DBRS Morningstar Confirms All Ratings on BBCMS Mortgage Trust 2020-C6

DBRS, Inc. (DBRS Morningstar) confirmed its ratings on the Commercial Mortgage Pass-Through Certificates, Series 2020-C6 issued by BBCMS Mortgage Trust 2020-C6 as follows:

-- Class A-1 at AAA (sf)
-- Class A-2 at AAA (sf)
-- Class A-3 at AAA (sf)
-- Class A-4 at AAA (sf)
-- Class A-S at AAA (sf)
-- Class A-SB at AAA (sf)
-- Class X-A at AAA (sf)
-- Class B at AA (high) (sf)
-- Class X-B at A (high) (sf)
-- Class C at A (sf)
-- Class D at A (low) (sf)
-- Class X-D at BBB (high) (sf)
-- Class E at BBB (sf)
-- Class F-RR at BBB (low) (sf)
-- Class G-RR at BB (sf)
-- Class H-RR at B (high) (sf)
-- Class J-RR at B (low) (sf)

DBRS Morningstar also confirmed its ratings on the loan-specific certificates as follows:

-- Class F5T-A at A (low) (sf)
-- Class F5T-B at BBB (low) (sf)
-- Class F5T-C at BB (low) (sf)
-- Class F5T-D at B (low) (sf)

All trends are Stable.

The rating confirmations reflect the overall stable performance of the underlying loans in the transaction since the last rating action. At issuance, the trust consisted of 45 fixed-rate loans secured by 118 commercial and multifamily properties with initial trust balance of $1.02 billion. As of the January 2022 remittance report, all loans remain in the pool and the trust has seen only nominal collateral reduction of 0.4% since issuance. To date, no loans have defeased. Amortization has been limited, as 25 of the loans, representing 70.1% of the current pool balance, are structured as interest only (IO) for their full term and an additional six loans, representing another 14.4%, were structured as partial IO and remain in their initial IO periods.

The pool’s property type concentration is relatively diverse, with the highest property type concentration by loan balance consisting of office properties (six loans representing 28.9% of the current pool balance). Mixed-use assets account for the second-highest property type concentration, with seven loans that represent 20.9% of the current pool balance. Multifamily assets account for the third-largest property type concentration, with 10 loans representing 15.2% of the current pool balance.

At issuance, DBRS Morningstar assigned an investment-grade shadow rating to five loans (all of which are included in the largest 10 loans): Prospectus ID#1 – Parkmerced (7.2% of the current pool); Prospectus ID#2 – 650 Madison Avenue (6.7% of the current pool); Prospectus ID#3 – Kings Plaza (6.7% of the current pool); Prospectus ID#5 – F5 Tower (5.6% of the current pool); and Prospectus ID#7 – Bellagio Hotel and Casino (4.9% of the current pool). With this review, DBRS Morningstar confirmed that the respective performance of each of these loans remains consistent with the characteristics of an investment-grade loan.

As of the January 2022 remittance period, there were 10 loans on the servicer’s watchlist, representing 23.9% of the current pool balance, including three loans in the top 15, totaling 14.0% of the current pool balance. Generally speaking, most loans on the watchlist were added for low debt service coverage ratios (DSCR) compared with issuance, but only four loans, representing 5.0% of the current pool balance, reported YE2020 DSCRs below 1.0 times. There were no loans in special servicing.

The loan-specific Class F5T-A, F5T-B, F5T-C, and F5T-D certificates are backed by the $112.6 million subordinate companion loan of the $297.6 million F5 Tower whole loan, which is secured by 515,518 square feet of Class A office space and a 259-space underground parking garage in Seattle. The office space is 100% occupied by F5 Networks, Inc., which uses the space as its headquarters, on a lease through September 2033. The loan-specific certificates are not pooled with the remainder of the trust loans. With this review, DBRS Morningstar confirmed that the performance of the underlying loan remains in line with the expectations at issuance, supporting the rating confirmations for those classes.

A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://www.dbrsmorningstar.com/research/373262.

Classes X-A, X-B, and X-D are IO certificates that reference a single rated tranche or multiple rated tranches. The IO rating mirrors the lowest-rated applicable reference obligation tranche adjusted upward by one notch if senior in the waterfall.

All ratings are subject to surveillance, which could result in ratings being upgraded, downgraded, placed under review, confirmed, or discontinued by DBRS Morningstar.

DBRS Morningstar provides updated analysis and in-depth commentary in the DBRS Viewpoint platform for the following loans in the transaction:

-- Prospectus ID#9 – CNP Headquarters (3.8% of the pool)

For complimentary access to this content, please register for the DBRS Viewpoint platform at www.viewpoint.dbrsmorningstar.com. The platform includes issuer and servicer data for most outstanding CMBS transactions (including non-DBRS Morningstar rated), as well as loan-level and transaction-level commentary for most DBRS Morningstar-rated and -monitored transactions.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The principal methodology is the North American CMBS Surveillance Methodology (March 26, 2021), which can be found on dbrsmorningstar.com under Methodologies & Criteria. For a list of the structured-finance-related methodologies that may be used during the rating process, please see the DBRS Morningstar Global Structured Finance Related Methodologies document, which can be found on dbrsmorningstar.com in the Commentary tab under Regulatory Affairs. Please note that not every related methodology listed under a principal structured finance asset class methodology may be used to rate or monitor an individual structured finance or debt obligation.

The DBRS Morningstar Sovereign group releases baseline macroeconomic scenarios for rated sovereigns. DBRS Morningstar analysis considered impacts consistent with the baseline scenarios as set forth in the following report: https://www.dbrsmorningstar.com/research/384482/baseline-macroeconomic-scenarios-application-to-credit-ratings.

The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the rating process.

For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at info@dbrsmorningstar.com.

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