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Wells Fargo Commercial Mortgage Trust 2021-C60

Filed: 12 Jul 21, 3:55pm

  FREE WRITING PROSPECTUS
  FILED PURSUANT TO RULE 433
  REGISTRATION FILE NO.: 333-226486-21
   

 

(GRAPHIC)(GRAPHIC)(GRAPHIC)

 

Free Writing Prospectus

 Structural and Collateral Term Sheet

 

$748,633,043

(Approximate Initial Pool Balance)

 

$645,696,000
(Approximate Aggregate Certificate Balance of Offered Certificates)

 

Wells Fargo Commercial Mortgage Trust 2021-C60

as Issuing Entity

 

Wells Fargo Commercial Mortgage Securities, Inc.

as Depositor

 

LMF Commercial, LLC

 Wells Fargo Bank, National Association

 Column Financial, Inc.

UBS AG

 BSPRT CMBS Finance, LLC

 Ladder Capital Finance LLC

as Sponsors and Mortgage Loan Sellers

 

 

Commercial Mortgage Pass-Through Certificates
Series 2021-C60

 

 

July 12, 2021

 

WELLS FARGO SECURITIES

 

Co-Lead Manager and

Joint Bookrunner

CREDIT SUISSE

 

Co-Lead Manager and

Joint Bookrunner

UBS SECURITIES LLC

 

Co-Lead Manager and

Joint Bookrunner

   

Academy Securities

Co-Manager 

Drexel Hamilton

Co-Manager

Siebert Williams Shank

Co-Manager

 

 

STATEMENT REGARDING THIS FREE WRITING PROSPECTUS

 

The depositor has filed a registration statement (including a prospectus) with the Securities and Exchange Commission (“SEC”) (SEC File No. 333-226486) for the offering to which this communication 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 after filing if you request it by calling toll free 1-800-745-2063 (8 a.m. – 5 p.m. EST) or by emailing wfs.cmbs@wellsfargo.com.

 

Nothing in this document constitutes an offer of securities for sale in any jurisdiction where the offer or sale is not permitted. The information contained herein is preliminary as of the date hereof, supersedes any such information previously delivered to you and will be superseded by any such information subsequently delivered and ultimately by the final prospectus relating to the securities. These materials are subject to change, completion, supplement or amendment from time to time.

 

This free writing prospectus has been prepared by the underwriters for information purposes only and does not constitute, in whole or in part, a prospectus for the purposes of (i) Regulation (EU) 2017/1129 (as amended), (ii) such Regulation as it forms part of UK domestic law, or (iii) Part VI of the UK Financial Services and Markets Act 2000, as amended; and does not constitute an offering document for any other purpose.

 

STATEMENT REGARDING ASSUMPTIONS AS TO SECURITIES, PRICING ESTIMATES AND OTHER INFORMATION

 

The attached information contains certain tables and other statistical analyses (the “Computational Materials”) which have been prepared in reliance upon information furnished by the Mortgage Loan Sellers. Numerous assumptions were used in preparing the Computational Materials, which may or may not be reflected herein. As such, no assurance can be given as to the Computational Materials’ accuracy, appropriateness or completeness in any particular context; or as to whether the Computational Materials and/or the assumptions upon which they are based reflect present market conditions or future market performance. The Computational Materials should not be construed as either projections or predictions or as legal, tax, financial or accounting advice. You should consult your own counsel, accountant and other advisors as to the legal, tax, business, financial and related aspects of a purchase of these securities. Any weighted average lives, yields and principal payment periods shown in the Computational Materials are based on prepayment and/or loss assumptions, and changes in such prepayment and/or loss assumptions may dramatically affect such weighted average lives, yields and principal payment periods. In addition, it is possible that prepayments or losses on the underlying assets will occur at rates higher or lower than the rates shown in the attached Computational Materials. The specific characteristics of the securities may differ from those shown in the Computational Materials due to differences between the final underlying assets and the preliminary underlying assets used in preparing the Computational Materials. The principal amount and designation of any security described in the Computational Materials are subject to change prior to issuance. None of Wells Fargo Securities, LLC, UBS Securities LLC, Credit Suisse Securities (USA) LLC, Academy Securities, Inc., Drexel Hamilton, LLC, Siebert Williams Shank & Co., LLC or any of their respective affiliates, make any representation or warranty as to the actual rate or timing of payments or losses on any of the underlying assets or the payments or yield on the securities. The information in this presentation is based upon management forecasts and reflects prevailing conditions and management’s views as of this date, all of which are subject to change. In preparing this presentation, we have relied upon and assumed, without independent verification, the accuracy and completeness of all information available from public sources or which was provided to us by or on behalf of the Mortgage Loan Sellers or which was otherwise reviewed by us.

 

This free writing prospectus contains certain forward-looking statements. If and when included in this free writing prospectus, the words “expects”, “intends”, “anticipates”, “estimates” and analogous expressions and all statements that are not historical facts, including statements about our beliefs or expectations, are intended to identify forward-looking statements. Any forward-looking statements are made subject to risks and uncertainties which could cause actual results to differ materially from those stated. Those risks and uncertainties include, among other things, declines in general economic and business conditions, increased competition, changes in demographics, changes in political and social conditions, regulatory initiatives and changes in customer preferences, many of which are beyond our control and the control of any other person or entity related to this offering. The forward-looking statements made in this free writing prospectus are made as of the date stated on the cover. We have no obligation to update or revise any forward-looking statement.

 

Wells Fargo Securities is the trade name for the capital markets and investment banking services of Wells Fargo & Company and its subsidiaries, including but not limited to Wells Fargo Securities, LLC, a member of NYSE, FINRA, NFA and SIPC, Wells Fargo Prime Services, LLC, a member of FINRA, NFA and SIPC, and Wells Fargo Bank, N.A. Wells Fargo Securities, LLC and Wells Fargo Prime Services, LLC are distinct entities from affiliated banks and thrifts.

 

IMPORTANT NOTICE REGARDING THE OFFERED CERTIFICATES

 

The information herein is preliminary and may be supplemented or amended prior to the time of sale. In addition, the Offered Certificates referred to in these materials and the asset pool backing them 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 described in these materials 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 security or contract discussed in these materials.

 

The information contained herein supersedes any previous such information delivered to any prospective investor and will be superseded by information delivered to such prospective investor prior to the time of sale.

 

IMPORTANT NOTICE RELATING TO AUTOMATICALLY-GENERATED EMAIL DISCLAIMERS

 

Any legends, disclaimers or other notices that may appear at the bottom of any email communication to which this free writing prospectus is attached relating to (1) these materials not constituting an offer (or a solicitation of an offer), (2) any representation that these materials are accurate or complete and may not be updated or (3) these materials possibly being confidential, are not applicable to these materials and should be disregarded. Such legends, disclaimers or other notices have been automatically generated as a result of these materials having been sent via Bloomberg or another system.

 

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.

 

2

 

 

Wells Fargo Commercial Mortgage Trust 2021-C60Certificate Structure

 

I.Certificate Structure

 

 ClassExpected Ratings
(DBRS Morningstar / Fitch/ Moody’s)(1)
Approximate Initial
Certificate Balance or
Notional Amount(2)

Approx. Initial Credit
Support(3)

Pass-Through
Rate Description
Weighted
Average
Life
(Years)(4)
Expected
Principal
Window(4)
Certificate Principal to
Value Ratio(5)
Certificate Principal
U/W NOI
Debt
Yield(6)
 Offered Certificates    
 A-1AAA(sf)/AAA(sf)/Aaa(sf)$17,659,00030.000%(7)2.6208/21 – 06/2641.4%14.2%
 A-2AAA(sf)/AAA(sf)/Aaa(sf)$45,569,00030.000%(7)4.9206/26 – 07/2641.4%14.2%
 A-SBAAA(sf)/AAA(sf)/Aaa(sf)$24,458,00030.000%(7)7.2307/26 – 12/3041.4%14.2%
 A-3(8)AAA(sf)/AAA(sf)/Aaa(sf)(8)(9)30.000%(7)(9)(9)41.4%14.2%
 A-4(8)AAA(sf)/AAA(sf)/Aaa(sf)(8)(9)30.000%(7)(9)(9)41.4%14.2%
 X-AAAA(sf)/AAA(sf)/Aaa(sf)$524,043,000(10)N/AVariable(11)N/AN/AN/AN/A
 X-B(12)AA(sf)/A-(sf)/NR$121,653,000(13)N/AVariable(14)N/AN/AN/AN/A
 A-S(8)AAA(sf)/AAA(sf)/Aa1(sf)$58,019,000(8)22.250%(7)9.9607/31 – 07/3145.9%12.8%
 B(8)AAA(sf)/AA-(sf)/NR $34,624,000(8)17.625%(7)9.9607/31 – 07/3148.7%12.1%
 C(8)(12)AA(low)(sf)/A-(sf)/NR $29,010,000(8)13.750%(7)9.9607/31 – 07/3151.0%11.5%
 Non-Offered Certificates      
 X-D(15)AA(low)(sf)/BBB+(sf)/NR$11,192,000(16)N/AVariable(17)N/AN/AN/AN/A
 D(15)A(high)(sf)/BBB+(sf)/NR$11,192,00012.255%(7)9.9607/31 – 07/3151.9%11.3%
 Risk Retention Certificates      
 E-RR(15)A(low)(sf)/BBB(sf)/NR$14,074,00010.375%(7)9.9607/31 – 07/3153.0%11.1%
 F-RRBBB(high)(sf)/BBB-(sf)/NR$17,780,0008.000%(7)9.9607/31 – 07/3154.4%10.8%
 G-RRBBB(sf)/BB+(sf)/NR$9,358,0006.750%(7)9.9607/31 – 07/3155.1%10.7%
 H-RRBB(high)sf/BB-(sf)/NR$9,358,0005.500%(7)9.9607/31 – 07/3155.8%10.5%
 J-RRBB(high)sf/B-(sf)/NR$7,486,0004.500%(7)9.9607/31 – 07/3156.4%10.4%
 K-RRBB(low)sf/NR/NR$8,422,0003.375%(7)9.9607/31 – 07/3157.1%10.3%
 L-RRB(low)sf/NR/NR$11,230,0001.875%(7)9.9607/31 – 07/3158.0%10.1%
 M-RRNR/NR/NR$14,037,0420.000%(7)9.9607/31 – 07/3159.1%10.0%
Notes:
(1)The expected ratings presented are those of DBRS, Inc. (“DBRS Morningstar”), Fitch Ratings, Inc. (“Fitch”), and Moody’s Investors Service, Inc. (“Moody’s”), which the depositor hired to rate the Offered Certificates.  One or more other nationally recognized statistical rating organizations that were not hired by the depositor may use information they receive pursuant to Rule 17g-5 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise, to rate or provide market reports and/or published commentary related to the Offered Certificates.  We cannot assure you as to what ratings a non-hired nationally recognized statistical rating organization would assign or that its reports will not express differing, possibly negative, views of the mortgage loans and/or the Offered Certificates.  The ratings of each Class of Offered Certificates address the likelihood of the timely distribution of interest and, except in the case of the Class X-A and X-B Certificates, the ultimate distribution of principal due on those Classes on or before the Rated Final Distribution Date.  See “Risk Factors—Other Risks Relating to the Certificates—Nationally Recognized Statistical Rating Organizations May Assign Different Ratings to the Certificates; Ratings of the Certificates Reflect Only the Views of the Applicable Rating Agencies as of the Dates Such Ratings Were Issued; Ratings May Affect ERISA Eligibility; Ratings May Be Downgraded” and “Ratings” in the Preliminary Prospectus, expected to be dated July 12, 2021 (the “Preliminary Prospectus”). DBRS Morningstar, Fitch and Moody’s have informed us that the “sf” designation in their ratings represents an identifier for structured finance product ratings.
(2)The Certificate Balances and Notional Amounts set forth in the table are approximate.  The actual initial Certificate Balances and Notional Amounts may be larger or smaller depending on the initial pool balance of the mortgage loans definitively included in the pool of mortgage loans, which aggregate cut-off date balance may be as much as 5% larger or smaller than the amount presented in the Preliminary Prospectus.  In addition, the Notional Amounts of the Class X-A or X-B Certificates may vary depending upon the final pricing of the Classes of Principal Balance Certificates (as defined below) or trust components whose Certificate Balances comprise such Notional Amounts, and, if, as a result of such pricing, the pass-through rate of the Class X-A or X-B Certificates, as applicable, would be equal to zero at all times, such Class of Certificates may not be issued on the closing date of this securitization.
(3)The approximate initial credit support with respect to the Class A-1, A-2, A-SB, A-3 and A-4 Certificates represents the approximate credit enhancement for the Class A-1, A-2, A-SB, A-3 and A-4 Certificates in the aggregate, taking into account the Certificate Balances of the Class A-3 and Class A-4 trust components. The approximate initial credit support set forth for the Class A-S certificates represents the approximate initial credit enhancement for the underlying Class A-S trust component. The approximate initial credit support set forth for the Class B certificates represents the approximate initial credit enhancement for the underlying Class B trust component. The approximate initial credit support set forth for the Class C certificates represents the approximate initial credit enhancement for the underlying Class C trust component.
(4)Weighted Average Lives and Expected Principal Windows are calculated based on an assumed prepayment rate of 0% CPR and the “Structuring Assumptions” described under “Yield and Maturity Considerations—Weighted Average Life” in the Preliminary Prospectus.
(5)The Certificate Principal to Value Ratio for each Class of Certificates (other than the Class A-1, A-2, A-SB, A-3 and A-4 Certificates) is calculated as the product of (a) the weighted average Cut-off Date LTV Ratio for the mortgage loans and (b) a fraction, the numerator of which is the total initial Certificate Balance of such Class of Certificates and all Classes of Principal Balance Certificates (or, with respect to the Class A-3, A-4, A-S, B or C Certificates, the trust component with the same alphanumeric designation) senior to such Class of Certificates and the denominator of which is the total initial Certificate Balance of all of the Classes of Principal Balance Certificates (or, with respect to the Class A-3, A-4, A-S, B or C Certificates, the trust component with the same alphanumeric designation). The Certificate Principal to Value Ratio for each of the Class A-1, A-2, A-SB, A-3 and A-4 Certificates is calculated in the aggregate for those Classes as if they were a single Class and is calculated as the product of (a) the weighted average Cut-off Date LTV Ratio for the mortgage loans and (b) a fraction, the numerator of which is the total initial Certificate Balance of such Classes of Certificates (or, with respect to the Class A-3 or A-4 Certificates, the trust component with the same alphanumeric designation) and the denominator of which is the total initial Certificate Balance of all of the Classes of Principal Balance Certificates (or, with respect to the Class A-3, A-4, A-S, B or C Certificates, the trust component with the same alphanumeric designation).  In any event, however, excess mortgaged property value associated with a mortgage loan will not be available to offset losses on any other mortgage loan.

