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JP Morgan Chase Commercial Mortgage Securities

Filed: 8 Oct 20, 2:32pm

  FREE WRITING PROSPECTUS
  FILED PURSUANT TO RULE 433
  REGISTRATION FILE NO.: 333-226123-10
   

 

October [7], 2020Benchmark 2020-B20

 

 

 
 
Collateral Term Sheet

 

BENCHMARK 2020-B20

 

 

 

 

This material is for your information, and none of J.P. Morgan Securities LLC (“JPMS”), Deutsche Bank Securities Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, Drexel Hamilton, LLC and Academy Securities, Inc., (each individually, an “Underwriter”, and together, the ‘‘Underwriters’’) are soliciting any action based upon it. This material is not to be construed as an offer to sell or the solicitation of any offer to buy any security in any jurisdiction where such an offer or solicitation would be illegal.

 

The depositor has filed a registration statement (including a prospectus) with the SEC (SEC File No. 333-226123) for the offering to which this free writing prospectus relates. Before you invest, you should read the prospectus in the registration statement and other documents the depositor has filed with the SEC for more complete information about the depositor, the issuing entity and this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the depositor, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling (800) 408-1016 or by emailing the ABS Syndicate Desk at abs_synd@jpmorgan.com.

 

THE SECURITIES TO WHICH THIS INFORMATION RELATES WILL BE MORE FULLY DESCRIBED IN A PROSPECTUS (THE “PROSPECTUS”), WHICH IS NOT YET AVAILABLE. THE PROSPECTUS WILL CONTAIN MATERIAL INFORMATION THAT IS NOT CONTAINED IN THESE MATERIALS (INCLUDING WITHOUT LIMITATION A DETAILED DISCUSSION OF RISKS ASSOCIATED WITH AN INVESTMENT IN THE CERTIFICATES, UNDER THE HEADING “RISK FACTORS” IN THE PROSPECTUS).

 

Neither this document nor anything contained in this document shall form the basis for any contract or commitment whatsoever. The information contained in this document is preliminary as of the date of this document, supersedes any previous such information delivered to you and will be superseded by any such information subsequently delivered prior to the time of sale. These materials are subject to change, completion or amendment from time to time. This information is based upon management forecasts and reflects prevailing conditions and management's views as of this date, all of which are subject to change.

 

J.P. Morgan is the marketing name for the investment banking businesses of JPMorgan Chase & Co. and its subsidiaries worldwide. Securities, syndicated loan arranging, financial advisory and other investment banking activities are performed by JPMS and its securities affiliates, and lending, derivatives and other commercial banking activities are performed by JPMorgan Chase Bank, National Association and its banking affiliates. JPMS is a member of SIPC and the NYSE.

 

THE CERTIFICATES REFERRED TO IN THESE MATERIALS ARE SUBJECT TO MODIFICATION OR REVISION (INCLUDING THE POSSIBILITY THAT ONE OR MORE CLASSES OF CERTIFICATES MAY BE SPLIT, COMBINED OR ELIMINATED AT ANY TIME PRIOR TO ISSUANCE OR AVAILABILITY OF A FINAL PROSPECTUS) AND ARE OFFERED ON A “WHEN, AS AND IF ISSUED” BASIS.

 

THE UNDERWRITERS MAY FROM TIME TO TIME PERFORM INVESTMENT BANKING SERVICES FOR, OR SOLICIT INVESTMENT BANKING BUSINESS FROM, ANY COMPANY NAMED IN THESE MATERIALS. THE UNDERWRITERS AND/OR THEIR AFFILIATES OR RESPECTIVE EMPLOYEES MAY FROM TIME TO TIME HAVE A LONG OR SHORT POSITION IN ANY CERTIFICATE OR CONTRACT DISCUSSED IN THESE MATERIALS. 

 

  

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 

 

 

 

October [7], 2020Benchmark 2020-B20

 

THE REPUBLIC OF KOREA

 

THIS PROSPECTUS IS NOT, AND UNDER NO CIRCUMSTANCES IS THIS PROSPECTUS TO BE CONSTRUED AS, A PUBLIC OFFERING OF SECURITIES IN KOREA. NEITHER THE ISSUER NOR ANY OF ITS AGENTS MAKE ANY REPRESENTATION WITH RESPECT TO THE ELIGIBILITY OF ANY RECIPIENTS OF THIS PROSPECTUS TO ACQUIRE THE OFFERED CERTIFICATES UNDER THE LAWS OF KOREA, INCLUDING, BUT WITHOUT LIMITATION, THE FOREIGN EXCHANGE TRANSACTION LAW AND REGULATIONS THEREUNDER (THE “FETL”). THE OFFERED CERTIFICATES HAVE NOT BEEN REGISTERED WITH THE FINANCIAL SERVICES COMMISSION OF KOREA FOR PUBLIC OFFERING IN KOREA, AND NONE OF THE OFFERED CERTIFICATES MAY BE OFFERED, SOLD OR DELIVERED, DIRECTLY OR INDIRECTLY, OR OFFERED OR SOLD TO ANY PERSON FOR RE-OFFERING OR RESALE, DIRECTLY OR INDIRECTLY IN KOREA OR TO ANY RESIDENT OF KOREA EXCEPT PURSUANT TO THE FINANCIAL INVESTMENT SERVICES AND CAPITAL MARKETS ACT AND THE DECREES AND REGULATIONS THEREUNDER (THE “FSCMA”), THE FETL AND ANY OTHER APPLICABLE LAWS, REGULATIONS AND MINISTERIAL GUIDELINES IN KOREA. WITHOUT PREJUDICE TO THE FOREGOING, THE NUMBER OF OFFERED CERTIFICATES OFFERED IN KOREA OR TO A RESIDENT OF KOREA SHALL BE LESS THAN FIFTY AND FOR A PERIOD OF ONE YEAR FROM THE ISSUE DATE OF THE OFFERED CERTIFICATES, NONE OF THE OFFERED CERTIFICATES MAY BE DIVIDED RESULTING IN AN INCREASED NUMBER OF OFFERED CERTIFICATES. FURTHERMORE, THE OFFERED CERTIFICATES MAY NOT BE RESOLD TO KOREAN RESIDENTS UNLESS THE PURCHASER OF THE OFFERED CERTIFICATES COMPLIES WITH ALL APPLICABLE REGULATORY REQUIREMENTS (INCLUDING, BUT NOT LIMITED TO, GOVERNMENT REPORTING APPROVAL REQUIREMENTS UNDER THE FETL AND ITS SUBORDINATE DECREES AND REGULATIONS) IN CONNECTION WITH THE PURCHASE OF THE OFFERED CERTIFICATES.

 

JAPAN

 

THE OFFERED CERTIFICATES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE FINANCIAL INSTRUMENTS AND EXCHANGE LAW OF JAPAN, AS AMENDED (THE “FIEL”), AND DISCLOSURE UNDER THE FIEL HAS NOT BEEN AND WILL NOT BE MADE WITH RESPECT TO THE OFFERED CERTIFICATES. ACCORDINGLY, EACH UNDERWRITER HAS REPRESENTED AND AGREED THAT IT HAS NOT, DIRECTLY OR INDIRECTLY, OFFERED OR SOLD AND WILL NOT, DIRECTLY OR INDIRECTLY, OFFER OR SELL ANY OFFERED CERTIFICATES IN JAPAN OR TO, OR FOR THE BENEFIT OF, ANY RESIDENT OF JAPAN (WHICH TERM AS USED IN THIS PROSPECTUS MEANS ANY PERSON RESIDENT IN JAPAN, INCLUDING ANY CORPORATION OR OTHER ENTITY ORGANIZED UNDER THE LAWS OF JAPAN) OR TO OTHERS FOR REOFFERING OR RE-SALE, DIRECTLY OR INDIRECTLY, IN JAPAN OR TO, OR FOR THE BENEFIT OF, ANY RESIDENT OF JAPAN EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF, AND OTHERWISE IN COMPLIANCE WITH, THE FIEL AND OTHER RELEVANT LAWS, REGULATIONS AND MINISTERIAL GUIDELINES OF JAPAN. AS PART OF THIS OFFERING OF THE OFFERED CERTIFICATES, THE UNDERWRITERS MAY OFFER THE OFFERED CERTIFICATES IN JAPAN TO UP TO 49 OFFEREES IN ACCORDANCE WITH THE ABOVE PROVISIONS.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20

 

Collateral Characteristics

 

Loan Pool 
Initial Pool Balance (“IPB”):$903,488,876
Number of Mortgage Loans:34
Number of Mortgaged Properties:89
Average Cut-off Date Balance per Mortgage Loan:$26,573,202
Weighted Average Current Mortgage Rate:3.56841%
10 Largest Mortgage Loans as % of IPB:55.7%
Weighted Average Remaining Term to Maturity(1):109 months
Weighted Average Seasoning:2 months
Credit Statistics 
Weighted Average UW NCF DSCR(2)(3):2.71x
Weighted Average UW NOI DY(2)(3):10.9%
Weighted Average Cut-off Date Loan-to-Value Ratio (“LTV”)(2)(3)(4):56.0%
Weighted Average Maturity Date LTV(1)(2)(3)(4):53.5%
Other Statistics 
% of Mortgage Loans with Additional Debt:22.7%
% of Mortgaged Properties with Single Tenants:36.9%
Amortization 
Weighted Average Original Amortization Term(5):349 months
Weighted Average Remaining Amortization Term(5):349 months
% of Mortgage Loans with Interest-Only:65.4%
% of Mortgage Loans with Partial Interest-Only followed by Amortizing Balloon:12.1%
% of Mortgage Loans with Amortizing Balloon:12.0%
% of Mortgage Loans with ARD-Interest Only:10.5%
Lockbox / Cash Management(6) 
% of Mortgage Loans with In-Place, Hard Lockboxes:81.8%
% of Mortgage Loans with Springing Lockboxes:17.4%
% of Mortgage Loans with In-Place, Soft Lockboxes:0.8%
% of Mortgage Loans with Springing Cash Management:85.1%
% of Mortgage Loans with In-Place Cash Management:14.9%
Reserves 
% of Mortgage Loans Requiring Monthly Tax Reserves:70.2%
% of Mortgage Loans Requiring Monthly Insurance Reserves:31.9%
% of Mortgage Loans Requiring Monthly CapEx Reserves(7):50.3%
% of Mortgage Loans Requiring Monthly TI/LC Reserves(8):54.8%

 

(1)In the case of Loan Nos. 3 and 16, with an anticipated repayment date, Remaining Term to Maturity and Maturity Date LTV are calculated as of the related anticipated repayment date.

(2)In the case of Loan Nos. 1, 2, 3, 4, 6, 9, 11, 12, 16, 17, 18, 19 and 23, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV Ratio calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 3, 9, and 17, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s) and/or related mezzanine loan(s).

(3)In the case of Loan No. 21, the UW NOI DY, Cut-Off Date LTV and Maturity Date LTV are calculated net of a holdback reserve. In the case of Loan No. 3, the UW NCF DSCR and UW NOI DY are calculated based on the master lease annual rent of $292,000,000.

(4)In the case of Loan Nos. 1, 3, 6, 7, 16, 18, and 20, the Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details.

(5)Excludes 24 mortgage loans that are interest-only for the entire term.

(6)For a more detailed description of Lockbox / Cash Management, refer to “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—Mortgaged Property Accounts” in the Preliminary Prospectus.

(7)CapEx Reserves include FF&E reserves for hotel properties.

(8)Calculated only with respect to the Cut-off Date Balance of mortgage loans secured or partially secured by retail, office, industrial and mixed use properties.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20

 

Collateral Characteristics

 

Mortgage Loan Seller 

Number of Mortgage Loans 

Number of Mortgaged PropertiesAggregate Cut-off Date Balance

% of IPB 

CREFI1218$252,572,750   28.0%
GSMC(1)(2)1011  195,080,00021.6
GACC(3)(4)79  193,336,12621.4
JPMCB348  122,500,00013.6
CREFI/GACC(3)(5)12   70,000,000  7.7
JPMCB/CREFI(6)11   70,000,000  7.7
Total3489$903,488,876100.0%
(1)Eight of the mortgage loans (16.1%) being sold by Goldman Sachs Mortgage Company (GSMC”) were originated or co-originated by an affiliate thereof, Goldman Sachs Bank USA, and will be transferred to GSMC on or prior to the Closing Date.

(2)In the case of Loan No. 11, the whole loan was co-originated by Goldman Sachs Bank USA (“GSBI”), American General Life Insurance Company, The Variable Annuity Life Insurance Company, National Union Fire Insurance Company of Pittsburgh, PA. and American Home Assurance Company. In the case of Loan No. 23, the whole loan was co-originated by GSBI and Bank of America, N.A.

(3)Each mortgage loan being sold by German American Capital Corporation (“GACC”) was originated or co-originated, either DBR Investments Co. Limited or Deutsche Bank AG, New York Branch, each an affiliate of GACC and will be transferred to GACC on or prior to the Closing Date.

(4)In the case of Loan No. 1, the whole loan was co-originated by DBR Investments Co. Limited and JPMCB.

(5)In the case of Loan No. 3, the whole loan was co-originated by CREFI, Barclays Capital Real Estate Inc., Deutsche Bank AG, New York Branch and Société Générale Financial Corporation. Loan No. 3 is evidenced by two promissory notes: (i) Note A-13-4, with a principal balance of $46,666,667 as of the Cut-off Date, as to which CREFI is acting as mortgage loan seller, and (ii) Note A-15-4, with a principal balance of $23,333,333 as of the Cut-off Date, as to which GACC is acting as mortgage loan seller.

(6)In the case of Loan No. 2, the whole loan was co-originated by Wells Fargo Bank, National Association, JPMCB and CREFI. Loan No. 2 is evidenced by four promissory notes: (i) Note A-4 and Note A-5, with an aggregate principal balance of $35,000,000 as of the Cut-off Date, as to which JPMCB is acting as mortgage loan seller, and (ii) Note A-6 and Note A-7, with an aggregate principal balance of $35,000,000 as of the Cut-off Date, as to which CREFI is acting as mortgage loan seller.

 

Ten Largest Mortgage Loans

 

No.Loan NameMortgage Loan SellerNo. of Prop.Cut-off Date Balance% of IPBSF / UnitsProperty TypeUW NCF DSCR(1)(2)UW NOI DY(1)(2)Cut-off Date LTV(1)(3)Maturity Date LTV(1)(3)(4)
1Moffett Place - Building 6GACC1$74,850,0008.3%314,352Office3.50x12.2%37.1%37.1%
2120 Wall StreetJPMCB/CREFI1$70,000,0007.7%668,276Office2.74x9.3%57.9%57.9%
3MGM Grand & Mandalay BayCREFI/GACC2$70,000,0007.7%9,748Hotel4.95x17.9%35.5%35.5%
44 West 58th StreetJPMCB1$62,500,0006.9%83,537Mixed Use1.94x7.4%69.4%69.4%
5Northern Trust OfficeCREFI1$40,400,0004.5%149,371Office2.58x9.4%62.6%62.6%
6Coleman HighlineGACC1$40,000,0004.4%380,951Office3.64x10.3%50.8%50.8%
7Point West PortfolioGACC3$39,500,0004.4%346,227Office3.30x11.7%59.4%59.4%
8Skywater Technology HQCREFI1$39,000,0004.3%393,765Industrial1.80x11.5%49.5%34.8%
9Agellan PortfolioJPMCB46$35,000,0003.9%6,094,177Various3.03x15.7%41.9%41.9%
102010 South LamarCREFI1$32,100,0003.6%80,067Office2.17x9.5%59.9%59.9%

 

Top 3 Total/Weighted Average4$214,850,00023.8%  3.72x13.1%43.4%43.4%
Top 5 Total/Weighted Average6$317,750,00035.2%  3.23x11.5%50.9%50.9%
Top 10 Total/Weighted Average58$503,350,00055.7%  3.07x11.6%51.4%50.3%
(1)In the case of Loan Nos. 1, 2, 3, 4, 6 and 9 the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV Ratio calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 3 and 9, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s) and/or related mezzanine loan(s).

(2)In the case of Loan No. 3, the UW NCF DSCR and UW NOI DY are calculated based on the master lease annual rent of $292,000,000.

(3)In the case of Loan Nos. 1, 3, 6 and 7, the Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details.

(4)In the case of Loan No. 3, with an anticipated repayment date, Maturity Date LTV is calculated as of the related anticipated repayment date.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20

 

Collateral Characteristics
 
Companion Loan Summary

 

       Lead Servicer forMaster ServicerSpecial Servicer
Loan   OriginalCut-off Date Whole LoanUnder LeadUnder Lead
No.Mortgage LoanNote(s)Balance ($)Balance ($)Holder of Note(Y/N)SecuritizationSecuritization
1Moffett Place -A-1-S, A-2-S $500,000$500,000MOFT 2020-B6No  
 Building 6        
  A-1-C1, A-1-C2, A-1-C3, A-1-C4, A-1-      
  C6$74,850,000$74,850,000BMARK 2020-B20No  
         
  A-1-C5-1, A-2-C$57,750,000$57,750,000BMARK 2020-B19No  
  B-1, B-2(1) $66,900,000$66,900,000MOFT 2020-B6Yes(2)KeyBankKeyBank
  Total $200,000,000$200,000,000    
2120 Wall StreetA-1, A-2, A-3 $95,000,000$95,000,000WFBYes(3)(3)
  A-4, A-5, A-6, A-7$70,000,000$70,000,000BMARK 2020-B20No(3)  
  Total $165,000,000$165,000,000    
 MGM Grand &        
3Mandalay BayA-1, A-2, A-3, A-4$670,139$670,139BX 2020-VIVANo  
         
  A-5, A-6, A-7, A-8$794,861$794,861BX 2020-VIV2No  
  A-9, A-10, A-11, A-12$1,000,000$1,000,000BX 2020-VIV3No  
  A-13-1, A-15-1$65,000,000$65,000,000BMARK 2020-B18No  
  A-14-1, A-16-1$69,500,000$69,500,000BBCMS 2020-C8No  
  A-13-2, A-15-3$80,000,000$80,000,000BMARK 2020-B19No  
  A-15-2 $50,000,000$50,000,000DBJPM 2020-C9No  
  A-16-2, A-16-3$301,347,000$301,347,000SocGenNo  
  A-13-4, A-15-4$70,000,000$70,000,000BMARK 2020-B20No  
  A-14-3, A-14-4$241,847,000$241,847,000BarclaysNo  
  A-13-3, A-13-5$509,360,667$509,360,667CREFINo  
  A-15-5, A-15-6$204,680,333$204,680,333DBRINo  
  B-1-A, B-2-A, B-3-A, B-4-A, B-1-B, B-2-B, B-3-B, B-4-B(1)$329,861$329,861BX 2020-VIVANo  
  B-5-A, B-6-A, B-7-A, B-8-A, B-5-B, B-6-B, B-7-B, B-8-B(1)$374,355,139$374,355,139BX 2020-VIV2No  
  B-9-A, B-10-A, B-11-A, B-12-A(1)$429,715,000$429,715,000BX 2020-VIV3No  
  C-1, C-2, C-3, C-4(1)$561,400,000$561,400,000BX 2020-VIVAYes(4)KeyBankSitus
  Total $3,000,000,000$3,000,000,000    
44 West 58th StreetA-1 $62,500,000$62,500,000BMARK 2020-B20YesMidlandMidland
  A-2, A-3 $62,500,000$62,500,000JPMCBNo  
  Total $125,000,000$125,000,000    
6Coleman HighlineA-1, A-3, A-5 $85,000,000$85,000,000BMARK 2020-B19YesMidlandRialto
  A-2 $30,000,000$30,000,000DBJPM 2020-C9No  
  A-4, A-6 $40,000,000$40,000,000BMARK 2020-B20No  
  Total $155,000,000$155,000,000    

(1)Each note represents a subordinate companion loan.

(2)In the case of Loan No. 1, the controlling note as of the date hereof is a related subordinate note. Upon the occurrence of certain trigger events specified in the related co-lender agreement, however, control will generally shift to a more senior note in the subject whole loan, which more senior note will thereafter be the controlling note. The more senior note may be included in another securitization trust, in which case the directing party for the related whole loan will be the party designated under the servicing agreement for such securitization trust. See “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced AB Whole Loans—The Moffett Place – Building 6 Whole Loan” in the Preliminary Prospectus.

(3)In the case of Loan No. 2, the whole loan is expected to be serviced under the Benchmark 2020-B20 pooling and servicing agreement until such time as the controlling note has been securitized, at which point the whole loan will be serviced under the pooling and servicing agreement related to such securitization.

(4)In the case of Loan No. 3, the initial controlling note is Note C-1, so long as no related control appraisal period with respect to Note C-1 and the related pari passu C notes has occurred and is continuing. If and for so long as a control appraisal period has occurred and is continuing, then the controlling note will be as described under “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced AB Whole Loans—The MGM Grand & Mandalay Bay Pari Passu-AB Whole Loan” in the Preliminary Prospectus.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20

 

Collateral Characteristics

 

      LeadMasterSpecial
      Servicer forServicerServicer Under
Loan  OriginalCut-off Date Whole LoanUnder LeadLead
No.Mortgage LoanNote(s)Balance ($)Balance ($)Holder of Note(Y/N)SecuritizationSecuritization
9Agellan PortfolioA-1$75,000,000$75,000,000BMARK 2020-B18No  
  A-2, A-6$61,000,000$61,000,000DBJPM 2020-C9No  
  A-3, A-4$60,000,000$60,000,000BMARK 2020-B19No  
  A-5, A-7$35,000,000$35,000,000BMARK 2020-B20No  
  B Note(1)$172,000,000$172,000,000BMARK 2020-B18Yes(2)MidlandMidland
  Total$403,000,000$403,000,000    
11333 South WabashA-1 (AGL, AGL-Fortitude)$91,000,000$91,000,000AGL   
  A-1 (VALIC)$35,000,000$35,000,000VALIC   
  A-2-A$30,000,000$30,000,000BMARK 2020-B20   
  A-2-B$50,000,000$50,000,000BMARK 2020-B19Yes(3)MidlandRialto
  A-2-C$20,000,000$20,000,000DBJPM 2020-C9   
  A-1 (AHAC, AHAC-$11,200,000$11,200,000AHAC   
  Fortitude)      
  A-1 (NUFI-Fortitude)$2,800,000$2,800,000NUFI   
  Total$240,000,000$240,000,000    
 Redmond Town       
12CenterA-1-1, A-2$30,000,000$30,000,000BMARK 2020-B19YesMidlandRialto
  A-1-2-A, A-1-2-B, A-3-2$41,500,000$41,500,000CREFINo  
  A-3-1, A-4$30,000,000$30,000,000BMARK 2020-B20No  
  Total$101,500,000$101,500,000    
16USAA PlanoA-1$38,600,000$38,600,000BMARK 2020-B19YesMidlandRialto
  A-2$25,000,000$25,000,000BMARK 2020-B20No  
  Total$63,600,000$63,600,000    
17The HubA-1$25,000,000$25,000,000BMARK 2020-B20YesMidlandMidland
  A-219,205,88119,205,881GSBINo  
  Total$44,205,881$44,205,881    
18Troy Technology ParkA-1$25,000,000$25,000,000BMARK 2020-B20YesMidlandMidland
  A-2$20,000,000$20,000,000JPMCBNo  
   $45,000,000$45,000,000    
  Total      
19Amazon Industrial PortfolioA-1$80,000,000$80,000,000BMARK 2020-B19YesMidlandRialto
  A-2$35,000,000$35,000,000DBJPM 2020-C9No  
  A-3$24,100,000$24,100,000BMARK 2020-B20No  
  Total$139,100,000$139,100,000    
23711 Fifth AvenueA-1-1, A-1-10$62,500,000$62,500,000GSMS 2020-GC47YesWells FargoKeyBank
  A-1-2, A-1-3, A-1-4, A-1-5-$184,000,000$184,000,000GSBINo  
  A, A-1-5-C, A-1-16, A-1-17      
  A-1-5-B$15,000,000$15,000,000BMARK 2020-B20No  
  A-1-6, A-1-7$40,000,000$40,000,000JPMDB 2020-COR7No  
  A-1-8, A-1-13, A-1-9$45,000,000$45,000,000BMARK 2020-B18No  
  A-1-11, A-1-12, A-1-14$25,000,000$25,000,000DBJPM 2020-C9No  
  A-1-15$10,000,000$10,000,000BMARK 2020-B19No  
  A-2-1$60,000,000$60,000,000BANK 2020-BNK28No  
  A-2-2$43,000,000$43,000,000BANK 2020-BNK27No  
  A-2-3, A-2-4$60,500,000$60,500,000BANANo  
  Total$545,000,000$545,000,000    

(1)Each note represents a subordinate companion loan.

(2)In the case of Loan No. 9, the initial controlling note is Note B, for so long as no control appraisal period with respect to Note B is continuing. See “Description of the Mortgage Pool—The Whole Loans The Non-Serviced AB Whole Loans—The Agellan Portfolio Whole Loan” in the Preliminary Prospectus. The Agellan Portfolio Whole Loan will be serviced under the pooling and servicing agreement for the Benchmark 2020-B18 transaction.

