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GS Mortgage Securities Trust 2019-GC40

Filed: 11 Jul 19, 5:11pm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)     July 11, 2019                                    

 

GS Mortgage Securities Trust 2019-GC40

(Central Index Key Number 0001778232)
(Exact name of issuing entity)

 

GS Mortgage Securities Corporation II

(Central Index Key Number 0001004158)

(Exact name of the depositor as specified in its charter)


Goldman Sachs Mortgage Company

(Central Index Key Number 0001541502)

 

Citi Real Estate Funding Inc.

(Central Index Key Number 0001701238)

 

German American Capital Corporation

(Central Index Key Number 0001541294)

(Exact name of the sponsors as specified in its charters)

 

Delaware333-226082-0322-3442024
(State or other jurisdiction of incorporation of depositor)(Commission File Number of issuing entity)(IRS Employer Identification No. of depositor)

 

 

          200 West Street

          New York, New York

10282
(Address of principal executive offices of depositor)(Zip Code of depositor)

Depositor’s telephone number, including area code     (212) 902-1000                               

 

Not Applicable
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
  

 

 
 

 

Item 8.01         Other Events.

On July 11, 2019 (the “Closing Date”), GS Mortgage Securities Corporation II (the “Depositor”) caused (i) the issuance of GS Mortgage Securities Trust 2019-GC40, Commercial Mortgage Pass-Through Certificates, Series 2019-GC40 (the “Certificates”) and (ii) the creation of an uncertificated interest (the “Pooled RR Interest”, and, together with the Class RR Certificates, the “Pooled VRR Interest”) in the Issuing Entity (as defined below) representing the right to receive a specified percentage of certain amounts collected on the Mortgage Loans (as defined below), net of all expenses of the Issuing Entity, in each case pursuant to a pooling and servicing agreement, dated as of July 1, 2019 and as to which an executed version is attached hereto asExhibit 4.1 (the “Pooling and Servicing Agreement”), among the Depositor, as depositor, Midland Loan Services, a Division of PNC Bank, National Association, as master servicer and as special servicer, Wells Fargo Bank, National Association, as certificate administrator and as trustee, and Pentalpha Surveillance LLC, as operating advisor and as asset representations reviewer.

The assets of the Issuing Entity (as defined below) include several Mortgage Loans each of which is a part of a Whole Loan. Each Whole Loan is governed by a co-lender, intercreditor or similar agreement (each, a “Co-Lender Agreement”) between the holders of the promissory notes comprising such Whole Loan, the terms of which are described under “Description of the Mortgage Pool—The Whole Loans” in the Prospectus dated June 27, 2019 and filed with the Securities and Exchange Commission on July 11, 2019 (the “Prospectus”). Each Co-Lender Agreement is attached as an exhibit hereto as described in the following table. Moreover, certain of such Whole Loans will not be serviced pursuant to the Pooling and Servicing Agreement, but will instead be serviced pursuant to a different servicing agreement (each, a “Non-Serviced PSA”). Each such Non-Serviced PSA is attached as an exhibit hereto as described in the following table. For a description of the servicing of the applicable Whole Loans under such Non-Serviced PSAs, see “Pooling and Servicing Agreement—Servicing of the Non-Serviced Mortgage Loans” in the Prospectus.

Name of Co-Lender Agreement (as defined in the Pooling and Servicing Agreement)

Co-Lender Agreement

Exhibit

Non-Serviced Servicing Agreement (if any) Exhibit
101 California Street Co-Lender Agreement4.74.2
59 Maiden Lane Co-Lender Agreement4.84.3
Moffett Towers II Building V Co-Lender Agreement4.94.3
Diamondback Industrial Portfolio 1 Co-Lender Agreement4.10N/A
Diamondback Industrial Portfolio 2 Co-Lender Agreement.4.11N/A
Waterford Lakes Town Center Co-Lender Agreement4.124.3
250 Livingston Co-Lender Agreement4.13N/A
Waterfront Plaza Co-Lender Agreement4.14N/A
Western Digital R&D Campus Co-Lender Agreement4.154.4
Green Hills Corporate Center Co-Lender Agreement4.164.4
ARC Apartments Co-Lender Agreement4.174.5
Newport Corporate Center Co-Lender Agreement4.184.6
57 East 11th Street Co-Lender Agreement4.19N/A