 

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.

 

3

 

 

Wells Fargo Commercial Mortgage Trust 2021-C60Certificate Structure

 

(6)The Certificate Principal U/W NOI Debt Yield for each Class of Certificates (other than the Class A-1, A-2, A-SB, A-3 and A-4 Certificates) is calculated as the product of (a) the weighted average U/W NOI Debt Yield for the mortgage loans and (b) a fraction, the numerator of which is the total initial Certificate Balance of all of the Classes of Principal Balance Certificates (or, with respect to the Class A-3, A-4, A-S, B or C Certificates, the trust component with the same alphanumeric designation) and the denominator of which is the total initial Certificate Balance of such Class of Certificates and all Classes of Principal Balance Certificates (or, with respect to the Class A-3, A-4, A-S, B or C Certificates, the trust component with the same alphanumeric designation) senior to such Class of Certificates.  The Certificate Principal U/W NOI Debt Yield for each of the Class A-1, A-2, A-SB, A-3 and A-4 Certificates is calculated in the aggregate for those Classes as if they were a single Class and is calculated as the product of (a) the weighted average U/W NOI Debt Yield for the mortgage loans and (b) a fraction, the numerator of which is the total initial Certificate Balance of all of the Classes of Principal Balance Certificates (or, with respect to the Class A-3, A-4, A-S, B or C Certificates, the trust component with the same alphanumeric designation) and the denominator of which is the total initial Certificate Balance of such Classes of Certificates (or, with respect to the Class A-3 and Class A-4 Certificates, the trust component with the same alphanumeric designation). In any event, however, cash flow from each mortgaged property supports only the related mortgage loan and will not be available to support any other mortgage loan.
(7)The pass-through rates for the Class A-1, A-2, A-SB, A-3, A-4, A-S, B, C, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates in each case for any distribution date will be one of the following: (i) a fixed rate per annum, (ii) a variable rate per annum equal to the weighted average of the net mortgage interest rates on the mortgage loans for the related distribution date, (iii) a variable rate per annum equal to the lesser of (a) a fixed rate and (b) the weighted average of the net mortgage interest rates on the mortgage loans for the related distribution date or (iv) a variable rate per annum equal to the weighted average of the net mortgage interest rates on the mortgage loans for the related distribution date minus a specified percentage. For purposes of the calculation of the weighted average of the net mortgage interest rates on the mortgage loans for each distribution date, the mortgage interest rates will be adjusted as necessary to a 30/360 basis.
(8)

The Class A-3-1, A-3-2, A-3-X1, A-3-X2, A-4-1, A-4-2, A-4-X1, A-4-X2, A-S-1, A-S-2, A-S-X1, A-S-X2, B-1, B-2, B-X1, B-X2, C-1, C-2, C-X1 and C-X2 Certificates are also offered certificates. Such Classes of Certificates, together with the Class A-3, A-4, A-S, B and C Certificates, constitute the “Exchangeable Certificates”. The Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates, together with the Exchangeable Certificates with a Certificate Balance, are referred to as the “Principal Balance Certificates”. Each class of Exchangeable Certificates will have the Certificate Balance or Notional Amount and pass-through rate described below under “Exchangeable Certificates”.

 

(9)

The exact initial Certificate Balances or Notional Amounts of the Class A-3, A-3-X1, A-3-X2, A-4, A-4-X1 and A-4-X2 trust components (and consequently, the exact initial Certificate Balances or Notional Amounts of the Exchangeable Certificates with an “A-3” or “A-4” designation) are unknown and will be determined based on the final pricing of the Certificates. However, the initial Certificate Balances, weighted average lives and principal windows of the Class A-3 and Class A-4 trust components are expected to be within the applicable ranges reflected in the following chart. The aggregate initial Certificate Balance of the Class A-3 and Class A-4 trust components is expected to be approximately $436,357,000, subject to a variance of plus or minus 5%. The Class A-3-X1 and A-3-X2 trust components will have initial Notional Amounts equal to the initial Certificate Balance of the Class A-3 trust component. The Class A-4-X1 and A-4-X2 trust components will have initial Notional Amounts equal to the initial Certificate Balance of the Class A-4 trust component. In the event that the Class A-4 Certificates are issued at $436,357,000, the Class A-3 Certificates will not be issued.

 

Trust Components

 

Expected Range of Approximate
Initial

Certificate Balance

 

Expected Range of
Weighted Average Life (Years)

 

Expected Range of

Principal Window

Class A-3 $0 – $200,000,000 NAP – 9.38 NAP / 01/30 – 05/31
Class A-4 $236,357,000 – $436,357,000 9.65 – 9.88 01/30 – 07/31 / 05/31 – 07/31

 

(10)The Class X-A Certificates are notional amount certificates. The Notional Amount of the Class X-A Certificates will be equal to the aggregate Certificate Balance of the Class A-1, A-2 and A-SB Certificates and the Class A-3 and A-4 trust components outstanding from time to time. The Class X-A Certificates will not be entitled to distributions of principal.
(11)The pass-through rate for the Class X-A Certificates for any distribution date will be a per annum rate equal to the excess, if any, of (a) the weighted average of the net mortgage interest rates on the mortgage loans for the related distribution date, over (b) the weighted average of the pass-through rates on the Class A-1, A-2 and A-SB Certificates and the Class A-3, A-3-X1, A-3-X2, A-4, A-4-X1 and A-4-X2 trust components for the related distribution date, weighted on the basis of their respective Certificate Balances or Notional Amounts outstanding immediately prior to that distribution date (but excluding trust components with a Notional Amount in the denominator of such weighted average calculation). For purposes of the calculation of the weighted average of the net mortgage interest rates on the mortgage loans for each distribution date, the mortgage interest rates will be adjusted as necessary to a 30/360 basis.
(12)

The initial Certificate Balance of each of the Class C, C-X1 and C-X2 trust components are subject to change based on final pricing of all Certificates and the final determination of the Class E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates (collectively, the “horizontal risk retention certificates”) that will be retained by the retaining sponsor through a third party purchaser as part of the U.S. risk retention requirements. For more information regarding the methodology and key inputs and assumptions used to determine the sizing of the horizontal risk retention certificates, see “Credit Risk Retention” in the Preliminary Prospectus. The Class C-X1 and C-X2 trust components will have initial Notional Amounts equal to the initial Certificate Balance of the Class C trust component. Any variation in the initial Certificate Balance of the Class C trust component would affect the initial Notional Amount of the Class X-B Certificates.

(13)The Class X-B Certificates are notional amount certificates. The Notional Amount of the Class X-B Certificates will be equal to the aggregate Certificate Balance of the Class A-S, B and C trust components outstanding from time to time.  The Class X-B Certificates will not be entitled to distributions of principal.
(14)The pass-through rate for the Class X-B Certificates for any distribution date will be a per annum rate equal to the excess, if any, of (a) the weighted average of the net mortgage interest rates on the mortgage loans for the related distribution date, over (b) the weighted average of the pass-through rates on the Class A-S, A-S-X1, A-S-X2, B, B-X1, B-X2, C, C-X1 and C-X2 trust components for the related distribution date, weighted on the basis of their respective Certificate Balances or Notional Amounts outstanding immediately prior to that distribution date (but excluding trust components with a Notional Amount in the denominator of such weighted average calculation). For purposes of the calculation of the weighted average of the net mortgage interest rates on the mortgage loans for each distribution date, the mortgage interest rates will be adjusted as necessary to a 30/360 basis.

 

(15)The initial Notional Amount of the Class X-D Certificates and the initial Certificate Balance of each of the Class D and E-RR Certificates are subject to change based on final pricing of all Certificates and the final determination of the horizontal risk retention certificates that will be retained by the retaining sponsor through a third party purchaser as part of the U.S. risk retention requirements. For more information regarding the methodology and key inputs and assumptions used to determine the sizing of the horizontal risk retention certificates, see “Credit Risk Retention” in the Preliminary Prospectus.
(16)

The Class X-D Certificates are notional amount certificates. The Notional Amount of the Class X-D Certificates will be equal to the Certificate Balance of the Class D Certificates outstanding from time to time. The Class X-D Certificates will not be entitled to distributions of principal.

(17)

The pass-through rate for the Class X-D Certificates for any distribution date will be a per annum rate equal to the excess, if any, of (a) the weighted average of the net mortgage interest rates on the mortgage loans for the related distribution date, over (b) the pass-through rate on the Class D Certificates for the related distribution date. For purposes of the calculation of the weighted average of the net mortgage interest rates on the mortgage loans for each distribution date, the mortgage interest rates will be adjusted as necessary to a 30/360 basis.

 

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.

 

4

 

 

Wells Fargo Commercial Mortgage Trust 2021-C60Transaction Highlights

 

II.       Transaction Highlights

 

Mortgage Loan Sellers:

 

Mortgage Loan Seller Number of
Mortgage
Loans
 Number of
Mortgaged
Properties
 Aggregate Cut-off
Date Balance
 % of Initial
Pool
Balance
LMF Commercial, LLC 24  27  $226,356,953  30.2%
Wells Fargo Bank, National Association 10  23  181,540,000  24.2 
Column Financial, Inc.   4  102,741,723  13.7 
UBS AG   26  89,110,000  11.9 
BSPRT CMBS Finance, LLC 10  10  75,807,589  10.1 
Ladder Capital Finance LLC   17  73,076,778  9.8 

Total 

 61  107  $748,633,043  100.0%

 

Loan Pool:

 

Initial Pool Balance:$748,633,043
Number of Mortgage Loans:61
Average Cut-off Date Balance per Mortgage Loan:$12,272,673
Number of Mortgaged Properties:107
Average Cut-off Date Balance per Mortgaged Property(1):$6,996,570
Weighted Average Mortgage Interest Rate:3.766%
Ten Largest Mortgage Loans as % of Initial Pool Balance:46.5%
Weighted Average Original Term to Maturity or ARD (months):116
Weighted Average Remaining Term to Maturity or ARD (months):114
Weighted Average Original Amortization Term (months)(2):357
Weighted Average Remaining Amortization Term (months)(2):356
Weighted Average Seasoning (months):2

 

(1)Information regarding mortgage loans secured by multiple properties is based on an allocation according to relative appraised values or the allocated loan amounts or property-specific release prices set forth in the related loan documents or such other allocation as the related mortgage loan seller deemed appropriate.

(2)Excludes any mortgage loan that does not amortize.

 

Credit Statistics:

 

Weighted Average U/W Net Cash Flow DSCR(1)(2):2.32x
Weighted Average U/W Net Operating Income Debt Yield(1)(2):10.0%
Weighted Average Cut-off Date Loan-to-Value Ratio(1)(2):59.1%
Weighted Average Balloon or ARD Loan-to-Value Ratio(1)(2):55.3%
% of Mortgage Loans with Additional Subordinate Debt(3):9.4%
% of Mortgage Loans with Single Tenants(4):9.4%

 

(1)With respect to any mortgage loan that is part of a whole loan, loan-to-value ratio, debt service coverage ratio and debt yield calculations include the related pari passu companion loan(s) but exclude any related subordinate companion loan(s) (unless otherwise stated). The debt service coverage ratio, debt yield and loan-to-value ratio information do not take into account any subordinate debt (whether or not secured by the related mortgaged property), that currently exists or is allowed under the terms of any mortgage loan. The information for each mortgaged property that relates to a mortgage loan that is cross-collateralized or cross-defaulted with one or more other mortgage loans is based upon the principal balance of that mortgage loan, except that the applicable loan-to-value ratio, debt service coverage ratio, and debt yield for each such mortgage loan is based upon the ratio or yield (as applicable) for the aggregate indebtedness evidenced by all loans in the group (without regard to any limitation on the amount of indebtedness secured by any mortgaged property in such cross-collateralized group). See “Description of the Mortgage Pool—Mortgage Pool Characteristics” in the Preliminary Prospectus and Annex A-1 to the Preliminary Prospectus.

(2)For certain of the mortgage loans, underwritten net cash flow, underwritten net operating income and appraised values of the related mortgaged properties were determined, or were calculated based on information as of a date, prior to the emergence of the novel coronavirus pandemic and the economic disruption resulting from measures to combat the pandemic, and the loan-to-value, debt service coverage and debt yield metrics presented in this term sheet may not reflect current market conditions.

(3)The percentage figure expressed as “% of Mortgage Loans with Additional Subordinate Debt” is determined as a percentage of the initial pool balance and does not take into account any future subordinate debt (whether or not secured by the mortgaged property), if any, that may be permitted under the terms of any mortgage loan or the pooling and servicing agreement. See “Description of the Mortgage Pool—Additional Indebtedness” in the Preliminary Prospectus.

(4)Excludes mortgage loans that are secured by multiple single tenant 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.

 

5

 

 

Wells Fargo Commercial Mortgage Trust 2021-C60Transaction Highlights

 

Loan Structural Features:

 

Amortization: Based on the Initial Pool Balance, 40.5% of the mortgage pool (32 mortgage loans) has scheduled amortization, as follows:

 

20.7% (15 mortgage loans) provides for an interest-only period followed by an amortization period; and

 

19.8% (17 mortgage loans) requires amortization during the entire loan term.

 

Interest-Only: Based on the Initial Pool Balance, 59.5% of the mortgage pool (29 mortgage loans) provides for interest-only payments during the entire loan term through maturity or ARD. The Weighted Average Cut-off Date Loan-to-Value Ratio and Weighted Average U/W Net Cash Flow DSCR for those mortgage loans are 56.0% and 2.77x, respectively.