(3)In the case of Loan No. 11, The controlling note is A-2-B; however, so long as AGL, VALIC, AHAC and NUFI (collectively, the “Life Company Lenders”) hold at least $75,000,000 in outstanding principal balance of the 333 South Wabash whole loan, Asset Management (U.S.), LLC (“AIG”) is irrevocably appointed as the controlling note holder representative with the ability to exercise all rights of the Controlling Note holder. Accordingly, for purposes of discussing the rights of the directing holder and related matters in this Term Sheet, the notes evidencing the portion of the 333 South Wabash whole loan held by the Life Company Lenders will be deemed to collectively constitute the related Controlling Note.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 6 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20

 

Collateral Characteristics
 
Additional Debt Summary

 

No.

Loan Name 

Trust Cut-off Date Balance 

Subordinate Debt Cut-off Date Balance(1) 

Total Debt Cut-off Date Balance 

Mortgage Loan UW NCF DSCR(2)(3) 

Total Debt UW NCF DSCR(3) 

Mortgage Loan Cut-off Date LTV(2)(4)Total Debt Cut-off Date LTV(4)

Mortgage Loan UW NOI DY(2)(3) 

Total Debt UW NOI DY(3) 

1Moffett Place - Building 6$74,850,000$115,900,000$249,000,0003.50x1.59x37.1%69.3%12.2%6.5%
3MGM Grand & Mandalay Bay$70,000,000$1,365,800,000   $3,000,000,000   4.95x2.70x35.5%65.2%17.9%9.7%
9Agellan Portfolio$35,000,000$203,000,000$434,000,0003.03x1.54x41.9%78.8%15.7%8.3%
17The Hub$25,000,000    $2,560,000   $46,765,8813.04x2.76x54.7%57.9%11.1%10.5%
(1)In the case of Loan Nos. 3 and 17, Subordinate Debt Cut-off Date Balance represents one or more Subordinate Companion Loans. In the case of Loan Nos. 1 and 9, Subordinate Debt Cut-off Date Balance represents one or more Subordinate Companion Loans and one or more mezzanine loans.

(2)In the case of Loan Nos. 1, 3, 9 and 17, the Mortgage Loan UW NCF DSCR, Mortgage Loan UW NOI DY and Mortgage Loan Cut-off Date LTV calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 3, 9 and 17, the Mortgage Loan UW NCF DSCR, Mortgage Loan UW NOI DY and Mortgage Loan Cut-off Date LTV calculations exclude the related Subordinate Companion Loan(s) and/or related mezzanine loan(s).

(3)In the case of Loan No. 3, the Mortgage Loan UW NCF DSCR, Total Debt UW NCF DSCR, Mortgage Loan UW NOI DY and Total Debt UW NOI DY are calculated based on the master lease annual rent of $292,000,000.

(4)In the case of Loan Nos. 1 and 3, the Mortgage Loan Cut-off Date LTV and Total Debt Cut-Off Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 7 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20

 

Collateral Characteristics
 
Mortgaged Properties by Type(1)

 

     Weighted Average
   Cut-off Date  UWUWCut-offMaturity
  Number ofPrincipal% of NCFNOIDateDate LTV
Property TypeProperty SubtypePropertiesBalanceIPBOccupancyDSCR(2)(3)DY(2)(3)LTV(2)(3)(4)(2)(3)(4)(5)
OfficeCBD9$279,342,80430.9%95.7%2.86x10.4%53.8%53.8%
 Suburban9173,980,64519.395.6%2.78x11.0%57.9%54.1%
 Medical19,500,0001.1100.0%2.36x9.3%60.1%60.1%
 Subtotal:19$462,823,44951.2%95.7%2.82x10.6%55.5%54.0%
          
Mixed UseOffice/Retail2$77,500,0008.6%95.5%2.13x7.8%66.5%66.5%
 Retail/Office255,000,0006.196.1%2.36x10.9%61.5%59.5%
 Industrial/Office125,000,0002.885.8%1.66x9.2%72.9%60.9%
 Medical/Retail120,400,0002.383.6%2.06x9.1%58.2%58.2%
 Multifamily/Retail15,700,0000.6100.0%2.08x8.6%48.7%48.7%
 Multifamily/Office12,300,0000.3100.0%1.90x8.0%50.0%50.0%
 Subtotal:8$185,900,00020.6%93.2%2.12x9.1%64.2%62.0%
          
IndustrialFlex/R&D3$64,130,2507.1%98.3%1.77x11.0%56.0%42.3%
 Warehouse/Distribution2038,437,8414.398.2%2.62x10.9%56.2%56.2%
 Flex2313,120,2231.589.9%3.03x15.7%41.9%41.9%
 Manufacturing16,186,1260.7100.0%2.11x11.3%59.5%48.9%
 Warehouse1168,4860.0100.0%3.03x15.7%41.9%41.9%
 Subtotal:48$122,042,92713.5%97.4%2.19x11.5%54.7%47.0%
          
HotelFull Service2$70,000,0007.7%87.5%4.95x17.9%35.5%35.5%
 Subtotal:2$70,000,0007.7%87.5%4.95x17.9%35.5%35.5%
          
Self StorageSelf Storage8$36,722,5004.1%85.4%2.00x9.3%62.4%55.3%
 Subtotal:8$36,722,5004.1%85.4%2.00x9.3%62.4%55.3%
          
RetailAnchored1$7,800,0000.9%98.9%1.81x11.5%65.0%59.0%
 Other17,250,0000.8100.0%2.97x10.7%54.1%54.1%
 Subtotal:2$15,050,0001.7%99.4%2.37x11.1%59.7%56.6%
          
MultifamilyMid-Rise1$5,800,0000.6%100.0%1.85x7.5%63.7%63.7%
 Garden15,150,0000.6100.0%2.48x9.8%55.1%55.1%
 Subtotal:2$10,950,0001.2%100.0%2.15x8.6%59.7%59.7%
          
 Total / Weighted Average:89$903,488,876 100.0%94.5%2.71x10.9%56.0%53.5%

(1)Because this table presents information relating to the mortgaged properties and not mortgage loans, the information for mortgage loans secured by more than one mortgaged property is based on allocated loan amounts.

(2)In the case of Loan Nos. 1, 2, 3, 4, 6, 9, 11, 12, 16, 17, 18, 19 and 23, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV Ratio calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 3, 9 and 17, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s) and/or related mezzanine loan(s).

(3)In the case of Loan No. 21, the UW NOI DY, Cut-off Date LTV and Maturity Date LTV are calculated net of a holdback reserve. In the case of Loan No. 3, the UW NCF DSCR and UW NOI DY are calculated based on the master lease annual rent of $292,000,000.

(4)In the case of Loan Nos. 1, 3, 6, 7, 16, 18, and 20, the Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details.

(5)In the case of Loan Nos. 3 and 16, with an anticipated repayment date, Maturity Date LTV is calculated as of the related anticipated repayment date.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 8 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20

 

Collateral Characteristics
 
Mortgaged Properties by Location(1)

 

State

Number of Properties 

Cut-off Date
Principal
Balance

% of IPB 

Weighted Average

Occupancy 

UW 

NCF DSCR(2)(3) 

UW NOI DY(2)(3) 

Cut-off Date
LTV(2)(3)(4)
 

Maturity Date
LTV (2)(3)(4)(5)
 

California10$241,580,25026.7%94.0%3.00x10.9%51.7%50.0%
New York7186,300,00020.696.3%2.47x  8.8%60.9%60.9%
Texas2495,050,99310.597.9%2.50x11.5%56.4%53.5%
Nevada270,000,0007.787.5%4.95x17.9%35.5%35.5%
Michigan356,194,1696.291.2%1.79x10.2%66.7%58.0%
Minnesota249,300,0005.597.8%1.83x11.6%53.3%39.8%
Illinois1143,553,4744.892.2%2.83x11.0%58.3%58.3%
Arizona140,400,0004.5100.0%2.58x  9.4%62.6%62.6%
Washington340,290,0004.592.2%1.83x10.3%65.7%61.2%
Florida216,551,1361.8100.0%2.55x10.1%58.6%58.6%
Kansas111,959,9071.3100.0%2.38x  8.0%64.7%64.7%
Idaho311,887,5001.384.6%1.41x   8.6%67.5%54.2%
Alabama17,800,0000.998.9%1.81x11.5%65.0%59.0%
Louisiana17,080,0000.891.7%2.87x10.2%58.8%58.8%
Wisconsin16,186,1260.7100.0%2.11x11.3%59.5%48.9%
New Jersey15,200,0000.686.6%2.55x10.1%54.9%54.9%
Pennsylvania14,800,0000.585.7%2.55x10.1%54.9%54.9%
Georgia93,944,6650.495.2%3.03x15.7%41.9%41.9%
Oregon12,615,0000.378.9%1.41x8.6%67.5%54.2%
Indiana11,534,6150.2100.0%3.03x15.7%41.9%41.9%
Ohio2582,7540.155.2%3.03x15.7%41.9%41.9%
Maryland1464,6400.192.2%3.03x15.7%41.9%41.9%
Kentucky1213,6480.0100.0%3.03x15.7%41.9%41.9%
Total / Weighted Average:89$903,488,876100.0%94.5%2.71x10.9%56.0%53.5%
(1)Because this table presents information relating to the mortgaged properties and not mortgage loans, the information for mortgage loans secured by more than one mortgaged property is based on allocated loan amounts.

(2)In the case of Loan Nos. 1, 2, 3, 4, 6, 9, 11, 12, 16, 17, 18, 19 and 23, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV Ratio calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 3, 9 and 17, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s) and/or related mezzanine loan(s).

(3)In the case of Loan No. 21, the UW NOI DY, Cut-off Date LTV and Maturity Date LTV are calculated net of a holdback reserve. In the case of Loan No. 3, the UW NCF DSCR and UW NOI DY are calculated based on the master lease annual rent of $292,000,000.

(4)In the case of Loan Nos. 1, 3, 6, 7, 16, 18, and 20, the Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details.

(5)In the case of Loan Nos. 3 and 16, with an anticipated repayment date, Maturity Date LTV is calculated as of the related anticipated repayment date.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 9 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20

 

Collateral Characteristics
 
Cut-off Date Principal Balance

 

Range of Cut-off Date Principal Balances

Number of
Loans

Cut-off Date
Principal
Balance

% of IPB

Weighted Average

Mortgage
Rate

Remaining
Loan
Term(1)

UW
NCF

DSCR(2)(3)

UW
NOI
DY(2)(3)
Cut-off
Date
LTV(2)(3)(4)
Maturity
Date
LTV(1)(2)(3)(4)
$2,300,000 -$9,999,9999$56,766,1266.3%3.71571%1102.31x9.8%58.1%56.2%
$10,000,000   -$19,999,999454,942,5006.13.83999%1182.12x9.7%61.7%55.2%
$20,000,000   -$24,999,999366,100,0007.33.55261%1112.22x9.7%63.2%59.0%
$25,000,000   -$49,999,99914448,330,25049.6    3.59549%1032.52x10.8%58.2%54.7%
$50,000,000   -$74,850,0004277,350,00030.7   3.44446%1163.32x11.8%49.2%49.2%
Total / Wtd. Avg:34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%

 

Mortgage Interest Rates

 

Range of Mortgage Interest Rates

Number of Loans

Cut-off Date
Principal
Balance

% of IPB

Weighted Average

Mortgage
Rate

Remaining
Loan
Term(1)

UW
NCF

DSCR(2)(3) 

UW
NOI
DY(2)(3)
Cut-off
Date
LTV(2)(3)(4)
Maturity
Date
LTV(1)(2)(3)(4)
2.80000% -3.00000%1$40,000,0004.4%2.80000%1193.64x10.3%50.8%50.8%
3.00001% -3.50000%10307,966,12634.13.29246%1182.88x10.7%52.0%50.0%
3.50001% -4.00000%17450,480,25049.93.65316%1082.61x10.9%59.4%56.4%
4.00001% -4.50000%570,042,5007.84.14594%971.91x9.5%61.9%56.9%
4.50001% -4.62820%135,000,0003.94.62820%583.03x15.7%41.9%41.9%
Total / Wtd. Avg:34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%

 

Original Term to Maturity in Months

 

Original Term to Maturity in Months

Number of Loans

Cut-off Date
Principal
Balance

% of IPB

Weighted Average

Mortgage
Rate

Remaining
Loan
Term(1)

UW
NCF

DSCR(2)(3)

UW
NOI
DY(2)(3)
Cut-off
Date
LTV(2)(3)(4)
Maturity
Date
LTV(1)(2)(3)(4)
604$73,000,0008.1%4.24284%562.41x12.8%53.1%51.6%
84272,500,0008.03.81237%842.40x9.4%61.4%61.4%
96130,000,0003.33.53000%952.75x10.1%62.8%62.8%
107124,100,0002.73.25000%1052.38x8.0%64.7%64.7%
110121,600,0002.43.71800%1102.19x12.3%66.3%53.5%
12025682,288,87675.53.47853%1182.80x11.0%54.8%52.0%
Total / Wtd. Avg:34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%

 

Remaining Term to Maturity in Months(1)

 

 Weighted Average

Range of Remaining Term to Maturity in Months

Number of
Loans
 

Cut-off Date
Principal
Balance

% of IPB

Mortgage Rate 

Remaining
Loan
Term(1)

UW
NCF
 

DSCR(2)(3) 

UW
NOI
DY(2)(3)
Cut-off
Date
LTV(2)(3)(4)
Maturity
Date
LTV(1)(2)(3)(4)
53 -604$73,000,0008.1%4.24284%562.41x12.8%53.1%51.6%
61 -84272,500,0008.03.81237%842.40x9.4%61.4%61.4%
85 -11910370,850,00041.03.44319%1133.21x11.6%51.7%50.8%
120 -12018387,138,87642.83.51551%1202.34x10.2%59.7%54.9%
Total / Wtd. Avg: 34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%
(1)In the case of Loan Nos. 3 and 16, with an anticipated repayment date, Remaining Loan Term and Maturity Date LTV is calculated as of the related anticipated repayment date.

(2)In the case of Loan Nos. 1, 2, 3, 4, 6, 9, 11, 12, 16, 17, 18, 19 and 23, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 3, 9 and 17, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s) and/or related mezzanine loan(s).

(3)In the case of Loan No. 21, the UW NOI DY, Cut-off Date LTV and Maturity Date LTV are calculated net of a holdback reserve. In the case of loan No. 3, the UW NCF DSCR, UW NOI DY are calculated based on the master lease annual rent of $292,000,000.

(4)In the case of Loan Nos. 1, 3, 6, 7, 16, 18 and 20, the Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 10 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20

 

Collateral Characteristics
 
Original Amortization Term in Months

 

 Weighted Average

Original Amortization Term in Months

Number
of Loans
 

Cut-off Date
Principal
Balance
 

% of IPB 

Mortgage
Rate
 

Remaining
Loan
Term(1)
 

UW 

NCF  

DSCR(2)(3)

UW
NOI
DY(2)(3)
 

Cut-off
Date
LTV(2)(3)(4)
 

Maturity
Date
LTV(1)(2)(3)(4)
 

Interest Only24$685,630,00075.9%3.52361%1093.00x11.0%53.7%53.7%
300-300139,000,0004.3   3.44000%1201.80x11.5%49.5%34.8%
360-3609178,858,87619.8  3.76816%1071.77x10.3%66.4%56.7%
Total / Wtd. Avg: 34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%

 

Remaining Amortization Term in Months

 

 Weighted Average

Range of Remaining Amortization Term in Months

Number
of Loans
 

Cut-off Date
Principal
Balance
 

% of IPB 

Mortgage
Rate
 

Remaining
Loan
Term(1)
 

UW

NCF

DSCR(2)(3)

UW
NOI
DY(2)(3)
 

Cut-off
Date
LTV(2)(3)(4)
 

Maturity
Date
LTV(1)(2)(3)(4)
 

Interest Only24$685,630,00075.9%3.52361%1093.00x11.0%53.7%53.7%
300-300139,000,0004.3   3.44000%1201.80x11.5%49.5%34.8%
360-3609178,858,87619.8  3.76816%1071.77x10.3%66.4%56.7%
Total / Wtd. Avg: 34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%

 

Amortization Types

 

Amortization Types 

Number
of Loans
 

Cut-off Date
Principal
Balance
 

% of IPB 

Weighted Average

Mortgage
Rate
 

Remaining
Loan
Term(1)

UW
NCF
 

DSCR(2)(3) 

UW
NOI
DY(2)(3)
Cut-off
Date
LTV(2)(3)(4)
Maturity
Date
LTV(1)(2)(3)(4)
Interest Only22$590,630,00065.4%3.51528%1082.78x10.2%55.8%55.8%
IO-Balloon6109,286,12612.13.72708%1011.81x10.6%66.6%59.3%
Balloon4108,572,75012.03.69163%1181.75x10.5%60.1%46.2%
ARD-Interest Only295,000,00010.53.57537%1154.39x16.0%40.1%40.1%
Total / Wtd. Avg:34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%

 

Underwritten Net Cash Flow Debt Service Coverage Ratios(2)(3)

 

 Weighted Average

Range of Underwritten Net Cash Flow Debt Service Coverage Ratios 

Number of Loans 

Cut-off Date
Principal
Balance
 

% of IPB

Mortgage
Rate
 

Remaining
Loan
Term(1)
 

UW
NCF
 

DSCR(2)(3) 

UW
NOI
DY(2)(3)
 

Cut-off
Date
LTV(2)(3)(4)
 

Maturity
Date
LTV(1)(2)(3)(4)
 

1.41x -1.49x1$19,642,5002.2%4.28000%1201.41x8.6%67.5%54.2%
1.50x -1.74x253,330,2505.93.64750%1201.61x9.1%68.7%55.6%
1.75x -1.99x8187,700,00020.83.68445%1061.86x9.8%63.1%57.7%
2.00x -2.24x585,986,1269.53.85904%1002.14x10.2%60.3%56.4%
2.25x -4.95x18556,830,00061.63.45174%1103.23x11.7%51.3%51.3%
Total / Wtd. Avg: 34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%
(1)In the case of Loan Nos. 3 and 16, with an anticipated repayment date, Remaining Loan Term and Maturity Date LTV is calculated as of the related anticipated repayment date.

(2)In the case of Loan Nos. 1, 2, 3, 4, 6, 9, 11, 12, 16, 17, 18, 19 and 23, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 3, 9 and 17, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s) and/or related mezzanine loan(s).

(3)In the case of Loan No. 21, the UW NOI DY, Cut-off Date LTV and Maturity Date LTV are calculated net of a holdback reserve. In the case of loan No. 3, the UW NCF DSCR, UW NOI DY are calculated based on the master lease annual rent of $292,000,000.

(4)In the case of Loan Nos. 1, 3, 6, 7, 16, 18 and 20, the Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 11 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20

 

Collateral Characteristics
 
LTV Ratios as of the Cut-off Date(2)(3)(4)

 

 Weighted Average

Range of 

Cut-off Date LTVs 

Number of Loans 

Cut-off Date
Principal Balance

% of IPB

Mortgage
Rate
 

Remaining
Loan
Term(1)

UW
NCF
 

DSCR(2)(3) 

UW
NOI
DY(2)(3)
Cut-off
Date
LTV(2)(3)(4)
Maturity
Date
LTV(1)(2)(3)(4)
35.5% -39.9%2$144,850,00016.0%3.46048%1164.20x15.0%36.3%36.3%
40.0% -49.9%379,700,0008.84.00399%882.36x13.1%46.1%38.9%
50.0% -59.9%15333,966,12637.03.39208%1162.83x10.2%56.6%56.4%
60.0% -69.9%13319,972,75035.43.68332%1032.07x9.4%65.5%61.2%
70.0% -72.9%125,000,0002.83.69000%1201.66x9.2%72.9%60.9%
Total / Wtd. Avg: 34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%

 

LTV Ratios as of the Maturity Date(1)(2)(3)(4)

 

Range of Maturity Date LTVs 

Number of Loans 

Cut-off Date
Principal Balance
 

% of IPB 

Weighted Average

Mortgage
Rate
 

Remaining
Loan
Term(1)

UW
NCF
 

DSCR(2)(3) 

UW
NOI
DY(2)(3)
Cut-off
Date
LTV(2)(3)(4)
Maturity
Date
LTV(1)(2)(3)(4)
34.8% -39.9%3$183,850,00020.3%3.45614%1173.69x14.2%39.1%36.0%
40.0% -44.9%135,000,0003.94.62820%583.03x15.7%41.9%41.9%
45.0% -49.9%211,886,1261.33.59647%912.10x10.0%54.3%48.8%
50.0% -54.9%10194,122,75021.53.48373%1172.61x10.2%57.7%52.9%
55.0% -69.4%18478,630,00053.03.56769%1072.36x9.6%62.9%61.4%
Total / Wtd. Avg: 34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%

 

Prepayment Protection

 

Prepayment Protection 

Number of Loans 

Cut-off Date
Principal Balance
 

% of IPB 

Weighted Average

Mortgage
Rate
 

Remaining
Loan
Term(1)

UW
NCF
 

DSCR(2)(3) 

UW
NOI
DY(2)(3)
Cut-off
Date
LTV(2)(3)(4)
Maturity
Date
LTV(1)(2)(3)(4)
Defeasance25$565,252,75062.6%3.59919%1062.38x10.2%60.1%56.6%
Defeasance or Yield Maintenance4221,036,12624.53.37093%1173.68x13.1%43.8%43.5%
Yield Maintenance5117,200,00013.03.79242%1082.47x10.5%59.6%57.2%
Total / Wtd. Avg:34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%

 

Loan Purpose

 

Loan Purpose 

Number of
Loans
 

Cut-off Date
Principal Balance
 

% of IPB 

Weighted Average

Mortgage
Rate
 

Remaining
Loan
Term(1)

UW
NCF
 

DSCR(2)(3) 

UW
NOI
DY(2)(3)
Cut-off
Date
LTV(2)(3)(4)
Maturity
Date
LTV(1)(2)(3)(4)
Refinance22$527,658,62658.4%3.53664%1092.78x10.7%54.5%53.4%
Acquisition8222,730,25024.73.58243%1133.09x12.2%54.6%51.0%
Recapitalization4153,100,00016.93.65754%1031.91x9.8%63.5%57.2%
Total / Wtd. Avg:34$903,488,876100.0%3.56841%1092.71x10.9%56.0%53.5%
(1)In the case of Loan Nos. 3 and 16, with an anticipated repayment date, Remaining Loan Term and Maturity Date LTV is calculated as of the related anticipated repayment date.

(2)In the case of Loan Nos. 1, 2, 3, 4, 6, 9, 11, 12, 16, 17, 18, 19 and 23, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 3, 9 and 17, the UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s) and/or related mezzanine loan(s).

(3)In the case of Loan No. 21, the UW NOI DY, Cut-off Date LTV and Maturity Date LTV are calculated net of a holdback reserve. In the case of loan No. 3, the UW NCF DSCR, UW NOI DY are calculated based on the master lease annual rent of $292,000,000.

(4)In the case of Loan Nos. 1, 3, 6, 7, 16, 18 and 20, the Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 12 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20

 

Collateral Characteristics

 

Previous Securitization History(1)

 

No. 

Mortgaged Property 

Cut-off Date Principal Balance

% of IPB 

Location 

Property Type 

Previous Securitization 

2120 Wall Street$70,000,0007.7%New York, NYOfficeMSBAM 2014-C14
7Point West Portfolio$39,500,0004.4%Sacramento, CAOfficePFP 2017-4
9Agellan Portfolio$35,000,0003.9%Various, VariousVariousMSC 2019-AGLN
142665 North First$29,000,0003.2%San Jose, CAOfficePFP 2015-2
25.01Storage at Atlas(2)$5,200,0000.6%Ocean Township, NJSelf StorageCGCMT 2016-P3
25.02Storage at Mont Mini(2)$4,800,0000.5%Montgomeryville, PASelf StorageGSMS 2015-GC34
29Storage Post – Jefferson, LA$7,080,0000.8%Jefferson, LASelf StorageUBSCM 2012-C1
(1)The table above represents the properties for which the previously existing debt was securitized, based on information provided by the related borrower or obtained through searches of a third-party database.