The Certificates will consist of the following classes, designated as (i) the Class A-1, Class A-2, Class A-3, Class A-4, Class A-AB, Class X-A, Class X-B, Class A-S, Class B and Class C Certificates

 
 

(collectively, the “Public Certificates”), (ii) the Class D, Class X-D, Class E, Class F, Class X-F, Class G-RR, Class H-RR and Class R Certificates (collectively, the “Private Certificates”), (iii) the Class DB-A, Class DB-X, Class DB-B, Class DB-C, Class DB-D, Class DB-E and Class DB-F Certificates (collectively, the “Loan-Specific Certificates”) and (iv) the Class RR, Class S and Class DB-VR Certificates.

All of the Public Certificates, having an aggregate initial principal amount of $791,990,000, were sold to Goldman Sachs & Co. LLC (“GS&Co.”), Citigroup Global Markets Inc. (“CGMI”), Deutsche Bank Securities Inc. (“DBSI”), Academy Securities, Inc. (“Academy”) and Drexel Hamilton, LLC (“Drexel”, and together with GS&Co., CGMI, DBSI and Academy, in such capacities, the “Underwriters”), pursuant to an underwriting agreement, dated as of June 26, 2019 (the “Underwriting Agreement”) and as to which an executed version is attached hereto asExhibit 1.1, among the Depositor and the Underwriters. GS&Co., CGMI and DBSI are acting as the co-lead managers. The Public Certificates were offered by the Underwriters for sale to the public, pursuant to the Depositor’s Prospectus in negotiated transactions or otherwise at varying prices determined at the time of sale.

In connection with the issuance and sale to the Underwriters of the Public Certificates, a legal opinion was rendered related to the validity of, and certain federal income tax considerations relating to, the Public Certificates, which legal opinion is attached hereto asExhibits 5,8 and23.

All of the Private Certificates, having an aggregate initial principal amount of $87,999,274, were sold to GS&Co., CGMI, DBSI, Academy and Drexel (together, in such capacities, the “Initial Purchasers”), pursuant to a purchase agreement, dated as of June 26, 2019, among the Depositor and the Initial Purchasers. The Private Certificates were sold to the Initial Purchasers in a transaction exempt from registration under the Securities Act of 1933, as amended (the “Act”), pursuant to Section 4(a)(2) of the Act.

All of the Loan-Specific Certificates, having an aggregate initial principal amount of $115,187,500, were sold to GS&Co. and DBSI (together, in such capacities, the “Loan-Specific Initial Purchasers”), pursuant to a loan-specific purchase agreement, dated as of June 26, 2019, among the Depositor and the Loan-Specific Initial Purchasers. The Loan-Specific Certificates were sold to the Loan-Specific Initial Purchasers in a transaction exempt from registration under the Securities Act of 1933, as amended (the “Act”), pursuant to Section 4(a)(2) of the Act.

The Certificates and the Pooled RR Interest represent, in the aggregate, the entire beneficial ownership in GS Mortgage Securities Trust 2019-GC40 (the “Issuing Entity”), a common law trust fund formed under the laws of the State of New York pursuant to the Pooling and Servicing Agreement. The assets of the Issuing Entity consist primarily of 35 fixed-rate mortgage loans (the “Mortgage Loans”) and subordinate interests in two commercial mortgage loans (the “Trust Subordinate Companion Loans”) secured by first liens on 44 commercial and multifamily properties. The Mortgage Loans and the Trust Subordinate Companion Loans were acquired by the Depositor from (i) Goldman Sachs Mortgage Company (“GSMC”), pursuant to a mortgage loan purchase agreement, attached hereto asExhibit 99.1 and dated as of July 1, 2019 (the “GSMC Mortgage Loan Purchase Agreement”), between the Depositor and GSMC, (ii) Citi Real Estate Funding Inc. (“CREFI”), pursuant to a mortgage loan purchase agreement, attached hereto asExhibit 99.2 and dated as of July 1, 2019 the “CREFI Mortgage Loan Purchase Agreement”), between the Depositor and CREFI, and (iii) German American Capital Corporation (“GACC” and, together with GSMC and CREFI, the “Sponsors”), pursuant to a mortgage loan purchase agreement, attached hereto asExhibit 99.3 and dated as of July 1, 2019 (the “GACC Mortgage Loan Purchase Agreement”, and together with the GSMC Mortgage Loan Purchase Agreement and the CREFI Mortgage Loan Purchase Agreement, the “Mortgage Loan Purchase Agreements”), between the Depositor and GACC.

