) SSM failing to extend or renew its lease on or prior to February 22, 2024; and (B) expiring upon the first to occur of (1) the satisfaction of the SSM Cure Conditions (as defined below) or (2) the borrower leasing the entire SSM premises to a replacement tenant on market terms approved by the lender and such replacement being in occupancy, open for business and paying full unabated rent.
“SSM Cure Conditions” means each of the following, as applicable: (i) SSM has cured all defaults under its lease; (ii) SSM is no longer “dark”; (iii) SSM has revoked or rescinded all termination or cancellation notices with respect to its lease and has re-affirmed the lease as being in full force and effect; (iv) if the SSM Trigger Period is due to SSM’s failure to extend or renew its lease, SSM has renewed or extended its lease in accordance with the terms of the related loan agreement and at a net effective rental rate at least equal to the net effective rental rate paid by SSM for its premises during the 12 months immediately prior to the beginning of such renewal term; (v) with respect to any applicable bankruptcy or insolvency proceedings involving SSM and/or SSM’s lease, SSM is no longer insolvent or subject to any bankruptcy or insolvency proceedings and has affirmed its lease pursuant to a final, non-appealable order of a court of competent jurisdiction; and (vi) SSM is paying full, unabated rent under its lease.
B-80 |
ST. ANTHONY’S HEALTHPLEX NORTH |
n | Property Management.The St. Anthony’s Healthplex North Property is managed byPrice Edwards & Company, a third-party manager, pursuant to a management agreement. Under the St. Anthony’s Healthplex North Loan documents, the borrower is not permitted to replace the current property manager except with a management company approved by the lender. The lender may replace (or require the borrower to replace) the property manager if (i) there is a default (after the expiration of any applicable cure period) by the property manager under the management agreement, (ii) there is a default which remains uncured and is continuing under the St. Anthony’s Healthplex North Loan documents, (iii) the debt service coverage ratio (based on the debt service for both the St. Anthony’s Healthplex North Loan and the St. Anthony’s Healthplex North Mezzanine Loan) is less than 1.10x, or (iv) certain bankruptcy-related events occur with respect to the property manager. |
n | Mezzanine or Subordinate Indebtedness. Concurrently with the origination of the St. Anthony’s Healthplex North Loan, RAIT Partnership, L.P., an affiliate of the lender, made a $5,000,000 mezzanine loan (the “St. Anthony’s Healthplex North Mezzanine Loan”) to WHP Mezz, LLC, a Delaware limited liability company, secured by a pledge of 100% of the mezzanine borrower’s equity interest in the borrower. The St. Anthony’s Healthplex North Mezzanine Loan carries an interest rate of 9.9900%per annum and is co-terminous with the St. Anthony’s Healthplex North Loan. The lender has entered into a customary intercreditor agreement with the mezzanine lender under the St. Anthony’s Healthplex North Mezzanine Loan. |
n | Terrorism Insurance. The borrower is required to maintain an “all risk” insurance policy that provides coverage for terrorism in an amount equal to the full replacement cost of the St. Anthony’s Healthplex North Property, plus 12 months of business interruption coverage as calculated under the St. Anthony’s Healthplex North Loan documents, with an additional extended period of indemnity for another 6 months or until income is restored to the prior level (whichever first occurs). See “Risk Factors—Terrorism Insurance May Not Be Available for All Mortgaged Properties” in the Prospectus Supplement. |
B-81 |
ROCKSIDE ROAD OFFICE PORTFOLIO |
B-82 |
ROCKSIDE ROAD OFFICE PORTFOLIO |
B-83 |
ROCKSIDE ROAD OFFICE PORTFOLIO |
Mortgaged Property Information | Mortgage Loan Information | ||||
Number of Mortgaged Properties | 4 | Loan Seller | CGMRC | ||
Location (City/State) | Valley View, Ohio | Cut-off Date Principal Balance | $29,500,000 | ||
Property Type(1) | Various | Cut-off Date Principal Balance per SF | $75.65 | ||
Size (SF) | 389,949 | Percentage of Initial Pool Balance | 4.1% | ||
Total Occupancy as of 3/10/2015 | 83.0% | Number of Related Mortgage Loans | None | ||
Owned Occupancy as of 3/10/2015 | 83.0% | Type of Security | Fee Simple | ||
Year Built / Latest Renovation | Various / NAP | Mortgage Rate | 4.3400% | ||
Appraised Value(2) | $42,472,500 | Original Term to Maturity (Months) | 120 | ||
Original Amortization Term (Months) | 360 | ||||
Original Interest Only Period (Months) | 36 | ||||
Underwritten Revenues | $5,048,030 | ||||
Underwritten Expenses | $1,879,859 | Escrows | |||
Underwritten Net Operating Income (NOI) | $3,168,170 | Upfront | Monthly | ||
Underwritten Net Cash Flow (NCF) | $2,935,920 | Taxes | $0 | $50,076 | |
Cut-off Date LTV Ratio | 69.5% | Insurance | $0 | $5,166 | |
Maturity Date LTV Ratio | 59.0% | Replacement Reserve | $0 | $7,046 | |
DSCR Based on Underwritten NOI / NCF | 1.80x / 1.67x | TI/LC(3) | $371,000 | $19,459 | |
Debt Yield Based on Underwritten NOI / NCF | 10.7% / 10.0% | Other(4) | $356,281 | $0 |
Sources and Uses | |||||||||
Sources | $ | % | Uses | $ | % | ||||
Loan Amount | $29,500,000 | 99.8 | % | Loan Payoff | $21,941,681 | 74.2 | % | ||
Other Sources | 70,000 | 0.2 | Principal Equity Distribution | 5,949,423 | 20.1 | ||||
Closing Costs | 951,614 | 3.2 | |||||||
Reserves | 727,281 | 2.5 | |||||||
Total Sources | $29,570,000 | 100.0 | % | Total Uses | $29,570,000 | 100.0 | % |
(1) | The Rockside Road Office Portfolio consists of four primarily office properties, two of which also contain warehouse space. |
(2) | Appraised Value is based on the “as-is” portfolio value. The aggregate appraised “as-is” value of the mortgaged properties on an individual basis is $40,450,000, which results in a Cut-off Date LTV Ratio of 72.9%. See“—Appraisal” below. |
(3) | The TI/LC reserve of $371,000 represents a $271,000 TI/LC reserve established for the Anthem Blue Cross and Blue Shield space and a $100,000 reserve for general TI/LC. The TI/LC reserve will be capped at $701,908. See“—Escrows” below. |
(4) | Other upfront reserves of $356,281 represent (i) $9,375 for deferred maintenance and (ii) $346,906 for unfunded tenant obligations. See“—Escrows” below. |
n | The Mortgage Loan. The mortgage loan (the “Rockside Road Office Portfolio Loan”) is evidenced by a note in the original principal amount of $29,500,000 and is secured by a first mortgage encumbering the borrowers’ fee simple interest in two office and two office/flex properties located in Valley View, Ohio (the “Rockside Road Office Portfolio Properties”). The Rockside Road Office Portfolio Loan was originated by Citigroup Global Markets Realty Corp. on May 7, 2015. The Rockside Road Office Portfolio Loan has an outstanding principal balance as of the Cut-off Date of $29,500,000, which represents approximately 4.1% of the Initial Pool Balance, and accrues interest at an interest rate of 4.3400%per annum. The proceeds of the Rockside Road Office Portfolio Loan were used to refinance existing debt on the Rockside Road Office Portfolio Properties, pay origination costs, fund reserves and return equity to the borrower sponsor. |
The Rockside Road Office Portfolio Loan had an initial term of 120 months and has a remaining term of 119 months as of the Cut-off Date. The Rockside Road Office Portfolio Loan requires payments of interest only for the initial 36 months, followed by monthly payments of interest and principal sufficient to amortize the Rockside Road Office Portfolio Loan over a 30-year amortization schedule. The scheduled maturity date of the Rockside Road Office Portfolio Loan is the due date in June 2025. Defeasance with direct, non-callable obligations of the United States of America is permitted at any time on or after the first due date following the second anniversary of the securitization Closing Date. Voluntary prepayment of the Rockside Road Office Portfolio Loan, without a prepayment premium or yield maintenance charge, is permitted on or after the due date in April 2025.
B-84 |
ROCKSIDE ROAD OFFICE PORTFOLIO |
n | The Mortgaged Properties.The Rockside Road Office Portfolio Properties consist of two office and two office/flex properties located in Valley View, Ohio. The Rockside Road Office Portfolio Properties, comprising an aggregate 389,949 SF, were constructed between 1986 and 1998 and are located 10 miles south of the Cleveland CBD. As of March 10, 2015, Total Occupancy and Owned Occupancy were both 83.0%. |
The following table presents certain information relating to the Rockside Road Office Portfolio Properties:
Property Name | Year Built | Building GLA | Property Type | Occupancy(1) | Allocated Cut-off Date Loan Amount | % Allocated Cut-off Date Loan Amount | Appraised Value(2)(3) | Appraisal Market Rent $ per SF | UW Base Rent $ per SF | UW NCF | ||||||||||||||||
Highpointe Corporate Park | 1989, 1998 | 135,921 | Office/Flex | 90.4 | % | $11,012,360 | 37.3 | % | $15,100,000 | $14.95 | $12.99 | $1,237,155 | ||||||||||||||
Rockside Business Pointe | 1986 | 115,918 | Office/Flex | 77.6 | % | 7,475,278 | 25.3 | 10,250,000 | $14.62 | 12.86 | 716,789 | |||||||||||||||
Southport Center | 1991 | 93,993 | Office | 71.1 | % | 7,365,884 | 25.0 | 10,100,000 | $18.01 | 15.35 | 585,440 | |||||||||||||||
MRN III | 1998 | 44,117 | Office | 100.0 | % | 3,646,478 | 12.4 | 5,000,000 | $15.53 | 12.56 | 396,536 | |||||||||||||||
Total / Wtd. Avg. | 389,949 | 83.0 | % | $29,500,000 | 100.0 | % | $42,472,500 | $15.66 | $13.38 | $2,935,920 |
(1) | Occupancy as of March 10, 2015. |
(2) | The appraised value of $42,472,500 represents the “as-is” appraised value of the Rockside Road Office Portfolio Properties as a combined portfolio. The aggregate “as-is” appraised values of the four individual Rockside Road Office Portfolio Properties is $40,450,000 |
(3) | Southport Center has an “as stabilized” appraised value of $11,200,000 as of March 18, 2016. |
Highpointe Corporate Park is a three-building, 135,921 SF office/flex complex located on Rockside Road approximately 0.5 mile east of Southport Center. The buildings were constructed in 1989 and 1998 and contain approximately 85% office space and 15% flex space. Highpointe Corporate Park is 90.4% leased to 14 tenants as of March 10, 2015. The largest tenant at Highpointe Corporate Park is Harley Davidson Dealers Services, Inc. which leases 25,762 SF through December 31, 2019 and contributes to 8.9% of the overall UW Base Rent.
Rockside Business Pointe is a two-building, 115,918 SF office/flex complex located directly south of Highpointe Corporate Park. The buildings were constructed in 1986. One building contains 100% office space and the other contains approximately 70% office space and 30% flex space. Rockside Business Pointe is 77.6% leased to 17 tenants as of March 10, 2015. The largest tenant at Rockside Business Pointe is A-1 General Insurance Agency which leases 22,600 SF through May 31, 2017 and contributes to 8.3% of the overall UW Base Rent.
Southport Center is a 93,993 SF office building located at the intersection of Rockside and Canal Roads. The building was constructed in 1991. Southport Center is 100.0% leased to three tenants as of March 10, 2015. The largest tenant at Southport Center is ExactCare Pharmacy which leases a total of 49,335 SF through April and September 2021 and contributes 17.3% of the overall UW Base Rent. The UW Base Rent excluded the rental income from Anthem Blue Cross and Blue Shield which has a lease expiring in June 2015. The underwritten occupancy is 71.1%.
MRN III is a two-building, 44,117 SF office complex located on the north side of Rockside Road, east of Canal Road. The buildings were constructed in 1998. MRN III is 100.0% leased to three tenants as of March 10, 2015. The largest tenant at MRN III is ExactCare Pharmacy which leases a total of 26,997 SF through July 2020 and contributes 7.4% of the overall UW Base Rent.
B-85 |
ROCKSIDE ROAD OFFICE PORTFOLIO |
The following table presents certain information relating to the major tenants at the Rockside Road Office Portfolio Properties:
Ten Largest Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating (Fitch/Moody’s/S&P)(1) | Tenant GLA | % of GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | Lease Expiration | Renewal / Extension Options | ||||||||||||||
ExactCare Pharmacy(2) | NR/NR/NR | 76,332 | 19.6 | % | $1,071,681 | 24.7 | % | $14.04 | Various | NA | ||||||||||||
Harley Davidson Dealers Services, Inc. | NR/NR/A- | 25,762 | 6.6 | 386,430 | 8.9 | 15.00 | 12/31/2019 | 2, 5-year options | ||||||||||||||
A-1 General Insurance Agency | NR/NR/NR | 22,600 | 5.8 | 361,600 | 8.3 | 16.00 | 5/31/2017 | 1, 5-year option | ||||||||||||||
TRW(3) | NR/NR/NR | 17,487 | 4.5 | 275,420 | 6.4 | 15.75 | 7/31/2020 | 2, 5-year options | ||||||||||||||
Builders Exchange Inc. | NR/NR/NR | 12,015 | 3.1 | 234,338 | 5.4 | 19.50 | 8/31/2016 | NA | ||||||||||||||
NAS Recruitment Communications(4) | NR/NR/NR | 14,178 | 3.6 | 212,670 | 4.9 | 15.00 | 5/7/2025 | NA | ||||||||||||||
Ohio Center Broadcasting | NR/NR/NR | 15,240 | 3.9 | 182,000 | 4.2 | 11.94 | 8/31/2020 | 2, 5-year options | ||||||||||||||
Crossroads Hospice | NR/NR/NR | 14,810 | 3.8 | 177,720 | 4.1 | 12.00 | 3/31/2022 | NA | ||||||||||||||
YP Texas Yellow Pages | NR/NR/NR | 11,012 | 2.8 | 170,686 | 3.9 | 15.50 | 8/30/2016 | NA | ||||||||||||||
Baker’s Union Pension/Health | NR/NR/NR | 8,729 | 2.2 | 130,935 | 3.0 | 15.00 | 5/31/2020 | 2, 5-year options | ||||||||||||||
Ten Largest Tenants | 218,165 | 55.9 | % | $3,203,480 | 73.9 | % | $14.68 | |||||||||||||||
Remaining Tenants | 105,598 | 27.1 | 1,129,587 | 26.1 | 10.70 | |||||||||||||||||
Vacant | 66,186 | 17.0 | 0 | 0.0 | 0.00 | |||||||||||||||||
Total / Wtd. Avg. All Tenants | 389,949 | 100.0 | % | $4,333,067 | 100.0 | % | $13.38 | |||||||||||||||
(1) | Certain ratings are those of the parent company, whether or not the parent guarantees the lease. |
(2) | ExactCare Pharmacy is a tenant at both the Southport Center and MRN III buildings and leases its space under the following terms: (a) Southport Center—27,816 SF at UW Base Rent of $15.21 per SF with lease expiration of April 2021 and an option to terminate its lease on August 31, 2020 by providing 9 months’ notice and payment of unamortized tenant improvements and cost of generator along with rent differential of $1.00 per SF or $21,519 annually for the remaining time on the lease; (b) Southport Center—21,519 SF at UW Base Rent of $15.21 per SF with lease expiration of September 2021 and an option to terminate its lease on March 31, 2020 by providing 9 months’ notice and payment of unamortized tenant improvements and cost of generator along with rent differential of $1.00 per SF or $21,519 annually for the remaining time on the lease; and (c) MRN III—26,997 SF at UW Base Rent of $11.90 per SF with lease expiration of July 2020 and an option to terminate its lease on December 31, 2018 by providing 9 months’ notice and payment of unamortized TI/LC at 7% and rent differential of $1.00 per SF annually for the remaining time on the lease. |
(3) | TRW has an option to terminate its lease on July 31, 2018 by providing 9 months’ notice and payment of unamortized TI/LC at 8% interest, which are estimated to be $191,500, plus the rental differential between the 5th and 7th year lease rental rates. |
(4) | NAS Recruitment Communications has an option to terminate its lease January 31, 2020 or March 31, 2023 by providing 6 months’ notice and payment of unamortized tenant improvements, rent abatement and recapture of average rent differential as specified in its lease. |
The following table presents the lease rollover schedule at the Rockside Road Office Portfolio Properties, based on initial lease expiration dates:
Lease Expiration Schedule(1)(2)
Year Ending December 31, | Expiring Owned GLA | % of Owned GLA | Cumulative % of Owned GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | # of Expiring Tenants | ||||||||||||||
MTM | 0 | 0.0 | % | 0.0% | $0 | 0.0 | % | $0.00 | 0 | ||||||||||||
2015 | 7,120 | 1.8 | 1.8% | 50,326 | 1.2 | 7.07 | 2 | ||||||||||||||
2016 | 46,447 | 11.9 | 13.7% | 664,130 | 15.3 | 14.30 | 9 | ||||||||||||||
2017 | 55,133 | 14.1 | 27.9% | 777,240 | 17.9 | 14.10 | 10 | ||||||||||||||
2018 | 18,525 | 4.8 | 32.6% | 161,225 | 3.7 | 8.70 | 3 | ||||||||||||||
2019 | 31,976 | 8.2 | 40.8% | 446,430 | 10.3 | 13.96 | 2 | ||||||||||||||
2020 | 86,239 | 22.1 | 62.9% | 1,092,941 | 25.2 | 12.67 | 7 | ||||||||||||||
2021 | 49,335 | 12.7 | 75.6% | 750,385 | 17.3 | 15.21 | 2 | ||||||||||||||
2022 | 14,810 | 3.8 | 79.4% | 177,720 | 4.1 | 12.00 | 1 | ||||||||||||||
2023 | 0 | 0.0 | 79.4% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2024 | 0 | 0.0 | 79.4% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2025 | 14,178 | 3.6 | 83.0% | 212,670 | 4.9 | 15.00 | 1 | ||||||||||||||
2026 & Thereafter | 0 | 0.0 | 83.0% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
Vacant | 66,186 | 17.0 | 100.0% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
Total / Wtd. Avg. | 389,949 | 100.0 | % | $4,333,067 | 100.0 | % | $13.38 | 37 |
(1) | Calculated based on approximate square footage occupied by each Owned Tenant. |
(2) | Certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date of the applicable lease and that are not represented in the Lease Expiration Schedule. |
B-86 |
ROCKSIDE ROAD OFFICE PORTFOLIO |
The following table presents certain information relating to historical leasing at the Roadside Road Office Portfolio Properties:
Historical Leased %(1)
2012 | 2013 | 2014 | As of 3/10/2015 | |||||
Rockside Road Office Portfolio | 83.8% | 80.7% | 90.0% | 83.0% |
(1) | As provided by the borrowers and which reflects average occupancy for the specified year unless otherwise indicated. |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Roadside Road Office Portfolio Properties: |
Cash Flow Analysis(1)
2012 | 2013 | 2014 | Underwritten | Underwritten $ per SF | ||||||||||||
Base Rent | $3,666,971 | $3,815,495 | $3,940,801 | $4,261,494 | $10.93 | |||||||||||
Contractual Rent Steps(2) | 0 | 0 | 0 | 71,573 | 0.18 | |||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 1,064,069 | 2.73 | |||||||||||
Total Rent | $3,666,971 | $3,815,495 | $3,940,801 | $5,397,136 | $13.84 | |||||||||||
Total Reimbursables | 442,430 | 392,060 | 465,567 | 441,144 | 1.13 | |||||||||||
Other Income(3) | 259,368 | 309,139 | 273,819 | 273,819 | 0.70 | |||||||||||
Vacancy & Credit Loss(4) | 0 | 0 | 0 | (1,064,069 | ) | (2.73 | ) | |||||||||
Effective Gross Income | $4,368,769 | $4,516,694 | $4,680,187 | $5,048,030 | $12.95 | |||||||||||
Real Estate Taxes | $483,098 | $593,110 | $608,626 | $572,293 | $1.47 | |||||||||||
Insurance | 35,012 | 39,951 | 47,983 | 59,044 | 0.15 | |||||||||||
Management Fee | 171,831 | 176,428 | 183,896 | 201,921 | 0.52 | |||||||||||
Other Operating Expenses | 926,093 | 941,597 | 1,045,106 | 1,046,601 | 2.68 | |||||||||||
Total Operating Expenses | $1,616,033 | $1,751,085 | $1,885,611 | $1,879,859 | $4.82 | |||||||||||
Net Operating Income | $2,752,736 | $2,765,609 | $2,794,576 | $3,168,170 | $8.12 | |||||||||||
TI/LC | 0 | 0 | 0 | 147,695 | 0.38 | |||||||||||
Replacement Reserves | 0 | 0 | 0 | 84,555 | 0.22 | |||||||||||
Net Cash Flow | $2,752,736 | $2,765,609 | $2,794,576 | $2,935,920 | $7.53 |
(1) | Certain items such as straight line rent, interest expense, interest income, lease cancellation income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. |
(2) | Contractual rent steps are underwritten based upon the actual scheduled rent increases through September 16, 2015. |
(3) | Other Income includes tenant chargebacks and miscellaneous income. |
n | Appraisal.As of the appraisal valuation date of March 18, 2015, the Rockside Road Office Portfolio Properties had an aggregate “as-is” appraised value of $42,472,500, which represents the appraised values for the Rockside Road Office Portfolio Properties on a portfolio basis, as compared to the aggregate “as-is” appraised value of $40,450,000 for the four individual Rockside Road Office Portfolio Properties. Southport Center has an “as stabilized” appraised value of $11,200,000 as of March 18, 2016. The Rockside Road Office Portfolio Properties have an aggregate “as stabilized” appraised value of $43,627,500, which represents the appraised values for the Rockside Road Office Portfolio Properties on a portfolio basis, as compared to the aggregate “as stabilized” appraised value of $41,550,000 for the four individual Rockside Road Office Portfolio Properties. |
n | Environmental Matters.Based on the Phase I environmental reports dated March 23, 2015, there were no recommendations for further action other than, with respect to Rockside Business Pointe, an operations and maintenance plan for asbestos, which was implemented in connection with the origination of the Rockside Road Office Portfolio Loan. |
B-87 |
ROCKSIDE ROAD OFFICE PORTFOLIO |
n | Market Overview and Competition. The Rockside Road Office Portfolio Properties are located in Valley View, Cuyahoga County, Ohio. MRN III, Highpointe Corporate Park, and Rockside Business Pointe are clustered together and Southport Center is located 0.5 miles west. Rockside Road is a four-lane, two-way major road that serves as a primary commercial corridor in south Cleveland. The Rockside Road Office Portfolio is located 1.5 miles from the major intersection of I-77 and I-480. I-77 provides a direct route north into the CBD and south to I-80 (the Ohio Turnpike). I-480 is a heavily traveled inner belt highway which provides direct access to the Cleveland-Hopkins International Airport, approximately 13 miles to the west. Industrial development is the predominant land use in the local area, with several industrial properties located immediately south of Rockside Road including flex, warehouse, and light manufacturing uses. |
The Rockside Road Office Portfolio is located in the South Office Submarket and the South Office Micro-Submarket.According to a third-party report, the South Office Submarket reported a first quarter 2015 supply of 9,548,425 SF. There had been no new construction in the submarket for the past nine quarters as of the first quarter of 2015, and no new construction is currently underway. The vacancy rate as of the first quarter of 2015 was at an eight-quarter low of 12.1%. Asking rents in the submarket have been fairly stable, and consistently higher than the overall market, with the first quarter 2015 average rental rate at $18.44 per SF.
Per the appraiser, occupancy for comparable buildings ranged from 71.3% to 91.4%, for a weighted average of 86.1%. The appraiser concluded with a 10.0% vacancy for Highpointe Corporate Park, MRN III, and Southport Center, and 20% for Rockside Business Pointe, for a weighted average vacancy of 13%.
n | The Borrowers. The borrowers are (i) MRN Cleveland I, LLC, (ii) MRN Cleveland II, LLC, (iii) MRN Cleveland III, LLC and (iv) Southport Center, LLC, each a single-purpose Delaware limited liability company. Legal counsel to the borrowers delivered a non-consolidation opinion in connection with the origination of the Rockside Road Office Portfolio Loan. Richard V. Nosan is the non-recourse carveout guarantor under the Rockside Road Office Portfolio Loan. |
Richard V. Nosan is the president and founder of Property Advisors Group, a family-run commercial real estate development, investment, and management company. Since founding Property Advisors Group in 1986, Mr. Nosan has successfully developed, purchased and owned over $75 million of office and industrial real estate.
n | Escrows. In connection with the origination of the Rockside Road Office Portfolio Loan, the borrowers funded aggregate reserves of $727,281 with respect to the Rockside Road Office Portfolio Properties, comprised of (i) $346,906 for unfunded obligations related to free rent of various tenants across the Rockside Road Office Portfolio Properties, (ii) $271,000 for tenant improvements and leasing commissions associated with the Anthem Blue Cross and Blue Shield tenant space at Southport Center, (iii) $100,000 for general tenant improvements and leasing commissions and (iv) $9,375 for deferred maintenance consisting of various immediate repairs across the Rockside Road Office Portfolio Properties. |
Additionally, on each due date, the borrowers are required to fund the following reserves with respect to the Rockside Road Office Portfolio Property: (i) a tax reserve in an amount equal to one-twelfth of the amount that the lender estimates will be necessary to pay taxes over the then succeeding 12-month period; (ii) at the option of the lender, if the liability or casualty policy maintained by the borrowers do not constitute an approved blanket or umbrella insurance policy under the Rockside Road Office Portfolio Loan documents, an insurance reserve in an amount equal to one-twelfth of the amount that the lender estimates will be necessary to pay insurance premiums over the then succeeding 12-month period; (iii) a replacement reserve in the amount of $7,046; and (iv) a tenant improvements and leasing commissions reserve in the amount of $19,459, subject to a cap of $701,908.
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n | Lockbox and Cash Management.TheRockside Road Office Portfolio Loan documents require a hard lockbox with springing cash management. The Rockside Road Office Portfolio Loan documents require the borrowers to direct all tenants to pay rent directly to a lender-controlled lockbox account and require that all other money received by the borrowers with respect to the Rockside Road Office Portfolio Properties be promptly deposited into such lockbox account following receipt. So long as a Rockside Road Office Portfolio Trigger Period is not then in effect, all funds in the lockbox are required to be swept and remitted on each business day to the borrowers’ operating account. During the continuance of a Rockside Road Office Portfolio Trigger Period all funds in the lockbox are required to be transferred on each business day to a lender-controlled cash management account, and, provided no event of default is continuing, applied to pay debt service and operating expenses of the Rockside Road Office Portfolio Properties and to fund required reserves in accordance with the Rockside Road Office Portfolio Loan documents. After the foregoing disbursements are made and so long as a Rockside Road Office Portfolio Trigger Period is continuing, all excess cash is trapped in an excess cash account and held as additional collateral for the Rockside Road Office Portfolio Loan. During the continuance of an event of default under the Rockside Road Office Portfolio Loan, the lender may apply any funds in the cash management account to amounts payable under the Rockside Road Office Portfolio Loan and/or toward the payment of expenses of the Rockside Road Office Portfolio Properties, in such order of priority as the lender may determine. |
A “Rockside Road Office Portfolio Trigger Period” means the period (A) commencing upon the earliest of, (i) the occurrence of an event of default, (ii) the debt service coverage ratio being less than 1.25x and (iii) the occurrence of a Rockside Road Specified Tenant Trigger Period; and (B) expiring upon (x) with respect to clause (A)(i) above, the cure of such event of default, (y) with respect to clause (A)(ii) above, the date that the debt service coverage ratio is equal to or greater than 1.30x for two consecutive calendar quarters and (z) with respect to clause (A)(iii) above, such Rockside Road Specified Tenant Trigger Period ceasing to exist.
A “Rockside Road Specified Tenant” means (i) ExactCare Pharmacy, (ii) any other lessee of the demised ExactCare Pharmacy space and (iii) any current or future guarantor(s) of any lease relating to the foregoing.
A “Rockside Road Specified Tenant Trigger Period” means a period: (A) commencing upon the first to occur of (i) a Rockside Road Specified Tenant being in default under its lease, (ii) a Rockside Road Specified Tenant failing to be in actual, physical possession of its space, failing to be open to the public for business during customary hours and/or “going dark”, (iii) a Rockside Road Specified Tenant giving notice that it is terminating its lease with respect to all or any portion of its space, (iv) any termination, cancellation or failure to be in full force and effect of any Rockside Road Specified Tenant lease, (v) any bankruptcy or similar insolvency of any Rockside Road Specified Tenant and (vi) a Rockside Road Specified Tenant failing to extend or renew its lease on or prior to the applicable notice deadline for a minimum period of five years; and (B) expiring upon the first to occur of the lender’s receipt of reasonably acceptable evidence demonstrating (i) the cure of the applicable event giving rise to the Rockside Road Specified Tenant Trigger Period or such circumstances ceasing to exist or (ii) the borrowers leasing the entire space that was demised to the Rockside Road Specified Tenant and the applicable new tenant (or series of tenants) under such lease being in actual, physical occupancy of the space and open to the public for business and paying the full amount of the rent.
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n | Property Management. The Rockside Road Office Portfolio Properties are currently managed by Inter-Build Construction Co., an affiliate of the borrowers. Under the Rockside Road Office Portfolio loan documents, the borrowers may terminate and replace the property manager without the lender’s consent, so long as (i) no event of default has occurred and is continuing, (ii) the lender receives at least 60 days’ prior written notice, (iii) the applicable replacement property manager is approved by the lender in writing (which approval may be conditioned upon the lender’s receipt of a Rating Agency Confirmation) and (iv) such replacement will not trigger a termination right, right of first refusal or other right or otherwise result in a material adverse effect with respect to a reciprocal easement agreement and/or any other similar documents affecting the Rockside Road Office Portfolio Properties. The lender has the right to terminate, or cause the borrowers to terminate, the management agreement and replace the property manager if: (a) the property manager becomes insolvent or a debtor in certain involuntary and any voluntary bankruptcy or insolvency proceedings; (b) a Rockside Road Office Portfolio Trigger Period has occurred and is continuing; (c) the property manager has engaged in gross negligence, fraud, willful misconduct or misappropriation of funds; or (d) there exists a default by the property manager beyond all applicable notice and cure periods under the management agreement. |
n | Mezzanine or Subordinate Indebtedness. Not permitted. |
n | Release of Collateral. Provided no event of default is then continuing under the Rockside Road Office Portfolio Loan, at any time after the second anniversary of the Closing Date, the borrowers may obtain the release of one or more of the Rockside Road Office Portfolio Properties from the lien of the Rockside Road Office Portfolio Loan documents, subject to the satisfaction of certain conditions, including among others: (i) delivery of defeasance collateral in an amount equal to the Rockside Road Office Portfolio Release Price for each Rockside Road Office Portfolio Property being released; (ii) after giving effect to the release, (I) the debt service coverage ratio for the remaining Rockside Road Office Portfolio Properties for the preceding 12-month period being no less than the greater of (a) 1.75x and (b) the debt service coverage ratio immediately prior to the release, (II) the debt yield for the remaining Rockside Road Office Portfolio Properties being no less than the greater of (a) 10.0% and (b) the debt yield immediately prior to the release and (III) the loan-to-value ratio for the remaining Rockside Road Office Portfolio Properties being no greater than the lesser of (a) 73% and (b) the loan-to-value ratio immediately prior to the release; and (iii) delivery of a REMIC opinion and a Rating Agency Confirmation with respect to such defeasance. |
“Rockside Road Office Portfolio Release Price” means, with respect to the release of any of the Rockside Road Office Portfolio Properties, the greater of (x) the net sales proceeds with respect to such Rockside Road Office Portfolio Property and (y) 120% of the allocated loan amount with respect to such Rockside Road Office Portfolio Property.
n | Terrorism Insurance. The borrowers are required to maintain an “all-risk” insurance policy that provides coverage for terrorism in an amount equal to the full replacement cost of the Rockside Road Office Portfolio Properties, covering no less than 12 months of business interruption coverage as calculated under the related loan documents in an amount equal to 100% of the projected gross income from the Rockside Road Office Portfolio Properties (on an actual loss sustained basis) for a period continuing until the restoration of the Rockside Road Office Portfolio Properties is completed and containing an extended period endorsement which provides for up to six months of additional coverage. The “all-risk” insurance policy providing terrorism insurance is required to contain a deductible that is no higher than $10,000, except as otherwise permitted in the related loan documents. See “Risk Factors—Terrorism Insurance May Not Be Available for All Mortgaged Properties” in the Prospectus Supplement. |
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Mortgaged Property Information | Mortgage Loan Information | ||||
Number of Mortgaged Properties | 1 | Loan Seller | RMF | ||
Location (City/State) | Pine Hill, New Jersey | Cut-off Date Principal Balance | $27,500,000 | ||
Property Type | Multifamily | Cut-off Date Principal Balance per Unit | $56,818.18 | ||
Size (Units) | 484 | Percentage of Initial Pool Balance | 3.8% | ||
Total Occupancy as of 3/23/2015 | 99.0% | Number of Related Mortgage Loans | None | ||
Owned Occupancy as 3/23/2015 | 99.0% | Type of Security | Fee Simple | ||
Year Built / Latest Renovation | 1973 / 2012 | Mortgage Rate | 4.4100% | ||
Appraised Value | $40,800,000 | Original Term to Maturity (Months) | 120 | ||
Original Amortization Term (Months) | 360 | ||||
Original Interest Only Period (Months) | 60 | ||||
Underwritten Revenues | $4,632,476 | ||||
Underwritten Expenses | $2,229,683 | Escrows | |||
Underwritten Net Operating Income (NOI) | $2,402,793 | Upfront | Monthly | ||
Underwritten Net Cash Flow (NCF) | $2,258,561 | Taxes | $100,065 | $47,650 | |
Cut-off Date LTV Ratio | 67.4% | Insurance | $29,312 | $13,958 | |
Maturity Date LTV Ratio | 61.6% | Replacement Reserves | $0 | $12,019 | |
DSCR Based on Underwritten NOI / NCF | 1.45x / 1.37x | TI/LC | $0 | $0 | |
Debt Yield Based on Underwritten NOI / NCF | 8.7% / 8.2% | Other(1) | $773,326 | $0 |
Sources and Uses | ||||||||||
Sources | $ | % | Uses | $ | % | |||||
Loan Amount | $27,500,000 | 99.9 | % | Loan Payoff | $25,015,352 | 90.8 | % | |||
Other Sources | 40,000 | 0.1 | Principal Equity Distribution | 1,107,706 | 4.0 | |||||
Reserves | 902,703 | 3.3 | ||||||||
Closing Costs | 514,238 | 1.9 | ||||||||
Total Sources | $27,540,000 | 100.0 | % | Total Uses | $27,540,000 | 100.0 | % |
(1) | Other upfront reserves represent an immediate repairs reserve of $748,326 and an environmental reserve of $25,000. See “—Escrows” below. |
n | The Mortgage Loan. The mortgage loan (the “Chalet Garden Apartments Loan”) is evidenced by a note in the original principal amount of $27,500,000 and is secured by a first mortgage encumbering the borrower’s fee simple interest in a 484-unit multifamily complex located in Pine Hill, New Jersey (the “Chalet Garden Apartments Property”). The Chalet Garden Apartments Loan was originated by Rialto Mortgage Finance, LLC on May 21, 2015 and represents approximately 3.8% of the Initial Pool Balance. The note evidencing the Chalet Garden Apartments Loan has an outstanding principal balance as of the Cut-off Date of $27,500,000 and has an interest rate of 4.4100%per annum. The borrower utilized the proceeds of the Chalet Garden Apartments Loan to refinance the existing debt on the Chalet Garden Apartments Property, pay loan origination costs, fund upfront reserves and return equity to the borrower. |
The Chalet Garden Apartments Loan had an initial term of 120 months and has a remaining term of 119 months as of the Cut-off Date. The Chalet Garden Apartments Loan requires payments of interest only for the initial 60 months, followed by monthly payments of principal and interest sufficient to amortize the Chalet Garden Apartments Loan over a 30-year amortization schedule. The scheduled maturity date of the Chalet Garden Apartments Loan is the due date in June 2025. Voluntary prepayment of the Chalet Garden Apartments Loan is permitted after the due date in March 2025 without payment of a yield maintenance premium. Provided no event of default under the Chalet Garden Apartments Loan is continuing, defeasance with direct, non-callable obligations of the United States of America is permitted at any time after the second anniversary of the securitization Closing Date. | |
n | The Mortgaged Property. The Chalet Garden Apartments Property is a 484-unit multifamily complex located in Pine Hill, New Jersey, approximately 18 miles southeast of the Philadelphia central business district. The Chalet Garden Apartments Property was built in 1973 and is comprised of 49 two-story buildings. The unit mix consists of 347 one-bedroom/one-bathroom units and 137 two-bedroom/one-bathroom units. Unit sizes range from 790 SF to 975 SF. The Chalet Garden Apartments Property offers community amenities which include a pool, fitness center, playground, tennis court, 24-hour emergency maintenance, and additional storage. All units include fully equipped kitchens, a washer/dryer, ceiling fans, patio/balcony, and oversized closets. There are approximately 970 parking spaces at the Chalet Garden Apartments Property. As of March 23, 2015, Total Occupancy and Owned Occupancy were both 99.0%. |
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The following table presents certain information relating to the units and rent at the Chalet Garden Apartments Property: |
Unit Mix(1)
Unit Type | Occupied Units | Vacant Units | Total Units | % of Total Units | Average SF per Unit | Monthly Market Rent per Unit | Monthly Actual Rent per Unit | Monthly Underwritten Rent per Unit | Underwritten Annual Rent | |||||||||||||
1 Bed / 1 Bath | 345 | (2) | 2 | 347 | (2) | 71.7 | % | 790 | $768 | $759 | $759 | $3,098,400 | (2) | |||||||||
2 Bed / 1 Bath | 134 | 3 | 137 | 28.3 | 975 | $970 | $961 | $961 | 1,544,880 | |||||||||||||
Total / Wtd. Avg. | 479 | 5 | 484 | 100.0 | % | 842 | $825 | $808 | $808 | $4,643,280 |
(1) | As provided by the borrower per the March 23, 2015 rent roll. | ||
(2) | The Chalet Garden Apartments Property includes five employee/non-revenue units which have been excluded from the Underwritten Annual Rent. |
The following table presents certain information relating to historical leasing at the Chalet Garden Apartments Property: |
Historical Leased %(1)
2012(2) | 2013(2) | 2014 | As of 3/23/2015 | |||||
Owned Space | N/A | N/A | 97.5% | 99.0% |
(1) | As provided by the borrower and which represents occupancy for the specified year unless otherwise indicated. | ||
(2) | Historical occupancy figures were not provided because the Chalet Garden Apartments Property was acquired by the borrower in 2014. |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Chalet Garden Apartments Property: |
Cash Flow Analysis(1)
2012 | 2013(2) | TTM 3/31/2015(2) | Underwritten(3) | Underwritten $ perUnit | |||||||||||||||||||||
Base Rent | $3,545,922 | $3,919,539 | $4,513,388 | $4,643,280 | $9,594 | ||||||||||||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 53,280 | 110 | ||||||||||||||||||||
Goss Potential Rent | $3,545,922 | $3,919,539 | $4,513,388 | $4,696,560 | $9,704 | ||||||||||||||||||||
Vacancy, Credit Loss & Concessions | (189,376 | ) | (67,458 | ) | 0 | (234,828 | ) | (485 | ) | ||||||||||||||||
Total Rent Revenue | $3,356,546 | $3,852,081 | $4,513,388 | $4,461,732 | $9,218 | ||||||||||||||||||||
Other Revenue(4) | 76,151 | 107,676 | 170,744 | 170,744 | 353 | ||||||||||||||||||||
Effective Gross Income | $3,432,697 | $3,959,757 | $4,684,132 | $4,632,476 | $9,571 | ||||||||||||||||||||
Total Operating Expenses | $1,743,247 | $1,654,907 | $2,239,029 | $2,229,683 | $4,607 | ||||||||||||||||||||
Net Operating Income | $1,689,449 | $2,304,850 | $2,445,103 | $2,402,793 | $4,964 | ||||||||||||||||||||
Replacement Reserves | 0 | 0 | 0 | 144,232 | 298 | ||||||||||||||||||||
Net Cash Flow | $1,689,449 | $2,304,850 | $2,445,103 | $2,258,561 | $4,666 |
(1) | Certain items such as straight line rent, interest expense, interest income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. | ||
(2) | The Chalet Gardens Apartments Property was acquired in 2012 by the prior owners as part of a distressed portfolio real estate acquisition. The prior owners invested approximately $3 million for structural repairs and unit renovations and increased occupancy from approximately 60% to 97.5% in 2014. | ||
(3) | Underwritten cash flow is based on the March 23, 2015 rent roll. | ||
(4) | Other Revenue includes late fees, pet fees, referral fees, application fees, MTM lease fees, cleaning fess, pool income, repair and maintenance charges and legal fee reimbursements. |
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n | Appraisal. According to the appraisal, the Chalet Garden Apartments Property had an “as-is” appraised value of $40,800,000 as of an effective date of April 14, 2015. |
n | Environmental Matters. According to a Phase I environmental report dated April 16, 2015, there is a historical recognized environmental condition at the Chalet Garden Apartments Property related to the prior use of the Chalet Garden Apartments Property as a landfill. Active methane monitoring systems have been installed on the ground floor of each of the 26 affected buildings at the Chalet Garden Apartments Property. There will be separate methane mitigation systems installed in the event that a monitoring alarm is triggered. Additionally, environmental insurance with aggregate coverage of $3,000,000 and a $50,000 deductible is currently in place through the term of the Chalet Garden Apartments Loan. The Phase I environmental report recommended no further investigation or other action. |
n | Market Overview and Competition. Primary regional access to the Pine Hill, New Jersey neighborhood is provided by US Route 30, Atlantic City Expressway, the New Jersey Turnpike and Interstate 295. US Route 30 and the Atlantic City Expressway extend in a southeast/northwest direction, providing direct access to the Philadelphia central business district. The New Jersey Turnpike and Interstate 295 provide access to New Jersey. The unemployment rate within the Philadelphia metropolitan statistical area was 5.0% as of December 2014 as compared to 5.8% for the state of New Jersey. |
The 2015 estimated population within a one-, three-, and five-mile radius of the Chalet Garden Apartments Property is 9,139, 78,634, and 191,335, respectively. The 2015 average household income within a one-, three-, and five-mile radius is $61,778, $73,978, and $84,573. The neighborhood surrounding the Chalet Garden Apartments Property consists of a mix of commercial and residential uses. Retailers in the area are primarily located along Blackwood Clementon Road (approximately 1/2 mile north of the Chalet Garden Apartments Property), including grocery stores, convenience stores, and restaurants. Deptford Mall is the closest regional mall in the area and is located approximately seven miles northwest of the Chalet Garden Apartments Property. Anchored by JC Penney, Macy’s, Sears, and Boscov’s, Deptford Mall has 121 specialty stores encompassing approximately 1.0 million SF. | |
The following table presents certain information relating to the primary competition for the Chalet Garden Apartments Property: |
Competitive Set(1)
Chalet Garden Apartments | Chateau Ridge | Birchwood Gardens Quail Run | Cherrywood Apartments | Pine Valley Court | ||||||
Location | Pine Hill | Pine Hill | Lindenwold | Clementon | Clementon | |||||
Year Built | 1973 | 1967 | 1975 | 1970 | 1965 | |||||
Occupancy | 99.0%(2) | 97.0% | 97.0% | 92.0% | 90.0% | |||||
No. of Units | 484 | 255 | 216 | 460 | 132 | |||||
Distance | - | 0.7 miles | 0.9 miles | 2.0 miles | 0.8 miles |
(1) | Source: Appraisal. | ||
(2) | As provided by the borrower per the March 23, 2015 rent roll. |
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n | The Borrower. The borrower is Chalet Apartments 5774 LLC, a single-purpose, single-asset entity. Legal counsel to the borrower delivered a non-consolidation opinion in connection with the origination of the Chalet Garden Apartments Loan. The non-recourse carveout guarantor under the Chalet Garden Apartments Loan is Pinchos Shemano. |
n | Escrows. On the origination date of the Chalet Garden Apartments Loan, the borrower funded escrow reserves of approximately $748,326 with respect to required repairs, approximately $100,065 with respect to real estate taxes, $29,312 with respect to insurance, and $25,000 with respect to an environmental reserve. |
On each due date, the borrower is required to fund the following reserves with respect to the Chalet Garden Apartments Loan: (i) a tax and insurance reserve in an amount equal to one-twelfth of the amount that the lender estimates will be necessary to pay taxes and insurance over the then succeeding 12-month period; and (ii) a replacement reserve in an amount equal to approximately $12,019 ($298 per unit per year). | |
n | Lockbox and Cash Management. The Chalet Garden Apartments Loan requires a springing lockbox and a springing cash management, which will be established upon written notification from the lender to the lockbox bank. Upon the occurrence of a Cash Management Trigger Event (as defined below), the Chalet Garden Apartments Loan documents require the borrower to set up the account for the sole and exclusive benefit of the lender into which the borrower is required to deposit or cause to be deposited all revenue generated by the Chalet Garden Apartments Property. Following the occurrence of a Cash Management Trigger Event, the funds on deposit in the lockbox account are required to be transferred within one (1) business day to the cash management account under the control of the lender. On each due date after the occurrence of a Cash Management Trigger Event, the Chalet Garden Apartments Loan documents require that all amounts on deposit in the lockbox account be applied to the payment of debt service and funding of required monthly escrow for real estate taxes, insurance premiums, replacement reserves and interest accruing at the default rate. Upon the occurrence of a Cash Sweep Event (as defined below): (a) funds are required to be applied to the operating expenses set forth in the annual operating budget; (b) funds sufficient to pay for extraordinary or other operating expenses not included in the approved annual budget, if any, will be applied to a borrower-controlled account; and (c) all excess cash flow will be applied to the excess cash flow account if a Cash Sweep Event is in effect or to a borrower-controlled account if no Cash Sweep Event is in effect. |
A “Cash Management Trigger Event”means the occurrence of an event of default under the Chalet Garden Apartments Loan or any bankruptcy action of the borrower, guarantor or manager, or a Cash Management DSCR Trigger Event (as defined below). | |
A “Cash Management DSCR Trigger Event” means any time the debt service coverage ratio based on the trailing 12-month period preceding the event is less than 1.20x. | |
A “Cash Sweep Event” means the occurrence of an event of default under the Chalet Garden Apartments Loan or any bankruptcy action of the borrower, guarantor or manager, or a Cash Sweep DSCR Trigger Event (as defined below). | |
A “Cash Sweep DSCR Trigger Event”means any time the debt service coverage ratio based on the trailing 12-month period preceding the event is less than 1.15x. |
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n | Property Management. The Chalet Garden Apartments Property is currently managed by David Stern Management Corp. pursuant to a management agreement. The Chalet Garden Apartments Loan documents provide that the borrower may terminate the property manager or consent to the assignment of the property manager’s rights under the management agreement, in each case, to the extent that: (i) no event of default under the Chalet Garden Apartments Loan has occurred and is continuing; (ii) the property manager is in default under the management agreement beyond any applicable notice and cure period; (iii) the property manager becomes insolvent or a debtor in any bankruptcy action; (iv) at any time the property manager has engaged in negligence, fraud, willful misconduct or misappropriation of funds; and/or (v) at any time the debt service coverage ratio (based on the trailing 12-month period immediately preceding the date of such determination) is less than 1.20x. |
n | Mezzanine or Subordinate Indebtedness. Not permitted. |
n | Terrorism Insurance. The borrower is required to maintain an “all-risk” insurance policy that provides coverage for terrorism in an amount equal to the full replacement cost of the Chalet Garden Apartments Property, plus 12 months of business interruption coverage as calculated under the Chalet Garden Apartments Loan documents (with an additional extended period of indemnity as reasonably required by the lender) in an amount equal to 100% of the projected gross income from the Chalet Garden Apartments Property (on an actual loss sustained basis) for a period continuing until the restoration of the Chalet Garden Apartments Property is completed and containing an extended period endorsement which provides for up to six months of additional coverage. The terrorism insurance is required to contain a deductible that is acceptable to the lender and is no larger than $25,000. See “Risk Factors—Terrorism Insurance May Not Be Available for All Mortgaged Properties” in the Prospectus Supplement. |
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Mortgaged Property Information | Mortgage Loan Information | ||||
Number of Mortgaged Properties | 1 | Loan Seller | GSMC | ||
Location (City/State) | Orinda, California | Cut-off Date Principal Balance | $22,700,000 | ||
Property Type | Mixed Use | Cut-off Date Principal Balance per SF | $250.73 | ||
Size (SF) | 90,537 | Percentage of Initial Pool Balance | 3.1% | ||
Total Occupancy as of 5/13/2015(1) | 93.5% | Number of Related Mortgage Loans | None | ||
Owned Occupancy as of 5/13/2015(1) | 93.5% | Type of Security | Fee Simple | ||
Year Built / Latest Renovation | 1941 / 1989 | Mortgage Rate | 4.2790% | ||
Appraised Value | $31,800,000 | Original Term to Maturity (Months) | 120 | ||
Original Amortization Term (Months) | 360 | ||||
Original Interest Only Period (Months) | 60 | ||||
Underwritten Revenues | $3,497,975 | ||||
Underwritten Expenses | $1,423,202 | Escrows | |||
Underwritten Net Operating Income (NOI) | $2,074,773 | Upfront | Monthly | ||
Underwritten Net Cash Flow (NCF) | $1,965,545 | Taxes | $87,168 | $29,056 | |
Cut-off Date LTV Ratio | 71.4% | Insurance | $0 | $0 | |
Maturity Date LTV Ratio | 65.1% | Replacement Reserves(2) | $0 | $2,414 | |
DSCR Based on Underwritten NOI / NCF | 1.54x / 1.46x | TI/LC(3) | $0 | $10,417 | |
Debt Yield Based on Underwritten NOI / NCF | 9.1% / 8.7% | Other(4) | $1,437,266 | $0 |
Sources and Uses | |||||
Sources | $ | % | Uses | $ | % |
Loan Amount | $22,700,000 | 68.5% | Purchase Price | $31,340,206 | 94.6% |
Principal’s New Cash Contribution | 10,431,983 | 31.5 | Reserves | 1,524,434 | 4.6 |
Closing Costs | 267,343 | 0.8 | |||
Total Sources | $33,131,983 | 100.0% | Total Uses | $33,131,983 | 100.0% |
(1) | Total Occupancy and Owned Occupancy include 7,154 SF of space for three tenants (Bruce Jett Associates and Health Management Solutions, Coldwell Banker Residential and Ehaki Aloha LLC) that have executed leases but have not yet taken occupancy or begun paying rent. We cannot assure you that these tenants will take occupancy or begin paying rent as expected or at all. Total Occupancy and Owned Occupancy excluding the three tenants described above are both 85.6% as of May 13, 2015. |
(2) | Replacement Reserves are capped at $90,000. |
(3) | TI/LC reserves are capped at $350,000. |
(4) | Other upfront reserves represent a deferred maintenance reserve ($18,205), water intrusion repairs ($900,000) and an unfunded obligations reserve ($519,061). See “—Escrows” below. |
n | The Mortgage Loan.The mortgage loan (the “Orinda Square Loan”) is evidenced by a note in the original principal amount of $22,700,000 and is secured by a first mortgage encumbering the borrowers’ fee simple interest in a mixed use retail and office center located in Orinda, California (the “Orinda Square Property”). The Orinda Square Loan was originated by Goldman Sachs Mortgage Company on May 15, 2015 and represents approximately 3.1% of the Initial Pool Balance. The note evidencing the Orinda Square Loan has an outstanding principal balance as of the Cut-off Date of $22,700,000 and has an interest rate of 4.2790%per annum. The borrowers utilized the proceeds of the Orinda Square Loan to acquire the Orinda Square Property, fund reserves and pay origination costs. |
The Orinda Square Loan had an initial term of 120 months and has a remaining term of 119 months as of the Cut-off Date. The Orinda Square Loan requires monthly payments of interest only for the initial 60 months, followed by monthly payments of interest and principal sufficient to amortize the Orinda Square Loan over a 30-year amortization schedule. The scheduled maturity date of the Orinda Square Loan is the due date in June 2025. Voluntary prepayment of the Orinda Square Loan is prohibited prior to March 6, 2025. Provided that no event of default under the Orinda Square Loan is continuing, defeasance with direct, non-callable obligations of the United States of America is permitted at any time on or after the first due date following the second anniversary of the securitization Closing Date.
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n | The Mortgaged Property. The Orinda Square Property is a 90,537 SF mixed use retail and office center located in Orinda, California. Originally built in 1941, the Orinda Square Property was later expanded in 1989 to its current configuration on the northeast corner of Highway 24 and Camino Pablo. Orinda is located 20 miles northeast of San Francisco, and the Orinda Square Property is located off Highway 24 connecting the Bay Area to Lafayette and Walnut Creek. The breakdown between office and retail space based on rental income is 65.4% and 29.6%, respectively. Major tenants at the Orinda Square Property include Morgan Stanley (8,902 SF), Gillin, Jacobson, Ellis, Larsen, & Lucy (10,897 SF) and Alain Pinel Realtors (5,719 SF). Additionally, the Orinda Square Property features a vintage movie theater which was built in 1941 and was fully renovated and expanded to three screens in 1989. The theater represents approximately 4.3% of total rental revenue. As of May 13, 2015, Total Occupancy and Owned Occupancy for the Orinda Square Property were both 93.5%. |
The following table presents certain information relating to the major tenants (of which, certain tenants may have co-tenancy provisions) at the Orinda Square Property:
Ten Largest Owned Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating (Fitch/MIS/S&P)(1) | Tenant GLA | % of GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | Lease Expiration | Tenant Sales $ per SF / Screen | Occupancy Cost | Renewal / Extension Options | ||||||||||||||||
Morgan Stanley | A / A3 / A- | 8,902 | 9.8% | $492,675 | 17.3% | $55.34 | 12/31/2018 | NA | NA | 2, 5-year options | ||||||||||||||||
Gillin, Jacobson, Ellis, Larsen & Lucy | NR / NR / NR | 10,897 | 12.0 | 393,382 | 13.8 | 36.10 | 6/30/2018 | NA | NA | 1, 5-year option | ||||||||||||||||
Coldwell Banker Residential(2) | NR / NR / NR | 5,606 | 6.2 | 282,230 | 9.9 | 50.34 | 8/31/2020 | NA | NA | 1, 5-year option | ||||||||||||||||
Alain Pinel Realtors | NR / NR / NR | 5,719 | 6.3 | 245,974 | 8.6 | 43.01 | 2/29/2020 | NA | NA | 1, 5-year option | ||||||||||||||||
Wells Fargo Advisors | AA- / A2 / A+ | 3,886 | 4.3 | 153,886 | 5.4 | 39.60 | 4/30/2018 | NA | NA | 2, 5-year options | ||||||||||||||||
Bruce Jett Associates and Health Management Solutions(3) | NR / NR / NR | 3,003 | 3.3 | 136,937 | 4.8 | 45.60 | 7/31/2020 | NA | NA | 2, 2-year options | ||||||||||||||||
Old Republic Title | NR / Baa3 / BBB+ | 2,666 | 2.9 | 119,970 | 4.2 | 45.00 | 11/30/2020 | NA | NA | 1, 5-year option | ||||||||||||||||
Entourage Spa(4) | NR / NR / NR | 5,200 | 5.7 | 119,340 | 4.2 | 22.95 | 4/30/2024 | $289.10 | 13.4% | NA | ||||||||||||||||
Orinda Theatre | NR / NR / NR | 14,290 | 15.8 | 98,345 | 3.5 | 6.88 | 11/30/2022 | $350,341 | 13.5% | 2, 5-year options | ||||||||||||||||
Babcock & Brown | NR / NR / NR |
| 2,285 |
| 2.5 |
| 90,372 |
| 3.2 |
| 39.55 | 9/30/2018 | NA | NA | 1, 2-year option | |||||||||||
Ten Largest Owned Tenants | 62,454 | 69.0% | $2,133,111 | 75.0% | $34.15 | |||||||||||||||||||||
Remaining Owned Tenants | 22,222 | 24.5 | 710,697 | 25.0 | 31.98 | |||||||||||||||||||||
Vacant Spaces (Owned Space) |
| 5,861 |
| 6.5 |
| 0 |
| 0.0 |
| 0.00 | ||||||||||||||||
Total / Wtd. Avg. All Owned Tenants | 90,537 | 100.0% | $2,843,807 | 100.0% | $33.58 |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | Coldwell Banker Residential has executed a lease for an additional 2,996 SF (bringing its total to 5,606 SF) and is expected to take occupancy and begin paying rent on the additional space in September 2015. We cannot assure you the tenant will take occupancy or begin paying rent as expected or at all. The current tenant in the 2,996 SF space is expected to vacate in July 2015 and is contractually obligated to pay rent through lease expiration. |
(3) | Bruce Jett Associates and Health Management Solutions has an executed lease and is expected to take occupancy and begin paying rent in September 2015. We cannot assure you the tenant will take occupancy or begin paying rent as expected or at all. The current tenant in the space is expected to vacate in July 2015 and is contractually obligated to pay rent through lease expiration. |
(4) | Entourage Spa has a one-time option to terminate its lease, effective April 30, 2019 upon 180 days’ notice and payment of a $70,000 termination fee. |
The following table presents certain information relating to the lease rollover schedule at the Orinda Square Property, based on initial lease expirations:
Lease Expiration Schedule(1)
Year Ending December 31, | Expiring Owned GLA | % of Owned GLA | Cumulative % of Owned GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | # of Expiring Tenants | ||||||||||||||
MTM | 1,121 | 1.2 | % | 1.2% | $19,203 | 0.7 | % | $17.13 | 1 | ||||||||||||
2015 | 433 | 0.5 | 1.7% | 12,730 | 0.4 | 29.40 | 1 | ||||||||||||||
2016 | 2,390 | 2.6 | 4.4% | 59,613 | 2.1 | 24.94 | 2 | ||||||||||||||
2017 | 3,836 | 4.2 | 8.6% | 97,679 | 3.4 | 25.46 | 4 | ||||||||||||||
2018 | 34,818 | 38.5 | 47.1% | 1,417,417 | 49.8 | 40.71 | 12 | ||||||||||||||
2019 | 2,940 | 3.2 | 50.3% | 105,436 | 3.7 | 35.86 | 2 | ||||||||||||||
2020 | 19,053 | 21.0 | 71.3% | 882,788 | 31.0 | 46.33 | 8 | ||||||||||||||
2021 | 0 | 0.0 | 71.3% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2022 | 14,885 | 16.4 | 87.8% | 129,601 | 4.6 | 8.71 | 2 | ||||||||||||||
2023 | 0 | 0.0 | 87.8% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2024 | 5,200 | 5.7 | 93.5% | 119,340 | 4.2 | 22.95 | 1 | ||||||||||||||
2025 | 0 | 0.0 | 93.5% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2026 & Thereafter | 0 | 0.0 | 93.5% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
Vacant | 5,861 | 6.5 | 100.0% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
Total / Wtd. Avg. | 90,537 | 100.0 | % | $2,843,807 | 100.0 | % | $33.58 | 33 |
(1) | Calculated based on approximate square footage occupied by each Owned Tenant. |
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The following table presents certain information relating to historical leasing at the Orinda Square Property:
Historical Leased %(1)
2012 | 2013 | 2014 | TTM 3/31/2015 | ||||||
Owned Space | 93.6% | 94.9% | 96.0% | 98.3% |
(1) | As provided by the borrowers and which represents occupancy as of December 31 for the indicated year, unless specified otherwise. | |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Orinda Square Property: |
Cash Flow Analysis(1)
2012 | 2013 | 2014 | TTM 3/31/2015 | Underwritten(2) | Underwritten $ per SF | ||||||||||||||
Base Rent | $2,239,126 | $2,673,948 | $2,541,722 | $2,605,799 | $2,843,807 | $31.41 | |||||||||||||
Overage Rent | 39,719 | 43,267 | 48,925 | 21,686 | 45,474 | 0.50 | |||||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 0 | 279,564 | 3.09 | |||||||||||||
Total Rent | $2,278,845 | $2,717,216 | $2,590,647 | $2,627,485 | $3,168,845 | $35.00 | |||||||||||||
Total Reimbursables | 452,742 | 527,787 | 500,695 | 468,087 | 418,204 | 4.62 | |||||||||||||
Parking Revenue | 200,617 | 188,257 | 166,144 | 168,708 | 168,708 | 1.86 | |||||||||||||
Other Income | 21,916 | 22,294 | 20,602 | 20,894 | 21,781 | 0.24 | |||||||||||||
Vacancy & Credit Loss | 0 | 0 | 0 | 0 | (279,564 | ) | (3.09 | ) | |||||||||||
Effective Gross Income | $2,954,119 | $3,455,553 | $3,278,087 | $3,285,174 | $3,497,975 | $38.64 | |||||||||||||
Total Operating Expenses | $1,240,118 | $1,297,826 | $1,369,331 | $1,353,708 | $1,423,202 | $15.72 | |||||||||||||
Net Operating Income | $1,714,001 | $2,157,727 | $1,908,755 | $1,931,466 | $2,074,773 | $22.92 | |||||||||||||
TI/LC | 0 | 0 | 0 | 0 | 80,257 | 0.89 | |||||||||||||
Capital Expenditures | 0 | 0 | 0 | 0 | 28,972 | 0.32 | |||||||||||||
Net Cash Flow | $1,714,001 | $2,157,727 | $1,908,755 | $1,931,466 | $1,965,545 | $21.71 |
(1) | Certain items such as straight line rent, interest expense, interest income, lease cancellation income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. |
(2) | Underwritten cash flow is based on the May 13, 2015 rent roll with rent steps through May 31, 2016. |
n | Appraisal. According to the appraisal dated as of May 4, 2015, the Orinda Square Property had an “as-is” appraised value of $31,800,000. |
n | Environmental Matters. According to a Phase I environmental report dated April 1, 2015, there are no recognized environmental conditions or recommendations for further action at the Orinda Square Property other than a recommendation for an asbestos operations and maintenance (O&M) plan. |
n | Market Overview and Competition. The Orinda Square Property is located in the Oakland-East Bay MSA. The subject market is defined by market data reports as 680 Corridor North, which includes the Lafayette/Moraga/Orinda (“Lamorinda”) submarket. The 680 Corridor North market is comprised of 7.4 million SF of retail shopping center space and 9.3 million SF of Class B office space with respective vacancy rates of 3.9% and 12.5%. The Lamorinda submarket is comprised of 903,212 SF of shopping center space and 1.2 million SF of Class B office space with respective vacancy rates of 2.1% and 7.4%. |
Competitive Office Comparables(1)
93 Moraga Way | 51 Moraga Way | 8 Camino Encinas | Orinda Towers | Clocktower | Desco Plaza I | ||||||||
Class | C | B | B | C | B | B | |||||||
Tenant Name | Heartsent Adoptions | Susan Harrell, CPA | Software Company | Available | Leamy Realty Group | Available | |||||||
Term | 7 | 2 | 3 | - | 5.0 | - | |||||||
Initial Rent/SF | $37.20 | $25.08 | $27.00 | $44.40 | $36.00 | $31.20 | |||||||
Tenant Improvements/SF | $20.00 | $0.00 | $4.00 | $0.00 | $0.00 | $0.00 |
(1) | Source: Appraisal. |
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Competitive Retail Comparables(1)
81 Moraga Way | Lafayette Town Center | La Fiesta Square | Danville Livery & Mercantile | Sycamore Square | 81 Moraga Way | ||||||||
Year Built | 1957 | 2004 | 1953 | 1983 | 1974 | 1957 | |||||||
Tenant Name | Supercuts | - | Douglah Designs | BZ Grill | Melo’s Pizza | Marleys Cabinets | |||||||
Term | 5 | 10 | 7.58 | 2 | 10 | 4 | |||||||
Initial Rent/SF | $36.00 | $42.00 | $33.00 | $37.44 | $30.00 | $31.80 | |||||||
Tenant Improvements/SF | $20.00 | $0.00 | $30.00 | $0.00 | $0.00 | $0.00 |
(1) | Source: Appraisal. |
n | The Borrowers.The borrowers are Orinda Dunhill LLC and DE Orinda Borrower LLC, each a single-purpose, single-asset entity, as tenants-in-common. Orinda Dunhill LLC has a 56.73% interest in the tenancy-in-common and DE Orinda Borrower LLC has a 43.27% interest. The non-recourse carveout guarantors under the Orinda Square Loan are William L. Hutchinson, an indirect owner of Orinda Dunhill LLC, and (with respect to certain actions by himself, DE Orinda Borrower LLC and the sole member of such borrower) Donald Engle, an indirect owner of DE Orinda Borrower LLC. |
n | Escrows.On the origination date, the borrowers funded (i) a tax reserve of approximately $87,168, (ii) a deferred maintenance reserve of $918,205 related to, among other things, repairs resulting from water leaks and resulting intrusion in various portions of the Orinda Square Property, and (iii) an unfunded obligations reserve of $519,061 related to unpaid tenant improvements, leasing commissions and free rent periods. |
On each due date, the borrowers will be required to fund (i) a tax and insurance reserve in an amount equal to one-twelfth of the amount that the lender reasonably estimates will be necessary to pay taxes and insurance premiums over the then succeeding 12-month period; provided, however, that reserve deposits for insurance premiums are not required if the borrowers are maintaining a blanket policy in accordance with the Orinda Square Loan documents and there is no continuing event of default, (ii) a tenant improvements and leasing commissions reserve in an amount equal to approximately $10,417 (subject to a cap of $350,000) and (iii) a capital expenditure reserve in the amount of approximately $2,414 (subject to a cap of $90,000).