(2)Cut-off Date Principal Balance represents the allocated loan amount for each respective mortgaged property.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 13 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
Moffett Place - Building 6

 

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 14 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
Moffett Place - Building 6

 

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 15 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
Moffett Place - Building 6

 

Mortgage Loan Information Property Information
Mortgage Loan Seller:GACC Single Asset / Portfolio:Single Asset
Original Principal Balance(1):$74,850,000 Title:Fee
Cut-off Date Principal Balance(1):$74,850,000 Property Type - Subtype:Office – CBD
% of Pool by IPB:8.3% Net Rentable Area (SF):314,352
Loan Purpose:Refinance Location:Sunnyvale, CA
Borrower:MP B6 LLC Year Built / Renovated:2020 / N/A
Loan Sponsor:Jay Paul Occupancy:100.0%
Interest Rate:3.369279% Occupancy Date:10/6/2020
Note Date:8/6/2020 Number of Tenants:1
Maturity Date:8/6/2030 2017 NOI:N/A
Interest-only Period:120 months 2018 NOI:N/A
Original Term:120 months 2019 NOI:N/A
Original Amortization:None TTM NOI:N/A
Amortization Type:Interest Only UW Economic Occupancy:95.0%
Call Protection:L(24),Grtr1%orYM(2), UW Revenues:$18,990,159
 DeforGrtr1%orYM(87),O(7) UW Expenses:$2,692,414
Lockbox / Cash Management:Hard / In Place UW NOI(5):$16,297,746
Additional Debt:Yes UW NCF(5):$15,910,023
Additional Debt Balance:$58,250,000 / $66,900,000 / Appraised Value / Per SF(2)(5):$359,200,000 / $1,143
 $49,000,000 Appraisal Date:5/1/2021
Additional Debt Type:Pari Passu / Subordinate /   
 Mezzanine   
     

 

Escrows and Reserves(3) Financial Information(5)
InitialMonthlyInitial Cap  Senior NotesWhole Loan/Total Debt
Taxes:$0$85,000N/A Cut-off Date Loan / SF:$423$636 / $792
Insurance:$0SpringingN/A Maturity Date Loan / SF:$423$636 / $792
Replacement Reserves:$0SpringingN/A Cut-off Date LTV(2):37.1%55.7% / 69.3%
TI/LC:$2,728,059$0N/A Maturity Date LTV(2):37.1%55.7% / 69.3%
Other(4):$14,559,592SpringingN/A UW NCF DSCR:3.50x2.33x / 1.59x
     UW NOI Debt Yield:12.2%8.1% / 6.5%
   

 

Sources and Uses
SourcesProceeds% of Total UsesProceeds% of Total
Senior Notes$133,100,00053.5% Payoff Existing Debt$164,454,17266.0%
Junior Notes66,900,00026.9   Return of Equity57,161,74623.0  
Mezzanine Loan49,000,00019.7   Upfront Reserves17,287,6526.9
    Closing Costs10,096,4304.1
Total Sources$249,000,000100.0% Total Uses$249,000,000100.0%
(1)The Cut-off Date Balance of $74,850,000 represents the non-controlling Note A-1-C1, Note A-1-C2, Note A-1-C3, Note A-1-C4, and Note A-1-C6, and is part of the Moffett Place - Building 6 Whole Loan (as defined below), which is evidenced by nine pari passu senior notes and two junior notes, and has an aggregate outstanding principal balance as of the Cut-off Date of $200,000,000. For additional information, see “The Loan” herein.

(2)The appraised value represents the “Prospective Market Value Upon Stabilization” as of May 1, 2021. The appraiser also concluded an “As-Is” appraised value of $333,000,000 as of August 1, 2020, which results in a Cut-off Date LTV and Maturity Date LTV of 40.0% for the Moffett Place - Building 6 Senior Notes (as defined below), 60.1% for the Moffett Place - Building 6 Whole Loan (as defined below) and 74.8% for the Moffett Place - Building 6 Total Debt (as defined below).

(3)For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below. In addition, the appraisal concluded to a “Hypothetical As If Vacant” appraised value (“Go Dark” Value) equal to $289,100,000 as of August 1, 2020. Based on the “Hypothetical Go Dark” appraised value, the Cut-off Date LTV and Maturity Date LTV are 46.0 % for the Moffett Place - Building 6 Senior Notes, 69.2% for the Moffett Place - Building 6 Whole Loan and 86.1% for the Moffett Place - Building 6 Total Debt.

(4)The Other reserve is comprised of a $2,496,716 debt service reserve, a $12,062,876 free rent reserve and a springing lease sweep reserve. The lease sweep reserve is subject to the Lease Sweep Reserve Cap (as defined below).

(5)While the Moffett Place – Building 6 Whole Loan was originated after the emergence of the novel coronavirus pandemic and the economic disruption resulting from measures to combat the pandemic, the pandemic is an evolving situation and could impact the Moffett Place – Building 6 Whole Loan more severely than assumed in the

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 16 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
Moffett Place - Building 6

 

underwriting of the Moffett Place – Building 6 Whole Loan and could adversely affect the NOI, NCF and occupancy information, as well as the appraised value and the DSCR, LTV and Debt Yield metrics presented above. See “Risk Factors— Risks Related to Market Conditions and Other External Factors—Coronavirus Pandemic Has Adversely Affected the Global Economy and Will Likely Adversely Affect the Performance of the Mortgage Loans” in the Preliminary Prospectus.

 

The Loan. The Moffett Place - Building 6 mortgage loan (the Moffett Place - Building 6 Loan”) is part of a whole loan with an aggregate outstanding principal balance as of the Cut-off Date of $200.0 million (the Moffett Place - Building 6 Whole Loan”), evidenced by nine pari passu senior notes with an aggregate initial principal balance of $133,100,000 (collectively the Moffett Place - Building 6 Senior Notes”) and two junior notes with an aggregate initial principal balance of $66,900,000 (collectively the Moffett Place - Building 6 Junior Notes”). The loan is secured by the borrower’s fee interest in a 314,352 square foot, newly constructed Class A office building located in Sunnyvale, California. The non-controlling Note A-1-C1, Note A-1-C2, Note A-1-C3, Note A-1-C4, and Note A-1-C6, with an outstanding principal balance as of the Cut-off Date of $74.85 million, will be included in the Benchmark 2020-B20 trust. The remaining notes have been contributed to one or more securitization trusts. The relationship between the holders of the Moffett Place - Building 6 Whole Loan is governed by a co-lender agreement as described under “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced Pari Passu Whole Loans” in the Preliminary Prospectus. The Moffett Place – Building 6 Whole Loan will be serviced under the trust and servicing agreement for the MOFT 2020-B6 transaction. The Moffett Place - Building 6 Whole Loan has a 10-year term and will be interest-only for the term of the loan.

 

Whole Loan Summary
NoteOriginal BalanceCut-off Date BalanceNote HolderControlling Piece
A-1-S, A-2-S$500,000$500,000MOFT 2020-B6No
A-1-C5, A-2-C$57,750,000$57,750,000Benchmark 2020-B19No(1)
A-1-C1, A-1-C2, A-1-C3, A-1-C4, A-1-C6$74,850,000$74,850,000Benchmark 2020-B20No
B-1, B-2$66,900,000$66,900,000MOFT 2020-B6Yes(1)
Whole Loan$200,000,000$200,000,000 
(1)The initial controlling notes are Note B-1 and Note B-2, so long as no Moffett Place - Building 6 control appraisal period has occurred and is continuing. If and for so long as a Moffett Place - Building 6 control appraisal period has occurred and is continuing, then the controlling note will be the Note A-1-C5. See “Description of the Mortgage Pool—The Whole Loans—The Moffett Place - Building 6 Pari Passu-AB Whole Loan” in the Preliminary Prospectus. The Moffett Place - Building 6 Whole Loan is being serviced pursuant to the MOFT 2020-B6 trust and servicing agreement. For so long as no Moffett Place - Building 6 control appraisal period has occurred and is continuing, the control rights of the Moffett Place - Building 6 Junior Notes will be exercisable by the controlling class under the MOFT 2020-B6 trust and servicing agreement.

 

The Borrower. The borrower is MP B6 LLC. The borrower is structured to be a single purpose entity with two independent directors in its organizational structure.

 

The Loan Sponsor. The loan sponsor is Joseph K. Paul, also known as Jay Paul, and the non-recourse carveout guarantor is Paul Guarantor LLC. Jay Paul is the founder of Jay Paul Company, which is a privately-held real estate firm based in San Francisco, California that concentrates on the acquisition, development and management of commercial properties throughout California with a specific focus on creating projects for technology firms. Jay Paul Company has developed over 13.0 million square feet of institutional quality space including projects for Apple, Amazon, Facebook, Google, Microsoft, HP, Rambus, Nokia, Tencent and DreamWorks. Jay Paul Company owns over 25 office buildings in Moffett Park, totaling nearly 7.2 million square feet including Moffett Place, Moffett Gateway, Technology Corner, Moffett Towers, Moffett Towers II and Moffett Towers Buildings A, B & C.

 

The Property. The Moffett Place - Building 6 property is a newly-constructed eight-story, Class A LEED Gold Certified, office building totaling 314,352 square feet located in Sunnyvale, California. The Moffett Place - Building 6 property is part of a larger six building, 55 acre campus known as Moffett Place (the “Moffett Campus”), which in the aggregate (including the Moffett Place - Building 6 property) includes approximately 1.9 million square feet of Class A office space that is 100.0% leased to Google, an approximately 52,500 square feet amenities building including a conference center, a swimming pool, an outdoor common area space, a café and three separate parking structures and surface parking. The overall parking ratio is 3.3 spaces per 1,000 square feet of net rentable area. The rooftop level (level 3) on one of the parking structures is improved with the landlord's "High Garden" concept as a project amenity. The "High Garden" features walking and running trails, outdoor volleyball, bocce ball courts and other recreational features.

 

To govern access to the non-collateral common areas, conference facility and parking structures (the “Common Area Spaces”), the Moffett Place - Building 6 property is subject to a declaration of covenants, conditions and restrictions (the “Moffett Place CCR”) with Moffett Place LLC (an affiliate of the loan sponsor and an affiliate of the owner of the non-collateral buildings at the Moffett Campus). The Moffett Place CCR grants the borrower non-exclusive easement rights over the Common Area Spaces. Ownership of the Common Area Spaces governed by the Moffett Place CCR is held by Moffett Place Association LLC (the “Association”).

 

The Moffett Place - Building 6 property is 100.0% leased to Google (Google’s parent company, Alphabet Inc. (NASDAQ: GOOG) is rated Aa2/AA+ by Moody’s/S&P) pursuant to a new 8.7-year triple net lease through January 2029, with two, seven-year extension options and

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 17 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
Moffett Place - Building 6

 

no early termination rights. Google has an in place base rent of $49.56 per square foot with approximately 2.2% annual rent escalations. The Google lease commenced on May 21, 2020 and Google has fully accepted its space with no outs or remaining landlord work. Google is in the process of building out its space with an expected occupancy date by September/October of 2021. Google was provided $55.10 per square foot in tenant improvements and approximately 12 months of free rent. At loan origination, approximately $2.7 million was reserved for the remaining outstanding tenant obligations and approximately $12.1 million for free rent.

 

Under the Google lease, so long as the landlord owns the Moffett Place - Building 6 property, Google has a right of first offer to purchase all or any portion of the six building Moffett Campus which the landlord has determined in its sole discretion to sell. Such right excludes an offer to sell one or more buildings in the Moffett Campus to an affiliate of the landlord or to an entity or person that becomes the owner of the Moffett Place - Building 6 property or the Moffett Campus through a foreclosure by trustee’s power of sale, judicially or otherwise, or as a purchaser at a foreclosure sale.

 

COVID-19 Update. On July 27, 2020, due to the COVID-19 pandemic, Google announced that it would extend its global voluntary work-from-home option through June of 2021 for roles of employees that are not needed in the office. Google had originally told employees to expect to return to the office in January of 2021. As of October 1, 2020, Google has not made any requests for rent relief. Google is in a free rent period through May 2021. As of October 1, 2020, the Moffett Place – Building 6 Whole Loan is not subject to any modification or forbearance requests related to the COVID-19 pandemic. The Moffett Place – Building 6 Whole Loan is current as of the September 2020 payment date. See “Risk Factors—Risks Related to Market Conditions and Other External Factors—Current Coronavirus Pandemic May Adversely Affect the Global Economy and the Performance of the Mortgage Loans” in the Preliminary Prospectus.

 

The Market. The Moffett Place - Building 6 property is located in Moffett Park, a submarket of Sunnyvale in Silicon Valley, California. Moffett Park comprises 519 acres which has undergone significant redevelopment over the past 15 years. The area has grown into one of the San Francisco Bay Area’s technology hubs, with firms such as Amazon, Google, Facebook, Comcast, and Verizon (Yahoo!) leasing significant space. Moffett Park is located adjacent to State Highway 237, Interstate 680, Interstate 280, and U.S. Highway 101 and has access from both the northern peninsula and areas in San Jose and the East Bay, making it a convenient location for corporate users.

 

Regional commuter service is indirectly provided for Moffett Park. Shuttles from Downtown Sunnyvale Caltrain station and the Altamont Commuter Express Great America station provide morning and evening services to the park. Future indirect regional access may be provided by the Bay Area Rapid Transit (“BART”) to San Jose extension. The BART extension would provide service potential from East Bay cities to downtown San Jose where additional shuttle or VTA light rail connections would be necessary to serve Moffett Park.

 

The VTA light rail Borregas Station is located within a half mile of the Moffett Place - Building 6 property along Java Drive, while the Java / Borregas bus stop is a five minute walk away. Access to major highways 101 and 237 is within a mile of the Moffett Place - Building 6 property and the downtown Sunnyvale Caltrain station is approximately three miles to the south. The San Jose International Airport is located about nine miles from the Moffett Place - Building 6 property.

 

According to the appraisal, the Moffett Park office submarket had a vacancy rate of 0.6% with an average asking rent of $69.60 per square foot. The following chart summarizes comparable office leases that range in base rent from $50.40 to $60.00 per square foot.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 18 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
Moffett Place - Building 6

 

 Summary of Comparable Office Leases(1)   
PropertyTenant NameLease
Start Date
Term
(mos.)
Lease TypeTenant
Size (SF)
Base
Rent PSF
Free Rent
(mos.)
TI PSF
Moffett Place -Building 6GoogleMay-20105NNN314,352(2)$49.56(2)12$55.10
Moffett Towers II -Building IIIFacebookJan-20180NNN1,087,689$52.207$60.00
520 Almanor AvenueNokia, IncApr-19150NNN231,000$50.406$80.00
Grove 22123 and MeMay-19144NNN154,987$60.009$83.71
1001 North ShorelineGoogleApr-18144NNN132,960$60.003$50.00
Pathline ParkSynopsysNov-19144NNN360,100$51.000$70.00
620 National ViewGoogleDec-18120NNN151,065$59.400$80.00
Total / Wtd. Avg.(3)  161 2,117,801$53.375$66.42

(1)Source: Appraisal.

(2)Based on the rent roll as of October 6, 2020.

(3)Total / Wtd. Avg. excludes the Moffett Place - Building 6 property.

 

  Summary of Comparable Office Sales(1)    
PropertyCity, StateNRAYear Built/RenovatedOccupancyTransaction DateSales PriceSales Price PSFCap Rate
Moffett Place - BuildingSunnyvale, CA314,3522020100.0%NAPNAPNAPNAP
620 National ViewMountain View, CA151,0652017100.0%Sep-19$190,000,000$1,2584.8%
Grove 221Sunnyvale, CA154,9872018100.0%Mar-19$183,000,000$1,1815.1%
Shoreline TechnologyMountain View, CA795,6631985 / 200092.0%Nov-18$1,000,000,000$1,2573.5%
1001 North ShorelineMountain View, CA132,9602017100.0%Mar-18$169,000,000$1,1584.4%
Menlo GatewayMenlo Park, CA772,9832019100.0%Nov-17$850,000,000$1,1005.0%
Total / Wtd. Avg.(2) 2,007,658 96.8% $763,194,608$1,1844.4%

(1)Source: Appraisal.

(2)Total / Wtd. Avg. excludes the Moffett Place - Building 6 property.

 

Historical and Current Occupancy(1)
201720182019Current(2)
NAPNAPNAP100.0%
(1)Historical information is not available due to the recent construction of the Moffett Place - Building 6 property.

(2)Based on the rent roll as of October 6, 2020.

 

Tenant Summary(1)
TenantRatings Moody’s/Fitch/S&P(2)Net Rentable Area (SF)% of
Total NRA
Base Rent
PSF
% of Total
Base Rent
Lease
Expiration Date
GoogleAa2 / NR / AA+ 314,352100.0% $49.56 100.0% 1/31/2029
Total 314,352100.0%$49.56100.0% 
Other Occupied 00.0   $0.000.0    
Total Occupied 314,352100.0%$49.56100.0% 
Vacant 00.0      
Total 314,352100.0%   

(1)Based on the rent roll as of October 6, 2020.

(2)Credit Ratings are those of the parent company. The tenant is the sole obligor with respect to the lease obligation.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 19 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
Moffett Place - Building 6

 

Lease Rollover Schedule(1)
Year

Number

of Leases Expiring

Net Rentable

Area Expiring

% of NRA

Expiring

Base Rent

Expiring

% of

Base

Rent

Expiring

Cumulative Net Rentable Area

Expiring

Cumulative

% of NRA Expiring

Cumulative

Base Rent Expiring

Cumulative

% of Base

Rent Expiring

VacantNAP00.0%NAPNAP00.0%NAPNAP
MTM & 2020000.0$00.0%00.0%$00.0%
2021000.000.000.0%$00.0%
2022000.000.000.0%$00.0%
2023000.000.000.0%$00.0%
2024000.000.000.0%$00.0%
2025000.000.000.0%$00.0%
2026000.000.000.0%$00.0%
2027000.000.000.0%$00.0%
2028000.000.000.0%$00.0%
20291314,352100.015,579,285100.0314,352100.0%$15,579,285100.0%
2030000.000.0314,352100.0%$15,579,285100.0%
2031 and Thereafter000.000.0314,352100.0%$15,579,285100.0%
Total1314,352100.0%$15,579,285100.0%    

(1)Based on the rent roll as of October 6, 2020.

 

Underwritten Net Cash Flow(1)
 UnderwrittenUnderwritten
$ Per Square Foot
%(2)
Base Rent$15,579,285$49.5677.9%
Straight Line Rent Credit(3)1,297,9704.136.5%
Amenities Rent469,7791.492.4%
Reimbursements2,642,6088.4113.2%
Net Rental Income$19,989,641$63.59100.0%
Vacancy & Credit Loss(4)(999,482)(3.18)(5.0%)
Effective Gross Income$18,990,159$60.4195.0%
    
Real Estate Taxes$592,541$1.883.1%
Insurance221,5280.701.2%
Management Fee168,7730.540.9%
Other Operating Expenses1,709,5725.449.0%
Total Operating Expenses$2,692,414$8.5614.2%
    
Net Operating Income$16,297,746$51.8585.8%
TI/LC323,1021.031.7%
Capital Expenditures64,6200.210.3%
Net Cash Flow$15,910,023$50.6183.8%

(1)Historical cash flow information is not available due to the recent construction of the Moffett Place – Building 6 property

(2)% column represents percent of Net Rental Income for all revenue lines and represents percent of Effective Gross Income for the remainder of the fields.

(3)Straight Line Rent Credit is given to Google through the lease term.

(4)Represents an underwritten economic vacancy of 5.0%.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 20 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
Moffett Place - Building 6

 

Property Management. The Moffett Place - Building 6 property is managed by Paul Holdings, Inc., an affiliate of the borrower.

 

Escrows and Reserves. At loan origination, the borrower was required to deposit the following into upfront reserves: (i) $2,728,059 into a TI/LC reserve for outstanding tenant obligations, (ii) $2,496,716 into a debt service reserve (equal to three months of Moffett Place - Building 6 Total Debt service payments) and (iii) $12,062,876 into a free rent reserve.

 

Tax Reserve – The borrower is required to deposit into a real estate tax reserve, on a monthly basis, 1/12 of the estimated annual real estate taxes (initially estimated at $85,000 per month).

 

Insurance Reserve – The borrower is required to deposit into an insurance reserve, on a monthly basis, 1/12 of estimated insurance premiums, unless an acceptable blanket policy is in effect. As of the origination date, an acceptable blanket policy was in place.

 

Lease Sweep Reserve – During a Lease Sweep Period (as defined below), all excess cash flow after payment of debt service, required reserves and budgeted operating expenses is required to be transferred to a lease sweep reserve until amounts on deposit equal the Lease Sweep Reserve Cap (as defined below). In the event that excess cash flow is not sufficient to meet the Required Minimum Monthly Lease Sweep Deposit Amount (as defined below), the borrower is required to deposit the Required Monthly Lease Sweep Deposit Amount into the lease sweep reserve.

 

A “Lease Sweep Period” will commence upon the earliest to occur of any of the following: (i) Google or a Lease Sweep Tenant Party (as defined below) fails to give notice of its intent to renew or extend the Google lease by May 31, 2027, which is 20 months prior to the lease expiration date until Google has exercised a renewal or an extension under the Lease Sweep Lease (as defined below) or a replacement tenant acceptable to lender executes a replacement lease covering the Requisite Lease Sweep Space (as defined below) or the total amount swept into the lease sweep reserve equals the applicable Lease Sweep Reserve Cap; (ii) the date on which (a) a Lease Sweep Tenant Party cancels or terminates its Lease Sweep Lease with respect to all or at least 41,000 square feet of the Lease Sweep Space (as defined below) prior to the then current expiration date or (b) a Lease Sweep Tenant Party delivers to borrower or manager a notice to terminate its Lease Sweep Lease with respect to all or at least 41,000 square feet of the Lease Sweep Space until either a renewal or retenanting occurs or the total amount swept into the lease sweep reserve equals the applicable Lease Sweep Reserve Cap; (iii) the Lease Sweep Tenant Party ceases operating its business in 20.0% or more of the space in a building subject to its leases (the “Dark Space”) (unless such tenant ceasing to operate is (a) Google, or (b) one or more investment grade entities, until a replacement tenant acceptable to lender executes a replacement lease covering the Requisite Lease Sweep Space or the total amount swept into the lease sweep reserve equals the applicable Lease Sweep Reserve Cap (clauses (i) through (iv) collectively, a “Lease Sweep Trigger”); (iv) a default under the lease by the Lease Sweep Tenant Party, until either such default is cured and no other default occurs for three consecutive months or the total amount swept into the lease sweep reserve equals the applicable Lease Sweep Reserve Cap; (v) a bankruptcy of Google or any parent entity under the applicable lease, until the related bankruptcy proceedings have terminated and the applicable lease has been affirmed, assumed or assigned in a manner satisfactory to the lender; and (vi) with respect to the Google lease, the date on which neither Google nor its parent company is an investment grade entity (a “Google Downgrade Event”), until one of (a) such tenant (or its parent company) becomes an investment grade entity again, (b) a renewal or re-tenanting occurs or (c) the total amount swept into the lease sweep reserve equals the applicable Lease Sweep Reserve Cap.

 

A “Lease Sweep Tenant Party” means any tenant under a Lease Sweep Lease or its direct or indirect parent company.

 

A “Lease Sweep Lease” means (i) the Google lease or (ii) any lease which is entered into by the borrower in replacement of any Google lease, and that, either individually, or when taken together with any other lease with the same tenant or its affiliates, and assuming the exercise of all expansion rights and all preferential rights to lease additional space contained in such replacement lease, demises Lease Sweep Space equal to or greater than the Requisite Lease Sweep Space.

 

The “Lease Sweep Space” means the space demised under a Lease Sweep Lease.

 

The “Requisite Lease Sweep Space” means 75% or more of the rentable SF demised under the applicable Lease Sweep Lease.

 

A “Required Minimum Monthly Lease Sweep Deposit Amount” means on each monthly payment date during the continuance of a Lease Sweep Period, an amount equal to: (i) from the payment date in September 2020 through October 2021, $475,000, (ii) from the payment date in November 2021 through October 2022, $505,000, (iii) from the payment date in November 2022 through October 2023, $535,000, (iv) from the payment date in November 2023 through October 2024, $555,000, (v) from the payment date in November 2024 through October 2025, $585,000, (vi) from the payment date in November 2025 through October 2026, $615,000 and (vii) from the payment date in November 2026 and thereafter, $628,700; provided that with respect to a Lease Sweep Period pursuant to clause (v) of the definition of Lease Sweep Period, such amount will be $0.00 on the date that funds then on deposit in the lease sweep reserve equal or exceed $15,717,600.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 21 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
Moffett Place - Building 6

 

A “Lease Sweep Reserve Cap” means: (i) with respect to a Lease Sweep Period continuing solely pursuant to clause (i) of the defined term “Lease Sweep Period”, an amount equal to $40.00 per rentable square foot that is leased pursuant to the Lease Sweep Lease in question; (ii) with respect to a Lease Sweep Period continuing solely pursuant to clause (iv) of the defined term “Lease Sweep Period”, $35.00 per rentable square foot that is leased pursuant to the Lease Sweep Lease in question; (iii) with respect to a Lease Sweep Period continuing solely pursuant to clause (ii) of the defined term “Lease Sweep Period”, $40.00 per rentable square foot of the terminated space; (iv) with respect to a Lease Sweep Period continuing pursuant to a Dark Period Event (clause (iii) of the defined term “Lease Sweep Period”), whether or not a Lease Sweep Trigger pursuant to clauses (i), (ii) and/or (iv) of the defined term “Lease Sweep Period” is concurrently continuing, $50.00 per rentable square foot of Dark Space; (v) with respect to a Lease Sweep Period continuing pursuant to a Google Downgrade Event (clause (vi) of the defined term “Lease Sweep Period”), whether or not a Lease Sweep Trigger pursuant to clauses (i), (ii), (iii) and/or (iv) of the defined term “Lease Sweep Period” is concurrently continuing, $15,717,600 (i.e., $50.00 per rentable square foot that is leased pursuant to the Lease Sweep Lease in question).

 

Lockbox / Cash Management. The Moffett Place - Building 6 Whole Loan is structured with a hard lockbox and in place cash management. The borrower is required to direct all existing tenants of the Moffett Place - Building 6 property to directly deposit all rents into a deposit account controlled by the lender. Funds in the deposit account are required to be applied and disbursed in accordance with the Moffett Place - Building 6 Whole Loan documents. During a Trigger Period (as defined below), all excess cash after payment of the monthly debt service on the Moffett Place - Building 6 Whole Loan, all required reserves and budgeted operating expenses, and certain other items in the payment waterfall described in the Moffett Place - Building 6 Whole Loan documents will be reserved (i) if a Lease Sweep Period is continuing, into the lease sweep reserve until the aggregate amount of funds transferred into such reserve during the Lease Sweep Period in question equals the applicable Lease Sweep Reserve Cap, if any, (ii) if a DS Reimbursement Period (as defined below) is continuing, into the debt service reserve account, and (iii) if no DS Reimbursement Period is continuing, into a cash collateral account as additional collateral for the Moffett Place - Building 6 Whole Loan.