 

Hard Lockboxes: Based on the Initial Pool Balance, 35.5% of the mortgage pool (15 mortgage loans) have hard lockboxes in place.

 

Reserves: The mortgage loans require amounts to be escrowed monthly as follows (excluding any mortgage loans with springing provisions):

 

Real Estate Taxes:  72.7% of the pool
Insurance:34.4% of the pool
Capital Replacements:  74.7% of the pool
TI/LC:  49.3% of the pool(1)
(1)The percentage of Initial Pool Balance for mortgage loans with TI/LC reserves is based on the aggregate principal balance allocable to loans that include office, retail, mixed use and industrial properties.

 

Call Protection/Defeasance: Based on the Initial Pool Balance, the mortgage pool has the following call protection and defeasance features:

 

75.8% of the mortgage pool (50 mortgage loans) features a lockout period, then defeasance only until an open period;

 

9.2% of the mortgage pool (5 mortgage loans) features a lockout period, then the greater of a prepayment premium (1.0%) or yield maintenance until an open period;

 

7.8% of the mortgage pool (2 mortgage loans) features a lockout period, then the greater of a prepayment premium (1.0%) or yield maintenance or defeasance until an open period;

 

3.3% of the mortgage pool (1 mortgage loan) features a lockout period, then the greater of a prepayment premium (1.0%) or yield maintenance, then the greater of a prepayment premium (1.0%) or yield maintenance or defeasance until an open period;

 

2.7% of the mortgage pool (1 mortgage loan) features a lockout period, then the greater of a prepayment premium (1.0%) or yield maintenance, then the greater of a prepayment premium (1.0%) or yield maintenance or defeasance, then defeasance until an open period;

 

1.2% of the mortgage pool (1 mortgage loan) features a lockout period, then the greater of a prepayment premium (1.0%) or yield maintenance, then defeasance until an open period; and

 

0.1% of the mortgage pool (1 mortgage loan) features yield maintenance, then yield maintenance or defeasance until an open period.

 

Prepayment restrictions for each mortgage loan reflect the entire life of the mortgage loan. Please refer to Annex A-1 to the Preliminary Prospectus and the footnotes related thereto for further information regarding individual loan call protection.

 

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

 

 

Wells Fargo Commercial Mortgage Trust 2021-C60Transaction Highlights

 

III.       COVID-19 Update

 

The following table contains information regarding the status of the mortgage loans and mortgaged properties provided by the respective borrowers as of the date set forth in the “Information As Of Date” column. The information from the borrowers has not been independently verified by the Mortgage Loan Sellers, the Underwriters or any other party, and there can be no assurance that the status of the Mortgage Loans and of the related Mortgaged Properties has not changed since the date in the “Information As-Of Date” column. The cumulative effects of the COVID-19 emergency on the global economy may cause tenants to be unable to pay their rent and borrowers to be unable to pay debt service under the mortgage loans. As a result, we cannot assure you that the information in the following table is indicative of future performance or that tenants or borrowers will not seek rent or debt service relief (including forbearance arrangements) or other lease or loan modifications in the future. Such actions may lead to shortfalls and losses on the certificates. Any information in the following table will be superseded by the information contained under the heading “Description of the Mortgage Pool—COVID-19 Considerations” in the Preliminary Prospectus.

 

Mortgage Loan Seller

Information As Of Date

Origination Date

Mortgaged Property Name

Mortgaged Property Type

April

Debt Service Payment Received (Y/N)

May Debt Service Payment Received (Y/N)

June Debt Service Payment Received (Y/N)

Forbearance or Other Debt Service Relief Requested (Y/N)

Other Loan Modification Requested (Y/N)

Lease Modification or Rent Relief Requested (Y/N)

Total SF or Unit Count Making Full May Rent Payment (%)

UW May Base Rent Paid (%)

Total SF or Unit Count Making Full June Rent Payment (%)

UW June Base Rent Paid (%)

WFB6/29/20216/28/2021Velocity Industrial PortfolioIndustrialNAP(4)NAP(4)NAP(4)NNN100.0%100.0%100.0%100.0%
Column6/24/202111/17/2020The Grace Building(1)OfficeYYYNNY97.0%97.0%95.5%94.0%
LMF6/30/20215/6/2021Malibu Colony PlazaRetailNAP(2)NAP(2)YNNY(3)93.9%(3)83.0%(3)93.9%(3)97.5%(2)
UBS AG6/25/20216/30/2021Mason Multifamily PortfolioMultifamilyNAP(4)NAP(4)NAP(4)NNN94.8%92.2%95.6%94.7%
WFB6/22/20216/11/2021Gramercy PlazaOfficeNAP(5)NAP(5)NAP(5)NNY(6)100.0%100.0%100.0%100.0%
Column6/21/202111/24/2020Bell Towne Centre(7)RetailYYYNNN98.2%98.3%98.2%98.3%
UBS AG6/24/20215/13/2021Rollins PortfolioVariousNAP(5)NAP(5)NAP(5)NNN100.0%100.0%100.0%100.0%
LMF6/30/20216/3/20211010 Building and Heinen’s Rotunda BuildingMixed UseNAP(4)NAP(4)NAP(4)NNN98.9%99.7%93.3%96.9%
LCF7/2/20216/30/20212302 WebsterMultifamilyNAP(4)NAP(4)NAP(4)NNNNAVNAV100%100%
LMF6/14/20216/25/2021The Wyatt at Northern LightsMultifamilyNAP(4)NAP(4)NAP(4)NNN100.0%100.0%96.7%98.6%
LCF6/30/20217/1/2021Trader Joe’s LICRetailNAP(4)NAP(4)NAP(4)NNN100%100%100%100%
Column6/21/20211/21/2021The Westchester(8)RetailYYYNNYNAVNAVNAVNAV
WFB6/28/20216/17/2021Metro CrossingRetailNAP(4)NAP(4)NAP(4)NNY(12)100.0%100.0%100.0%100.0%
WFB6/28/20216/4/2021ExchangeRight 47VariousNAP(5)NAP(5)NAP(5)NNN100.0%100.0%100.0%100.0%
BSPRT7/2/20214/5/2021Seacrest HomesMultifamilyNAP(24)YYNNN100.0%100.0%100.0%100.0%
LMF6/22/20216/18/2021Ranch Self StorageSelf StorageNAP(4)NAP(4)NAP(4)NNN(9)(9)(9)(9)
UBS AG6/25/20216/25/2021Elmwood Distribution CenterIndustrialNAP(4)NAP(4)NAP(4)NNY(10)97.0%99.1%98.8%99.8%
BSPRT7/2/20213/24/2021Herndon SquareOfficeNAP(24)YYNNN100.0%100.0%100.0%100.0%
WFB6/18/20216/29/2021The Plaza at Williams CentreRetailNAP(4)NAP(4)NAP(4)NNY(11)100.0%102.3%100.0%102.3%
BSPRT7/2/20216/30/2021Lafayette Arms ApartmentsMultifamilyNAP(4)NAP(4)NAP(4)NNN94.0%NAV97.0%NAV
LMF6/22/20216/25/2021231 Hudson Leased FeeOtherNAP(4)NAP(4)NAP(4)NNY(26)100.0%100.0%100.0%100.0%
LCF7/2/20217/2/2021The Woodlands of CharlottesvilleMultifamilyNAP(4)NAP(4)NAP(4)NNNNAVNAV98.6%98.6%
LMF6/21/20215/26/2021884 Riverside DriveMultifamilyNAP(5)NAP(5)NAP(5)NNN100.0%100.0%84.7%92.9%
WFB6/24/20215/10/2021Securlock HAC Self-Storage PortfolioSelf StorageNAP(2)NAP(2)YNNNN/A98.7%N/A98.7%
LMF6/30/20212/20/2020TownePlace Suites - La PlaceHospitalityYYYY(13)NN(14)(14)(14)(14)
WFB6/28/20216/7/2021Envy Self Storage and RVSelf StorageNAP(5)NAP(5)NAP(5)NNNN/A99.9%N/AN/A
LMF6/24/20215/25/2021Interstate Self StorageSelf StorageNAP(5)NAP(5)NAP(5)NNN(12)(12)(12)(12)
LCF7/2/20213/11/2020122nd Street PortfolioMultifamilyYYYNNN100%100%91.7%91.7%
LMF6/25/20216/17/2021Heights MarketplaceRetailNAP(4)NAP(4)NAP(4)NNY(15)100.0%100.0%100.0%100.0%
WFB6/13/20216/29/2021TownePlace Suites The VillagesHospitalityNAP(4)NAP(4)NAP(4)NNN(23)(23)(23)(23)
UBS AG6/25/20216/15/2021Garver Little RockOfficeNAP(4)NAP(4)NAP(4)NNN100.0%100.0%100.0%100.0%
BSPRT7/2/20215/7/2021Home2Suites Hilton HeadHospitalityNAP(5)NAP(5)NAP(5)NNN(25)(25)(25)(25)
LMF6/28/20216/18/2021Lowy Bronx Multifamily PortfolioMultifamilyNAP(4)NAP(4)NAP(4)NNN93.2%93.2%86.4%85.3%
LMF6/21/20213/5/2021Arizona PavilionsRetailYYYNNY(16)100.0%100.0%100.0%100.0%
LMF6/30/20216/24/2021Boonton IndustrialIndustrialNAP(4)NAP(4)NAP(4)NNN(17)(17)(17)(17)
Column6/23/20215/19/2021Leisure LivingManufactured HousingNAP(5)NAP(5)NAP(5)NNN100.0%100.0%100.0%100.0%
BSPRT7/2/20215/18/2021Walmart DelandOtherNAP(5)NAP(5)NAP(5)NNN100.0%100.0%100.0%100.0%
LMF6/30/20215/14/2021Bronxwood Mixed UseMixed UseNAP(5)NAP(5)NAP(5)NNY(18)80.5%83.7%74.8%76.3%
LMF6/23/20214/22/2021Lost River Self StorageSelf StorageNAP(2)NAP(2)YNNN(19)(19)(19)(19)
LMF6/18/20214/28/2021Clara Point ApartmentsMultifamilyNAP(2)NAP(2)YNNN100.0%100.0%100.0%100.0%
LCF6/30/20214/22/2021Belamere Suites IIHospitalityNAP(2)NAP(2)YNNN100%100%100%100%
WFB7/2/20216/1/2021AC Self Storage - Missouri CitySelf StorageNAP(5)NAP(5)NAP(5)NNN99.6%99.4%99.1%98.6%
WFB7/2/20215/27/2021AC Self Storage – Arlington, TXSelf StorageNAP(5)NAP(5)NAP(5)NNN99.3%99.4%99.2%99.2%
BSPRT7/2/20213/31/2021Walgreens – Newport News, VARetailNAP(24)YYNNN100.0%100.0%100.0%100.0%
BSPRT7/2/20215/24/2021Walgreens San Tan ValleyRetailNAP(5)NAP(5)NAP(5)NNN100.0%100.0%100.0%100.0%
LMF6/30/20214/19/2021Amidon Place ApartmentsMultifamilyNAP(2)NAP(2)YNNN98.2%96.3%92.9%91.1%
LMF6/30/20214/29/2021Estrella CrossroadsRetailNAP(2)NAP(2)YNNY(20)(27)(27)(27)(27)
LCF6/30/202112/12/2019Federales ChicagoRetailYYYNNN100.0%100.0%100.0%100.0%
LMF6/24/20215/3/2021Shops at Valle VistaRetailNAP(2)NAP(2)YNNY(21)100.0%100.0%100.0%100.0%
LMF6/9/20216/25/2021Villas at the WoodlandsMultifamilyNAP(4)NAP(4)NAP(4)NNN98.4%99.4%90.5%89.8%
UBS AG6/25/20216/30/2021Turtle Creek ApartmentsMultifamilyNAP(4)NAP(4)NAP(4)NNN92.8%94.6%91.2%93.1%
BSPRT7/2/20215/3/2021FleetPride IndustrialIndustrialNAP(2)NAP(2)YNNN100.0%100.0%100.0%100.0%
LMF6/30/20215/4/2021Walgreens CambridgeRetailNAP(2)NAP(2)YNNN100.0%100.0%100.0%100.0%
BSPRT7/2/20215/7/2021Parq on 8th ApartmentsMultifamilyNAP(5)NAP(5)NAP(5)NNN95.1%95.1%95.1%95.1%
LMF6/24/20214/14/2021Lord Duplin ApartmentsMultifamilyNAP(2)NAP(2)YNNN100.0%100.0%100.0%100.0%
LMF6/15/20216/15/2021Oak Hill & City Walk MHC PortfolioManufactured HousingNAP(4)NAP(4)NAP(4)NNN96.3%97.7%78.5%(22)83.4%(22)
LMF6/24/20216/7/20214070 Butler Pike OfficeOfficeNAP(5)NAP(5)NAP(5)NNN100.0%100.0%100.0%100.0%
BSPRT7/2/20215/6/20217-Eleven TampaRetailNAP(2)NAP(2)YNNN100.0%100.0%100.0%100.0%
LMF6/30/20215/11/2021CVS Mars HillRetailNAP(2)NAP(2)YNNN100.0%100.0%100.0%100.0%
UBS AG6/25/20216/25/20215800 BrookhollowIndustrialNAP(4)NAP(4)NAP(4)NNN100.0%100.0%100.0%100.0%
LCF6/30/20216/29/2021Dollar General-Siginaw (E. Washington Road)RetailNAP(4)NAP(4)NAP(4)NNN100.0%100.0%100.0%100.0%
               

 

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.

 

7

 

 

Wells Fargo Commercial Mortgage Trust 2021-C60Transaction Highlights

 

 
(1)With respect to The Grace Building Mortgage Loan, four (4) retail tenants, representing 1.8% of net rentable area and 2.5% of underwritten base rent, have not made rent payments for the past several months. The borrower sponsor is in the process of negotiating rent deferrals with full rental payments anticipated to commence in late 2021 or early 2022. The parking tenant has not paid the required monthly rental payments since March 2020 and an event of default is continuing under the lease. The borrower sponsor is in the process of replacing the current operator and plans to employ a new operator under a management agreement. The borrower deposited $1,608,940 with the lender at origination for anticipated parking rent shortfalls.