In addition, on each due date during the continuance of an Orinda Square Trigger Period caused by an Orinda Square Rollover Trigger Event, the Orinda Square Loan documents require an excess cash reserve as discussed under “—Lockbox and Cash Management” below.
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ORINDA SQUARE |
An “Orinda Square Trigger Period” means any period: (i) commencing as of the conclusion of any 12-month period (ending on the last day of any fiscal quarter) during which the net operating income (as calculated under the Orinda Square Loan documents) is less than $1,607,676, and ending at the conclusion of the second consecutive fiscal quarter during which the net operating income for the trailing 12-month period (ending on the last day of any fiscal quarter) is equal to or greater than $1,607,676; (ii) commencing upon the borrowers’ failure to deliver monthly, quarterly or annual financial reports required under the Orinda Square Loan agreement and ending when such financial reports are delivered and they indicate that no other Orinda Square Trigger Period is ongoing; and (iii) commencing upon the occurrence of an Orinda Square Rollover Trigger Event and ending when either (a) in the case of any Orinda Square Rollover Trigger Event, the space is subject to one or more approved substitute leases, and the substitute tenant(s) is in occupancy and paying normal monthly rent, or (b)(1) in the case of any Orinda Square Rollover Trigger Event solely under clause (i) of that definition, the applicable Orinda Square Rollover Tenant enters a renewal or extension of its existing lease and is in occupancy, paying rent and open for business, (2) in the case of any Orinda Square Rollover Trigger Event solely under clause (ii) of that definition, the applicable Orinda Square Rollover Tenant has recommenced its business and operations in its space and is paying normal monthly rent and (3) in the case of any Orinda Square Rollover Trigger Event solely under clause (iii) of that definition, the applicable Orinda Square Rollover Tenant has affirmed its lease during the bankruptcy proceeding and is paying normal monthly rent.
An “Orinda Square Rollover Trigger Event” means the earlier of (i) the date that any of the Orinda Square Rollover Tenants gives notice of an intent to terminate or vacate all or a material portion of its space or fails to give notice to renew its lease as of the date that is the earlier of the date required pursuant to its lease and 6 months prior to the expiration of its lease, (ii) the date that any Orinda Square Rollover Tenant goes dark, discontinues its operations or business in all or substantially all of its space, vacates or is otherwise not in occupancy of all or substantially all of its space for a period of 30 consecutive days or more and excluding such events caused solely by casualty, condemnation, renovations or alterations undertaken pursuant to the terms of its lease, or (iii) the date of the filing of a bankruptcy petition by or against any Orinda Square Rollover Tenant or the guarantor, if any, under its lease.
An “Orinda Square Rollover Tenant” means Morgan Stanley, the law offices of Gillin, Jacobson, Ellis, Larsen & Doyle and any respective successor tenant.
n | Lockbox and Cash Management. The Orinda Square Loan is structured with a hard lockbox and springing cash management. The Orinda Square Loan documents require the borrowers to direct tenants to pay rent directly to a lender-controlled lockbox account and require that all cash revenues relating to the Orinda Square Property and all other money received by the borrowers or the property manager with respect to the Orinda Square Property (other than tenant security deposits) be deposited into such lockbox account or a lender-controlled cash management account within one business day following receipt. On each business day that no Orinda Square Trigger Period or event of default under the Orinda Square Loan is continuing, all funds in the lockbox account are required to be swept into a borrower-controlled operating account. On each business day during the continuance of an Orinda Square Trigger Period or an event of default under the Orinda Square Loan, all amounts in the lockbox account are required to be remitted to a lender-controlled cash management account. On each due date during the continuance of an Orinda Square Trigger Period or, at the lender’s discretion, during an event of default under the Orinda Square Loan, the related loan documents require that all amounts on deposit in the cash management account be used to pay debt service, required reserves and operating expenses, and that all remaining amounts be reserved in (i) an excess cash flow reserve account during the continuance of an Orinda Square Trigger Period (other than as described in clause (ii) below) or an event of default under the Orinda Square Loan or (ii) a rollover reserve account during the continuance of an Orinda Square Trigger Period caused by an Orinda Square Rollover Trigger Event (up to a cap of $500,000 if only one Orinda Square Rollover Tenant is subject to the Orinda Square Rollover Trigger Event). During the continuance of an event of default under the Orinda Square Loan, the lender may apply all funds on deposit in any of the accounts constituting collateral for the Orinda Square Loan to amounts payable under the Orinda Square Loan documents and/or toward the payment of expenses of the Orinda Square Property, in such order of priority as the lender may determine. |
n | Property Management.The Orinda Square Property is managed by Dunhill Partners West pursuant to a management agreement. Under the Orinda Square Loan documents, the Orinda Square Property is required to remain managed by (i) Dunhill Partners West, (ii) Dunhill Property Management, Inc., (iii) a third-party reputable and experienced property management company meeting certain experience requirements under the Orinda Square Loan documents or (iv) any other management company reasonably approved by the lender and with |
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ORINDA SQUARE |
respect to which a Rating Agency Confirmation has been received. The lender has the right to replace, or require the borrowers to replace, the property manager with a property manager selected by the lender (i) during the continuance of an event of default under the Orinda Square Loan, (ii) following any foreclosure, conveyance in lieu of foreclosure or other similar transaction, (iii) during the continuance of a material default by the property manager under the management agreement (after the expiration of any applicable notice and/or cure periods), (iv) if the property manager files for or is the subject of a petition in bankruptcy or (v) if a trustee or receiver is appointed for the property manager’s assets or the property manager makes an assignment for the benefit of its creditors or is adjudicated insolvent. |
n | Mezzanine or Secured Subordinate Indebtedness. Not permitted. |
n | Terrorism Insurance. So long as TRIPRA or a similar or subsequent statute is in effect, the borrowers are required to maintain terrorism insurance for foreign and domestic acts (as those terms are defined in TRIPRA or a similar or subsequent statute) in an amount equal to the full replacement cost of the Orinda Square Property (plus 12 months of rental loss and/or business interruption coverage plus an additional period of indemnity covering the six months following restoration). If TRIPRA or a similar or subsequent statute is not in effect, then provided that terrorism insurance is commercially available, the borrowers will be required to carry terrorism insurance throughout the term of the Orinda Square Loan as described in the preceding sentence, but in that event the borrowers will not be required to spend more than two times the amount of the insurance premium that is payable at that time in respect of the property and business interruption/rental loss insurance required under the Orinda Square Loan documents (without giving effect to the cost of terrorism and earthquake components of such property and business interruption/rental loss insurance), and if the cost of terrorism insurance exceeds such amount, then the borrowers will be required to purchase the maximum amount of terrorism insurance available with funds equal to such amount. In either such case, terrorism insurance may not have a deductible in excess of $50,000. The required terrorism insurance may be included in a blanket policy, provided that the borrowers provide evidence satisfactory to the lender that the insurance premiums for the Orinda Square Property are separately allocated to the Orinda Square Property and that the policy will provide the same protection as a separate policy. See “Risk Factors—Terrorism Insurance May Not Be Available for All Mortgaged Properties” in the Prospectus Supplement. |
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PARK AT SUGAR CREEK |
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PARK AT SUGAR CREEK |
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PARK AT SUGAR CREEK |
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PARK AT SUGAR CREEK |
Mortgaged Property Information | Mortgage Loan Information | |||||
Number of Mortgaged Properties | 1 | Loan Seller | GSMC | |||
Location (City/State) | Sugar Land, Texas | Cut-off Date Principal Balance | $22,700,000 | |||
Property Type | Mixed Use | Cut-off Date Principal Balance per SF | $161.85 | |||
Size (SF) | 140,254 | Percentage of Initial Pool Balance | 3.1% | |||
Total Occupancy as of 5/18/2015(1) | 87.9% | Number of Related Mortgage Loans | None | |||
Owned Occupancy as of 5/18/2015(1) | 87.9% | Type of Security | Fee Simple | |||
Year Built / Latest Renovation | 1985 / NAP | Mortgage Rate | 4.1065% | |||
Appraised Value | $29,900,000 | Original Term to Maturity (Months) | 120 | |||
Original Amortization Term (Months) | 360 | |||||
Original Interest Only Period (Months) | 24 | |||||
Underwritten Revenues | $3,074,556 | |||||
Underwritten Expenses | $809,582 | Escrows | ||||
Underwritten Net Operating Income (NOI) | $2,264,974 | Upfront | Monthly | |||
Underwritten Net Cash Flow (NCF) | $2,142,180 | Taxes | $129,591 | $21,599 | ||
Cut-off Date LTV Ratio | 75.9% | Insurance | $62,615 | $11,195 | ||
Maturity Date LTV Ratio(2) | 63.3% | Replacement Reserve | $0 | $1,750 | ||
DSCR Based on Underwritten NOI / NCF | 1.72x / 1.63x | TI/LC(3) | $0 | $10,000 | ||
Debt Yield Based on Underwritten NOI / NCF | 10.0% / 9.4% | Other(4) | $726,202 | $0 |
Sources and Uses | ||||||
Sources | $ | % | Uses | $ | % | |
Loan Amount | $22,700,000 | 100.0% | Loan Payoff | $10,762,624 | 47.4 | % |
Principal Equity Distribution | 10,656,068 | 46.9 | ||||
Reserves | 918,408 | 4.0 | ||||
Closing Costs | 362,900 | 1.6 | ||||
Total Sources | $22,700,000 | 100.0% | Total Uses | $22,700,000 | 100.0 | % |
(1) | Total Occupancy and Owned Occupancy include (i) Plaza Jewelers (10,062 SF) which is temporarily occupying 5,981 SF of in-line space until the build-out of its outparcel is complete (expected at the end of June 2015) and (ii) Majestic Kids (6,003 SF) which has executed a lease, but has not yet opened for business or begun paying rent. We cannot assure you that these tenants will take occupancy or begin paying rent as expected or at all. Total Occupancy and Owned Occupancy including only the temporary space occupied by Plaza Jewelers and excluding Majestic Kids and are both 80.7%. |
(2) | The Maturity Date LTV Ratio is calculated utilizing the “as stabilized” appraised value of $30,300,000. The Maturity Date LTV Ratio, calculated on the basis of the “as-is” appraised value of $29,900,000, is 64.1%. See“—Appraisal”below. |
(3) | The TI/LC reserve is capped at $300,000. See“—Escrows” below. |
(4) | Other upfront reserve represents an unfunded obligation reserve ($586,075), deferred maintenance ($120,654) and an environmental reserve ($19,473). See“—Escrows” below. |
n | The Mortgage Loan. The mortgage loan (the “Park at Sugar Creek Loan”) is evidenced by a note in the original principal amount of $22,700,000 and is secured by a first mortgage encumbering the borrowers’ fee simple interest in a mixed use retail and office center located in Sugar Land, Texas (the “Park at Sugar Creek Property”). The Park at Sugar Creek Loan was originated by Goldman Sachs Mortgage Company on May 29, 2015 and represents approximately 3.1% of the Initial Pool Balance. The note evidencing the Park at Sugar Creek Loan has an outstanding principal balance as of the Cut-off Date of $22,700,000 and an interest rate of 4.1065%per annum. The borrowers utilized the proceeds of the Park at Sugar Creek Loan to refinance the existing debt on the Park at Sugar Creek Property, return equity to the borrower sponsors, fund reserves and pay origination costs. |
The Park at Sugar Creek Loan had an initial term of 120 months and has a remaining term of 119 months as of the Cut-off Date. The Park at Sugar Creek Loan requires monthly payments of interest only for the initial 24 months, followed by monthly payments of interest and principal sufficient to amortize the Park at Sugar Creek Loan over a 30-year amortization schedule. The scheduled maturity date is the due date in June 2025. Voluntary prepayment of the Park at Sugar Creek Loan is prohibited prior to March 6, 2025. Provided that no event of default is continuing, defeasance with direct, non-callable obligations of the United States of America is permitted at any time on or after the first due date following the second anniversary of the securitization Closing Date.
n | The Mortgaged Property.The Park at Sugar Creek Property is an approximately 140,254 SF mixed use retail and office center located in Sugar Land, Texas. The Park at Sugar Creek Property is in the Sugar Creek master planned community in Fort Bend County, directly off of Highway 69 and one-half mile from the Highway 69 and Highway 90 intersection. Highway 69 connects the Park at Sugar Creek Property to downtown Houston in approximately 20 miles. As of May 18, 2015, Total Occupancy and Owned Occupancy at the Park at Sugar Creek Property were both 87.9%. |
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The following table presents certain information relating to the major tenants (of which, certain tenants may have co-tenancy provisions) at the Park at Sugar Creek Property:
Ten Largest Owned Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating (Fitch/MIS/S&P)(1) | Tenant | % of Owned GLA | UW Base Rent | % of | UW Base | Lease Expiration | Tenant | Occupancy Cost | Renewal / Extension Options | |||||||||||||
Memorial Hermann | NR / NR / NR | 40,283 | 28.7 | % | $604,245 | 26.5 | % | $15.00 | 8/31/2027 | NA | NA | NA | |||||||||||
Plaza Jewelers(2) | NR / NR / NR | 10,062 | 7.2 | 241,488 | 10.6 | 24.00 | 6/30/2030 | NA | NA | 1, 5-year option | |||||||||||||
JP Morgan Chase Bank, N.A. | A+ / A3 / A | 4,000 | 2.9 | 192,000 | 8.4 | 48.00 | 3/31/2025 | NA | NA | 2, 5-year options | |||||||||||||
Majestic Kids(3) | NR / NR / NR | 6,003 | 4.3 | 110,215 | 4.8 | 18.36 | 10/31/2020 | NA | NA | NA | |||||||||||||
TX3rd Coast MMA | NR / NR / NR | 5,600 | 4.0 | 90,761 | 4.0 | 16.21 | 12/31/2016 | NA | NA | NA | |||||||||||||
Bullpen Pizza Sports Bar | NR / NR / NR | 4,104 | 2.9 | 85,396 | 3.7 | 20.81 | 10/31/2019 | NA | NA | NA | |||||||||||||
Mosset Grille Urban Wine Bar, LLC | NR / NR / NR | 3,742 | 2.7 | 65,736 | 2.9 | 17.57 | 10/31/2018 | NA | NA | 1, 5-year option | |||||||||||||
Hote Pointe, Inc. | NR / NR / NR | 3,500 | 2.5 | 65,100 | 2.9 | 18.60 | 10/31/2019 | NA | NA | 1, 5-year option | |||||||||||||
Dr. Mark Littman, DDS | NR / NR / NR | 3,104 | 2.2 | 57,548 | 2.5 | 18.54 | (4) | NA | NA | NA | |||||||||||||
Sugar Creek Animal Clinic | NR / NR / NR | 2,052 | 1.5 |
| 55,861 | 2.4 |
| 27.22 | 1/31/2019 | NA | NA | NA | |||||||||||
Ten Largest Owned Tenants | �� | 82,450 | 58.8 | % | $1,568,351 | 68.8 | % | $19.02 | |||||||||||||||
Remaining Owned Tenants | 40,790 | 29.1 | 712,489 | 31.2 | 17.47 | ||||||||||||||||||
Vacant Spaces (Owned Space) | 17,014 | 12.1 |
| 0 | 0.0 |
| 0.00 | ||||||||||||||||
Total / Wtd. Avg. All Owned Tenants | 140,254 | 100.0 | % | $2,280,840 | 100.0 | % | $18.51 |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | Plaza Jewelers is building out its 10,062 SF outparcel space and is temporarily occupying 5,981 SF for display and storage until the build-out of its outparcel is complete. The tenant is expected to take occupancy of the outparcel space at the end of June 2015 and begin paying rent in July 2015. |
(3) | Majestic Kids has executed a lease, but has not yet opened for business or begun paying rent. It is expected to open for business and begin paying rent in November 2015. We cannot assure you that this tenant will take occupancy or begin paying rent as expected or at all. |
(4) | Dr. Mark Littman, DDS has two leases: 1,522 SF ($17.30 UW Base Rent per SF) expiring May 31, 2017 and 1,522 SF ($19.78 UW Base Rent per SF) expiring May 31, 2020. |
The following table presents certain information relating to the lease rollover schedule at the Park at Sugar Creek Property, based on initial lease expiration dates:
Lease Expiration Schedule(1)
Year Ending | Expiring | % of Owned GLA | Cumulative % of | UW Base Rent | % of Total UW | UW Base Rent | # of Expiring | ||||||||||||||||||
MTM | 0 | 0.0 | % | 0.0% | $0 | 0.0 | % | $0.00 | 0 | ||||||||||||||||
2015 | 5,950 | 4.2 | 4.2% | 96,935 | 4.2 | 16.29 | 3 | ||||||||||||||||||
2016 | 8,271 | 5.9 | 10.1% | 145,910 | 6.4 | 17.64 | 3 | ||||||||||||||||||
2017 | 9,421 | 6.7 | 16.9% | 160,768 | 7.0 | 17.06 | 5 | ||||||||||||||||||
2018 | 16,279 | 11.6 | 28.5% | 280,692 | 12.3 | 17.24 | 7 | ||||||||||||||||||
2019 | 14,976 | 10.7 | 39.1% | 294,872 | 12.9 | 19.69 | 6 | ||||||||||||||||||
2020 | 11,341 | 8.1 | 47.2% | 217,420 | 9.5 | 19.17 | 4 | ||||||||||||||||||
2021 | 0 | 0.0 | 47.2% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||||||
2022 | 0 | 0.0 | 47.2% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||||||
2023 | 2,657 | 1.9 | 49.1% | 46,510 | 2.0 | 17.50 | 1 | ||||||||||||||||||
2024 | 0 | 0.0 | 49.1% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||||||
2025 | 4,000 | 2.9 | 52.0% | 192,000 | 8.4 | 48.00 | 1 | ||||||||||||||||||
2026 & Thereafter | 50,345 | 35.9 | 87.9% | 845,733 | 37.1 | 16.80 | 3 | ||||||||||||||||||
Vacant | 17,014 |
| 12.1 |
| 100.0% | 0 |
| 0.0 |
| 0.00 |
| 0 |
| ||||||||||||
Total / Wtd. Avg. | 140,254 | 100.0 | % | $2,280,840 | 100.0 | % | $18.51 | 33 | |||||||||||||||||
(1) | Calculated based on the approximate square footage occupied by each Owned Tenant. |
The following table presents certain information relating to historical leasing at the Park at Sugar Creek Property:
Historical Leased %(1)
| 2012 | 2013 | 2014 | TTM 4/30/2015(2) | ||||
Owned Space | 85.4% | 85.6% | 86.6% | 87.9% | ||||
(1) | As provided by the borrowers and which represents average monthly occupancy for the indicated year unless specified otherwise. |
(2) | Includes (i) Plaza Jewelers (10,062 SF) which is temporarily occupying 5,981 SF of space until the build-out of its outparcel is complete (expected at the end of June 2015) and (ii) Majestic Kids (6,003 SF) which has executed a lease, but has not yet opened for business or begun paying rent. We cannot assure you that these tenants will take occupancy or begin paying rent as expected or at all. Total Occupancy and Owned Occupancy including only the temporary space occupied by Plaza Jewelers and excluding Majestic Kids and are both 80.7%. |
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n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Park at Sugar Creek Property: |
Cash Flow Analysis(1)
2012 | 2013 | 2014 | TTM 4/30/2015 | Underwritten | Underwritten $ per SF | |||||||||||||
Base Rent(2) | $1,879,855 | $1,901,591 | $2,019,852 | $1,963,369 | $2,280,840 | $16.26 | ||||||||||||
Contractual Credit Rent Step(3) | 0 | 0 | 0 | 0 | 101,946 | 0.73 | ||||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 0 | 392,624 | 2.80 | ||||||||||||
Total Rent | $1,879,855 | $1,901,591 | $2,019,852 | $1,963,369 | $2,775,409 | $19.79 | ||||||||||||
Total Reimbursables | 575,916 | 591,592 | 658,362 | 619,325 | 682,000 | 4.86 | ||||||||||||
Other Income | 10,404 | 19,759 | 19,514 | 21,039 | 9,770 | 0.07 | ||||||||||||
Vacancy & Credit Loss | 0 | 0 | 0 | 0 | (392,624 | ) | (2.80 | ) | ||||||||||
Effective Gross Income | $2,466,175 | $2,512,942 | $2,697,728 | $2,603,733 | $3,074,556 | $21.92 | ||||||||||||
Total Operating Expenses | $784,835 | $731,450 | $765,838 | $803,622 | $809,582 | $5.77 | ||||||||||||
Net Operating Income | $1,681,340 | $1,781,492 | $1,931,891 | $1,800,111 | $2,264,974 | $16.15 | ||||||||||||
TI/LC | 0 | 0 | 0 | 0 | 101,755 | 0.73 | ||||||||||||
Capital Expenditures | 0 | 0 | 0 | 0 | 21,038 | 0.15 | ||||||||||||
Net Cash Flow | $1,681,340 | $1,781,492 | $1,931,891 | $1,800,111 | $2,142,180 | $15.27 |
(1) | Certain items such as straight line rent, interest expense, interest income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. |
(2) | Underwritten cash flow is based on contractual rents as of May 18, 2015 and rent steps through June 30, 2016. |
(3) | The Underwritten Contractual Credit Rent Step line item is the straight-line average of the 2017 contractual rent step for Memorial Hermann. |
n | Appraisal. According to the appraisal, the Park at Sugar Creek Property had an “as-is” appraised value of $29,900,000 as of April 17, 2015 and an “as stabilized” appraised value of $30,300,000 as of October 17, 2015 assuming stabilized occupancy. |
n | Environmental Matters. According to a Phase I environmental report dated April 24, 2015, an environmental consultant identified an active dry cleaner facility as a recognized environmental condition at the Park at Sugar Creek Property, based on the continued use of chlorinated solvents since the time of the most recent subsurface investigation in 1996. The environmental consultant recommended further investigation at the tenant space. The Park at Sugar Creek Loan documents require the borrowers to complete a Phase II within 90 days of the origination of the Park at Sugar Creek Loan to determine if any remediation is necessary. In addition, the environmental consultant recommended that a 55-gallon unlabeled drum be disposed of off-site in accordance with applicable regulations. |
n | Market Overview and Competition. The Park at Sugar Creek Property is in the Sugar Creek master planned community in Fort Bend County, Texas. As of 2015, the population within a five-mile radius of the Park at Sugar Creek Property was 278,008 with an average household income of $98,281. According to a first quarter 2015 market research report, the Southwest Houston Retail submarket contains approximately 17.8 million SF of retail space with a reported vacancy rate of 9.3%. |
The following table presents certain information relating to the primary competition for the Park at Sugar Creek Property:
Competitive Set(1)
| Park at Sugar Creek | First Colony | The Village at Lexington Colony | New Territory | Sugar Creek Village | ||||||
Distance from Subject | - | 4.3 miles | 2.6 miles | 4.1 miles | 0.4 miles | ||||||
Property Type | Retail | Retail | Retail | Retail | Retail | ||||||
Year Built | 1985 | 1993 | 1993 | 1999 | 1980 | ||||||
Total GLA | 140,254 | 111,675 | 60,822 | 26,581 | 130,976 | ||||||
Total Occupancy | 87.9% | 96% | 98% | 84% | 89% | ||||||
Major Tenants | Memorial Hermann Plaza Jewelers | Subway, Smoothie Factory | Embody Fitness | Papa John’s, State Farm | CVS Pharmacy |
(1) | Source: Appraisal. |
n | The Borrowers. The borrowers are KFLP Partnership, Ltd. and JDLP, Ltd., each a single-purpose, single-asset entity, as tenants-in-common. KFLP Partnership, Ltd. and JDLP, Ltd. each have a 50% undivided interest in the |
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tenancy-in-common. Kamran Farhadi, an indirect owner of KFLP Partnership, Ltd., and James R. Damavandi, an indirect owner of JDLP, Ltd., are the non-recourse carveout guarantors under the Park at Sugar Creek Loan. |
Each tenant in common borrower is controlled directly or indirectly by the separate sponsors (Kamran Farhadi and James R. Damavandi) who have done business together. The borrowers have waived their right to partition the Park at Sugar Creek Property. Mr. Farhadi has been in the real estate business for over 30 years, and he currently owns approximately 530,000 SF of retail space and 243 residential units throughout the United States.
n | Escrows. On the origination date, the borrowers funded (i) a tax reserve of $129,591, (ii) an insurance reserve of $62,615, (iii) a deferred maintenance and environmental reserve of $140,127 related to, among other things, roof repairs and the completion of the Phase II and any resulting remediation referred to under “—Environmental Matters” above and (iv) an unfunded obligations reserve of approximately $586,075 related to unpaid tenant improvements and leasing commissions and free rent periods. |
On each due date, the borrowers will be required to fund (i) a tax and insurance reserve in an amount equal to one-twelfth of the amount that the lender reasonably estimates will be necessary to pay taxes and insurance premiums over the then succeeding 12-month period, (ii) a tenant improvements and leasing commissions reserve in an amount equal to $10,000 (subject to a cap of $300,000) and (iii) a capital expenditure reserve in the amount of $1,750.
In addition, on each due date during the continuance of a Park at Sugar Creek Trigger Period, the Park at Sugar Creek Loan documents require an excess cash reserve as discussed under “—Lockbox and Cash Management” below.
A “Park at Sugar Creek Trigger Period” means any period (i) commencing as of the conclusion of any 12-month period (ending on the last day of any fiscal quarter) during which the net operating income (as calculated under the related loan documents) is less than $1,735,298.40, and ending at the conclusion of the second consecutive fiscal quarter during which the net operating income for the trailing 12-month period (ending on the last day of any fiscal quarter) is equal to or greater than $1,735,298.40 and (ii) commencing upon the borrowers’ failure to deliver monthly, quarterly or annual financial reports and ending when such reports are delivered and indicate that no other Park at Sugar Creek Trigger Period is ongoing.
n | Lockbox and Cash Management. The Park at Sugar Creek Loan is structured with a springing lockbox and springing cash management. Upon the occurrence of a Park at Sugar Creek Trigger Period or event of default under the Park at Sugar Creek Loan, the related loan documents permit the lender to deliver notices to each tenant instructing them to remit all rents into a lender-controlled lockbox account and require that all cash revenues relating to the Park at Sugar Creek Property and all other money received by the borrowers or the property manager with respect to the Park at Sugar Creek Property (other than tenant security deposits) be deposited into such lockbox account within one business day following receipt. On each business day during the continuance of a Park at Sugar Creek Trigger Period or an event of default under the Park at Sugar Creek Loan, all amounts in the lockbox account are required to be remitted to a lender-controlled cash management account. To the extent any Park at Sugar Creek Trigger Period expires or an event of default under the Park at Sugar Creek Loan is cured, all funds in the lockbox account are required to be swept into a borrower-controlled operating account. |
On each due date during the continuance of a Park at Sugar Creek Trigger Period or, at the lender’s discretion, during an event of default under the Park at Sugar Creek Loan, the related loan documents require that all amounts on deposit in the cash management account be used to pay debt service, required reserves and budgeted operating expenses, and that all remaining amounts be reserved in an excess cash flow reserve account. During the continuance of an event of default under the Park at Sugar Creek Loan, the lender may apply all funds on deposit in any of the accounts constituting collateral for the Park at Sugar Creek Loan to amounts payable under the related loan documents and/or toward the payment of expenses of the Park at Sugar Creek Property, in such order of priority as the lender may determine.
n | Property Management. The Park at Sugar Creek Property is managed by CJ Park & Associates, LLC (which is owned by Kamran Farhadi, an indirect owner of one of the borrowers) pursuant to a management agreement. Under the Park at Sugar Creek Loan documents, the Park at Sugar Creek Property is required to be managed by CJ Park & Associates, LLC, or any other management company approved by the lender and with respect to which a Rating Agency Confirmation has been received. The lender has the right to replace, or require the borrowers to replace, the property manager with a property manager selected by the lender (i) during the |
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continuance of an event of default under the Park at Sugar Creek Loan, (ii) following any foreclosure, conveyance in lieu of foreclosure or other similar transaction, (iii) during the continuance of a material default by the property manager under the management agreement (after the expiration of any applicable notice and/or cure periods), (iv) if the property manager files for or is the subject of a petition in bankruptcy or (v) if a trustee or receiver is appointed for the property manager’s assets or the property manager makes an assignment for the benefit of its creditors or is adjudicated insolvent. |
n | Mezzanine or Secured Subordinate Indebtedness.Not permitted. |
n | Terrorism Insurance. So long as TRIPRA or a similar or subsequent statute is in effect, the borrowers are required to maintain terrorism insurance for foreign and domestic acts (as those terms are defined in TRIPRA or similar or subsequent statute) in an amount equal to the full replacement cost of the Park at Sugar Creek Property (plus 18 months of rental loss and/or business interruption coverage plus an additional period of indemnity covering the 12 months following restoration). If TRIPRA or a similar or subsequent statute is not in effect, then provided that terrorism insurance is commercially available, the borrowers will be required to carry terrorism insurance throughout the term of the Park at Sugar Creek Loan as described in the preceding sentence, but in that event the borrowers will not be required to spend more than two times the amount of the insurance premium that is payable at that time in respect of the property and business interruption/rental loss insurance required under the related loan documents (without giving effect to the cost of terrorism and earthquake components of such property and business interruption/rental loss insurance), and if the cost of terrorism insurance exceeds such amount, then the borrowers will be required to purchase the maximum amount of terrorism insurance available with funds equal to such amount. In either such case, terrorism insurance may not have a deductible in excess of $50,000. The required terrorism insurance may be included in a blanket policy, provided that the borrowers provide evidence satisfactory to the lender that the insurance premiums for the Park at Sugar Creek Property are separately allocated to the Park at Sugar Creek Property and that the policy will provide the same protection as a separate policy. See “Risk Factors—Terrorism Insurance May Not Be Available for All Mortgaged Properties” in the Prospectus Supplement. |
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Mortgaged Property Information | Mortgage Loan Information | ||||||||
Number of Mortgaged Properties | 1 | Loan Seller | GSMC | ||||||
Location (City/State) | San Diego, California | Cut-off Date Principal Balance | $22,200,000 | ||||||
Property Type | Retail | Cut-off Date Principal Balance per SF | $157.81 | ||||||
Size (SF) | 140,676 | Percentage of Initial Pool Balance | 3.1% | ||||||
Total Occupancy as of 3/19/2015 | 90.9% | Number of Related Mortgage Loans | None | ||||||
Owned Occupancy as of 3/19/2015 | 90.9% | Type of Security | Fee Simple | ||||||
Year Built / Latest Renovation | 1972-1975 / 2005 | Mortgage Rate | 3.9010% | ||||||
Appraised Value | $48,000,000 | Original Term to Maturity (Months) | 120 | ||||||
Original Amortization Term (Months) | NAP | ||||||||
Original Interest Only Period (Months) | 120 | ||||||||
Underwritten Revenues | $3,458,093 | ||||||||
Underwritten Expenses | $865,068 | Escrows | |||||||
Underwritten Net Operating Income (NOI) | $2,593,025 | Upfront | Monthly | ||||||
Underwritten Net Cash Flow (NCF) | $2,452,832 | Taxes | $114,021 | $28,505 | |||||
Cut-off Date LTV Ratio | 46.3% | Insurance | $0 | $0 | |||||
Maturity Date LTV Ratio | 46.3% | Replacement Reserve | $0 | $3,400 | |||||
DSCR Based on Underwritten NOI / NCF | 2.95x / 2.79x | TI/LC | $0 | $0 | |||||
Debt Yield Based on Underwritten NOI / NCF | 11.7% / 11.0% | Other(1) | $42,185 | $0 | |||||
Sources and Uses | |||||||||
Sources | $ | % | Uses | $ | % | ||||
Loan Amount | $22,200,000 | 100.0% | Loan Payoff | $19,234,929 | 86.6% | ||||
Principal Equity Distribution | 2,531,256 | 11.4 | |||||||
Closing Costs | 277,609 | 1.3 | |||||||
Reserves | 156,206 | 0.7 | |||||||
Total Sources | $22,200,000 | 100.0% | Total Uses | $22,200,000 | 100.0% | ||||
(1) | Other upfront reserve represents a deferred maintenance reserve ($41,195) and an environmental reserve ($990). See “—Escrows” below. | |
n | The Mortgage Loan. The mortgage loan (the “Mesa Town Center Loan”) is evidenced by a note in the original principal amount of $22,200,000 and is secured by a first mortgage encumbering the borrower’s fee simple interest in a retail property located in San Diego, California (the “Mesa Town Center Property”). The Mesa Town Center Loan was originated by Goldman Sachs Mortgage Company on May 8, 2015 and represents approximately 3.1% of the Initial Pool Balance. The note evidencing the Mesa Town Center Loan has a principal balance as of the Cut-off Date of $22,200,000 and an interest rate of 3.9010%per annum. The borrower utilized the proceeds of the Mesa Town Center Loan to refinance the existing debt on the Mesa Town Center Property, return equity to the borrower sponsor, fund reserves and pay origination costs. |
The Mesa Town Center Loan had an initial term of 120 months and has a remaining term of 119 months as of the Cut-off Date. The Mesa Town Center Loan requires monthly payments of interest only during its term. The scheduled maturity date is the due date in June 2025. The Mesa Town Center Loan may be voluntarily prepaid in whole at any time on or after the due date in June 2016 with the payment of a prepayment fee equal to the greater of (i) a yield maintenance premium calculated based on the excess, if any, of the present values of the remaining scheduled principal and interest payments, over the principal amount being prepaid and (ii) 1% of the principal amount being prepaid. Voluntary prepayment of the Mesa Town Center Loan is permitted on and after March 6, 2025 without payment of any yield maintenance or prepayment premium.
n | The Mortgaged Property.The Mesa Town Center Property is an approximately 140,676 SF anchored retail center located in San Diego, California. The collateral consists of 6 buildings which were constructed from 1972 to 1975 and renovated in 2005 and is leased to 30 tenants including national and regional tenants such as Albertsons (Seafood City), Rite Aid, JP Morgan Chase and McDonald’s. The borrower sponsor purchased the Mesa Town Center Property in 2005 for $27.3 million. As of March 19, 2015, Total Occupancy and Owned Occupancy at the Mesa Town Center Property were both 90.9%. |
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The following table presents certain information relating to the major tenants (of which, certain tenants may have co-tenancy provisions) at the Mesa Town Center Property:
Ten Largest Owned Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating (Fitch/MIS/S&P)(1) | Tenant | % of | UW Base | % of | UW Base | Lease | Tenant | Occupancy | Renewal / | ||||||||||||
JP Morgan Chase | A+ / A3 / A | 6,500 | 4.6 | % | $271,700 | 10.1 | % | $41.80 | 6/30/2019 | NA | NA | 3, 5-year options | ||||||||||
Rite Aid | B / B3 / B | 21,440 | 15.2 | 257,280 | 9.6 | 12.00 | 5/31/2019 | $293.60 | 5.8% | 2, 5-year options | ||||||||||||
Albertsons (Seafood City)(3) | NR / NR / NR | 32,745 | 23.3 | 229,900 | 8.5 | 7.02 | 11/30/2019 | NA | NA | 2, 5-year options | ||||||||||||
Discount Tires | NR / NR / NR | 6,585 | 4.7 | 179,217 | 6.7 | 27.22 | 12/31/2020 | NA | NA | 4, 5-year options | ||||||||||||
Community Dental | NR / NR / NR | 5,373 | 3.8 | 154,201 | 5.7 | 28.70 | 1/31/2020 | $276.48 | 12.3% | 1, 5-year option | ||||||||||||
The Boiling Crab | NR / NR / NR | 4,478 | 3.2 | 150,998 | 5.6 | 33.72 | 2/25/2022 | NA | NA | 2, 5-year options | ||||||||||||
Siam Nara | NR / NR / NR | 4,000 | 2.8 | 116,184 | 4.3 | 29.05 | 11/30/2015 | $357.60 | 9.8% | 1, 5-year option | ||||||||||||
McDonald’s | BBB+ / A3 / A- | 2,913 | 2.1 | 124,500 | 4.6 | 42.74 | 6/6/2034 | NA | NA | 3, 5-year options | ||||||||||||
The Sherwin Williams Store | A- / A3 / A | 3,152 | 2.2 | 99,855 | 3.7 | 31.68 | 4/30/2017 | NA | NA | 2, 5-year options | ||||||||||||
Mesa Liquor | NR / NR / NR | 3,450 | 2.5 | 86,112 | 3.2 | 24.96 | 11/30/2021 | $229.45 | 13.5% | 2, 5-year options | ||||||||||||
Ten Largest Owned Tenants | 90,636 | 64.4 | % | $1,669,948 | 62.1 | % | $18.42 | |||||||||||||||
Remaining Owned Tenants | 37,276 | 26.5 | 1,020,617 | 37.9 | 27.38 | |||||||||||||||||
Vacant Spaces (Owned Space) | 12,764 | 9.1 | 0 | 0.0 | 0.00 | |||||||||||||||||
Total / Wtd. Avg. All Owned Tenants | 140,676 | 100.0 | % | $2,690,565 | 100.0 | % | $21.03 |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | Tenant Sales are as of December 31, 2014. |
(3) | Seafood City currently subleases its space directly from Albertsons and has been in occupancy since 2000 and is not required to report sales. Underwritten Base Rent reflects the terms of the Albertsons lease. |
The following table presents certain information relating to the lease rollover schedule at the Mesa Town Center Property, based on initial lease expiration dates:
Lease Expiration Schedule(1)
Year Ending December 31, | Expiring Owned GLA | % of Owned | Cumulative % of Owned GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | # of Expiring Tenants | ||||||||||||||
MTM | 2,500 | 1.8 | % | 1.8 | % | $73,034 | 2.7 | % | $29.21 | 1 | |||||||||||
2015 | 5,120 | 3.6 | 5.4 | % | 153,375 | 5.7 | 29.96 | 2 | |||||||||||||
2016 | 7,007 | 5.0 | 10.4 | % | 183,608 | 6.8 | 26.20 | 4 | |||||||||||||
2017 | 10,163 | 7.2 | 17.6 | % | 329,677 | 12.3 | 32.44 | 6 | |||||||||||||
2018 | 3,000 | 2.1 | 19.8 | % | 90,420 | 3.4 | 30.14 | 2 | |||||||||||||
2019 | 72,780 | 51.7 | 71.5 | % | 1,048,251 | 39.0 | 14.40 | 8 | |||||||||||||
2020 | 16,501 | 11.7 | 83.2 | % | 450,589 | 16.7 | 27.31 | 4 | |||||||||||||
2021 | 3,450 | 2.5 | 85.7 | % | 86,112 | 3.2 | 24.96 | 1 | |||||||||||||
2022 | 4,478 | 3.2 | 88.9 | % | 150,998 | 5.6 | 33.72 | 1 | |||||||||||||
2023 | 0 | 0.0 | 88.9 | % | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2024 | 0 | 0.0 | 88.9 | % | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2025 | 0 | 0.0 | 88.9 | % | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2026 & Thereafter | 2,913 | 2.1 | 90.9 | % | 124,500 | 4.6 | 42.74 | 1 | |||||||||||||
Vacant | 12,764 | 9.1 | 100.0 | % | 0 | 0.0 | 0.00 | 0 | |||||||||||||
Total / Wtd. Avg. | 140,676 | 100.0 | % | $2,690,565 | 100.0 | % | $21.03 | 30 |
(1) | Calculated based on the approximate square footage occupied by each Owned Tenant. |
The following table presents certain information relating to historical leasing at the Mesa Town Center Property:
Historical Leased %(1)
| 2012 | 2013 | 2014 | |||
Owned Space | 93.0% | 93.0% | 94.5% |
(1) | As provided by the borrower and which reflects average monthly occupancy for the indicated year. |
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n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Mesa Town Center Property: |
Cash Flow Analysis(1)
2012 | 2013 | 2014 | Underwritten | Underwritten $ per SF | |||||||||||
Base Rent(2) | $2,498,765 | $2,474,643 | $2,615,520 | $2,690,565 | $19.13 | ||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 365,177 | 2.60 | ||||||||||
Total Rent | $2,498,765 | $2,474,643 | $2,615,520 | $3,055,742 | $21.72 | ||||||||||
Total Reimbursables | 775,583 | 796,983 | 746,019 | 738,175 | 5.25 | ||||||||||
Other Income | 36,358 | 51,642 | 31,715 | 29,353 | 0.21 | ||||||||||
Vacancy & Credit Loss | 0 | 0 | 0 | (365,177 | ) | (2.60 | ) | ||||||||
Effective Gross Income | $3,310,707 | $3,323,268 | $3,393,254 | $3,458,093 | $24.58 | ||||||||||
Total Operating Expenses | $869,382 | $837,968 | $810,175 | $865,068 | $6.15 | ||||||||||
Net Operating Income | $2,441,325 | $2,485,300 | $2,583,080 | $2,593,025 | $18.43 | ||||||||||
TI/LC | 0 | 0 | 0 | 100,241 | 0.71 | ||||||||||
Capital Expenditures | 0 | 0 | 0 | 39,951 | 0.28 | ||||||||||
Net Cash Flow | $2,441,325 | $2,485,300 | $2,583,080 | $2,452,832 | $17.44 |
(1) | Certain items such as straight line rent, interest expense, interest income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. |
(2) | Underwritten base rent is based on contractual rents as of March 19, 2015 and rent steps through June 30, 2016. |
n | Appraisal. According to the appraisal, the Mesa Town Center Property had an “as-is” appraised value of $48,000,000 as of March 16, 2015. |
n | Environmental Matters. According to a Phase I environmental report, dated March 30, 2015, there are no recognized environmental conditions or recommendations for further action at the Mesa Town Center Property, other than recommendations for (i) the tenants Rite Aid, Sherwin Williams, Center Veterinary Clinic and Transdental Family Care to contact the San Diego County Department of Environmental Health in order to close certain open violations listed with the San Diego Hazardous Materials Management Division, (ii) the installation of secondary containment structures beneath certain metal containers and drums at the space operated as a dry cleaner facility, with an estimated cost of $900, and (iii) an asbestos operations and maintenance (O&M) plan. |
n | Market Overview and Competition. The Mesa Town Center Property is located in the Miramar / Mira Mesa / South Ranch retail submarket of San Diego, California. As of 2014, the population within a five-mile radius of the Mesa Town Center Property was 198,478 with an average household income of $124,917. According to a third quarter 2014 market research report, the Miramar / Mira Mesa / South Ranch retail submarket contains approximately 4.3 million SF of retail space with a reported vacancy rate of 5.3%. |
The following table presents certain information relating to the primary competition for the Mesa Town Center Property:
Competitive Set(1)
| Mesa Town Center | Mira Mesa | Mira Mesa | Mira Mesa Mall | Mira Mesa | Mira Mesa | SR Ranch | |||||||
Distance from Subject | - | 0.4 miles | 0.5 miles | 0.8 miles | 0.8 miles | 0.4 miles | 2.3 miles | |||||||
Property Type | Retail | Retail | Retail | Retail | Retail | Retail | Retail | |||||||
Year Built | 1972-1975 | 1973 | 1991 | 1974 | 1987 | 2000 | 1981 | |||||||
Total GLA | 140,676 | 112,911 | 136,973 | 134,803 | 250,820 | 238,747 | 70,576 | |||||||
Total Occupancy | 90.9% | 100% | 98% | 92% | 99% | 99% | 98% | |||||||
Major Tenants | Albertsons (Seafood City), Rite Aid, JP Morgan Chase | Lucky Seafood | H Mart | Vons, CVS Pharmacy, Petco | Target, Babies R’ Us, Vinh Hung Supermarket | Albertsons, CVS Pharmacy, Home Depot | Trader Joe’s |
(1) | Source: Appraisal. |
B-123 |
MESA TOWN CENTER |
n | The Borrower. The borrower is Mesa Town Center, LLC, a single-purpose, single-asset entity. William Simmons, an indirect owner of the borrower, is the non-recourse carveout guarantor under the Mesa Town Center Loan. William Simmons has owned and operated shopping centers in the San Diego area since 1990. |
n | Escrows. On the origination date, the borrower funded (i) a tax reserve of approximately $114,021, (ii) a deferred maintenance reserve of $41,195 related to, among other things, pavement and parking, HVAC and electrical repairs, repairs resulting from roof leaks and (iii) $990 for the installation of secondary containment structures as described under “—Environmental Matters” above. |
On each due date, the borrower will be required to fund (i) a tax and insurance reserve in an amount equal to one-twelfth of the amount that the lender reasonably estimates will be necessary to pay taxes and insurance premiums over the then succeeding 12-month period; provided, however, that reserve deposits for insurance premiums are not required if the borrower is maintaining a blanket or umbrella policy in accordance with the Mesa Town Center Loan documents and there is no continuing event of default, and (ii) a capital expenditure reserve in the amount of $3,400.
In addition, on each due date during the continuance of a Mesa Town Center Trigger Period, the Mesa Town Center Loan documents require an excess cash reserve as described under “—Lockbox and Cash Management” below.
A “Mesa Town Center Trigger Period” means (i) a period commencing as of the conclusion of any 12-month period (ending on the last day of any fiscal quarter) during which the net operating income (as calculated under the Mesa Town Center Loan documents) is less than $1,904,365.50, and ending at the conclusion of the second consecutive fiscal quarter during which the net operating income for the trailing 12-month period (ending on the last day of any fiscal quarter) is equal to or greater than $1,904,365.50, (ii) a period commencing upon the borrower’s failure to deliver monthly, quarterly or annual financial reports and ending when such reports are delivered and they indicate that no other Mesa Town Center Trigger Period is ongoing, and (iii) with respect to the Rite Aid or Albertsons tenants, a period (a) commencing at any time such tenant “goes dark” for any reason and ending when such tenant resumes full operations in its entire space, (b) commencing at any time such tenant becomes a debtor under a bankruptcy or any other creditors rights laws and ending when such tenant has emerged from bankruptcy and the lease has been affirmed, (c) commencing at any time such tenant fails to renew its lease at the beginning of its renewal notice period under its lease and ending when such tenant renews its lease; and (d) commencing at any time such tenant vacates its space, permanently closes its store, gives notice of its intent to terminate its lease or the lease otherwise terminates for any reason and ending when such space is re-leased and the replacement tenant is in occupancy, open for business and paying rent.
n | Lockbox and Cash Management. The Mesa Town Center Loan is structured with a springing lockbox and springing cash management. Upon the occurrence of a Mesa Town Center Trigger Period or event of default under the Mesa Town Center Loan, the Mesa Town Center Loan documents permit the lender to deliver notices to each tenant instructing them to remit all rents into a lender-controlled lockbox account and require that all cash revenues relating to the Mesa Town Center Property and all other money received by the borrower or the property manager with respect to the Mesa Town Center Property (other than tenant security deposits) be deposited into such lockbox account within one business day following receipt. On each business day during the continuance of a Mesa Town Center Trigger Period or an event of default under the Mesa Town Center Loan, all amounts in the lockbox account are required to be remitted to a lender-controlled cash management account. On each business day that no Mesa Town Center Trigger Period or event of default under the Mesa Town Center Loan is continuing, all funds in the cash management accountin excess of the amounts required to pay monthly reserves and debt service on the next due date are required to be swept into a borrower-controlled operating account. |
B-124 |
MESA TOWN CENTER |
On each due date during the continuance of a Mesa Town Center Trigger Period or, at the lender’s discretion, during an event of default under the Mesa Town Center Loan, the Mesa Town Center Loan documents require that all amounts on deposit in the cash management account be used to pay debt service, required reserves and budgeted operating expenses, and that all remaining amounts be reserved in an excess cash flow reserve account. During the continuance of an event of default under the Mesa Town Center Loan, the lender may apply all funds on deposit in any of the accounts constituting collateral for the Mesa Town Center Loan to amounts payable under the Mesa Town Center Loan documents and/or toward the payment of expenses of the Mesa Town Center Property, in such order of priority as the lender may determine.