 
 

The compensation for the Mortgage Loans and the Trust Subordinate Companion Loans paid to the Sponsors included net proceeds of the sale of the Certificates. The net proceeds to the Depositor of the sale of the Certificates, after deducting expenses payable by the Depositor in connection with the issuance and distribution of the Certificates of approximately $4,920,984, were approximately $1,056,850,796. Of the expenses paid by the Depositor, approximately $360,773 were paid directly to affiliates of the Depositor, approximately $410,773 in the form of fees were paid to the Underwriters and the Initial Purchasers, approximately $160,000 were paid to or for the Underwriters and the Initial Purchasers, and approximately $4,350,211 were other expenses. All of the foregoing expense amounts are the Depositor’s reasonable estimates of such expenses. No underwriting discounts and commissions or finder's fees were paid by the Depositor. Further information regarding such sales relating to the price per class of Public Certificates is set forth on Schedule II to the Underwriting Agreement.

Further information regarding such sales has been previously provided in the Depositor’s Prospectus, dated June 27, 2019. The related registration statement (file no. 333-226082) was originally declared effective on December 21, 2018. In connection with such Prospectus, the Chief Executive Officer of the Depositor has provided the certification attached hereto asExhibit 36.1 and dated as of June 27, 2019.

GSMC, in its capacity as “retaining sponsor” (in such capacity, the “Pooled Retaining Sponsor”) is satisfying its credit risk retention obligation under Regulation RR, 12 C.F.R. Part 244 (the “Risk Retention Rule”) in connection with the securitization of the Mortgage Loans referred to above by (i) the purchase on the Closing Date and holding by Eightfold Real Estate Capital Fund V, L.P., acting as a third-party purchaser under the Risk Retention Rule, of the Class G-RR and Class H-RR Certificates (the “HRR Certificates”), (ii) the purchase of the Class RR Certificates by CREFI and Deutsche Bank AG, New York Branch (“DBNY”) from the Depositor (which is deemed to be purchased from the Depositor by the Retaining Sponsor and from the Retaining Sponsor by CREFI and DBNY), and (iii) the purchase of the Pooled RR Interest by the Pooled Retaining Sponsor from the Depositor.

The Pooled VRR Interest constitutes an “eligible vertical interest” (as defined in the Risk Retention Rule) that represents the right to receive at least 3.74% of all amounts collected on the Mortgage Loans, net of all expenses of the Issuing Entity, and distributed on the Pooled Certificates (other than the Class R Certificates) and the Pooled RR Interest.

The HRR Certificates constitute an “eligible horizontal residual interest” (as defined in the Risk Retention Rule). The aggregate fair value of the HRR Certificates is equal to approximately $35,200,274 (excluding accrued interest), representing at least 1.2828% of the aggregate fair value of all of the Pooled Certificates (other than the Class R Certificates) and the Pooled RR Interest. The fair value of the Pooled Certificates (other than the Class RR and Class R Certificates) was determined based on the actual sale prices and finalized tranche sizes of such Certificates.  The fair value of the Pooled VRR Interest was determined by multiplying (i) the weighted average of the actual sales prices of the Pooled Certificates (other than the Class RR and Class R Certificates), by (ii) $34,190,317, which is the initial balance of the Pooled VRR Interest.

