Fitch Ratings has upgraded three classes and affirmed four classes of
RATING ACTIONS
Entity / Debt
Rating
Prior
MSJP 2015-HAUL
A 553697AA1
LT
AAAsf
Affirmed
AAAsf
B 553697AG8
LT
AAAsf
Affirmed
AAAsf
C 553697AJ2
LT
AAAsf
Upgrade
AAsf
D 553697AL7
LT
Asf
Upgrade
BBB-sf
E 553697AN3
LT
BBBsf
Upgrade
BBsf
X-A 553697AC7
LT
AAAsf
Affirmed
AAAsf
X-B 553697AE3
LT
AAAsf
Affirmed
AAAsf
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VIEW ADDITIONAL RATING DETAILS
KEY RATING DRIVERS
Generally Stable Collateral Performance: The class upgrades and Positive Rating Outlooks maintained on Classes D and E are the result of stable-to-improved occupancy and gross potential rent since the last rating action, as well as the continued amortization of the total debt (non-pooled loan) as expected since issuance. The non-pooled loan has paid down 64.3% since issuance and 23% since Fitch's last rating action. The portfolio's occupancy has increased from 77.5% in 2010 to 93.4% as of YE 2021, 88.1% in YE 2020 and 84.1% as of YE 2019.
The master servicer's reported net cash flow (NCF) includes income and related expenses from
Fitch has inquired about these increases from the servicer. The YE 2021 Fitch-stressed NCF is 7.5% above the Fitch YE 2020 NCF and 11.5% below the Fitch issuance NCF, largely due to the increased operating expenses. Fitch's analysis is based on certain expense line-item assumptions, using both issuance levels, which were normalized for collateral expense items only, as well as some of the reported increases.
Fully Amortizing Loan and Fitch Leverage: The whole loan is structured with a 20-year amortization schedule providing full amortization over the term of the loan. The trust notes are scheduled to be interest-only for the first 10 years and the non-trust
Collateral: The certificates represent the beneficial interest in a 20-year, fixed-rate, mortgage loan secured by 105 cross-collateralized self-storage properties located across 35 states owned by
Granular Portfolio: The loan is secured by 105 cross-collateralized self-storage properties located across 35 states. No single property represents more than 3.7% of YE 2021 NOI.
Experienced Sponsorship and Management: The loan is sponsored by
The portfolio is managed by
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative rating action/downgrade:
A significant decline in portfolio occupancy;
A significant deterioration in property cash flow.
Fitch has identified both a baseline and a worse-than-expected, adverse stagflation scenario based on fallout from the
Factors that could, individually or collectively, lead to positive rating action/upgrade:
Fitch rates classes A, B, C, X-A and X-B 'AAAsf', and therefore upgrades are not possible. The Positive Outlooks maintained on classes D and E reflect likely upgrades in one to two years with sustained stable cash flow and continued amortization. The Stable Outlooks for all other classes reflect the relatively stable performance that is consistent with issuance and reduction in the loan balance due to scheduled amortization. If performance remains stable, classes are likely to continue to be upgraded as amortization results in increased credit enhancement.
Best/Worst Case Rating Scenario
International scale credit ratings of Structured Finance transactions have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of seven notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of seven notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAAsf' to 'Dsf'. Best- and worst-case scenario credit ratings are based on historical performance. For more information about the methodology used to determine sector-specific best- and worst-case scenario credit ratings, visit https://www.fitchratings.com/site/re/10111579.
USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10
Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING
The principal sources of information used in the analysis are described in the Applicable Criteria.
ESG Considerations
Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. For more information on Fitch's ESG Relevance Scores, visit www.fitchratings.com/esg
Additional information is available on www.fitchratings.com
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