n | Property Management. The Mesa Town Center Property is managed by NMC South, LLC pursuant to a management agreement. Under the Mesa Town Center Loan documents, the Mesa Town Center Property is required to remain managed by NMC South, LLC or any other management company approved by the lender and with respect to which a Rating Agency Confirmation has been received. The lender has the right to replace, or require the borrower to replace, the property manager with a property manager selected by the lender (i) during the continuance of an event of default under the Mesa Town Center Loan, (ii) following any foreclosure, conveyance in lieu of foreclosure or other similar transaction, (iii) during the continuance of a material default by the property manager under the management agreement (after the expiration of any applicable notice and/or cure periods), (iv) if the property manager files for or is the subject of a petition in bankruptcy or (v) if a trustee or receiver is appointed for the property manager’s assets or the property manager makes an assignment for the benefit of its creditors or is adjudicated insolvent. |
n | Mezzanine or Secured Subordinate Indebtedness.Not permitted. |
n | Terrorism Insurance. So long as TRIPRA or a similar or subsequent statute is in effect, the borrower is required to maintain terrorism insurance for foreign and domestic acts (as those terms are defined in TRIPRA or a similar or subsequent statute) in an amount equal to the full replacement cost of the Mesa Town Center Property (plus 18 months of rental loss and/or business interruption coverage plus an additional period of indemnity covering the 12 months following restoration). If TRIPRA or a similar or subsequent statute is not in effect, then provided that terrorism insurance is commercially available, the borrower will be required to carry terrorism insurance throughout the term of the Mesa Town Center Loan as described in the preceding sentence, but in that event the borrower will not be required to spend more than two times the amount of the insurance premium that is payable at that time in respect of the property and business interruption/rental loss insurance required under the related loan documents (without giving effect to the cost of terrorism and earthquake components of such property and business interruption/rental loss insurance), and if the cost of terrorism insurance exceeds such amount, then the borrower will be required to purchase the maximum amount of terrorism insurance available with funds equal to such amount. In either such case, terrorism insurance may not have a deductible in excess of $50,000. The required terrorism insurance may be included in a blanket policy, provided that the borrower provides evidence satisfactory to the lender that the insurance premiums for the Mesa Town Center Property are separately allocated to the Mesa Town Center Property and that the policy will provide the same protection as a separate policy. See “Risk Factors—Terrorism Insurance May Not Be Available for All Mortgaged Properties” in the Prospectus Supplement. |
B-125 |
NY SEVEN SELF STORAGE PORTFOLIO |
Mortgaged Property Information | Mortgage Loan Information | ||||
Number of Mortgaged Properties | 7 | Loan Seller | RMF | ||
Location (City/State) | Various, New York | Cut-off Date Principal Balance | $20,547,390 | ||
Property Type | Self Storage | Cut-off Date Principal Balance per SF | $87.41 | ||
Size (SF) | 235,069 | Percentage of Initial Pool Balance | 2.8% | ||
Total Occupancy as of 3/17/2015(1) | 90.9% | Number of Related Mortgage Loans(4) | 3 | ||
Owned Occupancy as of 3/17/2015(1) | 90.9% | Type of Security | Fee Simple | ||
Year Built / Latest Renovation | Various / NAP | Mortgage Rate | 4.4200% | ||
Appraised Value(2) | $30,500,000 | Original Term to Maturity (Months) | 120 | ||
Original Amortization Term (Months) | 360 | ||||
Original Interest Only Period (Months) | NAP | ||||
Borrower Sponsors(5) | Robert Moser and Robert Morgan | ||||
Underwritten Revenues | $2,718,303 | ||||
Underwritten Expenses | $923,023 | Escrows | |||
Underwritten Net Operating Income (NOI) | $1,795,280 | Upfront | Monthly | ||
Underwritten Net Cash Flow (NCF) | $1,760,020 | Taxes | $118,021 | $28,100 | |
Cut-off Date LTV Ratio(3) | 67.4% | Insurance | $43,186 | $5,141 | |
Maturity Date LTV Ratio(3) | 54.5% | Replacement Reserves | $0 | $2,938 | |
DSCR Based on Underwritten NOI / NCF | 1.45x / 1.42x | TI/LC | $0 | $0 | |
Debt Yield Based on Underwritten NOI / NCF | 8.7% / 8.6% | Other(6) | $10,250 | $0 |
Sources and Uses | |||||
Sources | $ | % | Uses | $ | % |
Loan Amount | $20,600,000 | 100.0% | Loan Payoff | $15,839,478 | 76.9% |
Principal Equity Distribution | 3,698,244 | 18.0 | |||
Closing Costs | 890,821 | 4.3 | |||
Reserves | 171,457 | 0.8 | |||
Total Sources | $20,600,000 | 100.0% | Total Uses | $20,600,000 | 100.0% |
(1) | As of March 17, 2015 for all properties except for Affordable Malta, which is as of March 26, 2015. |
(2) | The Appraised Value is the “as-is” bulk portfolio value. The combined “as-is” individual appraised value is $28,380,000. |
(3) | The Cut-off Date LTV Ratio and Maturity Date LTV Ratio are based on the “as-is” bulk portfolio value. The Cut-off Date LTV Ratio and Maturity Date LTV Ratio based on the combined “as-is” individual appraised value of $28,380,000 is 72.4% and 58.5%, respectively. |
(4) | The borrower sponsors are also borrower sponsors of the Cape May Portfolio Loan and On-Site Self Storage Loan. |
(5) | Robert Moser and Robert Morgan are the non-recourse carveout guarantors under the NY Seven Self Storage Portfolio Loan. |
(6) | Other upfront reserves represent an immediate repairs reserve for the Rotterdam Secured Property. |
The following table presents certain information relating to the NY Seven Self Storage Portfolio Properties:
Property Name |
| City |
| State |
| Cut-off Date Allocated |
| Total |
| Occupancy(1) |
| Year |
| UW NCF | |||||
Affordable Malta | Mechanicville | NY | $7,361,152 | 77,875 | 75.3% | 2011 / NAP | $617,352 | ||||||||||||
A Space Place | Medford | NY | 4,488,508 | 33,230 | 97.4% | 1989, 2001 / NAP | 398,331 | ||||||||||||
Dix Ave Mini Storage | Glens Falls | NY | 2,802,824 | 39,200 | 99.5% | 2002 / NAP | 247,955 | ||||||||||||
Snyders Best Rate | Cohoes | NY | 2,059,726 | 22,500 | 98.2% | 1997-2004 / NAP | 170,830 | ||||||||||||
Affordable Wilton | Wilton | NY | 1,964,969 | 29,100 | 100.0% | 2004, 2009 / NAP | 175,013 | ||||||||||||
Rotterdam Secured | Rotterdam | NY | 947,574 | 20,064 | 95.9% | 1980 / NAP | 78,865 | ||||||||||||
Affordable Saratoga | Wilton | NY | 922,638 | 13,100 | 100.0% | 1996, 2000 / NAP | 71,674 | ||||||||||||
Total / Wtd. Avg. | $20,547,390 | 235,069 | 90.9% | $1,760,020 | |||||||||||||||
(1) | Occupancy as of March 17, 2015 for all properties except Affordable Malta, which is as of March 26, 2015. |
B-126 |
NY SEVEN SELF STORAGE PORTFOLIO |
The following table presents certain information relating to historical leasing at the NY Seven Self Storage Portfolio Properties:
Historical Leased %(1)
|
| 2012 |
| 2013 |
| 2014 |
| As of |
Affordable Malta | 57.8% | 63.9% | 73.8% | 75.3% | ||||
A Space Place | 87.8% | 89.8% | 91.8% | 97.4% | ||||
Dix Ave Mini Storage | 93.6% | 96.9% | 98.8% | 99.5% | ||||
Snyders Best Rate | 87.9% | 92.7% | 95.5% | 98.2% | ||||
Affordable Wilton | 86.9% | 91.3% | 94.2% | 100.0% | ||||
Rotterdam Secured | 84.7% | 88.2% | 93.8% | 95.9% | ||||
Affordable Saratoga | 91.3% | 95.9% | 97.2% | 100.0% |
(1) | As provided by the borrower and which represents average occupancy for the specified year unless otherwise indicated. |
(2) | As of March 17, 2015 for all properties except Affordable Malta, which is as of March 26, 2015. |
■ | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the NY Seven Self Storage Portfolio Properties: |
Cash Flow Analysis(1)
2012 | 2013 | 2014 | TTM 3/31/2015 | Underwritten(2) | Underwritten $ per SF | ||||||||||||||
Base Rent | $2,518,643 | $2,566,325 | $2,610,335 | $2,640,915 | $2,634,852 | $11.21 | |||||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 0 | 414,300 | 1.76 | |||||||||||||
Goss Potential Rent | $2,518,643 | $2,566,325 | $2,610,335 | $2,640,915 | $3,049,152 | $12.97 | |||||||||||||
Vacancy, Credit Loss & Concessions | (318,503 | ) | (233,631 | ) | (146,743 | ) | (137,371 | ) | (592,527 | ) | (2.52 | ) | |||||||
Total Rent Revenue | $2,200,140 | $2,332,694 | $2,463,592 | $2,503,544 | $2,456,625 | $10.45 | |||||||||||||
Other Revenue(3) | 183,297 | 214,870 | 250,436 | 261,679 | 261,679 | 1.11 | |||||||||||||
Effective Gross Income | $2,383,437 | $2,547,564 | $2,714,028 | $2,765,223 | $2,718,303 | $11.56 | |||||||||||||
Total Operating Expenses | $711,853 | $758,668 | $785,228 | $765,109 | $923,023 | $3.93 | |||||||||||||
Net Operating Income | $1,671,584 | $1,788,896 | $1,928,800 | $2,000,114 | $1,795,280 | $7.64 | |||||||||||||
Replacement Reserves | 0 | 0 | 0 | 0 | 35,260 | 0.15 | |||||||||||||
Net Cash Flow | $1,671,584 | $1,788,896 | $1,928,800 | $2,000,114 | $1,760,020 | $7.49 |
(1) | Certain items such as straight line rent, interest expense, interest income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. |
(2) | Underwritten cash flow is based on the March 17, 2015 rent rolls for all properties except Affordable Malta, which is as of March 26, 2015. |
(3) | Other Revenue includes administrative fees, insurance fees, late fees, retail sales, truck rental, etc. |
B-127 |
OKLAHOMA WALMART PORTFOLIO |
Mortgaged Property Information | Mortgage Loan Information | |||||
Number of Mortgaged Properties | 2 | Loan Seller | CGMRC | |||
Location (City/State) | Various, Oklahoma | Cut-off Date Principal Balance | $15,093,360 | |||
Property Type | Retail | Cut-off Date Principal Balance per SF | $183.54 | |||
Size (SF) | 82,234 | Percentage of Initial Pool Balance | 2.1% | |||
Total Occupancy as of 3/25/2015 | 100.0% | Number of Related Mortgage Loans | None | |||
Owned Occupancy as of 3/25/2015 | 100.0% | Type of Security | Fee Simple | |||
Year Built / Latest Renovation | 2015 / NAP | Mortgage Rate | 4.4200% | |||
Appraised Value | $20,100,000 | Original Term to Maturity (Months) | 120 | |||
Original Amortization Term (Months) | 360 | |||||
Original Interest Only Period (Months) | 24 | |||||
Borrower Sponsor(1) | Kenneth Shimm | |||||
Underwritten Revenues | $1,273,370 | |||||
Underwritten Expenses | $199,510 | Escrows | ||||
Underwritten Net Operating Income (NOI) | $1,073,860 | Upfront | Monthly | |||
Underwritten Net Cash Flow (NCF) | $1,061,525 | Taxes | $0 | $0 | ||
Cut-off Date LTV Ratio | 75.1% | Insurance(2) | $0 | $0 | ||
Maturity Date LTV Ratio | 64.0% | Replacement Reserves | $0 | $0 | ||
DSCR Based on Underwritten NOI / NCF | 1.18x / 1.17x | TI/LC | $0 | $0 | ||
Debt Yield Based on Underwritten NOI / NCF | 7.1% / 7.0% | Other(3) | $40,600 | $0 |
Sources and Uses | |||||
Sources | $ | % | Uses | $ | % |
Loan Amount | $15,093,360 | 73.4% | Purchase Price | $20,124,482 | 97.9% |
Principal’s New Cash Contribution | 4,613,353 | 22.4 | Closing Costs | 396,809 | 1.9 |
Other Sources | 855,178 | 4.2 | Reserves | 40,600 | 0.2 |
Total Sources | $20,561,891 | 100.0% | Total Uses | $20,561,891 | 100.0% |
(1) | Kenneth Shimm is the non-recourse carveout guarantor under the Oklahoma Walmart Portfolio Loan. |
(2) | During the loan term, on each monthly due date from November through May, the borrower is required to make monthly deposits equal to one-sixth of the amount sufficient to renew flood insurance at the Oklahoma Walmart Portfolio Properties. |
(3) | Other upfront reserve consists of a $40,600 reserve representing the costs associated with the completion of certain work items relating to the Oklahoma Walmart Portfolio Properties. |
The following table presents certain information relating to the Oklahoma Walmart Portfolio Properties:
Property Name |
| City |
| State |
| Allocated Cut-off Date |
| Total |
| Occupancy(1) |
| Appraised Value |
| Year Built / |
| UW NCF |
Walmart – Lawton | Lawton | OK | $7,732,278 | 41,117 | 100.0% | $10,300,000 | 2015 / NAP | $544,065 | ||||||||
Walmart – Oklahoma City | Oklahoma City | OK |
| 7,361,082 |
| 41,117 |
| 100.0% |
| 9,800,000 | 2015 / NAP |
| 517,460 | |||
Total / Wtd. Avg. | $15,093,360 | 82,234 | 100.0% | $20,100,000 | $1,061,525 | |||||||||||
(1) | Occupancy as of March 25, 2015. |
The following table presents certain information relating to the major tenants at the Oklahoma Walmart Portfolio Properties:
Largest Tenants Based on Underwritten Base Rent
Tenant Name |
| Credit Rating |
| Tenant |
| % of GLA |
| UW Base Rent |
| % of Total |
| UW Base Rent |
| Lease Expiration |
| Renewal / |
Walmart – Lawton | AA / Aa2/ AA | 41,117 | 50.0% | $556,724 | 51.2% | $13.54 | 1/13/2035 | 4, 5-year options | ||||||||
Walmart – Oklahoma City | AA / Aa2/ AA |
| 41,117 |
| 50.0 |
| 529,998 |
| 48.8 |
| 12.89 | 1/27/2035 | 4, 5-year options | |||
Largest Tenants | 82,234 | 100.0% | $1,086,722 | 100.0% | $13.21 | |||||||||||
Vacant |
| 0 |
| 0.0 |
| 0 |
| 0.0 |
| 0.00 | ||||||
Total / Wtd. Avg. All Tenants | 82,234 | 100.0% | $1,086,722 | 100.0% | $13.21 |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
B-128 |
OKLAHOMA WALMART PORTFOLIO |
The following table presents the lease rollover schedule at the Oklahoma Walmart Portfolio Properties, based on initial lease expiration dates:
Lease Expiration Schedule(1)
Year Ending |
| Expiring Owned |
| % of Owned |
| Cumulative % of |
| UW |
| % of Total UW |
| UW Base Rent |
| # of Expiring | ||||||
MTM | 0 | 0.0 | % | 0.0% | $0 | 0.0 | % | $0.00 | 0 | |||||||||||
2015 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2016 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2017 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2018 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2019 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2020 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2021 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2022 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2023 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2024 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2025 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | |||||||||||||
2026 & Thereafter | 82,234 | 100.0 | 100.0% | 1,086,722 | 100.0 | 13.21 | 2 | |||||||||||||
Vacant |
| 0 |
|
| 0.0 | 100.0% |
|
| 0 |
|
| 0.0 |
|
| 0.00 |
|
| 0 | ||
Total / Wtd. Avg. | 82,234 | 100.0 | % | $1,086,722 | 100.0 | % | $13.21 | 2 |
(1) | Calculated based on approximate square footage occupied by each Owned Tenant. |
The following table presents certain information relating to historical leasing at the Oklahoma Walmart Portfolio Properties:
Historical Leased %(1)
|
| As of |
Owned Space | 100.0% |
(1) | As provided by the borrower. The Oklahoma Walmart Portfolio Properties were constructed in 2015. |
■ | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Oklahoma Walmart Portfolio Properties: |
Cash Flow Analysis(1)
|
| Underwritten |
| Underwritten | ||
Base Rent | $1,086,722 | $13.21 | ||||
Contractual Rent Steps | 0 | 0.00 | ||||
Gross Up Vacancy |
| 0 |
|
| 0.00 |
|
Total Rent | $1,086,722 | $13.21 | ||||
Total Reimbursables | 199,510 | 2.43 | ||||
Other Income | 0 | 0.00 | ||||
Vacancy & Credit Loss |
| (12,862 | ) |
| (0.16 | ) |
Effective Gross Income | $1,273,370 | $15.48 | ||||
Real Estate Taxes | $70,151 | $0.85 | ||||
Insurance | 25,770 | 0.31 | ||||
Management Fee | 25,467 | 0.31 | ||||
Other Operating Expenses |
| 78,122 |
|
| 0.95 |
|
Total Operating Expenses | $199,510 | $2.43 | ||||
Net Operating Income | $1,073,860 | $13.06 | ||||
TI/LC | 0 | 0.00 | ||||
Replacement Reserves |
| 12,336 |
|
| 0.15 |
|
Net Cash Flow | $1,061,525 | $12.91 |
(1) | Certain items such as straight line rent, interest expense, interest income, lease cancellation income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items are not considered for the underwritten cash flow. |
B-129 |
PROMENADES PLAZA |
Mortgaged Property Information | Mortgage Loan Information | ||||
Number of Mortgaged Properties | 1 | Loan Seller | RMF | ||
Location (City/State) | Port Charlotte, Florida | Cut-off Date Principal Balance | $14,600,000 | ||
Property Type | Retail | Cut-off Date Principal Balance per SF | $63.28 | ||
Size (SF) | 230,704 | Percentage of Initial Pool Balance | 2.0% | ||
Total Occupancy as of 4/1/2015 | 88.4% | Number of Related Mortgage Loans(1) | 2 | ||
Owned Occupancy as of 4/1/2015 | 88.4% | Type of Security | Fee Simple | ||
Year Built / Latest Renovation | 1978 / 2008 | Mortgage Rate | 4.5800% | ||
Appraised Value | $22,300,000 | Original Term to Maturity (Months) | 120 | ||
Original Amortization Term (Months) | 360 | ||||
Original Interest Only Period (Months) | 24 | ||||
Borrower Sponsor(2) | Jeff Morr | ||||
Underwritten Revenues | $2,298,447 | ||||
Underwritten Expenses | $746,122 | Escrows | |||
Underwritten Net Operating Income (NOI) | $1,552,324 | Upfront | Monthly | ||
Underwritten Net Cash Flow (NCF) | $1,379,578 | Taxes | $94,912 | $22,598 | |
Cut-off Date LTV Ratio | 65.5% | Insurance | $136,838 | $11,847 | |
Maturity Date LTV Ratio | 54.3% | Replacement Reserves | $0 | $2,884 | |
DSCR Based on Underwritten NOI / NCF | 1.73x / 1.54x | TI/LC(3) | $250,000 | $10,574 | |
Debt Yield Based on Underwritten NOI / NCF | 10.6% / 9.4% | Other(4) | $6,750 | $0 |
Sources and Uses | ||||||||||||
Sources | $ | % | Uses | $ | % | |||||||
Loan Amount | $14,600,000 | 64.6 | % | Purchase Price | $21,500,000 | 95.2 | % | |||||
Principal’s New Cash Contribution | 7,954,484 | 35.2 | Closing Costs | 605,984 | 2.7 | |||||||
Other Sources | 40,000 | 0.2 | Reserves | 488,500 | 2.2 | |||||||
Total Sources | $22,594,484 | 100.0 | % | Total Uses | $22,594,484 | 100.0 | % |
(1) | The borrower sponsor is also the borrower sponsor of the Highlands Plaza Loan. | ||
(2) | Jeff Morr is the non-recourse carveout guarantor under the Promenades Plaza Loan. | ||
(3) | TI/LC reserves are capped at $380,662. | ||
(4) | Other upfront reserves represent an immediate repairs reserve of $6,750. |
The following table presents certain information relating to the major tenants (which tenants, in certain cases, may have co-tenancy provisions) at the Promenades Plaza Property: |
Ten Largest Owned Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating (Fitch/MIS/S&P)(1) | Tenant GLA | % of GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | Lease Expiration | Tenant Sales $ per SF | Occupancy Cost | Renewal / Extension Options | |||||||||||||||
Winn-Dixie | NR/NR/NR | 55,107 | 23.9 | % | $452,066 | 23.4 | % | $8.20 | 12/31/2020 | $538 | 2.1% | 5, 5-year options | |||||||||||||
Fawcett Memorial Hospital | NR/NR/NR | 31,905 | 13.8 | 391,045 | 20.2 | 12.26 | 12/31/2019 | NA | NA | NA | |||||||||||||||
Charlotte County Sheriff’s Office | NR/NR/NR | 15,000 | 6.5 | 270,000 | 14.0 | 18.00 | 4/30/2016 | NA | NA | 2, 5-year options | |||||||||||||||
Bealls Outlet | NR/NR/NR | 41,290 | 17.9 | 215,121 | 11.1 | 5.21 | 4/30/2018 | $103 | 5.5% | 1, 5-year option | |||||||||||||||
YouFit Health Club | NR/NR/NR | 11,091 | 4.8 | 110,910 | 5.7 | 10.00 | 6/30/2021 | NA | NA | 2, 5-year options | |||||||||||||||
Tuesday Morning | NR/NR/NR | 18,000 | 7.8 | 82,500 | 4.3 | 4.58 | 7/31/2016 | $60 | 7.6% | 1, 5-year option | |||||||||||||||
Stephen Chiarello / Dermatologist | NR/NR/NR | 4,800 | 2.1 | 67,872 | 3.5 | 14.14 | 4/30/2018 | NA | NA | NA | |||||||||||||||
Hope Hospice and Community | NR/NR/NR | 6,413 | 2.8 | 52,435 | 2.7 | 8.18 | 12/31/2019 | NA | NA | NA | |||||||||||||||
DDP DMO of Florida | NR/NR/NR | 2,270 | 1.0 | 38,495 | 2.0 | 16.96 | 6/30/2019 | NA | NA | 2, 5-year options | |||||||||||||||
Medical Oxygen | NR/NR/NR | 2,040 | 0.9 | 34,578 | 1.8 | 16.95 | 3/31/2020 | NA | NA | 2, 5-year options | |||||||||||||||
Ten Largest Owned Tenants | 187,916 | 81.5 | % | $1,715,022 | 88.6 | % | $9.13 | ||||||||||||||||||
Remaining Owned Tenants | 16,006 | 6.9 | 220,438 | 11.4 | 13.77 | ||||||||||||||||||||
Vacant Spaces (Owned Space) | 26,782 | 11.6 | 0 | 0 | 0.00 | ||||||||||||||||||||
Total / Wtd. Avg. All Owned Tenants | 230,704 | 100.0 | % | $1,935,460 | 100.0 | % | $9.49 |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
B-130 |
PROMENADES PLAZA |
The following table presents certain information relating to the lease rollover schedule at the Promenades Plaza Property, based on initial lease expiration dates: |
Lease Expiration Schedule(1)
Year Ending December 31, | Expiring Owned GLA | % of Owned GLA | Cumulative % of Owned GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | # of Expiring Tenants | ||||||||||||||
MTM | 3,600 | 1.6 | % | 1.6% | $24,000 | 1.2 | % | $6.67 | 1 | ||||||||||||
2015 | 1,400 | 0.6 | 2.2% | 20,066 | 1.0 | 14.33 | 1 | ||||||||||||||
2016 | 35,100 | 15.2 | 17.4% | 387,958 | 20.0 | 11.05 | 4 | ||||||||||||||
2017 | 5,340 | 2.3 | 19.7% | 90,882 | 4.7 | 17.02 | 4 | ||||||||||||||
2018 | 48,090 | 20.8 | 40.5% | 310,993 | 16.1 | 6.47 | 3 | ||||||||||||||
2019 | 40,588 | 17.6 | 58.1% | 481,975 | 24.9 | 11.87 | 6 | ||||||||||||||
2020 | 58,713 | 25.4 | 83.6% | 508,676 | 26.3 | 8.66 | 4 | ||||||||||||||
2021 | 11,091 | 4.8 | 88.4% | 110,910 | 5.7 | 10.00 | 1 | ||||||||||||||
2022 | 0 | 0.0 | 88.4% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2023 | 0 | 0.0 | 88.4% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2024 | 0 | 0.0 | 88.4% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2025 | 0 | 0.0 | 88.4% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2026 & Thereafter | 0 | 0.0 | 88.4% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
Vacant | 26,782 | 11.6 | 100.0% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
Total / Wtd. Avg. | 230,704 | 100.0 | % | $1,935,460 | 100.0 | % | $9.49 | 24 |
(1) | Calculated based on approximate square footage occupied by each Owned Tenant. |
The following table presents certain information relating to historical leasing at the Promenades Plaza Property: |
Historical Leased %(1)
2012 | 2013 | 2014 | As of 4/1/2015 | |||||
Owned Space | 86.6% | 88.2% | 87.5% | 88.4% |
(1) | As provided by the borrower and which represents average occupancy for the specified year unless otherwise indicated. |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Promenades Plaza Property: |
Cash Flow Analysis(1)
2012 | 2013 | 2014 | TTM 2/28/2015 | Underwritten(2) | Underwritten $ per SF | ||||||||||||
Base Rent | $1,928,210 | $1,914,622 | $1,917,294 | $1,931,767 | $1,961,269 | $8.50 | |||||||||||
Contractual Rent Steps | 0 | 0 | 0 | 0 | 2,691 | 0.01 | |||||||||||
Mark to Market Adjustment(3) | 0 | 0 | 0 | 0 | (28,500 | ) | (0.12) | ||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 0 | 360,980 | 1.56 | |||||||||||
Total Rent | $1,928,210 | $1,914,622 | $1,917,294 | $1,931,767 | $2,296,440 | $9.95 | |||||||||||
Total Reimbursables | 285,304 | 338,728 | 325,688 | 327,188 | 405,125 | 1.76 | |||||||||||
Other Income | 0 | 0 | 0 | 0 | 0 | 0.00 | |||||||||||
Less Vacancy & Credit Loss | 0 | 0 | 0 | 0 | (403,119 | ) | (1.75) | ||||||||||
Effective Gross Income | $2,213,513 | $2,253,351 | $2,242,982 | $2,258,954 | $2,298,447 | $9.96 | |||||||||||
Total Operating Expenses | $747,828 | $720,720 | $684,309 | $689,517 | $746,122 | $3.23 | |||||||||||
Net Operating Income | $1,465,686 | $1,532,631 | $1,558,673 | $1,569,437 | $1,552,324 | $6.73 | |||||||||||
TI/LC | 0 | 0 | 0 | 0 | 138,140 | 0.60 | |||||||||||
Capital Expenditures | 0 | 0 | 0 | 0 | 34,606 | 0.15 | |||||||||||
Net Cash Flow | $1,465,686 | $1,532,631 | $1,558,673 | $1,569,437 | $1,379,578 | $5.98 |
(1) | Certain items such as straight line rent, interest expense, interest income, lease cancellation income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. | ||
(2) | Underwritten cash flow is based on contractual rents as of April 1, 2015 and rent steps through April 1, 2016. | ||
(3) | Mark to Market Adjustment has been taken as the appraiser’s market rent for GSA tenants of $18.00 per SF gross which is below in-place base rent for the County Sheriff’s Office of $19.90 per SF. |
B-131 |
HAGERSTOWN PLAZA |
Mortgaged Property Information | Mortgage Loan Information | ||||
Number of Mortgaged Properties | 1 | Loan Seller | GSMC | ||
Location (City/State) | Hagerstown, Maryland | Cut-off Date Principal Balance | $14,160,573 | ||
Property Type | Retail | Cut-off Date Principal Balance per SF | $188.61 | ||
Size (SF) | 75,080 | Percentage of Initial Pool Balance | 2.0% | ||
Total Occupancy as of 4/23/2015 | 100.0% | Number of Related Mortgage Loans | None | ||
Owned Occupancy as of 4/23/2015 | 100.0% | Type of Security | Fee Simple | ||
Year Built / Latest Renovation | 2005 / NAP | Mortgage Rate | 3.9970% | ||
Appraised Value | $19,700,000 | Original Term to Maturity (Months) | 120 | ||
Original Amortization Term (Months) | 360 | ||||
Original Interest Only Period (Months) | NAP | ||||
Borrower Sponsor(1) | Stephen Swartz and Roland Guyot | ||||
Underwritten Revenues | $1,681,405 | ||||
Underwritten Expenses | $448,867 | Escrows | |||
Underwritten Net Operating Income (NOI) | $1,232,538 | Upfront | Monthly | ||
Underwritten Net Cash Flow (NCF) | $1,207,580 | Taxes | $0 | $0 | |
Cut-off Date LTV Ratio | 71.9% | Insurance | $0 | $0 | |
Maturity Date LTV Ratio | 57.3% | Replacement Reserves | $0 | $0 | |
DSCR Based on Underwritten NOI / NCF | 1.52x / 1.48x | TI/LC | $0 | $0 | |
Debt Yield Based on Underwritten NOI / NCF | 8.7% / 8.5% | Other | $0 | $0 |
Sources and Uses | ||||||||||||
Sources | $ | % | Uses | $ | % | |||||||
Loan Amount | $14,200,000 | 100.0 | % | Loan Payoff | $11,421,703 | 80.4 | % | |||||
Principal Equity Distribution | 2,490,365 | 17.5 | ||||||||||
Closing Costs | 287,932 | 2.0 | ||||||||||
Total Sources | $14,200,000 | 100.0 | % | Total Uses | $14,200,000 | 100.0 | % |
(1) | Stephen Swartz and Roland Guyot are jointly and severally the guarantors of the non-recourse carveouts under the Hagerstown Plaza Loan. |
The following table presents certain information relating to the major tenants (of which, certain tenants may have co-tenancy provisions) at the Hagerstown Plaza Property: |
Owned Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating (Fitch/MIS/S&P)(1) | Tenant GLA | % of GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | Lease Expiration | Tenant Sales $ per SF(2) | Occupancy Cost | Renewal / Extension Options | |||||||||||||||
Martin’s Food Store (Ahold)(3) | BBB / Baa3 / BBB | 65,455 | 87.2 | % | $1,204,372 | 90.6 | % | $18.40 | 5/31/2035 | $532 | 4.5% | 6, 5-year options | |||||||||||||
V&M Wine & Spirits | NR / NR / NR | 4,000 | 5.3 | 50,000 | 3.8 | 12.50 | 2/28/2021 | NA | NA | 2, 5-year options | |||||||||||||||
Holiday Hair | NR / NR / NR | 1,600 | 2.1 | 28,000 | 2.1 | 17.50 | 5/30/2020 | NA | NA | 1, 5-year option | |||||||||||||||
Classy Nails | NR / NR / NR | 1,625 | 2.2 | 26,406 | 2.0 | 16.25 | 5/31/2018 | NA | NA | 1, 5-year option | |||||||||||||||
Martin’s Fueling Station (Ahold)(3) | BBB / Baa3 / BBB | 2,400 | 3.2 | 20,000 | 1.5 | 8.33 | 5/31/2035 | NA | NA | 6, 5-year options | |||||||||||||||
Owned Tenants | 75,080 | 100.0 | % | $1,328,778 | 100.0 | % | $17.70 | ||||||||||||||||||
Vacant Spaces (Owned Space) | 0 | 0.0 | 0 | 0.0 | 0.00 | ||||||||||||||||||||
Total / Wtd. Avg. All Owned Tenants | 75,080 | 100.0 | % | $1,328,778 | 100.0 | % | $17.70 |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. | ||
(2) | Martin’s Food Store sales are as of December 31, 2014 and exclude fuel sales. Martin’s Food Store is not required to report sales; numbers shown were provided by an owner of the tenant. | ||
(3) | Martin’s Food Store (Ahold) and Martin’s Fueling Station (Ahold) leases are guaranteed by their parent company, Koninklijke Ahold N.V. |
B-132 |
HAGERSTOWN PLAZA |
The following table presents certain information relating to the lease rollover schedule at the Hagerstown Plaza Property, based on initial lease expirations: |
Lease Expiration Schedule(1)
Year Ending December 31, | Expiring Owned GLA | % of Owned GLA | Cumulative % of Owned GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | # of Expiring Tenants | ||||||||||||||
MTM | 0 | 0.0 | % | 0.0% | $0 | 0.0 | % | $0.00 | 0 | ||||||||||||
2015 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2016 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2017 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2018 | 1,625 | 2.2 | 2.2% | 26,406 | 2.0 | 16.25 | 1 | ||||||||||||||
2019 | 0 | 0.0 | 2.2% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2020 | 1,600 | 2.1 | 4.3% | 28,000 | 2.1 | 17.50 | 1 | ||||||||||||||
2021 | 4,000 | 5.3 | 9.6% | 50,000 | 3.8 | 12.50 | 1 | ||||||||||||||
2022 | 0 | 0.0 | 9.6% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2023 | 0 | 0.0 | 9.6% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2024 | 0 | 0.0 | 9.6% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2025 | 0 | 0.0 | 9.6% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2026 & Thereafter | 67,855 | 90.4 | 100.0% | 1,224,372 | 92.1 | 18.04 | 2 | ||||||||||||||
Vacant | 0 | 0.0 | 100.0% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
Total / Wtd. Avg. | 75,080 | 100.0 | % | $1,328,778 | 100.0 | % | $17.70 | 5 |
(1) | Calculated based on approximate square footage occupied by each Owned Tenant. |
The following table presents certain information relating to historical leasing at the Hagerstown Plaza Property: |
Historical Leased %(1)
2012 | 2013 | 2014 | ||||
Owned Space | 100% | 100% | 100% |
(1) | As provided by the borrower and which represents occupancy as of December 31, for the indicated year. |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Hagerstown Plaza Property: |
Cash Flow Analysis(1)
2012 | 2013 | 2014 | TTM 3/31/2015 | Underwritten(2) | Underwritten $ per SF | |||||||||||||
Base Rent | $1,375,389 | $1,385,427 | $1,393,760 | $1,393,760 | $1,328,778 | $17.70 | ||||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 0 | 0 | 0.00 | ||||||||||||
Total Rent | $1,375,389 | $1,385,427 | $1,393,760 | $1,393,760 | $1,328,778 | $17.70 | ||||||||||||
Total Reimbursables | 391,039 | 384,502 | 389,739 | 389,894 | 385,295 | 5.13 | ||||||||||||
Other Income | 0 | 0 | 0 | 0 | 0 | 0.00 | ||||||||||||
Vacancy & Credit Loss | 0 | 0 | 0 | 0 | (32,668 | ) | (0.44 | ) | ||||||||||
Effective Gross Income | $1,766,428 | $1,769,929 | $1,783,499 | $1,783,654 | $1,681,405 | $22.39 | ||||||||||||
Total Operating Expenses | $437,966 | $435,272 | $458,529 | $459,294 | $448,867 | $5.98 | ||||||||||||
Net Operating Income | $1,328,462 | $1,334,657 | $1,324,970 | $1,324,360 | $1,232,538 | $16.42 | ||||||||||||
TI/LC | 0 | 0 | 0 | 0 | 13,696 | 0.18 | ||||||||||||
Capital Expenditures | 0 | 0 | 0 | 0 | 11,262 | 0.15 | ||||||||||||
Net Cash Flow | $1,328,462 | $1,334,657 | $1,324,970 | $1,324,360 | $1,207,580 | $16.08 |
(1) | Certain items such as straight line rent, interest expense, interest income, lease cancellation income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. | ||
(2) | Underwritten cash flow based on the April 23, 2015 rent roll with rent steps through June 30, 2016. |
B-133 |
BEST STORAGE PORTFOLIO |
Mortgaged Property Information | Mortgage Loan Information | |||||
Number of Mortgaged Properties | 2 | Loan Seller | CGMRC | |||
Location (City/State) | Anchorage, Alaska | Cut-off Date Principal Balance | $12,464,974 | |||
Property Type | Self Storage | Cut-off Date Principal Balance per SF | $107.02 | |||
Size (SF) | 116,471 | Percentage of Initial Pool Balance | 1.7% | |||
Total Occupancy as of 3/18/2015 | 92.3% | Number of Related Mortgage Loans | None | |||
Owned Occupancy as of 3/18/2015 | 92.3% | Type of Security | Fee Simple | |||
Year Built / Latest Renovation | Various / NAP | Mortgage Rate | 3.9500% | |||
Appraised Value | $22,570,000 | Original Term to Maturity (Months) | 120 | |||
Original Amortization Term (Months) | 360 | |||||
Original Interest Only Period (Months) | NAP | |||||
Borrower Sponsor(1) | Arthur Lloyd Davidson, Jr., Tudor Holding SPE, Inc. and West Holding SPE, Inc. | |||||
Underwritten Revenues | $2,090,476 | |||||
Underwritten Expenses | $721,229 | Escrows | ||||
Underwritten Net Operating Income (NOI) | $1,369,247 | Upfront | Monthly | |||
Underwritten Net Cash Flow (NCF) | $1,338,760 | Taxes | $125,743 | $12,574 | ||
Cut-off Date LTV Ratio | 55.2% | Insurance | $18,630 | $2,329 | ||
Maturity Date LTV Ratio | 43.9% | Replacement Reserves | $0 | $2,541 | ||
DSCR Based on Underwritten NOI / NCF | 1.92x / 1.88x | TI/LC | $0 | $0 | ||
Debt Yield Based on Underwritten NOI / NCF | 11.0% / 10.7% | Other(2) | $65,088 | $0 |
Sources and Uses | |||||
Sources | $ | % | Uses | $ | % |
Loan Amount | $12,500,000 | 99.6% | Loan Payoff | $9,513,271 | 75.8% |
Other Sources | 45,000 | 0.4 | Principal Equity Distribution | 2,570,742 | 20.5 |
Closing Costs | 251,526 | 2.0 | |||
Reserves | 209,460 | 1.7 | |||
Total Sources | $12,545,000 | 100.0% | Total Uses | $12,545,000 | 100.0% |
(1) | Arthur Lloyd Davidson, Jr. is the non-recourse carveout guarantor under the Best Storage Portfolio Loan. | |
(2) | Other Upfront reserve represents $65,088 for deferred maintenance. |
The following table presents certain information relating to the Best Storage Portfolio Properties:
Property Name | City | State | Allocated Cut-off Date Loan Amount | Total GLA | Occupancy(1) | Appraised Value | Year Built / Renovated | UW NCF | ||||||||
Best Storage-Tudor Road | Anchorage | AK | $9,830,595 | 79,918 | 93.9% | $17,800,000 | 1998, 2007 / NAP | $1,026,488 | ||||||||
Best Storage-Woodland Drive | Anchorage | AK | 2,634,379 | 36,553 | 88.9% | 4,770,000 | 1977 / NAP | 312,272 | ||||||||
Total / Wtd. Avg. | $12,464,974 | 116,471 | 92.3% | $22,570,000 | $1,338,760 |
(1) | Occupancy as of March 18, 2015. |
The following table presents certain information relating to historical leasing at the Best Storage Portfolio Properties:
Historical Leased %(1)
2012 | 2013 | 2014 | TTM 2/28/2015 | |||||
Owned Space | 94.3% | 89.0% | 89.3% | 89.4% |
(1) | As provided by the borrower and which reflects average occupancy for the specified year unless otherwise indicated. |
B-134 |
BEST STORAGE PORTFOLIO |
■ | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Best Storage Portfolio Properties: |
Cash Flow Analysis(1)
2012 | 2013 | 2014 | TTM 2/28/2015 | Underwritten(2) | Underwritten $ per Unit | |||||||
Base Rent | $2,070,334 | $2,013,218 | $2,025,490 | $2,040,165 | $2,105,904 | $18.08 | ||||||
Gross Up Vacancy | 0 | 0 | 0 | 0 | 197,100 | 1.69 | ||||||
Gross Potential Rent | $2,070,334 | $2,013,218 | $2,025,490 | $2,040,165 | $2,303,004 | $19.77 | ||||||
Vacancy, Credit Loss & Concessions | 0 | 0 | 0 | 0 | (281,668) | (2.42) | ||||||
Total Rent | $2,070,334 | $2,013,218 | $2,025,490 | $2,040,165 | $2,021,336 | $17.35 | ||||||
Other Income(3) | 56,947 | 61,050 | 63,791 | 69,140 | 69,140 | 0.59 | ||||||
Effective Gross Income | $2,127,281 | $2,074,268 | $2,089,281 | $2,109,305 | $2,090,476 | $17.95 | ||||||
Real Estate Taxes | $148,408 | $152,495 | $144,313 | $144,313 | $149,782 | $1.29 | ||||||
Insurance | 24,177 | 26,106 | 26,804 | 26,804 | 26,614 | 0.23 | ||||||
Management Fee | 90,203 | 88,161 | 91,001 | 91,690 | 83,619 | 0.72 | ||||||
Other Expenses | 427,235 | 437,870 | 441,096 | 440,670 | 461,213 | 3.96 | ||||||
Total Operating Expenses | $690,023 | $704,632 | $703,213 | $703,477 | $721,229 | $6.19 | ||||||
Net Operating Income | $1,437,258 | $1,369,636 | $1,386,068 | $1,405,828 | $1,369,247 | $11.76 | ||||||
Replacement Reserves | 0 | 0 | 0 | 0 | 30,487 | 0.26 | ||||||
Net Cash Flow | $1,437,258 | $1,369,636 | $1,386,068 | $1,405,828 | $1,338,760 | $11.49 |
(1) | Certain items such as straight line rent, interest expense, interest income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flows. | |
(2) | Underwritten cash flow is based on the March 18, 2015 rent roll. | |
(3) | Other Income consists of late fees, merchandise sales, auction revenue, and other service fees. |
B-135 |
CROWNE PLAZA BLOOMINGTON |
Mortgaged Property Information | Mortgage Loan Information | |||||
Number of Mortgaged Properties | 1 | Loan Seller | CGMRC | |||
Location (City/State) | Bloomington, Minnesota | Cut-off Date Principal Balance(4) | $12,170,872 | |||
Property Type | Hospitality | Cut-off Date Principal Balance per Room(1) | $60,652.19 | |||
Size (Rooms) | 430 | Percentage of Initial Pool Balance | 1.7% | |||
Total TTM Occupancy as of 10/31/2014 | 79.1% | Number of Related Mortgage Loans | None | |||
Owned TTM Occupancy as of 10/31/2014 | 79.1% | Type of Security(5) | Fee Simple | |||
Year Built / Latest Renovation | 1981, 1986 / 2011 | Mortgage Rate | 4.6500% | |||
Appraised Value | $31,900,000 | Original Term to Maturity (Months) | 120 | |||
Original Amortization Term (Months) | 360 | |||||
Original Interest Only Period (Months) | NAP | |||||
Borrower Sponsors(6) | Myron Kaeding, Dr. Ambrish Gupta, Dr. Vimla Bhooshan and Dr. Yudh Gupta | |||||
Underwritten Revenues | $15,232,762 | |||||
Underwritten Expenses | $11,831,997 | |||||
Underwritten Net Operating Income (NOI) | $3,400,765 | Escrows | ||||
Underwritten Net Cash Flow (NCF) | $2,791,455 | Upfront | Monthly | |||
Cut-off Date LTV Ratio(1)(2) | 73.3% | Taxes | $355,285 | $71,057 | ||
Maturity Date LTV Ratio(1)(3) | 55.1% | Insurance | $0 | $14,260 | ||
DSCR Based on Underwritten NOI / NCF(1) | 2.09x / 1.72x | FF&E | $0 | $0 | ||
Debt Yield Based on Underwritten NOI / NCF(1) | 13.0% / 10.7% | Other(7) | $4,678,193 | $0 |
Sources and Uses
Sources | $ | % | Uses | $ | % | |
Loan Amount(8) | $26,250,000 | 72.4% | Purchase Price | $30,000,000 | 82.7% | |
Principal’s New Cash Contribution | 9,915,247 | 27.3 | Reserves | 5,033,478 | 13.9 | |
Other Sources | 98,293 | 0.3 | Closing Costs | 1,230,062 | 3.4 | |
Total Sources | $36,263,540 | 100.0% | Total Uses | $36,263,540 | 100.0% |
(1) | Calculated based on the aggregate balance of the Crowne Plaza Bloomington Loan Combination. | |
(2) | The Cut-off Date LTV Ratio is calculated using the appraisal’s “as-is” appraised value of $31,900,000 plus the amount of PIP required under the franchise agreement ($3,689,846). The Cut-off Date LTV Ratio using solely the “as-is” appraised value is 81.8%. | |
(3) | The Maturity Date LTV Ratio is calculated utilizing the “as stabilized” appraised value of $38,700,000. The Maturity Date LTV Ratio, calculated on the basis of the “as-is” appraised value of $31,900,000, is 66.9%. | |
(4) | The Cut-off Date Principal Balance of $12,170,872 represents the non-controlling note A-2 of a $26,080,440 loan combination evidenced by twopari passu notes. The companion loan is evidenced by the controlling note A-1 with a principal balance of $13,909,568 as of the Cut-off Date, which was contributed to the CGCMT 2015-GC29 securitization transaction. | |
(5) | The Crowne Plaza Bloomington Property includes the borrower’s leasehold estate in a parking lease for 300 parking spaces with the owner of a parking deck adjacent to the hotel. | |
(6) | Myron Kaeding, Dr. Ambrish Gupta, Dr. Vimla Bhooshan and Dr. Yudh Gupta are the non-recourse carveout guarantors under the Crowne Plaza Bloomington Loan Combination. | |
(7) | Other reserves represents an upfront PIP reserve of $4,612,308, an upfront parking rent reserve of $42,135 and an upfront deferred maintenance reserve of $23,750. | |
(8) | Represents the aggregate principal balance of the Crowne Plaza Bloomington Mortgage Loan and the related companion loan. |
The following table presents certain information relating to the TTM October 2014 penetration rates relating to the Crowne Plaza Bloomington Property:
TTM October 2014 Penetration Rates(1)
Property | Occupancy | ADR | RevPAR | |||
Crowne Plaza Bloomington | 108.3% | 78.4% | 84.9% |
(1) | Source: October 2014 travel research report. |
The following table presents certain information relating to historical occupancy, ADR and RevPAR at the Crowne Plaza Bloomington Property:
Crowne Plaza Bloomington(1)
2012 | 2013 | TTM 10/31/2014(2) | ||||
Occupancy(3) | 77.3% | 82.2% | 79.1% | |||
ADR | $85.19 | $83.39 | $93.22 | |||
RevPAR | $65.88 | $68.58 | $73.75 |
(1) | Source: October 2014 travel research report. | |
(2) | As provided by the borrower. | |
(3) | Reflects average occupancy for the indicated period. |
B-136 |
CROWNE PLAZA BLOOMINGTON |
■ | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow, on an aggregate basis and per room, at the Crowne Plaza Bloomington Property: |
Cash Flow Analysis(1)
2011 | 2012 | 2013 | TTM 10/31/2014 | Underwritten | Underwritten $ per Room | |||||||
Room Revenue | $9,610,065 | $10,018,885 | $10,421,231 | $11,574,400 | $11,526,073 | $26,805 | ||||||
Food & Beverage Revenue | 3,692,724 | 3,532,864 | 3,482,711 | 3,347,850 | 3,305,078 | 7,686 | ||||||
Other Revenue(2) | 469,424 | 429,283 | 402,994 | 401,732 | 401,612 | 934 | ||||||
Total Revenue | $13,772,213 | $13,981,032 | $14,306,936 | $15,323,982 | $15,232,762 | $35,425 | ||||||
Room Expense | $2,999,175 | $3,208,868 | $3,590,563 | $3,598,596 | $3,532,135 | $8,214 | ||||||
Food & Beverage Expense | 2,650,570 | 2,508,536 | 2,467,862 | 2,408,494 | 2,388,800 | 5,555 | ||||||
Other Expense | 121,775 | 122,903 | 131,240 | 121,044 | 132,890 | 309 | ||||||
Total Departmental Expense | $5,771,520 | $5,840,307 | $6,189,665 | $6,128,134 | $6,053,825 | $14,079 | ||||||
Total Undistributed Expense | 3,950,093 | 3,872,993 | 4,275,056 | 4,542,284 | 4,585,263 | 10,663 | ||||||
Total Fixed Charges(3) | 947,987 | 1,081,063 | 1,184,503 | 1,206,005 | 1,192,909 | 2,774 | ||||||
Total Operating Expenses | $10,669,600 | $10,794,363 | $11,649,225 | $11,876,423 | $11,831,997 | $27,516 | ||||||
Net Operating Income | $3,102,613 | $3,186,669 | $2,657,711 | $3,447,559 | $3,400,765 | $7,909 | ||||||
FF&E | 550,889 | 559,241 | 572,277 | 612,959 | 609,310 | 1,417 | ||||||
Net Cash Flow | $2,551,724 | $2,627,428 | $2,085,434 | $2,834,600 | $2,791,455 | $6,492 |
(1) | Certain items such as straight line rent, interest expense, interest income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. | |
(2) | Other Revenue consists of equipment rentals, guaranteed no-show, a rooftop antenna lease, a sundry shop, internet fees and income from other miscellaneous sources. | |
(3) | Total Fixed Charges include parking rent for the borrower’s leasehold estate in a parking deck lease with the owner of a parking deck adjacent to the hotel. |
B-137 |
MAGNOLIA HOTEL OMAHA |
Mortgaged Property Information | Mortgage Loan Information | ||||
Number of Mortgaged Properties | 1 | Loan Seller | CGMRC | ||
Location (City/State) | Omaha, Nebraska | Cut-off Date Principal Balance | $11,200,000 | ||
Property Type | Hospitality | Cut-off Date Principal Balance per Room | $77,241.38 | ||
Size (Rooms) | 145 | Percentage of Initial Pool Balance | 1.5% | ||
Total TTM Occupancy as of 3/31/2015 | 69.8% | Number of Related Mortgage Loans | None | ||
Owned TTM Occupancy as of 3/31/2015 | 69.8% | Type of Security | Fee Simple | ||
Year Built / Latest Renovation | 1923 / 2007 | Mortgage Rate | 4.4100% | ||
Appraised Value | $16,600,000 | Original Term to Maturity (Months) | 120 | ||
Original Amortization Term (Months) | 360 | ||||
Original Interest Only Period (Months) | 12 | ||||
Underwritten Revenues | $6,126,041 | Borrower Sponsor(1) | H. Stevens Holtze III | ||
Underwritten Expenses | $4,733,249 | ||||
Underwritten Net Operating Income (NOI) | $1,392,792 | Escrows | |||
Underwritten Net Cash Flow (NCF) | $1,147,750 | Upfront | Monthly | ||
Cut-off Date LTV Ratio | 67.5% | Taxes | $0 | $14,549 | |
Maturity Date LTV Ratio | 50.2% | Insurance | $59,882 | $4,990 | |
DSCR Based on Underwritten NOI / NCF | 2.07x / 1.70x | FF&E(2) | $0 | $20,420 | |
Debt Yield Based on Underwritten NOI / NCF | 12.4% / 10.2% | Other(3) | $10,350 | $0 |
Sources and Uses | |||||||
Sources | $ | % | Uses | $ | % | ||
Loan Amount | $11,200,000 | 99.6 | % | Loan Payoff | $9,450,760 | 84.1 | % |
Other Sources | 40,000 | 0.4 | Principal Equity Distribution | 1,234,309 | 11.0 | ||
Closing Costs | 484,699 | 4.3 | |||||
Reserves | 70,232 | 0.6 | |||||
Total Sources | $11,240,000 | 100.0 | % | Total Uses | $11,240,000 | 100.0 | % |
(1) | H. Stevens Holtze III is the non-recourse carveout guarantor under the Magnolia Hotel Omaha Loan. |
(2) | On each monthly payment date, the borrower is required to make deposits equal to one-twelfth of 4% of the greater of (x) annual gross revenues for hotel related operations at the Magnolia Hotel Omaha Property for the preceding calendar year and (y) projected annual gross revenue for hotel related operations at the Magnolia Hotel Omaha Property as set forth in the approved annual budget. |
(3) | Other upfront reserve represents a deferred maintenance reserve of $10,350. |
The following table presents certain information relating to the TTM February 2015 penetration rates relating to the Magnolia Hotel Omaha Property:
TTM February 2015 Penetration Rates(1)
Property | Occupancy | ADR | RevPAR | |||
Magnolia Hotel Omaha | 108.5% | 97.9% | 106.2% |
(1) | Source: February 2015 travel research report. |
The following table presents certain information relating to historical occupancy, ADR and RevPAR at the Magnolia Hotel Omaha Property:
Magnolia Hotel Omaha(1)
2013 | 2014 | TTM 2/28/2015 | ||||
Occupancy | 65.6% | 68.6% | 69.0% | |||
ADR | $121.32 | $119.33 | $119.84 | |||
RevPAR | $79.65 | $81.85 | $82.67 |
(1) | Source: February 2015 travel research report and reflects average Occupancy, ADR, and RevPAR for the indicated period. |
B-138 |
MAGNOLIA HOTEL OMAHA |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow, on an aggregate basis and per room, at the Magnolia Hotel Omaha Property: |
Cash Flow Analysis
2012 | 2013 | 2014 | TTM 3/31/2015 | Underwritten | Underwritten $ per Room | |||||||||||||
Room Revenue | $4,241,941 | $4,229,804 | $4,298,655 | $4,370,880 | $4,370,880 | $30,144 | ||||||||||||
Food & Beverage Revenue | 1,234,321 | 1,433,446 | 1,453,337 | 1,444,145 | 1,444,145 | 9,960 | ||||||||||||
Other Revenue(1) | 144,943 | 143,205 | 155,836 | 151,589 | 126,951 | 876 | ||||||||||||
Parking Revenue | 157,853 | 204,045 | 193,866 | 197,747 | 184,065 | 1,269 | ||||||||||||
Total Revenue | $5,779,058 | $6,010,500 | $6,101,694 | $6,164,361 | $6,126,041 | $42,249 | ||||||||||||
Room Expense | $983,071 | $986,002 | $1,046,719 | $1,066,544 | $1,066,544 | $7,355 | ||||||||||||
Food & Beverage Expense | 943,514 | 1,026,458 | 1,069,936 | 1,061,021 | 1,061,021 | 7,317 | ||||||||||||
Other Expense | 40,484 | 56,807 | 58,236 | 56,058 | 56,058 | 387 | ||||||||||||
Parking Expense | 171,706 | 150,445 | 148,542 | 146,501 | 146,501 | 1,010 | ||||||||||||
Total Departmental Expense | $2,138,775 | $2,219,712 | $2,323,433 | $2,330,124 | $2,330,124 | $16,070 | ||||||||||||
Total Undistributed Expense | 2,044,366 | 2,093,093 | 2,157,476 | 2,171,321 | 2,170,171 | 14,967 | ||||||||||||
Total Fixed Charges | 211,243 | 216,524 | 236,940 | 243,999 | 232,954 | 1,607 | ||||||||||||
Total Operating Expenses | $4,394,384 | $4,529,329 | $4,717,849 | $4,745,444 | $4,733,249 | $32,643 | ||||||||||||
Net Operating Income | $1,384,674 | $1,481,171 | $1,383,845 | $1,418,917 | $1,392,792 | $9,605 | ||||||||||||
FF&E | 231,162 | 240,420 | 244,068 | 246,574 | 245,042 | 1,690 | ||||||||||||
Net Cash Flow | $1,153,512 | $1,240,751 | $1,139,777 | $1,172,343 | $1,147,750 | $7,916 |
(1) | Other Revenue consists of telephone revenue, pet fees, rollaway bed/crib fees, movie fees, cancelation fees, VIP package sales and dry cleaning. |
B-139 |
OAKMONT APARTMENTS |
Mortgaged Property Information | Mortgage Loan Information | |||||
Number of Mortgaged Properties | 1 | Loan Seller | GSMC | |||
Location (City/State) | Tigard, Oregon | Cut-off Date Principal Balance | $10,700,000 | |||
Property Type | Multifamily | Cut-off Date Principal Balance per Unit | $85,600.00 | |||
Size (Units) | 125 | Percentage of Initial Pool Balance | 1.5% | |||
Total Occupancy as of 5/14/2015 | 95.2% | Number of Related Mortgage Loans | None | |||
Owned Occupancy as of 5/14/2015 | 95.2% | Type of Security | Fee Simple | |||
Year Built / Latest Renovation | 1990 / 2014-2015 | Mortgage Rate | 4.1540% | |||
Appraised Value | $17,900,000 | Original Term to Maturity (Months) | 120 | |||
Original Amortization Term (Months) | 360 | |||||
Original Interest Only Period (Months) | 60 | |||||
Borrower Sponsor(1) | Thomas B. Brenneke and G. Nickolas Tri | |||||
Underwritten Revenues | $1,538,190 | |||||
Underwritten Expenses | $653,425 | Escrows | ||||
Underwritten Net Operating Income (NOI) | $884,765 | Upfront | Monthly | |||
Underwritten Net Cash Flow (NCF) | $850,515 | Taxes | $70,121 | $8,765 | ||
Cut-off Date LTV Ratio | 59.8% | Insurance | $0 | $0 | ||
Maturity Date LTV Ratio | 54.4% | Replacement Reserves(2) | $0 | $2,854 | ||
DSCR Based on Underwritten NOI / NCF | 1.42x / 1.36x | TI/LC | $0 | $0 | ||
Debt Yield Based on Underwritten NOI / NCF | 8.3% / 7.9% | Other | $0 | $0 |
Sources and Uses | ||||||
Sources | $ | % | Uses | $ | % | |
Loan Amount | $10,700,000 | 100.0% | Loan Payoff | $6,756,984 | 63.1 | % |
Principal Equity Distribution | 3,582,368 | 33.5 | ||||
Closing Costs | 290,527 | 2.7 | ||||
Reserves | 70,121 | 0.7 | ||||
Total Sources | $10,700,000 | 100.0% | Total Uses | $10,700,000 | 100.0 | % |
(1) | Thomas B. Brenneke and G. Nickolas Tri are the non-recourse carveout guarantors under the Oakmont Apartments Loan. |
(2) | Replacement Reserves are not subject to a cap requirement. |
The following table presents certain information relating to the units and rent at the Oakmont Apartments Property:
Unit Type(1) | # of Units | Average SF per Unit(2) | Monthly Market Rent per Unit(3) | Monthly Actual Rent per Unit(2) | Underwritten Monthly Rent per Unit | Underwritten Rent | ||||||||||||
1 Bed / 1 Bath | 40 | 750 | $950 | $822 | $822 | $409,996 | ||||||||||||
2 Bed / 1 Bath | 60 | 870 | $1,050 | $953 | $953 | 713,341 | ||||||||||||
2 Bed / 2 Bath | 24 | 940 | $1,100 | $1,030 | $1,030 | 308,295 | ||||||||||||
1 Bed / 1 Bath (manager) | 1 | 1,800 | $1,800 | $1,973 | $1,973 | 24,598 | ||||||||||||
Total / Wtd. Avg. | 125 | 852 | $1,225 | $934 | $934 | $1,456,200 |
(1) | As of June 10, 2015, five tenants are receiving a partial rent subsidy through Section 42 housing. The program is tenant based and is required by Oregon law. There are no subsidies, credits, bonds, etc. held against the property because of this program. So long as the tenants qualify for the subsidy on their own and meet the rental requirements of the community (criminal, rental and credit history checks), they can rent at any community in Oregon. |
(2) | As provided by the borrower. |
(3) | Source: Appraisal. |
The following table presents certain information relating to historical leasing at the Oakmont Apartments Property:
Historical Leased %(1)
2012 | 2013 | 2014 | ||
95.4 | 97.0% | 98.0% |
(1) | As provided by the borrower and represents occupancy as of December 31 for the indicated year. |
B-140 |
OAKMONT APARTMENTS |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Oakmont Apartments Property: |
Cash Flow Analysis(1)
2013 | 2014 | TTM 4/30/2015 | Underwritten | Underwritten $ per Unit | |||||||||||
Base Rent | $1,271,815 | $1,355,105 | $1,391,134 | $1,456,200 | $11,650 | ||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 72,810 | 582 | ||||||||||
Gross Potential Rent | $1,271,815 | $1,355,105 | $1,391,134 | $1,383,390 | $11,067 | ||||||||||
Vacancy, Credit Loss & Concessions | (42,112 | ) | (37,199 | ) | (45,566 | ) | (82,491 | ) | (660 | ) | |||||
Total Rent Revenue | $1,229,703 | $1,317,906 | $1,345,568 | $1,373,709 | $10,990 | ||||||||||
Other Revenue(2) | 135,579 | 172,173 | 164,481 | 164,481 | 1,316 | ||||||||||
Effective Gross Income | $1,365,283 | $1,490,079 | $1,510,049 | $1,538,190 | $12,306 | ||||||||||
Total Operating Expenses | $610,119 | $672,982 | $662,611 | $653,425 | $5,227 | ||||||||||
Net Operating Income | $755,164 | $817,097 | $847,439 | $884,765 | $7,078 | ||||||||||
Capital Expenditures | 0 | 0 | 0 | 34,250 | 274 | ||||||||||
Net Cash Flow | $755,164 | $817,097 | $847,439 | $850,515 | $6,804 |
(1) | Certain items such as straight line rent, interest expense, interest income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. |
(2) | Other revenue includes reimbursement revenue, parking and cleaning, and other miscellaneous income. |
B-141 |
BUTTERFIELD SHOPPING CENTER |
Mortgaged Property Information | Mortgage Loan Information | ||||
Number of Mortgaged Properties | 1 | Loan Seller | KGS | ||
Location (City/State) | Temecula, California | Cut-off Date Principal Balance | $10,100,000 | ||
Property Type | Retail | Cut-off Date Principal Balance per SF | $240.52 | ||
Size (SF) | 41,992 | Percentage of Initial Pool Balance | 1.4% | ||
Total Occupancy as of 4/8/2015 | 94.8% | Number of Related Mortgage Loans | None | ||
Owned Occupancy as of 4/8/2015 | 94.8% | Type of Security | Fee Simple | ||
Year Built / Latest Renovation | 2007 / NAP | Mortgage Rate | 4.8500% | ||
Appraised Value | $14,500,000 | Original Term to Maturity (Months) | 120 | ||
Original Amortization Term (Months) | 360 | ||||
Original Interest Only Period (Months) | 24 | ||||
Borrower Sponsor(1) | Mark P. Esbensen | ||||
Underwritten Revenues | $1,245,738 | ||||
Underwritten Expenses | $324,405 | Escrows | |||
Underwritten Net Operating Income (NOI) | $921,332 | Upfront | Monthly | ||
Underwritten Net Cash Flow (NCF) | $876,040 | Taxes | $8,723 | $8,723 | |
Cut-off Date LTV Ratio | 69.7% | Insurance | $6,030 | $861 | |
Maturity Date LTV Ratio | 60.0% | Replacement Reserves(2) | $0 | $469 | |
DSCR Based on Underwritten NOI / NCF | 1.44x / 1.37x | TI/LC(3) | $0 | $2,500 | |
Debt Yield Based on Underwritten NOI / NCF | 9.1% / 8.7% | Other(4) | $66,623 | $0 |
Sources and Uses | |||||||||
Sources | $ | % | Uses | $ | % | ||||
Loan Amount | $10,100,000 | 99.9 | % | Loan Payoff | $9,856,689 | 97.5 | % | ||
Principal’s New Cash Contribution | 11,294 | 0.1 | Closing Costs | 173,228 | 1.7 | ||||
Reserves | 81,376 | 0.8 | |||||||
Total Sources | $10,111,294 | 100.0 | % | Total Uses | $10,111,294 | 100.0 | % |
(1) | Mark P. Esbensen is the non-recourse carveout guarantor under the Butterfield Shopping Center Loan. | |
(2) | Replacement Reserves are subject to a cap of $30,000. | |
(3) | The on-going monthly TI/LC reserve for the first 24 months of the Butterfield Shopping Center Loan term is the difference between the actual IO debt service payment and the debt service payment calculated on a hypothetical 30 year amortization schedule. Commencing on the 25th monthly due date and on each due date thereafter, a monthly TI/LC deposit of $2,500 is required. | |
(4) | The Other Reserve is an Unfunded Obligations Reserve ($43,750) to account for outstanding tenant improvement dollars and abated rent for Aztek Tacos and Devil Dogs and a Big 5 CAM Holdback Reserve ($22,873). |
The following table presents certain information relating to the major tenants at theButterfield Shopping Center Property:
Ten Largest Tenants Based on Underwritten Base Rent
Tenant Name | Credit Rating (Fitch/MIS/S&P)(1) | Tenant GLA | % of GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | Lease Expiration | Renewal / Extension Options | |||||||||||||
Big 5 Corp. | NR / NR / NR | 10,000 | 23.8 | % | $145,200 | 15.0 | % | $14.52 | 1/31/2017 | 2, 5-year options | |||||||||||
O’Reilly’s Auto Parts | NR / Baa2 / BBB+ | 6,000 | 14.3 | 127,500 | 13.2 | 21.25 | 1/31/2022 | 2, 5-year options | |||||||||||||
Aztek Tacos | NR / NR / NR | 3,123 | 7.4 | 106,972 | 11.0 | 34.25 | 4/30/2022 | NA | |||||||||||||
Margarita Dental Group, Inc. | NR / NR / NR | 2,276 | 5.4 | 95,732 | 9.9 | 42.06 | 1/31/2018 | 1, 5-year option | |||||||||||||
Sam’s Environmental Cleaners | NR / NR / NR | 1,500 | 3.6 | 71,948 | 7.4 | 47.97 | 8/31/2017 | 1, 10-year option | |||||||||||||
Leslie’s Poolmart | NR / BB / B+ | 2,853 | 6.8 | 62,766 | 6.5 | 22.00 | 12/31/2017 | 1, 5-year option | |||||||||||||
Salon 33 | NR / NR / NR | 2,330 | 5.5 | 60,114 | 6.2 | 25.80 | 9/30/2017 | 1, 3-year option | |||||||||||||
Liquor Store | NR / NR / NR | 2,610 | 6.2 | 57,942 | 6.0 | 22.20 | 8/31/2022 | 2, 2-year options | |||||||||||||
Instyle Nails | NR / NR / NR | 1,376 | 3.3 | 51,187 | 5.3 | 37.20 | 2/28/2021 | NA | |||||||||||||
Marco’s Pizza | NR / NR / NR | 1,645 | 3.9 | 38,493 | 4.0 | 23.40 | 8/31/2019 | 2, 5-year options | |||||||||||||
Ten Largest Tenants | 33,713 | 80.3 | % | $817,854 | 84.5 | % | $24.26 | ||||||||||||||
Remaining Tenants | 6,103 | 14.5 | 150,261 | 15.5 | 24.62 | ||||||||||||||||
Vacant | 2,176 | 5.2 | 0 | 0.0 | 0.00 | ||||||||||||||||
Total / Wtd. Avg. All Tenants | 41,992 | 100.0 | % | $968,115 | 100.0 | % | $24.31 |
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
B-142 |
BUTTERFIELD SHOPPING CENTER |
The following table presents the lease rollover schedule at the Butterfield Shopping Center Property, based on initial lease expiration dates:
Lease Expiration Schedule
Year Ending December 31, | Expiring Owned GLA | % of Owned GLA | Cumulative % of Owned GLA | UW Base Rent | % of Total UW Base Rent | UW Base Rent $ per SF | # of Expiring Tenants | ||||||||||||||
MTM | 0 | 0.0 | % | 0.0% | $0 | 0.0 | % | $0.00 | 0 | ||||||||||||
2015 | 0 | 0.0 | 0.0% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2016 | 1,119 | 2.7 | 2.7% | $23,499 | 2.4 | 21.00 | 1 | ||||||||||||||
2017 | 16,683 | 39.7 | 42.4% | 340,028 | 35.1 | 20.38 | 4 | ||||||||||||||
2018 | 3,434 | 8.2 | 50.6% | 120,050 | 12.4 | 34.96 | 2 | ||||||||||||||
2019 | 2,871 | 6.8 | 57.4% | 67,917 | 7.0 | 23.66 | 2 | ||||||||||||||
2020 | 2,600 | 6.2 | 63.6% | 73,020 | 7.5 | 28.08 | 2 | ||||||||||||||
2021 | 1,376 | 3.3 | 66.9% | 51,187 | 5.3 | 37.20 | 1 | ||||||||||||||
2022 | 11,733 | 27.9 | 94.8% | 292,414 | 30.2 | 24.92 | 3 | ||||||||||||||
2023 | 0 | 0.0 | 94.8% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2024 | 0 | 0.0 | 94.8% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2025 | 0 | 0.0 | 94.8% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
2026 & Thereafter | 0 | 0.0 | 94.8% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
Vacant | 2,176 | 5.2 | 100.0% | 0 | 0.0 | 0.00 | 0 | ||||||||||||||
Total / Wtd. Avg. | 41,992 | 100.0 | % | $968,115 | 100.0 | % | $24.31 | 15 |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Butterfield Shopping Center Property: |
Cash Flow Analysis(1)
2012 | 2013 | 2014 | Underwritten | Underwritten $per SF | |||||||||||
Base Rent(2) | $1,047,567 | $1,046,869 | $937,313 | $1,033,037 | $24.60 | ||||||||||
Total Reimbursables | 225,889 | 228,036 | 226,955 | 288,000 | 6.86 | ||||||||||
Other Income | 1,084 | 850 | 465 | 0 | 0.00 | ||||||||||
Vacancy & Credit Loss | (1,577 | ) | 0 | 0 | (75,299 | ) | (1.79 | ) | |||||||
Effective Gross Income | $1,272,962 | $1,275,755 | $1,164,733 | $1,245,738 | $29.67 | ||||||||||
Real Estate Taxes | $110,541 | $111,877 | $101,632 | $104,681 | $2.49 | ||||||||||
Insurance | 6,418 | 26,445 | 21,239 | 10,036 | 0.24 | ||||||||||
CAM | 106,458 | 110,864 | 121,199 | 124,835 | 2.97 | ||||||||||
Non-Reimbursable | 30,953 | 33,934 | 34,003 | 35,023 | 0.83 | ||||||||||
Management Fee | 44,425 | 45,269 | 40,281 | 49,830 | 1.19 | ||||||||||
Total Operating Expenses | $298,795 | $328,389 | $318,354 | $324,405 | $7.73 | ||||||||||
Net Operating Income | $974,167 | $947,366 | $846,379 | $921,332 | $21.94 | ||||||||||
TI/LC | 0 | 0 | 0 | 39,665 | 0.94 | ||||||||||
Replacement Reserves | 0 | 0 | 0 | 5,627 | 0.13 | ||||||||||
Net Cash Flow | $974,167 | $947,366 | $846,379 | $876,040 | $20.86 |
(1) | Certain items such as straight line rent, interest expense, interest income, lease cancellation income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. | |
(2) | Contractual rent steps for Pet Salon and Liquor Store that occur on September 1, 2015 were included in UW Base Rent. |
B-143 |
CSS KANEOHE |
Mortgaged Property Information | Mortgage Loan Information | ||||
Number of Mortgaged Properties | 1 | Loan Seller | CGMRC | ||
Location (City/State) | Kaneohe, Hawaii | Cut-off Date Principal Balance | $9,000,000 | ||
Property Type | Self Storage | Cut-off Date Principal Balance per SF | $177.71 | ||
Size (SF) | 50,645 | Percentage of Initial Pool Balance | 1.2% | ||
Total Occupancy as of 3/26/2015 | 95.4% | Number of Related Mortgage Loans | None | ||
Owned Occupancy as of 3/26/2015 | 95.4% | Type of Security | Fee Simple | ||
Year Built / Latest Renovation | 2007 / NAP | Mortgage Rate | 3.9300% | ||
Appraised Value | $21,380,000 | Original Term to Maturity (Months) | 120 | ||
Original Amortization Term (Months) | NAP | ||||
Original Interest Only Period (Months) | 120 | ||||
Borrower Sponsors(1) | Timothy D. Davis, Robert J. Dailey, Thomas A. Dailey, William D. Schmicker and Dwight W. Davis | ||||
Underwritten Revenues | $1,703,266 | ||||
Underwritten Expenses | $578,477 | Escrows | |||
Underwritten Net Operating Income (NOI) | $1,124,788 | Upfront | Monthly | ||
Underwritten Net Cash Flow (NCF) | $1,117,191 | Taxes | $40,929 | $8,186 | |
Cut-off Date LTV Ratio | 42.1% | Insurance | $0 | $0 | |
Maturity Date LTV Ratio | 42.1% | Replacement Reserves | $0 | $0 | |
DSCR Based on Underwritten NOI / NCF | 3.14x / 3.12x | TI/LC | $0 | $0 | |
Debt Yield Based on Underwritten NOI / NCF | 12.5% / 12.4% | Other | $0 | $0 |
Sources and Uses | |||||||||
Sources | $ | % | Uses | $ | % | ||||
Loan Amount | $9,000,000 | 99.6 | % | Loan Payoff | $5,137,969 | 56.9 | % | ||
Other Sources | 35,000 | 0.4 | Principal Equity Distribution | 3,651,786 | 40.4 | ||||
Closing Costs | 204,316 | 2.3 | |||||||
Reserves | 40,929 | 0.5 | |||||||
Total Sources | $9,035,000 | 100.0 | % | Total Uses | $9,035,000 | 100.0 | % |
(1) | Timothy D. Davis, Robert J. Dailey, Thomas A. Dailey, William D. Schmicker and Dwight W. Davis are the non-recourse carveout guarantors under the CSS Kaneohe Loan. |
The following table presents certain information relating to historical leasing at the CSS Kaneohe Property:
Historical Leased %(1)
2012 | 2013 | 2014 | ||||
Owned Space | 85.5% | 92.0% | 93.7% |
(1) | As provided by the borrower and which represents average occupancy for the specified year. |
B-144 |
CSS KANEOHE |
n | Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the CSS Kaneohe Property: |
Cash Flow Analysis(1)
2012 | 2013 | 2014 | TTM 3/31/2015 | Underwritten | Underwritten $per SF | |||||||||||||
Base Rent | $1,416,055 | $1,580,641 | $1,682,926 | $1,689,606 | $1,694,448 | $33.46 | ||||||||||||
Gross Up Vacancy | 0 | 0 | 0 | 0 | 86,496 | 1.71 | ||||||||||||
Goss Potential Rent | $1,416,055 | $1,580,641 | $1,682,926 | $1,689,606 | $1,780,944 | $35.17 | ||||||||||||
Vacancy, Credit Loss & Concessions | 0 | 0 | 0 | 0 | (178,094 | ) | (3.52 | ) | ||||||||||
Total Rent Revenue | $1,416,055 | $1,580,641 | $1,682,926 | $1,689,606 | $1,602,850 | $31.65 | ||||||||||||
Other Revenue(2) | 59,123 | 104,253 | 101,317 | 100,416 | 100,416 | 1.98 | ||||||||||||
Effective Gross Income | $1,475,178 | $1,684,894 | $1,784,243 | $1,790,022 | $1,703,266 | $33.63 | ||||||||||||
Total Operating Expenses | $514,605 | $559,561 | $583,184 | $577,609 | $578,477 | $11.42 | ||||||||||||
Net Operating Income | $960,573 | $1,125,333 | $1,201,059 | $1,212,413 | $1,124,788 | $22.21 | ||||||||||||
Replacement Reserves | 0 | 0 | 0 | 0 | 7,597 | 0.15 | ||||||||||||
Net Cash Flow | $960,573 | $1,125,333 | $1,201,059 | $1,212,413 | $1,117,191 | $22.06 |
(1) | Certain items such as straight line rent, interest expense, interest income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow. | |
(2) | Other Revenue includes cell tower rent, electric reimbursements and other miscellaneous income. |
B-145 |
SUMMARY OF CERTAIN RISK FACTORS |
Investors should review the Prospectus Supplement and the Base Prospectus, including the description of risk factors contained in the Prospectus Supplement and the Base Prospectus, prior to making a decision to invest in the certificates offered by this Term Sheet. The Prospectus Supplement and the Base Prospectus will include more complete descriptions of the risks described below as well as additional risks relating to, among other things, specific mortgage loans and specific property types. Any decision to invest in the offered certificates should be made after reviewing the Prospectus Supplement and the Base Prospectus, conducting such investigations as the investor deems necessary and consulting with the investor’s own legal, accounting and tax advisors in order to make an independent determination of the suitability and consequences of an investment in the offered certificates. Capitalized terms used but not defined in this Term Sheet shall have the respective meanings assigned to such terms in the Prospectus Supplement or, if not defined in the Prospectus Supplement, in the Base Prospectus.