 

A “Trigger Period” will commence upon (i) the occurrence of an event of default under the Moffett Place - Building 6 Whole Loan until cured, (ii) (A) the Moffett Place - Building 6 property not fully being leased to either Google or an investment grade entity and (B) the debt service coverage ratio being less than (a) 2.19x based on the Moffett Place - Building 6 Whole Loan and (b) 1.50x based on the Moffett Place - Building 6 Total Debt (a “Low DSCR Period”) until (x) the debt service coverage ratio based on the Moffett Place - Building 6 Whole Loan is equal to or greater than 2.19x and the debt service coverage ratio based on the Moffett Place - Building 6 Total Debt is equal to or greater than 1.50x, in each case, for one calendar quarter or (y) funds on deposit in the cash collateral account equal $15,717,600, (iii) the commencement of a Lease Sweep Period until such Lease Sweep Period is cured, (iv) the occurrence of a mezzanine loan default until the mezzanine lender notifies the lender that such mezzanine loan default has been cured or waived or (v) the commencement of a DS Reimbursement Period until such DS Reimbursement Period has ended.

 

A “DS Reimbursement Period” will commence upon (i) the allocation of any debt service reserve funds to any required debt service amounts pursuant to the Moffett Place - Building 6 Whole Loan documents and will end upon the earlier to occur of (a) the satisfaction of all DS Reserve Release Conditions (as defined below) and (b) the satisfaction of all DS Reimbursement Obligations (as defined below).

 

The “DS Reserve Release Conditions” means each of the following requirements has been satisfied: (i) no Trigger Period has occurred and is continuing (unless the Trigger Period is solely ongoing in connection with an ongoing DS Reimbursement Period) and (ii) with respect to the Google lease, the borrower has delivered evidence reasonably satisfactory to the lender that all contingencies under the Google lease have been satisfied and Google has actually commenced the payment of full contractual rent and any initial free rent period or period of partial rent abatements has expired.

 

The “DS Reimbursement Obligations” means the obligation of the borrower to reimburse to the lender all amounts disbursed from the lender-controlled debt service reserve.

 

Current Mezzanine or Subordinate Indebtedness. The Moffett Place - Building 6 Whole Loan consists of nine pari passu senior notes with an aggregate initial principal balance of $133,100,000 and two junior notes, with an aggregate initial principal balance of $66,900,000. In conjunction with the Moffett Place - Building 6 Whole Loan, on August 6, 2020, Security Benefit Life Insurance Company funded a $49.0 million mezzanine loan (and together with the Moffett Place - Building 6 Whole Loan, the “Moffett Place - Building 6 Total Debt”). The mezzanine loan has a fixed interest rate per annum of 6.35000% and maturity date of August 6, 2030. The Cut-off Date LTV Ratio, Maturity Date LTV Ratio, DSCR Based on Underwritten NCF and Debt Yield Based on Underwritten NOI for the Moffett Place - Building 6 Total Debt are set forth below:

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 22 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
Moffett Place - Building 6

 

Financial Information
 Senior NotesWhole LoanTotal Debt
Cut-off Date Balance$133,100,000$200,000,000$249,000,000
Cut-off Date LTV Ratio37.1%55.7%69.3%
Maturity Date LTV Ratio37.1%55.7%69.3%
DSCR Based on Underwritten NCF3.50x2.33x1.59x
Debt Yield Based on Underwritten NOI12.2%8.1%6.5%

 

Future Mezzanine or Subordinate Indebtedness Permitted. None.

 

Partial Release. None.

 

Common Area Subdivision: The borrower, together with certain affiliates, may seek to reconfigure and reduce the Common Area Spaces and transfer a portion of the Common Area Spaces to an affiliate of the borrower or the Association to allow for the construction of one or more office buildings and associated common area improvements, to be owned in fee by an affiliate of borrower or of the Association (the Common Area Subdivision and Release”). In connection with such transfer, the borrower and other members of the Association intend to amend the terms of the Moffett Place CCR to allow such Common Area Subdivision and Release. The Moffett Place - Building 6 Whole Loan documents permit the borrower to effectuate a Common Area Subdivision and Release subject to the satisfaction of certain terms and conditions, including, among others: (a) such subdivision and release (i) will not materially adversely interfere with any tenant’s use of its leased premises upon the Moffett Place - Building 6 property pursuant to the terms of its lease, (ii) will not materially adversely affect the Moffett Place - Building 6 property or its use or operation, (iii) does not violate the terms of any document or instrument relating to the Moffett Place - Building 6 property or Common Area Spaces, including any lease, reciprocal easement agreement or the Moffett Place CCR, (iv) will not cause any portion of the Moffett Place - Building 6 property and/or the reduced common area to be in violation of any legal requirements (including with respect to zoning and parking), and (v) does not create any liens on the Moffett Place- Building 6 property or Common Area Spaces and (b) not less than 20 days prior to the date of the commencement of such Common Area Subdivision and Release, the borrower submits to the lender copies of all plans, specifications, permits and approvals (as well as drafts of any shared facilities, access, infrastructure or parking easements to be entered into in connection with such Common Area Subdivision and Release), each as reasonably requested by the lender. Notwithstanding the foregoing, no such Common Area Subdivision and Release will be permitted if at the time of the effectuation of such Common Area Subdivision and Release, and after giving effect thereto, in the lender’s good faith discretion, the ratio of the unpaid principal balance of the Moffett Place - Building 6 Whole Loan to the value of the remaining Moffett Place - Building 6 property is greater than 125%.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 23 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
120 Wall Street

 

 

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 24 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
120 Wall Street

 

 

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 25 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
120 Wall Street

 

 

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 26 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
120 Wall Street

 

Mortgage Loan Information
Mortgage Loan Sellers(1):JPMCB/CREFI
Original Principal Balance(2):$70,000,000
Cut-off Date Principal Balance(2):$70,000,000
% of Pool by IPB:7.7%
Loan Purpose:Refinance
Borrower:120 Wall Property Owner, LLC
Loan Sponsor:Silverstein Holdco I LLC
Interest Rate:3.20100%
Note Date:10/1/2020
Maturity Date:10/11/2030
Interest-only Period:120 months
Original Term:120 months
Original Amortization:None
Amortization Type:Interest Only
Call Protection(3):YM(24),DeforYM(92),O(4)
Lockbox / Cash Management:Hard / Springing
Additional Debt(2):Yes
Additional Debt Balance(2):$95,000,000
Additional Debt Type:Pari Passu
  
 

 

Escrows and Reserves(6)
InitialMonthlyInitial Cap
Taxes:$1,306,557$326,640N/A
Insurance:$0SpringingN/A
Replacement Reserves:$0Springing$501,207
TI/LC:$3,472,525$111,379$4,009,656
Other:$1,759,579$0N/A
 
Property Information
Single Asset / Portfolio:Single Asset
Title:Fee
Property Type – Subtype:Office – CBD
Net Rentable Area (SF):668,276
Location:New York, NY
Year Built / Renovated:1929 / 2013
Occupancy:95.1%
Occupancy Date:8/31/2020
Number of Tenants:37
2017 NOI(4):$12,487,548
2018 NOI(4):$10,046,537
2019 NOI(4):$12,952,334
TTM NOI (as of 7/2020)(5):$13,190,289
UW Economic Occupancy:94.0%
UW Revenues:$28,608,590
UW Expenses:$13,183,745
UW NOI(5)(7):$15,424,845
UW NCF(5)(7):$14,656,328
Appraised Value / Per SF(7):$285,000,000 / $426
Appraisal Date:8/25/2020
 

 

Financial Information(2)(7)
Cut-off Date Loan / SF:$247
Maturity Date Loan / SF:$247
Cut-off Date LTV:57.9%
Maturity Date LTV:57.9%
UW NCF DSCR:2.74x
UW NOI Debt Yield:9.3%
 


Sources and Uses
SourcesProceeds% of TotalUsesProceeds% of Total
Whole Loan$165,000,000100.0%Payoff Existing Debt$135,478,87582.1%
   Return of Equity20,711,67212.6   
   Upfront Reserves6,538,6614.0   
   Closing Costs2,270,7921.4   
Total Sources$165,000,000100.0%Total Uses$165,000,000100.0%
(1)The 120 Wall Street Whole Loan (as defined below) was co-originated by Wells Fargo Bank, National Association (“WFB”), JPMorgan Chase Bank, National Association. (“JPMCB”) and Citi Real Estate Funding Inc. (“CREFI”) on October 1, 2020. JPMCB will be contributing $35,000,000 (Notes A-4 and A-5) and CREFI will be contributing $35,000,000 (Notes A-6 and A-7) to the Benchmark 2020-B20 transaction.

(2)The 120 Wall Street Loan (as defined below) is part of the 120 Wall Street Whole Loan evidenced by seven pari passu notes with an aggregate original principal balance as of the Cut-off Date of $165.0 million. Financial information presented in the chart above reflects the aggregate Cut-off Date balance of the $165.0 million 120 Wall Street Whole Loan.
(3)The defeasance lockout period will be at least 24 payment dates beginning with and including the first payment date of November 2020. Defeasance of the 120 Wall Street Whole Loan is permitted at any time after the earlier to occur of (a) the end of the two-year period commencing on the closing date of the securitization of the last promissory note representing a portion of the 120 Wall Street Whole Loan to be securitized and (b) the payment date occurring in November 2023. The assumed defeasance lockout period of 24 months is based on the expected closing date of the Benchmark 2020-B20 securitization in October 2020. The actual defeasance lockout period may be longer. Additionally, the borrower may prepay the 120 Wall Street Whole Loan at any time during the term of the 120 Wall Street Whole Loan with a 15-day prior notice and, if such prepayment date occurs before July 11, 2030, upon payment of the yield maintenance premium.
(4)The decrease from 2017 NOI to 2018 NOI and subsequent increase from 2018 NOI to 2019 NOI is primarily attributable to new leases executed in 2018 accounting for 11.4% of net rentable area and 12.9% of underwritten base rent. In connection with executing such leases, the Borrower (as defined below) provided new tenants with free rent periods accounting for an adjustment of approximately $2,427,673 in 2018 base rent.
(5)The increase from TTM NOI (as of 7/2020) to UW NOI at the 120 Wall Street property is primarily attributable to (i) new leases commencing in 2020 and 2021 accounting for an increase of approximately $1.9 million in underwritten base rent and (ii) approximately $298,037 in contractual rent steps through November 2021.
(6)For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 27 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
120 Wall Street

 

(7)While the 120 Wall Street Whole Loan was originated after the emergence of the novel coronavirus pandemic and the economic disruption resulting from measures to combat the pandemic, the pandemic is an evolving situation and could impact the 120 Wall Street Whole Loan more severely than assumed in the underwriting of the 120 Wall Street Whole Loan and could adversely affect the NOI, NCF and occupancy information, as well as the appraised value and the DSCR, LTV and Debt Yield metrics presented above. See “Risk Factors— Risks Related to Market Conditions and Other External Factors—Coronavirus Pandemic Has Adversely Affected the Global Economy and Will Likely Adversely Affect the Performance of the Mortgage Loans” in the Preliminary Prospectus.

 

The Loan. The 120 Wall Street loan is part of a whole loan evidenced by seven pari passu promissory notes, each as described below, with an aggregate original principal balance as of the Cut-off Date of $165.0 million (the “120 Wall Street Whole Loan”), secured by the ESD’s (as defined below) fee simple interest and the borrower’s leasehold interest in a 668,276 square foot, Class B, CBD office building located in New York, New York. The non-controlling notes A-4, A-5, A-6 and A-7, with an aggregate outstanding principal balance as of the Cut-off Date of $70.0 million, will be included in the Benchmark 2020-B20 Trust. The remaining notes, which are currently held by WFB, are expected to be contributed to one or more future securitization trusts. The relationship between the holders of the 120 Wall Street Whole Loan will be governed by a co-lender agreement as described under “Description of the Mortgage Pool—The Whole Loans— The Serviced Pari Passu Whole Loans” in the Preliminary Prospectus. The 120 Wall Street Whole Loan has a 10-year term and is interest only for the full term of the loan.

 

  Whole Loan Summary 
NoteOriginal BalanceCut-off Date BalanceNote HolderControlling Piece
Note A-1(1)$70,000,000$70,000,000WFBYes
Note A-2(1)$10,000,000$10,000,000WFBNo
Note A-3(1)$15,000,000$15,000,000WFBNo
Note A-4, A-5, A-6, A-7(2)$70,000,000$70,000,000Benchmark 2020-B20No(3)
Whole Loan$165,000,000$165,000,000 
(1)Expected to be contributed to one or more future securitization transactions.
(2)JPMCB will be contributing Note A-4 and Note A-5, which have an aggregate outstanding principal balance of approximately $35,000,000, to the Benchmark 2020-B20 mortgage trust. CREFI will be contributing Note A-6 and Note A-7, which have an aggregate outstanding principal balance of approximately $35,000,000, to the Benchmark 2020-B20 mortgage trust.

(3)The 120 Wall Street Whole Loan is expected to be serviced under the Benchmark 2020-B20 pooling and servicing agreement until such time as the controlling note has been securitized, at which point the 120 Wall Street Whole Loan will be serviced under the pooling and servicing agreement related to such securitization.

 

The Borrower. The borrower is 120 Wall Property Owner, LLC (the “Borrower”), a Delaware limited liability company and single purpose entity with two independent directors.

 

The borrower sponsor is Silverstein Properties, Inc. (“Silverstein Properties”) and the non-recourse carveout guarantor is Silverstein Holdco I LLC. Silverstein Properties is a privately held, full-service real estate development, investment and management firm based in New York. Founded in 1957, Silverstein has developed, owned and managed more than 40 million square feet of office, residential, hotel, retail and mixed-use properties. Silverstein Properties is widely recognized for their role in rebuilding the World Trade Center following the tragic events of September 11, 2001. Silverstein Properties’ commercial and residential portfolio, includes over 12 million square feet of office and residential properties in Midtown and Lower Manhattan.

 

The Property. The 120 Wall Street property is a 35-story, 668,276 square foot, Class B, LEED Gold certified office building located in the Financial District of Manhattan in New York City. The property was constructed in 1929 and most recently renovated in 2013. The borrower sponsor purchased the 120 Wall Street property in 1980 and has invested significant capital to reposition and modernize the building. In 2005, the borrower sponsor restored the façade of the building, entrance and distinctive art deco lobby enhancing the building’s appeal. Since 2012, the borrower sponsor has invested $11.0 million in capital improvements ($16.47 per square foot) including a $4.5 million lobby renovation that includes the expansion and widening of the lobby footprint, new revolving doors, installing turnstiles, new flooring, new lighting, new security desks and restoration of interior lobby walls, as well as an approximately $3.4 million elevator modernization. The 120 Wall Street property is designated a historic landmark by the New York City Landmark’s Preservation Commission. Amenities at the 120 Wall Street property include unobstructed views across the East River, private terraces and around the clock security. As of August 31, 2020, the 120 Wall Street property was 95.1% occupied by 37 distinct tenants including 29 office tenants, five telecom tenants, two retail tenants and one management office.

 

The borrower sponsor has owned the 120 Wall Street property since 1980 and facilitated its designation as New York City’s first association center in 1992, which allows for not-for-profit (“NFP”) tenancy to receive financial incentives for leasing space at the 120 Wall Street property. On September 12, 2012, the 120 Wall Street property entered into a real estate tax program with the New York State Urban Development Corporation d/b/a Empire State Development (“ESD”), where the building was deeded to the ESD and leased back by the Borrower. Under the agreement the Borrower makes a payment in lieu of real estate taxes (“PILOT”). To the extent that NFP tenants lease space at the property, the Borrower’s PILOT amount reduces proportionately, resulting in expense savings. A portion of

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
120 Wall Street

 

the expense savings are then required to be passed back to the NFP tenant in the form of a rent credit. The ground lease expires on December 31, 2032 at which time the Borrower would obtain the fee ownership, repurchasing the deed for $1. There is no ground rent associated with the lease structure other than the PILOT tax payments for any for-profit tenants at the 120 Wall Street property. Under the program, any NFP tenant that executes a new lease or renews a current lease is eligible to participate in the program. Currently, 12 NFP tenants representing approximately 31.6% of net rentable area at the 120 Wall Street property participate in the program, resulting in an expected tax savings of approximately $1.6 million in 2020. 120 Wall Street is the only office building in Manhattan to offer this incentive for NFP tenants. The average NFP benefit is approximately $6.17 per square foot. See “Risk Factors—Risks Relating to the Mortgage Loans—Increases in Real Estate Taxes May Reduce Available Funds” in the Preliminary Prospectus.

 

The largest tenant, Droga5, LLC (202,396 square feet; 30.3% of net rentable area; 32.6% of underwritten base rent) (“Droga5”), is an international creative and strategic advertising agency that was founded in 2006. Droga5 was acquired by Accenture (NYSE: ACN) Interactive in May 2019. Droga5 has worked on advertising campaigns for some of the largest corporation in the world including Coca- Cola, Motorola, Mondelez International, Kraft Heinz Company, LVMH, Unilever and the United Nations. Droga5 executed its lease at the 120 Wall Street property in October 2013 for 91,442 square feet and expanded its space at the property in 2016 and 2018 for 52,320 square feet and 58,634 square feet, respectively. The 120 Wall Street property serves as the company’s global headquarters. Droga5 has a lease expiration of September 2029 with one, ten-year renewal option for the entire premises or at least two full contiguous floors exercisable with at least 15 months’ notice but no more than 24 months prior to expiration. Droga5 has no termination options.

 

The second largest tenant, Success Academy Charter School (54,658 square feet; 8.2% of net rentable area; 8.1% of underwritten base rent), was founded in 2006 and is the largest and highest-performing free, public charter school network in New York City. Admission is open to all New York State children in grades K-12, including those with special needs and English language learners. Success Academy operates 47 schools serving 20,000 students in Manhattan, Brooklyn, Queens and the Bronx. The non-profit organization ranks in the top 1% among all schools in the state in math and English for 2019. Success Academy Charter School utilizes its space at 120 Wall Street for office and administrative space. Success Academy Charter School has a lease expiration of June 2029 with no renewal options. Success Academy Charter School has a one-time right to terminate its lease for the entire premises effective August 31, 2024, with 12 months’ notice and a termination fee of $3,497,468. According to the appraisal, Success Academy Charter School currently receives an NFP benefit in the form of a rent credit amounting to approximately $244,937.

 

The third largest tenant, AFS-USA, Inc. (40,029 square feet; 6.0% of net rentable area; 5.9% of underwritten base rent) (“AFS”) is an international youth exchange organization consisting of over 50 independent non-profit organizations. AFS provides young people with immersive, international or intercultural experiences, supports them with structured and facilitated learning and gives them real world social-impact and change making exposure. In 2018 alone, AFS served over 66,000 students across nine countries, raised over $36 million in scholarships and had more than 12,000 study-abroad participants. AFS has a lease expiration of June 2029 with one, 10-year renewable option exercisable with notice provided no later than 12 months, but no earlier than 18 months, prior to the expiration date. AFS has a one-time right to terminate its lease for the entire premises effective June 30, 2024, with 18 months’ prior notice, subject to a termination fee equal to $2,593,000. According to the appraisal, AFS-USA, Inc. currently receives an NFP benefit in the form of a rent credit amounting to approximately $181,879.

 

COVID-19 Update. As of October 1, 2020, the 120 Wall Street property is open for operations. As of September 11, 2020, four tenants accounting for approximately 12.7% of net rentable area and 12.1% of underwritten base rent in aggregate have requested tenant relief in the form of rent modifications and deferral. The borrower sponsor has not formally agreed to any such agreement. For April, May, June, July and August, the borrower sponsor collected approximately 99%, 100% 100%, 95% and 92% of base rent, respectively. As of September 11, 2020, the third largest tenant at the 120 Wall Street property, AFS, which accounts for 6.0% of net rentable area and 5.9% of underwritten base rent, has requested a rent reduction or a reduction in its square footage on the fourth floor by approximately 18,000 square feet. Two additional tenants at the property, Geourgoulis / Cohen and The New Press, accounting for 2.1% of net rentable area and 2.2% of underwritten base rent, have missed a payment but are expected to make such payment in full by the end of 2020. As of October 1, 2020 the 120 Wall Street Whole Loan is not subject to any modification or forbearance requests. See “Risk Factors—Risks Related to Market Conditions and Other External Factors—Current Coronavirus Pandemic May Adversely Affect the Global Economy and the Performance of the Mortgage Loans”.

 

The Market. The 120 Wall Street property is situated in the Downtown East Office submarket of the Manhattan Office market. The 120 Wall Street Property is a short walk from the PATH, 4, 5, A, C, E, J, M, Z, W, R, 1, 2, 3 and the new Fulton Street Transit Center which provides access to New Jersey, Brooklyn and residential neighborhoods in Lower Manhattan. The FDR Drive, Brooklyn Bridge and Manhattan Bridge are accessible from the subject property and are located on the westernmost sections of Manhattan.

 

The Downtown East Office submarket had approximately 49.9 million square feet of inventory as of the second quarter of 2020. According to the appraisal, the Downtown East Office submarket had a vacancy rate as of second quarter 2020 of 7.0% and an average asking rent

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
120 Wall Street

 

of $56.27 per square foot. The appraisal identified 12 comparable office leases with rents ranging from $52.00 to $70.79 per square foot with a weighted average rent of approximately $59.97 per square foot. The 120 Wall Street property’s underwritten weighted average rent for occupied office space is approximately $40.41 per square foot, approximately 22.0% below the appraisal’s concluded market rent of $51.80 per square foot for the same spaces.

 

The traditional office tenant within the Downtown East office submarket primarily consisted of financial institutions, insurance companies, and real estate corporations, which are commonly referred to as “FIRE” tenants. However, based on the discounted rents when compared to many other submarkets throughout Manhattan, the Downtown East office submarket has redefined its typical tenancy base, signing large anchor leases to companies within the technology, advertising, media and information technology sector, which are commonly referred to as “TAMI” tenants. Due to the recalibration of the tenancy base throughout New York City, there is no longer one definitive corridor or office market that is centralized around one specific tenancy base.

 

According to the appraisal, the estimated 2020 population within a 0.25, 0.5, and 1-mile radius of the 120 Wall Street property is 9,835, 33,707, and 94,136, respectively. In addition, the appraisal states that the estimated 2020 average household income within a 0.25, 0.5, and 1-mile radius is $268,181, $247,402, and $196,812, respectively.

 

The following table presents certain information relating to the appraisal’s market rent conclusion for the 120 Wall Street property:

 

Summary of Appraisal’s Concluded Office and Retail Market Rent(1)
 
 Office 
StorageFloor (2)Floors (3-9)Floors (10-16)Floors (17-25)Floors (26-34)Retail (Grade)
$25.00$44.00$48.00$52.00$56.00$60.00$65.00
(1)Source: Appraisal.

  

 Historical Occupancy(1)  
 201720182019Current(2)
  Occupancy96.0%95.0%92.0%95.1%

(1)Historical occupancies are as of December 31 of each respective year.
(2)Current Occupancy is based on the August 31, 2020 rent roll.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
120 Wall Street

 

Tenant Summary(1)

Tenant

Ratings Moody’s/Fitch/S&P(2)Net Rentable Area (SF)% of Total NRABase Rent PSF(3)% of Total  Base RentLease  
Expiration Date
Droga5, LLC(4)Aa3 / A+ / A+202,39630.3%$41.5632.6%9/30/2029
Success Academy Charter School(5)NR / NR / NR54,6588.2  $38.358.16/30/2029
AFS-USA, Inc.(6)(7)NR / NR / NR40,0296.0  $37.955.96/30/2029
Foundation for AIDS ResearchNR / NR / NR30,8224.6  $33.974.18/31/2027
Center for Appellate Litigation(8)NR / NR / NR20,5353.1  $40.883.21/31/2025
Lambda Legal Defense & Education FundNR / NR / NR20,3213.0  $34.002.77/31/2027
Public Relations Society of America(9)NR / NR / NR19,4482.9  $48.003.62/28/2027
Lavazza Premium Coffees Corp.NR / NR / NR19,1732.9  $43.143.210/31/2027
Catalyst, Inc.NR / NR / NR18,1762.7  $41.002.97/31/2027
American Institute of Chemical EngineersNR / NR / NR16,7062.5  $38.332.53/31/2029
Total Major Office442,26466.2%$40.1468.7%
Other Occupied(10)(11)(12)193,40728.9   $41.7931.3  
Total Occupied635,67195.1%$40.64100.0%
Vacant 32,6054.9 
Total / Wtd. Avg.668,276100.0%
(1)Based on the underwritten rent roll dated August 31, 2020.
(2)In certain instances, ratings provided are those of the parent company of the entity shown, whether or not the parent company guarantees the lease.
(3)Base Rent PSF is inclusive of rent steps through November 2021 totaling $298,037.
(4)Jax Media is currently subleasing an additional 13,076 square feet from Droga5 through June 2029 at a base rental rate of $52.15 per square foot.
(5)Success Academy Charter School has a one-time right to terminate its lease for the entire premises effective August 2024, with 12 months’ notice and a termination fee of $3,497,468.
(6)AFS-USA, Inc. is currently subleasing an additional 13,076 square feet from Success Academy Charter School through June 2029 at a base rental rate of $39.00 per square foot.
(7)AFS-USA, Inc. has a one-time right to terminate its lease for the entire premises effective June 2024, with 18 months’ prior notice and a termination fee equal to $2,593,000.
(8)Center for Appellate Litigation is currently subleasing an additional 8,788 square feet from American Suicide Foundation through November 2021 at which point Center for Appellate Litigation will pay $58.00 per square foot pursuant to a direct lease thereafter.
(9)Kelley Jasons McGowan Spinelli Hanna & Reber, L.L.P (“KJMSHR”) is subleasing 2,442 square feet to Public Relations Society of America at a base rental rate of $46.00 per square foot through February 2027. KJMSHR leases no additional space at the 120 Wall Street property.
(10)Other Occupied is inclusive of 7,281 square feet of retail space.
(11)Other Occupied is inclusive of Pico Quantitative Trading which is currently dark. The tenant continues to pay rent in full at the 120 Wall Street property.
(12)Other Occupied includes a 2,253 square feet management office with no attributable base rent.

