Fitch Affirms CSMC Trust 2015-TOWN

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has affirmed six classes of the CSMC Trust 2015-TOWN commercial mortgage pass-through certificates, series 2015-TOWN. A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

The affirmations reflect the stable performance of the portfolio since issuance. Fitch reviewed the trailing 12 month (TTM) September 2015 financial performance of the collateral. The collateral, a portfolio of 85 economy extended-stay hotels, has demonstrated an upward trend in occupancy and servicer-reported net cash flow improved 4.3% since issuance.

As of the February 2016 distribution date, the pool's aggregate certificate balance remained at $380 million, unchanged from issuance. The two-year, floating-rate, interest-only loan matures in March 2017 and has three one-year extension options. This single borrower transaction is primarily secured by first priority, cross-defaulted and cross-collateralized mortgage liens consisting of a portfolio of 85 economy extended-stay hotels (10,764 keys) branded as InTown Suites. The mortgage loan is also secured by all FF&E and personal property used in the operation of the properties. No single asset accounted for more than 2% of cash flow at issuance. The portfolio is located in 18 U.S. states with concentrations in Texas (32.8%), Florida (11.7%), Tennessee (9.5%) and Virginia (5%). The top three cities in Texas as a percentage of the total pool balance are Houston (9.7%), San Antonio (6.2%) and Arlington (4.1%).

The servicer-reported occupancy was 87.3% as of TTM September 2015 compared to 86.8% as of year-end 2014 at issuance. The servicer provided the Smith Travel Report as of September 2015 for each property; the portfolio's TTM RevPAR increased an average 10.2% over the prior year. While Fitch will continue to monitor the exposure to properties in oil dependent economies, as of the September 2015 reporting, the TTM RevPAR for these properties showed increases similar to the balance of the portfolio.

RATING SENSITIVITIES

The Rating Outlook for all classes remains Stable. No rating actions are anticipated unless there are material changes in property performance or cash flow. The portfolio is performing as expected at issuance. Fitch will continue to monitor the subject portfolio's performance to ensure that revenues and incomes considered at the time of Fitch's initial ratings are sustainable over the loan term.

DUE DILIGENCE USAGE

No third-party due diligence was provided or reviewed in relation to this rating action.

Fitch has affirmed the following classes:

--$138.5 million class A at 'AAAsf'; Outlook Stable;

--$36 million class B at 'AA-sf'; Outlook Stable;

--$24 million class C at 'A-sf'; Outlook Stable;

--$36.5 million class D at 'BBB-sf'; Outlook Stable;

--$67 million class E at 'BB-sf'; Outlook Stable;

--$69 million class F at 'B-sf'; Outlook Stable.

Fitch does not rate the $9 million TF class certificates.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Criteria for Analyzing Large Loans in U.S. Commercial Mortgage Transactions (pub. 27 Aug 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=870009

Global Structured Finance Rating Criteria (pub. 06 Jul 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1001085

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1001085

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160317005875/en/

Fitch Ratings
Primary Analyst
Tiffany Pierce
Associate Director
+1-212-908-9107
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Committee Chairperson
Mary MacNeill
Managing Director
+1-212-908-0785
or
Media Relations:
Sandro Scenga, New York, +1 212-908-0278
Email: [email protected]

Source: Fitch Ratings

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