n | The Volatile Economy, Credit Crisis and Downturn in the Real Estate Market Have Adversely Affected and May Continue to Adversely Affect the Value of CMBS |
— | In recent years, the real estate and securitization markets, including the market for commercial mortgage-backed securities (“CMBS”), as well as global financial markets and the economy generally, have experienced significant dislocations, illiquidity and volatility. We cannot assure you that a dislocation in the CMBS market will not re-occur or become more severe. |
n | The Offered Certificates May Not Be a Suitable Investment for You |
— | The offered certificates are not suitable investments for all investors. In particular, you should not purchase any class of offered certificates unless you understand and are able to bear the risk that the yield to maturity and the aggregate amount and timing of distributions on the offered certificates are subject to material variability from period to period and give rise to the potential for significant loss over the life of the offered certificates. |
— | An investment in the offered certificates should be considered only by sophisticated institutional investors with substantial investment experience with similar types of securities and who have conducted appropriate due diligence on the mortgage loans and the offered certificates. |
n | The Offered Certificates Are Limited Obligations |
— | The offered certificates, when issued, will represent beneficial interests in the issuing entity. The offered certificates will not represent an interest in, or obligation of, the sponsors, the depositor, the master servicer, the special servicer, the operating advisor, the certificate administrator, the trustee, the underwriters, or any of their respective affiliates, or any other person. |
— | The primary assets of the issuing entity will be the notes evidencing the mortgage loans, and the primary security and source of payment for the mortgage loans will be the mortgaged properties and the other collateral described in the Prospectus Supplement. Payments on the offered certificates are expected to be derived from payments made by the borrowers on the mortgage loans. |
n | Mortgage Loans Are Non-Recourse and Are Not Insured or Guaranteed |
— | The mortgage loans are not insured or guaranteed by any person or entity, governmental or otherwise. |
— | Investors should treat each mortgage loan as a non-recourse loan. If a default occurs, recourse generally may be had only against the specific properties and other assets that have been pledged to secure the loan. Consequently, payment prior to maturity is dependent primarily on the sufficiency of the net operating income of the mortgaged property. Payment at maturity is primarily dependent upon the market value of the mortgaged property and the borrower’s ability to sell or refinance the mortgaged property. |
n | The Offered Certificates May Have Limited Liquidity and the Market Value of the Offered Certificates May Decline |
— | Your certificates will not be listed on any national securities exchange or traded on any automated quotation systems of any registered securities association, and there is currently no secondary market for your certificates. While we have been advised by the underwriters that one or more of them, or one or more of their affiliates, currently intend to make a market in the offered certificates, none of the underwriters has any obligation to do so, any market-making may be discontinued at any time, and we cannot assure you that an active secondary market for the offered certificates will develop. |
— | The market value of the offered certificates will also be influenced by the supply of and demand for CMBS generally. The supply of CMBS will depend on, among other things, the amount of commercial and multifamily mortgage loans, whether newly originated or held in portfolios, that are available for securitization. |
n | Legal and Regulatory Provisions Affecting Investors Could Adversely Affect the Liquidity of the Offered Certificates |
— | We make no representation as to the proper characterization of the offered certificates for legal investment, financial institution regulatory, financial reporting or other purposes, as to the ability of particular investors to purchase the offered certificates under applicable legal investment or other restrictions or as to the consequences of an investment in the offered certificates for such purposes or under such restrictions. We note that regulatory or legislative provisions applicable to certain investors may have the effect of limiting or restricting their ability to hold or acquire CMBS, which in turn may adversely affect the ability of investors in the offered certificates who are not subject to those provisions to resell their certificates in the secondary market. For example: |
B-146 |
SUMMARY OF CERTAIN RISK FACTORS (continued) |
— | Effective January 1, 2014, EU Regulation 575/2013 (the “CRR”) imposes on European Economic Area (“EEA”) credit institutions and investment firms investing in securitizations issued on or after January 1, 2011, or in securitizations issued prior to that date where new assets are added or substituted after December 31, 2014: (a) a requirement (the “Retention Requirement”) that the originator, sponsor or original lender of such securitization has explicitly disclosed that it will retain, on an ongoing basis, a material net economic interest which, in any event, shall not be less than 5%; and (b) a requirement (the “Due Diligence Requirement”) that the investing credit institution or investment firm has undertaken certain due diligence in respect of the securitization and the underlying exposures and has established procedures for monitoring them on an ongoing basis. National regulators in EEA member states are required to impose penal risk weights on securitization investments in respect of which the Retention Requirement or the Due Diligence Requirement has not been satisfied in any material respect by reason of the negligence or omission of the investing credit institution or investment firm. If the Retention Requirement or the Due Diligence Requirement is not satisfied in respect of a securitization investment held by a non-EEA subsidiary of an EEA credit institution or investment firm, then an additional risk weight may be applied to such securitization investment when taken into account on a consolidated basis at the level of the EEA credit institution or investment firm. Requirements similar to the Retention Requirement and the Due Diligence Requirement (the “Similar Requirements”): (i) apply to investments in securitizations by investment funds managed by EEA investment managers subject to EU Directive 2011/61/EU; and (ii) subject to the adoption of certain secondary legislation, will apply to investments in securitizations by EEA insurance and reinsurance undertakings and by EEA undertakings for collective investment in transferable securities. None of the originators, the sponsors, the depositor or the issuing entity intends to retain a material net economic interest in the securitization constituted by the issue of the certificates in accordance with Retention Requirement or to take any other action which may be required by EEA-regulated investors for the purposes of their compliance with Retention Requirement, the Due Diligence Requirement or Similar Requirements. Consequently, credit institutions, investment firms or the other types of EEA regulated investors mentioned above are unlikely to be able to hold the certificates. As a result, the price and liquidity of the offered certificates in the secondary market may be adversely affected. This could adversely affect your ability to transfer offered certificates or the price you may receive upon your sale of offered certificates. |
— | The Dodd-Frank Wall Street Reform and Consumer Protection Act enacted in the United States requires that federal banking agencies amend their regulations to remove reference to or reliance on credit agency ratings, including, but not limited to, those found in the federal banking agencies’ risk-based capital regulations. New capital regulations, which were adopted by the banking regulators in July 2013 and began phasing in on January 1, 2014, implement the increased capital requirements established under the Basel Accord. These new capital regulations eliminate reliance on credit ratings and otherwise alter, and in most cases increase, the capital requirements imposed on depository institutions and their holding companies, including with respect to ownership of asset-backed securities such as CMBS. As a result of these regulations, investments in CMBS like the certificates by institutions subject to the risk based capital regulations may result in greater capital charges to these financial institutions, and the treatment of CMBS for their regulatory capital purposes may otherwise be adversely affected. Such developments could reduce the attractiveness of investments in CMBS for such entities. |
— | Section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act added a provision, commonly referred to as the “Volcker Rule,” to federal banking law to generally prohibit “banking entities” (which is broadly defined to include U.S. banks and bank holding companies and many non-U.S. banking entities, together with their respective subsidiaries and other affiliates) from (i) engaging in proprietary trading, (ii) acquiring or retaining an ownership interest in or sponsoring a “covered fund” and (iii) entering into certain relationships with such funds. The Volcker Rule became effective on July 21, 2012, and final regulations implementing the Volcker Rule were adopted on December 10, 2013 and became effective on April 1, 2014. Conformance with the Volcker Rule and its implementing regulations is required by July 21, 2015 (or by July 21, 2016 in respect of investments in and relationships with covered funds that were in place prior to December 31, 2013, with the possibility of a further one-year extension). In the interim, banking entities must make good-faith efforts to conform their activities and investments to the Volcker Rule. Under the Volcker Rule, unless otherwise jointly determined otherwise by specified federal regulators, a “covered fund” does not include an issuer that may rely on an exclusion or exemption from the definition of “investment company” under the Investment Company Act other than the exclusions contained in Section 3(c)(1) and Section 3(c)(7) of the Investment Company Act. The general effects of the Volcker Rule remain uncertain. Any prospective investor in the certificates, including a U.S. or foreign bank or a subsidiary or other affiliate thereof, should consult its own legal advisors regarding such matters and other effects of the Volcker Rule. |
— | The Financial Accounting Standards Board has adopted changes to the accounting standards for structured products. These changes, or any future changes, may affect the accounting for entities such as the issuing entity, could under certain circumstances require an investor or its owner generally to consolidate the assets of the issuing entity in its financial statements and record third parties’ investments in the issuing entity as liabilities of that investor or owner or could otherwise adversely affect the manner in which the investor or its owner must report an investment in commercial mortgage-backed securities for financial reporting purposes. |
— | For purposes of the Secondary Mortgage Market Enhancement Act of 1984, as amended, no class of offered certificates will constitute “mortgage related securities”. |
B-147 |
SUMMARY OF CERTAIN RISK FACTORS (continued) |
n | Commercial and Multifamily Lending Is Dependent on Net Operating Income |
— | The repayment of the mortgage loans in the pool (or related loan combination) will be dependent upon the ability of the related mortgaged property to produce cash flow through the collection of rents. However, net operating income can be volatile and may be insufficient to cover debt service on a mortgage loan (or related loan combination) at any given time. The performance and/or value of a particular income-producing real property will depend on a number of variables, including but not limited to property type, geographic location, competition and sponsorship. |
n | Risks Resulting from Various Concentrations |
— | The performance of the pool of mortgage loans may be adversely impacted as a result of (i) mortgage loans that account for a disproportionately large percentage of the pool’s aggregate principal balance, (ii) a concentration of mortgage loans secured by the same mortgaged property types, (iii) a concentration of mortgage loans secured by mortgaged properties located in a particular geographic area, (iv) a concentration of mortgage loans secured by mortgaged properties with the same tenant(s) and (v) a concentration of mortgage loans with the same borrower or related borrowers. The effect of loan pool losses will be more severe if the losses relate to mortgage loans that account for a disproportionately large percentage of the pool’s aggregate principal balance. Likewise, mortgaged properties in which a single tenant makes up a significant portion of the rental income are more susceptible to interruptions of cash flow if that tenant’s business operations are negatively impacted or if such tenant fails to renew its lease. |
— | A concentration of related borrowers, mortgaged property types, tenant occupancy or mortgaged properties in similar geographic regions can pose increased risks because a decline in the financial condition of the corporate family of the related borrowers, in a particular industry or business or in a particular geographic area would have a disproportionately large impact on the pool of mortgage loans. |
n | Borrower May Be Unable to Repay Remaining Principal Balance on the Maturity Date or Anticipated Repayment Date |
— | Mortgage loans (or loan combinations) with substantial remaining principal balances at their stated maturity date involve greater risk than fully-amortizing mortgage loans. This is because the borrower may be unable to repay the mortgage loan at that time. A borrower’s ability to repay a mortgage loan (or loan combinations) on its stated maturity or anticipated repayment date typically will depend upon its ability either to refinance the mortgage loan (or loan combinations) or to sell the mortgaged property at a price sufficient to permit repayment. |
n | The Timing of Prepayments and Repurchases May Change Your Anticipated Yield |
— | We are not aware of any relevant publicly available or authoritative statistics with respect to the historical prepayment experiences of commercial mortgage loans, including both voluntary prepayments, if permitted, and involuntary prepayments, such as prepayments resulting from casualty or condemnation, application of reserve funds, defaults and liquidations or repurchases upon breaches of representations and warranties or material document defects or purchases by the holder of a subordinate companion loan or a mezzanine lender pursuant to a purchase option or sales of defaulted mortgage loans. |
— | Any changes in the weighted average lives of your certificates may adversely affect your yield. |
— | Each sponsor is the sole warranting party in respect of the mortgage loans sold by such sponsor to the depositor and (except for RAIT Funding, LLC and KGS-Alpha Real Estate Capital Markets, LLC, each of which has a back-up guarantor) the sole party with repurchase/substitution obligations in connection with a material breach of representation and warranty or a material document deficiency. We cannot assure you that the applicable sponsor (or sponsor guarantor, if applicable) will have the financial ability to repurchase or substitute any mortgage loan sold by it in connection with either a material breach of the applicable sponsor’s representations and warranties or any material document defects. |
n | Litigation Regarding the Mortgaged Properties or Borrowers May Impair Your Distributions |
— | There may be (and there may exist from time to time) pending or threatened legal proceedings against, or disputes with, the borrowers, the property sponsors and the managers of the mortgaged properties and their respective affiliates arising out of their ordinary business. Any such litigation may materially impair distributions to certificateholders if borrowers or property sponsors must use property income or other income to pay judgments, legal fees or litigation costs. We cannot assure you that any litigation or dispute or any settlement of any litigation or dispute will not have a material adverse effect on your investment. |
n | Appraisals May Not Reflect Current or Future Market Value of Each Property |
— | Appraisals were obtained with respect to each of the mortgaged properties at or about the time of origination of the applicable mortgage loan by the related originator, or at or around the time of the acquisition of the mortgage loan by the related sponsor. In general, appraisals represent the analysis and opinion of qualified appraisers and are not guarantees of present or future value. |
— | Prospective investors should consider that the information set forth in this Term Sheet regarding appraised values or loan to value ratios may not accurately reflect past, present or future market values of the mortgaged properties. Additionally, with respect to the appraisals setting forth assumptions as to the “as-is”, “as stabilized/as completed”, “as stabilized”, “prospective market value upon stabilization” or other values, prospective investors should consider that those assumptions may not be accurate and that the “as-is”, “as stabilized/as completed”, “as stabilized”, “prospective market value upon stabilization” or other values may not be the values of the related mortgaged properties prior to or at maturity. |
B-148 |
SUMMARY OF CERTAIN RISK FACTORS (continued) |
n | Adverse Environmental Conditions at or Near Mortgaged Properties May Result in Losses |
— | The issuing entity could become liable for a material adverse environmental condition at an underlying mortgaged property. Any such potential liability could reduce or delay payments on the offered certificates. |
— | Although an environmental report was prepared for each mortgaged property securing a mortgage loan in connection with origination, it is possible that the environmental reports and/or supplemental “Phase II” sampling did not reveal all environmental liabilities, or that there are material environmental liabilities of which we are not aware. Also, the environmental condition of the mortgaged properties in the future could be affected by the activities of tenants and occupants or by third parties unrelated to the borrowers. |
n | Insurance May Not Be Available or Adequate |
— | Although the mortgaged properties are required to be insured, or permitted to be self-insured by a sole or significant tenant, against certain risks, there is a possibility of casualty loss with respect to the mortgaged properties for which insurance proceeds may not be adequate or which may result from risks not covered by insurance. |
— | Even if terrorism insurance is required by the loan documents for a mortgage loan, that requirement may be subject to a cap on the cost of the premium for terrorism insurance that a borrower is required to pay or a commercially reasonable standard on the availability of the insurance. |
— | We cannot assure you that terrorism insurance or the Terrorism Insurance Program will be available or provide sufficient protection against risks of loss on the mortgaged properties resulting from acts of terrorism. |
n | The Mortgage Loan Sellers, the Sponsors and the Depositor Are Subject to Bankruptcy or Insolvency Laws That May Affect the Issuing Entity’s Ownership of the Mortgage Loans |
— | In the event of the bankruptcy, insolvency, receivership or conservatorship of an originator, a mortgage loan seller or the depositor (or certain affiliates thereof), it is possible that the issuing entity’s right to payment from or ownership of certain of the mortgage loans could be challenged. If such challenge is successful, payments on the offered certificates would be reduced or delayed. Even if the challenge is not successful, payments on the offered certificates would be delayed while a court resolves the claim. |
— | An opinion of counsel will be rendered on the Closing Date to the effect that the transfer of the applicable mortgage loans by each mortgage loan seller to the depositor would generally be respected as a sale in the event of the bankruptcy or insolvency of such mortgage loan seller. Such opinions, however, are subject to various assumptions and qualifications, and there can be no assurance that a bankruptcy trustee (in the case of the mortgage loan sellers other than Goldman Sachs Mortgage Company), if applicable, or other interested party will not attempt to challenge the issuing entity’s right to payment with respect to the related mortgage loans. Legal opinions do not provide any guaranty as to what any particular court would actually decide, but rather an opinion as to the decision a court would reach if the issues were competently presented and the court followed existing precedent as to legal and equitable principles applicable in bankruptcy cases. In this regard, legal opinions on bankruptcy law matters have inherent limitations primarily because of the pervasive equity powers of bankruptcy courts, the overriding goal of reorganization to which other legal rights and other policies may be subordinated, the potential relevance to the exercise of judicial discretion of future arising facts and circumstances, and the nature of the bankruptcy process. As a result, the Federal Deposit Insurance Corporation (the “FDIC”), a creditor, a bankruptcy trustee or another interested party, including an entity transferring a mortgage loan as debtor-in-possession, could still attempt to assert that the transfer of a mortgage loan was not a sale. If such party’s challenge were successful, payments on the certificates would be reduced or delayed. Even if the challenge were not successful, payments on the certificates would be delayed while a court resolves the claim. |
— | Goldman Sachs Mortgage Company, a sponsor and an originator, is an indirect, wholly owned subsidiary of Goldman Sachs Bank USA (“GS Bank”), a New York State chartered bank, the deposits of which are insured by the FDIC. If GS Bank were to become subject to receivership, the proceeding would be administered by the FDIC under the Federal Deposit Insurance Act (the “FDIA”); likewise, if GS Bank were to become subject to conservatorship, the agency appointed as conservator would likely be the FDIC as well. The FDIA gives the FDIC the power to disaffirm or repudiate contracts to which a bank is party at the time of receivership or conservatorship and the performance of which the FDIC determines to be burdensome, in which case the counterparty to the contract has a claim for payment by the receivership or conservatorship estate of “actual direct compensatory damages” as of the date of receivership or conservatorship. The FDIC has adopted a rule, substantially revised and effective January 1, 2011, establishing a safe harbor (the “FDIC Safe Harbor”) from its repudiation powers for securitizations meeting the requirements of the rule (12 C.F.R. § 360.6). The transfer of the applicable mortgage loans by Goldman Sachs Mortgage Company to the depositor will not qualify for the FDIC Safe Harbor. However, the transfer by Goldman Sachs Mortgage Company is not a transfer by a bank, and in any event, even if the FDIC Safe Harbor were applicable to such transfer, the FDIC Safe Harbor is non-exclusive. Notwithstanding the foregoing and that true sale opinions will be rendered on the Closing Date, the FDIC, a creditor, bankruptcy trustee or another interested party, including an entity transferring a mortgage loan, as debtor-in-possession, could still attempt to assert that the transfer of a mortgage loan by any of the sponsors was not a sale. |
B-149 |
SUMMARY OF CERTAIN RISK FACTORS (continued) |
n | Potential Conflicts of Interest of the Sponsors, Underwriters, the Master Servicer, the Special Servicer, the Operating Advisor, a Directing Holder, the Controlling Class Representative, any Companion Loan Holders and Mezzanine Lenders |
— | The sponsors, the underwriters, the master servicer, the special servicer, the operating advisor, a Directing Holder, the Controlling Class Representative, the holder of a companion loan (or its representative) or the holder of a mezzanine loan or any of their respective affiliates and/or sub-servicers, as applicable, may have interests when dealing with the mortgage loans that are in conflict with those of holders of the offered certificates, especially if the sponsors, the underwriters, the master servicer, the special servicer, the operating advisor, a Directing Holder, the Controlling Class Representative, the holder of a companion loan (or its representative) or the holder of a mezzanine loan or any of their respective affiliates and/or sub-servicers, as applicable, holds certificates, or has financial interests in or other financial dealings with a borrower or an affiliate of the borrower. Each of these relationships may create a conflict of interest and should be considered carefully by you before you invest in any offered certificates. |
n | Potential Conflicts of Interest in the Selection of the Underlying Mortgage Loans |
— | The anticipated initial investor in certain of the subordinate certificates (the “B-Piece Buyer”) was given the opportunity by the sponsors to perform due diligence on the mortgage loans originally identified by the sponsors for inclusion in the issuing entity, and to request the removal, re-sizing or change in other features of some or all of the mortgage loans. The mortgage pool as originally proposed by the sponsors was adjusted based on some of these requests. In addition, the B-Piece Buyer received or may receive price adjustments or cost mitigation arrangements in connection with accepting certain mortgage loans in the mortgage pool. Actions of the B-Piece Buyer may be adverse to those of purchasers of the offered certificates. |
n | Interests and Incentives of the Originators, the Sponsors and Their Affiliates May Not Be Aligned with Your Interests |
— | The originators, the sponsors and their affiliates (including certain of the underwriters) expect to derive ancillary benefits from this offering of offered certificates and their respective incentives may not be aligned with those of purchasers of the offered certificates. The sponsors originated or purchased the mortgage loans in order to securitize the mortgage loans by means of a transaction such as this offering of the offered certificates. The sponsors will sell the mortgage loans to the depositor (an affiliate of Citigroup Global Markets RealtyCorp., one of the sponsors, and Citigroup Global Markets Inc., one of the underwriters) on the Closing Date in exchange for cash, derived from the sale of the offered certificates to investors, and/or in exchange for offered certificates. A completed offering would reduce the sponsors’ and/or their respective affiliates’ exposure to the mortgage loans. The offering of offered certificates will effectively transfer the sponsors’ and/or their respective affiliates’ exposure to the mortgage loans to purchasers of the offered certificates and the other certificates of the same series. |
— | The originators, the sponsors and their affiliates (including certain of the underwriters) expect to receive various benefits, including compensation, commissions, payments, rebates, remuneration and business opportunities in connection with or as a result of this offering of offered certificates and their interests in the mortgage loans. |
— | Each of the foregoing relationships should be considered carefully by you before you invest in any offered certificates. |
n | Interests and Incentives of the Underwriter Entities May Not Be Aligned with Your Interests |
— | The activities and interests of the underwriters and their respective affiliates (collectively, the “Underwriter Entities”) will not align with, and may in fact be directly contrary to, those of the certificateholders. The Underwriter Entities are each part of separate global investment banking, securities and investment management firms that provide a wide range of financial services to a substantial and diversified client base that includes corporations, financial institutions, governments and high-net-worth individuals. As such, they actively make markets in and trade financial instruments for their own account and for the accounts of customers. |
— | The Underwriter Entities’ activities include, among other things, executing large block trades and taking long and short positions directly and indirectly, through derivative instruments or otherwise. The securities and instruments in which the Underwriter Entities take positions, or expect to take positions, include loans similar to the mortgage loans, securities and instruments similar to the offered certificates and other securities and instruments. Market making is an activity where the Underwriter Entities buy and sell on behalf of customers, or for their own account, to satisfy the expected demand of customers. By its nature, market making involves facilitating transactions among market participants that have differing views of securities and instruments. As a result, you should expect that the Underwriter Entities will take positions that are inconsistent with, or adverse to, the investment objectives of investors in the offered certificates. |
— | If an Underwriter Entity becomes a holder of any of the certificates, through market-making activity or otherwise, any actions that it takes in its capacity as a certificateholder, including voting, providing consents or otherwise will not necessarily be aligned with the interests of other holders of the same class or other classes of the certificates. |
— | In addition, the Underwriter Entities will have no obligation to monitor the performance of the certificates or the actions of the master servicer, the special servicer, the certificate administrator, the trustee or the operating advisor and will have no authority to advise the master servicer, the special servicer, the certificate administrator, the trustee or the operating advisor or to direct their actions. |
— | Each of the foregoing affiliations and relationships should be considered carefully by you before you invest in any offered certificates. |
B-150 |
SUMMARY OF CERTAIN RISK FACTORS (continued) |
n | Other Rating Agencies May Assign Different Ratings to the Certificates |
— | Other nationally recognized statistical rating organizations that the depositor did not engage to rate the offered certificates may nevertheless issue unsolicited credit ratings on one or more classes of offered certificates. If any such unsolicited ratings are issued, we cannot assure you that they will not be different from any ratings assigned by the rating agencies engaged by the depositor. The issuance of unsolicited ratings by any nationally recognized statistical rating organization on one or more classes of the offered certificates that are different from ratings assigned by a rating agency engaged by the depositor may adversely impact the liquidity, market value and regulatory characteristics of that class. |
n | Tax Considerations |
— | The offered certificates will represent ownership (directly or through a grantor trust) of one or more regular interests in one or more real estate mortgage investment conduits (each a “REMIC”) for U.S. federal income tax purposes. |
— | Special tax considerations may apply to certain types of investors. Prospective investors should consult their own tax advisors regarding tax implications of an investment in the offered certificates. |
— | State, local and other tax laws may differ substantially from the corresponding federal law. Prospective investors should consult with their own tax advisors with respect to the various state, local and other tax consequences of an investment in the offered certificates. |
B-151 |
(THIS PAGE INTENTIONALLY LEFT BLANK)
ANNEX C
MORTGAGE POOL INFORMATION
(THIS PAGE INTENTIONALLY LEFT BLANK)
Distribution of Loan Purpose | ||||||||||||||||||||||||
Loan Purpose | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | Average Cut- off Date Balance | Weighted Average Debt Service Coverage Ratio | Weighted Average Mortgage Interest Rate | Weighted Average Remaining Terms to Maturity (Mos) | Weighted Average Cut-off Date LTV | Weighted Average Maturity Date / ARD LTV | |||||||||||||||
Refinance | 39 | $ | 626,746,237 | 86.6 | % | $ | 16,070,416 | 2.41x | 4.029% | 118.1 | 59.6% | 51.8% | ||||||||||||
Acquisition | 11 | 96,577,633 | 13.4 | $ | 8,779,785 | 1.53x | 4.436% | 118.5 | 68.3% | 58.2% | ||||||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | ||||||||||||
Distribution of Amortization Types(1) | ||||||||||||||||||||||||
Amortization Type | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | Average Cut- off Date Balance | Weighted Average Debt Service Coverage Ratio | Weighted Average Mortgage Interest Rate | Weighted Average Remaining Terms to Maturity (Mos) | Weighted Average Cut-off Date LTV | Weighted Average Maturity Date / ARD LTV | |||||||||||||||
Amortizing (20 Years) | 1 | $ | 4,288,794 | 0.6 | % | $ | 4,288,794 | 1.18x | 4.400% | 119.0 | 72.7% | 44.8% | ||||||||||||
Amortizing (25 Years) | 2 | 6,787,726 | 0.9 | $ | 3,393,863 | 1.82x | 4.515% | 119.0 | 63.2% | 45.2% | ||||||||||||||
Amortizing (30 Years) | 16 | 209,663,989 | 29.0 | $ | 13,103,999 | 1.84x | 4.188% | 117.5 | 64.0% | 50.5% | ||||||||||||||
Interest Only, Then Amortizing(2) | 26 | 294,228,360 | 40.7 | $ | 11,316,475 | 1.53x | 4.322% | 118.9 | 69.4% | 60.3% | ||||||||||||||
Interest Only - ARD | 1 | 100,000,000 | 13.8 | $ | 100,000,000 | 5.42x | 3.295% | 118.0 | 30.3% | 30.3% | ||||||||||||||
Interest Only | 4 | 108,355,000 | 15.0 | $ | 27,088,750 | 2.39x | 3.920% | 117.7 | 58.2% | 57.5% | ||||||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | ||||||||||||
(1) All of the mortgage loans will have balloon payments at maturity date. | ||||||||||||||||||||||||
(2) Original partial interest only months range from 12 to 72 months. | ||||||||||||||||||||||||
Distribution of Cut-off Date Balances | ||||||||||||||||||||||||
Range of Cut-off Balances ($) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | Average Cut- off Date Balance | Weighted Average Debt Service Coverage Ratio | Weighted Average Mortgage Interest Rate | Weighted Average Remaining Terms to Maturity (Mos) | Weighted Average Cut-off Date LTV | Weighted Average Maturity Date / ARD LTV | |||||||||||||||
2,350,000 - 4,999,999 | 15 | $ | 55,774,266 | 7.7 | % | $ | 3,718,284 | 1.61x | 4.471% | 117.0 | 65.7% | 51.7% | ||||||||||||
5,000,000 - 9,999,999 | 16 | 106,179,390 | 14.7 | $ | 6,636,212 | 1.82x | 4.255% | 118.7 | 60.6% | 51.3% | ||||||||||||||
10,000,000 - 14,999,999 | 7 | 85,396,418 | 11.8 | $ | 12,199,488 | 1.58x | 4.358% | 118.0 | 66.2% | 53.5% | ||||||||||||||
15,000,000 - 19,999,999 | 1 | 15,093,360 | 2.1 | $ | 15,093,360 | 1.17x | 4.420% | 119.0 | 75.1% | 64.0% | ||||||||||||||
20,000,000 - 29,999,999 | 7 | 175,076,457 | 24.2 | $ | 25,010,922 | 1.70x | 4.197% | 118.7 | 67.1% | 58.0% | ||||||||||||||
30,000,000 - 69,999,999 | 1 | 42,000,000 | 5.8 | $ | 42,000,000 | 1.62x | 4.130% | 119.0 | 73.9% | 68.6% | ||||||||||||||
70,000,000 - 100,000,000 | 3 | 243,803,978 | 33.7 | $ | 81,267,993 | 3.51x | 3.713% | 117.7 | 50.0% | 45.9% | ||||||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | ||||||||||||
Min | $ | 2,350,000 | ||||||||||||||||||||||
Max | $ | 100,000,000 | ||||||||||||||||||||||
Average | $ | 14,466,477 | ||||||||||||||||||||||
C-1 |
Distribution of Underwritten Debt Service Coverage Ratios | |||||||||||||||||||||
Range of Underwritten Debt Service Coverage Ratios (x) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | Average Cut-off Date Balance | Weighted Average Debt Service Coverage Ratio | Weighted Average Mortgage Interest Rate | Weighted Average Remaining Terms to Maturity (Mos) | Weighted Average Cut-off Date LTV | Weighted Average Maturity Date / ARD LTV | ||||||||||||
1.17 - 1.30 | 3 | $ | 25,682,154 | 3.6 | % | $ | 8,560,718 | 1.19x | 4.387% | 118.8 | 70.3% | 58.8% | |||||||||
1.31 - 1.50 | 13 | 147,185,564 | 20.3 | $ | 11,321,966 | 1.41x | 4.339% | 118.6 | 67.9% | 58.3% | |||||||||||
1.51 - 1.70 | 17 | 207,925,991 | 28.7 | $ | 12,230,941 | 1.62x | 4.254% | 118.8 | 70.3% | 59.1% | |||||||||||
1.71 - 1.90 | 8 | 44,908,283 | 6.2 | $ | 5,613,535 | 1.81x | 4.366% | 115.3 | 62.5% | 51.1% | |||||||||||
1.91 - 2.10 | 1 | 5,237,304 | 0.7 | $ | 5,237,304 | 1.95x | 4.690% | 118.0 | 64.7% | 39.3% | |||||||||||
2.11 - 2.30 | 3 | 147,197,656 | 20.4 | $ | 49,065,885 | 2.17x | 4.010% | 117.5 | 63.8% | 56.5% | |||||||||||
2.31 - 2.90 | 3 | 36,186,917 | 5.0 | $ | 12,062,306 | 2.73x | 3.921% | 119.0 | 43.4% | 41.0% | |||||||||||
2.91 - 5.42 | 2 | 109,000,000 | 15.1 | $ | 54,500,000 | 5.23x | 3.347% | 118.1 | 31.3% | 31.3% | |||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | |||||||||
Min | 1.17 | ||||||||||||||||||||
Max | 5.42 | ||||||||||||||||||||
Average | 2.29 | ||||||||||||||||||||
Distribution of Mortgage Interest Rates | |||||||||||||||||||||
Range of Mortgage Interest Rates (%) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | Average Cut-off Date Balance | Weighted Average Debt Service Coverage Ratio | Weighted Average Mortgage Interest Rate | Weighted Average Remaining Terms to Maturity (Mos) | Weighted Average Cut-off Date LTV | Weighted Average Maturity Date / ARD LTV | ||||||||||||
3.295 - 4.000 | 9 | $ | 273,741,530 | 37.8 | % | $ | 30,415,726 | 3.37x | 3.696% | 117.9 | 48.7% | 45.3% | |||||||||
4.001 - 4.250 | 9 | 177,673,739 | 24.6 | $ | 19,741,527 | 1.80x | 4.125% | 118.5 | 67.6% | 57.9% | |||||||||||
4.251 - 4.500 | 21 | 204,660,059 | 28.3 | $ | 9,745,717 | 1.48x | 4.370% | 118.8 | 69.2% | 58.1% | |||||||||||
4.501 - 4.750 | 9 | 54,798,542 | 7.6 | $ | 6,088,727 | 1.68x | 4.640% | 116.2 | 65.1% | 51.0% | |||||||||||
4.751 - 4.850 | 2 | 12,450,000 | 1.7 | $ | 6,225,000 | 1.44x | 4.835% | 118.2 | 68.2% | 58.7% | |||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | |||||||||
Min | 3.295% | ||||||||||||||||||||
Max | 4.850% | ||||||||||||||||||||
Average | 4.083% |
C-2 |
Distribution of Cut-off Date Loan-to-Value Ratios(1)
Range of Cut-off Date | Number of Mortgage | Cut-off Date | % of Initial Pool | Average Cut-off | Weighted Average Debt Service Coverage | Weighted Average Mortgage | Weighted Average Remaining Terms to | Weighted Average Cut-off | Weighted Average Maturity | ||||||||||||
Loan-to-Value Ratios (%) | Loans | Balance | Balance | Date Balance | Ratio | Interest Rate | Maturity (Mos) | Date LTV | Date / ARD LTV | ||||||||||||
30.3 - 49.9 | 5 | $ | 145,186,917 | 20.1 | % | $ | 29,037,383 | 4.61x | 3.490% | 118.3 | 34.3% | 33.7% | |||||||||
50.0 - 54.9 | 1 | 3,789,761 | 0.5 | $ | 3,789,761 | 1.74x | 4.150% | 118.0 | 52.6% | 42.2% | |||||||||||
55.0 - 59.9 | 8 | 53,952,446 | 7.5 | $ | 6,744,056 | 1.57x | 4.247% | 116.8 | 57.6% | 48.9% | |||||||||||
60.0 - 64.9 | 10 | 178,803,023 | 24.7 | $ | 17,880,302 | 2.08x | 4.102% | 117.7 | 63.7% | 55.5% | |||||||||||
65.0 - 69.9 | 11 | 159,849,842 | 22.1 | $ | 14,531,804 | 1.54x | 4.345% | 118.6 | 68.2% | 57.2% | |||||||||||
70.0 - 74.9 | 11 | 132,398,522 | 18.3 | $ | 12,036,229 | 1.55x | 4.253% | 118.4 | 72.7% | 61.9% | |||||||||||
75.0 - 75.9 | 4 | 49,343,360 | 6.8 | $ | 12,335,840 | 1.45x | 4.272% | 119.0 | 75.4% | 63.6% | |||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | $14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | |||||||||
(1) Unless otherwise indicated, the Cut-off Date LTV Ratio is calculated utilizing the “as-is” appraised value. With respect to 3 mortgage loans, representing approximately 3.0% of the aggregate principal balance of the pool of mortgage loans as of the cut-off date, the respective Cut-off Date LTV Ratio was calculated using either (i) an “as-is” appraised value plus related property improvement plan costs which were reserved for at origination, or (ii) the cut-off date principal balance of a mortgage loan less a reserve taken at origination. The weighted average Cut-off Date LTV Ratio for the mortgage pool without making any of the adjustments described above is 61.2%. | |||||||||||||||||||||
Min | 30.3% | ||||||||||||||||||||
Max | 75.9% | ||||||||||||||||||||
Average | 60.7% |
Distribution of Maturity Date / ARD Loan-to-Value Ratios(1)
Range of Maturity Date / ARD | Number of Mortgage | Cut-off Date | % of Initial Pool | Average Cut-off | Weighted Average Debt Service Coverage | Weighted Average Mortgage | Weighted Average Remaining Terms to | Weighted Average Cut-off | Weighted Average Maturity | ||||||||||||
Loan-to-Value Ratios (%) | Loans | Balance | Balance | Date Balance | Ratio | Interest Rate | Maturity (Mos) | Date LTV | Date / ARD LTV | ||||||||||||
26.9 - 39.9 | 3 | $ | 114,224,221 | 15.8 | % | $ | 38,074,740 | 5.04x | 3.410% | 118.1 | 32.2% | 30.4% | |||||||||
40.0 - 44.9 | 8 | 50,021,017 | 6.9 | $ | 6,252,627 | 2.04x | 4.137% | 118.7 | 54.4% | 43.2% | |||||||||||
45.0 - 49.9 | 4 | 35,639,060 | 4.9 | $ | 8,909,765 | 2.36x | 4.145% | 118.8 | 53.8% | 46.9% | |||||||||||
50.0 - 54.9 | 12 | 160,334,033 | 22.2 | $ | 13,361,169 | 1.80x | 4.273% | 117.8 | 64.2% | 52.6% | |||||||||||
55.0 - 59.9 | 11 | 121,047,179 | 16.7 | $ | 11,004,289 | 1.57x | 4.230% | 118.1 | 70.0% | 57.0% | |||||||||||
60.0 - 64.9 | 8 | 164,328,360 | 22.7 | $ | 20,541,045 | 1.78x | 4.172% | 118.0 | 68.1% | 62.3% | |||||||||||
65.0 - 68.6 | 4 | 77,730,000 | 10.7 | $ | 19,432,500 | 1.56x | 4.200% | 119.0 | 72.7% | 67.0% | |||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | |||||||||
(1) Maturity Date / ARD Loan-to-Value Ratio is calculated on the basis of the “as stabilized” appraised value for 14 mortgage loans. | |||||||||||||||||||||
Min | 26.9% | ||||||||||||||||||||
Max | 68.6% | ||||||||||||||||||||
Average | 52.7% |
C-3 |
Distribution of Original Terms to Maturity / ARD
Original Term to | Number of Mortgage | Cut-off Date | % of Initial Pool | Average Cut-off | Weighted Average Debt Service Coverage | Weighted Average Mortgage | Weighted Average Remaining Terms to | Weighted Average Cut-off | Weighted Average Maturity | ||||||||||||
Maturity / ARD (Mos) | Loans | Balance | Balance | Date Balance | Ratio | Interest Rate | Maturity (Mos) | Date LTV | Date / ARD LTV | ||||||||||||
84 | 1 | $ | 2,608,650 | 0.4 | % | $ | 2,608,650 | 1.88x | 4.670% | 82.0 | 58.8% | 51.8% | |||||||||
120 | 49 | 720,715,219 | 99.6 | $ | 14,708,474 | 2.29x | 4.081% | 118.3 | 60.7% | 52.7% | |||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | |||||||||
Min | 84 | months | |||||||||||||||||||
Max | 120 | months | |||||||||||||||||||
Average | 120 | months |
Distribution of Remaining Term to Maturity / ARD
Range of Remaining Term to Maturity / ARD | Number of Mortgage | Cut-off Date | % of Initial Pool | Average Cut-off | Weighted Average Debt Service Coverage | Weighted Average Mortgage | Weighted Average Remaining Terms to | Weighted Average Cut-off | Weighted Average Maturity | ||||||||||||
(Mos) | Loans | Balance | Balance | Date Balance | Ratio | Interest Rate | Maturity (Mos) | Date LTV | Date / ARD LTV | ||||||||||||
82 | 1 | $ | 2,608,650 | 0.4 | % | $ | 2,608,650 | 1.88x | 4.670% | 82.0 | 58.8% | 51.8% | |||||||||
115 - 119 | 49 | 720,715,219 | 99.6 | $ | 14,708,474 | 2.29x | 4.081% | 118.3 | 60.7% | 52.7% | |||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | |||||||||
Min | 82 | months | |||||||||||||||||||
Max | 119 | months | |||||||||||||||||||
Average | 118 | months |
Distribution of Original Amortization Terms
Original Amortization | Number of Mortgage | Cut-off Date | % of Initial Pool | Average Cut-off | Weighted Average Debt Service Coverage | Weighted Average Mortgage | Weighted Average Remaining Terms to | Weighted Average Cut-off | Weighted Average Maturity | ||||||||||||
Terms (Mos) | Loans | Balance | Balance | Date Balance | Ratio | Interest Rate | Maturity (Mos) | Date LTV | Date / ARD LTV | ||||||||||||
Interest Only | 5 | $ | 208,355,000 | 28.8 | % | $ | 41,671,000 | 3.85x | 3.620% | 117.8 | 44.8% | 44.4% | |||||||||
240 | 1 | 4,288,794 | 0.6 | $ | 4,288,794 | 1.18x | 4.400% | 119.0 | 72.7% | 44.8% | |||||||||||
300 | 2 | 6,787,726 | 0.9 | $ | 3,393,863 | 1.82x | 4.515% | 119.0 | 63.2% | 45.2% | |||||||||||
360 | 42 | 503,892,349 | 69.7 | $ | 11,997,437 | 1.66x | 4.266% | 118.3 | 67.2% | 56.2% | |||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | |||||||||
Min | 240 | months | |||||||||||||||||||
Max | 360 | months | |||||||||||||||||||
Average | 358 | months |
C-4 |
Distribution of Remaining Amortization Terms
Range of Remaining Amortization Terms | Number of Mortgage | Cut-off Date | % of Initial Pool | Average Cut-off | Weighted Average Debt Service Coverage | Weighted Average Mortgage | Weighted Average Remaining Terms to | Weighted Average Cut-off | Weighted Average Maturity | ||||||||||||
(Mos) | Loans | Balance | Balance | Date Balance | Ratio | Interest Rate | Maturity (Mos) | Date LTV | Date / ARD LTV | ||||||||||||
Interest Only | 5 | $ | 208,355,000 | 28.8 | % | $ | 41,671,000 | 3.85x | 3.620% | 117.8 | 44.8% | 44.4% | |||||||||
239 | 1 | 4,288,794 | 0.6 | $ | 4,288,794 | 1.18x | 4.400% | 119.0 | 72.7% | 44.8% | |||||||||||
299 | 2 | 6,787,726 | 0.9 | $ | 3,393,863 | 1.82x | 4.515% | 119.0 | 63.2% | 45.2% | |||||||||||
355 - 360 | 42 | 503,892,349 | 69.7 | $ | 11,997,437 | 1.66x | 4.266% | 118.3 | 67.2% | 56.2% | |||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | |||||||||
Min | 239 | months | |||||||||||||||||||
Max | 360 | months | |||||||||||||||||||
Average | 357 | months |
Mortgage Loans with Original Partial Interest Only Period
Original Partial Interest | Number of Mortgage | Cut-off Date | % of Initial Pool | Average Cut-off | Weighted Average Debt Service Coverage | Weighted Average Mortgage | Weighted Average Remaining Terms to | Weighted Average Cut-off | Weighted Average Maturity | ||||||||||||
Only Period (Mos) | Loans | Balance | Balance | Date Balance | Ratio | Interest Rate | Maturity (Mos) | Date LTV | Date / ARD LTV | ||||||||||||
12 | 4 | $ | 29,550,000 | 4.1 | % | $ | 7,387,500 | 1.56x | 4.339% | 118.5 | 70.1% | 53.5% | |||||||||
24 | 11 | $ | 96,803,360 | 13.4 | % | $ | 8,800,305 | 1.48x | 4.420% | 118.8 | 69.9% | 59.6% | |||||||||
36 | 5 | $ | 54,075,000 | 7.5 | % | $ | 10,815,000 | 1.61x | 4.339% | 119.0 | 69.9% | 59.7% | |||||||||
60 | 5 | $ | 71,800,000 | 9.9 | % | $ | 14,360,000 | 1.50x | 4.281% | 118.9 | 65.5% | 59.7% | |||||||||
72 | 1 | $ | 42,000,000 | 5.8 | % | $ | 42,000,000 | 1.62x | 4.130% | 119.0 | 73.9% | 68.6% |
Distribution of Prepayment Provisions
Number of Mortgage | Cut-off Date | % of Initial Pool | Average Cut-off | Weighted Average Debt Service Coverage | Weighted Average Mortgage | Weighted Average Remaining Terms to | Weighted Average Cut-off | Weighted Average Maturity | |||||||||||||
Prepayment Provision | Loans | Balance | Balance | Date Balance | Ratio | Interest Rate | Maturity (Mos) | Date LTV | Date / ARD LTV | ||||||||||||
Defeasance | 44 | $ | 624,554,647 | 86.3 | % | $ | 14,194,424 | 2.36x | 4.072% | 118.2 | 60.0% | 51.6% | |||||||||
Yield Maintenance | 6 | 98,769,223 | 13.7 | $ | 16,461,537 | 1.85x | 4.152% | 117.9 | 65.6% | 59.0% | |||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% |
C-5 |
Distribution of Debt Yields on Underwritten Net Operating Income | ||||||||||||||||||||||
Range of Debt Yields on Underwritten Net Operating Income (%) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | Average Cut-off Date Balance | Weighted Average Debt Service Coverage Ratio | Weighted Average Mortgage Interest Rate | Weighted Average Remaining Terms to Maturity (Mos) | Weighted Average Cut-off Date LTV | Weighted Average Maturity Date / ARD LTV | |||||||||||||
7.1 - 7.9 | 2 | $ | 20,248,360 | 2.8 | % | $ | 10,124,180 | 1.34x | 4.349% | 119.0 | 72.6% | 64.3% | ||||||||||
8.0 - 8.9 | 9 | 104,890,141 | 14.5 | $ | 11,654,460 | 1.38x | 4.300% | 118.5 | 67.9% | 57.7% | ||||||||||||
9.0 - 9.9 | 13 | 218,937,520 | 30.3 | $ | 16,841,348 | 1.77x | 4.113% | 118.1 | 67.7% | 61.1% | ||||||||||||
10.0 - 10.9 | 6 | 82,514,761 | 11.4 | $ | 13,752,460 | 1.63x | 4.330% | 119.0 | 69.5% | 58.5% | ||||||||||||
11.0 - 11.9 | 7 | 54,812,662 | 7.6 | $ | 7,830,380 | 2.15x | 4.161% | 118.8 | 55.6% | 48.4% | ||||||||||||
12.0 - 12.9 | 5 | 31,432,665 | 4.3 | $ | 6,286,533 | 2.11x | 4.311% | 115.7 | 60.2% | 47.9% | ||||||||||||
13.0 - 13.9 | 3 | 87,869,862 | 12.1 | $ | 29,289,954 | 2.06x | 4.199% | 117.6 | 65.2% | 51.6% | ||||||||||||
14.0 - 19.5 | 5 | 122,617,899 | 17.0 | $ | 24,523,580 | 4.86x | 3.458% | 118.1 | 33.7% | 31.3% | ||||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | ||||||||||
Min | 7.1% | |||||||||||||||||||||
Max | 19.5% | |||||||||||||||||||||
Average | 11.7% | |||||||||||||||||||||
Distribution of Debt Yields on Underwritten Net Cash Flow | ||||||||||||||||||||||
Range of Debt Yields on Underwritten Net Cash Flow (%) | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | Average Cut-off Date Balance | Weighted Average Debt Service Coverage Ratio | Weighted Average Mortgage Interest Rate | Weighted Average Remaining Terms to Maturity (Mos) | Weighted Average Cut-off Date LTV | Weighted Average Maturity Date / ARD LTV | |||||||||||||
7.0 - 7.9 | 4 | $ | 37,248,360 | 5.1 | % | $ | 9,312,090 | 1.33x | 4.285% | 118.8 | 66.3% | 60.0% | ||||||||||
8.0 - 8.9 | 13 | 235,709,378 | 32.6 | $ | 18,131,491 | 1.68x | 4.160% | 118.0 | 67.3% | 59.2% | ||||||||||||
9.0 - 9.9 | 13 | 129,536,924 | 17.9 | $ | 9,964,379 | 1.59x | 4.269% | 118.9 | 71.0% | 60.8% | ||||||||||||
10.0 - 10.9 | 9 | 86,229,654 | 11.9 | $ | 9,581,073 | 1.70x | 4.387% | 118.2 | 66.3% | 53.7% | ||||||||||||
11.0 - 11.9 | 4 | 31,177,677 | 4.3 | $ | 7,794,419 | 2.52x | 4.124% | 115.8 | 50.5% | 47.5% | ||||||||||||
12.0 - 13.9 | 3 | 86,041,282 | 11.9 | $ | 28,680,427 | 2.22x | 4.116% | 118.1 | 61.8% | 49.5% | ||||||||||||
14.0 - 14.9 | 2 | 12,380,595 | 1.7 | $ | 6,190,297 | 2.48x | 4.049% | 119.0 | 42.2% | 31.6% | ||||||||||||
15.0 - 18.1 | 2 | 105,000,000 | 14.5 | $ | 52,500,000 | 5.29x | 3.327% | 118.0 | 31.1% | 30.9% | ||||||||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % | $ | 14,466,477 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% | ||||||||||
Min | 7.0% | |||||||||||||||||||||
Max | 18.1% | |||||||||||||||||||||
Average | 10.9% |
C-6 |
Distribution of Lockbox Types | |||||||||
Lockbox Type | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | ||||||
Springing | 29 | $ | 385,349,375 | 53.3 | % | ||||
Hard | 18 | 311,274,495 | 43.0 | ||||||
None | 2 | 16,600,000 | 2.3 | ||||||
Soft Springing | 1 | 10,100,000 | 1.4 | ||||||
Total/Avg./Wtd.Avg. | 50 | $ | 723,323,870 | 100.0 | % |
Distribution of Escrows | |||||||||
Escrow Type | Number of Mortgage Loans | Cut-off Date Balance | % of Initial Pool Balance | ||||||
Real Estate Tax | 44 | $ | 676,317,998 | 93.5 | % | ||||
Replacement Reserves(1) | 41 | $ | 650,147,126 | 89.9 | % | ||||
TI/LC(2) | 21 | $ | 470,508,186 | 85.0 | % | ||||
Insurance | 37 | $ | 433,106,792 | 59.9 | % |
(1) Includes mortgage loans with FF&E reserves.
(2) Percentage of total office, mixed use, retail and industrial properties and one self storage property with office tenants only.
C-7 |
Distribution of Property Types | |||||||||||||||||||||||
Property Type / Detail | Number of Mortgaged Properties | Cut-off Date Balance(1) | % of Initial Pool Balance | Average Cut-off Date Balance | Weighted Average Debt Service Coverage Ratio(2) | Weighted Average Mortgage Interest Rate(2) | Weighted Average Remaining Terms to Maturity (Mos)(2) | Weighted Average Cut-off Date LTV(2) | Weighted Average Maturity Date / ARD LTV(2) | ||||||||||||||
Office | 18 | $ | 278,990,650 | 38.6 | % | $ | 15,499,481 | 3.18x | 3.775% | 118.0 | 53.4% | 49.0% | |||||||||||
CBD | 12 | 222,986,917 | 30.8 | $ | 18,582,243 | 3.56x | 3.677% | 117.9 | 49.3% | 47.7% | |||||||||||||
Medical | 1 | 29,929,067 | 4.1 | $ | 29,929,067 | 1.64x | 3.935% | 118.0 | 69.6% | 55.1% | |||||||||||||
General Suburban | 5 | 26,074,666 | 3.6 | $ | 5,214,933 | 1.71x | 4.437% | 118.6 | 70.0% | 52.6% | |||||||||||||
Mixed Use | 6 | $ | 139,586,628 | 19.3 | % | $ | 23,264,438 | 1.87x | 4.176% | 118.5 | 67.8% | 56.4% | |||||||||||
Merchandise Mart/Retail | 1 | 71,803,978 | 9.9 | $ | 71,803,978 | 2.13x | 4.098% | 118.0 | 64.1% | 51.2% | |||||||||||||
Retail/Office | 2 | 45,400,000 | 6.3 | $ | 22,700,000 | 1.55x | 4.193% | 119.0 | 73.7% | 64.2% | |||||||||||||
Office/Flex | 2 | 18,487,638 | 2.6 | $ | 9,243,819 | 1.67x | 4.340% | 119.0 | 69.5% | 59.0% | |||||||||||||
Retail/Office/Flex | 1 | 3,895,012 | 0.5 | $ | 3,895,012 | 1.88x | 4.660% | 119.0 | 59.5% | 48.4% | |||||||||||||
Retail | 16 | $ | 120,923,697 | 16.7 | % | $ | 7,557,731 | 1.71x | 4.308% | 118.7 | 63.5% | 53.9% | |||||||||||
Anchored | 7 | 75,618,397 | 10.5 | $ | 10,802,628 | 1.88x | 4.285% | 118.6 | 60.2% | 51.4% | |||||||||||||
Single Tenant Retail | 7 | 32,845,299 | 4.5 | $ | 4,692,186 | 1.37x | 4.340% | 118.7 | 69.7% | 58.0% | |||||||||||||
Shadow Anchored | 1 | 6,625,000 | 0.9 | $ | 6,625,000 | 1.56x | 4.250% | 119.0 | 62.2% | 54.1% | |||||||||||||
Unanchored | 1 | 5,835,000 | 0.8 | $ | 5,835,000 | 1.65x | 4.490% | 119.0 | 72.8% | 62.2% | |||||||||||||
Multifamily | 12 | $ | 90,362,331 | 12.5 | % | $ | 7,530,194 | 1.41x | 4.328% | 118.7 | 67.1% | 59.0% | |||||||||||
Garden | 10 | 77,762,331 | 10.8 | $ | 7,776,233 | 1.41x | 4.344% | 118.8 | 66.4% | 58.9% | |||||||||||||
Student Housing | 2 | 12,600,000 | 1.7 | $ | 6,300,000 | 1.41x | 4.235% | 118.3 | 71.6% | 59.6% | |||||||||||||
Self Storage | 15 | $ | 55,696,014 | 7.7 | % | $ | 3,713,068 | 1.86x | 4.291% | 116.7 | 59.6% | 50.1% | |||||||||||
Hospitality | 3 | $ | 26,764,550 | 3.7 | % | $ | 8,921,517 | 1.77x | 4.506% | 117.2 | 69.7% | 51.7% | |||||||||||
Full Service | 2 | 23,370,872 | 3.2 | $ | 11,685,436 | 1.71x | 4.535% | 116.9 | 70.5% | 52.8% | |||||||||||||
Limited Service | 1 | 3,393,678 | 0.5 | $ | 3,393,678 | 2.17x | 4.310% | 119.0 | 64.1% | 44.2% | |||||||||||||
Industrial | 6 | $ | 11,000,000 | 1.5 | % | $ | 1,833,333 | 2.05x | 4.133% | 119.0 | 56.4% | 49.2% | |||||||||||
Flex | 1 | 6,000,000 | 0.8 | $ | 6,000,000 | 1.52x | 4.280% | 119.0 | 63.8% | 54.2% | |||||||||||||
Warehouse/Distribution | 5 | 5,000,000 | 0.7 | $ | 1,000,000 | 2.68x | 3.957% | 119.0 | 47.6% | 43.1% | |||||||||||||
Total / Wtd Avg | 76 | $ | 723,323,870 | 100.0 | % | $ | 9,517,419 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% |
(1) Calculated based on the mortgaged property’s allocated loan amount for the mortgage loans secured by more than one mortgaged property.
(2) Weighted average based on the mortgaged property’s allocated loan amount for mortgage loans secured by more than one mortgaged property.
