J.P. Morgan Chase plans to issue $1.2 billion of securities backed by a pool of 73 commercial mortgages loans that are secured by 84 properties.
Fitch Ratings and DBRS have assigned preliminary rating to the notes issued under JPMBB Commercial Mortgage Securities Trust 2014-C21.
The capital structure will offer $924.5 million of AAA’ rated securities; $90.11 of AA’ rated securities; $45.8 million of A’ rated securities; $74.3 million of BBB’ rated securities; $25.2 million of BB’ rated securities; and $17.3 million of B’ rated securities. The BBB’ rated notes and below will be placed privately. The note are due August 2047.
Six of the loans, which comprise 14.1% of the pool, are secured by hotels, which have the highest cash flow volatility of all major property types.
Four loans —Ann Arbor Student Housing Portfolio, Packard and Thomson Apartments, Chesterfield Apartments and Stuart Court Apartments —represent 3.1% of the pool and are secured by student housing properties.
The combined partial IO and full-term IO concentration is 72.4%. There are eight loans that are IO for the full term, representing 24.3% of the pool, all of which are in the top 17 loans. Overall, this results in a relatively low level of amortization during the loan term of -9.8%.
The third largest loan in the pool, Miami International Mall which accounts for 4.7% of the pool is a $60 million, pari passu portion of a $160 million loan. The $100 million note was securitized in the JPMBB 2014-C18 transaction. According to the Fitch presale, the loan pool has a total of seven pari passu loans (25.9%), including five loans within the top 15 (20.4%).
Fitch notes in its presale report that the deal LTV of 108.5% is higher than the 2013 average of 101.6%. At the same time the pools debt service coverage ratio of 1.13x is below the 2013 average of 1.29x.