Fitch Rates JPMC Commercial Mortgage Securities Trust 2015-COSMO Commercial Mtg P-T Certificates

CHICAGO--(BUSINESS WIRE)-- Fitch Ratings has assigned the following ratings and Rating Outlooks on J.P. Morgan Chase Commercial Mortgage Securities Trust 2015-COSMO commercial mortgage pass-through certificates series 2015-COSMO:

--$287,000,000 a class A 'AAAsf'; Outlook Stable;

--$78,000,000 a class B 'AA-sf'; Outlook Stable;

--$70,000,000 a class C 'A-sf'; Outlook Stable;

The following classes are not rated:

--$875,000,000 ab class X-CP;

--$875,000,000 ab class X-EXT;

--$222,200,000 a class D;

--$146,100,000 a class E;

--$71,700,000 a class F.

a Privately placed pursuant to Rule 144A.

b Notional amount and interest-only

The certificates represent the beneficial ownership in the trust, the primary asset of which is one loan having an aggregate principal balance of $875 million as of the cutoff date. The trust is secured by a first priority lien on the borrower's fee, condominium and operating leasehold interests in The Cosmopolitan of Las Vegas, a 2,959 room luxury hotel located along the Las Vegas Strip. The sponsor of the loan is Blackstone Real Estate Partners VII-NQ L.P., an affiliate of The Blackstone Group L.P. (rated 'A+'/'F1' with a Stable Outlook by Fitch). The loan was originated by JPMorgan Chase Bank, National Association (rated 'A+'/'F1' with a Stable Outlook).

KEY RATING DRIVERS

Asset Quality: The Cosmopolitan is a Class A luxury hotel and casino with an irreplaceable central location along Las Vegas Strip Corridor (the Strip) in Las Vegas, NV. It was built for approximately $3.8 billion and features high-end amenities and services.

Market Positioning: Since 2012, the property has consistently ranked among the top hotels on the Strip and commands the highest average daily rate (ADR; $307) of its competitive set ($240) as of year-end 2014. The Cosmopolitan has a more diverse revenue stream that other competitive hotels.

Exposure to Gaming Revenue: Approximately 22% of revenue at The Cosmopolitan is derived from gaming, a more volatile revenue stream. Between 2007 and 2010 Las Vegas gaming revenue declined approximately 20% in a recessionary environment. Although hotel management does not view current gaming performance to have reached a stabilized market level, Fitch discounted TTM ended January 2015 gaming revenue by the peak to trough drop of 20%.

Trust Leverage: Fitch's stressed DSCR and LTV for the trust component of the debt are 1.09x and 96.0%, respectively. The most junior class rated by Fitch, Class C, has an LTV of 47.7% and a DSCR of 2.19x.

New Cash Equity: As part of the acquisition, the sponsor Blackstone Real Estate Partners VII-NQ L.P., contributed $492 million of new cash equity.

RATING SENSITIVITIES

Fitch found that the property could withstand an 84.2% decline in value and an approximate 73.0% decrease in the Fitch's net cash flow prior to experiencing $1 of loss to the 'AAAsf' rated class A.

Fitch performed several stress scenarios in which the Fitch net cash flow (NCF) was stressed. Fitch determined that a 73.7% reduction in Fitch's NCF would cause the notes to break even at a 1.0x DSCR, based on the actual debt service.

Fitch evaluated the sensitivity of the ratings for class A and found that an 8.2% decline in Fitch NCF would result in a one-category downgrade, while a 43.6% decline would result in a downgrade to below investment grade.

The Rating Sensitivities section in the presale report includes a detailed explanation of additional stresses and sensitivities. Key Rating Drivers and Rating Sensitivities are further described in the accompanying presale report. The presale report is available to all investors on Fitch's web site 'www.fitchratings.com'.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'Criteria for Analyzing Large Loans in U.S. Commercial Mortgage Transactions' (March 2015);

--'Criteria for Analyzing Multiborrower U.S. Commercial Mortgage Transactions' (June 2014);

--'Global Structured Finance Rating Criteria (August 2014)

--'Rating Criteria for U.S. Commercial Mortgage Servicers' (February 2014);

--'Counterparty Criteria for Structured Finance and Covered Bonds' (May 2014);

--'Surveillance Criteria for U.S. CREL CDOs and CMBS Large Loan Floating-Rate Transactions' (November 2013).

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=982150

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.

Fitch Ratings
Primary Analyst
Michael Vidmar
Associate Director
+1-312-368-3331
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Secondary Analyst
Lauren Cerda
Senior Director
+1-312-606-2317
or
Committee Chairperson
Eric Rothfeld
Managing Director
+1-212-908-0761
or
Media Relations:
Sandro Scenga, +1-212-908-0278
[email protected]

Source: Fitch Ratings

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