(2)The related Mortgage Loans have their first due date in June 2021.

(3)With respect to the Malibu Colony Plaza Mortgaged Property, eight tenants totaling 16,630 square feet (14.5% of net rentable area and 36.8% of underwritten base rent) received rent deferral. The guarantors of the Malibu Colony Plaza Mortgage Loan signed master leases for a term of 10 years for each of these seven spaces, agreeing to pay any shortfalls for rent not paid by any of these tenants for the term of the Malibu Colony Plaza Mortgage Loan.

(4)The related Mortgage Loans have their first due date in August 2021.

(5)The related Mortgage Loans have their first due date in July 2021.

(6)With respect to the Gramercy Plaza Mortgage Loan, one (1) tenant, representing 0.8% of net rentable area and 0.8% of underwritten base rent, received a three month rent deferral.

(7)With respect to the Bell Towne Centre Mortgage Loan, the borrower sponsor had granted various rent relief/rent deferrals to select tenants in relation to spring and early summer payments due. All tenants are current on rent with the exception of Sylvan Learning (1.6% of net rentable area).

(8)With respect to The Westchester Mortgage Loan, as of December 1, 2020 all stores have reopened including the Nordstrom and Neiman Marcus anchors. The borrower sponsor had granted various rent relief/rent deferrals to select tenants in relation to spring and early summer payments due. Short term rent relief was given to several tenants in exchange for waiving co-tenancy provisions in their lease through December 2021. Rent deferrals are expected to be paid back in equal monthly installments starting in 2021, with a few tenants electing to make one lump sum payment. The Westchester Mortgaged Property is 92.2% as of May 11, 2021 occupied. The sponsor collected 84% to 86% of tenant rents monthly from October 2020 through January 2021 and since their portfolio has returned to pre-COVID property collections they are no longer tracking monthly collections.

(9)With respect to the Ranch Self Storage Mortgage Loan, as of June 22, 2021, 0.8% of underwritten base rents were 31-60 days overdue, 0.1% of underwritten base rents were 61-90 days overdue and 0.1% of underwritten base rents were 91-120 days overdue.

(10)With respect to the Elmwood Distribution Center Mortgage Loan, according to the borrower sponsor, six (6) tenants, representing 8.1% of net rentable area and 10.8% of underwritten base rent, were granted rent deferrals, including Tiffany & Co Dance Studio, The Leather Factory LP, Triumph Fitness LLC, V Solar Nails, Pioneer Wine & Spirits of LA and Coleman American Moving Srvcs. Tiffany & Co received three months of rent deferral for the months of May, June and July 2020, with the six-month rent payback period beginning October 2020. The Leather Factory received three months of rent deferral for the months of April, May and June 2020, with the six-month rent payback period beginning October 2020. Triumph received two months of rent deferral for the months of May and June 2020, with the six-month rent payback period beginning December 2020. V Solar Nails (no longer in occupancy) received three months of rent deferral for the months of April, May and June 2020, with the nine-month rent payback period beginning October 2020. LA Spirit Cheer received three months of rent deferral for the months of April, May and June 2020, with the nine-month rent payback period beginning October 2020. Coleman Moving received three months of rent deferral for the months of April, May and June 2020, with the nine-month rent payback period beginning October 2020. The Sponsor confirmed that the six (6) tenants who received rent deferrals are all current on their respective payback schedules. Tiffany & Co has already paid back all deferred rent ahead of their expected rent payback schedule (paid back by November 2020).

(11)With respect to The Plaza at Williams Centre Mortgage Loan, 11 tenants, representing 25.1% of net rentable area and 29.4% of underwritten base rent, received rent deferral or modification.

(12)With respect to the Metro Crossing Mortgage Loan, 18 tenants, representing 33.3% of net rentable area and 39.9% of underwritten base rent requested and received rent relief.

(13)With respect to the TownePlace Suites - La Place Mortgaged Property, the borrower received forbearance which deferred interest payments for six months from April through October 2020 (the total amount deferred was $209,300). The borrower is required to pay $209,300 in monthly installments of $16,852.22, starting January 2021. The borrower is current on its repayments.

(14)With respect to the TownePlace Suites - La Place Mortgaged Property, for the trailing 12 months as of May 31, 2021, occupancy, ADR and RevPAR information was 54.9%, $100.42 and $55.11, respectively.

(15)With respect to the Heights Marketplace Mortgaged Property, six (6) tenants deferred rent. Lovett Dental (approximately 14.7% of the net rentable area) deferred base rent for April 2020, which was repaid in full from September to December 2020. Citrus Nail Spa (approximately 12.7% of net rentable area) deferred base rent for May 2020, which was repaid in full from June to August 2020. Smashburger (approximately 12.1% of the net rentable area) deferred rent from April through June 2020, extended its lease for an additional three years and agreed to pay an additional $775.25 per month for the remainder of its lease term. Jimmy John’s (approximately 7.3% of the net rentable area) deferred rent for April and May 2020, which was repaid in full by February 2021. The Joint (approximately 5.2% of the net rentable area) deferred rent for April 2020, which was repaid in May 2020. Aqua Cleaners (approximately 4.5% of the net rentable area) deferred full rent in April and May 2020 and partial rent in June, July and December 2020 and January 2021, which deferred rent was repaid in full by May 2021.

(16)With respect to the Arizona Pavilions Mortgaged Property, two (2) tenants deferred rent. Mattress Firm (approximately 16.4% of the net rentable area) was late on approximately three months of rent in 2020, however all amounts due were repaid in 2020 and Mattress Firm executed its second renewal option in December 2020. Sport Clips (approximately 4.5% of the net rentable area) deferred 50% of its rent from June through December 2020, repayment of which was included in an executed lease extension.

(17)With respect to the Boonton Industrial Mortgage Loan, the lease between the Boonton Industrial borrower and J. Supor Realty LLC commenced on June 24, 2021.

(18)With respect to the Bronxwood Mixed Use Mortgaged Property, Michael Angelo Studio (approximately 12.0% of the net rentable area) is delinquent on approximately one year of rent. The tenant recently extended its lease for five years to 2026. One year of rent totaling $35,400 was reserved at loan origination, which will be released to the borrower when Michael Angelo Studio pays 12 consecutive months of full unabated rent.

(19)With respect to the Lost River Self Storage Mortgage Loan, as of June 23, 2021, 3.3% of underwritten base rents were 31-60 days overdue, 0.8% of underwritten base rents were 61-90 days overdue and 0.7% of underwritten base rents were 91-120 days overdue.

(20)With respect to the Estrella Crossroads Mortgaged Property, three (3) leases were amended in 2020. Pretty Nails & Spa (approximately 9.6% of the net rentable area) received free rent in April, May and June 2020. The borrower waived payment of the April, May and June 2020 rent upon tenant’s execution of a lease modification that extended its lease for five years. Sammy’s Burgers (approximately 7.9% of the net rentable area) received free rent in July 2020. The borrower waived payment of the July 2020 rent upon tenant’s execution of a lease modification that extended its lease for five years. Subway (approximately 5.7% of the net rentable area) received a rent abatement of base rent in April and May 2020. The borrower waived payment of the April and May 2020 rent upon tenant’s execution of a lease modification that extended its lease for four months.

(21)With respect to the Shops at Valle Vista Mortgaged Property, three (3) tenants deferred rent. Freddy’s Frozen Custard (approximately 23.1% of the net rentable area) deferred 50% of rent for May, June and July 2020, which is required to be repaid in monthly installments of $1,186.72 from January 2021 through December 2021. Visionworks (approximately 20.4% of the net rentable area) deferred base rent in May and June 2020, which is required to be repaid in monthly installments of $158.13 from July 2020 through November 2028. All-Star Nutrition (approximately 9.1% of the net rentable area) deferred rent in May 2020 . The borrower waived payment of the May 2020 rent upon tenant’s execution of a lease modification extending the lease term for one additional month.

(22)With respect to the Oak Hill & City Walk MHC Portfolio, the borrower acquired the properties on June 15, 2021 and is in the process of transitioning to a new payment system. As such, the reported numbers are as-of June 15, 2021 and do not include a full month of collections.

(23)With respect to the TownePlace Suites The Villages mortgage loan, the May 2021 occupancy, ADR and RevPAR information was 79.7%, $100.76 and $80.28. Occupancy, ADR and RevPAR information is due to the lender 30 days after month’s end; therefore, June 2021 information is not yet available.

(24)The related Mortgage Loans have their first due date in May 2021.

(25)With respect to the Home2Suites Hilton Head Mortgage Loan, the May 2021 occupancy, ADR and RevPAR information was 66.1%, $162.11 and $107.17. Occupancy, ADR and RevPAR information for June 2021 is not yet available.

(26)With respect to the 231 Hudson Leased Fee Mortgaged Property, the borrower and the tenant entered into a lease modification agreement dated April 8, 2020, pursuant to which rents were deferred by $25,000 per month for April 2020 and May 2020. Deferred rent totaling $50,000 has been paid back in full in monthly installments of $4,166.66, in addition to base rent, from June 2020 through May 2021.

(27)With respect to the Estrella Crossroads Mortgage Loan, the sponsor acquired the Mortgaged Property in April 2021. Five tenants (representing 35.0% of the net rentable area and 41.5% of underwritten base rent) have made rent payments due in May and June 2021. Three tenants (Walgreens, Firestone and JP Morgan Chase, collectively representing 65.0% of net rentable area and 58.5% of underwritten base rent) encountered administrative delays in redirecting their rental payments to the sponsor (as new landlord) following the sponsor’s acquisition of the property. The lender has reviewed correspondence between the sponsor and the three respective tenants and all outstanding rental payments are anticipated to be fully paid in July 2021. The borrower is fully current on principal and interest payments due under the mortgage loan.

 

See “Risk Factors—Risks Related to Market Conditions and Other External Factors—The Coronavirus Pandemic Has Adversely Affected the Global Economy and Will Likely Adversely Affect the Performance of the Mortgage Loans” 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.

 

8

 

 

Wells Fargo Commercial Mortgage Trust 2021-C60Issue Characteristics

 

IV.Issue Characteristics

 

Securities Offered:$645,696,000 approximate monthly pay, multi-class, commercial mortgage REMIC pass-through certificates consisting of thirty classes (Classes A-1, A-2, A-SB, A-3, A-3-1, A-3-2, A-3-X1, A-3-X2, A-4, A-4-1, A-4-2, A-4-X1, A-4-X2, A-S, A-S-1, A-S-2, A-S-X1, A-S-X2, B, B-1, B-2, B-X1, B-X2, C, C-1, C-2, C-X1, C-X2, X-A and X-B), which are offered pursuant to a registration statement filed with the SEC (such classes of certificates, the “Offered Certificates”).
Mortgage Loan Sellers:LMF Commercial, LLC (“LMF”), Wells Fargo Bank, National Association (“WFB”), Column Financial, Inc. (“Column”), UBS AG, by and through its branch office at 1285 Avenue of the Americas, New York, New York (“UBS”), BSPRT CMBS Finance, LLC (“BSPRT”) and Ladder Capital Finance LLC (“LCF”)
Joint Bookrunners and Co-Lead Managers:Wells Fargo Securities, LLC, UBS Securities LLC and Credit Suisse Securities (USA) LLC
Co-Managers:Academy Securities, Inc., Drexel Hamilton, LLC and Siebert Williams Shank & Co., LLC
Rating Agencies:DBRS, Inc., Fitch Ratings, Inc., and Moody’s Investors Service, Inc.
Master Servicer:Wells Fargo Bank, National Association
Special Servicer:Midland Loan Services, a Division of PNC Bank, National Association
Certificate Administrator:Wells Fargo Bank, National Association
Trustee:Wilmington Trust, National Association
Operating Advisor:Pentalpha Surveillance LLC
Asset Representations Reviewer:Pentalpha Surveillance LLC
Initial Majority Controlling Class Certificateholder:KKR Real Estate Credit Opportunity Partners II L.P.
U.S. Credit Risk Retention:

For a discussion on the manner in which the U.S. credit risk retention requirements will be satisfied by Wells Fargo Bank, National Association, as the retaining sponsor, see “Credit Risk Retention” in the Preliminary Prospectus.

 

This transaction is being structured with a “third party purchaser” that will acquire an “eligible horizontal residual interest”, which will be comprised of the Class E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates (the “horizontal risk retention certificates”). KKR CMBS II Aggregator Type 2 L.P. (in satisfaction of the retention obligations of Wells Fargo Bank, National Association, as the retaining sponsor) will be contractually obligated to retain (or to cause its “majority-owned affiliate” to retain) the horizontal risk retention certificates for a minimum of five years after the closing date, subject to certain permitted exceptions provided for under the risk retention rules. During this time, KKR CMBS II Aggregator Type 2 L.P. will agree to comply with hedging, transfer and financing restrictions that are applicable to third party purchasers under the credit risk retention rules. For additional information, see “Credit Risk Retention” in the Preliminary Prospectus.

 

EU/UK Credit Risk Retention

None of the sponsors, the depositor, the underwriters, or their respective affiliates, or any other party to the transaction intends to retain a material net economic interest in the securitization constituted by the issue of the Certificates, or take any other action in respect of such securitization, in a manner prescribed or contemplated by (i) Regulation (EU) 2017/2402, or (ii) such Regulation as it forms part of UK domestic law. In particular, no such person undertakes to take any action which may be required by any investor for the purposes of its compliance with any applicable requirement under either such Regulation. Furthermore, the arrangements described under “Credit Risk Retention” in the Preliminary Prospectus have not been structured with the objective of ensuring compliance by any person with any requirements of either such Regulation. See “Risk Factors—Other Risks Relating to the Certificates—EU Securitization Regulation and UK Securitization Regulation Due Diligence Requirements” in the Preliminary Prospectus.

 

Cut-off Date:The Cut-off Date with respect to each mortgage loan is the payment due date for the monthly debt service payment that is due in July 2021 (or, in the case of any mortgage loan that has its first payment due date in August 2021, the date that would have been its payment due date in July 2021 under the terms of that mortgage loan if a monthly debt service payment were scheduled to be due in that month).