The fair value of the “eligible horizontal residual interest” (as defined in the Risk Retention Rule) that the Pooled Retaining Sponsor is required to retain under the credit risk retention requirements of the Risk Retention Rule is equal to approximately $48,483,214, representing 5% of the aggregate fair value of all of the Pooled Certificates (other than the Class R Certificates) and the Pooled RR Interest.

As of the Closing Date, there are no material differences between (a) the valuation methodology or any of the key inputs and assumptions that were used in calculating the fair value or range of fair values disclosed in the Depositor’s Preliminary Prospectus, dated June 19, 2019, under the heading

 
 

Credit Risk Retention” prior to the pricing of the Pooled Certificates and (b) the methodology or the key inputs and assumptions that were used in calculating the fair value at the time of the Closing Date.

Additionally, GACC, in its capacity as “retaining sponsor” (in such capacity, the “Diamondback Retaining Sponsor”) is satisfying its credit risk retention obligation under the Risk Retention Rule in connection with the securitization of the Trust Subordinate Companion Loans referred to above by acquiring from the Depositor on the Closing Date and retaining the Class DB-VR Certificates. The Class DB-VR Certificates constitute an “eligible vertical interest” (as defined in the Risk Retention Rule) that represents the right to receive 5% of all amounts collected on the Trust Subordinate Companion Loans, net of all expenses of the Issuing Entity, and distributed on the Loan-Specific Certificates and the Class DB-VR Certificates.

The Underwriting Agreement, the Pooling and Servicing Agreement and the Mortgage Loan Purchase Agreements are attached as exhibits to this Form 8-K.

 
 

 

Item 9.01.Financial Statements, Pro Forma Financial Information and Exhibits.
(d)                Exhibits
Exhibit 1.1Underwriting Agreement, dated as of June 26, 2019, by and among GS Mortgage Securities Corporation II, as depositor, and Goldman Sachs & Co. LLC, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Academy Securities, Inc. and Drexel Hamilton, LLC, as underwriters.
Exhibit 4.1Pooling and Servicing Agreement, dated as of July 1, 2019, by and among GS Mortgage Securities Corporation II, as depositor, Midland Loan Services, a Division of PNC Bank, National Association, as master servicer and as special servicer, Wells Fargo Bank, National Association, as certificate administrator and as trustee, and Pentalpha Surveillance LLC, as operating advisor and as asset representations reviewer.
Exhibit 4.2CALI 2019-101C TSA (as defined in the Trust and Servicing Agreement).
Exhibit 4.3GSMS 2019-GC39 PSA (as defined in the Pooling and Servicing Agreement).
Exhibit 4.4Benchmark 2019-B11 PSA (as defined in the Pooling and Servicing Agreement).
Exhibit 4.5Benchmark 2019-B10 PSA (as defined in the Pooling and Servicing Agreement).
Exhibit 4.6BANK 2019-BNK18 PSA (as defined in the Pooling and Servicing Agreement).
Exhibit 4.7101 California Street Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 4.859 Maiden Lane Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 4.9Moffett Towers II Building V Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 4.10Diamondback Industrial Portfolio 1 Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 4.11Diamondback Industrial Portfolio 2 Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 4.12Waterford Lakes Town Center Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 4.13250 Livingston Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 4.14Waterfront Plaza Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
 
 

 

