DBRS Morningstar Confirms All Classes of Wells Fargo Commercial Mortgage Trust 2015-NXS1

DBRS Limited (DBRS Morningstar) confirmed the ratings on all classes of the Commercial Mortgage Pass-Through Certificates, Series 2015-NXS1 issued by Wells Fargo Commercial Mortgage Trust 2015-NXS1 as follows:

-- Class A-2 at AAA (sf)
-- Class A-3 at AAA (sf)
-- Class A-4 at AAA (sf)
-- Class A-5 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 (low) (sf)
-- Class X-B at A (sf)
-- Class C at A (low) (sf)
-- Class PEX at A (low) (sf)
-- Class D at BBB (low) (sf)
-- Class X-E at BB (sf)
-- Class E at BB (low) (sf)
-- Class X-F at B (high) (sf)
-- Class F at B (sf)

All trends are Stable.

The rating confirmations reflect the overall stable performance of the transaction since the last DBRS Morningstar rating action in March 2021. As of the January 2022 remittance, 61 of the original 68 loans remain in the pool, with an aggregate principal balance of $738.4 million, representing a collateral reduction of 22.7% since issuance. Seven loans, representing 11.2% of the current trust balance, are fully defeased. The transaction is concentrated by property type as 14 loans, representing 39.0% of the current trust balance, are secured by office properties. Two loans, representing 5.7% of the current trust balance, are in special servicing and 10 loans, representing 18.0% of the pool, are being monitored on the servicer’s watchlist.

The transaction’s largest specially serviced loan, Hotel Andra (Prospectus ID#13; 3.1% of the pool), is secured by a 119-room boutique hotel in downtown Seattle. The loan transferred to special servicing in April 2020 at the borrower’s request because of imminent default and remains delinquent. The property was closed from April 2020 through July 2021. In July 2021, the servicer reported that the borrower expressed a desire to cure the loan and a forbearance agreement was executed. The terms of the forbearance include a retroactive principal and interest deferral period and a waiver of monthly furniture, fixtures, and equipment (FF&E) reserve deposits. Deferred principal and interest are to be repaid over 18 months, starting in May 2022. As part of the forbearance agreement, the borrower will also contribute $9.5 million into an FF&E reserve, which will be used to complete various renovations. The loan will continue to be monitored and is ultimately expected to be returned to the master servicer. The property was appraised in June 2021 at a value of $41.9 million, a 23.5% decrease from the issuance value of $54.8 million. Following the completion of the renovations and subsequent stabilization of property operations, the appraiser projected a value of $56.4 million with a projected stabilization date of June 2024.

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, X-E, and X-F are interest-only (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#13 – Hotel Andra (3.1% 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 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 related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link under Related Documents or by contacting us at info@dbrsmorningstar.com.

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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