Fitch expects to rate the transaction and assign Rating Outlooks as follows:
(*) Notional amount and interest-only.
(a) Privately placed pursuant to Rule 144A.
(b) 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.
The expected ratings are based on information provided by the issuer as of
The certificates represent the beneficial ownership in the trust, primary assets of which are 70 loans secured by 111 commercial properties having an aggregate principal balance of approximately
Fitch reviewed a comprehensive sample of the transaction's collateral, including site inspections on 78.8% of the properties by balance, cash flow analysis of 82.4%, and asset summary reviews of 86% of the pool.
KEY RATING DRIVERS
High Fitch Leverage: The pool's Fitch debt service coverage ratio (DSCR) and loan to value (LTV) are 1.12x and 109.1%, respectively, which are worse than the 2013 and 2012 averages of 1.29x and 101.6%, and 1.24x and 97.2%, respectively.
Limited Lodging Exposure: The pool's hotel concentration of 4.9% is lower than the 2013 average hotel concentration of 14.7%. There are no hotel properties within the top 25 loans. Hotels have a higher probability of default in Fitch's multiborrower model.
Property Type Diversity: The pool is more diverse by property type than recent transactions with the largest property type in the pool being retail properties at 29.8%, followed by multifamily at 20.4%, office at 12.8% and independent living at 9.9% of the pool. No other property type comprises more than 7.8% of the pool.
Limited Amortization: The pool is scheduled to amortize by 12.8% of the initial pool balance prior to maturity. The pool's concentration of partial interest loans (31.8%), which includes four of the 10 largest loans, is slightly lower than the 2013 average (34%). However, the pool's concentration of full-term interest-only loans (20%), including two of the 10 largest loans, is higher than the 2013 average (17.1%).
For this transaction, Fitch's net cash flow (NCF) was 4.4% below the most recent net operating income (NOI) (for properties for which historical NOI was provided, excluding properties that were stabilizing during the most recent reporting period). Unanticipated further declines in property-level NCF could result in higher defaults and loss severity on defaulted loans, and could result in potential rating actions on the certificates. Fitch evaluated the sensitivity of the ratings assigned to CGCMT 2014-GC21 certificates and found that the transaction displays slightly above-average sensitivity to further declines in NCF. In a scenario in which NCF declined a further 20% from Fitch's NCF, a downgrade of the junior 'AAAsf' certificates to 'Asf' could result. In a more severe scenario, in which NCF declined a further 30% from Fitch's NCF, a downgrade of the junior 'AAAsf' certificates to 'BBBsf' could result. The presale report includes a detailed explanation of additional stresses and sensitivities on pages 81 - 82.
The master servicer will be
The presale report is available at www.fitchratings.com.
Additional information is available at www.fitchratings.com.
--'Criteria for Analyzing Multiborrower U.S. Commercial Mortgage Transactions (August 2013);
--Global Structured Finance Rating Criteria (May 2013);
--Rating Criteria for U.S. Commercial Mortgage Servicers (February 2014);
--U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria (December 2013);
--Counterparty Criteria for Structured Finance and Covered Bonds (
Criteria for Analyzing Multiborrower U.S. Commercial Mortgage Transactions
Global Structured Finance Rating Criteria
Rating Criteria for U.S. Commercial Mortgage Servicers
U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria
Counterparty Criteria for Structured Finance and Covered Bonds
Source: Fitch Ratings
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