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Rating Action:

Moody's upgrades one and affirms seven classes of COMM 2015-CCRE23

24 Apr 2019

Approximately $1.1 billion of structured securities affected

New York, April 24, 2019 -- Moody's Investors Service, ("Moody's") has upgraded the rating on one class and affirmed the ratings on seven classes in COMM 2015-CCRE23 Mortgage Trust, Commercial Mortgage Pass-Through Certificates, Series 2015-CCRE23 as follows:

Cl. A-1, Affirmed Aaa (sf); previously on Apr 5, 2018 Affirmed Aaa (sf)

Cl. A-2, Affirmed Aaa (sf); previously on Apr 5, 2018 Affirmed Aaa (sf)

Cl. A-3, Affirmed Aaa (sf); previously on Apr 5, 2018 Affirmed Aaa (sf)

Cl. A-4, Affirmed Aaa (sf); previously on Apr 5, 2018 Affirmed Aaa (sf)

Cl. A-SB, Affirmed Aaa (sf); previously on Apr 5, 2018 Affirmed Aaa (sf)

Cl. A-M, Affirmed Aa2 (sf); previously on Apr 5, 2018 Affirmed Aa2 (sf)

Cl. CM-B, Upgraded to A1 (sf); previously on Apr 5, 2018 Affirmed A3 (sf)

Cl. X-A*, Affirmed Aa1 (sf); previously on Apr 5, 2018 Affirmed Aa1 (sf)

* Reflects Interest Only Classes

RATINGS RATIONALE

The ratings on six P&I classes were affirmed because the transaction's key metrics, including Moody's loan-to-value (LTV) ratio, Moody's stressed debt service coverage ratio (DSCR) and the transaction's Herfindahl Index (Herf), are within acceptable ranges.

The rating on the non-pooled rake bond, Cl. CM-B, was upgraded due to improvement in the Moody's loan to value (LTV) ratio for the Courtyard by Marriott Portfolio loan.

The rating on the IO class, Cl. X-A, was affirmed based on the credit quality of its referenced classes.

Moody's rating action reflects a base expected loss of 4.7% of the current pooled balance, the same as at Moody's last review. Moody's base expected loss plus realized losses is now 4.6% of the original pooled balance, the same as at Moody's last review. Moody's provides a current list of base expected losses for conduit and fusion CMBS transactions on moodys.com at http://www.moodys.com/viewresearchdoc.aspx?docid=PBS_SF215255.

FACTORS THAT WOULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS:

The performance expectations for a given variable indicate Moody's forward-looking view of the likely range of performance over the medium term. Performance that falls outside the given range can indicate that the collateral's credit quality is stronger or weaker than Moody's had previously expected.

Factors that could lead to an upgrade of the ratings include a significant amount of loan paydowns or amortization, an increase in the pool's share of defeasance or an improvement in pool performance.

Factors that could lead to a downgrade of the ratings include a decline in the performance of the pool, loan concentration, an increase in realized and expected losses from specially serviced and troubled loans or interest shortfalls.

METHODOLOGY UNDERLYING THE RATING ACTION

The principal methodology used in rating all classes except interest-only classes was "Approach to Rating US and Canadian Conduit/Fusion CMBS" published in July 2017. The methodologies used in rating interest-only classes were "Approach to Rating US and Canadian Conduit/Fusion CMBS" published in July 2017 and "Moody's Approach to Rating Structured Finance Interest Only (IO) Securities" published in February 2019. Please see the list of ratings at the top of this announcement to identify which classes are interest-only (indicated by the *). Please see the Rating Methodologies page on www.moodys.com for a copy of these methodologies.

DEAL PERFORMANCE

As of the April 2019 distribution date, the transaction's aggregate pooled certificate balance has decreased by 3% to $1.33 billion from $1.37 billion at securitization. The pooled certificates are collateralized by 83 mortgage loans ranging in size from less than 1% to 9% of the pool, with the top ten loans (excluding defeasance) constituting 43% of the pool. One loan, constituting 7% of the pooled balance, has an investment-grade structured credit assessment. Seven loans, constituting 11% of the pool, have defeased and are secured by US government securities.

One loan, the Courtyard by Marriott Portfolio, has junior debt with a current aggregate balance of $355 million (including the partially defeased portion) that is structured as a non-pooled classes ("rakes") existing inside of the trust.

Moody's uses a variation of Herf to measure the diversity of loan sizes, where a higher number represents greater diversity. Loan concentration has an important bearing on potential rating volatility, including the risk of multiple notch downgrades under adverse circumstances. The credit neutral Herf score is 40. The pooled loans have a Herf of 27, compared to 28 at Moody's last review.

Four loans, constituting 3% of the pool, are on the master servicer's watchlist. The watchlist includes loans that meet certain portfolio review guidelines established as part of the CRE Finance Council (CREFC) monthly reporting package. As part of Moody's ongoing monitoring of a transaction, the agency reviews the watchlist to assess which loans have material issues that could affect performance.

No loans have been liquidated from the pool. One loan, the DoubleTree Norwalk Loan $19.0 million -- 1.4% of the pooled balance, is currently in special servicing. The specially serviced loan is secured by a 265-room, full-service hotel, built in 1971 and located in Norwalk, CT. The loan transferred to special servicing effective April 2017 due to imminent monetary default as a resulting of declining revenue per available room ("RevPAR") from securitization. The loan became REO in September 2018. The special servicer indicated the asset was marketed for sale in the first quarter of 2019.

Moody's has also assumed a high default probability for one poorly performing loan, constituting 0.3% of the pool, and has estimated an aggregate loss of $11.4 million (a 51% expected loss on average) from the specially serviced and troubled loans.