 

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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Wells Fargo Commercial Mortgage Trust 2021-C60Issue Characteristics

 

Expected Closing Date:On or about July 29, 2021.
Determination Dates:The 11th day of each month (or if that day is not a business day, the next succeeding business day), commencing in August 2021.
Distribution Dates:The 4th business day following the Determination Date in each month, commencing in August 2021.
Rated Final Distribution Date:The Distribution Date in August 2054.
Interest Accrual Period:With respect to any Distribution Date, the calendar month immediately preceding the month in which such Distribution Date occurs.
Day Count:The Offered Certificates will accrue interest on a 30/360 basis.
Minimum Denominations:$10,000 for each Class of Offered Certificates (other than the Class X-A and X-B Certificates) and $1,000,000 for the Class X-A and X-B Certificates. Investments may also be made in any whole dollar denomination in excess of the applicable minimum denomination.
Clean-up Call:1.0%
Delivery:DTC, Euroclear and Clearstream Banking
ERISA/SMMEA Status:Each Class of Offered Certificates is expected to be eligible for exemptive relief under ERISA.  No Class of Offered Certificates will be SMMEA eligible.
Risk Factors:THE CERTIFICATES INVOLVE CERTAIN RISKS AND MAY NOT BE SUITABLE FOR ALL INVESTORS.  SEE THE “RISK FACTORS” SECTION OF THE PRELIMINARY PROSPECTUS.
Bond Analytics Information:

The Certificate Administrator will be authorized to make distribution date statements, CREFC® reports and certain supplemental reports (other than confidential information) available to certain financial modeling and data provision services, including Bloomberg, L.P., Trepp, LLC, Intex Solutions, Inc., Interactive Data Corp., Markit Group Limited, BlackRock Financial Management, Inc., CMBS.com, Inc., Moody’s Analytics, Inc., Morningstar Credit Information & Analytics, LLC, KBRA Analytics, LLC, MBS Data, LLC, Thomson Reuters Corporation and RealINSIGHT.

Tax TreatmentFor U.S. federal income tax purposes, the issuing entity will consist of two or more REMICs arranged in a tiered structure and a trust (the “grantor trust”). The upper-most REMIC will issue REMIC regular interests some of which will be held by the grantor trust (such grantor trust-held REMIC regular interests, the “trust components”). The Offered Certificates (other than the Exchangeable Certificates) will represent REMIC regular interests (other than the trust components). The Exchangeable Certificates will represent beneficial ownership of one or more of the trust components held by the grantor trust.

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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Wells Fargo Commercial Mortgage Trust 2021-C60Characteristics of the Mortgage Pool

 

V.Characteristics of the Mortgage Pool(1)

 

A.Ten Largest Mortgage Loans

 

Mortgage Loan
Seller
Mortgage Loan NameCityStateNumber of Mortgage Loans / Mortgaged PropertiesMortgage Loan Cut-off Date Balance ($)% of
Initial
Pool Balance (%)
Property
Type
Number
of SF/
Units
Cut-off
Date
Balance
Per
SF/Unit
Cut-off
Date LTV
Ratio
(%)
Balloon
or ARD LTV
Ratio
(%)
U/W NCF
DSCR
(x)
U/W NOI
Debt
Yield (%)
WFBVelocity Industrial PortfolioLansdalePA1 / 2$65,000,0008.7%Industrial1,130,782$6657.8%57.8%2.72x9.4%
ColumnThe Grace BuildingNew YorkNY1 / 150,000,0006.7   Office1,556,97256741.1   41.1   4.25  11.8  
LMFMalibu Colony PlazaMalibuCA1 / 148,000,0006.4   Retail114,37042050.5   50.5   2.10  8.1  
UBS AGMason Multifamily PortfolioDeKalbIL1 / 837,000,0004.9   Multifamily62659,10571.6   65.1   1.51  9.2  
WFBGramercy PlazaTorranceCA1 / 127,200,0003.6   Office157,00817360.4   60.4   3.39  11.5  
ColumnBell Towne CentrePhoenixAZ1 / 126,600,0003.6   Retail130,71320462.6   50.6   1.89  11.2  
UBS AGRollins PortfolioVariousCA1 / 1424,400,0003.3   Industrial232,34017065.4   65.4   2.94  9.6  
LMF1010 Building and Heinen’s Rotunda BuildingClevelandOH1 / 124,250,0003.2   Mixed Use138,51517557.0   46.5   1.38  8.8  
LCF2302 WebsterBronxNY1 / 123,200,0003.1   Multifamily71326,76166.7   66.7   1.72  7.2  
LMFThe Wyatt at Northern LightsMinotND1 / 122,750,0003.0   Multifamily27682,42863.7   63.7   1.94  8.8  
Top Three Total/Weighted Average  3 / 4$163,000,00021.8%   50.5%50.5%3.01x9.8%
Top Five Total/Weighted Average  5 / 13$227,200,00030.3%   55.1%54.1%2.81x9.9%
Top Ten Total/Weighted Average  10 / 31$348,400,00046.5%   57.9%55.5%2.52x9.6%
Non-Top Ten Total/Weighted Average  51 / 76$400,233,04353.5%   60.1%55.0%2.15x10.2%
(1)With respect to any mortgage loan that is part of a whole loan, Cut-off Date Balance Per SF/Unit, loan-to-value ratio, debt service coverage ratio and debt yield calculations include the related pari passu companion loan(s) (unless otherwise stated). With respect to each mortgage loan, debt service coverage ratio, debt yield and loan-to-value ratio information do not take into account subordinate debt (whether or not secured by the related mortgaged property), if any, that currently exists or is allowed under the terms of such mortgage loan.

 

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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Wells Fargo Commercial Mortgage Trust 2021-C60Characteristics of the Mortgage Pool

 

B.Summary of the Whole Loans

 

No.Loan Name

Mortgage

Loan Seller in WFCM 2020-C58

Trust Cut-off Date BalanceAggregate Pari
Passu Companion  Loan Cut-off Date Balance(1)
Controlling Pooling/Trust & Servicing
Agreement
Master ServicerSpecial ServicerRelated Pari Passu Companion Loan(s) SecuritizationsRelated Pari Passu Companion Loan(s) Original Balance
1Velocity Industrial PortfolioWFB$65,000,000

$75,000,000

 

WFCM 2021-C60Wells Fargo Bank, National AssociationMidland Loan Services, a Division of PNC Bank National AssociationFuture Securitization(s)$10,000,000
2The Grace BuildingColumn$50,000,000$883,000,000GRACE 2020-GRCE(2)Wells Fargo Bank, National AssociationSitus Holdings, LLCGRACE 2020-GRCE$383,000,000
 BANK 2020-BNK29$75,000,000
 BANK 2020-BNK30$60,000,000
 BMARK 2020-B21$100,000,000
 BMARK 2020-B22$80,000,000
 BMARK 2020-B23$60,000,000
 CSAIL 2021-C20$60,000,000
 BANK 2021-BNK33$15,000,000
7Rollins PortfolioUBS AG$24,400,000$39,400,000WFCM 2021-C60Wells Fargo Bank, National AssociationMidland Loan Services, a Division of PNC Bank National AssociationFuture Securitization(s)$15,000,000
12The WestchesterColumn$20,000,000$343,000,000CSMC 2020-WEST(2)Midland Loan Services, a Division of PNC Bank National AssociationPacific Life Insurance CompanyCSMC 2020-WEST$193,000,000
      CSAIL 2020-C19$50,000,000
      CSAIL 2021-C20$35,000,000
      Future Securitization(s)$45,000,000
13Metro CrossingWFB$20,000,000$34,450,000WFCM 2021-C60Wells Fargo Bank, National AssociationMidland Loan Services, a Division of PNC Bank National AssociationFuture Securitization(s)$14,450,000
15Seacrest HomesBSPRT$18,000,000$48,000,000WFCM 2021-C59Wells Fargo Bank, National AssociationArgentic Services Company LPWFCM 2021-C59$30,000,000
18Herndon SquareBSPRT$14,936,855$30,371,606WFCM 2021-C59Wells Fargo Bank, National AssociationArgentic Services Company LPWFCM 2021-C59$15,434,751
28122nd Street PortfolioLCF$8,000,000$23,000,000WFCM 2020-C57Wells Fargo Bank, National AssociationMidland Loan Services, a Division of PNC Bank National AssociationWFCM 2020-C57$15,000,000
(1)The Aggregate Pari Passu Companion Loan Cut-off Date Balance excludes any related Subordinate Companion Loans.

(2)Control rights are currently exercised by the holder of the related Subordinate Companion Loan until the occurrence and during the continuation of a control appraisal period for the related whole loan, as described under “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced AB Whole Loans—The Grace Building Whole Loan” and “—The Westchester 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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Wells Fargo Commercial Mortgage Trust 2021-C60Characteristics of the Mortgage Pool

 

C.Mortgage Loans with Additional Secured and Mezzanine Financing

 

Loan No.Mortgage Loan SellerMortgage Loan NameMortgage
Loan
Cut-off Date
Balance ($)
% of Initial Pool
Balance (%)
Sub Debt Cut-off Date Balance ($)Mezzanine Debt Cut-off Date
Balance ($)
Total Debt Interest
Rate (%)(1)
Mortgage Loan U/W NCF DSCR (x)(2)Total Debt U/W NCF DSCR (x)Mortgage
Loan Cut-off Date U/W NOI Debt Yield (%)(2)
Total Debt Cut-off Date
U/W NOI Debt Yield (%)
Mortgage
Loan Cut-off Date LTV
Ratio (%)(2)
Total Debt Cut-off Date LTV Ratio (%)
1WFBVelocity Industrial Portfolio$65,000,0008.7%NAP$10,000,0004.0265%2.72x1.929.4%8.3%57.8%65.5%
 Total/Weighted Average$65,000,0008.7%$0$10,000,0004.0265%2.72x1.92x9.4%8.3%57.8%65.5%
(1)Total Debt Interest Rate for any specified mortgage loan reflects the weighted average of the interest rates on the respective components of the total debt.

(2)With respect to any mortgage loan that is part of a whole loan, the loan-to-value ratio, debt service coverage ratio and debt yield calculations include the related pari passu companion loan(s) but excludes any related subordinate companion loan.

 

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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Wells Fargo Commercial Mortgage Trust 2021-C60Characteristics of the Mortgage Pool

 

D.Previous Securitization History(1)

 

Loan
No.
Mortgage Loan SellerMortgage
Loan or Mortgaged
Property Name
CityStateProperty
Type
Mortgage Loan
or Mortgaged Property Cut-off Date Balance ($)
% of
Initial Pool Balance
(%)
Previous Securitization
3LMFMalibu Colony PlazaMalibuCARetail$48,000,000 6.4%DBUBS 2011-LC2A
4UBS AGMason Multifamily PortfolioDeKalbILMultifamily37,000,0004.9 GSMS 2014-GC22
7UBS AGRollins PortfolioVariousCAIndustrial24,400,0003.3 WMCMS 2007-SL3
10LMFThe Wyatt at Northern LightsMinotNDMultifamily22,750,0003.0 FREMF 2018-K731
19WFBThe Plaza at Williams CentreTucsonAZRetail14,000,0001.9 CSFB 2005-C5
24WFBSecurlock HAC Self-Storage PortfolioVariousVariousSelf Storage9,000,0001.2 WFRBS 2014-C24
Total     $155,150,00020.7% 

(1)The table above represents the most recent securitization with respect to the mortgaged property securing the related mortgage loan, based on information provided by the related borrower or obtained through searches of a third-party database. While loans secured by the above mortgaged properties may have been securitized multiple times in prior transactions, mortgage loans in this securitization are only listed in the above chart if the mortgage loan paid off a loan in another securitization. The information has not otherwise been confirmed by the mortgage loan sellers.

 

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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Wells Fargo Commercial Mortgage Trust 2021-C60Characteristics of the Mortgage Pool

 

E.Mortgage Loans with Scheduled Balloon Payments and Related Classes

 

Class A-2(1)
Loan No.Mortgage Loan SellerMortgage Loan NameStateProperty TypeMortgage
Loan Cut-off Date Balance ($)
% of Initial Pool
Balance (%)
Mortgage
Loan Balance at Maturity or ARD($)
% of Class A-2 Certificate Principal
Balance (%)(2)
SF / RoomLoan per
SF / Room
($)
U/W NCF DSCR
(x)
U/W NOI Debt Yield (%)Cut-off Date LTV Ratio (%)Balloon or ARD
LTV Ratio (%)
Rem. IO Period (mos.)Rem. Term to Maturity or ARD (mos.)
13WFBMetro CrossingIARetail$20,000,000  2.7%$17,983,81239.5%310,130$1112.05x12.0%64.2%57.7%060
14WFBExchangeRight 47VariousVarious20,000,0002.7  20,000,00043.9%210,447953.63  10.8   53.0   53.0   5959
30WFBTownePlace Suites The VillagesFLHospitality7,500,0001.0  6,854,20515.0%11963,0252.45  16.3   45.7   41.8   060
Total/Weighted Average  $47,500,0006.3%$44,838,01798.4%  2.78x12.2%56.6%53.2%2560
                 
(1)The table above presents the mortgage loan(s) whose balloon payments would be applied to pay down the principal balance of the Class A-2 Certificates, assuming a 0% CPR and applying the “Structuring Assumptions” described in the Preliminary Prospectus, including the assumptions that (i) none of the mortgage loans in the pool experience prepayments prior to maturity (or in the case of an ARD loan, its anticipated repayment date), defaults or losses; (ii) there are no extensions of maturity dates of any mortgage loans in the pool; and (iii) each mortgage loan in the pool is paid in full on its stated maturity date (or in the case of an ARD loan, its anticipated repayment date). Each Class of Certificates evidences undivided ownership interests in the entire pool of mortgage loans. Debt service coverage ratio, debt yield and loan-to-value ratio information do not take into account subordinate debt (whether or not secured by the related mortgaged property), if any, that currently exists or is allowed under the terms of any mortgage loan. See Annex A-1 to the Preliminary Prospectus.