C-8 |
Geographic Distribution | ||||||||||||||||||||||
Property Location | Number of Mortgaged Properties | Cut-off Date Balance(1) | % of Initial Pool Balance | Average Cut-off Date Balance | Weighted Average Debt Service Coverage Ratio(2) | Weighted Average Mortgage Interest Rate(2) | Weighted Average Remaining Terms to Maturity (Mos)(2) | Weighted Average Cut-off Date LTV(2) | Weighted Average Maturity Date / ARD LTV(2) | |||||||||||||
Texas | 6 | $ | 116,123,990 | 16.1% | $ | 19,353,998 | 1.94x | 4.147% | 118.3 | 66.8% | 54.6% | |||||||||||
California | 9 | 102,000,000 | 14.1 | $ | 11,333,333 | 1.87x | 4.176% | 118.9 | 65.6% | 60.9% | ||||||||||||
Illinois | 1 | 100,000,000 | 13.8 | $ | 100,000,000 | 5.42x | 3.295% | 118.0 | 30.3% | 30.3% | ||||||||||||
Washington | 9 | 72,000,000 | 9.95 | $ | 8,000,000 | 2.22x | 3.909% | 117.0 | 63.4% | 62.3% | ||||||||||||
Oklahoma | 4 | 51,322,427 | 7.1 | $ | 12,830,607 | 1.45x | 4.122% | 118.3 | 69.7% | 57.8% | ||||||||||||
Florida | 6 | 41,969,352 | 5.8 | $ | 6,994,892 | 1.73x | 4.376% | 119.0 | 58.3% | 46.4% | ||||||||||||
Ohio | 6 | 38,124,015 | 5.3 | $ | 6,354,002 | 1.67x | 4.370% | 118.8 | 69.7% | 56.9% | ||||||||||||
New Jersey | 4 | 35,375,000 | 4.9 | $ | 8,843,750 | 1.43x | 4.476% | 119.0 | 66.5% | 60.0% | ||||||||||||
New York | 8 | 22,242,809 | 3.1 | $ | 2,780,351 | 1.44x | 4.399% | 118.0 | 66.3% | 53.6% | ||||||||||||
Michigan | 4 | 19,395,955 | 2.7 | $ | 4,848,989 | 1.65x | 4.518% | 113.8 | 70.0% | 55.4% | ||||||||||||
Maryland | 1 | 14,160,573 | 2.0 | $ | 14,160,573 | 1.48x | 3.997% | 118.0 | 71.9% | 57.3% | ||||||||||||
Alaska | 2 | 12,464,974 | 1.7 | $ | 6,232,487 | 1.88x | 3.950% | 118.0 | 55.2% | 43.9% | ||||||||||||
Pennsylvania | 3 | 12,183,452 | 1.7 | $ | 4,061,151 | 1.48x | 4.337% | 119.0 | 64.4% | 48.1% | ||||||||||||
Minnesota | 1 | 12,170,872 | 1.7 | $ | 12,170,872 | 1.72x | 4.650% | 115.0 | 73.3% | 55.1% | ||||||||||||
Nebraska | 1 | 11,200,000 | 1.5 | $ | 11,200,000 | 1.70x | 4.410% | 119.0 | 67.5% | 50.2% | ||||||||||||
Oregon | 1 | 10,700,000 | 1.5 | $ | 10,700,000 | 1.36x | 4.154% | 119.0 | 59.8% | 54.4% | ||||||||||||
Hawaii | 1 | 9,000,000 | 1.2 | $ | 9,000,000 | 3.12x | 3.930% | 119.0 | 42.1% | 42.1% | ||||||||||||
Louisiana | 1 | 9,000,000 | 1.2 | $ | 9,000,000 | 1.38x | 4.173% | 118.0 | 72.6% | 59.8% | ||||||||||||
Nevada | 1 | 5,900,000 | 0.8 | $ | 5,900,000 | 1.46x | 4.191% | 118.0 | 59.0% | 53.7% | ||||||||||||
Kansas | 1 | 5,835,000 | 0.8 | $ | 5,835,000 | 1.65x | 4.490% | 119.0 | 72.8% | 62.2% | ||||||||||||
Rhode Island | 1 | 5,155,000 | 0.7 | $ | 5,155,000 | 1.85x | 4.140% | 119.0 | 65.3% | 65.3% | ||||||||||||
North Carolina | 1 | 4,518,384 | 0.6 | $ | 4,518,384 | 1.33x | 4.400% | 118.0 | 68.5% | 55.3% | ||||||||||||
Iowa | 1 | 3,600,000 | 0.5 | $ | 3,600,000 | 1.49x | 4.390% | 119.0 | 69.2% | 59.0% | ||||||||||||
South Carolina | 1 | 3,394,048 | 0.5 | $ | 3,394,048 | 1.48x | 4.720% | 119.0 | 62.3% | 46.2% | ||||||||||||
Colorado | 1 | 3,393,678 | 0.5 | $ | 3,393,678 | 2.17x | 4.310% | 119.0 | 64.1% | 44.2% | ||||||||||||
Connecticut | 1 | 2,094,341 | 0.3 | $ | 2,094,341 | 1.74x | 4.150% | 118.0 | 52.6% | 42.2% | ||||||||||||
Total | 76 | $ | 723,323,870 | 100.0% | $ | 9,517,419 | 2.29x | 4.083% | 118.2 | 60.7% | 52.7% |
(1) Calculated based on the mortgaged property’s allocated loan amount for the mortgage loans secured by more than one mortgaged property.
(2) Weighted average based on the mortgaged property’s allocated loan amount for mortgage loans secured by more than one mortgaged property.
C-9 |
(THIS PAGE INTENTIONALLY LEFT BLANK)
ANNEX D
FORM OF DISTRIBUTION DATE STATEMENT
(THIS PAGE INTENTIONALLY LEFT BLANK)
Distribution Date: Determination Date: | Citigroup Commercial Mortgage Trust 2015-GC31 Commercial Mortgage Pass-Through Certificates Series 2015-GC31 |
CONTACT INFORMATION | CONTENTS | ||||||
Depositor | Citigroup Commercial Mortgage Securities Inc. | Distribution Summary | 2 | ||||
Distribution Summary (Factors) | 3 | ||||||
Interest Distribution Detail | 4 | ||||||
Master Servicer | Wells Fargo Bank, National Association | Principal Distribution Detail | 5 | ||||
Reconciliation Detail | 6 | ||||||
Stratification Detail | 7 | ||||||
Operating Advisor | Pentalpha Surveillance LLC | ||||||
Mortgage Loan Detail | 11 | ||||||
NOI Detail | 12 | ||||||
Delinquency Loan Detail | 13 | ||||||
Trustee / Custodian | Deutsche Bank Trust Company Americas | ||||||
Appraisal Reduction Detail | 15 | ||||||
Loan Modification Detail | 17 | ||||||
Specially Serviced Loan Detail | 19 | ||||||
Special Servicer | Torchlight Loan Services, LLC | ||||||
Unscheduled Principal Detail | 21 | ||||||
Liquidated Loan Detail | 23 | ||||||
Deal Contact: | John Hannon | Citibank, N.A. | ||
john.hannon@citi.com | Agency and Trust | |||
Tel: (212) 816-5693 | 388 Greenwich Street, 14th Floor | |||
Fax: (212) 816-5527 | New York, NY 10013 | |||
Reports Available atwww.sf.citidirect.com | D-1 | © Copyright 2015 Citigroup |
Distribution Date: Determination Date: | Citigroup Commercial Mortgage Trust 2015-GC31 Commercial Mortgage Pass-Through Certificates Series 2015-GC31 |
Distribution Summary
DISTRIBUTION IN DOLLARS | ||||||||||||||
Prior | Pass- | Accrual | Yield | Prepayment | Current | |||||||||
Original | Principal | Through | Day Count | Accrual | Interest | Principal | Maintenance | Penalties | Total | Deferred | Realized | Principal | ||
Class | Balance | Balance | Rate | Fraction | Dates | Distributed | Distributed | Distributed | Distributed | Distributed | Interest | Loss | Balance | |
(1) | (2) | (3) | (4) | (5) | (6) | (7) | (8) | (9) | (10) | (11)=(7+8+9+10) | (12) | (13) | (14)=(3-8+12-13) | |
Totals | ||||||||||||||
Notional Classes | ||||||||||||||
Totals | ||||||||||||||
Reports Available atwww.sf.citidirect.com | D-2 | © Copyright 2015 Citigroup |
Distribution Date: Determination Date: | Citigroup Commercial Mortgage Trust 2015-GC31 Commercial Mortgage Pass-Through Certificates Series 2015-GC31 |
PER $1,000 OF ORIGINAL BALANCE | |||||||||||
Class | CUSIP | Record Date | Prior Principal Balance (3/2 x 1000) | Interest Distributed (7/2 x 1000) | Principal Distributed (8/2 x 1000) | Yield Maintenance Distributed (9)/(2) x 1000 | Prepayment Penalties Distributed (10)/(2) x 1000 | Total Distributed (11/2 x 1000) | Deferred Interest (12/2 x 1000) | Realized Loss (13/2 x 1000) | Current Principal Balance (142 x 1000) |
Reports Available atwww.sf.citidirect.com | D-3 | © Copyright 2015 Citigroup |
Distribution Date: Determination Date: | Citigroup Commercial Mortgage Trust 2015-GC31 Commercial Mortgage Pass-Through Certificates Series 2015-GC31 |
Interest Distribution Detail
DISTRIBUTION IN DOLLARS | ||||||||||||
Prior | Pass- | Next Pass- | Accrual | Optimal | Prior | Interest on | Non-Recov. | Current | ||||
Principal | Through | Through | Day Count | Accrued | Unpaid | Prior Unpaid | Interest | Interest | Deferred | Interest | Unpaid | |
Class | Balance | Rate | Rate | Fraction | Interest | Interest | Interest | Shortfall | Due | Interest | Distributed | Interest |
(1) | (2) | (3) | (4) | (5) | (6) | (7) | (8) | (9) | (10)=(6)+(7)+(8)-(9) | (11) | (12) | (13)=(10)-(11)-(12) |
Totals | ||||||||||||
Notional Classes | ||||||||||||
Totals |
Reports Available atwww.sf.citidirect.com | D-4 | © Copyright 2015 Citigroup |
Distribution Date: Determination Date: | Citigroup Commercial Mortgage Trust 2015-GC31 Commercial Mortgage Pass-Through Certificates Series 2015-GC31 |
Principal Distribution Detail
DISTRIBUTION IN DOLLARS | |||||||||||||
Prior | Scheduled | Unscheduled | Current | Current | Current | Cumulative | Original | Current | Original | Current | |||
Original | Principal | Principal | Principal | Accreted | Realized | Principal | Principal | Realized | Class | Class | Credit | Credit | |
Class | Balance | Balance | Distribution | Distribution | Principal | Loss | Recoveries | Balance | Loss | (%) | (%) | Support | Support |
(1) | (2) | (3) | (4) | (5) | (6) | (7) | (8) | (9)=(3)-(4)-(5)+(6)-(7)+(8) | (10) | (11) | (12) | (13) | (14) |
Reports Available atwww.sf.citidirect.com | D-5 | © Copyright 2015 Citigroup |
Distribution Date: Determination Date: | Citigroup Commercial Mortgage Trust 2015-GC31 Commercial Mortgage Pass-Through Certificates Series 2015-GC31 |
Reconciliation Detail
SOURCE OF FUNDS | ALLOCATION OF FUNDS | ||||||||
Interest Funds Available | Scheduled Fees | ||||||||
Scheduled Interest | Sub-Servicing Fee | ||||||||
Prepayment Interest Shortfall | Master Servicing Fee | ||||||||
Interest Adjustments | Trustee Fee | ||||||||
Realized Loss in Excess of Principal Balance | Operating Advisor Fee | ||||||||
Total Interest Funds Available: | Total Scheduled Fees: | ||||||||
Additional Fees, Expenses, etc. | |||||||||
Principal Funds Available | Special Servicing Fee | ||||||||
Scheduled Principal | Workout Fee | ||||||||
Curtailments | Liquidation Fee | ||||||||
Principal Prepayments | Additional Trust Fund Expenses | ||||||||
Net Liquidation Proceeds | Reimbursement for Interest on Advances | ||||||||
Repurchased Principal | Other Expenses | ||||||||
Substitution Principal | Total Additional Fees, Expenses, etc.: | ||||||||
Other Principal | Distribution to Certificateholders | ||||||||
Total Principal Funds Available: | Interest Distribution | ||||||||
Other Funds Available | Principal Distribution | ||||||||
Yield Maintenance Charges | Yield Maintenance Charges Distribution | ||||||||
Prepayment Premiums | Prepayment Premiums Distribution | ||||||||
Other Charges | Total Distribution to Certificateholders: | ||||||||
Total Other Funds Available: | Total Funds Allocated | ||||||||
Total Funds Available | |||||||||
Reports Available atwww.sf.citidirect.com | D-6 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 | ||
Stratification Detail |
Ending Scheduled Balance | State | |||||||||||||
Ending Scheduled Balance | # of Loans | Ending Scheduled Balance | % of Agg. End. Sched. Bal. | WAC | WART | WA DSCR | State | # of Properties | Ending Scheduled Balance | % of Agg. End. Sched. Bal. | WAC | WART | WA DSCR | |
Totals | Totals | |||||||||||||
Reports Available atwww.sf.citidirect.com | D-7 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 | ||
Stratification Detail |
Seasoning | Property Type | |||||||||||||
Seasoning | # of Loans | Ending Scheduled Balance | % of Agg. End. Sched. Bal. | WAC | WART | WA DSCR | Property Type | # of Properties | Ending Scheduled Balance | % of Agg. End. Sched. Bal. | WAC | WART | WA DSCR | |
Totals | ||||||||||||||
Totals |
Reports Available atwww.sf.citidirect.com | D-8 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 | ||
Stratification Detail |
Debt Service Coverage Ratio | Loan Rate | |||||||||||||
Debt Service Coverage Ratio | # of Loans | Ending Scheduled Balance | % of Agg. End. Sched. Bal. | WAC | WART | WA DSCR | Loan Rate | # of Loans | Ending Scheduled Balance | % of Agg. End. Sched. Bal. | WAC | WART | WA DSCR | |
Totals | ||||||||||||||
Totals | ||||||||||||||
Reports Available atwww.sf.citidirect.com | D-9 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 | ||
Stratification Detail |
Anticipated Remaining Term | Remaining Amortization Term | |||||||||||||
Anticipated Remaining Term | # of Loans | Ending Scheduled Balance | % of Agg. End. Sched. Bal. | WAC | WART | WA DSCR | Remaining Amortization Term | # of Loans | Ending Scheduled Balance | % of Agg. End. Sched. Bal. | WAC | WART | WA DSCR | |
Totals | ||||||||||||||
Totals |
Reports Available atwww.sf.citidirect.com | D-10 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 |
Mortgage Loan Detail | |||||||||||||||||
Loan | OMCR | Property Type | City | State | Interest Payment | Principal Payment | Gross Coupon | Maturity Date | Neg Am Flag | Beginning Scheduled Balance | Ending Scheduled Balance | Paid Through Date | Apprasial Reduction Date | Apprasial Reduction Amount | Payment Status of Loan (1) | Workout Strategy (2) | Mod. Code (3) |
Totals |
Payment Status of Loan (1) | Workout Strategy (2) | Mod. Code (3) | ||||
A. In Grace Period | 3. 90+ Days Delinquent | 1. Modification | 7. REO | 13. Other or TBD | 1. Maturity Date Extension | 7. Capitalization of Taxes |
B. Late, but less than 30 Days | 4. Performing Matured Balloon | 2. Foreclosure | 8. Resolved | 98. Not Provided By Servicer | 2. Amortization Change | 8. Other |
0. Current | 5. Non Performing Matured Balloon | 3. Bankruptcy | 9. Pending Return to Master Servicer | 3. Principal Write-Off | 9. Combination | |
1. 30-59 Days Delinquent | 7. Foreclosure | 4. Extension | 10. Deed In Lieu of Foreclosure | 4. Blank (formerly Combination) | ||
2. 60-89 Days Delinquent | 9. REO | 5. Note Sale | 11. Full Payoff | 5. Temporary Rate Reduction | ||
6. DPO | 12. Reps and Warranties | 6. Capitalization of Interest |
Reports Available atwww.sf.citidirect.com | D-11 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 |
NOI Detail
Loan Number | OMCR | Property Type | City | State | Ending Scheduled Balance | Most Recent Fiscal NOI | Most Recent NOI | Most Recent NOI Start Date | Most Recent NOI End Date |
| |||||||||
Totals |
Reports Available atwww.sf.citidirect.com | D-12 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 | ||
Delinquency Loan Detail |
Actual | Paid | Current P & I | Total P & I | Cumulative | Other Expense | Payment | Workout | Most Recent | ||||||
Loan | # of Months | Principal | Through | Advances (Net | Advances | Accrued Unpaid | Advance | Status of | Strategy | Special Serv | Foreclosure | Bankruptcy | REO | |
Number | OMCR | Delinq | Balance | Date | of ASER) | Outstanding | Advance Interest | Outstanding | Loan (1) | (2) | Transfer Date | Date | Date | Date |
There is no Delinquency Loan Detail for the current distribution period. | ||||||||||||||
Totals |
Payment Status of Loan (1) | Workout Strategy (2) | |||
A. In Grace Period | 3. 90+ Days Delinquent | 1. Modification | 7. REO | 13. Other or TBD |
B. Late, but less than 30 Days | 4. Performing Matured Balloon | 2. Foreclosure | 8. Resolved | 98. Not Provided By Servicer |
0. Current | 5. Non Performing Matured Balloon | 3. Bankruptcy | 9. Pending Return to Master Servicer | |
1. 30-59 Days Delinquent | 7. Foreclosure | 4. Extension | 10. Deed In Lieu of Foreclosure | |
2. 60-89 Days Delinquent | 9. REO | 5. Note Sale | 11. Full Payoff | |
6. DPO | 12. Reps and Warranties |
Reports Available atwww.sf.citidirect.com | D-13 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 | ||
Historical Delinquency Information |
Distribution | Less Than 1 Month | 1 Month | 2 Month | 3+ Month | Bankruptcy | Foreclosure | REO | |||||||
Date | ||||||||||||||
End. Sched. Bal. | # | End. Sched. Bal. | # | End. Sched. Bal. | # | End. Sched. Bal. | # | End. Sched. Bal. | # | End. Sched. Bal. | # | End. Sched. Bal. | # | |
0.00 | 0 | 0.00 | 0 | 0.00 | 0 | 0.00 | 0 | 0.00 | 0 | 0.00 | 0 | 0.00 | 0 | |
0.000% | 0.0% | 0.000% | 0.0% | 0.000% | 0.0% | 0.000% | 0.0% | 0.000% | 0.0% | 0.000% | 0.0% | 0.000% | 0.0% |
Reports Available atwww.sf.citidirect.com | D-14 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 | ||
Appraisal Reduction Detail |
Appraisal | Appraisal | Most Recent | Cumulative | |||
Loan Number | OMCR | Property Name | Reduction Amount | Reduction Date | ASER Amount | ASER Amount |
There is no Appraisal Reduction activity for the current distribution period. | ||||||
Totals |
Reports Available atwww.sf.citidirect.com | D-15 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 | ||
Historical Appraisal Reduction Detail |
Distribution | Appraisal | Appraisal | Most Recent | Cumulative | |||
Date | Loan Number | OMCR | Property Name | Reduction Amount | Reduction Date | ASER Amount | ASER Amount |
There is no historical Appraisal Reduction activity. | |||||||
Totals |
Reports Available atwww.sf.citidirect.com | D-16 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 | ||
Loan Modification Detail |
Modification | Modification | Modification | |||
Loan Number | OMCR | Property Name | Date | Code (1) | Description |
There is no Loan Modification activity for the current distribution period. | |||||
Totals |
Modification Code (1) | |
1. Maturity Date Extension | 7. Capitalization of Taxes |
2. Amortization Change | 8. Other |
3. Principal Write-Off | 9. Combination |
4. Blank (formerly Combination) | |
5. Temporary Rate Reduction | |
6. Capitalization of Interest |
Reports Available atwww.sf.citidirect.com | D-17 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates | |
Series 2015-GC31 | ||
Historical Loan Modification Detail |
Distribution | Modification | Modification | Modification | |||
Date | Loan | OMCR | Property Name | Date | Code (1) | Description |
There is no historical Loan Modification activity. | ||||||
Totals |
Modification Code (1) | |
1. Maturity Date Extension | 7. Capitalization of Taxes |
2. Amortization Change | 8. Other |
3. Principal Write-Off | 9. Combination |
4. Blank (formerly Combination) | |
5. Temporary Rate Reduction | |
6. Capitalization of Interest |
Reports Available atwww.sf.citidirect.com | D-18 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates Series 2015-GC31 Specially Serviced Loan Detail |
Loan | OMCR | Workout Strategy (1) | Most Recent Inspection Date | Most Recent Specially Serviced Transfer Date | Most Recent Appraisal Date | Most Recent Appraisal Value | Other REO Property Value | Comment from Special Servicer | ||||||||
There is no Specially Serviced Loan activity for the current distribution period. | ||||||||||||||||
Totals |
Workout Strategy (1) | |||||
1. Modification | 7. REO | 13. Other or TBD | |||
2. Foreclosure | 8. Resolved | 98. Not Provided By Servicer | |||
3. Bankruptcy | 9. Pending Return to Master Servicer | ||||
4. Extension | 10. Deed In Lieu of Foreclosure | ||||
5. Note Sale | 11. Full Payoff | ||||
6. DPO | 12. Reps and Warranties |
Reports Available atwww.sf.citidirect.com | D-19 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates Series 2015-GC31 Historical Specially Serviced Loan Detail |
Distribution Date | Loan Number | OMCR | Spec. Serviced Transfer Date | Workout Strategy (1) | Spec. Serviced Loan to MS | Scheduled Balance | Actual Balance | Property Type (2) | State | Interest Rate | Note Date | Net Operating Income | Net Operating Income Date | DSC Ratio | DSC Date | Maturity Date | WART | |||||||||||||||||
There is no historical Specially Serviced Loan activity. | ||||||||||||||||||||||||||||||||||
Totals |
Workout Strategy (1) | |||||
1. Modification | 7. REO | 13. Other or TBD | |||
2. Foreclosure | 8. Resolved | 98. Not Provided By Servicer | |||
3. Bankruptcy | 9. Pending Return to Master Servicer | ||||
4. Extension | 10. Deed In Lieu of Foreclosure | ||||
5. Note Sale | 11. Full Payoff | ||||
6. DPO | 12. Reps and Warranties |
Reports Available atwww.sf.citidirect.com | D-20 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates Series 2015-GC31 Unscheduled Principal Detail |
Loan Number | OMCR | Liquidation / Prepayment Date | Liquidation / Prepayment Code | Unscheduled Principal Collections | Unscheduled Principal Adjustments | Other Interest Adjustment | Prepayment Interest Excess (Shortfall) | Prepayment Penalties | Yield Maintenance Charges | |||||||||
Totals | ||||||||||||||||||
Liquidation / Prepayment Code (1) | |||||
1. Partial Liquidation (Curtailment) | 7. Not Used | ||||
2. Payoff Prior To Maturity | 8. Payoff With Penalty | ||||
3. Disposition / Liquidation | 9. Payoff With Yield Maintenance | ||||
4. Repurchase / Substitution | 10. Curtailment With Penalty | ||||
5. Full Payoff At Maturity | 11. Curtailment With Yield | ||||
6. DPO | Maintenance |
Reports Available atwww.sf.citidirect.com | D-21 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates Series 2015-GC31 Historical Unscheduled Principal Detail |
Distribution Date | Loan Number OMCR | Liquidation / Prepayment Date | Liquidation / Prepayment Code | Unscheduled Principal Collections | Unscheduled Principal Adjustments | Other Interest Adjustment | Prepayment Interest Excess (Shortfall) | Prepayment Penality | Yield Maintenance Premium | |||||||||
Totals | ||||||||||||||||||
Liquidation / Prepayment Code (1) | |||||
1. Partial Liquidation (Curtailment) | 7. Not Used | ||||
2. Payoff Prior To Maturity | 8. Payoff With Penalty | ||||
3. Disposition / Liquidation | 9. Payoff With Yield Maintenance | ||||
4. Repurchase / Substitution | 10. Curtailment With Penalty | ||||
5. Full Payoff At Maturity | 11. Curtailment With Yield | ||||
6. DPO | Maintenance |
Reports Available atwww.sf.citidirect.com | D-22 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates Series 2015-GC31 Liquidated Loan Detail |
Loan Number | OMCR | Final Recovery Determ Date | Most Recent Appraisal Date | Most Recent Appraisal Value | Actual Balance | Gross Proceeds | Proceeds as a % of Act Bal | Liquidation Expenses | Net Liquidation Proceeds | Net Proceeds as a % of Act Bal | Realized Loss | Repurchased by Seller (Y/N) | ||||||||||||
There is no Liquidated Loan activity for the current distribution period. | ||||||||||||||||||||||||
Totals |
Reports Available atwww.sf.citidirect.com | D-23 | © Copyright 2015 Citigroup |
Distribution Date: | Citigroup Commercial Mortgage Trust 2015-GC31 | |
Determination Date: | Commercial Mortgage Pass-Through Certificates Series 2015-GC31 Historical Liquidated Loan Detail |
Distribution Date | Loan Number | OMCR | Final Recovery Determ Date | Most Recent Appraisal Date | Most Recent Appraisal Value | Actual Balance | Gross Proceeds | Gross Proceeds as a % of Act Bal | Liquidation Expenses | Net Liquidation Proceeds | Net Proceeds as a % of Act Bal | Realized Loss | Repurchased by Seller (Y/N) | |||||||||||||
There is no historical Liquidated Loan activity. | ||||||||||||||||||||||||||
Totals |
Reports Available atwww.sf.citidirect.com | D-24 | © Copyright 2015 Citigroup |
ANNEX E-1
SPONSOR REPRESENTATIONS AND WARRANTIES
Each Sponsor will make, as of the Cut-off Date or such other date as set forth below, with respect to each Mortgage Loan sold by it that we include in the Issuing Entity, representations and warranties generally to the effect set forth below. The exceptions to the representations and warranties set forth below are identified on Annex E-2 to this prospectus supplement. Capitalized terms used but not otherwise defined in this Annex E-1 will have the meanings set forth in this prospectus supplement or, if not defined in this prospectus supplement, in the related Mortgage Loan Purchase Agreement.
Each Mortgage Loan Purchase Agreement, together with the related representations and warranties, serves to contractually allocate risk between the related Sponsor, on the one hand, and the Issuing Entity, on the other. We present the related representations and warranties set forth below for the sole purpose of describing some of the terms and conditions of that risk allocation. The presentation of representations and warranties below is not intended as statements regarding the actual characteristics of the Mortgage Loans, the Mortgaged Properties or other matters. We cannot assure you that the Mortgage Loans actually conform to the statements made in the representations and warranties that we present below.
(1) | Whole Loan; Ownership of Mortgage Loans. Except with respect to a Mortgage Loan that is part of a Loan Combination, each Mortgage Loan is a whole loan and not a participation interest in a Mortgage Loan. Each Mortgage Loan that is part of a Loan Combination is a senior orpari passu portion of a whole loan evidenced by a senior orpari passu note. At the time of the sale, transfer and assignment to Depositor, no Mortgage Note or Mortgage was subject to any assignment (other than assignments to the Sponsor), participation or pledge, and the Sponsor had good title to, and was the sole owner of, each Mortgage Loan free and clear of any and all liens, charges, pledges, encumbrances, participations, any other ownership interests on, in or to such Mortgage Loan other than any servicing rights appointment or similar agreement, any Outside Servicing Agreement with respect to an Outside Serviced Mortgage Loan and rights of the holder of a related Companion Loan pursuant to a Co-Lender Agreement. The Sponsor has full right and authority to sell, assign and transfer each Mortgage Loan, and the assignment to Depositor constitutes a legal, valid and binding assignment of such Mortgage Loan free and clear of any and all liens, pledges, charges or security interests of any nature encumbering such Mortgage Loan other than the rights of the holder of a related Companion Loan pursuant to a Co-Lender Agreement. |
(2) | Loan Document Status. Each related Mortgage Note, Mortgage, Assignment of Leases (if a separate instrument), guaranty and other agreement executed by or on behalf of the related Mortgagor, guarantor or other obligor in connection with such Mortgage Loan is the legal, valid and binding obligation of the related Mortgagor, guarantor or other obligor (subject to any non-recourse provisions contained in any of the foregoing agreements and any applicable state anti-deficiency or market value limit deficiency legislation), as applicable, and is enforceable in accordance with its terms, except (i) as such enforcement may be limited by (a) bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (b) general principles of equity (regardless of whether such enforcement is considered in a proceeding in equity or at law) and (ii) that certain provisions in such Loan Documents (including, without limitation, provisions requiring the payment of default interest, late fees or prepayment/yield maintenance fees, charges and/or premiums) are, or may be, further limited or rendered unenforceable by or under applicable law, but (subject to the limitations set forth in clause (i) above) such limitations or unenforceability will not render such Loan Documents invalid as a whole or materially interfere with the Mortgagee’s realization of the principal benefits and/or security provided thereby (clauses (i) and (ii) collectively, the “Standard Qualifications”). |
Except as set forth in the immediately preceding sentence, there is no valid offset, defense, counterclaim or right of rescission available to the related Mortgagor with respect to any of the related Mortgage Notes, Mortgages or other Loan Documents, including, without limitation, any such valid offset, defense, counterclaim or right based on intentional fraud by the Sponsor in connection with the origination of the Mortgage Loan, that would deny the Mortgagee the principal benefits intended to be provided by the Mortgage Note, Mortgage or other Loan Documents. |
(3) | Mortgage Provisions. The Loan Documents for each Mortgage Loan contain provisions that render the rights and remedies of the holder thereof adequate for the practical realization against the Mortgaged |
E-1-1 |
Property of the principal benefits of the security intended to be provided thereby, including realization by judicial or, if applicable, nonjudicial foreclosure subject to the limitations set forth in the Standard Qualifications. |
(4) | Mortgage Status; Waivers and Modifications. Since origination and except by written instruments set forth in the related Mortgage File (a) the material terms of such Mortgage, Mortgage Note, Mortgage Loan guaranty, and related Loan Documents have not been waived, impaired, modified, altered, satisfied, canceled, subordinated or rescinded in any respect which materially interferes with the security intended to be provided by such Mortgage; (b) no related Mortgaged Property or any portion thereof has been released from the lien of the related Mortgage in any manner which materially interferes with the security intended to be provided by such Mortgage or the use or operation of the remaining portion of such Mortgaged Property; and (c) neither the related Mortgagor nor the related guarantor has been released from its material obligations under the Mortgage Loan. |
(5) | Lien; Valid Assignment. Subject to the Standard Qualifications, each assignment of Mortgage and assignment of Assignment of Leases to the Issuing Entity constitutes a legal, valid and binding assignment to the Issuing Entity. Each related Mortgage and Assignment of Leases is freely assignable without the consent of the related Mortgagor. Each related Mortgage is a legal, valid and enforceable first lien on the related Mortgagor’s fee (or if identified on the loan schedule attached as an exhibit to the applicable Mortgage Loan Purchase Agreement, leasehold) interest in the Mortgaged Property in the principal amount of such Mortgage Loan or allocated loan amount (subject only to Permitted Encumbrances (as defined below) and the exceptions to paragraph (6) set forth on Annex E-2 (each such exception, a “Title Exception”)), except as the enforcement thereof may be limited by the Standard Qualifications. Such Mortgaged Property (subject to and excepting Permitted Encumbrances and the Title Exceptions) as of origination was, and as of the Cut-off Date, to the Sponsor’s knowledge, is free and clear of any recorded mechanics’ liens, recorded materialmen’s liens and other recorded encumbrances which are prior to or equal with the lien of the related Mortgage, except those which are bonded over, escrowed for or insured against by a lender’s title insurance policy (as described below), and, to the Sponsor’s knowledge and subject to the rights of tenants (as tenants only) (subject to and excepting Permitted Encumbrances and the Title Exceptions), no rights exist which under law could give rise to any such lien or encumbrance that would be prior to or equal with the lien of the related Mortgage, except those which are bonded over, escrowed for or insured against by a lender’s title insurance policy (as described below). Notwithstanding anything herein to the contrary, no representation is made as to the perfection of any security interest in rents or other personal property to the extent that possession or control of such items or actions other than the filing of Uniform Commercial Code financing statements is required in order to effect such perfection. |
(6) | Permitted Liens; Title Insurance. Each Mortgaged Property securing a Mortgage Loan is covered by an American Land Title Association loan title insurance policy or a comparable form of loan title insurance policy approved for use in the applicable jurisdiction (or, if such policy is yet to be issued, by a pro forma policy, a preliminary title policy with escrow instructions or a “marked up” commitment, in each case binding on the title insurer) (the “Title Policy”) in the original principal amount of such Mortgage Loan (or with respect to a Mortgage Loan secured by multiple properties, an amount equal to at least the allocated loan amount with respect to the Title Policy for each such property) after all advances of principal (including any advances held in escrow or reserves), that insures for the benefit of the owner of the indebtedness secured by the Mortgage, the first priority lien of the Mortgage, which lien is subject only to (a) the lien of current real property taxes, water charges, sewer rents and assessments due and payable but not yet delinquent; (b) covenants, conditions and restrictions, rights of way, easements and other matters of public record; (c) the exceptions (general and specific) and exclusions set forth in such Title Policy; (d) other matters to which like properties are commonly subject; (e) the rights of tenants (as tenants only) under leases (including subleases) pertaining to the related Mortgaged Property and condominium declarations; (f) if the related Mortgage Loan constitutes a Cross-Collateralized Mortgage Loan, the lien of the Mortgage for another Mortgage Loan contained in the same Cross-Collateralized Group; and (g) if the related Mortgage Loan is part of a Loan Combination, the rights of the holder(s) of the related Companion Loan(s) pursuant to the related Co-Lender Agreement;provided that none of items (a) through (g), individually or in the aggregate, materially and adversely interferes with the value or current use of the Mortgaged Property or the security intended to be provided by such Mortgage or the Mortgagor’s ability to pay its obligations when they become due (collectively, the “Permitted Encumbrances”). Except as contemplated by clauses (f) and (g) of the preceding sentence, none of the |
E-1-2 |
Permitted Encumbrances are mortgage liens that are senior to or coordinate and co-equal with the lien of the related Mortgage. Such Title Policy (or, if it has yet to be issued, the coverage to be provided thereby) is in full force and effect, all premiums thereon have been paid and no claims have been made by the Sponsor thereunder and no claims have been paid thereunder. Neither the Sponsor, nor to the Sponsor’s knowledge, any other holder of the Mortgage Loan, has done, by act or omission, anything that would materially impair the coverage under such Title Policy. |
(7) | Junior Liens. It being understood that B notes secured by the same Mortgage as a Mortgage Loan are not subordinate mortgages or junior liens, except for any Mortgage Loan that is cross-collateralized and cross-defaulted with another Mortgage Loan, there are no subordinate mortgages or junior liens securing the payment of money encumbering the related Mortgaged Property (other than Permitted Encumbrances and the Title Exceptions, taxes and assessments, mechanics’ and materialmen’s liens (which are the subject of the representation in paragraph (5) above), and equipment and other personal property financing). Except as set forth on an exhibit to the applicable Mortgage Loan Purchase Agreement, the Sponsor has no knowledge of any mezzanine debt secured directly by interests in the related Mortgagor. |
(8) | Assignment of Leases and Rents. There exists as part of the related Mortgage File an Assignment of Leases (either as a separate instrument or incorporated into the related Mortgage). Subject to the Permitted Encumbrances and the Title Exceptions, each related Assignment of Leases creates a valid first-priority collateral assignment of, or a valid first-priority lien or security interest in, rents and certain rights under the related lease or leases, subject only to a license granted to the related Mortgagor to exercise certain rights and to perform certain obligations of the lessor under such lease or leases, including the right to operate the related leased property, except as the enforcement thereof may be limited by the Standard Qualifications. The related Mortgage or related Assignment of Leases, subject to applicable law, provides that, upon an event of default under the Mortgage Loan, a receiver is permitted to be appointed for the collection of rents or for the related Mortgagee to enter into possession to collect the rents or for rents to be paid directly to the Mortgagee. |
(9) | UCC Filings. If the related Mortgaged Property is operated as a hospitality property, the Sponsor has filed and/or recorded or caused to be filed and/or recorded (or, if not filed and/or recorded, submitted in proper form for filing and/or recording), UCC financing statements in the appropriate public filing and/or recording offices necessary at the time of the origination of the Mortgage Loan to perfect a valid security interest in all items of physical personal property reasonably necessary to operate such Mortgaged Property owned by such Mortgagor and located on the related Mortgaged Property (other than any non-material personal property, any personal property subject to a purchase money security interest, a sale and leaseback financing arrangement as permitted under the terms of the related Mortgage Loan documents or any other personal property leases applicable to such personal property), to the extent perfection may be effected pursuant to applicable law by recording or filing, as the case may be. Subject to the Standard Qualifications, each related Mortgage (or equivalent document) creates a valid and enforceable lien and security interest on the items of personalty described above. No representation is made as to the perfection of any security interest in rents or other personal property to the extent that possession or control of such items or actions other than the filing of UCC financing statements are required in order to effect such perfection. |
(10) | Condition of Property. The Sponsor or the originator of the Mortgage Loan inspected or caused to be inspected each related Mortgaged Property within six months of origination of the Mortgage Loan and within thirteen months of the Cut-off Date. |
An engineering report or property condition assessment was prepared in connection with the origination of each Mortgage Loan no more than 13 months prior to the Cut-off Date. To the Sponsor’s knowledge, based solely upon due diligence customarily performed in connection with the origination of comparable mortgage loans, as of the Closing Date, each related Mortgaged Property was free and clear of any material damage (other than deferred maintenance for which escrows were established at origination) that would affect materially and adversely the use or value of such Mortgaged Property as security for the Mortgage Loan. |
(11) | Taxes and Assessments. All taxes, governmental assessments and other outstanding governmental charges (including, without limitation, water and sewage charges), or installments thereof, which could be a lien on the related Mortgaged Property that would be of equal or superior priority to the lien of the |
E-1-3 |
Mortgage and that prior to the Cut-off Date have become delinquent in respect of each related Mortgaged Property have been paid, or an escrow of funds has been established in an amount sufficient to cover such payments and reasonably estimated interest and penalties, if any, thereon. For purposes of this representation and warranty, real estate taxes and governmental assessments and other outstanding governmental charges and installments thereof shall not be considered delinquent until the earlier of (a) the date on which interest and/or penalties would first be payable thereon and (b) the date on which enforcement action is entitled to be taken by the related taxing authority. |
(12) | Condemnation. As of the date of origination and to the Sponsor’s knowledge as of the Cut-off Date, there is no proceeding pending, and, to the Sponsor’s knowledge as of the date of origination and as of the Cut-off Date, there is no proceeding threatened, for the total or partial condemnation of such Mortgaged Property that would have a material adverse effect on the value, use or operation of the Mortgaged Property. |
(13) | Actions Concerning Mortgage Loan. As of the date of origination and to the Sponsor’s knowledge as of the Cut-off Date, there was no pending or filed action, suit or proceeding, arbitration or governmental investigation involving any Mortgagor, guarantor, or Mortgagor’s interest in the Mortgaged Property, an adverse outcome of which would reasonably be expected to materially and adversely affect (a) such Mortgagor’s title to the Mortgaged Property, (b) the validity or enforceability of the Mortgage, (c) such Mortgagor’s ability to perform under the related Mortgage Loan, (d) such guarantor’s ability to perform under the related guaranty, (e) the principal benefit of the security intended to be provided by the Mortgage Loan documents or (f) the current principal use of the Mortgaged Property. |
(14) | Escrow Deposits. All escrow deposits and payments required to be escrowed with Mortgagee pursuant to each Mortgage Loan are in the possession, or under the control, of the Sponsor or its servicer, and there are no deficiencies (subject to any applicable grace or cure periods) in connection therewith, and all such escrows and deposits (or the right thereto) that are required to be escrowed with Mortgagee under the related Loan Documents are being conveyed by the Sponsor to Depositor or its servicer. |
(15) | No Holdbacks. The principal amount of the Mortgage Loan stated on the loan schedule attached as an exhibit to the applicable Mortgage Loan Purchase Agreement has been fully disbursed as of the Closing Date and there is no requirement for future advances thereunder (except in those cases where the full amount of the Mortgage Loan has been disbursed but a portion thereof is being held in escrow or reserve accounts pending the satisfaction of certain conditions relating to leasing, repairs or other matters with respect to the related Mortgaged Property, the Mortgagor or other considerations determined by the Sponsor to merit such holdback). |
(16) | Insurance. Each related Mortgaged Property is, and is required pursuant to the related Mortgage to be, insured by a property insurance policy providing coverage for loss in accordance with coverage found under a “special cause of loss form” or “all risk form” that includes replacement cost valuation issued by an insurer meeting the requirements of the related Loan Documents and having a claims-paying or financial strength rating of at least “A-:VIII” from A.M. Best Company or “A3” (or the equivalent) from Moody’s Investors Service, Inc. or “A-” from Standard & Poor’s Ratings Services (collectively the “Insurance Rating Requirements”), in an amount (subject to a customary deductible) not less than the lesser of (1) the original principal balance of the Mortgage Loan and (2) the full insurable value on a replacement cost basis of the improvements, furniture, furnishings, fixtures and equipment owned by the Mortgagor and included in the Mortgaged Property (with no deduction for physical depreciation), but, in any event, not less than the amount necessary or containing such endorsements as are necessary to avoid the operation of any coinsurance provisions with respect to the related Mortgaged Property. |
Each related Mortgaged Property is also covered, and required to be covered pursuant to the related Loan Documents, by business interruption or rental loss insurance which (subject to a customary deductible) covers a period of not less than 12 months (or with respect to each Mortgage Loan on a single asset with a principal balance of $50 million or more, 18 months). |
If any material part of the improvements, exclusive of a parking lot, located on a Mortgaged Property is in an area identified in the Federal Register by the Federal Emergency Management Agency as a “Special Flood Hazard Area,” the related Mortgagor is required to maintain insurance in the maximum amount available under the National Flood Insurance Program. |
E-1-4 |
If the Mortgaged Property is located within 25 miles of the coast of the Gulf of Mexico or the Atlantic coast of Florida, Georgia, South Carolina or North Carolina, the related Mortgagor is required to maintain coverage for windstorm and/or windstorm related perils and/or “named storms” issued by an insurer meeting the Insurance Rating Requirements or endorsement covering damage from windstorm and/or windstorm related perils and/or named storms. |
The Mortgaged Property is covered, and required to be covered pursuant to the related Loan Documents, by a commercial general liability insurance policy issued by an insurer meeting the Insurance Rating Requirements including coverage for property damage, contractual damage and personal injury (including bodily injury and death) in amounts as are generally required by prudent institutional commercial mortgage lenders, and in any event not less than $1 million per occurrence and $2 million in the aggregate. |
An architectural or engineering consultant has performed an analysis of each of the Mortgaged Properties located in seismic zones 3 or 4 in order to evaluate the structural and seismic condition of such property, for the sole purpose of assessing the scenario expected limit (“SEL”) for the Mortgaged Property in the event of an earthquake. In such instance, the SEL was based on a 475-year return period, an exposure period of 50 years and a 10% probability of exceedance. If the resulting report concluded that the SEL would exceed 20% of the amount of the replacement costs of the improvements, earthquake insurance on such Mortgaged Property was obtained from an insurer rated at least “A:VIII” by A.M. Best Company or “A3” (or the equivalent) from Moody’s Investors Service, Inc. or “A-” by Standard & Poor’s Ratings Services in an amount not less than 100% of the SEL. |
The Loan Documents require insurance proceeds in respect of a property loss to be applied either (a) to the repair or restoration of all or part of the related Mortgaged Property, with respect to all property losses in excess of 5% of the then outstanding principal amount of the related Mortgage Loan (or related Loan Combination), the Mortgagee (or a trustee appointed by it) having the right to hold and disburse such proceeds as the repair or restoration progresses, or (b) to the payment of the outstanding principal balance of such Mortgage Loan together with any accrued interest thereon. |
All premiums on all insurance policies referred to in this section required to be paid as of the Cut-off Date have been paid, and such insurance policies name the Mortgagee under the Mortgage Loan and its successors and assigns as a loss payee under a mortgagee endorsement clause or, in the case of the general liability insurance policy, as named or additional insured. Such insurance policies will inure to the benefit of the Trustee. Each related Mortgage Loan obligates the related Mortgagor to maintain all such insurance and, at such Mortgagor’s failure to do so, authorizes the Mortgagee to maintain such insurance at the Mortgagor’s reasonable cost and expense and to charge such Mortgagor for related premiums. All such insurance policies (other than commercial liability policies) require at least 10 days’ prior notice to the Mortgagee of termination or cancellation arising because of nonpayment of a premium and at least 30 days’ prior notice to the Mortgagee of termination or cancellation (or such lesser period, not less than 10 days, as may be required by applicable law) arising for any reason other than non-payment of a premium and no such notice has been received by the Sponsor. |
(17) | Access; Utilities; Separate Tax Lots. Each Mortgaged Property (a) is located on or adjacent to a public road and has direct legal access to such road, or has access via an irrevocable easement or irrevocable right of way permitting ingress and egress to/from a public road, (b) is served by or has uninhibited access rights to public or private water and sewer (or well and septic) and all required utilities, all of which are appropriate for the current use of the Mortgaged Property, and (c) constitutes one or more separate tax parcels which do not include any property which is not part of the Mortgaged Property or is subject to an endorsement under the related Title Policy insuring the Mortgaged Property, or in certain cases, an application has been, or will be, made to the applicable governing authority for creation of separate tax lots, in which case the Mortgage Loan requires the Mortgagor to escrow an amount sufficient to pay taxes for the existing tax parcel of which the Mortgaged Property is a part until the separate tax lots are created. |
(18) | No Encroachments. To the Sponsor’s knowledge based solely on surveys obtained in connection with origination and the Mortgagee’s Title Policy (or, if such policy is not yet issued, a pro forma title policy, a preliminary title policy with escrow instructions or a “marked up” commitment) obtained in connection with the origination of each Mortgage Loan, all material improvements that were included for the purpose of determining the appraised value of the related Mortgaged Property at the time of the origination of such |
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Mortgage Loan are within the boundaries of the related Mortgaged Property, except encroachments that do not materially and adversely affect the value or current use of such Mortgaged Property or for which insurance or endorsements were obtained under the Title Policy. No improvements on adjoining parcels encroach onto the related Mortgaged Property except for encroachments that do not materially and adversely affect the value or current use of such Mortgaged Property or for which insurance or endorsements were obtained under the Title Policy. No improvements encroach upon any easements except for encroachments the removal of which would not materially and adversely affect the value or current use of such Mortgaged Property or for which insurance or endorsements were obtained under the Title Policy. |
(19) | No Contingent Interest or Equity Participation. No Mortgage Loan has a shared appreciation feature, any other contingent interest feature or a negative amortization feature or an equity participation by the Sponsor (except that any ARD Loan may provide for the accrual of the portion of interest in excess of the rate in effect prior to its related Anticipated Repayment Date). |
(20) | REMIC. The Mortgage Loan is a “qualified mortgage” within the meaning of Section 860G(a)(3) of the Code (but determined without regard to the rule in Treasury Regulations Section 1.860G-2(f)(2) that treats certain defective mortgage loans as qualified mortgages), and, accordingly, (A) the issue price of the Mortgage Loan to the related Mortgagor at origination did not exceed the non-contingent principal amount of the Mortgage Loan and (B) either: (a) such Mortgage Loan is secured by an interest in real property (including buildings and structural components thereof, but excluding personal property) having a fair market value (i) at the date the Mortgage Loan (or related Loan Combination) was originated at least equal to 80% of the adjusted issue price of the Mortgage Loan (or related Loan Combination) on such date or (ii) at the Closing Date at least equal to 80% of the adjusted issue price of the Mortgage Loan (or related Loan Combination) on such date,provided that for purposes hereof, the fair market value of the real property interest must first be reduced by (A) the amount of any lien on the real property interest that is senior to the Mortgage Loan and (B) a proportionate amount of any lien that is in parity with the Mortgage Loan; or (b) substantially all of the proceeds of such Mortgage Loan were used to acquire, improve or protect the real property which served as the only security for such Mortgage Loan (other than a recourse feature or other third-party credit enhancement within the meaning of Treasury Regulations Section 1.860G-2(a)(1)(ii)). If the Mortgage Loan was “significantly modified” prior to the Closing Date so as to result in a taxable exchange under Section 1001 of the Code, it either (x) was modified as a result of the default or reasonably foreseeable default of such Mortgage Loan or (y) satisfies the provisions of either sub-clause (B)(a)(i) above (substituting the date of the last such modification for the date the Mortgage Loan was originated) or sub-clause (B)(a)(ii), including the proviso thereto. Any prepayment premium and yield maintenance charges applicable to the Mortgage Loan constitute “customary prepayment penalties” within the meaning of Treasury Regulations Section 1.860G-1(b)(2). All terms used in this paragraph shall have the same meanings as set forth in the related Treasury Regulations. |
(21) | Compliance with Usury Laws. The Mortgage Rate (exclusive of any default interest, late charges, yield maintenance charge, or prepayment premiums) of such Mortgage Loan complied as of the date of origination with, or was exempt from, applicable state or federal laws, regulations and other requirements pertaining to usury. |
(22) | Authorized to do Business. To the extent required under applicable law, as of the Cut-off Date or as of the date that such entity held the Mortgage Note, each holder of the Mortgage Note was authorized to originate, acquire and/or hold (as applicable) the Mortgage Note in the jurisdiction in which each related Mortgaged Property is located, or the failure to be so authorized does not materially and adversely affect the enforceability of such Mortgage Loan by the Trust. |
(23) | Trustee under Deed of Trust. With respect to each Mortgage which is a deed of trust, as of the date of origination and, to the Sponsor’s knowledge, as of the Closing Date, a trustee, duly qualified under applicable law to serve as such, currently so serves and is named in the deed of trust or has been substituted in accordance with the Mortgage and applicable law or may be substituted in accordance with the Mortgage and applicable law by the related Mortgagee. |
(24) | Local Law Compliance. To the Sponsor’s knowledge, based upon any of a letter from any governmental authorities, a legal opinion, an architect’s letter, a zoning consultant’s report, an endorsement to the |
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related Title Policy, or other affirmative investigation of local law compliance consistent with the investigation conducted by the Sponsor for similar commercial and multifamily mortgage loans intended for securitization, there are no material violations of applicable zoning ordinances, building codes and land laws (collectively “Zoning Regulations”) with respect to the improvements located on or forming part of each Mortgaged Property securing a Mortgage Loan as of the date of origination of such Mortgage Loan (or related Loan Combination, as applicable) or as of the Cut-off Date, other than those which (i) are insured by the Title Policy or a law and ordinance insurance policy or (ii) would not have a material adverse effect on the value, operation or net operating income of the Mortgaged Property. The terms of the Loan Documents require the Mortgagor to comply in all material respects with all applicable governmental regulations, zoning and building laws. |
(25) | Licenses and Permits. Each Mortgagor covenants in the Loan Documents that it shall keep all material licenses, permits and applicable governmental authorizations necessary for its operation of the Mortgaged Property in full force and effect, and to the Sponsor’s knowledge based upon any of a letter from any government authorities or other affirmative investigation of local law compliance consistent with the investigation conducted by the Sponsor for similar commercial and multifamily mortgage loans intended for securitization, all such material licenses, permits and applicable governmental authorizations are in effect. The Mortgage Loan requires the related Mortgagor to be qualified to do business in the jurisdiction in which the related Mortgaged Property is located. |
(26) | Recourse Obligations. The Loan Documents for each Mortgage Loan provide that such Mortgage Loan (a) becomes full recourse to the Mortgagor and guarantor (which is a natural person or persons, or an entity distinct from the Mortgagor (but may be affiliated with the Mortgagor) that has assets other than equity in the related Mortgaged Property that are not de minimis) in any of the following events: (i) if any voluntary petition for bankruptcy, insolvency, dissolution or liquidation pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by the Mortgagor; (ii) the Mortgagor or guarantor shall have colluded with (or, alternatively, solicited or caused to be solicited) other creditors to cause an involuntary bankruptcy filing with respect to the Mortgagor or (iii) voluntary transfers of either the Mortgaged Property or equity interests in Mortgagor made in violation of the Loan Documents; and (b) contains provisions providing for recourse against the Mortgagor and guarantor (which is a natural person or persons, or an entity distinct from the Mortgagor (but may be affiliated with the Mortgagor) that has assets other than equity in the related Mortgaged Property that are not de minimis), for losses and damages sustained by reason of Mortgagor’s (i) misappropriation of rents after the occurrence of an event of default under the Mortgage Loan; (ii) misappropriation of (A) insurance proceeds or condemnation awards or (B) security deposits or, alternatively, the failure of any security deposits to be delivered to Mortgagee upon foreclosure or action in lieu thereof (except to the extent applied in accordance with leases prior to a Mortgage Loan event of default); (iii) fraud or intentional material misrepresentation; (iv) breaches of the environmental covenants in the Loan Documents; or (v) commission of intentional material physical waste at the Mortgaged Property (but, in some cases, only to the extent there is sufficient cash flow generated by the related Mortgaged Property to prevent such waste). |
(27) | Mortgage Releases. The terms of the related Mortgage or related Loan Documents do not provide for release of any material portion of the Mortgaged Property from the lien of the Mortgage except (a) a partial release, accompanied by principal repayment, of not less than a specified percentage at least equal to the lesser of (i) 110% of the related allocated loan amount of such portion of the Mortgaged Property and (ii) the outstanding principal balance of the Mortgage Loan, (b) upon payment in full of such Mortgage Loan, (c) upon a Defeasance defined in (32) below, (d) releases of out-parcels that are unimproved or other portions of the Mortgaged Property which will not have a material adverse effect on the underwritten value of the Mortgaged Property and which were not afforded any material value in the appraisal obtained at the origination of the Mortgage Loan and are not necessary for physical access to the Mortgaged Property or compliance with zoning requirements, or (e) as required pursuant to an order of condemnation or taking by a State or any political subdivision or authority thereof. With respect to any partial release under the preceding clauses (a) or (d), either: (x) such release of collateral (i) would not constitute a “significant modification” of the subject Mortgage Loan within the meaning of Treasury Regulations Section 1.860G-2(b)(2) and (ii) would not cause the subject Mortgage Loan to fail to be a “qualified mortgage” within the meaning of Section 860G(a)(3)(A) of the Code; or (y) the Mortgagee or servicer can, in accordance with the related Loan Documents, condition such release of collateral on the related Mortgagor’s delivery of an opinion of tax counsel to the effect specified in the immediately |
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preceding clause (x). For purposes of the preceding clause (x), for all Mortgage Loans originated after December 6, 2010, if the fair market value of the real property constituting such Mortgaged Property after the release is not equal to at least 80% of the principal balance of the Mortgage Loan (or related Loan Combination) outstanding after the release, the Mortgagor is required to make a payment of principal in an amount not less than the amount required by the REMIC Provisions. |
With respect to any partial release under the preceding clause (e), for all Mortgage Loans originated after December 6, 2010, the Mortgagor can be required to pay down the principal balance of the Mortgage Loan in an amount not less than the amount required by the REMIC Provisions and, to such extent, such amount may not be required to be applied to the restoration of the Mortgaged Property or released to the Mortgagor, if, immediately after the release of such portion of the Mortgaged Property from the lien of the Mortgage (but taking into account the planned restoration) the fair market value of the real property constituting the remaining Mortgaged Property is not equal to at least 80% of the remaining principal balance of the Mortgage Loan (or related Loan Combination). |
No Mortgage Loan that is secured by more than one Mortgaged Property or that is cross-collateralized with another Mortgage Loan permits the release of cross-collateralization of the related Mortgaged Properties or a portion thereof, including due to partial condemnation, other than in compliance with the REMIC Provisions. |
(28) | Financial Reporting and Rent Rolls. The Mortgage Loan documents for each Mortgage Loan require the Mortgagor to provide the owner or holder of the Mortgage with quarterly (other than for single-tenant properties) and annual operating statements, and quarterly (other than for single-tenant properties) rent rolls for properties that have leases contributing more than 5% of the in-place base rent and annual financial statements, which annual financial statements with respect to each Mortgage Loan with more than one Mortgagor are in the form of an annual combined balance sheet of the Mortgagor entities (and no other entities), together with the related combined statements of operations, members’ capital and cash flows, including a combining balance sheet and statement of income for the Mortgaged Properties on a combined basis. |
(29) | Acts of Terrorism Exclusion. With respect to each Mortgage Loan over $20 million, the related special-form all-risk insurance policy and business interruption policy (issued by an insurer meeting the Insurance Rating Requirements) do not specifically exclude Acts of Terrorism, as defined in the Terrorism Risk Insurance Act of 2002, as amended by the Terrorism Risk Insurance Program Reauthorization Act of 2007, and as amended by the Terrorism Risk Insurance Program Reauthorization Act of 2015 (collectively referred to as “TRIA”), from coverage, or if such coverage is excluded, it is covered by a separate terrorism insurance policy. With respect to each other Mortgage Loan, the related special all-risk insurance policy and business interruption policy (issued by an insurer meeting the Insurance Rating Requirements) did not, as of the date of origination of the Mortgage Loan, and, to the Sponsor’s knowledge, do not, as of the Cut-off Date, specifically exclude Acts of Terrorism, as defined in TRIA, from coverage, or if such coverage is excluded, it is covered by a separate terrorism insurance policy. With respect to each Mortgage Loan, the related Loan Documents do not expressly waive or prohibit the Mortgagee from requiring coverage for Acts of Terrorism, as defined in TRIA, or damages related thereto;provided,however, that if TRIA or a similar or subsequent statute is not in effect, then,provided that terrorism insurance is commercially available, the Mortgagor under each Mortgage Loan is required to carry terrorism insurance, but in such event the Mortgagor shall not be required to spend more than the Terrorism Cap Amount on terrorism insurance coverage, and if the cost of terrorism insurance exceeds the Terrorism Cap Amount, the Mortgagor is required to purchase the maximum amount of terrorism insurance available with funds equal to the Terrorism Cap Amount. The “Terrorism Cap Amount” is the specified percentage (which is at least equal to 200%) of the amount of the insurance premium that is payable at such time in respect of the property and business interruption/rental loss insurance requiredunder the related Loan Documents (without giving effect to the cost of terrorism and earthquake components of such casualty and business interruption/rental loss insurance). |
(30) | Due on Sale or Encumbrance. Subject to specific exceptions set forth below, each Mortgage Loan contains a “due on sale” or other such provision for the acceleration of the payment of the unpaid principal balance of such Mortgage Loan if, without the consent of the holder of the Mortgage (which consent, in some cases, may not be unreasonably withheld) and/or complying with the requirements of the related Loan Documents (which provide for transfers without the consent of the Mortgagee which are |
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customarily acceptable to prudent commercial and multifamily mortgage lending institutions lending on the security of property comparable to the related Mortgaged Property, including, without limitation, transfers of worn-out or obsolete furnishings, fixtures, or equipment promptly replaced with property of equivalent value and functionality and transfers by leases entered into in accordance with the Loan Documents), (a) the related Mortgaged Property, or any equity interest of greater than 50% in the related Mortgagor, is directly or indirectly pledged, transferred or sold, other than as related to (i) family and estate planning transfers or transfers upon death or legal incapacity, (ii) transfers to certain affiliates as defined in the related Loan Documents, (iii) transfers of less than, or other than, a controlling interest in the related Mortgagor, (iv) transfers to another holder of direct or indirect equity in the Mortgagor, a specific Person designated in the related Loan Documents or a Person satisfying specific criteria identified in the related Loan Documents, such as a qualified equityholder, (v) transfers of stock or similar equity units in publicly traded companies or (vi) a substitution or release of collateral within the parameters of paragraphs (27) and (32) of this Annex E-1 or the exceptions thereto set forth on Annex E-2, or (vii) as set forth on an exhibit to the applicable Mortgage Loan Purchase Agreement by reason of any mezzanine debt that existed at the origination of the related Mortgage Loan, or future permitted mezzanine debt as set forth on an exhibit to the applicable Mortgage Loan Purchase Agreement or (b) the related Mortgaged Property is encumbered with a subordinate lien or security interest against the related Mortgaged Property, other than (i) any Companion Loan of any Mortgage Loan or any subordinate debt that existed at origination and is permitted under the related Loan Documents, (ii) purchase money security interests (iii) any Mortgage Loan that is cross-collateralized and cross-defaulted with another Mortgage Loan, as set forth on an exhibit to the applicable Mortgage Loan Purchase Agreement or (iv) Permitted Encumbrances. The Mortgage or other Loan Documents provide that to the extent any Rating Agency fees are incurred in connection with the review of and consent to any transfer or encumbrance, the Mortgagor is responsible for such payment along with all other reasonable out-of-pocket fees and expenses incurred by the Mortgagee relative to such transfer or encumbrance. |
(31) | Single-Purpose Entity. Each Mortgage Loan requires the Mortgagor to be a Single-Purpose Entity for at least as long as the Mortgage Loan is outstanding. Both the Loan Documents and the organizational documents of the Mortgagor with respect to each Mortgage Loan with a Cut-off Date Principal Balance in excess of $5 million provide that the Mortgagor is a Single-Purpose Entity, and each Mortgage Loan with a Cut-off Date Principal Balance of $20 million or more has a counsel’s opinion regarding non-consolidation of the Mortgagor. For this purpose, a “Single-Purpose Entity” shall mean an entity, other than an individual, whose organizational documents (or if the Mortgage Loan has a Cut-off Date Principal Balance equal to $5 million or less, its organizational documents or the related Loan Documents) provide substantially to the effect that it was formed or organized solely for the purpose of owning and operating one or more of the Mortgaged Properties securing the Mortgage Loans and prohibit it from engaging in any business unrelated to such Mortgaged Property or Properties, and whose organizational documents further provide, or which entity represented in the related Loan Documents, substantially to the effect that it does not have any assets other than those related to its interest in and operation of such Mortgaged Property or Properties, or any indebtedness other than as permitted by the related Mortgage(s) or the other related Loan Documents, that it has its own books and records and accounts separate and apart from those of any other person (other than a Mortgagor for a Mortgage Loan that is cross-collateralized and cross-defaulted with the related Mortgage Loan), and that it holds itself out as a legal entity, separate and apart from any other person or entity. |
(32) | Defeasance. With respect to any Mortgage Loan that, pursuant to the Loan Documents, can be defeased (a “Defeasance”), (i) the Loan Documents provide for defeasance as a unilateral right of the Mortgagor, subject to satisfaction of conditions specified in the Loan Documents; (ii) the Mortgage Loan cannot be defeased within two years after the Closing Date; (iii) the Mortgagor is permitted to pledge only United States “government securities” within the meaning of Treasury Regulations Section 1.860G-2(a)(8)(ii), the revenues from which will, in the case of a full Defeasance, be sufficient to make all scheduled payments under the Mortgage Loan when due, including the entire remaining principal balance on the maturity date (or on or after the first date on which payment may be made without payment of a yield maintenance charge or prepayment penalty) or, if the Mortgage Loan is an ARD Loan, the entire principal balance outstanding on the related Anticipated Repayment Date (or on or after the first date on which payment may be made without payment of a yield maintenance charge or prepayment penalty), and if the Mortgage Loan permits partial releases of real property in connection with partial defeasance, the revenues from the collateral will be sufficient to pay all such scheduled payments calculated on a principal amount equal to a specified percentage at least equal to the lesser of (A) 110% of the allocated loan |
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amount for the real property to be released and (B) the outstanding principal balance of the Mortgage Loan; (iv) the Mortgagor is required to provide a certification from an independent certified public accountant that the collateral is sufficient to make all scheduled payments under the Mortgage Note as set forth in (iii) above, (v) if the Mortgagor would continue to own assets in addition to the defeasance collateral, the portion of the Mortgage Loan secured by defeasance collateral is required to be assumed (or the Mortgagee may require such assumption) by a Single-Purpose Entity; (vi) the Mortgagor is required to provide an opinion of counsel that the Mortgagee has a perfected security interest in such collateral prior to any other claim or interest; and (vii) the Mortgagor is required to pay all rating agency fees associated with defeasance (if rating confirmation is a specific condition precedent thereto) and all other reasonable out-of-pocket expenses associated with defeasance, including, but not limited to, accountant’s fees and opinions of counsel. |
(33) | Fixed Interest Rates. Each Mortgage Loan bears interest at a rate that remains fixed throughout the remaining term of such Mortgage Loan, except in the case of ARD Loans and in situations where default interest is imposed. |
(34) | Ground Leases. For purposes of this Annex E-1, a “Ground Lease” shall mean a lease creating a leasehold estate in real property where the fee owner as the ground lessor conveys for a term or terms of years its entire interest in the land and buildings and other improvements, if any, comprising the premises demised under such lease to the ground lessee (who may, in certain circumstances, own the building and improvements on the land), subject to the reversionary interest of the ground lessor as fee owner and does not include industrial development agency (IDA) or similar leases for purposes of conferring a tax abatement or other benefit. |
With respect to any Mortgage Loan where the Mortgage Loan is secured by a leasehold estate under a Ground Lease in whole or in part, and the related Mortgage does not also encumber the related lessor’s fee interest in such Mortgaged Property, based upon the terms of the Ground Lease and any estoppel or other agreement received from the ground lessor in favor of the Sponsor, its successors and assigns, the Sponsor represents and warrants that: |
(a) | The Ground Lease or a memorandum regarding such Ground Lease has been duly recorded or submitted for recordation in a form that is acceptable for recording in the applicable jurisdiction. The Ground Lease or an estoppel or other agreement received from the ground lessor permits the interest of the lessee to be encumbered by the related Mortgage and does not restrict the use of the related Mortgaged Property by such lessee, its successors or assigns in a manner that would materially adversely affect the security provided by the related Mortgage. No material change in the terms of the Ground Lease had occurred since the origination of the Mortgage Loan, except as reflected in any written instruments which are included in the related Mortgage File; |
(b) | The lessor under such Ground Lease has agreed in a writing included in the related Mortgage File (or in such Ground Lease) that the Ground Lease may not be amended or modified, or canceled or terminated by agreement of lessor and lessee, without the prior written consent of the Mortgagee; |
(c) | The Ground Lease has an original term (or an original term plus one or more optional renewal terms, which, under all circumstances, may be exercised, and will be enforceable, by either Mortgagor or the Mortgagee) that extends not less than 20 years beyond the stated maturity of the related Mortgage Loan, or ten years past the stated maturity if such Mortgage Loan fullyamortizes by the stated maturity (or with respect to a Mortgage Loan that accrues on an actual 360 basis, substantially amortizes); |
(d) | The Ground Lease either (i) is not subject to any liens or encumbrances superior to, or of equal priority with, the Mortgage, except for the related fee interest of the ground lessor and the Permitted Encumbrances, or (ii) is subject to a subordination, non-disturbance and attornment agreement to which the Mortgagee on the lessor’s fee interest in the Mortgaged Property is subject; |
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(e) | The Ground Lease does not place commercially unreasonably restrictions on the identity of the Mortgagee and the Ground Lease is assignable to the holder of the Mortgage Loan and its successors and assigns without the consent of the lessor thereunder (provided that proper notice is delivered to the extent required in accordance with the Ground Lease), and in the event it is so assigned, it is further assignable by the holder of the Mortgage Loan and its successors and assigns without the consent of (but with prior notice to) the lessor; |
(f) | The Sponsor has not received any written notice of material default under or notice of termination of such Ground Lease. To the Sponsor’s knowledge, there is no material default under such Ground Lease and no condition that, but for the passage of time or giving of notice, would result in a material default under the terms of such Ground Lease and to the Sponsor’s knowledge, such Ground Lease is in full force and effect as of the Closing Date; |
(g) | The Ground Lease or ancillary agreement between the lessor and the lessee requires the lessor to give to the Mortgagee written notice of any default, and provides that no notice of default or termination is effective against the Mortgagee unless such notice is given to the Mortgagee; |
(h) | The Mortgagee is permitted a reasonable opportunity (including, where necessary, sufficient time to gain possession of the interest of the lessee under the Ground Lease through legal proceedings) to cure any default under the Ground Lease which is curable after the Mortgagee’s receipt of notice of any default before the lessor may terminate the Ground Lease; |
(i) | The Ground Lease does not impose any restrictions on subletting that would be viewed as commercially unreasonable by a prudent commercial mortgage lender; |
(j) | Under the terms of the Ground Lease, an estoppel or other agreement received from the ground lessor and the related Mortgage (taken together), any related insurance proceeds or the portion of the condemnation award allocable to the ground lessee’s interest (other than (i) de minimis amounts for minor casualties or (ii) in respect of a total or substantially total loss or taking as addressed in subpart (k)) will be applied either to the repair or to restoration of all or part of the related Mortgaged Property with (so long as such proceeds are in excess of the threshold amount specified in the related Loan Documents) the Mortgagee or a trustee appointed by it having the right to hold and disburse such proceeds as repair or restoration progresses, or to the payment of the outstanding principal balance of the Mortgage Loan, together with any accrued interest; |
(k) | In the case of a total or substantially total taking or loss, under the terms of the Ground Lease, an estoppel or other agreement and the related Mortgage (taken together), any related insurance proceeds, or portion of the condemnation award allocable to the ground lessee’s interest in respect of a total or substantially total loss or taking of the related Mortgaged Property to the extent not applied to restoration, will be applied first to the payment of the outstanding principal balance of the Mortgage Loan, together with any accrued interest; and |
(l) | Provided that the Mortgagee cures any defaults which are susceptible to being cured, the ground lessor has agreed to enter into a new lease with the Mortgagee upon termination of the Ground Lease for any reason, including rejection of the Ground Lease in a bankruptcy proceeding. |
(35) | Servicing. The servicing and collection practices used by the Sponsor with respect to the Mortgage Loan have been, in all respects, legal and have met customary industry standards for servicing of commercial loans for conduit loan programs. |
(36) | Origination and Underwriting. The origination practices of the Sponsor (or the related originator if the Sponsor was not the originator) with respect to each Mortgage Loan have been, in all material respects, legal and as of the date of its origination, such Mortgage Loan (or the related Loan Combination, as applicable) and the origination thereof complied in all material respects with, or was exempt from, all requirements of federal, state or local law relating to the origination of such Mortgage Loan;provided that such representation and warranty does not address or otherwise cover any matters with respect to federal, state or local law otherwise covered in this Annex E-1. |
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(37) | No Material Default; Payment Record. No Mortgage Loan has been more than 30 days delinquent, without giving effect to any grace or cure period, in making required debt service payments since origination and, as of the date hereof, no Mortgage Loan is more than 30 days delinquent (beyond any applicable grace or cure period) in making required payments as of the Closing Date. To the Sponsor’s knowledge, there is (a) no material default, breach, violation or event of acceleration existing under the related Mortgage Loan, or (b) no event (other than payments due but not yet delinquent) which, with the passage of time or with notice and the expiration of any grace or cure period, would constitute a material default, breach, violation or event of acceleration, which default, breach, violation or event of acceleration, in the case of either (a) or (b), materially and adversely affects the value of the Mortgage Loan or the value, use or operation of the related Mortgaged Property,provided,however, that this representation and warranty does not cover any default, breach, violation or event of acceleration that specifically pertains to or arises out of an exception scheduled to any other representation and warranty made by the Sponsor in this Annex E-1 (including, but not limited to, the prior sentence). No person other than the holder of such Mortgage Loan may declare any event of default under the Mortgage Loan or accelerate any indebtedness under the Mortgage Loan documents. |
(38) | Bankruptcy. As of the date of origination of the related Mortgage Loan and to the Sponsor’s knowledge as of the Cut-off Date, neither the Mortgaged Property (other than any tenants of such Mortgaged Property), nor any portion thereof, is the subject of, and no Mortgagor, guarantor or tenant occupying a single-tenant property is a debtor in state or federal bankruptcy, insolvency or similar proceeding. |
(39) | Organization of Mortgagor. With respect to each Mortgage Loan, in reliance on certified copies of the organizational documents of the Mortgagor delivered by the Mortgagor in connection with the origination of such Mortgage Loan (or related Loan Combination, as applicable), the Mortgagor is an entity organized under the laws of a state of the United States of America, the District of Columbia or the Commonwealth of Puerto Rico. Except with respect to any Mortgage Loan that is cross-collateralized and cross-defaulted with another Mortgage Loan, no Mortgage Loan has a Mortgagor that is an affiliate of another Mortgagor under another Mortgage Loan. |
(40) | Environmental Conditions. A Phase I environmental site assessment (or update of a previous Phase I and or Phase II site assessment) and, with respect to certain Mortgage Loans, a Phase II environmental site assessment (collectively, an “ESA”) meeting ASTM requirements were conducted by a reputable environmental consultant in connection with such Mortgage Loan within 12 months prior to its origination date (or an update of a previous ESA was prepared), and such ESA (i) did not identify the existence of recognized environmental conditions (as such term is defined in ASTM E1527-05 or its successor, an “Environmental Condition”) at the related Mortgaged Property or the need for further investigation, or (ii) if the existence of an Environmental Condition or need for further investigation was indicated in any such ESA, then at least one of the following statements is true: (A) an amount reasonably estimated by a reputable environmental consultant to be sufficient to cover the estimated cost to cure any material noncompliance with applicable Environmental Laws or the Environmental Condition has been escrowed by the related Mortgagor and is held or controlled by the related Mortgagee; (B) if the only Environmental Condition relates to the presence of asbestos-containing materials, radon in indoor air, lead based paint or lead in drinking water, the only recommended action in the ESA is the institution of such a plan, an operations or maintenance plan has been required to be instituted by the related Mortgagor that, based on the ESA, can reasonably be expected to mitigate the identified risk; (C) the Environmental Condition identified in the related environmental report was remediated or abated in all material respects prior to the date hereof, and, if and as appropriate, a no further action or closure letter was obtained from the applicable governmental regulatory authority (or the environmental issue affecting the related Mortgaged Property was otherwise listed by such governmental authority as “closed” or a reputable environmental consultant has concluded that no further action is required); (D) an environmental policy or a lender’s pollution legal liability insurance policy meeting the requirements set forth below that covers liability for the identified circumstance or condition was obtained from an insurer rated no less than A- (or the equivalent) by Moody’s Investors Service, Inc., Standard & Poor’s Ratings Services and/or Fitch Ratings, Inc.; (E) a party not related to the Mortgagor was identified as the responsible party for such condition or circumstance and such responsible party has financial resources reasonably estimated to be adequate to address the situation; or (F) a party related to the Mortgagor having financial resources reasonably estimated to be adequate to address the situation is required to take action. To the Sponsor’s knowledge, except as set forth in the ESA, there is no Environmental Condition (as such term is defined in ASTM E1527-05 or its successor) at the related Mortgaged Property. |
E-1-12 |
(41) | Appraisal. The Mortgage File contains an appraisal of the related Mortgaged Property with an appraisal date within six months of the Mortgage Loan origination date, and within 12 months of the Closing Date. The appraisal is signed by an appraiser who is a Member of the Appraisal Institute (“MAI”) and, to the Sponsor’s knowledge, had no interest, direct or indirect, in the Mortgaged Property or the Mortgagor or in any loan made on the security thereof, and whose compensation is not affected by the approval or disapproval of the Mortgage Loan. Each appraiser has represented in such appraisal or in a supplemental letter that the appraisal satisfies the requirements of the “Uniform Standards of Professional Appraisal Practice” as adopted by the Appraisal Standards Board of the Appraisal Foundation. Each appraisal contains a statement, or is accompanied by a letter from the appraiser, to the effect that the appraisal was performed in accordance with the requirements of the Financial Institutions Reform, Recovery and Enforcement Act of 1989, as in effect on the date such Mortgage Loan was originated. |
(42) | Mortgage Loan Schedule. The information pertaining to each Mortgage Loan which is set forth in the loan schedule attached as an exhibit to the related Mortgage Loan Purchase Agreement is true and correct in all material respects as of the Cut-off Date and contains all information required by the Pooling and Servicing Agreement to be contained therein. |
(43) | Cross-Collateralization. Except with respect to a Mortgage Loan that is part of a Loan Combination, no Mortgage Loan is cross-collateralized or cross-defaulted with any other Mortgage Loan that is outside the Mortgage Pool, except as set forth on Annex E-2. |
(44) | Advance of Funds by the Sponsor. After origination, no advance of funds has been made by the Sponsor to the related Mortgagor other than in accordance with the Loan Documents, and, to the Sponsor’s knowledge, no funds have been received from any person other than the related Mortgagor or an affiliate for, or on account of, payments due on the Mortgage Loan (other than as contemplated by the Loan Documents, such as, by way of example and not in limitation of the foregoing, amounts paid by the tenant(s) into a Mortgagee-controlled lockbox if required or contemplated under the related lease or Loan Documents). Neither the Sponsor nor any affiliate thereof has any obligation to make any capital contribution to any Mortgagor under a Mortgage Loan, other than contributions made on or prior to the date hereof. |
(45) | Compliance with Anti-Money Laundering Laws. The Sponsor has complied in all material respects with all applicable anti-money laundering laws and regulations, including without limitation the USA Patriot Act of 2001 with respect to the origination of the Mortgage Loan. |
For purposes of these representations and warranties, “Mortgagee” means the mortgagee, grantee or beneficiary under any Mortgage, any holder of legal title to any portion of any Mortgage Loan or, if applicable, any agent or servicer on behalf of such party.