 

Lease Rollover Schedule(1)(2)

Year

Number of Leases Expiring

Net Rentable Area Expiring

% of NRA

Expiring

Base Rent Expiring% of Base Rent ExpiringCumulative Net Rentable Area Expiring

Cumulative

% of NRA Expiring

Cumulative Base Rent Expiring

Cumulative

% of Base Rent Expiring

VacantNAP32,6054.9%NAPNAP32,6054.9%NAPNAP
MTM & 2020160.0$00.0%32,6114.9%$00.0%
2021534,8695.21,406,5345.4%67,48010.1%$1,406,5345.4%
2022312,9501.9404,6081.6%80,43012.0%$1,811,1427.0%
2023321,6243.2812,9183.1%102,05415.3%$2,624,06010.2%
202423,9120.6195,4400.8%105,96615.9%$2,819,50010.9%
2025335,3065.31,441,3205.6%141,27221.1%$4,260,82016.5%
202616,0240.9219,8760.9%147,29622.0%$4,480,69617.3%
20277134,26920.15,166,72320.0%281,56542.1%$9,647,41937.3%
202814,3570.7157,5150.6%285,92242.8%$9,804,93438.0%
20296336,50550.413,546,99652.4%622,42793.1%$23,351,93090.4%
2030 and Thereafter(3)545,8496.92,481,9349.6%668,276100.0%$25,833,864100.0%
Total37668,276100.0%$25,833,864100.0%
(1)Based on the underwritten rent roll dated August 31, 2020.
(2)Certain tenants may have termination or contraction options (which may become exercisable prior to the originally stated expiration date of the tenant lease) that are not considered in the above Lease Rollover Schedule.
(3)2030 & Thereafter includes 2,253 square feet of management office with no attributable underwritten base rent.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
120 Wall Street

 

Operating History and Underwritten Net Cash Flow
 201720182019TTM(1)UnderwrittenPer Square
Foot
%(2)
Base Rent(3)$21,819,923$20,742,361$23,378,989$23,582,233$25,833,864$38.6685.7%
Vacant Income00001,821,8182.736.0
NFP Rent Credit(4)(875,867)(910,278)(947,348)(922,477)(967,163)(1.45)(3.2)
Gross Potential Rent$20,944,056$19,832,083$22,431,641$22,659,756$26,688,519$39.9488.5%
Total Reimbursements3,108,1263,395,9703,502,1793,321,0883,467,8205.1911.5
Gross Rental Income$24,052,182$23,228,053$25,933,820$25,980,844$30,156,339$45.13100.0%
(Vacancy/Credit Loss)0000(1,821,818)(2.73)(6.0)
Total Other Income(5)88,12071,433259,483274,069274,0690.410.9
Effective Gross Income$24,140,302$23,299,486$26,193,303$26,254,913$28,608,59042.8194.9%
Total Expenses11,652,75413,252,94913,240,96913,064,62413,183,74519.7346.1
Net Operating Income(6)(7)$12,487,548$10,046,537$12,952,334$13,190,289$15,424,84523.0853.9%
TI/LC0000668,2761.002.3
Capital Expenditures0000100,2410.150.4
Net Cash Flow$12,487,548$10,046,537$12,952,334$13,190,289$14,656,32821.9351.2%
(1)TTM represents the trailing 12-month period ending July 31, 2020.
(2)% column represents percent of Gross Rental Income for all revenue lines and represents percent of Effective Gross Income for the remainder of the fields.
(3)Underwritten Base Rent is inclusive of rent steps through November 2021 totaling $298,037.
(4)NFP Rent Credit is based on contractual rent credits for 12 NFP tenants representing approximately 32.9% of net rentable area at the 120 Wall Street property
(5)Total Other Income includes telecom income, license income, miscellaneous event income, lease cancellation fees and construction management fees.
(6)The increase from TTM NOI (as of 7/2020) to UW NOI at the 120 Wall Street property is primarily attributable to (i) new leases commencing in 2020 and 2021 accounting for an increase of approximately $1.9 million in underwritten base rent and (ii) contractual rent steps through November 2021.
(7)The decrease from 2017 NOI to 2018 NOI and subsequent increase from 2018 NOI to 2019 NOI is primarily attributable to new leases executed in 2018 accounting for 11.4% of net rentable area and 12.9% of underwritten base rent. In connection with executing such leases, the Borrower provided new tenants with free rent periods accounting for an adjustment of approximately $2,427,673 in 2018 base rent.

 

Property Management. The 120 Wall Street property is managed by Silverstein Properties, LLC, a Delaware limited liability company and an affiliate of the Borrower.

 

Escrows and Reserves. At loan origination, the Borrower deposited (i) $1,306,557 into a real estate tax reserve, (ii) $3,472,525 into an outstanding TI/LC reserve, including $415,000 for Hydra tenant improvements and (iii) $1,759,579 into a rent concession reserve funds consisting of (a) approximately $434,099 for Hydra, (b) approximately $176,067 for Droga5, LLC, (c) approximately $45,721 for Illuminating Engineers Society, (d) approximately $67,555 for Excess Line Association of New York, (e) approximately $908,712 for the Nathan Cummins Foundation, Inc and (f) approximately $127,426 for Center for Appellate Litigation.

 

Tax Reserve – On a monthly basis, the Borrower is required to deposit an amount equal to 1/12 of the estimated annual real estate taxes into the tax reserve account (initially $326,640).

 

Insurance Reserve – On a monthly basis, the Borrower is required to deposit into an insurance reserve an amount equal to 1/12 of estimated insurance premiums. So long as a blanket policy acceptable to the lender is in effect, the Borrower provides the lender evidence of timely payment of insurance premiums, and there is no event of default continuing, the requirement for monthly deposits into the insurance reserve is waived.

 

Replacement Reserve – On a monthly basis, during the continuance of a Cash Trap Event Period, the Borrower is required to deposit approximately $13,922 into a replacement reserve, subject to a cap of $501,207.

 

TI/LC Reserve – On a monthly basis, the Borrower is required to deposit approximately $111,379 into a TI/LC reserve, subject to a cap of $4,009,656.

 

Lockbox / Cash Management. The 120 Wall Street Whole Loan is structured with a hard lockbox and springing cash management. The Borrower is required to direct tenants to pay rent directly into the lender-controlled lockbox account and all rents received directly by the Borrower or the property manager are required to be deposited into the lockbox account within two business days of receipt. Prior to the occurrence of a Cash Trap Event Period, all funds in the lockbox account are required to be distributed to the Borrower. During a Cash Trap Event Period, funds in the lockbox account are required to be swept on each business day to a lender-controlled cash management account to be applied and disbursed in accordance with the 120 Wall Street Whole Loan documents. Any excess cash flow remaining after satisfaction of the waterfall items outlined in the loan documents is required to be swept to an excess cash flow subaccount controlled by the lender as additional collateral for the 120 Wall Street Whole Loan during the continuance of the Cash Trap Event Period. Provided

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
120 Wall Street

 

no event of default is continuing, any excess cash flow funds remaining in the excess cash flow account will be disbursed to the Borrower upon the expiration of any Cash Trap Event Period provided that such funds are used for, among other things, preapproved capital expenditures, preapproved leasing expenses, operating expenses, and approved extraordinary expenses (other than material tenant sweep funds, which will be disbursed to the Borrower for reimbursement of permitted leasing expenses in accordance with the 120 Wall Street Whole Loan documents). Upon an event of default under the 120 Wall Street Whole Loan documents, the lender may apply funds to the debt in such priority as it may determine.

 

A “Cash Trap Event Period” will commence upon the earlier to occur of (i) an event of default, (ii) the debt yield being less than 6.25% (as calculated in the 120 Wall Street Whole Loan documents) as of any Calculation Date (as defined below) and (iii) Droga5, LLC failing to renew or extend its lease by June 30, 2028.

 

A Cash Trap Event Period may be cured upon, with respect to a Cash Trap Event Period caused solely by (a) clause (i) above, the cure (if applicable) of the related event of default, (b) clause (ii) above, the earliest to occur of the date on which (A) the debt yield is at least 6.25% for two consecutive Calculation Dates or (B) the Borrower delivers a letter of credit reasonably satisfactory to the lender in an amount sufficient such that the debt yield would not be less than 6.25%, (c) clause (iii) above, the Borrower having deposited with the lender an amount equal to $50.00 per square foot of leased space under Droga5’s lease.

 

A “Calculation Date” means the last day of each calendar quarter during the 120 Wall Street Whole Loan term.

 

Future Mezzanine or Subordinate Indebtedness Permitted. The holder of 100% of the indirect equity interests in the Borrower is permitted to obtain mezzanine financing secured by 100% of the indirect ownership interests in the Borrower so long as, among other things: (a) no event of default has occurred and is continuing, (b) the lender and such mezzanine lender have entered into an intercreditor agreement reasonably satisfactory to the lender, (c) the aggregate loan-to-value ratio (as calculated in the 120 Wall Street Whole Loan documents) is no greater than 57.9%, (d) the aggregate debt service coverage ratio (as calculated in the 120 Wall Street Whole Loan documents) is equal to or greater than 2.37x, (e) the aggregate debt yield (as calculated in the 120 Wall Street Whole Loan documents) is equal to or greater than 7.7%, (f) the maturity date of the mezzanine loan is not earlier than the maturity date of the 120 Wall Street Whole Loan and (g) the mezzanine lender is a qualified mezzanine lender (as defined in the 120 Wall Street Whole Loan documents).

 

Partial Release. None.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 33 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 34 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 35 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

 36 of 144  

 

 

Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

Mortgage Loan Information
Mortgage Loan Sellers(1):CREFI/GACC
Original Principal Balance(2):$70,000,000
Cut-off Date Principal Balance(2):$70,000,000
% of Pool by IPB:7.7%
Loan Purpose:Acquisition
Borrowers(3):MGM Grand PropCo, LLC, Mandalay
 PropCo, LLC
Sponsors(3):BREIT Operating Partnership L.P.,
 MGM Growth Properties Operating
 Partnership LP
Interest Rate:3.55800%
Note Date:2/14/2020
Anticipated Repayment Date(4):3/5/2030
Final Maturity Date(4):3/5/2032
Interest-only Period(4):120 months
Original Term(4):120 months
Original Amortization:None
Amortization Type(4):ARD-Interest Only
Call Protection(5):Grtr0.5%orYM(31),DeforGrtr0.5%or
 YM(82),O(7)
Lockbox / Cash Management:Hard / Springing
Additional Debt(2):Yes
Additional Debt Balance(2):$1,564,200,000 / $804,400,000 /
 $561,400,000
Additional Debt Type(2):Pari Passu / B Notes / C Notes
 

Property Information
Single Asset / Portfolio:Portfolio
Title:Fee
Property Type - Subtype:Hotel – Full Service
Net Rentable Area (Rooms)(6):9,748
Location:Las Vegas, NV
Year Built / Renovated(7):Various / N/A
Occupancy/ADR/RevPAR(6):87.5% / $197.27 / $172.60
Occupancy/ADR/RevPAR Date:6/30/2020

 

 

Number of Tenants: 

 

 

N/A 

2017 NOI:$605,037,208
2018 NOI:$617,369,266
2019 NOI:$520,080,353
TTM NOI (as of 6/2020)(3):$381,156,903
UW Occupancy/ADR/RevPAR:92.1% / $196.52 / $180.94
UW Revenues:$2,106,295,488
UW Expenses:$1,586,215,135
UW NOI(11):$520,080,353
UW NCF(11):$487,305,761
Appraised Value / Per Room(8)(11):$4,600,000,000 / $471,892
Appraisal Date:1/10/2020
  
  
  
  
 


Escrows and Reserves(9)
InitialMonthlyInitial Cap
Taxes:$0SpringingN/A
Insurance:$0SpringingN/A
FF&E Reserves:$0SpringingN/A
Other:$0$0N/A
    
    
    
 
Financial Information(11)
 Senior NotesWhole Loan
Cut-off Date Loan / Room(2):$167,645$307,755
Maturity Date Loan / Room(2):$167,645$307,755
Cut-off Date LTV(2)(8):35.5%65.2%
Maturity Date LTV(2)(8):35.5%65.2%
UW DSCR Master Lease Rent(3):4.95x2.70x
UW Debt Yield Master Lease Rent(3):17.9%9.7%
 


Sources and Uses
SourcesProceeds% of TotalUsesProceeds% of Total
Senior Notes$1,634,200,00035.4%Purchase Price$4,600,000,00099.6%
Junior Notes1,365,800,00029.6Closing Costs17,792,1630.4
Sponsor Equity(10)1,617,792,16335.0   
Total Sources$4,617,792,163100.0%Total Uses$4,617,792,163100.0%
(1)The MGM Grand & Mandalay Bay Whole Loan was co-originated by Citi Real Estate Funding Inc. (“CREFI”), Barclays Capital Real Estate Inc. (“BCREI”), Deutsche Bank AG, acting through its New York Branch (“DBNY”) and Société Générale Financial Corporation (“SGFC”). CREFI will be contributing Note A-13-4 with an outstanding principal balance of approximately $46,666,667 and GACC will be contributing Note A-15-4 with an outstanding principal balance of approximately $23,333,333 to the Benchmark 2020-B20 mortgage trust.

(2)The MGM Grand & Mandalay Bay Loan (as defined below) is part of the MGM Grand & Mandalay Bay Whole Loan (as defined below), which is comprised of (i) 30 pari passu senior promissory notes with an aggregate Cut-off Date balance of $1,634,200,000 (the “MGM Grand & Mandalay Bay Senior Notes,” and collectively, the “MGM Grand & Mandalay Bay Senior Loan”) and (ii) 24 promissory notes with an aggregate Cut-off Date balance of $1,365,800,000 consisting of multiple subordination levels, which are subordinate to the MGM Grand & Mandalay Bay Senior Notes (the “MGM Grand & Mandalay Bay Junior Notes”). The MGM Grand Property has an allocated mortgage loan amount (“ALA”) of $1,635,000,000 and the Mandalay Bay Property has an ALA equal to $1,365,000,000.

(3)On January 14, 2020, MGM Growth Properties Operating Partnership LP (“MGP OP”), an affiliate of BREIT Operating Partnership L.P. (“BREIT OP”) and certain other parties entered into an agreement to, among other things, form a joint venture (50.1% indirectly owned by MGP OP and 49.9% indirectly owned by BREIT OP) (the “Joint Venture”) to acquire the MGM Grand & Mandalay Bay Properties (as defined below) for a purchase price of $4.60 billion ($471,892 per room). Contemporaneously with the acquisition, the MGM Grand & Mandalay Bay Borrowers (as defined below), as landlord entered into a 30-year triple-net master/operating lease (the “MGM/Mandalay

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

Lease” or “Master Lease”) with two, 10-year renewal options with MGM Lessee II, LLC (“MGM Tenant”), a wholly owned subsidiary of MGM Resorts International (“MGM”). Financial and other information presented in this Term Sheet is presented on a “look through” basis, based on the rents and receipts of the MGM Grand & Mandalay Bay Properties. For so long as the MGM/Mandalay Lease is in effect, the MGM Grand & Mandalay Bay Borrowers will be entitled only to the rent due under the MGM/Mandalay Lease and not to the underlying rent and other income from the MGM Grand & Mandalay Bay Properties. The UW DSCR Master Lease Rent and UW Debt Yield Master Lease Rent presented in the chart above are based on the initial MGM/Mandalay Lease annual rent of $292,000,000. The UW EBITDAR Debt Yield and the UW NCF DSCR for the MGM Grand & Mandalay Bay A Notes (based on the UW EBITDAR of $520.1 million and UW NCF of $487.3 million) are 31.8% and 8.27x, respectively. On May 1, 2020, MGM Resorts International reported that, as a result of the temporary closure of its domestic properties (which includes the MGM Grand & Mandalay Bay Properties) following the outbreak of COVID-19, its domestic properties (which includes the MGM Grand & Mandalay Bay Properties) were effectively generating no revenue, there were high levels of room and convention cancellation through the third quarter of 2020, and that, following the re-opening of its domestic properties (which includes the MGM Grand & Mandalay Bay Properties), it expected weakened demand in light of consumer fears and general economic uncertainty, among other things. The June 2020 TTM financials reflect the suspension of operations at the MGM Grand & Mandalay Bay Properties from March 17, 2020 through the end of the first calendar quarter of 2020 (although operations at the MGM Grand Property remained suspended until June 4, 2020 and operations at The Shoppes at Mandalay Bay Place and the Mandalay Bay resort remained suspended through June 24, 2020 and June 30, 2020, respectively). The adjusted June 2020 TTM EBITDAR of $381.2 million takes into account an adjustment for a combined net extraordinary loss add-back of approximately $82.4 million during the June 2020 TTM period (primarily comprised of employee payroll expenses and corporate allocations and net of a combined extraordinary gain of approximately $0.7 million related to a reversal of certain accrued benefit expenses) related to the temporary closure of the MGM Grand & Mandalay Bay Properties following the outbreak of COVID-19. The lender underwriting is based on 2019 financials, which reflects a full year of uninterrupted operations at the MGM Grand & Mandalay Bay Properties. Please see the “Operating History and Underwritten Net Cash Flow” and “Historical Performance” tables herein, and the footnotes thereto, for more detailed underwritten cash flow information.

(4)The MGM Grand & Mandalay Bay Whole Loan is structured with an Anticipated Repayment Date (“ARD”) of March 5, 2030 and a final maturity date of March 5, 2032. After the ARD, the following structure will apply: (i) the interest rate will increase by 200 basis points over the greater of (x) 3.55800%, and (y) (1) the ARD Treasury Note Rate (as defined below) in effect on the ARD plus (2) 1.77000%, (ii) amounts in the Excess Cash Flow Reserve (as defined below) will be applied first to pay monthly additional interest amounts which, to the extent not paid (such amount not paid, together with accrued interest thereon at the Adjusted Interest Rate (as defined below), the “Accrued Interest”), will be deferred and added to the principal balance of the MGM Grand & Mandalay Bay Whole Loan, and (iii) a full cash flow sweep to the extent of remaining amounts in the Excess Cash Flow Reserve will be applied to the principal of the MGM Grand & Mandalay Bay Whole Loan. The metrics presented above are calculated based on the ARD.

(5)The lockout period will be at least 31 payment dates beginning with and including the first payment date of April 5, 2020. The MGM Grand & Mandalay Bay Borrowers have the option to defease the MGM Grand & Mandalay Bay Whole Loan, in whole or in part, after the earlier to occur of (i) two years after the closing date of the securitization that includes the last note to be securitized and (ii) February 14, 2023. The MGM Grand & Mandalay Bay Whole Loan may be prepaid in whole or in part at any time, subject to payment of the applicable yield maintenance premium if such prepayment occurs prior to September 5, 2029 (provided no yield maintenance will be due in connection with mandatory prepayments arising out of any casualty, condemnation or in connection with a Special Release or a Default Release (as defined in the Preliminary Prospectus)). The assumed lockout period of 31 payment dates is based on the expected Benchmark 2020–B20 securitization closing date in October 2020. The actual lockout period may be longer.

(6)Net Rentable Area (Rooms) and Occupancy/ADR/RevPAR are based solely on the hotel at the MGM Grand & Mandalay Bay Properties. As of the trailing 12 months ending June 30, 2020, approximately 29.5% of revenues were generated by rooms, 19.7% of revenues were from gaming, 28.4% from food & beverage and 22.4% from other sources.

(7)The MGM Grand Property (as defined below) was built in 1993 and the Mandalay Bay Property (as defined below) was built in 1999. The MGM Grand Property has benefited from capital investment of approximately $480.0 million (approximately $96,000 per room) since 2010, $144.0 million of which was spent on a full rooms’ renovation from 2010 to 2013. Additionally, approximately $118.9 million was recently spent on an expansion and renovation of the convention center completed in December 2018, which is expected to expand the group business at the MGM Grand Property. The Mandalay Bay Property (including the Delano) underwent a substantial rooms’ renovation for approximately $159.7 million from 2012 to 2016 and, inclusive of the Four Seasons, has received a total of approximately $510.6 million (approximately $107,500 per room) of capital investment since 2010.

(8)The Appraised Value of $4,600,000,000 as of January 10, 2020, set forth above is the appraised value solely with respect to real property at the MGM Grand & Mandalay Bay Properties, excluding personal property and intangible property attributable to the MGM Grand & Mandalay Bay Properties (the “Aggregate Real Property Appraised Value”). The appraisal also includes an (“As Leased-Sale-Leaseback Appraised Value,”), which is equal to the Aggregate Real Property Appraised Value. The appraised value of $7,352,600,000 (“Aggregate As-Is Appraised Value”) as of January 10, 2020, includes personal property and intangible property attributable to the MGM Grand & Mandalay Bay Properties. The personal property and intangible property relating to the MGM Grand & Mandalay Bay Properties is owned by the MGM Tenant or certain sublessees at the MGM Grand & Mandalay Bay Properties that are wholly owned subsidiaries of MGM (the “MGM/Mandalay Operating Subtenants”) (as more particularly provided in the Master Lease), which granted a security interest in certain property of the MGM Tenant and the MGM/Mandalay Operating Subtenants (with certain exclusions, including an exclusion for the intellectual property of MGM Tenant as more particularly described in the Master Lease); and provided that the FF&E is only transferred to the MGM Grand & Mandalay Bay Borrowers at no cost in the event of a termination of the Master Lease due to an event of default by the MGM Tenant thereunder) in favor of the MGM Grand & Mandalay Bay Borrowers, and such security interest was collaterally assigned by the MGM Grand & Mandalay Bay Borrowers to the mortgage lender. The Cut-off Date LTV and Maturity Date LTV based on the Aggregate As-Is Appraised Value are 22.2% and 22.2%, respectively, based on the MGM Grand & Mandalay Bay Senior Loan. The Cut-off Date LTV and Maturity Date LTV based on the Aggregate As-Is Appraised Value are 40.8% and 40.8%, respectively, based on the MGM Grand & Mandalay Bay Whole Loan.

(9)For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below.

(10)Includes MGM’s approximately $80.0 million of retained equity interest in the MGM Grand & Mandalay Bay Properties after the sale-leaseback, by virtue of operating partnership units in MGP OP issued to MGM on the origination date of the MGM Grand & Mandalay Bay Whole Loan.

(11)All NOI, NCF and occupancy information, as well as the appraised value, were determined prior to the emergence of the novel coronavirus pandemic, and the economic disruption resulting from measures to combat the pandemic, and all DSCR, LTV and Debt Yield metrics were calculated, and the MGM Grand & Mandalay Bay Whole loan was underwritten, based on such prior information See “Risk Factors—Risks Related to Market Conditions and Other External Factors—Coronavirus Pandemic Has Adversely Affected the Global Economy and Will Likely Adversely Affect the Performance of the Mortgage Loans” in the Preliminary Prospectus.

  

The Loan. The MGM Grand & Mandalay Bay mortgage loan (the “MGM Grand & Mandalay Bay Loan”) is part of a fixed rate whole loan secured by the borrowers’ fee simple interest in two full service luxury resort and casinos located in Las Vegas, Nevada (the “MGM Grand Property,” and the “Mandalay Bay Property,” and collectively “The MGM Grand & Mandalay Bay Properties”). The MGM Grand & Mandalay Bay Loan is evidenced by the non-controlling Notes A-13-4 and A-15-4 with an outstanding principal balance as of the Cut-off Date of $70.0 million. The MGM Grand & Mandalay Bay Loan is part of a $3.00 billion whole loan (the MGM Grand & Mandalay Bay Whole Loan”) that is evidenced by (i) 30 MGM Grand & Mandalay Bay Senior Notes with an aggregate principal balance of $1,634,200,000 and (ii) the MGM Grand & Mandalay Bay Junior Notes comprised of 24 notes of multiple subordination levels, which are subordinate to the MGM Grand & Mandalay Bay Senior Loan with an aggregate principal balance of $1,365,800,000. Only the MGM Grand & Mandalay Bay Loan will be included

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

in the mortgage pool for the Benchmark 2020-B20 mortgage trust. The relationship between the holders of the MGM Grand & Mandalay Bay Whole Loan is governed by a co-lender agreement as described under “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced AB Whole Loans—The MGM Grand & Mandalay Bay Pari Passu-AB Whole Loan” in the Preliminary Prospectus. The MGM Grand & Mandalay Bay Whole Loan has a 10-year interest-only term. The MGM Grand & Mandalay Bay Whole Loan will be serviced pursuant to the trust and servicing agreement for the BX 2020-VIVA transaction. 

