Wells Fargo is securitizing $712 million in commercial mortgages with heavy exposure to offices and self-storage facilities. The collateral is also less heavily concentrated compared to other CMBS deals covered by Fitch Ratings.

The Wells Fargo Commercial Mortgage Trust 2016-C33 will issue 17 classes of floating-rate, fixed-rate and interest only notes, including five tranches of super senior Class A notes totaling $498.5 million benefitting from credit enhancement of 30%. A senior $53.4 million Class A-S tranche has 22.5% credit enhancement.  All are rated ‘AAA’ by Fitch.

The pool includes 79 mortgages backed by 104 properties, and an average loan size of $9 million (which is in line with recent Wells commercial mortgage securitizations).

The biggest concentration by property types is offices, which account for 32.4% of the pool – greater than the average securitization average of 23.5% for that business type in recent Fitch-rated deals. There is also an above-average concentration of self-storage properties at 14% of the pool (compared to the 2015 average of 4% in other Fitch-rated transactions), and a below average mix of hotels (13% compared to a 2015 peer average of 17%).  

Also, the top 10 loans in the pool represent a smaller portion than other peer transactions: only 45.5% of the total, below the year-to-date 2016 average of 56.4% for similarly rated CMBS deals (but on par with Wells’ prior 2015-LC22 transaction.

In comparison to prior Wells CMBS transactions, 2016-C33 features a slightly higher weighted mortgage rate average of 4.45% for its 2015 deals. 

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