For purposes of these representations and warranties, the phrases “the Sponsor’s knowledge” or “the Sponsor’s belief” and other words and phrases of like import mean, except where otherwise expressly set forth in these representations and warranties, the actual state of knowledge or belief of the Sponsor, its officers and employees directly responsible for the underwriting, origination, servicing or sale of the Mortgage Loans regarding the matters expressly set forth in these representations and warranties.
E-1-13 |
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ANNEX E-2
EXCEPTIONS TO SPONSOR REPRESENTATIONS AND WARRANTIES
The exceptions to the representations and warranties set forth below are grouped by Sponsor and listed by the number of the related representation and warranty set forth on Annex E-1 to this prospectus supplement and the Mortgaged Property name and number identified on Annex A to this prospectus supplement. Capitalized terms used but not otherwise defined in this Annex E-2 will have the meanings set forth in this prospectus supplement or, if not defined in this prospectus supplement, in the related Mortgage Loan Purchase Agreement.
Citigroup Global Markets Realty Corp.
Representation Number | Mortgaged Property | Description of Exception | ||
(5) Lien; Valid Assignment | Crowne Plaza Bloomington (Loan No. 16) | A portion of the Mortgaged Property consists of a leasehold interest in 300 parking spaces in a parking garage located adjacent to the hotel portion of the Mortgaged Property, pursuant to a lease agreement, which expires in January 2041 (the “Parking Space Lease”). The Parking Space Lease has been subordinated to a mortgage on the fee interest in the parking garage. | ||
(6) Permitted Liens; Title Insurance | Oklahoma Walmart Portfolio (Loan No. 12) | The sole tenant, Wal-Mart Stores East, LP, at each of the Mortgaged Properties, has a right of first refusal to receive a copy of any negotiated purchase agreement or term sheet for the sale of the related leased premises and to elect to purchase its leased premises within 15 days following the Mortgagor’s receipt of such negotiated purchase agreement or term sheet. The right of first refusal does not apply in connection with a foreclosure or deed-in-lieu of foreclosure. | ||
(6) Permitted Liens; Title Insurance | Crowne Plaza Bloomington (Loan No. 16) | The Parking Space Lease has been subordinated to a mortgage on the fee interest in the parking garage. | ||
(6) Permitted Liens; Title Insurance | Walgreens Winston-Salem (Loan No. 39) | The sole tenant at the Mortgaged Property, Walgreen Co., has a right of first refusal pursuant to its lease to purchase the Mortgaged Property if the Mortgagor receives a bona fide offer from a third party that Mortgagor intends to accept. The ROFR does not apply to a foreclosure, deed-in-lieu of foreclosure or any other enforcement action under the Mortgage Loan documents; however, such ROFR applies to subsequent purchasers of the respective Mortgaged Property. | ||
(6) Permitted Liens; Title Insurance | Rite Aid Portfolio (Loan No. 42) | The sole tenant at each of the Mortgaged Properties has a right of first refusal to purchase all or any portion of its leased premises from the Mortgagor upon the same terms and conditions as a third-party offer secured or received by the Mortgagor within 20 days of receiving notice of such offer from the landlord. The tenant’s right of first refusal does not apply in connection with a foreclosure or deed-in-lieu of foreclosure; however, such ROFR applies to subsequent purchasers of the respective leased premises. | ||
(8) Assignment of Leases and Rents | Crowne Plaza Bloomington (Loan No. 16) | The Parking Space Lease has been subordinated to a mortgage on the fee interest in the parking garage. | ||
(10) Condition of Property | Crowne Plaza Bloomington (Loan No. 16) | No representation is made as to the Parking Space Lease. | ||
(11) Taxes and Assessments | Crowne Plaza Bloomington (Loan No. 16) | No representation is made as to the Parking Space Lease. |
E-2-1 |
Representation Number | Mortgaged Property | Description of Exception | ||
(16) Insurance | Pasadena Office Tower (Loan No. 4) | The related Mortgaged Property is subject to a recorded Easement, Covenant and Restriction and Parking Agreement (the “Easement Agreement”) between the owner of the related Mortgaged Property and the owner of a parcel adjacent to the Mortgaged Property. Under the Easement Agreement, in the event of casualty or partial condemnation with respect to portions of the related Mortgaged Property that are identified in the Easement Agreement, the insurance proceeds and awards with respect to such required portions of the related Mortgaged Property must be deposited with a depository as set forth in the Easement Agreement and utilized for restoration. | ||
(16) Insurance | Oklahoma Walmart Portfolio (Loan No. 12) | The related Mortgage Loan documents provide that the insurance requirements under the Mortgage Loan documents will be deemed satisfied if (i) the lease with the single tenant, Wal-Mart Stores East, LP (“Wal-Mart”), at each of the Mortgaged Properties, is in full force and effect, (ii) no default beyond any applicable notice and cure period is continuing under such lease, (iii) Wal-Mart (or any lease guarantor thereof) remains fully liable for the obligations and liabilities under its and maintains a credit rating from S&P of at least “BBB”, (iv) such lease will remain in full force and effect following a casualty and the is obligated to rebuild and/or repair the Mortgaged Property at its sole cost and expense with no period of rent abatement and (v) such tenant maintains, either through a program of self-insurance or otherwise, the insurance required to be maintained by it under its lease. | ||
(16) Insurance | Crowne Plaza Bloomington (Loan No. 16) | No representation is made as to the Parking Space Lease. In addition, the Parking Space Lease provides that the lessor is obligated to restore the premises in connection with a casualty or condemnation but that insurance or condemnation proceeds are held and disbursed by the lessor. | ||
(16) Insurance | Walgreens Winston-Salem (Loan No. 39) | The loan documents provide that for so long as the sole tenant at the Mortgaged Property is Walgreen Co. and such tenant is maintaining the “all-risk” or “special perils” insurance coverage, the deductible is permitted to be $100,000. | ||
(17) Access; Utilities; Separate Tax Lots | Crowne Plaza Bloomington (Loan No. 16) | No representation is made as to the Parking Space Lease. | ||
(24) Local Law Compliance | Crowne Plaza Bloomington (Loan No. 16) | No representation is made as to the Parking Space Lease. In addition, the leased spaces are required for the Mortgaged Property’s compliance with parking requirements under local law. | ||
(25) Licenses and Permits | Crowne Plaza Bloomington (Loan No. 16) | No representation is made as to the Parking Space Lease. | ||
(26) Recourse Obligations | Northfield Office Complex (Loan No. 33) | Full recourse for voluntary transfers of either the Mortgaged Property or equity interests in Mortgagor in violation of the Mortgage Loan Documents does not apply if (a) Mortgagor corrects such failure within 30 days of notice from Mortgagee, and (b) such default is not a sale or pledge of a direct interest in the Mortgaged Property. | ||
(29) Acts of Terrorism Exclusion | Crowne Plaza Bloomington (Loan No. 16) | No representation is made as to the Parking Space Lease. | ||
(30) Due on Sale or Encumbrance | Magnolia Hotel Omaha (Loan No. 17) | The Mortgage Loan Documents permit transfers and pledges of more than 50% of the equity interests in the related Mortgagor provided that after giving effect to such transfer/pledge and any enforcement of the transfer/pledge, the related non-recourse carve-out guarantor must continue to own at least 20% of the direct or indirect interests in the Mortgagor and control the Mortgagor and, directly or indirectly, the day to day operations of the Mortgaged Property. |
E-2-2 |
Representation Number | Mortgaged Property | Description of Exception | ||
(31) Single-Purpose Entity | Avalon Apartments (Loan No. 23) | The related Mortgagor is the debtor under a 2009 note to an unrelated lender. The related Mortgagor was released from all personal liability in 2011. The note is not secured by any property owned by the related Mortgagor or in which the related Mortgagor has an interest, but remains outstanding, and is recourse to an affiliate of the Mortgagor. | ||
(34) Ground Leases | Crowne Plaza Bloomington (Loan No. 16) | No representation is made as to the Parking Space Lease. The Parking Space Lease has been subordinated to a mortgage on the fee interest in the parking garage. The lessor under the lease is unrelated to the Mortgagor and did not provide an estoppel and therefore there is no (i) agreement that the lease may not be modified without Mortgagee’s consent, (ii) right of Mortgagee to cure a default under the lease and (iii) right of Mortgagee to receive a new lease in the event the Parking Space Lease is terminated for any reason. In addition, the Parking Space Lease does not address assignments of the lease a lender. The Parking Space Lease provides that the lessor is obligated to restore the premises in connection with a casualty or condemnation but that insurance or condemnation proceeds are held and disbursed by the lessor. | ||
(34) Ground Leases | Kohl’s Tallahassee FL (Loan No. 40) | (i) In the event that the sublease at the Mortgaged Property with the tenant Kohl’s terminates, the Ground Lease does not impose restrictions on the identity of a future sublessee; however, the related lessor Is only obligated to enter into a non disturbance and attornment agreement with such subtenant if (a) the subtenant has a net worth of at least $10,000,000; (b) the rent under the new sublease is sufficient to cover the then-current rent under the Ground Lease, and (c) the term of the new sublease is equal to or greater than the remaining term under the Ground Lease. | ||
(34) Ground Leases | Cedar - Dover Plaza (Loan No. 49) | (b) Amendment or modification of the related Ground Lease without Mortgagee’s consent is not prohibited pursuant to the terms of the Ground Lease or estoppel.
(j), (k) The Ground Lease is silent with respect to insurance proceeds and condemnation awards but no improvements are located on the Ground Leased portion of the Mortgaged Property.
| ||
(40) Environmental Conditions | Crowne Plaza Bloomington (Loan No. 16) | No representation is made as to the Parking Space Lease. | ||
(41) Appraisal | Crowne Plaza Bloomington (Loan No. 16) | No representation is made as to the Parking Space Lease. |
E-2-3 |
Goldman Sachs Mortgage Company
Representation Number | Mortgaged Property | Description of Exception | ||
(5) Lien; Valid Assignment | Selig Office Portfolio (Loan No. 2) | The borrower is permitted to obtain pari passu debt, subject to the conditions set forth in the loan agreement, which include LTV, DSCR and Debt Yield hurdles, Rating Agency confirmation and a co-lender agreement acceptable to the Mortgagee. | ||
(5) Lien; Valid Assignment | Dallas Market Center (Loan No. 3) | The Mortgages provided in favor of Mortgagee grant a lien on both the fee interest held by an affiliate and the leasehold interest (pursuant to 4 separate ground leases) in the Mortgaged Property held by borrower. | ||
(6) Permitted Liens; Title Insurance | Mesa Town Center (Loan No. 10) | The largest tenant at the Mortgaged Property, Albertsons, has a right of first refusal to purchase Tax Lots 69 and 70 (which do not comprise the entire Mortgaged Property) in the event the landlord receives a bona fide offer to purchase such lots. A subordination and non-disturbance agreement was not obtained. | ||
(7) Junior Liens | Selig Office Portfolio (Loan No. 2) | The borrower is permitted to obtain pari passu debt, subject to the conditions set forth in the loan agreement, which include LTV, DSCR and Debt Yield hurdles, Rating Agency confirmation and a co-lender agreement acceptable to the Mortgagee. | ||
(16) Insurance | Selig Office Portfolio
Dallas Market Center
Orinda Square
Park at Sugar Creek
Mesa Town Center
| All policies may be issued by one or more insurers having a rating of at least “A” by S&P and “A2” by Moody’s (or, if Moody’s does not rate such insurer, at least “A: VIII” by AM Best), or by a syndicate of insurers through which at least 75% of the coverage (if there are 4 or fewer members of the syndicate) or at least 60% of the coverage (if there are 5 or more members of the syndicate) is with insurers having such ratings (provided that the first layers of coverage are from insurers rated at least “A” by S&P and “A2” by Moody’s (or, if Moody’s does not rate such insurer, at least “A: VIII” by AM Best), and all such insurers are required to have ratings of not less than “BBB+” by S&P and “Baa1” by Moody’s (or, if Moody’s does not rate such insurer, at least “A: VIII” by AM Best). | ||
(16) Insurance | Hagerstown Plaza (Loan No. 14) | The borrower may rely on the property and general liability insurance provided by the tenant doing business as Giant Food Stores, LLC for its leased premises so long as such insurance is maintained in compliance with the terms of the applicable lease and satisfies the other requirements set forth in the related Mortgage Loan documents. | ||
(16) Insurance | Truckee River Terraces (Loan No. 30) | All policies may be issued by one or more insurers having a rating of at least “A” by S&P and “A2” by Moody’s (or, if Moody’s does not rate such insurer, at least “A: IX” by AM Best), or by a syndicate of insurers through which at least 75% of the coverage (if there are 4 or fewer members of the syndicate) or at least 60% of the coverage (if there are 5 or more members of the syndicate) is with insurers having such ratings (provided that the first layers of coverage are from insurers rated at least “A” by S&P and “A2” by Moody’s (or, if Moody’s does not rate such insurer, at least “A: IX” by AM Best), and all such insurers are required to have ratings of not less than “A” by S&P and “Baa1” by Moody’s (or, if Moody’s does not rate such insurer, at least “A: IX” by AM Best). | ||
(16) Insurance | Castroville Industrial Portfolio (Loan No. 35) | The seismic report for the Mortgaged Property identified on Annex A as 11145 and 11165 Commercial Parkway concluded that the weighted average scenario expected loss for such Mortgaged Property would equal approximately 20.6% of the amount of the replacement costs of the improvements, and the borrower was not required to obtain earthquake insurance on such Mortgaged Property. |
E-2-4 |
Representation Number | Mortgaged Property | Description of Exception | ||
(30) Due on Sale or Encumbrance | Selig Office Portfolio (Loan No. 2) | The borrower is permitted to obtain pari passu debt, subject to theconditions set forth in the loan agreement, which include LTV, DSCR and Debt Yield hurdles, Rating Agency confirmation and a co-lender agreement acceptable to the Mortgagee. | ||
(31) Single-Purpose Entity | Orinda Square
Park at Sugar Creek
Mesa Town Center
| The borrower was not required to deliver a non-consolidation opinion in connection with the origination of the Mortgage Loan. | ||
(40) Environmental Conditions | Park at Sugar Creek (Loan No. 9) | The Phase I ESA for the related Mortgaged Property identified an active dry cleaner facility as a recognized environmental condition, based on the continued use of chlorinated solvents since the time of the most recent subsurface investigation in 1996. The ESA recommended further investigation at the tenant space, at an estimated cost of $10,000 - $12,000. |
E-2-5 |
Rialto Mortgage Finance, LLC
Representation Number | Mortgaged Property | Description of Exception | ||
(13) Actions Concerning Mortgage Loan
| Promenades Plaza
Highlands Plaza
| There is a pending judgment against Jeff O. Morr, the carve out guarantor, in the approximate amount of $700,000 in connection with his personal guaranty on a $960,000 loan with Bank of Miami secured by a property in Hollywood, Florida. In November 2009, the Bank of Miami foreclosed on the Hollywood property and in November 2010, the bank obtained the judgment. The Bank of Miami and the guarantor reached a tentative settlement whereby Morr would owe $50,000 in satisfaction of the judgment. However, the settlement was never finalized as the Bank of Miami was taken over on December 17, 2010 by Federal regulators, and the regulators subsequently arranged for the assets of Bank of Miami to be taken over by 1st United Bank (which bank was subsequently acquired by Valley National Bank). The guarantor has made unsuccessful attempts to contact Valley National Bank regarding the settlement agreement, and has not received any response to those attempts. | ||
(24) Local Law Compliance | NY Seven Self Storage Portfolio (Loan No. 11) | Self-storage is not a permitted use under the current zoning code at the Mortgaged Properties identified,
With respect to the Mortgaged Property identified on Annex A as A Space Place, in the event a casualty damages 50% or more of the legal nonconforming structure’s market value, exclusive of the foundation, the Mortgagor will be required to rebuild in strict conformity with the applicable zoning code and the current use will not be permitted.
With respect to the Mortgaged Property identified on Annex A as Snyders Best Rate, in the event a casualty damages 75% or more of the legal nonconforming structure’s market value, exclusive of the foundation, the Mortgagor will be required to rebuild in strict conformity with the applicable zoning code and the current use will not be permitted.
With respect to the Mortgaged Properties identified on Annex A as Affordable Wilton and Affordable Saratoga, in the event a casualty, the respective properties may be rebuilt to their existing use as long as such rebuild is initiated within one (1) year of the casualty and completed within two (2) years of such casualty. To the extent the respective properties are not rebuilt within this timeframe, the respective Mortgagors will be required to rebuild in strict conformity with the applicable zoning code and the current use will not be permitted.
The Loan Documents provide for recourse to the Mortgagor and the guarantors for losses related to the non-conforming use in the event any Mortgaged Property cannot be restored to its current use. Additionally, the Mortgagor and guarantors are fully liable for and guaranty payment of any insurance shortfall that may result from any casualty that prevents rebuilding to the existing use.
The Mortgaged Property identified on Annex A as Snyders Best Rate also has an existing zoning violation relating to unpermitted equipment and vehicle storage. The Mortgagor is required to perform any work necessary to remove the equipment and vehicles from the property and cure the violation within forty-five (45) days of the Mortgage Loan closing date. The Mortgage Loan is recourse to the Mortgagors and the guarantors for losses incurred if the covenant is not complied within the 45-day period. |
E-2-6 |
Representation Number | Mortgaged Property | Description of Exception | ||
(25) Licenses and Permits | NY Seven Self Storage Portfolio (Loan No. 11) | One building on the Affordable Wilton property (3 Commerce Park, Gansevoort, NY) is missing a certificate of occupancy due to an open building permit. The Mortgagor is required to obtain the certificate of occupancy within thirty (30) days of the loan closing date. There is recourse for losses to the Mortgagor and the guarantors if the certificate of occupancy is not obtained within the allotted timeframe. | ||
(25) Licenses and Permits | Cape May Portfolio
| The property records for the Mortgaged Property identified on Annex A as North Cape May Storage indicate that thirteen buildings were approved in connection with the development of the North Cape May Storage property. However, certificates of occupancy for three of the thirteen approved buildings on the North Cape May Storage property are missing. The Mortgagor has covenanted to obtain the missing certificates of occupancy within sixty (60) days of the loan closing date. There is recourse to the Mortgagor and the guarantor for losses that result from the failure to obtain the missing certificates of occupancy. | ||
(39) Organization of Mortgagor | NY Seven Self Storage Portfolio
Cape May Portfolio
On-Site Self Storage
| The Mortgagors under each of the Mortgage Loans are affiliated entities. | ||
(39) Organization of Mortgagor | Promenades Plaza
Highlands Plaza | The Mortgagors under each of the Mortgage Loans are affiliated entities.
|
E-2-7 |
RAIT Funding, LLC
Representation Number | Mortgaged Property | Description of Exception | ||
(6) Permitted Liens; Title Insurance | St. Anthony’s Healthplex North (Loan No. 5) | The largest tenant, SSM Health Care of Oklahoma, Inc. (“SSM”), has a right of first refusal pursuant to its lease to purchase the Mortgaged Property if the Mortgagor receives a bona fide offer from a third party to purchase the Mortgaged Property that Mortgagor intends to accept (the “SSM ROFR”). SSM has entered into a subordination, non-disturbance and attornment agreement in favor of the lender, providing, among other things, that the SSM ROFR does not apply to a foreclosure, deed-in-lieu of foreclosure or any other enforcement action under the Mortgage Loan documents, nor does the SSM ROFR apply to the first subsequent transfer of the Mortgaged Property following such enforcement action.
Additionally, if Mortgagor decides not to repair any damage or destruction to the Mortgaged Property such that the cost of repair is 20% or more of the then replacement cost of the Mortgaged Property, SSM has the option to purchase the Mortgaged Property for a purchase price equal to the then fair market value of the property (the SSM Purchase Option”), which SSM may exercise by providing written notice of such exercise to Mortgagor within 90 days after receipt of Mortgagor’s notice that it will not repair the damage. SSM has not entered into a subordination, non-disturbance and attornment agreement in favor of the lender with respect to the SSM Purchase Option.
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(6) Permitted Liens; Title Insurance | Walgreens-Smithfield (Loan No. 34) | The sole tenant, Walgreens, has a right of first refusal to purchase the related Mortgaged Property pursuant to the terms of its lease (the “Walgreens ROFR”) if the Mortgagor receives a bona fide third party offer to purchase the Mortgaged Property, setting forth the terms and conditions of such offer. Walgreens then has 21 days to elect to purchase the Mortgaged Property on such terms and conditions. Walgreens has entered into a subordination, non-disturbance and attornment agreement in favor of the lender, providing, among other things, that the Walgreens ROFR will not be triggered in connection with the lender’s foreclosure, a deed in lieu of foreclosure or any enforcement action; however, the Walgreens ROFR will apply to subsequent purchasers of the Mortgaged Property. | ||
(7) Junior Liens | St. Anthony’s Healthplex North (Loan No. 5) | As of the Cut-off Date, there is a mezzanine loan held by RAIT Partnership, L.P. in the outstanding principal amount of $5,000,000, which is secured directly by ownership interests in the related Mortgagor. | ||
(16) Insurance | Walgreens-Smithfield (Loan No. 34) | The mortgage loan documents do not require the Mortgagor to maintain property insurance as long as its lease with single tenant Walgreens requires Walgreens to insure (or to self-insure) the Mortgaged Property. Walgreens currently maintains such casualty and liability insurance. |
E-2-8 |
KGS-Alpha Real Estate Capital Markets, LLC
Representation | Mortgaged Property | Description of Exception | ||
(13) Actions Concerning Mortgage Loan | Butterfield Shopping Center (Loan No. 19) | The related sponsor and non-recourse carve-out guarantor is a defendant in a pending deficiency lawsuit after a foreclosure on certain investment residential property owned by the sponsor. The lender is claiming a deficiency of $708,461 plus interest accrued since the foreclosure date, and the sponsor is defending the lawsuit on the grounds that the appraised value exceeds the amount of the total debt at the time of foreclosure. | ||
(13) Actions Concerning Mortgage Loan | Chester County Multifamily Portfolio (Loan No. 36) | The related sponsor and non-recourse carve-out is currently in default under two residential loans and is subject to foreclosure proceedings on two fully recourse residential loans. At origination of the Mortgage Loan, the borrowers were required to reserve $350,000, which may be released to the borrowers after the lender receives notice that the defaulted loans have been reinstated. | ||
(24) Local Law Compliance | Butterfield Shopping Center (Loan No. 19) | The Mortgaged Property is legal non-conforming due to violations of the setback, area and density restrictions in the applicable code. If the Mortgaged Property is voluntarily razed or required by applicable law to be razed, or if the Mortgaged Property is damaged to the extent of fifty percent (50%) or more by a casualty, then the Mortgaged Property will be required to be reconstructed in conformity with the applicable regulations. Law and ordinance coverage has been obtained. | ||
(24) Local Law Compliance | Infinity Corporate Center (Loan No. 28) | The Mortgaged Property is legal non-conforming due to a parking deficiency of 54 spaces. The zoning report obtained at origination of the Mortgage Loan provides that the Mortgaged Property may be constructed after any casualty with the non-conformity, provided that the repairs or restoration are completed within one (1) year of the date of the casualty. Law and ordinance coverage has been obtained. | ||
(24) Local Law Compliance | Chester County Multifamily Portfolio (Loan No. 36) | Both Mortgaged Properties are legal non-conforming as to use and parking. The zoning report obtained at origination of the Mortgage Loan provides that nonconforming building wholly or partially destroyed by casualty or legally condemned may be reconstructed with the same non-conformities provided that (i) the reconstructed building does not exceed the prior nonconformities as to height, area, or volume of the building destroyed or condemned and (ii) the reconstruction is commenced within one year from the date the building was destroyed or condemned and shall be carried on without interruption. Law and ordinance coverage has been obtained. | ||
(28) Financial Reporting and Rent Rolls | Chester County Multifamily Portfolio (Loan No. 36) | The Mortgage Loan documents do not require the borrowers to deliver annual financial statements on a combined basis. At origination of the Mortgage Loan, the borrowers delivered a combined balance sheet with individual statements of operation. The borrowers are permitted to release one of the Mortgaged Properties in accordance with the terms and conditions of the Mortgage Loan documents. |
E-2-9 |
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ANNEX F
CLASS A-AB SCHEDULED PRINCIPAL BALANCE SCHEDULE
Distribution | Balance | Distribution | Balance | |||
8/10/2015 | $46,974,000.00 | 5/10/2020 | $46,974,000.00 | |||
9/10/2015 | $46,974,000.00 | 6/10/2020 | $46,974,000.00 | |||
10/10/2015 | $46,974,000.00 | 7/10/2020 | $46,218,388.78 | |||
11/10/2015 | $46,974,000.00 | 8/10/2020 | $45,513,360.11 | |||
12/10/2015 | $46,974,000.00 | 9/10/2020 | $44,805,702.78 | |||
1/10/2016 | $46,974,000.00 | 10/10/2020 | $44,042,086.39 | |||
2/10/2016 | $46,974,000.00 | 11/10/2020 | $43,328,942.42 | |||
3/10/2016 | $46,974,000.00 | 12/10/2020 | $42,559,996.51 | |||
4/10/2016 | $46,974,000.00 | 1/10/2021 | $41,841,325.41 | |||
5/10/2016 | $46,974,000.00 | 2/10/2021 | $41,119,974.62 | |||
6/10/2016 | $46,974,000.00 | 3/10/2021 | $40,237,302.57 | |||
7/10/2016 | $46,974,000.00 | 4/10/2021 | $39,509,967.87 | |||
8/10/2016 | $46,974,000.00 | 5/10/2021 | $38,727,237.62 | |||
9/10/2016 | $46,974,000.00 | 6/10/2021 | $37,994,271.14 | |||
10/10/2016 | $46,974,000.00 | 7/10/2021 | $37,146,945.49 | |||
11/10/2016 | $46,974,000.00 | 8/10/2021 | $36,353,788.84 | |||
12/10/2016 | $46,974,000.00 | 9/10/2021 | $35,557,683.90 | |||
1/10/2017 | $46,974,000.00 | 10/10/2021 | $34,701,592.46 | |||
2/10/2017 | $46,974,000.00 | 11/10/2021 | $33,899,345.15 | |||
3/10/2017 | $46,974,000.00 | 12/10/2021 | $33,037,287.30 | |||
4/10/2017 | $46,974,000.00 | 1/10/2022 | $32,228,852.44 | |||
5/10/2017 | $46,974,000.00 | 2/10/2022 | $31,417,412.32 | |||
6/10/2017 | $46,974,000.00 | 3/10/2022 | $30,433,363.65 | |||
7/10/2017 | $46,974,000.00 | 4/10/2022 | $29,615,246.57 | |||
8/10/2017 | $46,974,000.00 | 5/10/2022 | $28,737,517.91 | |||
9/10/2017 | $46,974,000.00 | 6/10/2022 | $27,917,369.71 | |||
10/10/2017 | $46,974,000.00 | 7/10/2022 | $27,038,361.00 | |||
11/10/2017 | $46,974,000.00 | 8/10/2022 | $26,211,897.87 | |||
12/10/2017 | $46,974,000.00 | 9/10/2022 | $25,382,363.50 | |||
1/10/2018 | $46,974,000.00 | 10/10/2022 | $24,494,237.53 | |||
2/10/2018 | $46,974,000.00 | 11/10/2022 | $23,658,319.25 | |||
3/10/2018 | $46,974,000.00 | 12/10/2022 | $22,763,992.28 | |||
4/10/2018 | $46,974,000.00 | 1/10/2023 | $21,921,643.17 | |||
5/10/2018 | $46,974,000.00 | 2/10/2023 | $21,076,163.59 | |||
6/10/2018 | $46,974,000.00 | 3/10/2023 | $20,062,564.03 | |||
7/10/2018 | $46,974,000.00 | 4/10/2023 | $19,210,173.16 | |||
8/10/2018 | $46,974,000.00 | 5/10/2023 | $18,299,845.54 | |||
9/10/2018 | $46,974,000.00 | 6/10/2023 | $17,440,902.77 | |||
10/10/2018 | $46,974,000.00 | 7/10/2023 | $16,524,210.97 | |||
11/10/2018 | $46,974,000.00 | 8/10/2023 | $15,658,668.15 | |||
12/10/2018 | $46,974,000.00 | 9/10/2023 | $14,789,908.39 | |||
1/10/2019 | $46,974,000.00 | 10/10/2023 | $13,863,680.85 | |||
2/10/2019 | $46,974,000.00 | 11/10/2023 | $12,988,248.89 | |||
3/10/2019 | $46,974,000.00 | 12/10/2023 | $12,055,540.30 | |||
4/10/2019 | $46,974,000.00 | 1/10/2024 | $11,173,387.09 | |||
5/10/2019 | $46,974,000.00 | 2/10/2024 | $10,287,954.99 | |||
6/10/2019 | $46,974,000.00 | 3/10/2024 | $9,291,833.75 | |||
7/10/2019 | $46,974,000.00 | 4/10/2024 | $8,399,406.63 | |||
8/10/2019 | $46,974,000.00 | 5/10/2024 | $7,450,189.79 | |||
9/10/2019 | $46,974,000.00 | 6/10/2024 | $6,550,916.49 | |||
10/10/2019 | $46,974,000.00 | 7/10/2024 | $5,595,049.61 | |||
11/10/2019 | $46,974,000.00 | 8/10/2024 | $4,688,879.81 | |||
12/10/2019 | $46,974,000.00 | 9/10/2024 | $3,779,341.57 | |||
1/10/2020 | $46,974,000.00 | 10/10/2024 | $2,813,503.84 | |||
2/10/2020 | $46,974,000.00 | 11/10/2024 | $1,896,993.65 | |||
3/10/2020 | $46,974,000.00 | 12/10/2024 | $924,383.70 | |||
4/10/2020 | $46,974,000.00 | 1/10/2025 | $850.29 | |||
2/10/2025 and thereafter | $0.00 |
F-1 |
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ANNEX G
st. anthony’s healthplex north mortgage loan amortization schedule
Due Date | Principal Due ($) | Interest Due ($) | Total Debt Service Due ($) | Total Ending Balance ($) |
05/01/15 | - | - | - | 30,000,000.00 |
06/01/15 | 33,399.60 | 101,654.17 | 135,053.77 | 29,966,600.40 |
07/01/15 | 37,533.20 | 98,265.48 | 135,798.68 | 29,929,067.20 |
08/01/15 | 33,692.79 | 101,413.81 | 135,106.60 | 29,895,374.41 |
09/01/15 | 33,832.05 | 101,299.65 | 135,131.70 | 29,861,542.36 |
10/01/15 | 37,953.44 | 97,920.97 | 135,874.41 | 29,823,588.92 |
11/01/15 | 34,128.77 | 101,056.40 | 135,185.17 | 29,789,460.15 |
12/01/15 | 38,241.76 | 97,684.60 | 135,926.36 | 29,751,218.39 |
01/01/16 | 34,427.90 | 100,811.18 | 135,239.08 | 29,716,790.49 |
02/01/16 | 34,570.20 | 100,694.52 | 135,264.72 | 29,682,220.29 |
03/01/16 | 42,628.35 | 94,088.52 | 136,716.87 | 29,639,591.94 |
04/01/16 | 34,889.29 | 100,432.93 | 135,322.22 | 29,604,702.65 |
05/01/16 | 38,980.79 | 97,078.75 | 136,059.54 | 29,565,721.86 |
06/01/16 | 35,194.62 | 100,182.63 | 135,377.25 | 29,530,527.24 |
07/01/16 | 39,277.49 | 96,835.52 | 136,113.01 | 29,491,249.75 |
08/01/16 | 35,502.44 | 99,930.28 | 135,432.72 | 29,455,747.31 |
09/01/16 | 35,649.18 | 99,809.98 | 135,459.16 | 29,420,098.13 |
10/01/16 | 39,719.21 | 96,473.41 | 136,192.62 | 29,380,378.92 |
11/01/16 | 35,960.70 | 99,554.60 | 135,515.30 | 29,344,418.22 |
12/01/16 | 40,021.93 | 96,225.24 | 136,247.17 | 29,304,396.29 |
01/01/17 | 36,274.77 | 99,297.13 | 135,571.90 | 29,268,121.52 |
02/01/17 | 36,424.70 | 99,174.22 | 135,598.92 | 29,231,696.82 |
03/01/17 | 48,267.93 | 89,465.23 | 137,733.16 | 29,183,428.89 |
04/01/17 | 36,774.76 | 98,887.24 | 135,662.00 | 29,146,654.13 |
05/01/17 | 40,812.99 | 95,576.74 | 136,389.73 | 29,105,841.14 |
06/01/17 | 37,095.46 | 98,624.33 | 135,719.79 | 29,068,745.68 |
07/01/17 | 41,124.62 | 95,321.26 | 136,445.88 | 29,027,621.06 |
08/01/17 | 37,418.77 | 98,359.29 | 135,778.06 | 28,990,202.29 |
09/01/17 | 37,573.43 | 98,232.50 | 135,805.93 | 28,952,628.86 |
10/01/17 | 41,589.09 | 94,940.50 | 136,529.59 | 28,911,039.77 |
11/01/17 | 37,900.64 | 97,964.26 | 135,864.90 | 28,873,139.13 |
12/01/17 | 41,907.04 | 94,679.84 | 136,586.88 | 28,831,232.09 |
01/01/18 | 38,230.51 | 97,693.83 | 135,924.34 | 28,793,001.58 |
02/01/18 | 38,388.53 | 97,564.29 | 135,952.82 | 28,754,613.05 |
03/01/18 | 50,049.05 | 88,005.09 | 138,054.14 | 28,704,564.00 |
04/01/18 | 38,754.07 | 97,264.62 | 136,018.69 | 28,665,809.93 |
05/01/18 | 42,736.36 | 93,999.97 | 136,736.33 | 28,623,073.57 |
06/01/18 | 39,090.90 | 96,988.49 | 136,079.39 | 28,583,982.67 |
07/01/18 | 43,063.67 | 93,731.64 | 136,795.31 | 28,540,919.00 |
08/01/18 | 39,430.47 | 96,710.11 | 136,140.58 | 28,501,488.53 |
09/01/18 | 39,593.45 | 96,576.50 | 136,169.95 | 28,461,895.08 |
10/01/18 | 43,552.02 | 93,331.30 | 136,883.32 | 28,418,343.06 |
11/01/18 | 39,937.11 | 96,294.77 | 136,231.88 | 28,378,405.95 |
12/01/18 | 43,885.98 | 93,057.52 | 136,943.50 | 28,334,519.97 |
01/01/19 | 40,283.59 | 96,010.73 | 136,294.32 | 28,294,236.38 |
02/01/19 | 40,450.09 | 95,874.23 | 136,324.32 | 28,253,786.29 |
03/01/19 | 51,918.80 | 86,472.28 | 138,391.08 | 28,201,867.49 |
04/01/19 | 40,831.89 | 95,561.24 | 136,393.13 | 28,161,035.60 |
05/01/19 | 44,755.46 | 92,344.73 | 137,100.19 | 28,116,280.14 |
06/01/19 | 41,185.65 | 95,271.23 | 136,456.88 | 28,075,094.49 |
07/01/19 | 45,099.22 | 92,062.91 | 137,162.13 | 28,029,995.27 |
08/01/19 | 41,542.29 | 94,978.86 | 136,521.15 | 27,988,452.98 |
09/01/19 | 41,714.00 | 94,838.10 | 136,552.10 | 27,946,738.98 |
10/01/19 | 45,612.64 | 91,642.01 | 137,254.65 | 27,901,126.34 |
11/01/19 | 42,074.95 | 94,542.19 | 136,617.14 | 27,859,051.39 |
12/01/19 | 45,963.39 | 91,354.47 | 137,317.86 | 27,813,088.00 |
01/01/20 | 42,438.84 | 94,243.88 | 136,682.72 | 27,770,649.16 |
02/01/20 | 42,614.25 | 94,100.07 | 136,714.32 | 27,728,034.91 |
03/01/20 | 50,184.53 | 87,894.02 | 138,078.55 | 27,677,850.38 |
04/01/20 | 42,997.82 | 93,785.63 | 136,783.45 | 27,634,852.56 |
05/01/20 | 46,860.19 | 90,619.29 | 137,479.48 | 27,587,992.37 |
06/01/20 | 43,369.23 | 93,481.15 | 136,850.38 | 27,544,623.14 |
07/01/20 | 47,221.11 | 90,323.41 | 137,544.52 | 27,497,402.03 |
08/01/20 | 43,743.68 | 93,174.18 | 136,917.86 | 27,453,658.35 |
09/01/20 | 43,924.48 | 93,025.96 | 136,950.44 | 27,409,733.87 |
10/01/20 | 47,760.67 | 89,881.09 | 137,641.76 | 27,361,973.20 |
11/01/20 | 44,303.44 | 92,715.29 | 137,018.73 | 27,317,669.76 |
G-1 |
Due Date | Principal Due ($) | Interest Due ($) | Total Debt Service Due ($) | Total Ending Balance ($) |
12/01/20 | 48,128.92 | 89,579.19 | 137,708.11 | 27,269,540.84 |
01/01/21 | 44,685.50 | 92,402.08 | 137,087.58 | 27,224,855.34 |
02/01/21 | 44,870.20 | 92,250.67 | 137,120.87 | 27,179,985.14 |
03/01/21 | 55,927.65 | 83,185.85 | 139,113.50 | 27,124,057.49 |
04/01/21 | 45,286.83 | 91,909.12 | 137,195.95 | 27,078,770.66 |
05/01/21 | 49,084.52 | 88,795.80 | 137,880.32 | 27,029,686.14 |
06/01/21 | 45,676.90 | 91,589.34 | 137,266.24 | 26,984,009.24 |
07/01/21 | 49,463.56 | 88,485.06 | 137,948.62 | 26,934,545.68 |
08/01/21 | 46,070.15 | 91,266.96 | 137,337.11 | 26,888,475.53 |
09/01/21 | 46,260.57 | 91,110.85 | 137,371.42 | 26,842,214.96 |
10/01/21 | 50,030.74 | 88,020.10 | 138,050.84 | 26,792,184.22 |
11/01/21 | 46,658.57 | 90,784.57 | 137,443.14 | 26,745,525.65 |
12/01/21 | 50,417.50 | 87,703.04 | 138,120.54 | 26,695,108.15 |
01/01/22 | 47,059.83 | 90,455.63 | 137,515.46 | 26,648,048.32 |
02/01/22 | 47,254.34 | 90,296.17 | 137,550.51 | 26,600,793.98 |
03/01/22 | 58,089.97 | 81,413.21 | 139,503.18 | 26,542,704.01 |
04/01/22 | 47,689.76 | 89,939.22 | 137,628.98 | 26,495,014.25 |
05/01/22 | 51,419.55 | 86,881.57 | 138,301.12 | 26,443,594.70 |
06/01/22 | 48,099.41 | 89,603.39 | 137,702.80 | 26,395,495.29 |
07/01/22 | 51,817.62 | 86,555.23 | 138,372.85 | 26,343,677.67 |
08/01/22 | 48,512.40 | 89,264.82 | 137,777.22 | 26,295,165.27 |
09/01/22 | 48,712.92 | 89,100.44 | 137,813.36 | 26,246,452.35 |
10/01/22 | 52,413.80 | 86,066.49 | 138,480.29 | 26,194,038.55 |
11/01/22 | 49,130.91 | 88,757.77 | 137,888.68 | 26,144,907.64 |
12/01/22 | 52,819.97 | 85,733.51 | 138,553.48 | 26,092,087.67 |
01/01/23 | 49,552.31 | 88,412.31 | 137,964.62 | 26,042,535.36 |
02/01/23 | 49,757.13 | 88,244.41 | 138,001.54 | 25,992,778.23 |
03/01/23 | 60,359.90 | 79,552.34 | 139,912.24 | 25,932,418.33 |
04/01/23 | 50,212.28 | 87,871.28 | 138,083.56 | 25,882,206.05 |
05/01/23 | 53,870.78 | 84,872.07 | 138,742.85 | 25,828,335.27 |
06/01/23 | 50,642.49 | 87,518.60 | 138,161.09 | 25,777,692.78 |
07/01/23 | 54,288.83 | 84,529.35 | 138,818.18 | 25,723,403.95 |
08/01/23 | 51,076.20 | 87,163.04 | 138,239.24 | 25,672,327.75 |
09/01/23 | 51,287.31 | 86,989.97 | 138,277.28 | 25,621,040.44 |
10/01/23 | 54,915.44 | 84,015.66 | 138,931.10 | 25,566,125.00 |
11/01/23 | 51,726.28 | 86,630.10 | 138,356.38 | 25,514,398.72 |
12/01/23 | 55,342.01 | 83,665.97 | 139,007.98 | 25,459,056.71 |
01/01/24 | 52,168.83 | 86,267.31 | 138,436.14 | 25,406,887.88 |
02/01/24 | 52,384.47 | 86,090.53 | 138,475.00 | 25,354,503.41 |
03/01/24 | 59,362.19 | 80,370.25 | 139,732.44 | 25,295,141.22 |
04/01/24 | 52,846.35 | 85,711.88 | 138,558.23 | 25,242,294.87 |
05/01/24 | 56,430.42 | 82,773.69 | 139,204.11 | 25,185,864.45 |
06/01/24 | 53,298.03 | 85,341.60 | 138,639.63 | 25,132,566.42 |
07/01/24 | 56,869.34 | 82,413.87 | 139,283.21 | 25,075,697.08 |
08/01/24 | 53,753.39 | 84,968.30 | 138,721.69 | 25,021,943.69 |
09/01/24 | 53,975.57 | 84,786.16 | 138,761.73 | 24,967,968.12 |
10/01/24 | 57,527.73 | 81,874.13 | 139,401.86 | 24,910,440.39 |
11/01/24 | 54,436.45 | 84,408.34 | 138,844.79 | 24,856,003.94 |
12/01/24 | 57,975.59 | 81,506.98 | 139,482.57 | 24,798,028.35 |
01/01/25 | 54,901.09 | 84,027.43 | 138,928.52 | 24,743,127.26 |
02/01/25 | 55,128.01 | 83,841.40 | 138,969.41 | 24,687,999.25 |
03/01/25 | 65,231.07 | 75,558.99 | 140,790.06 | 24,622,768.18 |
04/01/25 | 55,625.49 | 83,433.57 | 139,059.06 | 24,567,142.69 |
05/01/25 | 59,131.03 | 80,559.76 | 139,690.79 | 24,508,011.63 |
05/01/25 | 24,508,011.63 | Balloon Payment | 24,508,011.63 | - |
G-2 |
The Offered Certificates: The offered certificates will be issuable in series. The issuing entity for each series of offered certificates will be a statutory or common law trust created at our direction. Each series of offered certificates will— ● have its own series designation, and ● consist of one or more classes with various payment characteristics. No governmental agency or instrumentality will insure or guarantee payment on the offered certificates. The offered certificates will represent interests only in the issuing entity. They will not represent interests in or obligations of us, any sponsor or any of our or their respective affiliates. Neither we nor any of our affiliates are responsible for making payments on the offered certificates if collections on the related trust assets are insufficient. | The Trust Assets: The assets of each issuing entity will include— ● mortgage loans secured by first and/or junior liens on, or security interests in, various interests in commercial and multifamily real properties, ● mortgage-backed securities that directly or indirectly evidence interests in, or are directly or indirectly secured by, those types of mortgage loans, or ● some combination of those types of mortgage loans and mortgage-backed securities. Trust assets may also include cash, permitted investments, letters of credit, surety bonds, insurance policies, guarantees, reserve funds, guaranteed investment contracts, interest rate exchange agreements, interest rate cap or floor agreements and/or currency exchange agreements. |
You should carefully consider the risk factors beginning on page 19 in this prospectus, as well as those set forth in the related prospectus supplement, prior to investing. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the offered certificates or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. |
Page | ||
IMPORTANT NOTICE ABOUT THE INFORMATION PRESENTED IN THIS PROSPECTUS AND THE RELATED PROSPECTUS SUPPLEMENT | 6 | |
AVAILABLE INFORMATION | 6 | |
SUMMARY OF PROSPECTUS | 7 | |
RISK FACTORS | 19 | |
The Investment Performance of Your Offered Certificates Will Depend Upon Payments, Defaults and Losses on the Underlying Mortgage Loans; and Those Payments, Defaults and Losses May Be Highly Unpredictable | 19 | |
Repayment of a Commercial or Multifamily Mortgage Loan Depends Upon the Performance and Value of the Underlying Real Property, Which May Decline Over Time, and the Related Borrower’s Ability to Refinance the Property, of Which There Is No Assurance | 23 | |
The Various Types of Multifamily and Commercial Properties that May Secure Mortgage Loans Underlying a Series of Offered Certificates May Present Special Risks | 29 | |
Any Analysis of the Value or Income Producing Ability of a Commercial or Multifamily Property Is Highly Subjective and Subject to Error | 51 | |
Borrower Concentration Within a Trust Exposes Investors to Greater Risk of Default and Loss | 53 | |
Loan Concentration Within a Trust Exposes Investors to Greater Risk of Default and Loss | 54 | |
Geographic Concentration Within a Trust Exposes Investors to Greater Risk of Default and Loss | 54 | |
Changes in Pool Composition Will Change the Nature of Your Investment | 54 | |
The Borrower’s Form of Entity May Cause Special Risks and/or Hinder Recovery | 54 | |
Borrower Bankruptcy Proceedings Can Delay and Impair Recovery on a Mortgage Loan Underlying Your Offered Certificates | 56 | |
Environmental Liabilities Will Adversely Affect the Value and Operation of the Contaminated Property and May Deter a Lender from Foreclosing | 57 | |
Lending on Condominium Units Creates Risks for Lenders That Are Not Present When Lending on Non-Condominiums | 58 | |
Lending on Ground Leases Creates Risks for Lenders That Are Not Present When Lending on an Actual Ownership Interest in a Real Property | 59 | |
Leased Fee Properties Have Special Risks | 61 | |
Some Provisions in the Mortgage Loans Underlying Your Offered Certificates May Be Challenged as Being Unenforceable | 61 | |
Jurisdictions With One Action or Security First Rules and/or Anti-Deficiency Legislation May Limit the Ability of the Special Servicer to Foreclose on a Real Property or to Realize on Obligations Secured by a Real Property | 63 | |
Additional Secured Debt Increases the Likelihood that a Borrower Will Default on a Mortgage Loan Underlying Your Offered Certificates; Co-Lender, Intercreditor and Similar Agreements May Limit a Mortgage Lender’s Rights | 63 | |
With Respect to Certain Mortgage Loans Included in Our Trusts, the Mortgaged Property or Properties that Secure the Subject Mortgage Loan in the Trust Also Secure One or More Related Mortgage Loans That Are Not in the Trust; The Interests of the Holders of Those Non-Trust Mortgage Loans May Conflict with Your Interests. | 64 | |
Certain Aspects of Co-Lender, Intercreditor and Similar Agreements Executed in Connection with Mortgage Loans Underlying Your Offered Certificates May be Unenforceable | 65 | |
Mezzanine Debt May Reduce the Cash Flow Available to Reinvest in a Mortgaged Real Property and may Increase the Likelihood that a Borrower Will Default on a Mortgage Loan Underlying Your Offered Certificates | 65 | |
World Events and Natural Disasters Could Have an Adverse Impact on the Real Properties Securing the Mortgage Loans Underlying Your Offered Certificates and Consequently Could Reduce the Cash Flow Available to Make Payments on the Offered Certificates. | 66 | |
Lack of Insurance Coverage Exposes a Trust to Risk for Particular Special Hazard Losses | 66 | |
Changes in Zoning Laws May Adversely Affect the Use or Value of a Real Property | 67 | |
Redevelopment and Renovation at the Mortgaged Properties May Have Uncertain and Adverse Results | 67 | |
Compliance with the Americans with Disabilities Act of 1990 May Be Expensive | 67 |
Litigation and Other Legal Proceedings May Adversely Affect a Borrower’s Ability to Repay Its Mortgage Loan | 68 | |
Potential Conflicts of Interest Can Affect a Person’s Performance | 68 | |
Property Managers and Borrowers May Each Experience Conflicts of Interest in Managing Multiple Properties. | 69 | |
Adjustable Rate Mortgage Loans May Entail Greater Risks of Default to Lenders Than Fixed Rate Mortgage Loans | 69 | |
Limited Information Causes Uncertainty | 69 | |
The Risk of Terrorism in the United States and Military Action May Adversely Affect the Value of the Offered Certificates and Payments on the Mortgage Assets | 69 | |
Lack of Liquidity Will Impair Your Ability to Sell Your Offered Certificates and May Have an Adverse Effect on the Market Value of Your Offered Certificates | 70 | |
The Market Value of Your Offered Certificates May Be Adversely Affected by Factors Unrelated to the Performance of Your Offered Certificates and the Underlying Mortgage Assets, such as Fluctuations in Interest Rates and the Supply and Demand of CMBS Generally | 70 | |
The Credit Crisis and Downturn in the Real Estate Market Have Adversely Affected the Value of Commercial Mortgage-Backed Securities | 71 | |
Certain Classes of the Offered Certificates are Subordinate to, and are Therefore Riskier than, One or More Other Classes of Certificates of the Same Series | 72 | |
Payments on the Offered Certificates Will Be Made Solely from the Limited Assets of the Related Trust, and Those Assets May Be Insufficient to Make All Required Payments on Those Certificates | 72 | |
Any Credit Support for Your Offered Certificates May Be Insufficient to Protect You Against All Potential Losses | 72 | |
The Interests of Certain Certificateholders With Rights and Powers Over Certain Servicing Actions and to Cure and Purchase Certain Mortgage Loans May Be in Conflict with the Interests of the Offered Certificateholders of the Same Series | 73 | |
Bankruptcy of a Servicer May Adversely Affect Collections on the Mortgage Loans and the Ability to Replace the Servicer | 73 | |
Additional Compensation to the Master Servicer and the Special Servicer and Interest on Advances Will Affect Your Right to Receive Distributions on Your Offered Certificates | 74 | |
Inability to Replace the Master Servicer Could Affect Collections and Recoveries on the Mortgage Assets | 74 | |
Problems with Book-Entry Registration | 74 | |
Taxes on Foreclosure Property Will Reduce Amounts Available to Make Payments on the Offered Certificates | 74 | |
Changes to REMIC Restrictions on Loan Modifications May Impact an Investment in the Certificates | 75 | |
Residual Interests in a Real Estate Mortgage Investment Conduit Have Adverse Tax Consequences | 76 | |
No Gross Up in Respect of the Certificates Held by Non-U.S. Persons | 77 | |
Certain Federal Tax Considerations Regarding Original Issue Discount | 77 | |
The Nature of Ratings Are Limited and Will Not Guarantee that You Will Receive Any Projected Return on Your Offered Certificates | 77 | |
The Ratings of Your Offered Certificates May Be Lowered or Withdrawn, or Your Certificates May Receive an Unsolicited Rating, Which May Adversely Affect the Liquidity, Market Value and Regulatory Characteristics of Your Offered Certificates | 78 | |
CAPITALIZED TERMS USED IN THIS PROSPECTUS | 79 | |
THE TRUST FUND | 79 | |
Description of the Trust Assets | 79 | |
Mortgage Loans | 80 | |
Mortgage-Backed Securities | 84 | |
Acquisition, Removal and Substitution of Mortgage Assets | 85 | |
Cash, Accounts and Permitted Investments | 87 | |
Credit Support | 87 | |
Arrangements Providing Reinvestment, Interest Rate and Currency Related Protection | 88 | |
TRANSACTION PARTICIPANTS | 88 | |
The Sponsor | 88 | |
The Depositor | 89 | |
The Issuing Entity | 90 | |
The Originators | 90 |
DESCRIPTION OF THE GOVERNING DOCUMENTS | 91 | |
General | 91 | |
Assignment of Mortgage Assets | 91 | |
Representations and Warranties with Respect to Mortgage Assets | 92 | |
Collection and Other Servicing Procedures with Respect to Mortgage Loans | 92 | |
Servicing Mortgage Loans That Are Part of a Loan Combination | 95 | |
Sub-Servicers | 95 | |
Operating Advisor | 96 | |
Collection of Payments on Mortgage-Backed Securities | 96 | |
Advances | 96 | |
Matters Regarding the Master Servicer, the Special Servicer, the Manager and Us | 97 | |
Fidelity Bonds and Errors and Omissions Insurance | 99 | |
Termination Events | 99 | |
Amendment | 100 | |
List of Certificateholders | 100 | |
Eligibility Requirements for the Trustee | 100 | |
Duties of the Trustee | 101 | |
Rights, Protections, Indemnities and Immunities of the Trustee | 101 | |
Resignation and Removal of the Trustee | 102 | |
DESCRIPTION OF THE CERTIFICATES | 103 | |
General | 103 | |
Investor Requirements and Transfer Restrictions | 105 | |
Payments on the Certificates | 105 | |
Allocation of Losses and Shortfalls | 110 | |
Incorporation of Certain Documents by Reference; Reports Filed with the SEC | 110 | |
Reports to Certificateholders | 111 | |
Voting Rights | 112 | |
Termination and Redemption | 112 | |
Book-Entry Registration | 113 | |
Exchangeable Certificates | 116 | |
YIELD AND MATURITY CONSIDERATIONS | 119 | |
General | 119 | |
Pass-Through Rate | 119 | |
Payment Delays | 119 | |
Yield and Prepayment Considerations | 119 | |
Weighted Average Life and Maturity | 122 | |
Prepayment Models | 122 | |
Other Factors Affecting Yield, Weighted Average Life and Maturity | 123 | |
DESCRIPTION OF CREDIT SUPPORT | 125 | |
General | 125 | |
Subordinate Certificates | 126 | |
Overcollateralization and Excess Cash Flow | 126 | |
Letters of Credit | 126 | |
Insurance Policies, Surety Bonds and Guarantees | 127 | |
Reserve Funds | 127 | |
Credit Support with Respect to MBS | 127 | |
CERTAIN LEGAL ASPECTS OF THE MORTGAGE LOANS | 127 | |
General | 128 | |
Types of Mortgage Instruments | 128 | |
Installment Contracts | 129 | |
Leases and Rents | 130 | |
Personalty | 130 | |
Foreclosure | 130 | |
Bankruptcy Issues | 135 | |
Environmental Considerations | 141 |
Due-on-Sale and Due-on-Encumbrance Provisions | 144 | |
Junior Liens; Rights of Holders of Senior Liens | 144 | |
Subordinate Financing | 145 | |
Default Interest and Limitations on Prepayments | 145 | |
Applicability of Usury Laws | 145 | |
Americans with Disabilities Act | 146 | |
Servicemembers Civil Relief Act | 146 | |
Anti-Money Laundering, Economic Sanctions and Bribery | 147 | |
Potential Forfeiture of Assets | 147 | |
MATERIAL FEDERAL INCOME TAX CONSEQUENCES | 148 | |
General | 148 | |
REMICs | 149 | |
Taxation of Classes of Exchangeable Certificates | 176 | |
Grantor Trusts | 179 | |
Tax Return Disclosure and Investor List Requirements | 190 | |
STATE AND OTHER TAX CONSEQUENCES | 191 | |
ERISA CONSIDERATIONS | 191 | |
General | 191 | |
Plan Asset Regulations | 192 | |
Prohibited Transaction Exemptions | 193 | |
Underwriter Exemption | 193 | |
Insurance Company General Accounts | 194 | |
Ineligible Purchasers | 194 | |
Consultation with Counsel | 195 | |
Tax Exempt Investors | 195 | |
LEGAL INVESTMENT | 195 | |
USE OF PROCEEDS | 196 | |
METHOD OF DISTRIBUTION | 196 | |
LEGAL MATTERS | 198 | |
FINANCIAL INFORMATION | 198 | |
RATINGS | 198 | |
GLOSSARY | 200 |
AND THE RELATED PROSPECTUS SUPPLEMENT
● | this prospectus, which provides general information, some of which may not apply to that particular series of offered certificates; and |
● | the prospectus supplement for that particular series of offered certificates, which will describe the specific terms of those offered certificates. |
SUMMARY OF PROSPECTUS | ||||
This summary contains selected information from this prospectus. It does not contain all of the information you need to consider in making your investment decision.To understand all of the terms of a particular offering of certificates, you should read carefully this prospectus and the related prospectus supplement in full. | ||||
The Depositor | We are Citigroup Commercial Mortgage Securities Inc., the depositor with respect to each series of offered certificates. We are a special purpose Delaware corporation. Our principal offices are located at 388 Greenwich Street, New York, New York 10013. Our main telephone number is 212-816-6000. We are an indirect, wholly-owned subsidiary of Citigroup Global Markets Holdings Inc. and an affiliate of Citigroup Global Markets Inc. We will acquire the mortgage assets that are to back each series of offered certificates and transfer them to the issuing entity. See “Transaction Participants—The Depositor.” | |||
The Sponsors | Citigroup Global Markets Realty Corp., which is an affiliate of both us and Citigroup Global Markets Inc., will be a sponsor with respect to each securitization transaction involving the issuance of a series of offered certificates, unless otherwise specified in the prospectus supplement. If there are other sponsors with respect to any securitization transaction involving the issuance of a series of offered certificates, we will identify each of those sponsors and include relevant information with respect thereto in the related prospectus supplement. With respect to any securitization transaction involving the issuance of a series of offered certificates, a sponsor will be a person or entity that organizes and initiates that securitization transaction by selling or transferring assets, either directly or indirectly, including through an affiliate, to the issuing entity. See “Transaction Participants—The Sponsor.” | |||
The Issuing Entity | The issuing entity with respect to each series of offered certificates will be a statutory trust or common law trust created at our direction. Each such trust will own and hold the related mortgage assets and be the entity in whose name the subject offered certificates are issued. See “Transaction Participants—The Issuing Entity.” | |||
The Originators | Some or all of the mortgage loans backing a series of offered certificates may be originated by Citigroup Global Markets Realty Corp. or by one of our other affiliates. In addition, there may be other third-party originators of the mortgage loans backing a series of offered certificates. See “Transaction Participants—The Originators” and “Transaction Participants—The Sponsor.” We will identify in the prospectus supplement for each series of offered certificates any originator or group of affiliated originators — apart from a sponsor and/or its affiliates — that originated or is expected to originate mortgage loans | |||
representing 10% or more of the related mortgage asset pool, by balance. | |||||
The Securities Being Offered | The securities that will be offered by this prospectus and the related prospectus supplements consist of mortgage pass-through certificates. These certificates will be issued in series, and each series will, in turn, consist of one or more classes. Each class of offered certificates must, at the time of issuance, be assigned an investment grade rating by at least one nationally recognized statistical rating organization. We will identify in the related prospectus supplement or in a related free writing prospectus, with respect to each class of offered certificates, each applicable rating agency and the minimum rating to be assigned. Typically, the four highest rating categories, within which there may be sub-categories or gradations to indicate relative standing, signify investment grade. See “Ratings.” | ||||
Each series of offered certificates will evidence beneficial ownership interests in a trust established by us and containing the assets described in this prospectus and the related prospectus supplement. | |||||
The Offered Certificates May Be | |||||
Issued with Other Certificates | We may not publicly offer all the mortgage pass-through certificates evidencing interests in one of our trusts. We may elect to retain some of those certificates, to place some privately with institutional investors, to place some with investors outside the United States or to deliver some to the applicable seller as partial consideration for the related mortgage assets. In addition, some of those certificates may not satisfy the rating requirement for offered certificates described under “—The Securities Being Offered” above. | ||||
The Governing Documents | In general, a pooling and servicing agreement or other similar agreement or collection of agreements will govern, among other things— | ||||
● | the issuance of each series of offered certificates, | ||||
● | the creation of and transfer of assets to the issuing entity, and | ||||
● | the servicing and administration of those assets. | ||||
The parties to the governing document(s) for a series of offered certificates will always include us and a trustee. We will be responsible for establishing the issuing entity for each series of offered certificates. In addition, we will transfer or arrange for the transfer of the initial trust assets to each issuing entity. In general, the trustee for a series of offered certificates will be responsible for, among other things, making payments and | |||||
preparing and disseminating various reports to the holders of those offered certificates. | |||||
If the trust assets for a series of offered certificates include mortgage loans, the parties to the applicable governing document(s) will also include— | |||||
● | one or more master servicers that will generally be responsible for performing customary servicing duties with respect to those mortgage loans that are not defaulted, nonperforming or otherwise problematic in any material respect, and | ||||
● | one or more special servicers that will generally be responsible for servicing and administering (a) those mortgage loans that are defaulted, nonperforming or otherwise problematic in any material respect, including the performance of work-outs and foreclosures with respect to those mortgage loans, and (b) real estate assets acquired as part of the related trust with respect to defaulted mortgage loans. | ||||
The same person or entity, or affiliated entities, may act as both master servicer and special servicer for one of our trusts. | |||||
If the trust assets for a series of offered certificates include mortgage-backed securities, the parties to the applicable governing document(s) may also include a manager that will be responsible for performing various administrative duties with respect to those mortgage-backed securities. If the related trustee assumes those duties, however, there will be no manager. | |||||
Compensation arrangements for a trustee, master servicer, special servicer or manager for one of our trusts may vary from securitization transaction to securitization transaction. | |||||
In the related prospectus supplement, we will identify the trustee and any master servicer, special servicer or manager for each series of offered certificates and will describe their respective duties and compensation in further detail. In addition, in the related prospectus supplement, we will also identify any other material servicer responsible for making distributions to holders of a series of offered certificates, performing workouts or foreclosures, or other aspects of the servicing of a series of offered certificates or the related underlying mortgage assets upon which the performance of those offered certificates or underlying mortgage assets is materially dependent, and we will describe that servicer’s duties and compensation in further detail. See “Description of the Governing Documents.” | |||||
Any servicer, master servicer or special servicer for one of our trusts may perform any or all of its servicing duties under the | |||||
applicable governing document(s) through one or more sub-servicers. In the related prospectus supplement, we will identify any such sub-servicer that, at the time of initial issuance of the subject offered certificates, is (a) affiliated with us or with the issuing entity or any sponsor for the subject securitization transaction or (b) services 10% or more of the related mortgage assets, by balance. | |||||
Characteristics of the Mortgage Assets | The trust assets with respect to any series of offered certificates will, in general, include mortgage loans. Each of those mortgage loans will constitute the obligation of one or more persons to repay a debt. The performance of that obligation will be secured by a first or junior lien on, or security interest in, the fee, leasehold or other interest(s) of the related borrower or another person in or with respect to one or more commercial or multifamily real properties. In particular, those properties may include: | ||||
● | rental or cooperatively-owned buildings with multiple dwelling units; | ||||
● | retail properties related to the sale of consumer goods and other products, or related to providing entertainment, recreational or personal services, to the general public; | ||||
● | office buildings; | ||||
● | hospitality properties; | ||||
● | casino properties; | ||||
● | health care-related facilities; | ||||
● | industrial facilities; | ||||
● | warehouse facilities, mini-warehouse facilities and self-storage facilities; | ||||
● | restaurants, taverns and other establishments involved in the food and beverage industry; | ||||
● | manufactured housing communities, mobile home parks and recreational vehicle parks; | ||||
● | recreational and resort properties; | ||||
● | arenas and stadiums; | ||||
● | churches and other religious facilities; | ||||
● | parking lots and garages; | ||||
● | mixed use properties; | ||||
● | other income-producing properties; and/or | ||||
● | unimproved land. | ||||
The mortgage loans underlying a series of offered certificates may have a variety of payment terms. For example, any of those mortgage loans— | |||||
● | may provide for the accrual of interest at a mortgage interest rate that is fixed over its term, that resets on one or more specified dates or that otherwise adjusts from time to time; | ||||
● | may provide for the accrual of interest at a mortgage interest rate that may be converted at the borrower’s election from an adjustable to a fixed interest rate or from a fixed to an adjustable interest rate; | ||||
● | may provide for no accrual of interest; | ||||
● | may provide for level payments to stated maturity, for payments that reset in amount on one or more specified dates or for payments that otherwise adjust from time to time to accommodate changes in the mortgage interest rate or to reflect the occurrence of specified events; | ||||
● | may be fully amortizing or, alternatively, may be partially amortizing or nonamortizing, with a substantial payment of principal due on its stated maturity date; | ||||
● | may permit the negative amortization or deferral of accrued interest; | ||||
● | may prohibit some or all voluntary prepayments or require payment of a premium, fee or charge in connection with those prepayments; | ||||
● | may permit defeasance and the release of real property collateral in connection with that defeasance; | ||||
● | may provide for payments of principal, interest or both, on due dates that occur monthly, bi-monthly, quarterly, semi-annually, annually or at some other interval; and/or | ||||
● | may have two or more component parts, each having characteristics that are otherwise described in this prospectus as being attributable to separate and distinct mortgage loans. | ||||
Most, if not all, of the mortgage loans underlying a series of offered certificates will be secured by liens on real properties located in the United States, its territories and possessions. However, some of those mortgage loans may be secured by liens on real properties located outside the United States, its territories and possessions, provided that foreign mortgage loans do not represent more than 10% of the related mortgage asset pool, by balance. | |||||
Neither we nor any of our affiliates will guarantee or insure repayment of any of the mortgage loans underlying a series of offered certificates. Unless we expressly state otherwise in the related prospectus supplement, no governmental agency or instrumentality will guarantee or insure repayment of any of the mortgage loans underlying a series of offered certificates. | |||||
The trust assets with respect to any series of offered certificates may also include mortgage participations, mortgage pass-through certificates, collateralized mortgage obligations and other mortgage-backed securities, that evidence an interest in, or are secured by a pledge of, one or more mortgage loans of the type described above. We will not include a mortgage participation, mortgage pass-through certificate, collateralized mortgage obligation or other mortgage-backed security among the trust assets with respect to any series of offered certificates unless— | |||||
● | the security has been registered under the Securities Act of 1933, as amended, or | ||||
● | we would be free to publicly resell the security without registration. | ||||
In addition to the asset classes described above in this “—Characteristics of the Mortgage Assets” subsection, we may include in the trust with respect to any series of offered certificates other asset classes, provided that such other asset classes in the aggregate will not exceed 10% by principal balance of the related asset pool. | |||||
We will describe the specific characteristics of the mortgage assets underlying a series of offered certificates in the related prospectus supplement. | |||||
The trust assets with respect to a series of offered certificates will also include cash, including in the form of initial deposits and collections on the related mortgage assets and other related trust assets, bank accounts, permitted investments and, following foreclosure, acceptance of a deed in lieu of foreclosure or any other enforcement action, real property and other collateral for defaulted mortgage loans. | |||||
See “The Trust Fund.” | |||||
Acquisition, Removal and | |||||
Substitution of Mortgage Assets | We will generally acquire the mortgage assets to be included in our trusts from Citigroup Global Markets Realty Corp. or another of our affiliates or from another seller of commercial and multifamily mortgage loans. We will then transfer those mortgage assets to the issuing entity for the related securitization. | ||||