 

The MGM Grand & Mandalay Bay Whole Loan has a 10-year interest-only term through the ARD of March 5, 2030. After the ARD, through and including March 5, 2032 (the “Maturity Date”), the following structure would apply: (i) the interest rate will increase by 200 basis points over the greater of (x) 3.55800%, and (y)(1) the ARD Treasury Note Rate in effect on the ARD (such new rate, the “Adjusted Interest Rate”) plus (2) 1.77000%, (ii) amounts in the Excess Cash Flow Reserve (as defined below) will be applied first to pay monthly additional interest amounts which, to the extent not paid, will be deferred (together with interest accrued thereon at the Adjusted Interest Rate) and added to the principal balance of the MGM Grand & Mandalay Bay Whole Loan, and (iii) a full cash flow sweep to the extent of remaining amounts in the Excess Cash Flow Reserve will be applied to principal of the MGM Grand & Mandalay Bay Whole Loan. For the period from the origination date through the ARD, the MGM Grand & Mandalay Bay Senior Notes and Junior Notes accrue at the rate of 3.55800% per annum. The MGM Grand & Mandalay Bay Whole Loan proceeds along with loan sponsor equity were used to purchase the MGM Grand & Mandalay Bay Properties for $4.6 billion.

  

ARD Treasury Note Rate” means the rate of interest per annum calculated by the linear interpolation of the yields, as reported in Federal Reserve Statistical Release H.15 Selected Interest Rates under the heading “U.S. Government Securities/Treasury Constant Maturities” for the business day ending immediately prior to the ARD, of “U.S. Government Securities/Treasury Constant Maturities” with maturity dates (one longer and one shorter) most nearly approximating the Maturity Date. In the event Federal Reserve Statistical Release H.15 Selected Interest Rates is no longer published or in the event Federal Reserve Statistical Release H.15 Selected Interest Rates no longer publishes “U.S. Government Securities/Treasury Constant Maturities”, the mortgage lender will select a comparable publication to determine such “U.S. Government Securities/Treasury Constant Maturities” and the applicable ARD Treasury Note Rate. The mortgage lender’s determination of the ARD Treasury Note Rate will be final absent manifest error.

  

Whole Loan Summary
NoteOriginal BalanceCut-off Date BalanceNote HolderControlling Piece
A-13-4, A-15-4$70,000,000$70,000,000Benchmark 2020-B20(1)No
A-13-2, A-15-3$80,000,000$80,000,000Benchmark 2020-B19No
A-13-1, A-15-1$65,000,000$65,000,000Benchmark 2020-B18No
A-15-2$50,000,000$50,000,000DBJPM 2020-C9No
A-1, A-2, A-3, A-4$670,139$670,139BX 2020-VIVANo
A-5, A-6, A-7, A-8$794,861$794,861BX 2020-VIV2No
A-9, A-10, A-11, A-12$1,000,000$1,000,000BX 2020-VIV3No
A-14-1, A-16-1$69,500,000$69,500,000BBCMS 2020-C8No
A-13-3, A-13-5$509,360,667$509,360,667CREFI(2)No
A-14-2, A-14-3, A-14-4$281,347,000$281,347,000Barclays Bank PLC(2)No
A-15-5, A-15-6$204,680,333$204,680,333DBRI(2)No
A-16-2, A-16-3$301,347,000$301,347,000SGFC(2)No
Total Senior Notes$1,634,200,000$1,634,200,000  
B-1-A, B-2-A, B-3-A, B-4-A, B-1-B, B-2-B, B-3-B, B-4-B(4)$329,861$329,861BX 2020-VIVANo
B-5-A, B-6-A, B-7-A, B-8-A, B-5-B, B-6-B, B-7-B, B-8-B(4)$374,355,139$374,355,139BX 2020-VIV2No
B-9-A, B-10-A, B-11-A, B-12-A(4)$429,715,000$429,715,000BX 2020-VIV3No
C-1, C-2, C-3, C-4(4)$561,400,000$561,400,000BX 2020-VIVAYes(3)
Whole Loan$3,000,000,000$3,000,000,000 
(1)CREFI will be contributing Note A-13-4, which has an outstanding principal balance of approximately $46,666,667 to the Benchmark 2020-B20 mortgage trust. GACC will be contributing Note A-15-4, which has an outstanding principal balance of approximately $23,333,333 to the Benchmark 2020-B20 mortgage trust.

(2)Expected to be contributed to one or more future securitization transactions.

(3)The initial controlling note is Note C-1, so long as no related control appraisal period with respect to Note C-1 so long as no related control appraisal period with respect to Note C-1 and the related pari passu C notes has occurred and is continuing. If and for so long as a control appraisal period has occurred and is continuing, then the controlling note will be as described under “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced AB Whole Loans—The MGM Grand & Mandalay Bay Pari Passu-AB Whole Loan” in the Preliminary Prospectus.

(4)The MGM Grand & Mandalay Bay Junior Notes are subordinate to the MGM Grand & Mandalay Bay Senior Notes.

  

The Borrowers. On January 14, 2020, MGM Growth Properties Operating Partnership LP, an affiliate of BREIT Operating Partnership L.P. (the “Sponsors”, more particularly referred to as the “Loan Sponsors”), and certain other parties entered into an agreement to, among other things, form a joint venture (50.1% indirectly owned by MGP OP and 49.9% indirectly owned by BREIT OP) to acquire the MGM

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

Grand & Mandalay Bay Properties in Las Vegas for a purchase price of $4.60 billion ($471,892 per room). The borrowers under the MGM Grand & Mandalay Bay Whole Loan are MGM Grand PropCo, LLC and Mandalay PropCo, LLC (individually, a “MGM Grand & Mandalay Bay Borrower” and, collectively, the “MGM Grand & Mandalay Bay Borrowers” or the “Borrowers”), which are subsidiaries of the Joint Venture. The MGM Grand & Mandalay Bay Borrowers are Delaware limited liability companies and single purpose entities with two independent directors. Blackstone Real Estate Income Trust, Inc. (“BREIT”) is a non-traded real estate investment trust focused on investing in commercial real estate properties diversified by sector with an emphasis on providing investors with access to Blackstone’s institutional real estate investment platform. BREIT seeks to directly own stabilized income-generating United States commercial real estate across the key property types, including multifamily, industrial, retail, hotel, healthcare and office. BREIT is managed by an external advisor, BX REIT Advisors L.L.C., which is an affiliate of The Blackstone Group Inc. (“Blackstone”). Blackstone’s real estate investor capital under management totals approximately $161.0 billion as of March 31, 2020 and includes prime assets such as the Bellagio, Cosmopolitan Las Vegas, Hotel Del Coronado, Grand Wailea, Arizona Biltmore, Ritz Carlton Kapalua, and Turtle Bay Resort.

  

MGM Growth Properties LLC (“MGP”) is one of the leading publicly traded real estate investment trusts engaged in the acquisition, ownership and leasing of large-scale destination entertainment and leisure resorts. MGP currently owns a portfolio of properties, consisting of 12 premier destination resorts in Las Vegas and elsewhere across the United States, with over 27,400 rooms, as well as MGM Northfield Park in Northfield, OH, Empire Resort Casino in Yonkers, NY, and a retail and entertainment district, The Park, in Las Vegas.

  

MGP OP and BREIT OP (together, individually or collectively as the context may require, the “Guarantor”), are the non-recourse carveout guarantors on a several basis in proportion to each Guarantor’s Liability Percentage (as defined below). The Liability Percentage of each Guarantor will be automatically increased or decreased from time to time, as applicable, to the extent any direct and/or indirect equity interest in the Borrowers is transferred by one Guarantor (or its affiliates) to the other Guarantor (or its affiliates) with the transferring Guarantor’s Liability Percentage increasing by the amount of such transferred interests and the transferee Guarantor’s Liability Percentage decreasing by such amount. In no event will the Liability Percentage of the Guarantors in the aggregate be less than or greater than one hundred percent (100%). For the avoidance of doubt, transfers by a Guarantor (or its affiliates) to a third party that is not an affiliate of the other Guarantor will not result in an adjustment to the Liability Percentage of either Guarantor. For illustrative purposes, if BREIT OP transfers a twenty-five percent (25%) indirect equity interest in Borrower to a third party that is not an Affiliate of MGP OP and subsequently transfers a ten percent (10%) indirect equity interest in Borrower to MGP OP, the adjustments required to be made as a result of such transfers will be: (i) a decrease of ten percentage points to BREIT OP's Liability Percentage and (ii) an increase of 10 percentage points to MGP OP's Liability Percentage.

 

The Guarantor’s liability for full recourse events is capped at an amount equal to 10% of the aggregate outstanding principal balance of the MGM Grand & Mandalay Bay Whole Loan as of the date of the event. In addition, only the Borrowers are liable for breaches of environmental covenants; provided, however, that if the Borrowers fail to maintain an environmental insurance policy required under the MGM Grand & Mandalay Bay Whole Loan documents, the Guarantor is liable for losses other than (x) for any amounts in excess of the applicable coverage amounts under the environmental policy had the same been renewed, replaced or extended as required under the loan agreement and (y) for any amounts recovered under the environmental policy. In addition, recourse for transfers of the MGM Grand & Mandalay Bay Properties or controlling equity interests in the MGM Grand & Mandalay Bay Borrowers is loss recourse, rather than full recourse.

  

Liability Percentage” means, initially, (x) with respect to BREIT OP, 49.9% and (y) with respect to MGP OP, 50.1%.

   

The Properties.

  

MGM Grand (54.5% of Mortgage ALA and Master Lease Rent)

  

Built in 1993, the MGM Grand Property is a full-service luxury resort and casino property located on the Las Vegas Strip, situated between Tropicana Boulevard and Harmon Avenue. According to World Atlas, the MGM Grand Property is the third largest hotel in the world by room count. The MGM Grand Property is also a recipient of the AAA Four Diamond award. The MGM Grand Property covers approximately 101.9 acres and consists of 4,998 hotel rooms: 4,270 standard rooms, 554 suites, 88 luxury suites, 51 SKYLOFTS suites (excluding one additional office unit), 30 mansion villas (Mediterranean-themed villas targeted for high-end gamblers, celebrities and casino-invited guests on the strip) (the “Mansion Villas”) and four entourage rooms associated with the Mansion Villas. The MGM Grand Property contains approximately 177,268 square feet of casino space, featuring 1,553 slot machines and 128 gaming tables, over 748,000 square feet of meeting space, 18 restaurants, an approximately 22,858 square foot spa, four swimming pools and approximately 41,800 square feet of rentable retail space (featuring 31 retailers). The MGM Grand Property is home to Cirque du Soleil’s “Kà”, an acrobatic theater production that has been in residence at the MGM Grand Property since October 2004. The MGM Grand Property also includes the David Copperfield Theatre, Hakkasan Nightclub and the MGM Grand Garden Arena, which has a seating capacity of over 16,000 and hosts premier concerts, award shows, sporting events including championship boxing, and other special events.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

Room sizes range from 346 square feet to 11,517 square feet and the MGM Grand Property offers one to four bedroom rooms. Standard room amenities include air conditioning, in-room dining service, minibar, telephone, hair dryer, in-room safe, and high-speed internet. SKYLOFTS at MGM Grand, a AAA Four-Diamond, Forbes Five Star hotel, occupies the top two floors of the main building. The hotel has 51 lofts ranging from 1,401 to 6,040 square feet per loft. SKYLOFTS is also a member of The Leading Hotels of the World. The Mansion at the MGM Grand Property contains 30 Mansion Villas ranging from 2,358 to 11,517 square feet per villa and $5,000 to $35,000 per night.

  

Since 2010, the MGM Grand Property has benefited from total capital investment of approximately $480.0 million (approximately $96,036 per room). Notable capital expenditures from this time period include an approximately $144.0 million full rooms renovation from 2010 to 2013 and a recent $118.9 million expansion and renovation of the conference center, which was completed in December 2018.

 

Mandalay Bay (45.5% of Mortgage ALA and Master Lease Rent)

 

Built in 1999, the Mandalay Bay Property is a full-service luxury resort and casino property located as the first major resort on the strip to greet visitors arriving by automobile from Southern California. The AAA Four Diamond award winning resort is a premier conference hotel in Las Vegas with approximately 2.2 million square feet of convention, ballroom and meeting space, making it the fifth single largest event space in the United States. The Mandalay Bay Property is immediately across Interstate 15 from Allegiant Stadium, the new home stadium of the National Football League’s (“NFL”) Raiders, which was substantially completed on July 31, 2020 and began being utilized in September 2020. The Mandalay Bay Property covers approximately 124.1 acres and consists of 4,750 hotel rooms. Also included within the Mandalay Bay Property are: (i) the Delano, which is an all-suite hotel tower within the complex and (ii) a Four Seasons hotel, each of which has its own lobby, restaurants and pool and spa. In addition to the significant meeting space, the Mandalay Bay Property contains approximately 152,159 square feet of casino space, featuring approximately 1,232 slot machines and 71 gaming tables, 27 total restaurants, an approximately 30,000 square foot spa, ten swimming pools and approximately 54,000 square feet of rentable retail space featuring 41 retailers. The Mandalay Bay Property is also the home to Cirque du Soleil’s Michael Jackson “ONE”, which has been in residence at the Mandalay Bay Property in an approximately 1,805-seat showroom since 2013, an approximately 12,000-seat special events arena, the House of Blues (which features an arena seating up to 2,500 people) and the Shark Reef Aquarium. Additionally, the Mandalay Bay Property’s expansive pool and beach area plays host to an array of evening open air concerts during the pool season, a large wave pool, and Moorea, a European-style “ultra” beach and Daylight Beach Club.

  

Room sizes range from 400 to 5,605 square feet and the Mandalay Bay Property offers one- to four-bedroom rooms. Standard room amenities include air conditioning, in-room dining service, minibar, telephone, hair dryer, in-room safe, and high-speed internet. Floors 60–62 are designed as penthouse suites, with a penthouse lounge on level 62 for guests staying in the penthouses. Floors numbered 35–39 of the main hotel building are occupied by the five-star and AAA Four-Diamond Four Seasons Hotel Las Vegas. Located at the resort's 43-story second tower, the Delano Las Vegas is comprised of 45 rooms and 1,072 suites. Each suite at the Delano is at least 725 square feet.

  

The Mandalay Bay Property (including the Delano) underwent a substantial rooms’ renovation of approximately $159.7 million (approximately $35,150 per room) from 2012 to 2016 and has received a total of approximately $510.6 million (approximately $107,485 per room) of capital investment since 2010.

  

Cirque du Soleil performances at the MGM Grand & Mandalay Bay Properties have been suspended until further notice due to COVID-19.    On June 29, 2020, Cirque du Soleil Entertainment Group (“Cirque”) announced that it and certain of its affiliated companies filed for protection from creditors under the Companies’ Creditors Arrangement Act in order to restructure its capital structure, which application was granted by the court. On July 16, 2020, Cirque announced that it entered into a new “stalking horse” purchase agreement with a group of existing first lien and second lien secured lenders pursuant to which such lenders would acquire substantially all of Cirque’s assets in settlement of Cirque’s first and second lien debt. Such purchase agreement was approved by the court on July 17, 2020, and served as the new “stalking horse” bid in a SISP supervised by the court and the court-appointed monitor. As of August 18, 2020, it was reported that the lenders’ bid was the highest bid, which requires court approval to take effect.

 

Revenue Streams. The MGM Grand & Mandalay Bay Properties benefit from a diverse set of revenue streams with a substantial contribution from non-gaming sources (only 18.0% of combined year-end (“YE”) December 2019 revenues were derived from casinos) and offer nearly 2.8 million square feet of combined meeting and convention space.

 

As of YE December 2019, the MGM Grand Property generated 77.8% of net revenues from rooms, food and beverage, retail, entertainment and other operations. The gaming segment contributed 22.2% of net revenue (approximately $257.9 million), representing a decline from the 2018 level of 29.8% of net revenue (of approximately $365.7 million). A portion of the decline can be attributed to a renovation of the Mansion Villas in 2019, which serve as the MGM Grand Property’s main attractant to high-end gamblers. Nearly all

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

departments at the MGM Grand Property (including rooms, F&B, retail and entertainment) experienced continued growth in the YE December 2019 period despite the decline in casino revenue.

 

The Mandalay Bay Property has a much smaller casino department as a percentage of total net revenue (12.9% as of YE December 2019) than most casinos on the Las Vegas strip. The Mandalay Bay Property revenues are primarily driven by (i) the focus on group and convention business (according to the appraisal, the Mandalay Bay Property had a 2019 penetration factor of 134.8% for group business) and (ii) the fact that two of the three room types are operated as non-casino focused third party franchises (the Delano and Four Seasons). As of YE December 2019, 64.1% of total revenues at the Mandalay Bay Property were derived from rooms’ revenue (34.1%) and food & beverage revenue (30.0%).

  

As of YE December 2019, the MGM Grand Property achieved occupancy, ADR and RevPAR of 91.4%, $190.29 and $173.85, respectively. As of YE December 2019, the Mandalay Bay Property achieved occupancy, ADR and RevPAR of 92.8%, $202.98 and $188.40, respectively.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

Historical Performance
EBITDAR
($ Millions)(1)
20062007200820092010201120122013201420152016201720182019March
2020
TTM(1)
June
2020
TTM(1)
MGM Grand$329$396$271$214$163$149$181$236$255$281$332$345$372$283$263$220
Mandalay Bay$282$291$251$160$125$169$147$167$176$204$237$260$246$237$224$161
Total Collateral$611$688$522$374$288$318$327$403$431$485$569$605$617$520$487$381
Debt Yield(2)20.4%22.9%17.4%12.5%9.6%10.6%10.9%13.4%14.4%16.2%19.0%20.2%20.6%17.3%16.2%12.7%
Rent Coverage(3)2.1x2.4x1.8x1.3x1.0x1.1x1.1x1.4x1.5x1.7x1.9x2.1x2.1x1.8x1.7x1.3x

(1)On May 1, 2020, MGM Resorts International reported in its first quarter Form 10-Q filing that, as a result of the temporary closure of its domestic properties (which includes the MGM Grand & Mandalay Bay Properties) following the outbreak of COVID-19, its domestic properties (which includes the MGM Grand & Mandalay Bay Properties) were effectively generating no revenue, and there were high levels of room and convention cancellation through the third quarter of 2020. The March 2020 TTM financials presented above reflect the suspension of operations at the MGM Grand & Mandalay Bay Properties from March 17, 2020 through the end of the first calendar quarter of 2020. On August 3, 2020, MGM reported in its second quarter Form 10-Q filing that, while throughout May, June and July 2020, it re-opened most of its properties with limited amenities and certain measures to mitigate the spread of COVID-19, such properties (which include the MGM Grand & Mandalay Bay Properties) may be subject to temporary, complete or partial shutdowns in the future, and that it has seen and expects to continue to see weakened demand in light of consumer fears and general economic uncertainty, among other things. The June 2020 TTM financials presented above reflect the operations at the MGM Grand Property, which remained suspended until June 4, 2020 and operations at The Shoppes at Mandalay Bay Place and the Mandalay Bay resort, which remained suspended through June 24, 2020 and June 30, 2020, respectively. The $487 million presented above represents the adjusted March 2020 TTM EBITDAR, which takes into account an adjustment for a combined net extraordinary loss of approximately $20.6 million during the March 2020 TTM period (reflecting primarily operating losses during closure comprised mainly of employee payroll expenses and corporate allocations and net of a combined extraordinary gain of approximately $0.7 million related to a reversal of certain accrued benefit expenses) related to the temporary closure of the MGM Grand

& Mandalay Bay Properties following the outbreak of COVID-19. The $381 million presented above represents the adjusted June 2020 TTM EBITDAR, which takes into account an adjustment for a combined net extraordinary loss of approximately $82.4 million during the June 2020 TTM period (reflecting primarily operating losses during closure comprised mainly of employee payroll expenses and corporate allocations and net of a combined extraordinary gain of approximately $0.7 million related to a reversal of certain accrued benefit expenses) related to the temporary closure of the MGM Grand & Mandalay Bay Properties following the outbreak of COVID-19. The lender underwriting presented above is based on 2019 financials, which reflects a full year of uninterrupted operations at the MGM Grand & Mandalay Bay Properties. Please see “Operating History and Underwritten Net Cash Flow” herein, and the footnotes thereto, for more detailed underwritten cash flow information. 

(2)Debt Yield metrics presented above are based on the MGM Grand & Mandalay Bay Whole Loan Cut-off Date balance of $3.0 billion and the EBITDAR of each respective time period.

(3)Rent Coverage ratios presented above are based on the initial Master Lease Rent of $292.0 million and the EBITDAR of each respective time period.

 

Historical Performance  – MGM Grand (1)
               MarchJune
               20202020
 20062007200820092010201120122013201420152016201720182019TTM(2)TTM(2)
RevPAR$154$162$145$112$112$128$136$138$151$155$162$167$169$174$172$161
Net Revenue ($bns)$1.19$1.32$1.22$1.09$1.03$1.05$1.07$1.15$1.21$1.16$1.15$1.18$1.23$1.16$1.10$0.87
EBITDAR Margin28%30%22%20%16%14%17%21%21%24%29%29%30%24%24%25%

(1)Any financial information contained in this Term Sheet for the MGM Grand Property which relates to any period prior to 2015 has not been recast to reflect the adoption of ASC 606 revenue recognition under GAAP and thus, any financial information provided for periods prior to 2015 may not be comparable to periods on or after 2015 with respect to which recasting has been applied.

(2)The March 2020 TTM financials presented above reflect the suspension of operations at the MGM Grand & Mandalay Bay Properties from March 17, 2020 through the end of the first calendar quarter of 2020. On August 3, 2020, MGM reported in its second quarter Form 10-Q filing that, while throughout May, June and July 2020, it re-opened most of its properties with limited amenities and certain measures to mitigate the spread of COVID-19, such properties (which include the MGM Grand and Mandalay Bay Properties) may be subject to temporary, complete or partial shutdowns in the future, and that it has seen and expects to continue to see weakened demand in light of consumer fears and general economic uncertainty, among other things. The June 2020 TTM financials presented above reflect the operations at the MGM Grand Property, which remained suspended until June 4, 2020 and operations at The Shoppes at Mandalay Bay Place and the Mandalay Bay resort, which remained suspended through June 24, 2020 and June 30, 2020, respectively. The lender underwriting presented above is based on 2019 financials, which reflects a full-year of uninterrupted operations at the MGM Grand & Mandalay Bay Properties.

 

Historical Performance – Mandalay Bay(1)
              MarchJune
              20202020
 20062007200820092010201120122013201420152016201720182019TTM(2)TTM(2)
RevPAR$199$213$193$142$142$160$162$164$176$177$185$186$184$188$188$186
Net Revenue ($ bns)$0.99$1.02$0.95$0.79$0.78$0.84$0.78$0.86$0.95$0.94$0.97$0.98$0.97$0.94$0.90$0.67
EBITDAR Margin29%28%26%20%16%20%19%19%19%22%24%27%25%25%25%24%
(1)Any financial information contained in this Term Sheet for the Mandalay Bay Property which relates to any period prior to 2015 has not been recast to reflect the adoption of ASC 606 revenue recognition under GAAP and thus, any financial information provided for periods prior to 2015 may not be comparable to periods on or after 2015 with respect to which recasting has been applied.

(2)The March 2020 TTM financials presented above reflect the suspension of operations at the Properties from March 17, 2020 through the end of the first calendar quarter of 2020. On August 3, 2020, MGM reported in its second quarter Form 10-Q filing that, while throughout May, June and July 2020, it re-opened most of its properties with limited amenities and certain measures to mitigate the spread of COVID-19, such properties (which include the MGM Grand and Mandalay Bay Properties) may be subject to temporary, complete or partial shutdowns in the future, and that it has seen and expects to continue to see weakened demand in light of consumer fears and general economic uncertainty, among other things. The June 2020 TTM financials presented above reflect the operations at the MGM Grand Property, which remained suspended until June 4, 2020 and operations at The Shoppes at Mandalay Bay Place and the Mandalay Bay resort, which remained suspended through June 24, 2020 and June 30, 2020, respectively. The lender underwriting presented above is based on 2019 financials, which reflects a full-year of uninterrupted operations at the MGM Grand & Mandalay Bay Properties.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

Master Lease. The MGM Grand & Mandalay Bay Properties are master leased to MGM Lessee II, LLC (“MGM Tenant”), a wholly-owned subsidiary of MGM under a 30-year, triple-net master and operating lease with two, ten-year renewal options. In turn, the MGM Tenant has subleased a portion of the MGM Grand & Mandalay Bay Properties to each of MGM Grand Hotel, LLC, a Nevada limited liability company (“Grand Operating Subtenant”), Mandalay Bay, LLC, a Nevada limited liability company (“Mandalay Bay Subtenant”) and Mandalay Place, LLC, a Nevada limited liability company (“Mandalay Place Subtenant”; and, together with Grand Operating Subtenant and Mandalay Bay Subtenant, individually or collectively as the context may require, together with any person to whom all or any portion of a Property is sublet by MGM Tenant pursuant to a MGM/Mandalay Operating sublease pursuant to the express terms and conditions of the MGM/Mandalay Lease, each a “MGM/Mandalay Operating Subtenant”). Each MGM/Mandalay Operating Subtenant executed a joinder to the MGM/Mandalay Lease for the purpose of (x) agreeing to be bound by the terms and provisions of the MGM/Mandalay Lease regarding the disposition of any portion of the MGM Tenant’s Property owned by such MGM/Mandalay Operating Subtenant and (y) granting a security interest to the Borrowers in the portion of the MGM Tenant’s pledged property owned by such MGM/Mandalay Operating Subtenant and certain reserve funds under the MGM/Mandalay Lease. The MGM Tenant and each MGM/Mandalay Operating Subtenant is not a borrower or an obligor under the MGM Grand & Mandalay Bay Loan documents.