(2)Reflects the percentage equal to the Balloon Balance divided by the initial Class A-2 Certificate Balance.

 

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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Wells Fargo Commercial Mortgage Trust 2021-C60Characteristics of the Mortgage Pool

 

F.Property Type Distribution(1)

 

 

Property Type Number of
Mortgaged
Properties
 Aggregate
Cut-off Date
Balance ($)
 % of Initial
Pool
Balance (%)
 Weighted
Average
Cut-off Date
LTV Ratio (%)
 Weighted
Average
Balloon LTV
Ratio (%)
 Weighted
Average
U/W NCF
DSCR (x)
 Weighted
Average
U/W NOI
Debt Yield (%)
 Weighted
Average
U/W NCF
Debt Yield (%)
 Weighted
Average
Mortgage
Rate (%)
Retail 27 $213,069,272 28.5% 58.9% 55.0% 2.22x 9.8% 9.5% 3.684%
Anchored 3 72,600,000 9.7  54.9  52.8  2.09  9.4  9.0  3.640 
Unanchored 3 42,300,000 5.7  66.6  60.2  1.69  8.7  8.5  3.806 
Single Tenant 17 41,339,470 5.5  58.5  58.5  2.68  9.5  9.4  3.696 
Shadow Anchored 3 36,829,802 4.9  61.4  50.5  1.82  11.1  10.2  3.853 
Super-Regional Mall 1 20,000,000 2.7  53.0  53.0  3.61  12.3  11.9  3.250 
Multifamily 34 172,065,653 23.0  65.9  61.7  1.74  8.6  8.3  4.035 
Garden 16 94,556,653 12.6  68.3  62.6  1.69  9.1  8.7  4.114 
Mid Rise 18 77,509,000 10.4  63.0  60.5  1.79  8.0  7.9  3.937 
Industrial 20 116,329,705 15.5  57.6  56.5  2.89  10.1  9.6  3.299 
Warehouse 3 71,500,000 9.6  58.7  57.6  2.63  9.5  9.1  3.382 
Flex 14 24,400,000 3.3  65.4  65.4  2.94  9.6  9.6  3.210 
Warehouse Distribution 2 17,000,000 2.3  40.5  40.5  4.20  13.4  12.1  2.850 
Warehouse / Distribution 1 3,429,705 0.5  63.5  49.4  1.44  9.7  9.1  4.430 
Office 6 103,336,103 13.8  51.7  49.5  3.53  11.5  11.1  3.107 
Suburban 4 51,893,515 6.9  61.9  57.4  2.83  11.3  10.7  3.512 
CBD 1 50,000,000 6.7  41.1  41.1  4.25  11.8  11.6  2.692 
Medical 1 1,442,588 0.2  53.0  53.0  3.63  10.8  10.7  2.900 
Self Storage 9 58,540,000 7.8  60.5  57.4  1.99  9.0  8.8  4.161 
Self Storage 9 58,540,000 7.8  60.5  57.4  1.99  9.0  8.8  4.161 
Mixed Use 2 30,250,000 4.0  58.6  49.1  1.39  8.8  8.6  4.621 
Multifamily/Retail/Office 1 24,250,000 3.2  57.0  46.5  1.38  8.8  8.6  4.680 
Multifamily/Retail 1 6,000,000 0.8  65.2  59.7  1.42  8.7  8.5  4.383 
Hospitality 4 29,025,586 3.9  54.8  45.5  2.12  16.2  14.5  5.139 
Extended Stay 3 23,445,866 3.1  57.8  49.4  2.07  14.3  12.8  4.680 
Limited Service 1 5,579,720 0.7  42.3  29.1  2.32  24.1  21.8  7.068 
Other 2 16,750,000 2.2  50.7  44.7  1.99  9.8  9.8  3.652 
Leased Fee 2 16,750,000 2.2  50.7  44.7  1.99  9.8  9.8  3.652 
Manufactured Housing 3 9,266,723 1.2  59.5  49.6  1.37  8.4  8.3  4.491 
Manufactured Housing 3 9,266,723 1.2  59.5  49.6  1.37  8.4  8.3  4.491 
Total/Weighted Average: 107 $748,633,043 100.0% 59.1% 55.3% 2.32x 10.0% 9.6% 3.766%
(1)Because this table presents information relating to the mortgaged properties and not the mortgage loans, (a) the information for mortgage loans secured by more than one mortgaged property (other than through cross-collateralization with other mortgage loans) is based on allocated loan amounts (allocating the principal balance of the mortgage loan to each of those properties according to the relative appraised values of the mortgaged properties or the allocated loan amounts or property-specific release prices set forth in the related mortgage loan documents or such other allocation as the related mortgage loan seller deemed appropriate) and (b) the information each mortgaged property that relates to a mortgage loan that is cross-collateralized or cross-defaulted with other mortgage loans is based upon the principal balance of that mortgage loan, except that the applicable loan-to-value ratio, debt service coverage ratio and debt yield for each such mortgage loan is based upon the ratio or yield (as applicable) for the aggregate indebtedness evidenced by all loans in the group (without regard to any limitation on the amount of indebtedness secured by any mortgaged property in such cross-collateralized group). On an individual basis, without regard to the cross-collateralization feature, any mortgage loan that is part of a cross-collateralized group of mortgage loans may have a higher loan-to-value ratio, lower debt service coverage ratio and/or lower debt yield than is presented herein. With respect to any mortgage loan that is part of a whole loan, the loan-to-value ratio, debt service coverage ratio and debt yield calculations include the related pari passu companion loan(s) but exclude any related subordinate secured loan(s) (unless otherwise stated). With respect to each mortgage loan, debt service coverage ratio, debt yield and loan-to-value ratio information do not take into account any subordinate debt (whether or not secured by the related mortgaged property) that currently exists or is allowed under the terms of such mortgage loan. See Annex A-1 to 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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Wells Fargo Commercial Mortgage Trust 2021-C60Characteristics of the Mortgage Pool

 

G.Geographic Distribution(1)(2)

 

 

Location Number of Mortgaged Properties Aggregate
Cut-off Date
Balance ($)
 % of Initial
Pool
Balance (%)
 Weighted
Average
Cut-off Date
LTV Ratio (%)
 Weighted
Average
Balloon or ARD
LTV Ratio (%)
 Weighted
Average
U/W NCF
DSCR (x)
 Weighted
Average
U/W NOI
Debt Yield (%)
 Weighted
Average
U/W NCF
Debt Yield (%)
 

Weighted
Average
Mortgage
Rate (%)

New York 21 $155,509,000  20.8% 54.4% 53.1% 2.76x 9.7% 9.6% 3.417%
California 19 135,425,908  18.1  57.4  56.8  2.44  9.2  9.1  3.706 
Southern California 4 109,700,000  14.7  55.7  54.9  2.32  9.1  9.0  3.827 
Northern California 15 25,725,908  3.4  64.8  64.8  2.98  9.7  9.7  3.194 
Arizona 7 69,229,802  9.2  60.3  51.4  1.99  10.5  9.9  3.700 
Pennsylvania 4 68,907,426  9.2  57.7  57.3  2.70  9.5  9.0  3.266 
Illinois 9 41,500,000  5.5  70.3  64.5  1.53  9.1  8.6  4.061 
Other(3) 47 278,060,906  37.1  60.9  54.8  2.12  10.6  10.0  4.087 
Total/Weighted Average 107 $748,633,043  100.0% 59.1% 55.3% 2.32x 10.0% 9.6% 3.766%
(1)The mortgaged properties are located in 25 states.

(2)Because this table presents information relating to the mortgaged properties and not the mortgage loans, (a) the information for mortgage loans secured by more than one mortgaged property (other than through cross-collateralization with other mortgage loans) is based on allocated amounts (allocating the principal balance of the mortgage loan to each of those properties according to the relative appraised values of the mortgaged properties or the allocated loan amounts or property-specific release prices set forth in the related mortgage loan documents or such other allocation as the related mortgage loan seller deemed appropriate) and (b) the information for each mortgaged property that relates to a mortgage loan that is cross-collateralized or cross-defaulted with other mortgage loans is based upon the principal balance of that mortgage loan, except that the applicable loan-to-value ratio, debt service coverage ratio and debt yield for each such mortgage loan is based upon the ratio or yield (as applicable) for the aggregate indebtedness evidenced by all loans in the group (without regard to any limitation on the amount of indebtedness secured by any mortgaged property in such cross-collateralized group). On an individual basis, without regard to the cross-collateralization feature, any mortgage loan that is part of a cross-collateralized group of mortgage loans may have a higher loan-to-value ratio, lower debt service coverage ratio and/or lower debt yield than is presented herein. With respect to any mortgage loan that is part of a whole loan, the loan-to-value ratio, debt service coverage ratio and debt yield calculations include the related pari passu companion loan(s) but exclude any related subordinate secured loan(s) (unless otherwise stated). With respect to each mortgage loan, debt service coverage ratio, debt yield and loan-to-value ratio information do not take into account any subordinate debt (whether or not secured by the related mortgaged property) that currently exists or is allowed under the terms of such mortgage loan. See Annex A-1 to the Preliminary Prospectus.

(3)Includes 20 other states.

 

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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Wells Fargo Commercial Mortgage Trust 2021-C60Characteristics of the Mortgage Pool

 

H.Characteristics of the Mortgage Pool(1)

 

CUT-OFF DATE BALANCE
Range of Cut-off Date
Balances ($)
 Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
847,058 - 1,000,000 1 $847,058 0.1%
1,000,001 - 2,000,000 1 2,000,000 0.3 
2,000,001 - 3,000,000 3 6,721,660 0.9 
3,000,001 - 4,000,000 8 27,083,858 3.6 
4,000,001 - 5,000,000 4 18,537,500 2.5 
5,000,001 - 6,000,000 7 39,239,720 5.2 
6,000,001 - 7,000,000 5 31,995,525 4.3 
7,000,001 - 8,000,000 5 37,821,875 5.1 
8,000,001 - 10,000,000 4 34,323,991 4.6 
10,000,001 - 15,000,000 7 86,861,855 11.6 
15,000,001 - 20,000,000 5 94,500,000 12.6 
20,000,001 - 30,000,000 7 168,700,000 22.5 
30,000,001 - 50,000,000 3 135,000,000 18.0 
50,000,001 - 65,000,000 1 65,000,000 8.7 
Total: 61 $748,633,043 100.0%
Average $12,272,673     
UNDERWRITTEN NOI DEBT SERVICE COVERAGE RATIO
Range of U/W NOI
DSCRs (x)
 Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
1.28 - 1.30 2 $27,075,000 3.6%
1.31 - 1.40 5 26,916,723 3.6 
1.41 - 1.50 5 47,594,153 6.4 
1.51 - 1.60 1 3,429,705 0.5 
1.61 - 1.70 5 81,369,802 10.9 
1.71 - 1.80 6 46,109,160 6.2 
1.81 - 1.90 4 19,570,000 2.6 
1.91 - 2.00 3 35,998,731 4.8 
2.01 - 2.50 16 197,030,049 26.3 
2.51 - 3.00 5 107,779,720 14.4 
3.01 - 3.50 3 41,500,000 5.5 
3.51 - 4.00 3 47,260,000 6.3 
4.01 - 6.32 3 67,000,000 8.9 
Total: 61 $748,633,043 100.0%
Weighted Average 2.41x    
UNDERWRITTEN NCF DEBT SERVICE COVERAGE RATIO

Range of U/W NCF

DSCRs (x)

 Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
1.27 - 1.30 2 $27,075,000 3.6%
1.31 - 1.40 8 62,510,876 8.4 
1.41 - 1.50 3 15,429,705 2.1 
1.51 - 1.60 4 51,482,302 6.9 
1.61 - 1.70 5 47,358,535 6.3 
1.71 - 1.80 5 54,296,855 7.3 
1.81 - 1.90 5 45,960,000 6.1 
1.91 - 2.00 2 36,750,000 4.9 
2.01 - 2.50 15 157,309,769 21.0 
2.51 - 3.00 4 100,000,000 13.4 
3.01 - 3.50 3 43,460,000 5.8 
3.51 - 4.00 3 55,000,000 7.3 
4.01 - 5.82 2 52,000,000 6.9 
Total: 61 $748,633,043 100.0%
Weighted Average 2.32x    
LOAN PURPOSE
Loan Purpose Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
Refinance 36 $544,229,627 72.7%
Acquisition 24 201,059,263 26.9 
Recapitalization 1 3,344,153 0.4 
Total: 61 $748,633,043 100.0%
MORTGAGE RATE

Range of Mortgage  

Rates (%) 

 Number of
Mortgage

Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
2.692 - 3.500 15 $295,160,000 39.4%
3.501 - 3.750 6 113,600,000 15.2 
3.751 - 4.000 9 121,611,500 16.2 
4.001 - 4.250 6 33,321,855 4.5 
4.251 - 4.500 10 65,365,146 8.7 
4.501 - 4.750 9 71,363,144 9.5 
4.751 - 5.000 4 35,569,802 4.8 
5.001 - 7.068 2 12,641,595 1.7 
Total: 61 $748,633,043 100.0%
Weighted Average 3.766%     
UNDERWRITTEN NOI DEBT YIELD

Range of U/W NOI 

Debt Yields (%) 

 Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
6.9 - 8.0 6 $72,875,000 9.7%
8.1 - 9.0 19 211,100,723 28.2 
9.1 - 10.0 12 172,014,263 23.0 
10.1 - 11.0 8 68,910,615 9.2 
11.1 - 12.0 8 153,106,855 20.5 
12.1 - 13.0 4 46,661,875 6.2 
13.1 - 14.0 1 8,883,991 1.2 
14.1 - 17.0 1 7,500,000 1.0 
17.1 - 19.0 1 2,000,000 0.3 
19.1 - 24.1 1 5,579,720 0.7 
Total: 61 $748,633,043 100.0%
Weighted Average 10.0%     
UNDERWRITTEN NCF DEBT YIELD

Range of U/W NCF

Debt Yields (%)

 Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
6.8 - 8.0 9 $135,025,000 18.0%
8.1 - 9.0 19 255,638,223 34.1 
9.1 - 10.0 13 91,404,431 12.2 
10.1 - 11.0 10 118,739,802 15.9 
11.1 - 12.0 6 123,861,875 16.5 
12.1 - 14.0 1 8,883,991 1.2 
14.1 - 16.0 1 7,500,000 1.0 
16.1 - 20.0 1 2,000,000 0.3 
20.1 - 21.8 1 5,579,720 0.7 
Total: 61 $748,633,043 100.0%
Weighted Average 9.6%     
ORIGINAL TERM TO MATURITY OR ARD
Original Term to
Maturity or ARD (months)
 Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
60 3 $47,500,000 6.3%
120 58 701,133,043 93.7 
Total: 61 $748,633,043 100.0%
Weighted Average 116 months     

 

(1)The information for each mortgaged property that relates to a mortgage loan that is cross-collateralized or cross-defaulted with one or more other mortgage loans is based upon the principal balance of that mortgage loan, except that the applicable loan-to-value ratio, debt service coverage ratio, and debt yield for each such mortgage loan is based upon the ratio or yield (as applicable) for the aggregate indebtedness evidenced by all loans in the group (without regard to any limitation on the amount of indebtedness secured by any mortgaged property in such cross-collateralized group). With respect to any mortgage loan that is part of a whole loan, the loan-to-value ratio, debt service coverage ratio and debt yield calculations include the related pari passu companion loan(s) but exclude any related subordinate debt (unless otherwise stated). With respect to each mortgage loan, debt service coverage ratio, debt yield and loan-to-value ratio information do not take into account any subordinate debt (whether or not secured by the related mortgaged property) that currently exists or is allowed under the terms of such mortgage loan. See Annex A-1 to the Preliminary Prospectus. Prepayment provisions for each mortgage loan reflects the entire life of the loan (from origination to maturity or ARD) and may be currently prepayable.