In general, the total outstanding principal balance of the mortgage assets transferred by us to any particular trust will equal or exceed the initial total outstanding principal balance of the related series of certificates. If the total outstanding principal balance of the related mortgage assets initially delivered by us to the related trustee is less than the initial total outstanding principal balance of any series of certificates, and if the subject securitization transaction contemplates a prefunding period, then we will deposit or arrange for the deposit of cash or liquid investments on an interim basis with the related trustee or such other party as is specified in the related prospectus supplement to cover the shortfall, and we will specify in the related prospectus supplement the amount of, and the percentage of the mortgage asset pool represented by, that deposit. For 90 days — or such other period as may be specified in the related prospectus supplement — following the date of initial issuance of that series of certificates, which 90-day or other period will be the prefunding period, we or such other party as is specified in the related prospectus supplement will be entitled to obtain a release of the deposited cash or investments upon delivery of a corresponding amount of mortgage assets. However, if there is a failure by us or any other applicable party to deliver mortgage assets sufficient to make up the entire shortfall by the end of the prefunding period, any of the cash or, following liquidation, investments remaining on deposit with the related trustee or other applicable party will be used to pay down the total principal balance of the related series of certificates or otherwise as described in the related prospectus supplement. If the subject securitization transaction contemplates a prefunding period, we will disclose in the related prospectus supplement any limitation on the ability to add pool assets and the requirements for mortgage assets that may be added to the related mortgage asset pool. | |||||
If so specified in the related prospectus supplement, we or another specified person or entity may be permitted, at our or its option, but subject to the conditions specified in that prospectus supplement, to acquire from the related trust particular mortgage assets underlying a series of certificates in exchange for: | |||||
● | cash that would be applied to pay down the principal balances of certificates of that series; and/or | ||||
● | other mortgage loans or mortgage-backed securities that— | |||||
1. | conform to the description of mortgage assets in this prospectus, and | |||||
2. | satisfy the criteria set forth in the related prospectus supplement. | |||||
In addition, if so specified in the related prospectus supplement, a special servicer or other specified party for one of our trusts may be obligated, under the circumstances described in that prospectus supplement, to sell on behalf of the trust a delinquent or defaulted mortgage asset. | ||||||
Further, if so specified under circumstances described in the related prospectus supplement, all or substantially all of the remaining certificateholders of a given series of certificates, acting together, may exchange those certificates for all of the mortgage loans, REO properties and mortgage-backed securities remaining in the mortgage pool underlying those certificates. | ||||||
If and to the extent described in the related prospectus supplement, we, a mortgage asset seller and/or another specified person or entity may make or assign to or for the benefit of one of our trusts various representations and warranties, or may be obligated to deliver to one of our trusts various documents, in either case relating to some or all of the mortgage assets transferred to that trust. Upon the discovery of a material breach of any such representation or warranty or a material defect with respect to those documents, in each case that is material and adverse in accordance with a standard set forth in the related prospectus supplement, we or such other party may be required, at our or its option, to either repurchase the affected mortgage asset(s) out of the related trust or to replace the affected mortgage asset(s) with other mortgage asset(s) that satisfy the criteria set forth in the related prospectus supplement. | ||||||
No replacement of mortgage assets or acquisition of new mortgage assets will be permitted if it would result in a qualification, downgrade or withdrawal of the then-current rating assigned by any rating agency to any class of affected offered certificates. | ||||||
Characteristics of | ||||||
the Offered Certificates | As more particularly described under “Description of the Certificates—General” and “—Payments on the Certificates,” an offered certificate may entitle the holder to receive: | |||||
● | payments of interest; | |||||
● | payments of principal; | |||||
● | payments of all or part of the prepayment or repayment premiums, fees and charges, equity participation payments or any other specific items or amounts received on the related mortgage assets; and/or | ||||
● | payments of residual amounts remaining after required payments have been made with respect to other classes of certificates of the same series. | ||||
Any class of offered certificates may be senior or subordinate to orpari passu with one or more other classes of certificates of the same series, including a non-offered class of certificates of that series, for purposes of some or all payments and/or allocations of losses. | |||||
A class of offered certificates may have two or more component parts, each having characteristics that are otherwise described in this prospectus as being attributable to separate and distinct classes. | |||||
Payments on a class of offered certificates may occur monthly, bi-monthly, quarterly, semi-annually or at any other specified interval, commencing on the distribution date specified in the related prospectus supplement. | |||||
We will describe the specific characteristics of each class of offered certificates in the related prospectus supplement, including the principal balance or notional amount, pass-through rate, payment characteristics and authorized denominations. Among other things, in the related prospectus supplement, we will summarize the flow of funds, payment priorities and allocations among the respective classes of offered certificates of any particular series, the respective classes of non-offered certificates of that series, and fees and expenses, to the extent necessary to understand the payment characteristics of those classes of offered certificates, and we will identify any events in the applicable governing document(s) that would alter the transaction structure or flow of funds. | |||||
If the related prospectus supplement so provides, a series of certificates may include one or more classes that are “exchangeable certificates” as described under “Description of the Certificates-Exchangeable Certificates.” | |||||
See “Description of the Certificates.” | |||||
Credit Support and Reinvestment, | |||||
Interest Rate and Currency Related | |||||
Protection for the Offered Certificates | Some classes of offered certificates may be protected in full or in part against defaults and losses, or select types of defaults and losses, on the related mortgage assets by overcollateralization and/or excess cash flow or through the subordination of one or | ||||
more other classes of certificates of the same series or by other types of credit support. The other types of credit support may include a letter of credit, a surety bond, an insurance policy, a guarantee or a reserve fund. We will describe the credit support, if any, for each class of offered certificates and, if applicable, we will identify the provider of that credit support, in the related prospectus supplement. In addition, we will summarize in the related prospectus supplement how losses not covered by credit enhancement or support will be allocated to the subject series of offered certificates. | |||||
The trust assets with respect to any series of offered certificates may also include any of the following agreements: | |||||
● | guaranteed investment contracts in accordance with which moneys held in the funds and accounts established with respect to those offered certificates will be invested at a specified rate; | ||||
● | interest rate exchange agreements, interest rate cap agreements and interest rate floor agreements; and | ||||
● | currency exchange agreements. | ||||
We will describe the types of reinvestment, interest rate and currency related protection, if any, for each class of offered certificates and, if applicable, we will identify the provider of that protection, in the related prospectus supplement. | |||||
�� | |||||
See “Risk Factors,” “The Trust Fund” and “Description of Credit Support.” | |||||
Advances with Respect | |||||
to the Mortgage Assets | If the trust assets for a series of offered certificates include mortgage loans, then, as and to the extent described in the related prospectus supplement, the related master servicer, the related special servicer, the related trustee, any related provider of credit support and/or any other specified person may be obligated to make, or may have the option of making, advances with respect to those mortgage loans to cover— | ||||
● | delinquent scheduled payments of principal and/or interest, other than balloon payments, | ||||
● | property protection expenses, | ||||
● | other servicing expenses, or | ||||
● | any other items specified in the related prospectus supplement. | ||||
Any party making advances will be entitled to reimbursement from subsequent recoveries on the related mortgage loan and as otherwise described in this prospectus or the related prospectus supplement. That party may also be entitled to receive interest on its advances for a specified period. See “Description of the Governing Documents—Advances.” | |||||
If the trust assets for a series of offered certificates include mortgage-backed securities, we will describe in the related prospectus supplement any comparable advancing obligations with respect to those mortgage-backed securities or the underlying mortgage loans. | |||||
Optional or Mandatory | |||||
Redemption or Termination | We will describe in the related prospectus supplement any circumstances in which a specified party is permitted or obligated to purchase or sell any of the mortgage assets underlying a series of offered certificates. In particular, a master servicer, special servicer or other designated party may be permitted or obligated to purchase or sell— | ||||
● | all the mortgage assets in any particular trust, thereby resulting in a termination of the trust, or | ||||
● | that portion of the mortgage assets in any particular trust as is necessary or sufficient to retire one or more classes of offered certificates of the related series. | ||||
See “Description of the Certificates—Termination and Redemption.” | |||||
Federal Income Tax Consequences | Any class of offered certificates will constitute or evidence ownership of: | ||||
● | regular interests or residual interests in a real estate mortgage investment conduit under Sections 860A through 860G of the Internal Revenue Code of 1986, as amended; or | ||||
● | interests in a grantor trust under Subpart E of Part I of Subchapter J of the Internal Revenue Code of 1986, as amended. | ||||
See “Material Federal Income Tax Consequences.” | |||||
ERISA Considerations | If you are a fiduciary or any other person investing assets of an employee benefit plan or other retirement plan or arrangement, you are encouraged to review with your legal advisor whether the purchase or holding of offered certificates could give rise to a transaction that is prohibited under the Employee Retirement Income Security Act of 1974, as amended, or the Internal | ||||
Revenue Code of 1986, as amended. See “ERISA Considerations.” | ||||
Legal Investment | We will specify in the related prospectus supplement which classes of the offered certificates, if any, will constitute mortgage related securities for purposes of the Secondary Mortgage Market Enhancement Act of 1984, as amended. If your investment activities are subject to legal investment laws and regulations, regulatory capital requirements, or review by regulatory authorities, then you may be subject to restrictions on investment in the offered certificates. You are encouraged to consult your own legal advisors to determine the suitability of and consequences to you of the purchase, ownership and sale of the offered certificates. See “Legal Investment.” | |||
Ratings | It is a condition to the issuance of any class of offered certificates that, at the time of issuance, at least one nationally recognized statistical rating organization has rated those certificates in one of its generic rating categories which signifies investment grade. Typically, the four highest rating categories, within which there may be sub-categories or gradations indicating relative standing, signify investment grade. We will, in the related prospectus supplement or in a related free writing prospectus, with respect to each class of offered certificates, identify the applicable rating agency or agencies and specify the minimum rating(s) that must be assigned thereto. See “Ratings.” | |||
● | an absolute or partial prohibition against voluntary prepayments during some or all of the loan term, or |
● | a requirement that voluntary prepayments be accompanied by some form of prepayment premium, fee or charge during some or all of the loan term. |
● | the rate of prepayments and other unscheduled collections of principal on the underlying mortgage loans being faster or slower than you anticipated, or |
● | the rate of defaults on the underlying mortgage loans being faster, or the severity of losses on the underlying mortgage loans being greater, than you anticipated. |
● | vary based on the occurrence of specified events, such as the retirement of one or more other classes of certificates of the same series, or |
● | be subject to various contingencies, such as prepayment and default rates with respect to the underlying mortgage loans. |
● | the fair market value and condition of the underlying real property; |
● | the level of interest rates; |
● | the borrower’s equity in the underlying real property; |
● | the borrower’s financial condition; |
● | occupancy levels at or near the time of refinancing; |
● | the operating history of the underlying real property; |
● | changes in zoning and tax laws; |
● | changes in competition in the relevant area; |
● | changes in rental rates in the relevant area; |
● | changes in governmental regulation and fiscal policy; |
● | prevailing general and regional economic conditions; |
● | the state of the fixed income and mortgage markets; and |
● | the availability of credit for multifamily rental or commercial properties. |
● | the sufficiency of the net operating income of the applicable real property; |
● | the market value of the applicable real property at or prior to maturity; and |
● | the ability of the related borrower to refinance or sell the applicable real property. |
● | the successful operation and value of the related mortgaged property, and |
● | the related borrower’s ability to refinance the mortgage loan or sell the related mortgaged property. |
● | the location, age, functionality, design and construction quality of the subject property; |
● | perceptions regarding the safety, convenience and attractiveness of the property; |
● | the characteristics of the neighborhood where the property is located; |
● | the degree to which the subject property competes with other properties in the area; |
● | the proximity and attractiveness of competing properties; |
● | the existence and construction of competing properties; |
● | the adequacy of the property’s management and maintenance; |
● | tenant mix and concentration; |
● | national, regional or local economic conditions, including plant closings, industry slowdowns and unemployment rates; |
● | local real estate conditions, including an increase in or oversupply of comparable commercial or residential space; |
● | demographic factors; |
● | customer confidence, tastes and preferences; |
● | retroactive changes in building codes and other applicable laws; |
● | changes in governmental rules, regulations and fiscal policies, including environmental legislation; and |
● | vulnerability to litigation by tenants and patrons. |
● | an increase in interest rates, real estate taxes and other operating expenses; |
● | an increase in the capital expenditures needed to maintain the property or make improvements; |
● | a decline in the financial condition of a major tenant and, in particular, a sole tenant or anchor tenant; |
● | an increase in vacancy rates; |
● | a decline in rental rates as leases are renewed or replaced; |
● | natural disasters and civil disturbances such as earthquakes, hurricanes, floods, eruptions, terrorist attacks or riots; and |
● | environmental contamination. |
● | the length of tenant leases; |
● | the creditworthiness of tenants; |
● | the rental rates at which leases are renewed or replaced; |
● | the percentage of total property expenses in relation to revenue; |
● | the ratio of fixed operating expenses to those that vary with revenues; and |
● | the level of capital expenditures required to maintain the property and to maintain or replace tenants. |
● | to pay for maintenance and other operating expenses associated with the property; |
● | to fund repairs, replacements and capital improvements at the property; and |
● | to service mortgage loans secured by, and any other debt obligations associated with operating, the property. |
● | a general inability to lease space; |
● | an increase in vacancy rates, which may result from tenants deciding not to renew an existing lease or discontinuing operations; |
● | an increase in tenant payment defaults or any other inability to collect rental payments; |
● | a decline in rental rates as leases are entered into, renewed or extended at lower rates; |
● | an increase in the capital expenditures needed to maintain the property or to make improvements; |
● | a decline in the financial condition and/or bankruptcy or insolvency of a significant or sole tenant; and |
● | an increase in leasing costs and/or the costs of performing landlord obligations under existing leases. |
● | the business operated by the tenants; |
● | the creditworthiness of the tenants; and |
● | the number of tenants. |
● | the unpaid rent due under the lease, without acceleration, for the period prior to the filing of the bankruptcy petition or any earlier repossession by the landlord, or surrender by the tenant, of the leased premises, plus |
● | the rent reserved by the lease, without acceleration, for the greater of one year and 15%, not to exceed three years, of the term of the lease following the filing of the bankruptcy petition or any earlier repossession by the landlord, or surrender by the tenant, of the leased premises. |
● | changes in interest rates; |
● | the availability of refinancing sources; |
● | changes in governmental regulations, licensing or fiscal policy; |
● | changes in zoning or tax laws; and |
● | potential environmental or other legal liabilities. |
● | responding to changes in the local market; |
● | planning and implementing the rental structure, including staggering durations of leases and establishing levels of rent payments; |
● | operating the property and providing building services; |
● | managing operating expenses; and |
● | ensuring that maintenance and capital improvements are carried out in a timely fashion. |
● | maintain or improve occupancy rates, business and cash flow, |
● | reduce operating and repair costs, and |
● | preserve building value. |
● | rental rates; |
● | location; |
● | type of business or services and amenities offered; and |
● | nature and condition of the particular property. |
● | offers lower rents; |
● | has lower operating costs; |
● | offers a more favorable location; or |
● | offers better facilities. |
● | the physical attributes of the property, such as its age, appearance, amenities and construction quality, in relation to competing buildings; |
● | the types of services or amenities offered at the property; |
● | the location of the property; |
● | distance from employment centers and shopping areas; |
● | the characteristics of the surrounding neighborhood, which may change over time; |
● | the rents charged for dwelling units at the property relative to the rents charged for comparable units at competing properties; |
● | the ability of management to provide adequate maintenance and insurance; |
● | the property’s reputation; |
● | the level of mortgage interest rates, which may encourage tenants to purchase rather than lease housing; |
● | the existence or construction of competing or alternative residential properties in the local market, including other apartment buildings and complexes, manufactured housing communities, mobile home parks and single-family housing; |
● | compliance with and continuance of any government housing rental subsidy programs and/or low income housing tax credit or incentive programs from which the property receives benefits; |
● | the ability of management to respond to competition; |
● | the tenant mix and whether the property is primarily occupied by workers from a particular company or type of business, personnel from a local military base or students; |
● | in the case of student housing facilities, the reliance on the financial well-being of the college or university to which it relates, competition from on-campus housing units, and the relatively higher turnover rate compared to other types of multifamily tenants; |
● | adverse local, regional or national economic conditions, which may limit the amount that may be charged for rents and may result in a reduction in timely rent payments or a reduction in occupancy levels; |
● | local factory or other large employer closings; |
● | state and local regulations, which may affect the property owner’s ability to evict tenants or to increase rent to the market rent for an equivalent apartment; |
● | the extent to which the property is subject to land use restrictive covenants or contractual covenants that require that units be rented to low income tenants; |
● | the extent to which the cost of operating the property, including the cost of utilities and the cost of required capital expenditures, may increase; |
● | whether the property is subject to any age restrictions on tenants; |
● | the extent to which increases in operating costs may be passed through to tenants; and |
● | the financial condition of the owner of the property. |
● | require written leases; |
● | require good cause for eviction; |
● | require disclosure of fees; |
● | prohibit unreasonable rules; |
● | prohibit retaliatory evictions; |
● | prohibit restrictions on a resident’s choice of unit vendors; |
● | limit the bases on which a landlord may increase rent; or |
● | prohibit a landlord from terminating a tenancy solely by reason of the sale of the owner’s building. |
● | fixed percentages, |
● | percentages of increases in the consumer price index, |
● | increases set or approved by a governmental agency, or |
● | increases determined through mediation or binding arbitration. |
● | mortgage loan payments, |
● | real property taxes, |
● | maintenance expenses, and |
● | other capital and ordinary expenses of the property. |
● | maintenance payments from the tenant/shareholders, and |
● | any rental income from units or commercial space that the cooperative corporation might control. |
● | the failure of the corporation to qualify for favorable tax treatment as a “cooperative housing corporation” each year, which may reduce the cash flow available to make debt service payments on a mortgage loan secured by cooperatively owned property; and |
● | the possibility that, upon foreclosure, if the cooperatively owned property becomes a rental property, certain units could be subject to rent control, stabilization and tenants’ rights laws, at below market rents, which may affect rental income levels and the marketability and sale proceeds of the ensuing rental property as a whole. |
● | shopping centers, |
● | factory outlet centers, |
● | malls, |
● | automotive sales and service centers, |
● | consumer oriented businesses, |
● | department stores, |
● | grocery stores, |
● | convenience stores, |
● | specialty shops, |
● | gas stations, |
● | movie theaters, |
● | fitness centers, |
● | bowling alleys, |
● | salons, and |
● | dry cleaners. |
● | the strength, stability, number and quality of the tenants; |
● | tenants’ sales; |
● | tenant mix; |
● | whether the property is in a desirable location; |
● | the physical condition and amenities of the building in relation to competing buildings; |
● | whether a retail property is anchored, shadow anchored or unanchored and, if anchored or shadow anchored, the strength, stability, quality and continuous occupancy of the anchor tenant or the shadow anchor, as the case may be, are particularly important factors; and |
● | the financial condition of the owner of the property. |
● | lower rents, |
● | grant a potential tenant a free rent or reduced rent period, |
● | improve the condition of the property generally, or |
● | make at its own expense, or grant a rent abatement to cover, tenant improvements for a potential tenant. |
● | competition from other retail properties; |
● | perceptions regarding the safety, convenience and attractiveness of the property; |
● | perceptions regarding the safety of the surrounding area; |
● | demographics of the surrounding area; |
● | the strength and stability of the local, regional and national economies; |
● | traffic patterns and access to major thoroughfares; |
● | the visibility of the property; |
● | availability of parking; |
● | the particular mixture of the goods and services offered at the property; |
● | customer tastes, preferences and spending patterns; and |
● | the drawing power of other tenants. |
● | an anchor tenant’s failure to renew its lease; |
● | termination of an anchor tenant’s lease; |
● | the bankruptcy or economic decline of an anchor tenant or a shadow anchor; |
● | the cessation of the business of a self-owned anchor or of an anchor tenant, notwithstanding its continued ownership of the previously occupied space or its continued payment of rent, as the case may be; or |
● | a loss of an anchor tenant’s ability to attract shoppers. |
● | factory outlet centers; |
● | discount shopping centers and clubs; |
● | catalogue retailers; |
● | home shopping networks and programs; |
● | internet web sites and electronic media shopping; and |
● | telemarketing. |
● | the strength, stability, number and quality of the tenants, particularly significant tenants, at the property; |
● | the physical attributes and amenities of the building in relation to competing buildings, including the condition of the HVAC system, parking and the building’s compatibility with current business wiring requirements; |
● | whether the area is a desirable business location, including local labor cost and quality, tax environment, including tax benefits, and quality of life issues, such as schools and cultural amenities; |
● | the location of the property with respect to the central business district or population centers; |
● | demographic trends within the metropolitan area to move away from or towards the central business district; |
● | social trends combined with space management trends, which may change towards options such as telecommuting or hoteling to satisfy space needs; |
● | tax incentives offered to businesses or property owners by cities or suburbs adjacent to or near where the building is located; |
● | local competitive conditions, such as the supply of office space or the existence or construction of new competitive office buildings; |
● | the quality and philosophy of building management; |
● | access to mass transportation; |
● | accessibility from surrounding highways/streets; |
● | changes in zoning laws; and |
● | the financial condition of the owner of the property. |
● | rental rates; |
● | the building’s age, condition and design, including floor sizes and layout; |
● | access to public transportation and availability of parking; and |
● | amenities offered to its tenants, including sophisticated building systems, such as fiber optic cables, satellite communications or other base building technological features. |
● | the cost and quality of labor; |
● | tax incentives; and |
● | quality of life considerations, such as schools and cultural amenities. |
● | full service hotels; |
● | resort hotels with many amenities; |
● | limited service hotels; |
● | hotels and motels associated with national or regional franchise chains; |
● | hotels that are not affiliated with any franchise chain but may have their own brand identity; and |
● | other lodging facilities. |
● | the location of the property and its proximity to major population centers or attractions; |
● | the seasonal nature of business at the property; |
● | the level of room rates relative to those charged by competitors; |
● | quality and perception of the franchise affiliation; |
● | economic conditions, either local, regional or national, which may limit the amount that can be charged for a room and may result in a reduction in occupancy levels; |
● | the existence or construction of competing hospitality properties; |
● | nature and quality of the services and facilities; |
● | financial strength and capabilities of the owner and operator; |
● | the need for continuing expenditures for modernizing, refurbishing and maintaining existing facilities; |
● | increases in operating costs, which may not be offset by increased room rates; |
● | the property’s dependence on business and commercial travelers and tourism; |
● | changes in travel patterns caused by changes in access, energy prices, labor strikes, relocation of highways, the reconstruction of additional highways or other factors; and |
● | changes in travel patterns caused by perceptions of travel safety, which perceptions can be significantly and adversely influenced by terrorist acts and foreign conflict as well as apprehension regarding the possibility of such acts or conflicts. |
● | the continued existence and financial strength of the franchisor; |
● | the public perception of the franchise service mark; and |
● | the duration of the franchise licensing agreement. |
● | location, including proximity to or easy access from major population centers; |
● | appearance; |
● | economic conditions, either local, regional or national, which may limit the amount of disposable income that potential patrons may have for gambling; |
● | the existence or construction of competing casinos; |
● | dependence on tourism; and |
● | local or state governmental regulation. |
● | providing alternate forms of entertainment, such as performers and sporting events, and |
● | offering low-priced or free food and lodging. |
● | hospitals; |
● | medical offices; |
● | skilled nursing facilities; |
● | nursing homes; |
● | congregate care facilities; and |
● | in some cases, assisted living centers and housing for seniors. |
● | statutory and regulatory changes; |
● | retroactive rate adjustments; |
● | administrative rulings; |
● | policy interpretations; |
● | delays by fiscal intermediaries; and |
● | government funding restrictions. |
● | federal and state licensing requirements; |
● | facility inspections; |
● | rate setting; |
● | disruptions in payments; |
● | reimbursement policies; |
● | audits, which may result in recoupment of payments made or withholding of payments due; |
● | laws relating to the adequacy of medical care, distribution of pharmaceuticals, use of equipment, personnel operating policies and maintenance of and additions to facilities and services; |
● | patient care liability claims, including those generated by the recent advent of the use of video surveillance, or “granny cams”, by family members or government prosecutors to monitor care and limited availability and increased costs of insurance; and |
● | shortages in staffing, increases in labor costs and labor disputes. |
● | location of the property, the desirability of which in a particular instance may depend on— |
1. | availability of labor services, |
2. | proximity to supply sources and customers, and |
3. | accessibility to various modes of transportation and shipping, including railways, roadways, airline terminals and ports; |
● | building design of the property, the desirability of which in a particular instance may depend on— |
1. | ceiling heights, |
2. | column spacing, |
3. | number and depth of loading bays, |
4. | divisibility, |
5. | floor loading capacities, |
6. | truck turning radius, |
7. | overall functionality, and |
8. | adaptability of the property, because industrial tenants often need space that is acceptable for highly specialized activities; and |
● | the quality and creditworthiness of individual tenants, because industrial properties frequently have higher tenant concentrations. |
● | building design, |
● | location and visibility, |
● | tenant privacy, |
● | efficient access to the property, |
● | proximity to potential users, including apartment complexes or commercial users, |
● | services provided at the property, such as security, |
● | age and appearance of the improvements, and |
● | quality of management. |
● | competition from facilities having businesses similar to a particular restaurant or tavern; |
● | perceptions by prospective customers of safety, convenience, services and attractiveness; |
● | the cost, quality and availability of food and beverage products; |
● | negative publicity, resulting from instances of food contamination, food-borne illness and similar events; |
● | changes in demographics, consumer habits and traffic patterns; |
● | the ability to provide or contract for capable management; and |
● | retroactive changes to building codes, similar ordinances and other legal requirements. |
● | market segment, |
● | product, |
● | price, |
● | value, |
● | quality, |
● | service, |
● | convenience, |
● | location, and |
● | the nature and condition of the restaurant facility. |
● | lower operating costs, |
● | more favorable locations, |
● | more effective marketing, |
● | more efficient operations, or |
● | better facilities. |
● | actions and omissions of any franchisor, including management practices that— |
1. | adversely affect the nature of the business, or |
2. | require renovation, refurbishment, expansion or other expenditures; |
● | the degree of support provided or arranged by the franchisor, including its franchisee organizations and third-party providers of products or services; and |
● | the bankruptcy or business discontinuation of the franchisor or any of its franchisee organizations or third-party providers. |
● | location of the manufactured housing property; |
● | the ability of management to provide adequate maintenance and insurance; |
● | the number of comparable competing properties in the local market; |
● | the age, appearance, condition and reputation of the property; |
● | whether the property is subject to any age restrictions on tenants; |
● | the quality of management; and |
● | the types of facilities and services it provides. |
● | multifamily rental properties, |
● | cooperatively-owned apartment buildings, |
● | condominium complexes, and |
● | single-family residential developments. |
● | fixed percentages, |
● | percentages of increases in the consumer price index, |
● | increases set or approved by a governmental agency, or |
● | increases determined through mediation or binding arbitration. |
● | the location and appearance of the property; |
● | the appeal of the recreational activities offered; |
● | the existence or construction of competing properties, whether or not they offer the same activities; |
● | the need to make capital expenditures to maintain, refurbish, improve and/or expand facilities in order to attract potential patrons; |
● | geographic location and dependence on tourism; |
● | changes in travel patterns caused by changes in energy prices, strikes, location of highways, construction of additional highways and similar factors; |
● | seasonality of the business, which may cause periodic fluctuations in operating revenues and expenses; |
● | sensitivity to weather and climate changes; and |
● | local, regional and national economic conditions. |
● | sporting events; |
● | musical events; |
● | theatrical events; |
● | animal shows; and/or |
● | circuses. |
● | the appeal of the particular event; |
● | the cost of admission; |
● | perceptions by prospective patrons of the safety, convenience, services and attractiveness of the arena or stadium; |
● | perceptions by prospective patrons of the safety of the surrounding area; and |
● | the alternative forms of entertainment available in the particular locale. |
● | changing local demographics; |
● | competition from other schools or cultural and educational institutions; |
● | increases in tuition and/or reductions in availability of student loans, government grants or scholarships; and |
● | reductions in education spending as a result of changes in economic conditions in the area of the school or cultural and educational institution; and poor performance by teachers, administrative staff or students; or mismanagement at the private school or cultural and educational institution. |
● | the number of rentable parking spaces and rates charged; |
● | the location of the lot or garage and, in particular, its proximity to places where large numbers of people work, shop or live; |
● | the amount of alternative parking spaces in the area; |
● | the availability of mass transit; and |
● | the perceptions of the safety, convenience and services of the lot or garage. |
● | its location, |
● | its size, |
● | the surrounding neighborhood, and |
● | local zoning laws. |
● | the successful operation of the property, and |
● | its ability to generate income sufficient to make payments on the loan. |
● | the amount of income derived or expected to be derived from the related real property collateral for a twelve-month period that is available to pay debt service on the subject mortgage loan, to |
● | the annualized payments of principal and/or interest on the subject mortgage loan and any other senior and/or pari passu loans that are secured by the related real property collateral. |
● | make the loan payments on the related mortgage loan, |
● | cover operating expenses, and |
● | fund capital improvements at any given time. |
● | some health care-related facilities, |
● | hotels and motels, |
● | recreational vehicle parks, and |
● | mini-warehouse and self-storage facilities, |
● | warehouses, |
● | retail stores, |
● | office buildings, and |
● | industrial facilities. |
● | increases in energy costs and labor costs; |
● | increases in interest rates and real estate tax rates; and |
● | changes in governmental rules, regulations and fiscal policies. |
● | the then outstanding principal balance of the mortgage loan and any other senior and/or pari passu loans that are secured by the related real property collateral, to |
● | the estimated value of the related real property based on an appraisal, a cash flow analysis, a recent sales price or another method or benchmark of valuation. |
● | the borrower has a greater incentive to perform under the terms of the related mortgage loan in order to protect that equity, and |
● | the lender has greater protection against loss on liquidation following a borrower default. |
● | the market comparison method, which takes into account the recent resale value of comparable properties at the date of the appraisal; |
● | the cost replacement method, which takes into account the cost of replacing the property at the date of the appraisal; |
● | the income capitalization method, which takes into account the property’s projected net cash flow; or |
● | a selection from the values derived from the foregoing methods. |
● | it is often difficult to find truly comparable properties that have recently been sold; |
● | the replacement cost of a property may have little to do with its current market value; and |
● | income capitalization is inherently based on inexact projections of income and expense and the selection of an appropriate capitalization rate and discount rate. |
● | the operation of all of the related real properties, and |
● | the ability of those properties to produce sufficient cash flow to make required payments on the related mortgage loans. |
● | any adverse economic developments that occur in the locale, state or region where the properties are located; |
● | changes in the real estate market where the properties are located; |
● | changes in governmental rules and fiscal policies in the governmental jurisdiction where the properties are located; and |
● | acts of nature, including floods, tornadoes and earthquakes, in the areas where properties are located. |
● | operating entities with businesses distinct from the operation of the property with the associated liabilities and risks of operating an ongoing business; and |
● | individuals that have personal liabilities unrelated to the property. |
● | grant a debtor a reasonable time to cure a payment default on a mortgage loan; |
● | reduce monthly payments due under a mortgage loan; |
● | change the rate of interest due on a mortgage loan; or |
● | otherwise alter a mortgage loan’s repayment schedule. |
● | as to the degree of environmental testing conducted at any of the real properties securing the mortgage loans that back your offered certificates; |
● | that the environmental testing conducted by or on behalf of the applicable originators or any other parties in connection with the origination of those mortgage loans or otherwise identified all adverse environmental conditions and risks at the related real properties; |
● | that the results of the environmental testing were accurately evaluated in all cases; |
● | that the related borrowers have implemented or will implement all operations and maintenance plans and other remedial actions recommended by any environmental consultant that may have conducted testing at the related real properties; or |
● | that the recommended action will fully remediate or otherwise address all the identified adverse environmental conditions and risks. |
● | tenants at the property, such as gasoline stations or dry cleaners, or |
● | conditions or operations in the vicinity of the property, such as leaking underground storage tanks at another property nearby. |
● | agents or employees of the lender are deemed to have participated in the management of the borrower, or |
● | the lender actually takes possession of a borrower’s property or control of its day-to-day operations, including through the appointment of a receiver or foreclosure. |
● | to disclose to potential residents or purchasers information in their possession regarding the presence of known lead-based paint or lead-based paint-related hazards in such housing, and |
● | to deliver to potential residents or purchasers a United States Environmental Protection Agency approved information pamphlet describing the potential hazards to pregnant women and young children, including that the ingestion of lead-based paint chips and/or the inhalation of dust particles from lead-based paint by children can cause permanent injury, even at low levels of exposure. |
● | the related borrower’s interest in a commercial condominium unit or multiple units in a residential condominium project, and |
● | the related voting rights in the owners’ association for the subject building, development or project. |
● | the bankrupt party— |
1. | was insolvent at the time of granting the lien, |
2. | was rendered insolvent by the granting of the lien, |
3. | was left with inadequate capital, or |
4. | was not able to pay its debts as they matured; and |
● | the bankrupt party did not, when it allowed its property to be encumbered by a lien securing the other borrower’s loan, receive fair consideration or reasonably equivalent value for pledging its property for the equal benefit of the other borrower. |
● | the related real property, or |
● | a majority ownership interest in the related borrower. |
● | grants any such other mortgage lender cure rights and/or a purchase option with respect to the subject underlying mortgage loan under certain default scenarios or reasonably foreseeable default scenarios; |
● | limits modifications of the payment terms of the subject underlying mortgage loan; and or |
● | limits or delays enforcement actions with respect to the subject underlying mortgage loan. |
● | grants the mezzanine lender cure rights and/or a purchase option with respect to the subject underlying mortgage loan under certain default scenarios or reasonably foreseeable default scenarios; |
● | limits modifications of payment terms of the subject underlying mortgage loan; and/or |
● | limits or delays enforcement actions with respect to the subject underlying mortgage loan. |
● | war, |
● | riot, strike and civil commotion, |
● | terrorism, |
● | nuclear, biological or chemical materials, |
● | revolution, |
● | governmental actions, |
● | floods and other water-related causes, |
● | earth movement, including earthquakes, landslides and mudflows, |
● | wet or dry rot, |
● | mold, |
● | vermin, and |
● | domestic animals. |
● | breach of contract involving a tenant, a supplier or other party; |
● | negligence resulting in a personal injury, or |
● | responsibility for an environmental problem. |
● | the real properties may be managed by property managers that are affiliated with the related borrowers; |
● | the property managers also may manage additional properties, including properties that may compete with those real properties; or |
● | affiliates of the property managers and/or the borrowers, or the property managers and/or the borrowers themselves, also may own other properties, including properties that may compete with those real properties. |
● | the availability of alternative investments that offer higher yields or are perceived as being a better credit risk, having a less volatile market value or being more liquid, |
● | legal and other restrictions that prohibit a particular entity from investing in commercial mortgage-backed securities or limit the amount or types of commercial mortgage-backed securities that it may acquire, |
● | investors’ perceptions regarding the commercial and multifamily real estate markets, which may be adversely affected by, among other things, a decline in real estate values or an increase in defaults and foreclosures on mortgage loans secured by income-producing properties, and |
● | investors’ perceptions regarding the capital markets in general, which may be adversely affected by political, social and economic events completely unrelated to the commercial and multifamily real estate markets. |
● | the payment priorities of the respective classes of the certificates of the same series, |
● | the order in which the principal balances of the respective classes of the certificates of the same series with balances will be reduced in connection with losses and default-related shortfalls, and |
● | the characteristics and quality of the mortgage loans in the related trust. |
● | you will be able to exercise your rights as a certificateholder only indirectly through the Depository Trust Company and its participating organizations; |
● | you may have only limited access to information regarding your offered certificates; |
● | you may suffer delays in the receipt of payments on your offered certificates; and |
● | your ability to pledge or otherwise take action with respect to your offered certificates may be limited due to the lack of a physical certificate evidencing your ownership of those certificates. |
● | any net income from that operation and management that does not consist of qualifying rents from real property within the meaning of Section 856(d) of the Internal Revenue Code of 1986, as amended, and |
● | any rental income based on the net profits of a tenant or sub-tenant or allocable to a service that is non-customary in the area and for the type of building involved. |
● | generally will not be reduced by losses from other activities, |
● | for a tax-exempt holder, will be treated as unrelated business taxable income, and |
● | for a foreign holder, will not qualify for any exemption from withholding tax. |
● | individuals, |
● | estates, |
● | trusts beneficially owned by any individual or estate, and |
● | pass-through entities having any individual, estate or trust as a shareholder, member or partner. |
● | a foreign person under the Internal Revenue Code, or |
● | an entity that is classified as a U.S. partnership under the Internal Revenue Code if any of its partners, directly or indirectly (other than through a U.S. corporation) is (or is permitted to be under the partnership agreement) a foreign person under the Internal Revenue Code, or |
● | a foreign permanent establishment or fixed base (within the meaning of an applicable income tax treaty) of a U.S. person. |
● | principal prepayments on the related mortgage loans will be made; |
● | the degree to which the rate of such prepayments might differ from that originally anticipated; or |
● | the likelihood of early optional termination of the trust. |
● | various types of multifamily and/or commercial mortgage loans; |
● | mortgage participations, pass-through certificates, collateralized mortgage obligations or other mortgage-backed securities that directly or indirectly evidence interests in, or are secured by pledges of, one or more of various types of multifamily and/or commercial mortgage loans; or |
● | a combination of mortgage loans and mortgage-backed securities of the types described above. |
● | rental or cooperatively-owned buildings with multiple dwelling units; |
● | retail properties related to the sale of consumer goods and other products to the general public, such as shopping centers, malls, factory outlet centers, automotive sales centers, department stores and other retail stores, grocery stores, specialty shops, convenience stores and gas stations; |
● | retail properties related to providing entertainment, recreational and personal services to the general public, such as movie theaters, fitness centers, bowling alleys, salons, dry cleaners and automotive service centers; |
● | office properties; |
● | hospitality properties, such as hotels, motels and other lodging facilities; |
● | casino properties; |
● | health care-related properties, such as hospitals, skilled nursing facilities, nursing homes, congregate care facilities and, in some cases, assisted living centers and senior housing; |
● | industrial properties; |
● | warehouse facilities, mini-warehouse facilities and self-storage facilities; |
● | restaurants, taverns and other establishments involved in the food and beverage industry; |
● | manufactured housing communities, mobile home parks and recreational vehicle parks; |
● | recreational and resort properties, such as golf courses, marinas, ski resorts and amusement parks; |
● | arenas and stadiums; |
● | churches and other religious facilities; |
● | parking lots and garages; |
● | mixed use properties; |
● | other income-producing properties; and |
● | unimproved land. |
● | a fee interest or estate, which consists of ownership of the property for an indefinite period, |
● | an estate for years, which consists of ownership of the property for a specified period of years, |
● | a leasehold interest or estate, which consists of a right to occupy and use the property for a specified period of years, subject to the terms and conditions of a lease, |
● | shares in a cooperative corporation which owns the property, or |
● | any other real estate interest under applicable local law. |
● | first, to the payment of court costs and fees in connection with the foreclosure, |
● | second, to the payment of real estate taxes, and |
● | third, to the payment of any and all principal, interest, prepayment or acceleration penalties, and other amounts owing to the holder of the senior loans. |
● | the period of the delinquency, |
● | any forbearance arrangement then in effect, |
● | the condition of the related real property, and |
● | the ability of the related real property to generate income to service the mortgage debt. |
● | an original term to maturity of not more than approximately 40 years; and |
● | scheduled payments of principal, interest or both, to be made on specified dates, that occur monthly, bi-monthly, quarterly, semi-annually, annually or at some other interval. |
● | provide for the accrual of interest at a mortgage interest rate that is fixed over its term, that resets on one or more specified dates or that otherwise adjusts from time to time; |
● | provide for the accrual of interest at a mortgage interest rate that may be converted at the borrower’s election from an adjustable to a fixed interest rate or from a fixed to an adjustable interest rate; |
● | provide for no accrual of interest; |
● | provide for level payments to stated maturity, for payments that reset in amount on one or more specified dates or for payments that otherwise adjust from time to time to accommodate changes in the coupon rate or to reflect the occurrence of specified events; |
● | be fully amortizing or, alternatively, may be partially amortizing or nonamortizing, with a substantial payment of principal due on its stated maturity date; |
● | permit the negative amortization or deferral of accrued interest; |
● | permit defeasance and the release of the real property collateral in connection with that defeasance; and/or |
● | prohibit some or all voluntary prepayments or require payment of a premium, fee or charge in connection with those prepayments. |
● | the total outstanding principal balance and the largest, smallest and average outstanding principal balance of the mortgage loans; |
● | the type or types of property that provide security for repayment of the mortgage loans; |
● | the earliest and latest origination date and maturity date of the mortgage loans; |
● | the original and remaining terms to maturity of the mortgage loans, or the range of each of those terms to maturity, and the weighted average original and remaining terms to maturity of the mortgage loans; |
● | loan-to-value ratios of the mortgage loans either at origination or as of a more recent date, or the range of those loan-to-value ratios, and the weighted average of those loan-to-value ratios; |
● | the mortgage interest rates of the mortgage loans, or the range of those mortgage interest rates, and the weighted average mortgage interest rate of the mortgage loans; |
● | if any mortgage loans have adjustable mortgage interest rates, the index or indices upon which the adjustments are based, the adjustment dates, the range of gross margins and the weighted average gross margin, and any limits on mortgage interest rate adjustments at the time of any adjustment and over the life of the loan; |
● | information on the payment characteristics of the mortgage loans, including applicable prepayment restrictions; |
● | debt service coverage ratios of the mortgage loans either at origination or as of a more recent date, or the range of those debt service coverage ratios, and the weighted average of those debt service coverage ratios; and |
● | the geographic distribution of the properties securing the mortgage loans on a state-by-state basis. |
● | more general information in the related prospectus supplement, and |
● | specific information in a report which will be filed with the SEC as part of a Current Report on Form 8-K following the issuance of those certificates. |
● | mortgage participations, mortgage pass-through certificates, collateralized mortgage obligations or other mortgage-backed securities that are not insured or guaranteed by any governmental agency or instrumentality, or |
● | certificates issued and/or insured or guaranteed by Freddie Mac, Fannie Mae, Ginnie Mae, Farmer Mac, or another federal or state governmental agency or instrumentality. |
● | will have been registered under the Securities Act, or |
● | will be exempt from the registration requirements of that Act, or |
● | will have been held for at least the holding period specified in Rule 144(d) under that Act, or |
● | may otherwise be resold by us publicly without registration under that Act. |
● | the initial and outstanding principal amount(s) and type of the securities; |
● | the original and remaining term(s) to stated maturity of the securities; |
● | the pass-through or bond rate(s) of the securities or the formula for determining those rate(s); |
● | the payment characteristics of the securities; |
● | the identity of the issuer(s), servicer(s) and trustee(s) for the securities; |
● | a description of the related credit support, if any; |
● | the type of mortgage loans underlying the securities; |
● | the circumstances under which the related underlying mortgage loans, or the securities themselves, may be purchased prior to maturity; |
● | the terms and conditions for substituting mortgage loans backing the securities; and |
● | the characteristics of any agreements or instruments providing interest rate protection to the securities. |
● | the term or duration of the prefunding period; |
● | the amount of proceeds to be deposited in the prefunding account and the percentage of the mortgage asset pool represented by those proceeds; |
● | triggers or events that would trigger limits on or terminate the prefunding period and the effects of such triggers; |
● | when and how new mortgage assets may be acquired during the prefunding period, and any limitation on the ability to add mortgage assets; |
● | the acquisition or underwriting criteria for additional mortgage assets to be acquired during the prefunding period; |
● | which party has the authority to add mortgage assets or determine if proposed additional mortgage assets meet the acquisition or underwriting criteria for adding mortgage assets; |
● | any requirements to add minimum amounts of mortgage assets and any effects of not meeting those requirements; |
● | if applicable, the procedures and standards for the temporary investment of funds in the prefunding account pending use and a description of the financial products or instruments eligible for the prefunding account; and |
● | the circumstances under which funds in a prefunding account will be distributed to certificateholders or otherwise disposed of. |
● | cash that would be applied to pay down the principal balances of the certificates of that series; and/or |
● | other mortgage loans or mortgage-backed securities that— |
1. | conform to the description of mortgage assets in this prospectus, and |
2. | satisfy the criteria set forth in the related prospectus supplement. |
● | overcollateralization and/or excess cash flow; |
● | the subordination of one or more other classes of certificates of the same series; |
● | a letter of credit; |
● | a surety bond; |
● | an insurance policy; |
● | a guarantee; and/or |
● | a reserve fund. |
● | interest rate exchange agreements; |
● | interest rate cap agreements; |
● | interest rate floor agreements; or |
● | currency exchange agreements. |
● | acquiring, holding, transferring and assigning mortgage loans, or interests in those loans; |
● | acquiring, holding, transferring and assigning mortgage-backed securities that evidence interests in mortgage loans; |
● | authorizing, issuing, selling and delivering bonds or other evidence of indebtedness that are secured by a pledge or other assignment of real properties, mortgage loans, mortgage-backed securities, reserve funds, guaranteed investment contracts, letters of credit, insurance contracts, surety bonds or any other credit enhancement device or interest rate or currency protection device; |
● | acting as depositor of one or more trusts formed to issue, sell and deliver bonds or certificates of interest that are secured by a pledge or assignment of, or represent interests in, pools of mortgage loans and mortgage-backed securities; and |
● | doing all such things as are reasonable or necessary to enable us to carry out any of the above, including entering into loan agreements, servicing agreements and reimbursements agreements and selling certificates of interest in any trust for which we serve as depositor. |
● | to remove the trustee upon the occurrence of certain specified events, including certain events of bankruptcy or insolvency, failure to deliver certain required reports or failure to make certain distributions to the certificateholders required pursuant to the related Governing Document, and thereupon appoint a successor trustee; |
● | to appoint a successor trustee in the event the trustee resigns, is removed or becomes ineligible to continue serving in such capacity under the related Governing Document; |
● | to provide the trustee, the master servicer or the special servicer with any reports, certifications and information, other than with respect to the mortgage loans, that it may reasonably require to comply with the terms of the related Governing Document; and |
● | to provide to the related tax administrator in respect of the related trust such information as it may reasonably require to perform its reporting and other tax compliance obligations under the related Governing Document. |
● | in the case of a mortgage loan— |
1. | the address of the related real property, |
2. | the mortgage interest rate and, if applicable, the applicable index, gross margin, adjustment date and any rate cap information, |
3. | the remaining term to maturity, the maturity date or the anticipated repayment date, and |
4. | the outstanding principal balance; and |
● | in the case of a mortgage-backed security— |
1. | the outstanding principal balance, and |
2. | the pass-through rate or coupon rate. |
● | the accuracy of the information set forth for each mortgage asset on the schedule of mortgage assets appearing as an exhibit to the Governing Document for that series; |
● | the warranting party’s title to each mortgage asset and the authority of the warranting party to sell that mortgage asset; and |
● | in the case of a mortgage loan— |
1. | the enforceability of the related mortgage note and mortgage, |
2. | the existence of title insurance insuring the lien priority of the related mortgage, and |
3. | the payment status of the mortgage loan. |
● | maintaining escrow or impound accounts for the payment of taxes, insurance premiums, ground rents and similar items, or otherwise monitoring the timely payment of those items; |
● | ensuring that the related properties are properly insured; |
● | attempting to collect delinquent payments; |
● | supervising foreclosures; |
● | negotiating modifications; |
● | responding to borrower requests for partial releases of the encumbered property, easements, consents to alteration or demolition and similar matters; |
● | protecting the interests of certificateholders with respect to senior lienholders; |
● | conducting inspections of the related real properties on a periodic or other basis; |
● | collecting and evaluating financial statements for the related real properties; |
● | managing or overseeing the management of real properties acquired on behalf of the trust through foreclosure, deed-in-lieu of foreclosure or otherwise; and |
● | maintaining servicing records relating to mortgage loans in the trust. |
● | mortgage loans that are delinquent with respect to a specified number of scheduled payments; |
● | mortgage loans as to which there is a material non-monetary default; |
● | mortgage loans as to which the related borrower has— |
1. | entered into or consented to bankruptcy, appointment of a receiver or conservator or similar insolvency proceeding, or |
2. | become the subject of a decree or order for such a proceeding which has remained in force undischarged or unstayed for a specified number of days; and |
● | real properties acquired as part of the trust with respect to defaulted mortgage loans. |
● | make the initial determination of appropriate action, |
● | evaluate the success of corrective action, |
● | develop additional initiatives, |
● | institute foreclosure proceedings and actually foreclose, or |
● | accept a deed to a real property in lieu of foreclosure, on behalf of the certificateholders of the related series, |
● | performing property inspections and collecting, and |
● | evaluating financial statements. |
● | continuing to receive payments on the mortgage loan, |
● | making calculations with respect to the mortgage loan, and |
● | making remittances and preparing reports to the related trustee and/or certificateholders with respect to the mortgage loan. |
● | that mortgage-backed security will be registered in the name of the related trustee or its designee; |
● | the related trustee will receive payments on that mortgage-backed security; and |
● | subject to any conditions described in the related prospectus supplement, the related trustee or a designated manager will, on behalf and at the expense of the trust, exercise all rights and remedies with respect to that mortgaged-backed security, including the prosecution of any legal action necessary in connection with any payment default. |
● | delinquent payments of principal and/or interest, other than balloon payments, |
● | property protection expenses, |
● | other servicing expenses, or |
● | any other items specified in the related prospectus supplement. |
● | subsequent recoveries on the related mortgage loans, including amounts drawn under any fund or instrument constituting credit support, and |
● | any other specific sources identified in the related prospectus supplement. |
● | periodically from general collections on the mortgage assets in the related trust, prior to any payment to the related series of certificateholders, or |
● | at any other times and from any sources as we may describe in the related prospectus supplement. |
● | the appointment of, and the acceptance of that appointment by, a successor to the resigning party and receipt by the related trustee of written confirmation from each applicable rating agency that the resignation and appointment will not result in a withdrawal or downgrade of any rating assigned by that rating agency to any class of certificates of the related series, or |
● | a determination that those obligations are no longer permissible under applicable law or are in material conflict by reason of applicable law with any other activities carried on by the resigning party. |
● | willful misfeasance, bad faith or gross negligence in the performance of obligations or duties under the related Governing Document for any series of offered certificates, or |
● | reckless disregard of those obligations and duties. |
● | specifically required to be borne by the relevant party, without right of reimbursement, under the terms of that Governing Document; |
● | incurred in connection with any breach on the part of the relevant party of a representation or warranty made in that Governing Document; or |
● | incurred by reason of willful misfeasance, bad faith or gross negligence in the performance of, or reckless disregard of, obligations or duties on the part of the relevant party under that Governing Document. |
● | the action is related to the respective responsibilities of that party under the Governing Document for the affected series of offered certificates; and |
● | either— |
1. | that party is specifically required to bear the expense of the action, or |