  

Under the Master Lease, the MGM Tenant is required to pay to the Borrowers an initial lease rent of $292.0 million per annum ($159.0 million allocated to the MGM Grand Property and $133.0 million allocated to the Mandalay Bay Property, the “Master Lease Rent”), subject to annual increases of (i) 2.0% in years 2 through 15 of the initial lease term, and (ii) thereafter, the greater of 2.0% or CPI (CPI capped at 3.0%) for the remainder of the initial lease term. Additionally, MGM will be required to continue to invest in the MGM Grand & Mandalay Bay Properties, with (x) a minimum aggregate capital investment requirement of 3.5% of actual net revenues every five years (the first such period beginning January 1, 2020 and expiring December 31, 2024, and the second such period beginning January 1, 2021 and expiring December 31, 2025, and each five-year period thereafter on a rolling basis) in the aggregate for the MGM Grand & Mandalay Bay Properties (such amount not to be less than 2.5% of the actual net revenue of any individual Property) (collectively, the “Required CapEx”) and (y) a monthly reserve equal to 1.5% of actual net revenues which may be used for FF&E and on qualifying capital expenditures in satisfaction of the Required CapEx spend. Upon early termination of the Master Lease due to an event of default by MGM Tenant thereunder, the FF&E will be transferred to the Borrowers at no cost.

  

Beginning with the first full calendar quarter after the origination date for the MGM Grand & Mandalay Bay Whole Loan and continuing thereafter, if either (a) (x) EBITDAR to Rent Ratio (as defined in the Master Lease) for the prior four fiscal quarters is less than 1.60x and (y) MGM’s market cap is less than $6.0 billion or (b) (x) MGM is no longer publicly traded and listed on NYSE, AMEX or NASDAQ and (y)    the EBITDAR to Rent Ratio for the prior four fiscal quarters is less than 2.0x, then the MGM Tenant will be required to provide one or more letters of credit or fund a cash escrow in an aggregate amount equal to the following year’s rent (taking into account the applicable escalations). Based on the adjusted June 2020 TTM EBITDAR of approximately $381.2 million and the initial Master Lease rent of $292.0 million, the MGM Grand & Mandalay Bay Whole Loan results in a June 2020 TTM EBITDAR-to-rent coverage ratio of 1.31x.

 

No intellectual property is licensed to the Borrowers and the Borrowers have no option to purchase upon expiration of the Master Lease. Upon the expiration of the Master Lease term or earlier termination of Master Lease, the MGM Tenant will be obligated to provide up to 18 months of transition services to permit the continuous and uninterrupted operation of the MGM Grand & Mandalay Bay Properties.

 

MGM (NYSE: MGM, rated Ba3/BB-/BB- by Moody’s, Fitch and S&P) guarantees to the Borrowers the payment and performance of all monetary obligations and certain other obligations of the MGM Tenant under the Master Lease. In addition to the lease guaranty, MGM (in such capacity, the “Shortfall Collection Guarantor”) has executed a shortfall guaranty for the benefit of the mortgage lenders for the MGM Grand & Mandalay Bay Loan, pursuant to which MGM has guaranteed to the mortgage lenders the unpaid portion of the initial principal amount of the MGM Grand & Mandalay Bay Loan (without giving effect to any future amendments that may increase the principal balance) and all interest accrued and unpaid thereon. For the avoidance of doubt, the Shortfall Collection Guarantor does not guarantee any Accrued Interest or any additional principal as a result of any unpaid Accrued Interest after the ARD. Transfers of interests in MGM are not restricted under the MGM Grand & Mandalay Bay Loan documents and any bankruptcy or other adverse event with respect to the Shortfall Collection Guarantor does not constitute a default under the MGM Grand & Mandalay Bay Loan documents. Neither MGM nor its affiliates (including, without limitation, MGM Tenant) are considered an affiliate of the Borrowers for any purpose under the MGM Grand & Mandalay Bay Loan documents so long as such person does not control the Borrowers. There is no continuing net worth requirement with respect to MGM in connection with the shortfall guaranty. As of the origination of the MGM Grand & Mandalay Bay Loan, neither MGM nor MGM Tenant controlled the Borrowers.

  

As of December 31, 2019, MGM had a market capitalization of approximately $16.7 billion, full-year 2019 revenue of approximately $12.9 billion and consolidated, adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) of approximately $3.0 billion. As of March 31, 2020, MGM reported revenue of approximately $2.3 billion for the first quarter of 2020. This represents a 29% decrease to the first quarter of 2019, which was primarily driven by MGM’s temporary suspension of its domestic and Macau casino operations related to the COVID-19 pandemic. MGM had $6.0 billion of cash and cash equivalents as of March 31, 2020, which included $1.8 billion

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

at MGP and $381 million at MGM China. In addition, on April 23, 2020, MGM commenced a private offering of $750 million in aggregate principal amount of 6.75% coupon senior notes due in 2025, which further added to MGM’s cash position. As of June 30, 2020, MGM reported (i) revenue of approximately $290.0 million for the second quarter of 2020 (of which approximately $151.0 million was derived from MGM’s Las Vegas Strip resorts(1)), (ii) a total consolidated liquidity position of $8.1 billion (which includes MGM Resorts, MGM China and MGP and is comprised of cash and cash equivalents of approximately $4.8 billion and approximately $3.3 billion available under certain revolving credit facilities) and (iii) a market capitalization of approximately $8.3 billion. According to MGM’s second quarter 2020 earnings presentation, the Adjusted Property EBITDAR margin across all reopened MGM properties on the Las Vegas Strip (during the period the properties were operating through June 30, 2020) increased by approximately 450 basis points compared to the second quarter of 2019 (calculation methodology presented below)(2).

  

The MGM Tenant is a casino owner-operator for 29 unique hotel offerings totaling over 44,000 rooms across Las Vegas, United States regional markets and Macau. The MGM Tenant has managed the MGM Grand Property and Mandalay Bay Property for more than 27 and 18 years, respectively.

 

(1)Second quarter 2020 revenue of approximately $151.0 million for MGM’s Las Vegas Strip resorts reflects revenue from certain resorts which reopened during the second quarter of 2020 with limited amenities and certain COVID-19 mitigation procedures: the Bellagio (reopened on June 4, 2020), the MGM Grand (reopened on June 4, 2020), New York, New York (reopened on June 4, 2020), Excalibur (reopened on June 11, 2020) and Luxor (reopened on June 25, 2020). The Mandalay Bay, ARIA, Vdara, Mirage and Park MGM resorts were not open during the second quarter of 2020.

(2)Second quarter 2020 Adjusted Property EBITDAR calculation methodology: Reflects MGM management's estimates of operating trends for the periods in which the properties were operating (commencing on each respective properties reopening date and calculated through June 30, 2020), compared to the same periods in 2019 using monthly property level financials and internally generated daily operating reports to calculate activity for partial monthly periods, based on the days in the second quarter of 2020 that such properties were opened prior to June 30, 2020, including activity for invitation only customer events prior to reopening to the general public.

 

COVID-19 Update. According to a press release issued on March 15, 2020, MGM announced that it would suspend operations at all of its Las Vegas properties, including the MGM Grand & Mandalay Bay Properties, until further notice, effective as of March 17, 2020, and that casino operations would close on March 16, 2020, followed by hotel operations on March 17, 2020. MGM cited COVID-19 as a pandemic that had intensified in the United States, requiring major collective action to slow its progression. MGM stated that it cancelled all reservations at its Las Vegas properties prior to May 21, 2020. MGM further reported that it incurred substantial operating losses in March 2020 and did not expect to see a material improvement until more is known regarding the duration and severity of the pandemic, including when MGM’s properties can reopen to the public. On May 1, 2020, MGM reported that as a result of the government-mandated closure, its domestic properties (which includes the MGM Grand & Mandalay Bay Properties and several properties which are not part of the collateral for the MGM Grand & Mandalay Bay Whole Loan) were effectively generating no revenue. In addition, MGM Resorts International reported high levels of room and convention cancellation across its domestic properties through the third quarter of 2020 with some tentative re-bookings in the fourth quarter and into 2021, and it indicated that when it is able to re-open its domestic properties, it expects weakened demand in light of continued domestic and international travel restrictions or warnings, consumer fears and reduced consumer discretionary spending and general economic uncertainty. As of June 4, 2020, the MGM Grand Property was reopened, with limited amenities and certain COVID-19 mitigation procedures. MGM reopened The Shoppes at Mandalay Bay Place on June 25, 2020 and the Mandalay Bay resort on July 1, 2020, both with limited amenities and certain COVID-19 mitigation procedures. On August 28, 2020, several news outlets reported that MGM is expected to lay off approximately 18,000 furloughed workers in the United States, more than one-quarter of its pre-COVID-19 pandemic U.S. workforce, due to the continued impact of the COVID-19 pandemic on MGM’s business. As of the date of the Preliminary Prospectus, the MGM Grand & Mandalay Bay Properties continue to operate subject to the restrictions described above. August and September debt service payments have been made on the MGM Grand & Mandalay Bay Whole Loan and no loan modification or forbearance requests have been made. Additionally, August and September master lease payments have been made and there have been no lease modification requests. See “Risk Factors—Risks Related to Market Conditions and Other External Factors—Current Coronavirus Pandemic May Adversely Affect the Global Economy and the Performance of the Mortgage Loans”.

  

The Market. The MGM Grand & Mandalay Bay Properties are located on the Las Vegas Strip in the heart of Las Vegas, Nevada. Visitor volume and airport passenger traffic into the Las Vegas region have more than doubled from 1990 to 2019. In connection with the financial downturn in 2008 and 2009, the Las Vegas market generally experienced a contraction. During 2010, the market began to rebound and visitation returned to near peak levels. McCarran International Airport welcomed 51.5 million passengers in 2019 (surpassing the 2018 passenger count of approximately 49.6 million).

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

Since 2010, annual convention attendance in Las Vegas has grown by over 2 million people (4.0% CAGR). With an estimated local population of 2.3 million people as of 2019, an additional approximately 42.5 million tourists visiting the metropolitan Las Vegas area annually and recent investment in Las Vegas by major sports leagues, the amount of existing gaming activity has increased steadily since the 2009 trough. In Clark County, gaming revenue has increased approximately 17.2% through 2019 since the gaming revenue trough in 2009.

  

Market Overview(1)

Category 

1990

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Visitor Volume (thousands)20,95436,35137,33538,92939,72739,66841,12742,31242,93642,21442,11742,524
YoY % ChangeNAP-3.0%2.7%4.3%2.1%-0.1%3.7%2.9%1.5%-1.7%-0.2%1.0%
Clark County Gaming Revenues ($mm)$4,104$8,838$8,909$9,223$9,400$9,674$9,554$9,618$9,714$9,979$10,250$10,355
YoY % ChangeNAP-9.8%0.8%3.5%1.9%2.9%-1.2%0.7%1.0%2.7%2.7%1.0%
Hotel / Motel Rooms Inventory73,730148,941148,935150,161150,481150,593150,544149,213149,339148,896149,158149,422
YoY % ChangeNAP6.0%0.0%0.8%0.2%0.1%0.0%-0.9%0.1%-0.3%0.2%0.2%
Airport Passenger Traffic (thousands)19,09040,46939,75741,48141,66841,85742,88545,31947,36848,43049,64551,538
YoY % ChangeNAP-8.2%-1.8%4.3%0.4%0.5%2.5%5.7%4.5%2.2%2.5%3.8%
Convention Attendance (thousands)1,7424,4924,4734,8654,9445,1075,1955,8916,3116,6466,5026,649
YoY % ChangeNAP-23.9%-0.4%8.8%1.6%3.3%1.7%13.4%7.1%5.3%-2.2%2.3%
(1)Source: Las Vegas Convention and Visitors Authority.

  

The Las Vegas Strip hotel average occupancy has been approximately 90% over the last three years. The Las Vegas Strip average 2019 occupancy was 90.4% and average 2018 occupancy was 89.5%. The Las Vegas Strip average 2019 ADR of $143.31 increased 3.3% relative to the average 2018 ADR of $138.71.

  

Historical Occupancy, ADR, RevPAR – Competitive Set
 MGM Grand Resort(1)Competitive Set(2)(3)MGM Grand Penetration Factor(2)
YearOccupancyADRRevPAROccupancyADRRevPAROccupancyADRRevPAR
December 31, 201792.1%$181.76$167.3692.0%$181.95$167.10100.2%100.0%100.3%
December 31, 201892.7%$182.10$168.7693.0%$187.63$173.66100.1%97.4%97.6%
December 31, 201991.4%$190.29$173.8594.0%$193.23$181.41  98.7%98.6%97.3%
          
(1)Source: Historical operating statements.

(2)Source: Appraisal.

(3)Includes: The Mirage, New York New York, Luxor, Caesars, Planet Hollywood, and Venetian/Palazzo.

 

Historical Occupancy, ADR, RevPAR – Competitive Set
 Mandalay Bay Resort(1)Competitive Set(2)(3)Mandalay Bay Penetration Factor(2)
YearOccupancyADRRevPAROccupancyADRRevPAROccupancyADRRevPAR
December 31, 201790.0%$206.28$185.5792.0%$177.98$164.0698.0%113.2%110.9%
December 31, 201890.2%$203.96$183.9693.0%$183.94$171.1397.4%109.2%106.4%
December 31, 201992.8%$202.98$188.4094.0%$190.09$178.1596.6%108.8%105.1%
           
(1)Source: Historical operating statements.

(2)Source: Appraisal.

(3)Includes: The Mirage, New York New York, Luxor, Caesars, Planet Hollywood, and Venetian/Palazzo.

 

Additional group business is expected to enter the market as a result of the delivery of Allegiant Stadium in August 2020 (across the street from the Mandalay Bay Property) which will serve as the home stadium for the Raiders NFL team. Non-gaming revenue in the Las Vegas market was approximately 65% of total revenue in 2019 compared to pre-recession levels of approximately 59% in 2007. 

 

Each of the MGM Grand & Mandalay Bay Properties share the same competitive set. The primary competitive set for the MGM Grand & Mandalay Bay Properties consists of six hotels, which range in size from 2,024 to 7,117 rooms and collectively contain an aggregate 23,058 rooms. According to the appraisal, there are two mega resorts in the construction phase with planned delivery between 2021 and 2022. Resorts World Las Vegas is a 59-story Chinese-themed mega resort under construction at the former Stardust Resort and Casino site on the northern Las Vegas Strip with scheduled delivery by summer of 2021 according to the appraisal. The Drew is a 735-foot tall, 75% completed mega casino resort scheduled to be delivered by 2022.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

Comparable Properties(1)

Property Name

No. of Rooms

Year Opened

Meeting Space 

(sq. ft.)

Casino Space

(sq. ft.)

Estimated

2019 Occ.

Estimated

2019 ADR

Estimated 

2019 RevPAR

MGM Grand(2)4,9981993748,325177,26891.4%$190.29$173.85
Mandalay Bay(2)4,75019992,100,000152,15992.8%$202.98$188.40
The Mirage3,0441989170,00094,00094.6%$178.00$168.39
New York New York2,024199730,50081,00095.5%$151.00$144.21
Luxor4,397199320,000120,00095.0%$119.00$113.05
Caesar’s Palace3,9761966300,000124,20093.0%$221.00$205.53
Planet Hollywood2,500200020,00064,50090.0%$185.00$166.50
Venetian/Palazzo7,1171999450,000335,87894.6%$237.00$224.20
(1)Source: Appraisal, unless otherwise indicated.

(2)Source: Underwriting and Loan Sponsor provided information.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

Operating History and Underwritten Net Cash Flow(1)
 20152016201720182019TTM(2)UnderwrittenPer Room% of Total Revenue(3)
Occupancy92.5%92.4%91.0%91.5%92.1%87.5%92.1%  
ADR$179.08$187.27$193.58$192.62$196.52$197.27$196.52  
RevPAR$165.56$172.97$176.24$176.18$180.94$172.60$180.94  
Hotel Revenue$576,193,751$611,611,719$621,671,255$619,356,266$635,408,160$454,847,334$635,408,160$65,18330.2%
Casino Revenue461,726,103438,253,825459,676,698492,001,712379,532,959304,523,632379,532,959$38,93418.0%
F&B Revenue578,021,518598,992,505608,876,978604,859,218629,566,379438,092,332629,566,379$64,58429.9%
Other Revenue480,778,051465,818,022471,735,234475,323,334461,787,990345,071,444461,787,990(4)$47,37321.9%
Total Revenue$2,096,719,423$2,114,676,071$2,161,960,165$2,191,540,530$2,106,295,488$1,542,534,742$2,106,295,488$216,075100.0%
Hotel Expense230,915,708235,477,994249,304,637255,303,612265,201,312205,510,281265,201,312$27,20641.7%
Casino  Expense253,918,628213,245,938229,109,011226,996,812223,320,361189,641,029223,320,361$22,90958.8%
F&B Expense428,952,166429,128,035433,970,578437,033,184449,487,794329,402,047449,487,794$46,11171.4%
Other  Expense349,547,741323,328,025322,504,168316,078,620304,747,043225,847,118304,747,043$31,26366.0%
Total Departmental$1,263,334,243$1,201,179,992$1,234,888,394$1,235,412,228$1,242,756,510$950,400,475$1,242,756,510$127,48859.0%
Gross Operating Income$833,385,180$913,496,079$927,071,771$956,128,302$863,538,978$592,134,267$863,538,978$88,58641.0%
Total Undistributed Expenses278,305,919261,847,999247,318,999257,487,307258,119,417215,257,835258,119,417$26,47912.3%
Gross Operating Profit$555,079,261$651,648,080$679,752,772$698,640,995$605,419,561$376,876,432$605,419,561$62,10728.7%
Management  Fee46,463,95959,835,05653,171,10456,764,25857,698,01348,582,05157,698,013$5,9192.7%
Taxes16,605,85316,929,58415,852,62217,309,47818,451,93119,072,78718,451,931$1,8930.9%
Insurance6,711,4716,110,0265,691,8387,197,9939,189,26410,442,1219,189,264$9430.4%
Net Extraordinary Loss Add-back0000082,377,4300$00.0%
Total Operating Expenses$1,611,421,445$1,545,902,657$1,556,922,957$1,574,171,264$1,586,215,135$1,161,377,839$1,586,215,135$162,72275.3%
EBITDAR$485,297,978$568,773,414$605,037,208$617,369,266$520,080,353$381,156,903(6)$520,080,353$53,35324.7%
Capital Expenditures(5)00000032,774,592$3,3621.6%
Net Cash Flow$485,297,978$568,773,414$605,037,208$617,369,266$520,080,353$381,156,903(6)$487,305,761$49,99023.1%

(1)Certain items such as interest expense, interest income, depreciation, amortization, debt service payments and any other non-recurring or non-operating items were excluded from the historical presentation and are not considered for the underwritten cash flow.

(2)TTM column represents the trailing 12-month period ending June 30, 2020.

(3)% of Total Revenue for Hotel Expense, Casino Expense, F&B Expense and Other Expenses are based on their corresponding aggregate revenue line item.

(4)The most recent available breakout of the Signature Condo-Hotel revenue as a component of Other Revenue was from the November 2019 trailing 12-month period.

(5)Underwritten Capital Expenditures is based on the 1.5% contractual FF&E reserve based on total net revenues (excluding net revenues associated with the Signature Condo-Hotel development at the MGM Grand Property for which FF&E is not reserved under the Master Lease). With respect to the Mandalay Bay Property, 5.0% FF&E Reserve was underwritten for the revenues associated with the closing date Four Seasons Management Agreement.

(6)The TTM financials presented above reflect the suspension of operations at the Properties from March 17, 2020 through the end of the first calendar quarter of 2020. On August 3, 2020, MGM reported in its second quarter Form 10-Q filing that, while throughout May, June and July 2020, it re-opened most of its properties with limited amenities and certain measures to mitigate the spread of COVID-19, such properties (which include the MGM Grand and Mandalay Bay Properties) may be subject to temporary, complete or partial shutdowns in the future, and that it has seen and expects to continue to see weakened demand in light of consumer fears and general economic uncertainty, among other things. The TTM June 2020 financials presented above reflect the operations at the MGM Grand Property, which remained suspended until June 4, 2020 and operations at The Shoppes at Mandalay Bay Place and the Mandalay Bay resort, which remained suspended through June 24, 2020 and June 30, 2020, respectively. The lender UW presented above is based on 2019 financials, which reflects a full-year of uninterrupted operations at the MGM Grand & Mandalay Bay Properties.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

Property Management. The MGM Grand & Mandalay Bay Properties are currently managed by the MGM Tenant and/or the applicable MGM/Mandalay Operating Subtenant, and there are no management agreements currently in effect with the Borrowers and, other than the management agreement with respect to the Four Seasons hotel and the management agreement with respect to certain signature hotel units (which, for the avoidance of doubt, are not part of the MGM Grand & Mandalay Bay Properties), for which management fees related thereto are included as part of the collateral, there are no management agreements currently in effect with respect to the MGM Grand & Mandalay Bay Properties.

  

Escrows and Reserves. At loan origination, the Borrowers were not required to deposit any upfront reserves.

 

Under the Master Lease, the MGM Tenant is obligated to make monthly deposits of 1.50% of net revenues at an eligible institution to be used for FF&E and qualifying capital expenditures (the “OpCo FF&E Reserve Account”). MGM Tenant granted the Borrowers a security interest in the OpCo FF&E Reserve Account, and the Borrowers collaterally assigned the Borrowers’ security interest in the OpCo FF&E Reserve Account to the mortgage lender.

  

Tax Reserve – For so long as the MGM Grand & Mandalay Bay Properties are subject to the Master Lease, no reserves for real estate taxes are required under the MGM Grand & Mandalay Bay Whole Loan documents. If the MGM Grand & Mandalay Bay Properties are not subject to the Master Lease, solely if a MGM Grand & Mandalay Bay Trigger Period is in effect, the MGM Grand & Mandalay Bay Whole Loan documents provide for ongoing monthly reserves for real estate taxes in an amount equal to 1/12 of the real estate taxes that the lender estimates will be payable during the next 12 months at least 30 days prior to their respective due dates. Notwithstanding the foregoing, the requirement for such monthly reserves will be reduced dollar for dollar by any taxes paid or reserved for by a brand manager or casino operator pursuant to a brand management or casino management agreement relating to the MGM Grand & Mandalay Bay Properties.

  

Insurance Reserve – For so long as the MGM Grand & Mandalay Bay Properties are subject to the Master Lease, no reserves for insurance premiums are required under the MGM Grand & Mandalay Bay Whole Loan documents. If the MGM Grand & Mandalay Bay Properties are not subject to the Master Lease, solely if a MGM Grand & Mandalay Bay Trigger Period is in effect, the MGM Grand & Mandalay Bay Whole Loan documents provide for ongoing monthly reserves for insurance premiums in an amount equal to 1/12 of the insurance premiums that the lender estimates will be payable for the renewal of the insurance policies at least 30 days prior to the expiration thereof. Notwithstanding the foregoing, the requirement for such monthly reserves will be reduced dollar for dollar by any insurance premiums paid or reserved for by a brand manager or casino operator pursuant to a brand management or casino management agreement relating to the MGM Grand & Mandalay Bay Properties. In addition, such monthly reserves will not be required so long as (i) no event of default is continuing, and (ii) the insurance coverage for the MGM Grand & Mandalay Bay Properties are included in a blanket policy reasonably acceptable to the lender.

  

FF&E Reserve – For so long as the MGM Grand & Mandalay Bay Properties are not subject to the Master Lease, (i) on each payment date during a MGM Grand & Mandalay Bay Trigger Period, the Borrowers will be required to make a deposit equal to (a) 4.0% of net revenue from guest rooms and Borrower-managed food and beverage operations and (b) 0.5% of all other net revenue (other than non-recurring items), in each case for the calendar month that is two months prior to the calendar month in which the applicable deposit to the replacement reserve fund is to be made (the sum of (a) and (b), the “Replacement Reserve Monthly Deposit”), and (ii) if a MGM Grand & Mandalay Bay Trigger Period does not exist, on the first payment date of each calendar quarter, an amount equal to the lesser of (x) the Replacement Reserve Current Year Lookback Deficiency (as defined below) and (y) the Replacement Reserve Five Year Lookback Deficiency (as defined below) (the lesser of (x) and (y), the “Replacement Reserve Quarterly Deposit”), provided that for so long as any individual MGM Grand & Mandalay Bay Property is managed by (x) a brand manager pursuant to a brand management agreement and/or (y) a casino operator pursuant to a casino management agreement, the amounts required to be funded as a Replacement Reserve Monthly Deposit or a Replacement Reserve Quarterly Deposit will be reduced on a dollar-for-dollar basis by any amounts deposited into a manager account for replacements, PIP work or brand mandated work for the applicable calendar months as set forth in the annual budget and required pursuant to the terms of the brand management agreement and/or casino management agreement if the Borrowers deliver evidence reasonably satisfactory to the mortgage lender that such deposit has been made.