 

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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Wells Fargo Commercial Mortgage Trust 2021-C60Characteristics of the Mortgage Pool

 

REMAINING TERM TO MATURITY OR ARD
Range of Remaining Terms to
Maturity or ARD (months)
 Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
59 - 60 3 $47,500,000 6.3%
61 - 120 58 701,133,043 93.7 
Total: 61 $748,633,043 100.0%
Weighted Average 114 months     
ORIGINAL AMORTIZATION TERM(2)
Original
Amortization Terms
(months)
 Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
Non-amortizing 29 $445,166,058 59.5%
240 1 5,579,720 0.7 
300 1 3,344,153 0.4 
330 1 3,429,705 0.5 
360 29 291,113,407 38.9 
Total: 61 $748,633,043 100.0%
Weighted Average(3) 357 months     

(2)   The original amortization term shown for any mortgage loan that is interest-only for part of its term does not include the number of months in its interest-only period and reflects only the number of months as of the commencement of amortization remaining from the end of such interest-only period.

(3)   Excludes the non-amortizing mortgage loans.

REMAINING AMORTIZATION TERM(4)
Range of Remaining
Amortization Terms
(months)
 Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 

Percent by

Aggregate
Cut-off Date
Pool Balance
(%)

Non-amortizing 29 $445,166,058 59.5%
238 - 240 1 5,579,720 0.7 
241 - 300 1 3,344,153 0.4 
301 - 360 30 294,543,112 39.3 
Total: 61 $748,633,043 100.0%
Weighted Average(5) 356 months     

(4)   The remaining amortization term shown for any mortgage loan that is interest-only for part of its term does not include the number of months in its interest-only period and reflects only the number of months as of the commencement of amortization remaining from the end of such interest-only period.

(5)   Excludes the non-amortizing mortgage loans.

LOCKBOXES
Type of Lockbox Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
Springing 44 $447,424,389 59.8%
Hard/Springing Cash Management 12 193,099,720 25.8 
Hard/In Place Cash Management 3 72,908,933 9.7 
Soft/Springing Cash Management 2 35,200,000 4.7 
Total: 61 $748,633,043 100.0%
PREPAYMENT PROVISION SUMMARY(6)
Prepayment Provision Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
Lockout / Defeasance / Open 50 $567,361,994 75.8%
Lockout / GRTR 1% or YM / Open 5 68,900,000 9.2 
Lockout / GRTR 1% or YM or Defeasance / Open 2 58,240,000 7.8 
Lockout / GRTR 1% or YM / GRTR 1% or YM or D / Open 1 24,400,000 3.3 
Lockout / GRTR 1% or YM / GRTR 1% or YM or D / Defeasance / Open 1 20,000,000 2.7 
Lockout / GRTR 1% or YM / Defeasance / Open 1 8,883,991 1.2 
YM / YM or D / Open 1 847,058 0.1 
Total: 61 $748,633,043 100.0%

(6)   As a result of property releases or the application of funds in a performance reserve, partial principal prepayments could occur during a period that voluntary principal prepayments are otherwise prohibited.

CUT-OFF DATE LOAN-TO-VALUE RATIO
Range of Cut-off Date LTV
Ratios (%)
 Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
28.2 - 40.0 1 $2,000,000 0.3%
40.1 - 45.0 4 81,279,720 10.9 
45.1 - 50.0 2 15,740,000 2.1 
50.1 - 55.0 7 124,385,000 16.6 
55.1 - 60.0 10 126,764,213 16.9 
60.1 - 65.0 15 164,889,705 22.0 
65.1 - 70.0 16 173,261,904 23.1 
70.1 - 74.4 6 60,312,500 8.1 
Total: 61 $748,633,043 100.0%
Weighted Average 59.1%     
BALLOON OR ARD LOAN-TO-VALUE RATIO
Range of Balloon or ARD LTV
Ratios (%)
 Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
28.2 - 30.0 2 $7,579,720 1.0%
30.1 - 35.0 1 10,700,000 1.4 
35.1 - 45.0 4 75,844,153 10.1 
45.1 - 50.0 7 58,189,765 7.8 
50.1 - 55.0 12 188,021,855 25.1 
55.1 - 60.0 14 158,293,991 21.1 
60.1 - 65.0 13 129,062,500 17.2 
65.1 - 68.1 8 120,941,058 16.2 
Total: 61 $748,633,043 100.0%
Weighted Average 55.3%     
AMORTIZATION TYPE
Amortization Type Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
Interest Only 27 $437,059,000 58.4%
Interest Only, Amortizing Balloon 15 155,122,500 20.7 
Amortizing Balloon 17 148,344,485 19.8 
Interest Only - ARD 2 8,107,058 1.1 
Total: 61 $748,633,043 100.0%
ORIGINAL TERM OF INTEREST-ONLY PERIOD FOR PARTIAL IO LOANS
IO Term (months) Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
12 3 $43,550,000 5.8%
24 1 6,000,000 0.8 
36 4 19,037,500 2.5 
60 7 86,535,000 11.6 
Total: 15 $155,122,500 20.7%
Weighted Average 42 months     
SEASONING
Seasoning (months) Number of
Mortgage
Loans
 Aggregate
Cut-off Date
Balance
 Percent by
Aggregate
Cut-off Date
Pool Balance
(%)
0 23 $339,266,058 45.3%
1 15 145,059,411 19.4 
2 13 101,706,925 13.6 
3 3 38,046,855 5.1 
4 1 6,569,802 0.9 
7 2 76,600,000 10.2 
15 1 8,000,000 1.1 
16 1 8,883,991 1.2 
17 1 20,000,000 2.7 
18 1 4,500,000 0.6 
Total: 61 $748,633,043 100.0%
Weighted Average 2 months     

 

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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Wells Fargo Commercial Mortgage Trust 2021-C60

Certain Terms and Conditions

  

VI.       Certain Terms and Conditions

 

Interest Entitlements: The interest entitlement of each Class of Certificates or trust component on each Distribution Date generally will be the interest accrued during the related Interest Accrual Period on the related Certificate Balance or Notional Amount at the related pass-through rate, net of any prepayment interest shortfalls allocated to that Class or trust component for such Distribution Date as described below.  If prepayment interest shortfalls arise from voluntary prepayments (without Master Servicer consent) on particular non-specially serviced loans during any collection period, the Master Servicer is required to make a compensating interest payment to offset those shortfalls, generally up to an amount equal to the portion of its master servicing fees that accrue at 0.25 basis points per annum.  The remaining amount of prepayment interest shortfalls will be allocated to reduce the interest entitlement on all Classes of Certificates (other than the Exchangeable Certificates) and trust components that are entitled to interest, on a pro rata basis, based on their respective amounts of accrued interest for the related Distribution Date.  For any Distribution Date, prepayment interest shortfalls allocated to a trust component will be allocated amongst the related Classes of Exchangeable Certificates, pro rata, in accordance with their respective interest accrual amounts for that distribution date.  If a Class or trust component receives less than the entirety of its interest entitlement on any Distribution Date, then the shortfall (excluding any shortfall due to prepayment interest shortfalls), together with interest thereon, will be added to its interest entitlement for the next succeeding Distribution Date.
   
Principal Distribution Amount: The Principal Distribution Amount for each Distribution Date generally will be the aggregate amount of principal received or advanced in respect of the mortgage loans, net of any non-recoverable advances and interest thereon and workout-delayed reimbursement amounts that are reimbursed to the Master Servicer, the Special Servicer or the Trustee during the related collection period.  Non-recoverable advances and interest thereon are reimbursable from principal collections and advances before reimbursement from other amounts.  Workout-delayed reimbursement amounts are reimbursable from principal collections.  
   
Subordination, Allocation of Losses and Certain Expenses The chart below describes the manner in which the payment rights of certain Classes of Certificates will be senior or subordinate, as the case may be, to the payment rights of other Classes of Certificates. The chart also shows the corresponding entitlement to receive principal and/or interest of certain Classes of Certificates (other than excess interest that accrues on each mortgage loan that has an anticipated repayment date) on any distribution date in descending order. It also shows the manner in which losses are allocated to certain Classes of Certificates in ascending order (beginning with the Non-Offered Certificates, other than the Class V and Class R Certificates) to reduce the Certificate Balance of each such Class to zero; provided that no principal payments or mortgage loan losses will be allocated to the Class X-A, X-B, X-D, V or R Certificates, although principal payments and losses may reduce the Notional Amounts of the Class X-A, X-B and X-D Certificates and, therefore, the amount of interest they accrue.
   
   

 

(1)The maximum certificate balances of Class A-3, Class A-4, Class A-S, Class B and Class C certificates (subject to the constraint on the aggregate initial principal balance of the Class A-3 and Class A-4 trust components discussed in footnote (9) to the table under

 

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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Wells Fargo Commercial Mortgage Trust 2021-C60

Certain Terms and Conditions

  

“Certificate Structure”) will be issued on the closing date, and the certificate balance or notional amount of each other class of Exchangeable Certificates will be equal to zero on the closing date.  The relative priorities of the Exchangeable Certificates are described more fully under ”Exchangeable Certificates”.

(2)The Class X‑A, X-B and X‑D Certificates are interest-only certificates.

(3)Non-Offered Certificates.

 

Distributions: On each Distribution Date, funds available for distribution from the mortgage loans, net of specified trust fees, expenses and reimbursements will generally be distributed in the following amounts and order of priority (in each case to the extent of remaining available funds):

 

  1.   Class A-1, A-2, A-SB, X-A, X-B and X-D Certificates and the Class A-3, A-3-X1, A-3-X2, A-4, A-4-X1 and A-4-X2 trust components: To interest on the Class A-1, A-2, A-SB, X-A and X-B Certificates and the Class A-3, A-3-X1, A-3-X2, A-4, A-4-X1 and A-4-X2 trust components, pro rata, according to their respective interest entitlements.
   
  2.  Class A-1, A-2 and A-SB Certificates and the Class A-3 and A-4 trust components: To principal on the Class A-1, A-2 and A-SB Certificates and the Class A-3 and A-4 trust components in the following amounts and order of priority: (i) first, to principal on the Class A-SB Certificates, in an amount up to the Principal Distribution Amount for such Distribution Date until their Certificate Balance is reduced to the Class A-SB Planned Principal Balance for such Distribution Date; (ii) second, to principal on the Class A-1 Certificates until their Certificate Balance is reduced to zero, up to the remainder of the Principal Distribution Amount for such Distribution Date; (iii) third, to principal on the Class A-2 Certificates until their Certificate Balance is reduced to zero, up to the remainder of the Principal Distribution Amount for such Distribution Date;  (iv) fourth, to principal on the Class A-3 trust component until its Certificate Balance is reduced to zero, up to the remainder of the Principal Distribution Amount for such Distribution Date; (v) fifth, to principal on the Class A-4 trust component until its Certificate Balance is reduced to zero, up to the remainder of the Principal Distribution Amount for such Distribution Date; and (vi) sixth, to principal on the Class A-SB Certificates until their Certificate Balance is reduced to zero, up to the remainder of the Principal Distribution Amount for such Distribution Date.  However, if the Certificate Balance of each Class of Principal Balance Certificates, other than the Class A-1, A-2 and A-SB Certificates and the Class A-3 and A-4 trust components, has been reduced to zero as a result of the allocation of mortgage loan losses and expenses and any of the Class A-1, A-2 and A-SB Certificates and the Class A-3 and A-4 trust components remains outstanding, then the Principal Distribution Amount will be distributed to the Class A-1, A-2 and A-SB Certificates and the Class A-3 and A-4 trust components remaining outstanding, pro rata, based on their respective outstanding Certificate Balances, until their Certificate Balances have been reduced to zero.
   
  3.Class A-1, A-2 and A-SB Certificates and the Class A-3 and A-4 trust components: To reimburse the holders of the Class A-1, A-2 and A-SB Certificates and the Class A-3 and A-4 trust components, pro rata, on the basis of previously allocated unreimbursed losses, for any previously unreimbursed losses (plus interest thereon) on the mortgage loans that were previously allocated in reduction of the Certificate Balances of such Classes or trust components.
   
