DBRS Morningstar Confirms Ratings of GS Mortgage Securities Corporation Trust 2021-IP

DBRS Limited (DBRS Morningstar) confirmed its ratings on the following classes of Commercial Mortgage Pass-Through Certificates, Series 2021-IP as follows:

-- Class A at AAA (sf)
-- Class B at AA (low) (sf)
-- Class C at A (sf)
-- Class D at BBB (high) (sf)
-- Class E at BBB (low) (sf)
-- Class F at BB (sf)
-- Class HRR at BB (low) (sf)

All trends are Stable.

The rating confirmations reflect the stable performance of the transaction, which has remained in line with DBRS Morningstar expectations at issuance. The interest-only loan is secured by the borrower’s fee-simple and leasehold interest in the nondepartment store component of International Plaza, a 1.2 million-square-foot (sf) Class A super-regional mall, of which approximately 740,000 sf serves as collateral for the loan. The property is four miles west of downtown Tampa and is anchored by noncollateral tenants in Neiman Marcus, Nordstrom, and Dillard’s. The subject features two additional anchor boxes on the first and second floors, of which the first floor space serves as collateral and is primarily occupied by Lifetime Athletic, while the second floor space was formerly occupied by Lord & Taylor. The second floor was divided up, and about 20,000 sf was backfilled by Ballard Designs, but the remaining 50,000 sf of the space has been vacant for approximately 10 years and is currently used as storage space.

As of the March 2022 rent roll, the collateral was 95.9% occupied, with the largest in-line tenants including Lifetime Athletic (7.6% of net rentable area (NRA), lease expiry in January 2029), Forever 21 (4.7% of NRA, lease expiry in January 2022), Crate & Barrel (4.5% of NRA, lease expiry in January 2024), and H&M (2.9% of NRA, lease expiry in January 2022). There is notable rollover risk with approximately 25.0% of NRA with lease expirations within the next 12 months, including Forever 21 and H&M, which was contemplated at issuance. Both of these tenants continue to be on the property’s online directory to date. An updated tenant sales report was not provided; however, at issuance, it was noted that in-line sales during the trailing 12-month (T-12) period ended May 31, 2021, was at $820 per square foot (psf) when excluding Apple and Tesla, while total sales for that same period in 2019 were noted at $789 psf. As of the most recent financials dated March 2022, on a trailing three-month (T-3) basis, the loan reported a debt service coverage ratio (DSCR) of 5.66 times (x) and an annualized net cash flow (NCF) of $56.5 million, compared with the DBRS Morningstar DSCR of 3.63x and NCF of $38.4 million.

ENVIRONMENTAL, SOCIAL, GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance factors that had a significant or relevant effect on the credit analysis.

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/396929/dbrs-morningstar-criteria-approach-to-environmental-social-and-governance-risk-factors-in-credit-ratings.

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 this transaction.

The DBRS Viewpoint platform provides additional information on this transaction and underlying loans including DBRS Morningstar metrics, commentary, servicer-reported cash flows, and other performance-related data. For complimentary access to this content, please register for the DBRS Viewpoint platform at www.viewpoint.dbrsmorningstar.com.

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

The principal methodology is North American CMBS Surveillance Methodology (March 4, 2022), 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.

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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