Exhibit 4.15Western Digital R&D Campus Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 4.16Green Hills Corporate Center Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 4.17ARC Apartments Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 4.18Newport Corporate Center Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 4.1957 East 11th Street Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).
Exhibit 5Legality Opinion of Cadwalader, Wickersham & Taft LLP, dated July 11, 2019.
Exhibit 8Tax Opinion of Cadwalader, Wickersham & Taft LLP, dated July 11, 2019 (included as part of Exhibit 5).
Exhibit 23Consent Opinion of Cadwalader, Wickersham & Taft LLP, dated July 11, 2019 (included as part of Exhibit 5).
Exhibit 36.1Depositor’s Certification for Shelf Offerings of Asset-Backed Securities in respect of that certain Prospectus, dated June 27, 2019.
Exhibit 99.1Mortgage Loan Purchase Agreement, dated as of July 1, 2019, between Goldman Sachs Mortgage Company, as seller, and GS Mortgage Securities Corporation II, as purchaser.
Exhibit 99.2  Mortgage Loan Purchase Agreement, dated as of July 1, 2019, between Citi Real Estate Funding Inc., as seller, and GS Mortgage Securities Corporation II, as purchaser.
Exhibit 99.3  Mortgage Loan Purchase Agreement, dated as of July 1, 2019, between German American Capital Corporation, as seller, and GS Mortgage Securities Corporation II, as purchaser.

 

 

 
 

Pursuant to the requirements of the Securities Exchange Act of 1934, the depositor has caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

Date: July 11, 2019 GS MORTGAGE SECURITIES
  

    CORPORATION II

 

   
   
   
 By:/s/ Leah Nivison
  Name:Leah Nivison
  Title:   Chief Executive Officer

 

 
 

 

INDEX TO EXHIBITS

Item 601(a) of

Regulation S-K

Exhibit No.

 Description

Paper (P) or

Electronic (E)

1.1 Underwriting Agreement, dated as of June 26, 2019, by and among GS Mortgage Securities Corporation II, as depositor, and Goldman Sachs & Co. LLC, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Academy Securities, Inc. and Drexel Hamilton, LLC, as underwriters.(E)

4.1

 

 

 

 Pooling and Servicing Agreement, dated as of July 1, 2019, by and among GS Mortgage Securities Corporation II, as depositor, Midland Loan Services, a Division of PNC Bank, National Association, as master servicer and as special servicer, Wells Fargo Bank, National Association, as certificate administrator and as trustee, and Pentalpha Surveillance LLC, as operating advisor and as asset representations reviewer.(E)
4.2 CALI 2019-101C TSA (as defined in the Trust and Servicing Agreement).(E)
4.3 GSMS 2019-GC39 Pooling and Servicing Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.4 Benchmark 2019-B11 Pooling and Servicing Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.5 Benchmark 2019-B10 Pooling and Servicing Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.6 BANK 2019-BNK18 Pooling and Servicing Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.7 101 California Street Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.8 59 Maiden Lane Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.9 Moffett Towers II Building V Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.10 Diamondback Industrial Portfolio 1 Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.11 Diamondback Industrial Portfolio 2 Co-Lender(E)
 
 

 

  Agreement (as defined in the Pooling and Servicing Agreement). 
4.12 Waterford Lakes Town Center Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.13 250 Livingston Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.14 Waterfront Plaza Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.15 Western Digital R&D Campus Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.16 Green Hills Corporate Center Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.17 ARC Apartments Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.18 Newport Corporate Center Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
4.19 57 East 11th Street Co-Lender Agreement (as defined in the Pooling and Servicing Agreement).(E)
5 Legality Opinion of Cadwalader, Wickersham & Taft LLP, dated July 11, 2019.(E)
8 Tax Opinion of Cadwalader, Wickersham & Taft LLP, dated July 11, 2019 (included as part of Exhibit 5).(E)
23 Consent Opinion of Cadwalader, Wickersham & Taft LLP, dated July 11, 2019 (included as part of Exhibit 5).(E)
36.1 Depositor’s Certification for Shelf Offerings of Asset-Backed Securities in respect of that certain Prospectus, dated June 27, 2019.(E)
99.1 Mortgage Loan Purchase Agreement, dated as of July 1, 2019, between Goldman Sachs Mortgage Company, as seller, and GS Mortgage Securities Corporation II, as purchaser. 
99.2 Mortgage Loan Purchase Agreement, dated as of July 1, 2019, between Citi Real Estate Funding Inc., as seller, and GS Mortgage Securities Corporation II, as purchaser. 
99.3 Mortgage Loan Purchase Agreement, dated as of July 1, 2019, between German American Capital Corporation, as seller, and GS Mortgage Securities Corporation II, as purchaser.