2. | the action will not, in its opinion, involve that party in any ultimate expense or liability for which it would not be reimbursed under the Governing Document for the affected series of offered certificates. |
● | into which we or any related master servicer, special servicer or manager may be merged or consolidated, or |
● | resulting from any merger or consolidation to which we or any related master servicer, special servicer or manager is a party, or |
● | succeeding to all or substantially all of our business or the business of any related master servicer, special servicer or manager, |
● | be authorized under those laws to exercise trust powers; |
● | with limited exception, have a combined capital and surplus of at least $50,000,000; and |
● | be subject to supervision or examination by federal or state authority. |
● | make any representation as to the validity or sufficiency of those certificates, the related Governing Document or any underlying mortgage asset or related document, or |
● | be accountable for the use or application by or on behalf of any other party to the related Governing Document of any funds paid to that party with respect to those certificates or the underlying mortgage assets. |
● | the trustee ceases to be eligible to act in that capacity under the related Governing Document and fails to resign after we or the master servicer make a written request for the trustee to resign, or |
● | the trustee becomes incapable of acting in that capacity under the related Governing Document, or is adjudged bankrupt or insolvent, or a receiver of the trustee or of its property is appointed, or any public officer takes charge or control of the trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, |
● | have the same series designation; |
● | were issued under the same Governing Document; and |
● | represent beneficial ownership interests in the same trust. |
● | have the same class designation; and |
● | have the same payment terms. |
● | a stated principal amount, which will be represented by its principal balance, if any; |
● | interest on a principal balance or notional amount, at a fixed, floating, adjustable or variable pass-through rate, which pass-through rate may change as of a specified date or upon the occurrence of specified events as described in the related prospectus supplement; |
● | specified, fixed or variable portions of the interest, principal or other amounts received on the related mortgage assets; |
● | payments of principal, with disproportionate, nominal or no payments of interest; |
● | payments of interest, with disproportionate, nominal or no payments of principal; |
● | payments of interest on a deferred or partially deferred basis, which deferred interest may be added to the principal balance, if any, of the subject class of offered certificates or which deferred interest may or may not itself accrue interest, all as set forth in the related prospectus supplement; |
● | payments of interest or principal that commence only as of a specified date or only after the occurrence of specified events, such as the payment in full of the interest and principal outstanding on one or more other classes of certificates of the same series; |
● | payments of interest or principal that are, in whole or in part, calculated based on or payable specifically or primarily from payments or other collections on particular related mortgage assets; |
● | payments of principal to be made, from time to time or for designated periods, at a rate that is— |
1. | faster and, in some cases, substantially faster, or |
2. | slower and, in some cases, substantially slower, |
● | payments of principal to be made, subject to available funds, based on a specified principal payment schedule or other methodology; |
● | payments of principal that may be accelerated or slowed in response to a change in the rate of principal payments on the related mortgage assets in order to protect the subject class of offered certificates or, alternatively, to protect one or more other classes of certificates of the same series from prepayment and/or extension risk; |
● | payments of principal out of amounts other than payments or other collections of principal on the related mortgage assets, such as excess spread on the related mortgage assets or amounts otherwise payable as interest with respect to another class of certificates of the same series, which other class of certificates provides for the deferral of interest payments thereon; |
● | payments of residual amounts remaining after required payments have been made with respect to other classes of certificates of the same series; or |
● | payments of all or part of the prepayment or repayment premiums, fees and charges, equity participation payments or other specified items or amounts received on the related mortgage assets. |
● | the frequency of distributions on, and the periodic distribution date for, that series, |
● | the relevant collection period, which may vary from mortgage asset to mortgage asset, for payments and other collections on or with respect to the related mortgage assets that are payable on that series on any particular distribution date; and |
● | the record date as of which certificateholders entitled to payments on any particular distribution date will be established. |
● | by wire transfer of immediately available funds to the account of that holder at a bank or similar entity, provided that the holder has furnished the party making the payments with wiring instructions no later than the applicable record date or, in most cases, a specified number of days—generally not more than five—prior to that date, and has satisfied any other conditions specified in the related prospectus supplement, or |
● | by check mailed to the address of that holder as it appears in the certificate register, in all other cases. |
● | the flow of funds for the transaction, including the payment allocations, rights and distribution priorities among all classes of the subject offered certificates, and within each class of those offered certificates, with respect to cash flows; |
● | any specified changes to the transaction structure that would be triggered upon a default or event of default on the related trust assets or the failure to make any required payment on any class of certificates of the subject series, such as a change in distribution priority among classes; |
● | any credit enhancement or other support and any other structural features designed to enhance credit, facilitate the timely payment of monies due on the mortgage assets or owing to certificateholders, adjust the rate of return on those offered certificates, or preserve monies that will or might be distributed to certificateholders; |
● | how cash held pending distribution or other uses is held and invested, the length of time cash will be held pending distributions to certificateholders, the identity of the party or parties with access to cash balances and the authority to invest cash balances, the identity of the party or parties making decisions regarding the deposit, transfer or disbursement of mortgage asset cash flows and whether there will be any independent verification of the transaction accounts or account activity; and |
● | an itemized list (in tabular format) of fees and expenses to be paid or payable out of the cash flows from the related mortgage assets. |
● | a specified fixed rate; |
● | a rate based on the interest rate for a particular related mortgage asset; |
● | a rate based on a weighted average of the interest rates for some or all of the related mortgage assets, except that for purposes of calculating that weighted average rate any or all of the underlying rates may first be subject to a cap or floor or be increased or decreased by a specified spread or percentage or by a spread or percentage calculated based on a specified formula, with any such underlying rate adjustments permitted to vary from mortgage asset to mortgage asset or, in the case of any particular mortgage asset, from one accrual or payment period to another; |
● | a rate that resets periodically based upon, and that varies either directly or indirectly with, the value from time to time of a designated objective index, such as the London interbank offered rate, a particular prime lending rate, a particular Treasury rate, the average cost of funds of one or more financial institutions or other similar index rate, as determined from time to time as set forth in the related prospectus supplement; |
● | a rate that is equal to the product of (a) a rate described in any of the foregoing bullets in this sentence, multiplied by (b) a specified percentage or a percentage calculated based on a specified formula, which specified percentage or specified formula may vary from one accrual or payment period to another; |
● | a rate that is equal to (a) a rate described in any of the foregoing bullets in this sentence, increased or decreased by (b) a specified spread or a spread calculated based on a specified formula, which specified spread or specified formula may vary from one accrual or payment period to another; |
● | a floating, adjustable or otherwise variable rate that is described in any of the foregoing bullets in this sentence, except that it is limited by (a) a cap or ceiling that establishes either a maximum rate or a maximum number of basis points by which the rate may increase from one accrual or payment period to another or over the life of the subject offered certificates or (b) a floor that establishes either a minimum rate or a maximum number of basis points by which the rate may decrease from one accrual or payment period to another or over the life of the subject offered certificates; |
● | a rate that is described in any of the foregoing bullets in this sentence, except that it is subject to a limit on the amount of interest to be paid on the subject offered certificates in any accrual or payment period that is based on the total amount available for distribution; |
● | the highest, lowest or average of any two or more of the rates described in the foregoing bullets in this sentence, or the differential between any two of the rates described in the foregoing bullets in this sentence; or |
● | a rate that is based on (a) one fixed rate during one or more accrual or payment periods and a different fixed rate or rates, or any other rate or rates described in any of the foregoing bullets in this sentence, during other accrual or payment periods or (b) a floating, adjustable or otherwise variable rate described in any of the foregoing bullets in this sentence, during one or more accrual |
or payment periods and a fixed rate or rates, or a different floating, adjustable or otherwise variable rate or rates described in any of the foregoing bullets in this sentence, during other accrual or payment periods. |
● | a 360-day year consisting of 12 30-day months, |
● | the actual number of days elapsed during each relevant period in a year assumed to consist of 360 days, |
● | the actual number of days elapsed during each relevant period in a normal calendar year, or |
● | any other method identified in the related prospectus supplement. |
● | based on the principal balances of some or all of the related mortgage assets; or |
● | equal to the total principal balances of one or more other classes of certificates of the same series. |
● | payments of principal actually made to the holders of that class, and |
● | if and to the extent that we so specify in the related prospectus supplement, losses of principal on the related mortgage assets that are allocated to or are required to be borne by that class. |
● | amounts attributable to interest accrued but not currently payable on one or more other classes of certificates of the applicable series; |
● | interest received or advanced on the underlying mortgage assets that is in excess of the interest currently accrued on the certificates of the applicable series; |
● | prepayment premiums, fees and charges, payments from equity participations or any other amounts received on the underlying mortgage assets that do not constitute interest or principal; or |
● | any other amounts described in the related prospectus supplement. |
● | by reducing the entitlements to interest and/or the total principal balances of one or more of those classes; and/or |
● | by establishing a priority of payments among those classes. |
● | Reports on Form 8-K (Current Report), following the issuance of the series of certificates of the related trust fund, including as Exhibits to the Form 8-K, various agreements or other documents specified in the related prospectus supplement, if applicable; |
● | Reports on Form 8-K (Current Report), following the occurrence of events specified in Form 8-K requiring disclosure, which are required to be filed within the time-frame specified in Form 8-K related to the type of event; |
● | Reports on Form 10-D (Asset-Backed Issuer Distribution Report), containing the distribution and pool performance information required on Form 10-D, which are required to be filed 15 days following each related distribution date; and |
● | Report on Form 10-K (Annual Report), containing the items specified in Form 10-K with respect to a fiscal year and filing or furnishing, as appropriate, the required exhibits and the certification delivered pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002. |
● | the payments made on that distribution date with respect to the applicable class of offered certificates, and |
● | the recent performance of the mortgage assets. |
● | that calendar year, or |
● | the applicable portion of that calendar year during which the person was a certificateholder. |
● | with respect to certain amendments to the related Governing Document as described under “Description of the Governing Documents—Amendment,” or |
● | as otherwise specified in this prospectus or in the related prospectus supplement. |
● | the final payment or other liquidation of the last mortgage asset in that trust; and |
● | the payment, or provision for payment (i) to the certificateholders of that series of all amounts required to be paid to them and (ii) to the respective parties to the Governing Document and the members, managers, officers, directors, employees and/or agents of each of them of all amounts which may have become due and owing to any of them under the Governing Document. |
● | a limited-purpose trust company organized under the New York Banking Law, |
● | a “banking corporation” within the meaning of the New York Banking Law, |
● | a member of the Federal Reserve System, |
● | a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and |
● | a “clearing agency” registered under the provisions of Section 17A of the Exchange Act. |
● | governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in street name, and |
● | the sole responsibility of each of those DTC participants, subject to any statutory or regulatory requirements in effect from time to time. |
● | we advise the related trustee or other related certificate registrar in writing that DTC is no longer willing or able to discharge properly its responsibilities as depository with respect to those offered certificates and we are unable to locate a qualified successor; or |
● | we notify DTC of our intent to terminate the book-entry system through DTC with respect to those offered certificates and, in the event applicable law and/or DTC’s procedures require that the DTC participants holding beneficial interests in those offered certificates submit a withdrawal request to DTC in order to so terminate the book-entry system, we additionally notify those DTC participants and they submit a withdrawal request with respect to such termination. |
● | the aggregate principal balance of the exchangeable certificates received in the exchange, immediately after the exchange, must equal the aggregate principal balance, immediately prior to the exchange, of the related exchangeable certificates surrendered in such exchange (for purposes of this condition, an interest-only class will have a principal balance of zero); |
● | the aggregate amount of interest payable on any distribution date with respect to the exchangeable certificates received in the exchange must equal the aggregate amount of interest payable on such distribution date with respect to the related exchangeable certificates surrendered in such exchange; and |
● | the class or classes of exchangeable certificates must be exchanged in the proportions, if any, described in the related prospectus supplement. |
● | A class of exchangeable certificates with a floating interest rate and a class of exchangeable certificates with an inverse floating interest rate may be exchangeable, together, for a class of exchangeable certificates with a fixed interest rate. In this case, the classes of surrendered exchangeable certificates with interest rates that vary with an index would produce, in the aggregate, an annual interest amount equal to that generated by the exchangeable class received in the exchange with a fixed interest rate. In addition, the aggregate principal balance of the two surrendered exchangeable classes with interest rates that vary with an index would equal the principal balance of the exchangeable class received in the exchange with the fixed interest rate. |
● | An interest-only class and a principal-only class of exchangeable certificates may be exchangeable, together, for a class of exchangeable certificates that is entitled to both principal and interest payments. The principal balance of the principal and interest class of exchangeable certificates received in the exchange would be equal to the principal balance of the surrendered exchangeable principal-only class, and the interest rate on the exchangeable principal and interest class received in the exchange would be a fixed rate that, when applied to the principal balance of this class, would generate an annual interest amount equal to the annual interest |
amount of the surrendered exchangeable interest-only class in distributions that have identical amounts and identical timing. |
● | Two or more classes of exchangeable principal and interest classes with different fixed interest rates may be exchangeable, together, for an exchangeable class that is entitled to both principal and interest payments, with a principal balance equal to the aggregate principal balance of the two or more classes of exchangeable certificates that are surrendered in the exchange, and a fixed interest rate that, when applied to the principal balance of the exchangeable class, would generate an annual interest amount equal to the aggregate amount of annual interest payable with respect to the two or more classes of exchangeable certificates that are surrendered in the exchange. |
● | A class of exchangeable certificates that accretes all of its interest for a specified period, with the accreted amount added to the principal balance of the accreting class, and a class of exchangeable certificates that receives principal payments from these accretions may be exchangeable, together, for a single class of related exchangeable certificates that receives payments of interest continuously from the first distribution date on which it receives interest until it is retired. |
● | A class of exchangeable certificates that is a planned principal class or targeted principal class, and a class of exchangeable certificates that only receives principal payments on a distribution date if scheduled payments have been made on the planned principal class or targeted principal class, as applicable, may be exchangeable, together, for a class of related exchangeable certificates that receives principal payments without regard to the schedule from the first distribution date on which it receives principal until it is retired. |
● | the price you paid for your offered certificates, |
● | the pass-through rate on your offered certificates, and |
● | the amount and timing of payments on your offered certificates. |
● | the amortization schedules of the mortgage loans, which may change from time to time to reflect, among other things, changes in mortgage interest rates or partial prepayments of principal; |
● | the dates on which any balloon payments are due; and |
● | the rate of principal prepayments on the mortgage loans, including voluntary prepayments by borrowers and involuntary prepayments resulting from liquidations, casualties or purchases of mortgage loans. |
● | whether you purchased your offered certificates at a discount or premium and, if so, the extent of that discount or premium, and |
● | when, and to what degree, payments of principal on the underlying mortgage loans are applied or otherwise result in the reduction of the principal balance or notional amount of your offered certificates. |
● | be based on the principal balances of some or all of the mortgage assets in the related trust, or |
● | equal the total principal balance, or a designated portion of the total principal balance, of one or more of the other classes of certificates of the same series. |
● | payments and other collections of principal are received on the mortgage assets referred to in the first bullet point of the prior sentence, and/or |
● | payments are made in reduction of the total principal balance, or a designated portion of the total principal balance, of any class of certificates referred to in the second bullet point of the prior sentence. |
● | the availability of mortgage credit; |
● | the relative economic vitality of the area in which the related real properties are located; |
● | the quality of management of the related real properties; |
● | the servicing of the mortgage loans; |
● | possible changes in tax laws; and |
● | other opportunities for investment. |
● | the attractiveness of selling or refinancing a commercial or multifamily property, or |
● | the likelihood of default under a commercial or multifamily mortgage loan, |
● | prepayment lock-out periods, and |
● | requirements that voluntary principal prepayments be accompanied by prepayment premiums, fees or charges. |
● | to convert to a fixed rate loan and thereby lock in that rate, or |
● | to take advantage of a different index, margin or rate cap or floor on another adjustable rate mortgage loan. |
● | realize its equity in the property, |
● | meet cash flow needs or |
● | make other investments. |
● | the particular factors that will affect the prepayment of the mortgage loans underlying any series of offered certificates, |
● | the relative importance of those factors, |
● | the percentage of the principal balance of those mortgage loans that will be paid as of any date, or |
● | the overall rate of prepayment on those mortgage loans. |
● | scheduled amortization, or |
● | prepayments, including— |
1. | voluntary prepayments by borrowers, and |
2. | involuntary prepayments resulting from liquidations, casualties or condemnations and purchases of mortgage loans out of the related trust. |
● | the projected weighted average life of each class of those offered certificates with principal balances, and |
● | the percentage of the initial total principal balance of each class of those offered certificates that would be outstanding on specified dates, |
● | to refinance the loan, or |
● | to sell the related real property. |
● | the bankruptcy of the borrower, or |
● | adverse economic conditions in the market where the related real property is located. |
● | limits the amount by which its scheduled payment may adjust in response to a change in its mortgage interest rate; |
● | provides that its scheduled payment will adjust less frequently than its mortgage interest rate; or |
● | provides for constant scheduled payments regardless of adjustments to its mortgage interest rate. |
● | the number of foreclosures with respect to the underlying mortgage loans; and |
● | the principal amount of the foreclosed mortgage loans in relation to the principal amount of those mortgage loans that are repaid in accordance with their terms. |
● | a reduction in the entitlements to interest and/or the total principal balances of one or more classes of certificates; and/or |
● | the establishment of a priority of payments among classes of certificates. |
● | amounts attributable to interest accrued but not currently payable on one or more other classes of certificates of the applicable series; |
● | interest received or advanced on the underlying mortgage assets that is in excess of the interest currently accrued on the certificates of the applicable series; |
● | prepayment premiums, fees and charges, payments from equity participations or any other amounts received on the underlying mortgage assets that do not constitute interest or principal; or |
● | any other amounts described in the related prospectus supplement. |
● | overcollateralization and/or excess cash flow; |
● | the subordination of one or more other classes of certificates of the same series; |
● | the use of a letter of credit, a surety bond, an insurance policy or a guarantee; |
● | the establishment of one or more reserve funds; or |
● | any combination of the foregoing. |
● | the nature and amount of coverage under that credit support; |
● | any conditions to payment not otherwise described in this prospectus; |
● | any conditions under which the amount of coverage under that credit support may be reduced and under which that credit support may be terminated or replaced; and |
● | the material provisions relating to that credit support. |
● | the terms of the mortgage, |
● | the terms of separate subordination agreements or intercreditor agreements with others that hold interests in the real property, |
● | the knowledge of the parties to the mortgage, and |
● | in general, the order of recordation of the mortgage in the appropriate public recording office. |
● | a mortgagor, who is the owner of the encumbered interest in the real property, and |
● | a mortgagee, who is the lender. |
● | the trustor, who is the equivalent of a mortgagor, |
● | the trustee to whom the real property is conveyed, and |
● | the beneficiary for whose benefit the conveyance is made, who is the lender. |
● | the express provisions of the related instrument, |
● | the law of the state in which the real property is located, |
● | various federal laws, and |
● | in some deed of trust transactions, the directions of the beneficiary. |
● | without a hearing or the lender’s consent, or |
● | unless the lender’s interest in the room rates is given adequate protection. |
● | judicial foreclosure, involving court proceedings, and |
● | nonjudicial foreclosure under a power of sale granted in the mortgage instrument. |
● | all parties having a subordinate interest of record in the real property, and |
● | all parties in possession of the property, under leases or otherwise, whose interests are subordinate to the mortgage. |
● | alter the specific terms of a loan to the extent it considers necessary to prevent or remedy an injustice, undue oppression or overreaching; |
● | require the lender to undertake affirmative actions to determine the cause of the borrower’s default and the likelihood that the borrower will be able to reinstate the loan; |
● | require the lender to reinstate a loan or recast a payment schedule in order to accommodate a borrower that is suffering from a temporary financial disability; or |
● | limit the right of the lender to foreclose in the case of a nonmonetary default, such as— |
1. | a failure to adequately maintain the mortgaged property, or |
2. | an impermissible further encumbrance of the mortgaged property. |
● | upheld the reasonableness of the notice provisions, or |
● | found that a public sale under a mortgage providing for a power of sale does not involve sufficient state action to trigger constitutional protections. |
● | a request from the beneficiary/lender to the trustee to sell the property upon default by the borrower, and |
● | notice of sale is given in accordance with the terms of the deed of trust and applicable state law. |
● | record a notice of default and notice of sale, and |
● | send a copy of those notices to the borrower and to any other party who has recorded a request for a copy of them. |
● | the difficulty in determining the exact status of title to the property due to, among other things, redemption rights that may exist, and |
● | the possibility that physical deterioration of the property may have occurred during the foreclosure proceedings. |
● | to enable the lender to realize upon its security, and |
● | to bar the borrower, and all persons who have interests in the property that are subordinate to that of the foreclosing lender, from exercising their equity of redemption. |
● | requires the lessor to give the leasehold mortgagee notices of lessee defaults and an opportunity to cure them, |
● | permits the leasehold estate to be assigned to and by the leasehold mortgagee or the purchaser at a foreclosure sale, and |
● | contains other protective provisions typically required by prudent lenders to be included in a ground lease. |
● | reduce the secured portion of the outstanding amount of the loan to the then-current value of the property, thereby leaving the lender a general unsecured creditor for the difference between the then-current value of the property and the outstanding balance of the loan; |
● | reduce the amount of each scheduled payment, by means of a reduction in the rate of interest and/or an alteration of the repayment schedule, with or without affecting the unpaid principal balance of the loan; |
● | extend or shorten the term to maturity of the loan; |
● | permit the bankrupt borrower to cure the subject loan default by paying the arrearage over a number of years; or |
● | permit the bankrupt borrower, through its rehabilitative plan, to reinstate the loan payment schedule even if the lender has obtained a final judgment of foreclosure prior to the filing of the debtor’s petition. |
● | past due rent, |
● | accelerated rent, |
● | damages, or |
● | a summary eviction order with respect to a default under the lease that occurred prior to the filing of the tenant’s bankruptcy petition. |
● | assume the lease and either retain it or assign it to a third party, or |
● | reject the lease. |
● | the unpaid rent due under the lease, without acceleration, for the period prior to the filing of the bankruptcy petition or any earlier repossession by the landlord, or surrender by the tenant, of the leased premises, plus |
● | the rent reserved by the lease, without acceleration, for the greater of one year and 15%, not to exceed three years, of the term of the lease following the filing of the bankruptcy petition or any earlier repossession by the landlord, or surrender by the tenant, of the leased premises. |
● | it exercises decision-making control over a borrower’s environmental compliance and hazardous substance handling and disposal practices, or |
● | assumes day-to-day management of operational functions of a mortgaged property. |
● | impose liability for releases of or exposure to asbestos-containing materials, and |
● | provide for third parties to seek recovery from owners or operators of real properties for personal injuries associated with those releases. |
● | first, to the payment of court costs and fees in connection with the foreclosure; |
● | second, to real estate taxes; |
● | third, in satisfaction of all principal, interest, prepayment or acceleration penalties, if any, and any other sums due and owing to the holder of the senior liens; and |
● | last, in satisfaction of all principal, interest, prepayment and acceleration penalties, if any, and any other sums due and owing to the holder of the junior mortgage loan. |
● | the borrower may have difficulty servicing and repaying multiple loans; |
● | if the subordinate financing permits recourse to the borrower, as is frequently the case, and the senior loan does not, a borrower may have more incentive to repay sums due on the subordinate loan; |
● | acts of the senior lender that prejudice the junior lender or impair the junior lender’s security, such as the senior lender’s agreeing to an increase in the principal amount of or the interest rate payable on the senior loan, may create a superior equity in favor of the junior lender; |
● | if the borrower defaults on the senior loan and/or any junior loan or loans, the existence of junior loans and actions taken by junior lenders can impair the security available to the senior lender and can interfere with or delay the taking of action by the senior lender; and |
● | the bankruptcy of a junior lender may operate to stay foreclosure or similar proceedings by the senior lender. |
● | its mortgage was executed and recorded before commission of the illegal conduct from which the assets used to purchase or improve the property were derived or before the commission of any other crime upon which the forfeiture is based, or |
● | the lender, at the time of execution of the mortgage, “did not know or was reasonably without cause to believe that the property was subject to forfeiture.” |
● | banks, |
● | insurance companies, |
● | foreign investors. |
● | tax exempt investors, |
● | holders whose “functional currency” is not the United States dollar, |
● | United States expatriates, and |
● | holders holding the offered certificates as part of a hedge, straddle, integrated or conversion transaction. |
● | REMIC certificates, representing interests in a trust, or a portion of the assets of that trust, as to which a specified person or entity will make a real estate mortgage investment conduit, or REMIC, election under sections 860A through 860G of the Internal Revenue Code; and |
● | grantor trust certificates, representing interests in a trust, or a portion of the assets of that trust, as to which no REMIC election will be made. |
● | the related trust, or the relevant designated portion of the trust, will qualify as a REMIC, and |
● | any and all offered certificates representing interests in a REMIC will be either— |
1. | REMIC regular certificates, representing regular interests in the REMIC, or |
2. | REMIC residual certificates, representing residual interests in the REMIC. |
● | “real estate assets” within the meaning of section 856(c)(5)(B) of the Internal Revenue Code in the hands of a real estate investment trust, and in the case of REMIC regular certificates, the interest (including OID) on which, and in the case of REMIC residual certificates, the income allocated with respect thereto, will be considered “interest on obligations secured by mortgages |
on real property or on interests in real property” within the meaning of section 856(c)(3)(B) of the Internal Revenue Code, and |
● | “loans secured by an interest in real property” or other assets described in section 7701(a)(19)(C) of the Internal Revenue Code in the hands of a thrift institution, |
● | collections on mortgage loans held pending payment on the related offered certificates, and |
● | any property acquired by foreclosure held pending sale, and may include amounts in reserve accounts. |
● | a portion of that certificate may not represent ownership of “loans secured by an interest in real property” or other assets described in section 7701(a)(19)(C) of the Internal Revenue Code; |
● | a portion of that certificate may not represent ownership of “real estate assets” under section 856(c)(5)(B) of the Internal Revenue Code; and |
● | the interest or other income on that certificate may not constitute “interest on obligations secured by mortgages on real property or on interests in real property” within the meaning of section 856(c)(3)(B) of the Internal Revenue Code. |
● | whether the related REMIC certificates will be “real estate assets” within the meaning of section 856(c)(5)(B) of the Internal Revenue Code, |
● | whether the related REMIC certificates will be “loans secured by an interest in real property” under section 7701(a)(19)(C) of the Internal Revenue Code, and |
● | whether the interest or other income on the related REMIC certificates is interest described in section 856(c)(3)(B) of the Internal Revenue Code. |
● | the number of complete years, rounding down for partial years, from the date of initial issuance, until that payment is expected to be made, presumably taking into account the prepayment assumption, by |
● | a fraction— |
1. | the numerator of which is the amount of the payment, and |
2. | the denominator of which is the stated redemption price at maturity of the certificate. |
● | the total amount of thede minimis original issue discount, and |
● | a fraction— |
1. | the numerator of which is the amount of the principal payment, and |
2. | the denominator of which is the outstanding stated principal amount of the subject REMIC regular certificate. |
● | the sum of: |
1. | the present value, as of the end of the accrual period (determined by using as a discount factor the original yield to maturity of the REMIC regular certificate as calculated taking into account the prepayment assumption), of all of the payments remaining to be made on the subject REMIC regular certificate, if any, in future periods, taking into account the prepayment assumption, and |
2. | the payments made on that certificate during the accrual period of amounts included in the stated redemption price, over |
● | the adjusted issue price of the subject REMIC regular certificate at the beginning of the accrual period. |
● | the issue price of the certificate, increased by |
● | the total amount of original issue discount previously accrued on the certificate, reduced by |
● | the amount of all prior payments of amounts included in its stated redemption price. |
● | the adjusted issue price or, in the case of the first accrual period, the issue price, of the certificate at the beginning of the accrual period which includes that date of determination, and |
● | the daily portions of original issue discount for all days during that accrual period prior to that date of determination, |
● | in the case of a certificate issued without original issue discount, you purchased the certificate at a price less than its remaining stated principal amount, or |
● | in the case of a certificate issued with original issue discount, you purchased the certificate at a price less than its adjusted issue price. |
● | on the basis of a constant yield method, |
● | in the case of a certificate issued without original issue discount, in an amount that bears the same ratio to the total remaining market discount as the stated interest paid in the accrual period bears to the total amount of stated interest remaining to be paid on the certificate as of the beginning of the accrual period, or |
● | in the case of a certificate issued with original issue discount, in an amount that bears the same ratio to the total remaining market discount as the original issue discount accrued in the accrual period bears to the total amount of original issue discount remaining on the certificate at the beginning of the accrual period. |
● | the purchase price paid for your offered certificate, and |
● | the payments remaining to be made on your offered certificate at the time of its acquisition by you. |
● | you will not be entitled to deduct a loss under section 166 of the Internal Revenue Code until your offered certificate becomes wholly worthless, which is when its principal balance has been reduced to zero, and |
● | the loss will be characterized as a short-term capital loss. |
● | other sources of funds sufficient to pay any federal income taxes due as a result of your ownership of REMIC residual certificates, or |
● | unrelated deductions against which income may be offset. |
● | excess inclusions, |
● | residual interests without significant value, and |
● | noneconomic residual interests. |
● | the income from the mortgage loans and other assets of the REMIC; plus |
● | any cancellation of indebtedness income due to the allocation of realized losses to those REMIC certificates constituting regular interests in the REMIC; less the following items— |
1. | the deductions allowed to the REMIC for interest, including original issue discount but reduced by any premium on issuance, on any class of REMIC certificates constituting regular interests in the REMIC, whether offered or not, |
2. | amortization of any premium on the mortgage loans held by the REMIC, |
3. | bad debt losses with respect to the mortgage loans held by the REMIC, and |
4. | except as described below in this “—Taxable Income of the REMIC” subsection, servicing, administrative and other expenses. |
● | the amount paid for that REMIC residual certificate, |
● | increased by amounts included in the income of the holder of that REMIC residual certificate, and |
● | decreased, but not below zero, by payments made, and by net losses allocated, to the holder of that REMIC residual certificate. |
● | through distributions, |
● | through the deduction of any net losses of the REMIC, or |
● | upon the sale of its REMIC residual certificate. |
● | the sum of the daily portions of REMIC taxable income allocable to that certificate, over |
● | the sum of the daily accruals for each day during the quarter that the certificate was held by that holder. |
● | the issue price of the certificate, increased by |
● | the sum of the daily accruals for all prior quarters, and decreased, but not below zero, by |
● | any payments made with respect to the certificate before the beginning of that quarter. |
● | will not be permitted to be offset by deductions, losses or loss carryovers from other activities, |
● | will be treated as unrelated business taxable income to an otherwise tax-exempt organization, and |
● | will not be eligible for any rate reduction or exemption under any applicable tax treaty with respect to the 30% United States withholding tax imposed on payments to holders of REMIC residual certificates that are foreign investors. |
● | excess inclusions will not be permitted to be offset by the alternative tax net operating loss deduction, and |
● | alternative minimum taxable income may not be less than the taxpayer’s excess inclusions; provided, however, that for purposes of this clause, alternative minimum taxable income is determined without regard to the special rule that taxable income cannot be less than excess inclusions. |
● | regulated investment companies, |
● | common trusts, and |
● | some cooperatives. |
● | the present value of the expected future payments on the REMIC residual certificate equals at least the present value of the expected tax on the anticipated excess inclusions, and |
● | the transferor reasonably expects that the transferee will receive payments with respect to the REMIC residual certificate at or after the time the taxes accrue on the anticipated excess inclusions in an amount sufficient to satisfy the accrued taxes. |
● | from each party to the transfer, stating that no purpose of the transfer is to impede the assessment or collection of tax, |
● | from the prospective transferee, providing representations as to its financial condition and that it understands that, as the holder of a non-economic REMIC residual certificate, it may incur tax liabilities in excess of any cash flows generated by the REMIC residual certificate and that such transferee intends to pay its taxes associated with holding such REMIC residual certificate as they become due, and |
● | from the prospective transferor, stating that it has made a reasonable investigation to determine the transferee’s historic payment of its debts and ability to continue to pay its debts as they come due in the future. |
● | the present value of any consideration given to the transferee to acquire the interest, |
● | the present value of the expected future distributions on the interest, and |
● | the present value of the anticipated tax savings associated with the holding of the interest as the REMIC generates losses. |
● | an individual, |
● | an estate or trust, or |
● | a Pass-Through Entity beneficially owned by one or more individuals, estates or trusts, |
● | an amount equal to this individual’s, estate’s or trust’s share of these fees and expenses will be added to the gross income of this holder, and |
● | the individual’s, estate’s or trust’s share of these fees and expenses will be treated as a miscellaneous itemized deduction allowable subject to the limitation of section 67 of the Internal Revenue Code, which permits the deduction of these fees and expenses only to the extent they exceed, in total, 2% of a taxpayer’s adjusted gross income. |
● | 3% of the excess, if any, of such taxpayer’s adjusted gross income over such specified amount, or |
● | 80% of the amount of itemized deductions otherwise allowable for such tax year. |
● | an individual, |
● | an estate or trust, or |
● | a Pass-Through Entity beneficially owned by one or more individuals, estates or trusts, |
● | the cost of the certificate to that certificateholder, increased by |
● | income reported by that certificateholder with respect to the certificate, including original issue discount and market discount income, and reduced, but not below zero, by |
● | payments on the certificate received by that certificateholder, amortized premium and realized losses allocated to the certificate and previously deducted by the certificateholder. |
● | entitle the holder to a specified principal amount, |
● | pay interest at a fixed or variable rate, and |
● | are not convertible into the stock of the issuer or a related party, |
● | the amount that would have been includible in the seller’s income with respect to that REMIC regular certificate assuming that income had accrued on the certificate at a rate equal to 110% of the applicable Federal rate determined as of the date of purchase of the certificate, which is a rate based on an average of current yields on Treasury securities having a maturity comparable to that of the certificate based on the application of the prepayment assumption to the certificate, over |
● | the amount of ordinary income actually includible in the seller’s income prior to that sale. |
● | reacquires that same REMIC residual certificate, |
● | acquires any other residual interest in a REMIC, or |
● | acquires any similar interest in a taxable mortgage pool, as defined in section 7701(i) of the Internal Revenue Code. |
● | the disposition of a non-defaulted mortgage loan, |
● | the receipt of income from a source other than a mortgage loan or other permitted investments, |
● | the receipt of compensation for services, or |
● | the gain from the disposition of an asset purchased with collections on the mortgage loans for temporary investment pending payment on the REMIC certificates. |
● | the person has sufficient assets to do so, and |
● | the tax arises out of a breach of that person’s obligations under select provisions of the related Governing Document. |
● | the present value of the total anticipated excess inclusions with respect to the REMIC residual certificate for periods after the transfer, and |
● | the highest marginal federal income tax rate applicable to corporations. |
● | events that have occurred up to the time of the transfer, |
● | the prepayment assumption, and |
● | any required or permitted clean up calls or required liquidation provided for in the related Governing Document. |
● | the transferee furnishes to the transferor an affidavit that the transferee is not a Disqualified Organization, and |
● | as of the time of the transfer, the transferor does not have actual knowledge that the affidavit is false. |
● | the amount of excess inclusions on the certificate that are allocable to the interest in the Pass-Through Entity held by the Disqualified Organization, and |
● | the highest marginal federal income tax rate imposed on corporations. |
● | the holder’s social security number and a statement under penalties of perjury that the social security number is that of the record holder, or |
● | a statement under penalties of perjury that the record holder is not a Disqualified Organization. |
● | the residual interests in the entity are not held by Disqualified Organizations, and |
● | the information necessary for the application of the tax described in this prospectus will be made available. |
● | income, |
● | deductions, |
● | gains, |
● | losses, and |
● | classification as a REMIC. |
● | corporations, |
● | trusts, |
● | securities dealers, and |
● | various other non-individuals, |
● | 30 days after the end of the quarter for which the information was requested, or |
● | two weeks after the receipt of the request. |
● | income, |
● | excess inclusions, |
● | investment expenses, and |
● | relevant information regarding qualification of the REMIC’s assets, |
● | fail to furnish to the payor information regarding, among other things, their taxpayer identification numbers, or |
● | otherwise fail to establish an exemption from this tax. |
● | a foreign person, and |
● | not subject to federal income tax as a result of any direct or indirect connection to the United States in addition to its ownership of that certificate, |
● | owns 10% or more of one or more underlying mortgagors, or |
● | if the holder is a controlled foreign corporation, is related to one or more mortgagors in the applicable trust. |
● | foreign persons, or |
● | an entity that is classified as a U.S. partnership under the Internal Revenue Code if any of its partners, directly or indirectly (other than through a U.S. corporation) is (or is permitted to be under the partnership agreement) a foreign person. |
● | a grantor trust fractional interest certificate representing an undivided equitable ownership interest in the principal of the mortgage loans constituting the related grantor trust, together with interest, if any, on those loans at a pass-through rate; or |
● | a grantor trust strip certificate representing ownership of all or a portion of an amount equal to— |
1. | interest paid on the mortgage loans constituting the related grantor trust, minus |
2. | the sum of: |
● | normal administration fees, and |
● | interest paid to the holders of grantor trust fractional interest certificates issued with respect to that grantor trust |
● | “loans . . . secured by an interest in real property” within the meaning of section 7701(a)(19)(C)(v) of the Internal Revenue Code, but only to the extent that the underlying mortgage loans have been made with respect to property that is used for residential or other prescribed purposes; |
● | “obligation[s] (including any participation or certificate of beneficial ownership therein) which . . . [are] principally secured by an interest in real property” within the meaning of section 860G(a)(3) of the Internal Revenue Code; and |
● | “real estate assets” within the meaning of section 856(c)(5)(B) of the Internal Revenue Code. |
● | consisting of mortgage loans that are “loans . . . secured by an interest in real property” within the meaning of section 7701(a)(19)(C)(v) of the Internal Revenue Code, |
● | consisting of mortgage loans that are “real estate assets” within the meaning of section 856(c)(5)(B) of the Internal Revenue Code, and |
● | the interest on which is “interest on obligations secured by mortgages on real property or on interests in real property” within the meaning of section 856(c)(3)(B) of the Internal Revenue Code, |
● | will be required to report on their federal income tax returns their shares of the entire income from the underlying mortgage loans, including amounts used to pay reasonable servicing fees and other expenses, and |
● | will be entitled to deduct their shares of any reasonable servicing fees and other expenses. |
● | a class of grantor trust strip certificates is issued as part of the same series, or |
● | we or any of our affiliates retain, for our or its own account or for purposes of resale, a right to receive a specified portion of the interest payable on an underlying mortgage loan. |
● | a master servicer, |
● | a special servicer, |
● | any sub-servicer, or |
● | their respective affiliates. |
● | the treatment of some stripped bonds as market discount bonds, and |
● | de minimis market discount. |
● | the holder’s adjusted basis in the grantor trust fractional interest certificate at the beginning of the related month, as defined in “—Grantor Trusts—Sales of Grantor Trust Certificates,” and |
● | the yield of that grantor trust fractional interest certificate to the holder. |
● | a prepayment assumption determined when certificates are offered and sold hereunder, which we will disclose in the related prospectus supplement, and |
● | a constant yield computed using a representative initial offering price for each class of certificates. |
● | the mortgage loans in any of our trusts will in fact prepay at a rate conforming to the prepayment assumption used or any other rate, or |
● | the prepayment assumption will not be challenged by the IRS on audit. |
● | there is no original issue discount or only ade minimis amount of original issue discount, or |
● | the annual stated rate of interest payable on the original bond is no more than one percentage point lower than the gross interest rate payable on the related mortgage loans, before subtracting any servicing fee or any stripped coupon. |
● | 0.25% of the stated redemption price, and |
● | the weighted average maturity of the related mortgage loans, |
● | the stated redemption price of the mortgage loans, and |
● | their issue price. |
● | the adjusted issue price or the issue price, in the case of the first accrual period, of the mortgage loan at the beginning of the accrual period that includes that day, and |
● | the daily portions of original issue discount for all days during the accrual period prior to that day, and reduced by |
● | the amount of any payments made on the mortgage loan during the accrual period prior to that day of amounts included in its stated redemption price. |
● | the issue price of the mortgage loan, increased by |
● | the total amount of original issue discount with respect to the mortgage loan that accrued in prior accrual periods, and reduced by |
● | the amount of any payments made on the mortgage loan in prior accrual periods of amounts included in its stated redemption price. |
● | a prepayment assumption determined when the certificates are offered and sold hereunder and disclosed in the related prospectus supplement, and |
● | a constant yield computed using a representative initial offering price for each class of certificates. |
● | the mortgage loans will in fact prepay at a rate conforming to the prepayment assumption or any other rate, or |
● | the prepayment assumption will not be challenged by the IRS on audit. |
● | in the case of a mortgage loan issued without original issue discount, it is purchased at a price less than its remaining stated redemption price, or |
● | in the case of a mortgage loan issued with original issue discount, it is purchased at a price less than its adjusted issue price. |
● | be allocated among the payments of stated redemption price on the mortgage loan, and |
● | be allowed as a deduction as those payments are made or, for an accrual method certificateholder, due. |
● | the price paid for that grantor trust strip certificate by you, and |
● | the projected payments remaining to be made on that grantor trust strip certificate at the time of the purchase, plus |
● | an allocable portion of the projected servicing fees and expenses to be paid with respect to the underlying mortgage loans. |
● | the prepayment assumption we will disclose in the related prospectus supplement, and |
● | a constant yield computed using a representative initial offering price for each class of certificates. |
● | the mortgage loans in any of our trusts will in fact prepay at a rate conforming to the prepayment assumption or at any other rate or |
● | the prepayment assumption will not be challenged by the IRS on audit. |
● | the amount realized on the sale or exchange of a grantor trust certificate, and |
● | its adjusted basis. |
● | its cost, increased by |
● | any income reported by the seller, including original issue discount and market discount income, and reduced, but not below zero, by |
● | any and all previously reported losses, amortized premium, and payments with respect to that grantor trust certificate. |
● | entitle the holder to a specified principal amount, |
● | pay interest at a fixed or variable rate, and |
● | are not convertible into the stock of the issuer or a related party, |
● | the amount of servicing compensation received by a master servicer or special servicer, and |
● | all other customary factual information the reporting party deems necessary or desirable to enable holders of the related grantor trust certificates to prepare their tax returns. |
● | a custodian of a person’s account, |
● | a nominee, and |
● | a broker holding an interest for a customer in street name. |
● | ERISA Plans, and |
● | persons that are fiduciaries with respect to ERISA Plans, |
● | investment prudence and diversification, and |
● | compliance with the investing ERISA Plan’s governing documents. |
● | sales, exchanges or leases of property; |
● | loans or other extensions of credit; and |
● | the furnishing of goods and services. |
1. | those with discretionary authority or control over the assets of the entity, |
2. | those who provide investment advice directly or indirectly for a fee with respect to the assets of the entity, and |
3. | those who are affiliates of the persons described in the preceding clauses 1. and 2. |
● | has discretionary authority or control over the management or disposition of the assets of that Plan, or |
● | provides investment advice with respect to the assets of that Plan for a fee. |
● | deemed to be a fiduciary with respect to the investing Plan, and |
● | subject to the fiduciary responsibility provisions of ERISA. |
● | Prohibited Transaction Class Exemption 90-1, which exempts particular transactions between insurance company separate accounts and Parties in Interest; |
● | Prohibited Transaction Class Exemption 91-38, which exempts particular transactions between bank collective investment funds and Parties in Interest; |
● | Prohibited Transaction Class Exemption 84-14, which exempts particular transactions effected on behalf of a Plan by a “qualified professional asset manager;” |
● | Prohibited Transaction Class Exemption 95-60, which exempts particular transactions between insurance company general accounts and Parties in Interest; and |
● | Prohibited Transaction Class Exemption 96-23, which exempts particular transactions effected on behalf of an ERISA Plan by an “in-house asset manager.” |
● | the servicing and operation of some mortgage assets pools, such as the types of mortgage asset pools that will be included in our trusts, and |
● | the purchase, sale and holding of some certificates evidencing interests in those pools that are underwritten by Citigroup Global Markets Inc. or any person affiliated with Citigroup Global Markets Inc., such as particular classes of the offered certificates. |
● | consider your general fiduciary obligations under ERISA, and |
● | consult with your legal counsel as to— |
1. | the potential applicability of ERISA and Section 4975 of the Internal Revenue Code to that investment, and |
2. | the availability of any prohibited transaction exemption in connection with that investment. |
1. | by negotiated firm commitment or best efforts underwriting and public offering by one or more underwriters specified in the related prospectus supplement; |
2. | by placements by us with institutional investors through dealers; and |
3. | by direct placements by us with institutional investors. |
● | the obligations of the underwriters will be subject to various conditions precedent, |
● | the underwriters will be obligated to purchase all the certificates if any are purchased, other than in connection with an underwriting on a best efforts basis, and |
● | in limited circumstances, we will indemnify the several underwriters and each person, if any, that controls an underwriter within the meaning of Section 15 of the Securities Act, and the underwriters will indemnify us and each person, if any, that controls us within the meaning of Section 15 of the Securities Act, against civil liabilities relating to disclosure in our registration statement, this prospectus or any of the related prospectus supplements, including liabilities under the Securities Act, or will contribute to payments required to be made with respect to any liabilities. |
● | whether the price paid for those certificates is fair; |
● | whether those certificates are a suitable investment for any particular investor; |
● | the tax attributes of those certificates or of the related trust; |
● | the yield to maturity or, if they have principal balances, the average life of those certificates; |
● | the likelihood or frequency of prepayments of principal on the underlying mortgage loans; |
● | the degree to which the amount or frequency of prepayments on the underlying mortgage loans might differ from those originally anticipated; |
● | whether or to what extent the interest payable on those certificates may be reduced in connection with interest shortfalls resulting from the timing of voluntary prepayments; |
● | the likelihood that any amounts other than interest at the related mortgage interest rates and principal will be received with respect to the underlying mortgage loans; or |
● | if those certificates provide solely or primarily for payments of interest, whether the holders, despite receiving all payments of interest to which they are entitled, would ultimately recover their initial investments in those certificates. |
● | the United States, |
● | any State or political subdivision of the United States, |
● | any foreign government, |
● | any international organization, |
● | any agency or instrumentality of the foregoing, except for instrumentalities described in section 168(h)(2)(D) of the Internal Revenue Code or Freddie Mac, |
● | any organization, other than a cooperative described in section 521 of the Internal Revenue Code, that is exempt from federal income tax, except if it is subject to the tax imposed by section 511 of the Internal Revenue Code, or |
● | any organization described in section 1381(a)(2)(C) of the Internal Revenue Code. |
● | regulated investment company, |
● | real estate investment trust, |
● | trust, |
● | partnership, or |
● | other entity described in section 860E(e)(6) of the Internal Revenue Code. |
● | a citizen or resident of the United States; |
● | a corporation, partnership or other entity created or organized in, or under the laws of, the United States, any state or the District of Columbia; |
● | an estate whose income from sources without the United States is includible in gross income for United States federal income tax purposes regardless of its connection with the conduct of a trade or business within the United States; or |
● | a trust as to which— |
1. | a court in the United States is able to exercise primary supervision over the administration of the trust, and |
2. | one or more United States persons have the authority to control all substantial decisions of the trust. |
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No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus and prospectus supplement. You must not rely on any unauthorized information or representations. This prospectus and prospectus supplement is an offer to sell only the certificates offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus and prospectus supplement is current only as of its date. | $666,096,000
Citigroup Commercial Mortgage (as Issuing Entity)
Citigroup Commercial Mortgage (as Depositor)
Commercial Mortgage | ||||||||||||
TABLE OF CONTENTS | |||||||||||||
Prospectus Supplement | |||||||||||||
Certificate Summary | S-13 | ||||||||||||
Summary | S-15 | ||||||||||||
Risk Factors | S-65 | ||||||||||||
Description of the Mortgage Pool | S-109 | ||||||||||||
Transaction Parties | S-179 | ||||||||||||
Description of the Offered Certificates | S-241 | ||||||||||||
Yield, Prepayment and Maturity Considerations | S-269 | ||||||||||||
The Pooling and Servicing Agreement | S-281 | ||||||||||||
Use of Proceeds | S-341 | ||||||||||||
Material Federal Income Tax Consequences | S-342 | ||||||||||||
State and Other Tax Considerations | S-346 | ||||||||||||
ERISA Considerations | S-346 | ||||||||||||
Legal Investment | S-350 | Class A-1 | $ | 28,330,000 | |||||||||
Certain Legal Aspects of the Mortgage Loans | S-352 | Class A-2 | $ | 2,298,000 | |||||||||
Ratings | S-353 | Class A-3 | $ | 160,000,000 | |||||||||
Plan of Distribution (Underwriter Conflicts of Interest) | S-355 | Class A-4 | $ | 268,724,000 | |||||||||
Legal Matters | S-356 | Class A-AB | $ | 46,974,000 | |||||||||
Index of Certain Defined Terms | S-357 | Class X-A | $ | 565,089,000 | |||||||||
Class A-S | $ | 58,763,000 | |||||||||||
Annex A | – | Statistical Characteristics of the Mortgage | Class B | $ | 42,871,000 | ||||||||
Loans | A-1 | Class PEZ | $ | 135,486,000 | |||||||||
Annex B | – | Structural and Collateral Term Sheet | B-1 | Class C | $ | 33,852,000 | |||||||
Annex C | – | Mortgage Pool Information | C-1 | Class D | $ | 24,284,000 | |||||||
Annex D | – | Form of Distribution Date Statement | D-1 | ||||||||||
Annex E-1 | – | Sponsor Representations and | |||||||||||
Warranties | E-1-1 | PROSPECTUS SUPPLEMENT | |||||||||||
Annex E-2 | – | Exceptions to Sponsor Representations | |||||||||||
and Warranties | E-2-1 | ||||||||||||
Annex F | – | Class A-AB Scheduled Principal Balance | Co-Lead Managers and Joint Bookrunners
Citigroup
Co-Manager Drexel Hamilton
June 24, 2015
| ||||||||||
Schedule | F-1 | ||||||||||||
Annex G | – | St. Anthony’s Healthplex North Mortgage | |||||||||||
Loan Amortization Schedule | G-1 | ||||||||||||
Prospectus | |||||||||||||
Table of Contents | 2 | ||||||||||||
Important Notice About the Information Presented in This | |||||||||||||
Prospectus and the Related Prospectus Supplement | 6 | ||||||||||||
Available Information | 6 | ||||||||||||
Summary of Prospectus | 7 | ||||||||||||
Risk Factors | 19 | ||||||||||||
Capitalized Terms Used in This Prospectus | 79 | ||||||||||||
The Trust Fund | 79 | ||||||||||||
Transaction Participants | 88 | ||||||||||||
Description of the Governing Documents | 91 | ||||||||||||
Description of the Certificates | 103 | ||||||||||||
Yield and Maturity Considerations | 119 | ||||||||||||
Description of Credit Support | 125 | ||||||||||||
Certain Legal Aspects of the Mortgage Loans | 127 | ||||||||||||
Material Federal Income Tax Consequences | 148 | ||||||||||||
State and Other Tax Consequences | 191 | ||||||||||||
ERISA Considerations | 191 | ||||||||||||
Legal Investment | 195 | ||||||||||||
Use of Proceeds | 196 | ||||||||||||
Method of Distribution | 196 | ||||||||||||
Legal Matters | 198 | ||||||||||||
Financial Information | 198 | ||||||||||||
Ratings | 198 | ||||||||||||
Glossary | 200 | ||||||||||||
Until 90 days after the date of this prospectus supplement, all dealers effecting transactions in the offered certificates, whether or not participating in this distribution, may be required to deliver a prospectus supplement and prospectus. This is in addition to the dealer’s obligation to deliver a prospectus when acting as underwriter and with respect to an unsold allotment or subscription. | |||||||||||||