Moody's received full year 2017 operating results for 98% of the pooled loans, and full or partial year 2018 operating results for 95% of the pooled loans (excluding specially serviced and defeased loans). Moody's weighted average pooled conduit LTV is 120%, compared to 119% at Moody's last review. Moody's conduit component excludes loans with structured credit assessments, defeased and CTL loans, and specially serviced and troubled loans. Moody's net cash flow (NCF) reflects a weighted average haircut of 21% to the most recently available net operating income (NOI). Moody's value reflects a weighted average capitalization rate of 9.7%.

Moody's actual and stressed conduit DSCRs on the pooled loans are 1.43X and 0.88X, respectively, compared to 1.49X and 0.87X at the last review. Moody's actual DSCR is based on Moody's NCF and the loan's actual debt service. Moody's stressed DSCR is based on Moody's NCF and a 9.25% stress rate the agency applied to the loan balance.

The loan with a structured credit assessment is the non-defeased portion of the Courtyard by Marriott Portfolio Loan ($90.3 million -- 6.8% of the pooled balance), which represents a pari-passu portion of a senior tranche in the amount of $254 million and a junior tranche in the amount of $320 million (excluding the defeased balance). The loan was originally secured by fee simple and leasehold interests in 65 Courtyard by Marriott hotel properties located across 29 states. Since securitization, part of the loan was defeased from the release of 13 properties. The defeased balance of the pooled portion in the trust is $9.7 million, which is excluded from the $90.3 million balance mentioned above. The loan is currently secured by fee simple and leasehold interests in 52 Courtyard by Marriott hotel properties containing 7,677 guestrooms. The outstanding rake bonds associated with this loan include Cl. CM-B (Moody's rated), Cl. CM-C, Cl. CM-D and Cl. CM-E. In aggregate, the rake bonds now total $355 million (including the partially defeased portion). The aggregate performance of the 52 remaining properties has improved since securitization primarily due to increases in RevPAR. Moody's structured credit assessment and stressed DSCR on the pooled portion are aa1 (sca.pd) and 2.56X, respectively.

The top three conduit loans represent 20.4% of the pooled balance. The largest loan is the 9200 & 9220 Sunset Loan ($120 million -- 9.0% of the pool), which represents a pari-passu portion of a $210 million senior mortgage loan. The loan is secured by two office buildings totaling 317,000 square feet (SF), located along Sunset Boulevard in West Hollywood, California. The collateral is of Class A quality and includes 9200 Sunset Boulevard, a 14-story 265,228 SF building constructed in 1971 and 9220 Sunset Boulevard, a three-story 51,943 SF building constructed in 1964. The properties are located between Beverly Hills and Hollywood Hills. As of September 2018, the properties were 96% leased, compared to 98% leased as of September 2017. The loan is interest only for the full term. Moody's LTV and stressed DSCR are 113% and 0.83X, the same as at the last review.

The second largest loan is the DFW/Raleigh Portfolio Loan ($94.3 million -- 7.1% of the pooled balance), which is secured by the Borrower's fee simple interest in a portfolio of six, garden-style multifamily complexes located in Raleigh, North Carolina and Dallas/Fort Worth, Texas. Three of the portfolio properties are located in the Benbrook, Irving, and Arlington submarkets of Dallas/Fort Worth. The other three properties are located in the Central, Northeast and Northwest Raleigh submarkets of Raleigh, North Carolina. In aggregate, the six complexes contain 1,856 units and are of Class B quality. As of December 2018, the weighted average occupancy rate for the portfolio was 91%, compared to 94% in December 2016. Property performance has improved since securitization due to an increase in rental revenue. Moody's LTV and stressed DSCR are 121% and 0.81X, respectively, respectively, compared to 126% and 0.85X at Moody's last review.

The third largest loan is the Maui Coast Hotel Loan ($56.3 million -- 4.2% of the pooled balance), which is secured by the borrower's fee simple interest in a 265-guestroom, full-service hotel, located on the southwest coast of the island of Maui in the city of Kihei in Hawaii. The property was built in 1993 and most recently renovated in 2009. For the trailing twelve month (TTM) period ending February 2019, the hotel was 79.8% occupied, with an ADR of $255.6 resulting in a RevPAR of $204, compared to an occupancy, ADR and RevPAR of 83.2%, $227.0 and $189, respectively, for the same period ending February 2018. The loan is interest only throughout the entire 10-year loan term. Moody's LTV and stressed DSCR are 127% and 0.90X, respectively, the same as at the last review.

REGULATORY DISCLOSURES

For further specification of Moody's key rating assumptions and sensitivity analysis, see the sections Methodology Assumptions and Sensitivity to Assumptions of the disclosure form.

The analysis includes an assessment of collateral characteristics and performance to determine the expected collateral loss or a range of expected collateral losses or cash flows to the rated instruments. As a second step, Moody's estimates expected collateral losses or cash flows using a quantitative tool that takes into account credit enhancement, loss allocation and other structural features, to derive the expected loss for each rated instrument.

Moody's did not use any stress scenario simulations in its analysis.

For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

For any affected securities or rated entities receiving direct credit support from the primary entity(ies) of this credit rating action, and whose ratings may change as a result of this credit rating action, the associated regulatory disclosures will be those of the guarantor entity. Exceptions to this approach exist for the following disclosures, if applicable to jurisdiction: Ancillary Services, Disclosure to rated entity, Disclosure from rated entity.

Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.

Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating.

Kevin Li
Analyst
Structured Finance Group
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653

Matthew Halpern
Vice President - Sr Credit Officer
Structured Finance Group
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653

Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653

No Related Data.
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