  

A “Replacement Reserve Current Year Lookback Deficiency” means an amount equal to (x) the aggregate amount of Replacement Reserve Monthly Deposits which would have been funded from the beginning of the then calendar year to the date of determination had a MGM Grand & Mandalay Bay Trigger Period been in effect for the entirety of such period less (y) the sum of (1) the aggregate amount expended on replacements, PIP work and brand mandated work during such calendar year to date and (2) the aggregate amount funded into the Replacement Reserve during such calendar year to date; provided that, if the foregoing calculation results in a negative number, the Replacement Reserve Current Year Lookback Deficiency will be deemed to be zero.

  

A “Replacement Reserve Five Year Lookback Deficiency” means (i) zero, with respect to any period before December 31, 2024, and (ii) from and after January 1, 2025, an amount equal to (x) 4.0% of net revenue from guest rooms and Borrower-managed food and beverage

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
MGM Grand & Mandalay Bay

 

operations and 0.5% of all other net revenues (other than non-recurring items) during the Replacement Reserve Five Year Lookback Period (as defined below) less (y) the sum of (1) the aggregate amount expended on replacements, PIP Work and brand mandated work during the Replacement Reserve Five Year Lookback Period (including amounts expended by MGM Tenant pursuant to the express terms and conditions of the Master Lease) and (2) the aggregate amounts funded into the Replacement Reserve during such Replacement Reserve Five Year Lookback Period; provided, if the foregoing calculation results in a negative number, the Replacement Reserve Five Year Lookback Deficiency will be deemed to be zero.

  

A “Replacement Reserve Five Year Lookback Period” means each five year period (on a rolling basis) with the first period commencing on January 1, 2020 and expiring on December 31, 2024 and the second period commencing on January 1, 2021 and expiring on December 31, 2025.

  

Lockbox / Cash Management. The MGM Grand & Mandalay Bay Whole Loan is subject to a hard lockbox with springing cash management. Amounts on deposit in the lockbox account will be disbursed to the Borrower’s operating account in accordance with the clearing account agreement. After the occurrence and during the continuation of a MGM Grand & Mandalay Bay Trigger Period (as defined below), the Borrowers will establish a cash management account and, at least two times per week, the clearing account bank will sweep funds from the lockbox accounts into the cash management account in accordance with the clearing account agreement and the cash management bank will apply funds on deposit in the order of priority described in the MGM Grand & Mandalay Bay Whole Loan documents, with the remaining excess cash flow (“Excess Cash Flow Reserve”) to be held as additional collateral for the MGM Grand & Mandalay Bay Whole Loan (and, after the ARD, all amounts in the Excess Cash Flow Reserve account will be used to pay the monthly additional interest amount and applied to the principal of the MGM Grand & Mandalay Bay Whole Loan).

  

A “MGM Grand & Mandalay Bay Trigger Period” means a period (A) commencing upon the occurrence of any of the following: (i) the Debt Service Coverage Ratio (“DSCR”) falling below 2.50x (“DSCR Threshold”) for two consecutive quarters (“DSCR Trigger”), (ii) the MGM Tenant is subject to a bankruptcy action (“OpCo Bankruptcy”), (iii) an event of default under the MGM Grand & Mandalay Bay Whole Loan has occurred and is continuing (“EOD Trigger”), (iv) an OpCo Trigger Event (as defined below) or (v) the Borrowers fail to repay the MGM Grand & Mandalay Bay Whole Loan in full on or before the ARD and (B) terminating upon (i) in the event of a DSCR Trigger, either such time that the DSCR exceeds the DSCR Threshold for two consecutive quarters or the Borrowers make voluntary prepayments of the MGM Grand & Mandalay Bay Whole Loan in accordance with the terms of the MGM Grand & Mandalay Bay Whole Loan documents in amounts necessary to achieve a DSCR greater than or equal to the DSCR Threshold (without any obligation to wait two consecutive quarters), (ii) in the event of an OpCo Bankruptcy, the assumption of the Master Lease in such bankruptcy proceeding or the replacement of the MGM Tenant as provided in the MGM Grand & Mandalay Bay Whole Loan documents (or in the event the Master Lease is terminated and not replaced, the DSCR is equal to or greater than the DSCR Threshold or the Borrowers make voluntary prepayments of the MGM Grand & Mandalay Bay Whole Loan in accordance with the terms of the MGM Grand & Mandalay Bay Whole Loan documents in amounts necessary to achieve a DSCR greater than or equal to the DSCR Threshold (without any obligation to wait two consecutive quarters)), (iii) in the event of an OpCo Trigger Period, any OpCo Trigger Event Cure (as defined below) and (iv) in the event of an EOD Trigger, no other events of default exist and are continuing and the mortgage lender will have accepted a cure by the Borrowers of such event of default. For the avoidance of doubt, in no instance will a MGM Grand & Mandalay Bay Trigger Period caused by the failure of the Borrowers to repay the MGM Grand & Mandalay Bay Whole Loan in full on or before the ARD be capable of being cured or deemed to expire.

  

An “OpCo Trigger Event” means the occurrence and continuance of all of the following conditions simultaneously: (i) an event of default under the Master Lease has occurred and is continuing; (ii) (x) the managing member of the Joint Venture is an affiliate of the Borrowers other than MGP or MGP OP that is controlled by MGP or MGP OP and (y) MGP OP is controlled by MGM and (iii) such managing member is permitted under the terms of the Joint Venture agreement to take any of the following actions without the consent of (x) BCORE Windmill Parent LLC (the member of the Joint Venture that is affiliated with BREIT OP) (a) granting any consent, approval or wavier or making any election under the Master Lease, Lease Guaranty or other related lease documents, (b) entering into any amendment, supplement or modification to the Master Lease, Lease Guaranty or other related lease documents, or (c) declaring an event of default under the Master Lease, Lease Guaranty or other related lease documents or (y) if applicable, a Qualified Transferee (as defined in the MGM Grand & Mandalay Bay Whole Loan documents) that is not an affiliate of MGM Tenant which owns a 15% or greater direct and/or indirect interest in the Borrowers.

  

A “Lease Guaranty” means that certain Guaranty of Lease Documents dated as of February 14, 2020, made by MGM in favor of the Borrowers.

 

An “OpCo Trigger Event Cure” means, as applicable, (i) the Borrowers have provided evidence to the mortgage lender of the cure of the event of default under the Master Lease, (ii) the Borrowers have waived the event of default under the Master Lease, provided that such waiver was approved by the mortgage lender, or (iii) in the event that the event of default results in the termination of the Master Lease,

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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MGM Grand & Mandalay Bay

 

either (a) (I) the Borrowers and MGM Tenant have entered into a new lease on terms and conditions substantially similar to those contained in the Master Lease as of the origination of the MGM Grand & Mandalay Bay Whole Loan and (II) the Master Lease opinion delivery requirements have been satisfied, or (b) after giving effect to the termination of the Master Lease the DSCR is equal to or greater than 2.50x for two consecutive quarters or the Borrowers make voluntary prepayments in accordance with the terms of the MGM Grand & Mandalay Bay Whole Loan documents in an amount necessary to achieve a DSCR equal to or greater than 2.50x.

  

Current Mezzanine or Subordinate Indebtedness. In addition to the MGM Grand & Mandalay Bay Loan, the MGM Grand & Mandalay Bay Properties also secure the MGM Grand & Mandalay Bay Senior Notes not included in the Benchmark 2020-B20 mortgage trust, which have an aggregate Cut-off Date principal balance of $1,549,200,000, and the MGM Grand & Mandalay Bay Junior Notes (which have an aggregate Cut-off Date principal balance of $1,365,800,000). The MGM Grand & Mandalay Bay Senior Notes not included in the Benchmark 2020-B20 trust and the MGM Grand & Mandalay Bay Junior Notes accrue interest at the same rate as the MGM Grand & Mandalay Bay Loan. The MGM Grand & Mandalay Bay Loan is entitled to payments of interest and principal on a pro rata and pari passu basis with the MGM Grand & Mandalay Bay Senior Notes not included in the Benchmark 2020-B20 mortgage trust. The MGM Grand & Mandalay Bay Loan and the MGM Grand & Mandalay Bay Senior Notes not included in the Benchmark 2020-B20 mortgage trust are generally senior to the MGM Grand & Mandalay Bay Junior Notes.

  

Future Mezzanine or Subordinate Indebtedness Permitted. The MGM Grand & Mandalay Bay Borrowers have a one-time right to borrow a mezzanine loan subordinate to the MGM Grand & Mandalay Bay Whole Loan (“Mezzanine Loan”), subject to credit and legal criteria specified in the MGM Grand & Mandalay Bay Whole Loan documents, including, without limitation: (i) a combined maximum loan to value ratio (based on appraisals ordered by the lender in connection with the closing of the Mezzanine Loan and calculated based on the outstanding principal balance of the MGM Grand & Mandalay Bay Whole Loan and the initial principal amount of the Mezzanine Loan) of 67.0%, (ii) a debt service coverage ratio at the closing of the Mezzanine Loan at least equal to 4.81x, in each case, inclusive of the additional mezzanine debt and (iii) an intercreditor agreement reasonably satisfactory to the lender. The lender’s receipt of a rating agency confirmation will not be required in connection with the Mezzanine Loan.

 

Notwithstanding the foregoing, (1) during a MGM Grand & Mandalay Bay Trigger Period (and for so long as no event of default has occurred and is continuing), in the event that the Mezzanine Loan (or any portion thereof) is directly or indirectly or beneficially owned by the MGM Grand & Mandalay Bay Borrowers, mezzanine borrower or a “broad affiliate” (as defined in the MGM Grand & Mandalay Whole Loan documents) of the Borrowers or mezzanine borrower (“Affiliated Mezzanine Lender”), in no instance will the Affiliated Mezzanine Lender be permitted to receive late charges, principal (other than the pro rata prepayment of the Mezzanine Loan upon the release of an individual Property or prepayment of the MGM Grand & Mandalay Bay Whole Loan in accordance with the terms and conditions of the MGM Grand & Mandalay Bay Whole Loan documents and the Mezzanine Loan documents) or interest at the default rate, even if an event of default has occurred and is continuing under the Mezzanine Loan and such Affiliated Mezzanine Lender will only be permitted to receive interest at the non-default rate on a monthly basis, (2) during a MGM Grand & Mandalay Bay Trigger Period (and for so long as no event of default has occurred and is continuing under the MGM Grand & Mandalay Bay Whole Loan documents), for so long as the whole Mezzanine Loan is not directly or indirectly or beneficially owned by an Affiliated Mezzanine Lender, the mezzanine lender will receive on a monthly basis interest at the non-default rate and, if an event of default has occurred and is continuing under the Mezzanine Loan, funds sufficient to pay any other amounts then due under the Mezzanine Loan and the Mezzanine Loan documents (other than the payment of the outstanding principal amount of the Mezzanine Loan on the maturity date of the Mezzanine Loan whether on the scheduled date for such payment or earlier due to an acceleration of the Mezzanine Loan) and (3) after the ARD, in no instance will any mezzanine lender be permitted to receive any payments whatsoever.

 

Partial Release. So long as no event of default has occurred and is continuing (other than as set forth below), the Borrowers may at any time release an individual MGM Grand & Mandalay Bay Property from the MGM Grand & Mandalay Bay Whole Loan by prepaying the applicable Release Percentage (as defined below) of the ALA of the subject individual property (including any yield maintenance premium, if required), and subject to the terms and conditions in the MGM Grand & Mandalay Bay Whole Loan documents, including, without limitation: (i) the DSCR after giving effect to such release is at least equal to 4.81x; (ii) continued compliance with the single purpose entity requirements contained in the MGM Grand & Mandalay Bay Whole Loan documents; (iii) payment to an agent or servicer of the then current and customary fee by such persons for such releases in an amount not to exceed $2,000.00 and any reasonable legal fees or other out-of-pocket costs incurred by the lender to effect the release and any applicable prepayment premiums (provided the legal fees may not exceed $10,000.00); (iv) payment of all recording charges, filing fees, taxes or other similar expenses payable in connection therewith; (v) compliance with applicable REMIC requirements relating to the REMIC 125% LTV test for release which may be satisfied by delivery of any of the following if permitted by REMIC requirements: an existing or updated appraisal, a broker’s price opinion or other written determination of value using a commercially reasonable valuation method, in each case satisfactory to the lender, but will be based solely on the value of real property and will exclude personal property and going-concern value; and (vi) if the property is subject to the Master Lease, the Borrowers removing the released individual property from the Master Lease and entering into a new triple-net

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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lease with respect to the remaining individual property on substantially the same terms as the Master Lease (collectively, the “Release Conditions”).

  

A “Release Percentage” means, with respect to any individual MGM Grand & Mandalay Bay Property, 105.0% until such time as the outstanding principal balance of the MGM Grand & Mandalay Bay Whole Loan is reduced to $2,250,000,000 (the “Release Percentage Threshold”), and 110.0% thereafter. In calculating the Release Amount for an individual Property, the Release Percentage may initially be one hundred and five percent (105%) until the application of a portion of such prepayment would reach the Release Percentage Threshold and with respect to any remaining prepayment for such individual Property, the Release Percentage would be one hundred and ten percent (110%).

 

Notwithstanding the foregoing, in the event that the DSCR following the release would not satisfy the DSCR requirement in clause (i) of the Release Conditions, and such release is in connection with an arms’ length transaction with an unrelated third party, the Borrowers will be permitted to release the subject property and the amount that will be required to be prepaid (or defeased) in connection with such Release will equal the greater of (I) the Release Percentage of the ALA for such individual property, together with, to the extent the release does not occur in connection with a partial defeasance, any yield maintenance premium required (if any) and (II) the lesser of (x) one hundred percent (100.0%) of the net sales proceeds for the sale of such individual property (net of reasonable and customary closing costs associated with the sale of such individual property) and (y) an amount necessary to, after giving effect to such release of the individual property, achieve the DSCR requirement in the preceding paragraph.

 

The Borrowers may release any defaulting individual property, without the payment of any yield maintenance premium, in order to cure a default or an event of default related to such individual property, subject to the satisfaction of other terms and conditions in the MGM Grand & Mandalay Bay Whole Loan documents (including, without limitation, Release Conditions (other than clause (i)) (“Default Release”). In addition, the Borrowers may release an individual property (including to an affiliate) if the estimated net proceeds following any casualty or condemnation at such individual Property will be equal to or greater than (x) 25.0% of its ALA, or (y) 5.0% of its ALA (subject to the satisfaction of other terms and conditions in the MGM Grand & Mandalay Bay Whole Loan documents) upon satisfaction of clauses (iii), (iv) and (v) of the Release Conditions above and prepayment of the MGM Grand & Mandalay Bay Whole Loan in an amount equal to the net proceeds (up to an amount equal to the Release Percentage) for such individual property (“Special Release”).

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Structural and Collateral Term SheetBenchmark 2020-B20
  
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THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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Mortgage Loan Information

 

Property Information

Mortgage Loan Seller:

Original Principal Balance(1):

JPMCB

$62,500,000

 

Single Asset / Portfolio:

Title:

Single Asset

Fee/Leasehold

Cut-off Date Principal Balance(1):$62,500,000 Property Type - Subtype:Mixed Use – Office/Retail
% of Pool by IPB:6.9% Net Rentable Area (SF):83,537
Loan Purpose:Recapitalization Location:New York, NY
Borrowers:Ulysses Co. II, L.L.C., Year Built / Renovated:1948 / 2016-2019
 Solow Building Company III, L.L.C. Occupancy(3):100.0%
Sponsor:Sheldon H. Solow Occupancy Date:10/1/2020
Interest Rate:3.68000% Number of Tenants:9
Note Date:2/28/2020 2017 NOI:$2,908,139
Maturity Date:3/1/2030 2018 NOI(2):$2,974,304
Interest-only Period:120 months 2019 NOI(2):$3,570,977
Original Term:120 months TTM NOI (as of 6/2020):$4,519,138
Original Amortization:None UW Economic Occupancy:95.0%
Amortization Type:Interest Only UW Revenues(4):$11,943,386
Call Protection:L(31),Def(83),O(6) UW Expenses(4):$2,701,328
Lockbox / Cash Management:Hard / Springing UW NOI(2)(4)(6):$9,242,058
Additional Debt(1):Yes UW NCF(4)(6):$9,059,948
Additional Debt Balance(1):$62,500,000 Appraised Value / Per SF(6):$180,000,000 / $2,155
Additional Debt Type(1):Pari Passu Appraisal Date:2/1/2020
     
     

 

Escrows and Reserves(5) Financial Information(1)(6)
 InitialMonthlyInitial Cap Cut-off Date Loan / SF:$1,496
Taxes:$91,175$91,175N/A Maturity Date Loan / SF:$1,496
Insurance:$4,669$4,669N/A Cut-off Date LTV:69.4%
Replacement Reserves:$0$1,392$33,408 Maturity Date LTV:69.4%
TI/LC:$7,811,435$13,932$835,920 UW NCF DSCR:1.94x
Other:$5,799,156$0N/A UW NOI Debt Yield:7.4%
Excess Cash Flow Reserve:$1,341,385NAPNAP   
       

 

Sources and Uses

Sources

Proceeds

 

% of Total

Uses

Proceeds

% of Total

Whole Loan$125,000,000100.0%Return of Equity$107,093,48285.7%
   Upfront Reserves13,706,43511.0   
   Closing Costs4,200,0833.4   
Total Sources$125,000,000100.0%Total Uses$125,000,000100.0%
(1)The 4 West 58th Street loan is part of a whole loan evidenced by three pari passu notes, with an aggregate outstanding principal balance as of the Cut-off Date of $125.0 million. Financial Information presented in the chart above reflects the Cut-off Date balance of the $125.0 million 4 West 58th Street Whole Loan (as defined below). For additional information, see “The Loan” herein.

(2)The increase in UW NOI from 2018 NOI is primarily attributable to six of the nine tenants accounting for 40.8% of net rentable area and 65.8% of underwritten base rent taking occupancy between 2018 and July 2020.

(3)Occupancy and UW NCF are inclusive of Netflix Inc., J2 Enterprises LTD., Northwell Health, Neistein Plastic Surgery and PP North America US Inc., all of which have executed their respective leases and/or taken possession of their space but are not yet in occupancy and/or paying rent. Netflix Inc. has taken possession of its’ space, is in the process of building out its’ space and is scheduled to commence paying rent in March 2021. J2 Enterprises LTD. is expected to complete its’ renovation in December 2020. Northwell Health and Neistein Plastic Surgery have taken possession of their space and are scheduled to begin paying rent in December 2020.

(4)UW figures are based on the underwritten rent roll dated as of October 1, 2020 which accounts for all executed leases (whether or not tenants are in occupancy and/or have commenced paying rent with rent steps underwritten through July 2021. For avoidance of doubt, no COVID-19 specific adjustments have been incorporated into the lender underwriting.

(5)For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below.

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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(6)All NOI, NCF and occupancy information, as well as the appraised value, were determined prior to the emergence of the novel coronavirus pandemic, and the economic disruption resulting from measures to combat the pandemic, and all DSCR, LTV and Debt Yield metrics were calculated, and the 4 West 58th Street loan was underwritten, based on such prior information. See “Risk Factors—Risks Related to Market Conditions and Other External Factors—Coronavirus Pandemic Has Adversely Affected the Global Economy and Will Likely Adversely Affect the Performance of the Mortgage Loans” in the Preliminary Prospectus.

 

The Loan. The 4 West 58th Street mortgage loan (the “4 West 58th Street Loan”) is part of a whole loan with an aggregate outstanding principal balance as of the Cut-off Date of $125.0 million (the “4 West 58th Street Whole Loan”), secured by the borrowers’ fee simple and leasehold interests in an approximately 83,537 square foot Class A, multi-tenant, office and retail building located in New York, New York. The controlling Note A-1, with an outstanding principal balance as of the Cut-off Date of $62.5 million, will be included in the Benchmark 2020-B20 trust. The remaining notes have been, or are expected to be, contributed to one or more future securitization trusts. The relationship between the holders of the 4 West 58th Street Whole Loan is governed by a co-lender agreement as described under “Description of the Mortgage Pool—The Whole Loans—The Serviced Pari Passu Whole Loans” in the Preliminary Prospectus. The 4 West 58th Street Whole Loan has a 10-year term and will be interest-only for the term of the loan.

 

Whole Loan Summary
NoteOriginal BalanceCut-off Date BalanceNote HolderControlling Piece
Note A-1$62,500,000$62,500,000Benchmark 2020-B20Yes
Note A-2$37,500,000$37,500,000JPMCB(1)No
Note A-3$25,000,000$25,000,000JPMCB(1)No
Whole Loan$125,000,000$125,000,000
(1)Expected to be contributed to one or more future securitization transactions.

 

The Borrowers. The borrowers are Ulysses Co. II, L.L.C., and Solow Building Company III, L.L.C., each a Delaware limited liability company (collectively, the “Borrowers”), with two independent directors in their organizational structures.

 

The Loan Sponsor. Sheldon H. Solow is the loan sponsor and non-recourse carveout guarantor. Sheldon H. Solow, who is the founder and CEO of Solow Building Company L.L.C. (“Solow Building Company”), has been an owner and developer of residential and commercial properties in New York for over 50 years. Solow Building Company is a Manhattan-based real estate company specializing in design, construction and property management for commercial and residential properties. Founded in 1965, Solow Building Company has a real estate portfolio comprised of buildings throughout Manhattan. Sheldon Solow’s holdings include 9 West 57th Street, a 50-story black glass office tower with views of Central Park, which is located adjacent to the 4 West 58th Street property. Mr. Solow’s residential portfolio includes One and Two Sutton Place North and the Solow Townhouses in the Upper East Side.

 

The Property. The 4 West 58th Street property is a 14-story, 83,537 square foot mixed-use building located in New York, New York. The property is located on 58th Street between 5th Avenue and 6th Avenue and is situated across from the Plaza, on the southwest corner of the Grand Army Plaza with unobstructed views of Central Park. The property is divided between 11 stories of office, retail and theater space located on the ground-floor. As of October 1, 2020 the retail and office components are 100.0% leased. The property benefits from various nearby attractions and amenities, including Central Park, Rockefeller Center, Radio Music Hall, Columbus Circle, and the Museum of Modern Art. Additionally, the property is known for its desirable location in the Plaza District, as it is located on “Billionaire’s Row” and is adjacent to Bergdorf Goodman’s flagship store. The 4 West 58th Street property was originally constructed in 1948 and was home to the Paris Theater for over 70 years until August 2019. Since 2016, the property has undergone approximately $16.9 million in renovations and upgrades between landlord work and tenant improvements, of which approximately $11.6 million was invested in the build-out of the Neiman Marcus space. In March of 2020, the Borrowers began a comprehensive base building renovation of the space previously occupied by the Paris Theater. During this time, $1.5 million of base building improvements were made by the Borrowers for various improvements to HVAC systems, electrical equipment, sprinklers and safety equipment. The Borrowers delivered the space to Netflix in September of 2020, at which point Netflix began tenant specific buildout of its’ space. Netflix is expected to re-open in July 2021.

 

As of October 1, 2020, the 4 West 58th Street property is 100.0% leased to a diverse roster of nine tenants. There are three designated retail tenants and six office tenants. The tenants have a weighted average remaining lease term of approximately 10.94 years. Despite occupying approximately 23.8% of net rentable area, retail tenants will account for approximately 52.9% of underwritten base rent which is largely driven by the Netflix rent. Since November of 2019, the Borrowers have completed 34,121 square feet of new leases at the 4 West 58th Street property, of which 10,651 square feet is attributable to retail space and 23,470 square feet is attributable to office space. Each medical office tenant at the 4 West 58th Street property occupies their own floor with views of Central Park.

 

The largest tenant, The Neiman Marcus Group LLC. (“Neiman Marcus”), (40,170 square feet; 48.1% of net rentable area; 28.6% of underwritten base rent), is an American chain of luxury department stores owned by the Neiman Marcus Group, headquartered in Dallas, Texas. Founded in 1907, the retail company offers women's and men's apparel, handbags, shoes, cosmetics, jewelry, and home decoration products, serving customers worldwide. Neiman Marcus occupies space across six floors and has been at the property for

 

THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.

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almost four years. The property serves as an extension of its’ flagship Berdorf Goodman store located on 5th Avenue and is interconnected to the store on five floors. Employees can walk seamlessly between the two buildings. Neiman Marcus utilizes the space for offices tailoring/alteration and excess inventory storage. Neiman Marcus executed a lease in September of 2016, which expires in February of 2033. Neiman Marcus filed for bankruptcy under chapter 11 of the Bankruptcy Code on May 7, 2020, and subsequently emerged from bankruptcy on September 25, 2020. As part of the bankruptcy filing, Neiman Marcus assumed its lease at the 4 West 58th Street property and is current with respect to all contractual rent obligations. When Neiman Marcus filed bankruptcy, this caused a Tenant Trigger Event (as defined below) pursuant to the terms set forth in the loan agreement and excess cash flow since May has been deposited in an excess cash flow reserve. The excess cash flow reserve account has a current balance as of October 1, 2020 of $1,341,385.

 

The second largest tenant, Netflix Inc. (“Netflix”) (10,651 square feet, 12.8% of net rentable area, 47.3% of underwritten base rent), is an internet subscription service company, providing movies and television episodes via the internet and mail. Founded in 1997, Netflix has become a leading internet streaming company, distributing movies and TV shows in a variety of genres and languag