  4.       Class A-S, A-S-X1 and A-S-X2 trust components: To make distributions on the Class A-S, A-S-X1 and A-S-X2 trust components as follows: (a) first, to interest on the Class A-S, A-S-X1 and A-S-X2 trust components, pro rata, according to their respective interest entitlements; (b) next, to the extent of the portion of the Principal Distribution Amount remaining after distributions in respect of principal to each Class with a higher distribution priority (in this case, the Class A-1, A-2 and A-SB Certificates and the Class A-3 and A-4 trust components), to principal on the Class A-S trust component until its Certificate Balance is reduced to zero; and (c) next, to reimburse the holders of the Class A-S trust component for any previously unreimbursed losses (plus interest thereon) on the mortgage loans that were previously allocated to that trust component in reduction of their Certificate Balance.
   
  5.       Class B, B-X1, B-X2 trust components: To make distributions on the Class B, B-X1 and B-X2 trust components as follows: (a) first, to interest on the Class B, B-X1 and B-X2 trust components, pro rata, according to their respective interest entitlements; (b) next, to the extent of the portion of the Principal Distribution Amount remaining after distributions in respect of principal to each Class with a higher distribution priority (in this case, the Class A-1, A-2 and A-SB Certificates and the Class A-3, A-4 and A-S trust components), to principal on the Class B trust component until its Certificate Balance is

 

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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 reduced to zero; and (c) next, to reimburse the holders of the Class B trust component for any previously unreimbursed losses (plus interest thereon) on the mortgage loans that were previously allocated to that trust component in reduction of their Certificate Balance.

 

 6.Class C, C-X1, C-X2 trust components: To make distributions on the Class C, C-X1 and C-X2 trust components as follows: (a) first, to interest on the Class C, C-X1 and C-X2 trust components, pro rata, according to their respective interest entitlements; (b) next, to the extent of the portion of the Principal Distribution Amount remaining after distributions in respect of principal to each Class with a higher distribution priority (in this case, the Class A-1, A-2 and A-SB Certificates and the Class A-3, A-4, A-S and B trust components), to principal on the Class C trust component until its Certificate Balance is reduced to zero; and (c) next, to reimburse the holders of the Class C trust component for any previously unreimbursed losses (plus interest thereon) on the mortgage loans that were previously allocated to that trust component in reduction of their Certificate Balance.

 

 7.Class D Certificates: To make distributions on the Class D Certificates as follows: (a) first, to interest on the Class D Certificates in the amount of the interest entitlement for that Class; (b) next, to the extent of the portion of the Principal Distribution Amount remaining after distributions in respect of principal to each Class with a higher distribution priority (in this case, the Class A-1, A-2 and A-SB Certificates and the Class A-3, A-4, A-S, B and C trust components), to principal on the Class D Certificates until their Certificate Balance is reduced to zero; and (c) next, to reimburse the holders of the Class D Certificates for any previously unreimbursed losses (plus interest thereon) on the mortgage loans that were previously allocated to that Class in reduction of their Certificate Balance.

 

 8.

After the Class A-1, A-2, A-SB and D Certificates and the Class A-3, A-4, A-S, B and C trust components are paid all amounts to which they are entitled, the remaining funds available for distribution will be used to pay interest, principal and loss reimbursement amounts on the Class E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates sequentially in that order in a manner analogous to the Class D Certificates.  

 

  

Principal and interest payable on the Class A-3, A-3-X1, A-3-X2, A-4, A-4-X1, A-4-X2, A-S, A-S-X1, A-S-X2, B, B-X1, B-X2, C, C-X1 and C-X2 trust components will be distributed pro rata to the corresponding classes of Exchangeable Certificates representing interests therein in accordance with their Class Percentage Interests therein as described below under “Exchangeable Certificates”.

 

Exchangeable Certificates: 

Each class of Exchangeable Certificates may be exchanged for the corresponding classes of Exchangeable Certificates set forth next to such class in the table below, and vice versa.  Following any exchange of one or more classes of Exchangeable Certificates (the applicable “Surrendered Classes”) for one or more classes of other Exchangeable Certificates (the applicable “Received Classes”), the Class Percentage Interests (as defined below) of the outstanding principal balances or notional amounts of the Corresponding Trust Components that are represented by the Surrendered Classes (and consequently their related certificate balances or notional amounts) will be decreased, and those of the Received Classes (and consequently their related certificate balances or notional amounts) will be increased.  The dollar denomination of each of the Received Classes of certificates must be equal to the dollar denomination of each of the Surrendered Classes of certificates.  No fee will be required with respect to any exchange of Exchangeable Certificates.  

 

  

Surrendered Classes (or Received
Classes) of Certificates
 

Received Classes (or Surrendered
Classes) of Certificates
 

  Class A-3Class A-3-1, Class A-3-X1
  Class A-3Class A-3-2, Class A-3-X2
  Class A-4Class A-4-1, Class A-4-X1
  Class A-4Class A-4-2, Class A-4-X2
  Class A-SClass A-S-1, Class A-S-X1
  Class A-SClass A-S-2, Class A-S-X2
  Class BClass B-1, Class B-X1
  Class BClass B-2, Class B-X2
  Class CClass C-1, Class C-X1
  Class CClass C-2, Class C-X2

 

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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On the closing date, the issuing entity will issue the following “trust components,” each with the initial principal balance (or, if such trust component has an “X” suffix, notional amount) and pass-through rate set forth next to it in the table below. Each trust component with an “X” suffix will not be entitled to distributions of principal.

 

 

Trust Component 

Initial Certificate Balance
or Notional Amount
 

Pass-Through Rate 

 Class A-3See footnote (9) to the table under “Certificate StructureClass A-3 Certificate Pass-Through Rate minus 1.00%
 Class A-3-X1Equal to Class A-3 Trust Component Certificate Balance0.50%
 Class A-3-X2Equal to Class A-3 Trust Component Certificate Balance0.50%
 Class A-4See footnote (9) to the table under “Certificate StructureClass A-4 Certificate Pass-Through Rate minus 1.00%
 Class A-4-X1Equal to Class A-4 Trust Component Certificate Balance0.50%
 Class A-4-X2Equal to Class A-4 Trust Component Certificate Balance0.50%
 Class A-S$58,019,000Class A-S Certificate Pass-Through Rate minus 1.00%
 Class A-S-X1Equal to Class A-S Trust Component Certificate Balance0.50%
 Class A-S-X2Equal to Class A-S Trust Component Certificate Balance0.50%
 Class B$34,624,000Class B Certificate Pass-Through Rate minus 1.00%
 Class B-X1Equal to Class B Trust Component Certificate Balance0.50%
 Class B-X2Equal to Class B Trust Component Certificate Balance0.50%
 Class C$29,010,000 (subject to the variance described in footnote (12) to the table under “Certificate Structure”)Class C Certificate Pass-Through Rate minus 1.00%
 Class C-X1Equal to Class C Trust Component Certificate Balance0.50%
 Class C-X2Equal to Class C Trust Component Certificate Balance0.50%

  

  Each class of Exchangeable Certificates represents an undivided beneficial ownership interest in the trust components set forth next to it in the table below (the “Corresponding Trust Components”). Each class of Exchangeable Certificates has a pass-through rate equal to the sum of the pass-through rates of the Corresponding Trust Components and represents a percentage interest (the related “Class Percentage Interest”) in each Corresponding Trust Component, including principal and interest payable thereon, equal to (x) the Certificate Balance (or, if such class has an “X” suffix, Notional Amount) of such class of certificates, divided by (y) the Certificate Balance of the Class A-3 trust component (if such class of Exchangeable Certificates has an “A-

 

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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  3” designation), the Class A-4 trust component (if such class of Exchangeable Certificates has an “A-4” designation), the Class A-S trust component (if such class of Exchangeable Certificates has an “A-S” designation), the Class B trust component (if such class of Exchangeable Certificates has a “B” designation) or the Class C trust component (if such class of Exchangeable Certificates has a “C” designation).

 

Group of Exchangeable
Certificates
 

Class of Exchangeable
Certificates
 

Corresponding Trust
Components
 

Class A-3 Exchangeable CertificatesClass A-3Class A-3, Class A-3-X1, Class A-3-X2
Class A-3-1Class A-3, Class A-3-X2
Class A-3-2Class A-3
Class A-3-X1Class A-3-X1
Class A-3-X2Class A-3-X1, Class A-3-X2
Class A-4 Exchangeable CertificatesClass A-4Class A-4, Class A-4-X1, Class A-4-X2
Class A-4-1Class A-4, Class A-4-X2
Class A-4-2Class A-4
Class A-4-X1Class A-4-X1
Class A-4-X2Class A-4-X1, Class A-4-X2
Class A-S Exchangeable CertificatesClass A-SClass A-S, Class A-S-X1, Class A-S-X2
Class A-S-1Class A-S, Class A-S-X2
Class A-S-2Class A-S
Class A-S-X1Class A-S-X1
Class A-S-X2Class A-S-X1, Class A-S-X2
Class B Exchangeable CertificatesClass BClass B, Class B-X1, Class B-X2
Class B-1Class B, Class B-X2
Class B-2Class B
Class B-X1Class B-X1
Class B-X2Class B-X1, Class B-X2
Class C Exchangeable CertificatesClass CClass C, Class C-X1, Class C-X2
Class C-1Class C, Class C-X2
Class C-2Class C
Class C-X1Class C-X1
Class C-X2Class C-X1, Class C-X2

 

  

The maximum Certificate Balance or Notional Amount of each class of Class A-3 Exchangeable Certificates that could be issued in an exchange is equal to the Certificate Balance of the Class A-3 trust component, the maximum Certificate Balance or Notional Amount of each class of Class A-4 Exchangeable Certificates that could be issued in an exchange is equal to the Certificate Balance of the Class A-4 trust component, the maximum Certificate Balance or Notional Amount of each class of Class A-S Exchangeable Certificates that could be issued in an exchange is equal to the Certificate Balance of the Class A-S trust component, the maximum Certificate Balance or Notional Amount of each class of Class B Exchangeable Certificates that could be issued in an exchange is equal to the Certificate Balance of the Class B trust component, and the maximum Certificate Balance or Notional Amount of each class of Class C Exchangeable Certificates that could be issued in an exchange is equal to the Certificate Balance of the Class C trust component. The maximum Certificate Balances of Class A-3, A-4, A-S, B and C Certificates (subject to the constraints on the aggregate initial Certificate Balance of the Class A-3 and Class A-4 trust components and the initial Certificate Balance of the Class C trust component discussed in

 

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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footnotes (9) and (12) to the table under “Certificate Structure”) will be issued on the closing date, and the Certificate Balance or Notional Amount of each other class of Exchangeable Certificates will be equal to zero on the closing date.

 

Each class of Class A-3 Exchangeable Certificates, Class A-4 Exchangeable Certificates, Class A-S Exchangeable Certificates, Class B Exchangeable Certificates and Class C Exchangeable Certificates will have a Certificate Balance or Notional Amount equal to its Class Percentage Interest multiplied by the Certificate Balance of the Class A-3 trust component, Class A-4 trust component, Class A-S trust component, Class B trust component or Class C trust component, respectively. Each class of Class A-3 Exchangeable Certificates, Class A-4 Exchangeable Certificates, Class A-S Exchangeable Certificates, Class B Exchangeable Certificates and Class C Exchangeable Certificates with a Certificate Balance will have the same approximate initial credit support percentage, Expected Weighted Average Life, Expected Principal Window, Certificate Principal U/W NOI Debt Yield and Certificate Principal to Value Ratio as the Class A-3 Certificates, Class A-4 Certificates, Class A-S Certificates, Class B Certificates or Class C Certificates, respectively, shown above.

 

Allocation of Yield Maintenance Charges and Prepayment Premiums: 

If any Yield Maintenance Charge or Prepayment Premium is collected during any particular collection period with respect to any mortgage loan, then on the Distribution Date corresponding to that collection period, the certificate administrator will pay that Yield Maintenance Charge or Prepayment Premium (net of liquidation fees payable therefrom) in the following manner:

 

(1)    to each class of the Class A-1, A-2, A-SB, A-3, A-3-1, A-3-2, A-4, A-4-1, A-4-2, A-S, A-S-1, A-S-2, B, B-1, B-2, C, C-1, C-2, D, E-RR and F-RR Certificates, the product of (a) such Yield Maintenance Charge or Prepayment Premium, (b) the related Base Interest Fraction for such class and the applicable principal prepayment, and (c) a fraction, the numerator of which is equal to the amount of principal distributed to such class for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date,

 

(2)    to the Class A-3-X1 Certificates, the product of (a) such Yield Maintenance Charge or Prepayment Premium, (b) a fraction, the numerator of which is equal to the amount of principal distributed to the Class A-3-1 Certificates for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date and (c) the difference between (i) the Base Interest Fraction for the Class A-3 Certificates and the applicable principal prepayment and (ii) the Base Interest Fraction for the Class A-3-1 Certificates and the applicable principal prepayment,

 

(3)    to the Class A-3-X2 Certificates, the product of (a) such Yield Maintenance Charge or Prepayment Premium, (b) a fraction, the numerator of which is equal to the amount of principal distributed to the Class A-3-2 Certificates for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date and (c) the difference between (i) the Base Interest Fraction for the Class A-3 Certificates and the applicable principal prepayment and (ii) the Base Interest Fraction for the Class A-3-2 Certificates and the applicable principal prepayment,

 

(4)    to the Class A-4-X1 Certificates, the product of (a) such Yield Maintenance Charge or Prepayment Premium, (b) a fraction, the numerator of which is equal to the amount of principal distributed to the Class A-4-1 Certificates for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date and (c) the difference between (i) the Base Interest Fraction for the Class A-4 Certificates and the applicable principal prepayment and (ii) the Base Interest Fraction for the Class A-4-1 Certificates and the applicable principal prepayment, 

 

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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(5)    to the Class A-4-X2 Certificates, the product of (a) such Yield Maintenance Charge or Prepayment Premium, (b) a fraction, the numerator of which is equal to the amount of principal distributed to the Class A-4-2 Certificates for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date and (c) the difference between (i) the Base Interest Fraction for the Class A-4 Certificates and the applicable principal prepayment and (ii) the Base Interest Fraction for the Class A-4-2 Certificates and the applicable principal prepayment,

 

(6)    to the Class A-S-X1 Certificates, the product of (a) such Yield Maintenance Charge or Prepayment Premium, (b) a fraction, the numerator of which is equal to the amount of principal distributed to the Class A-S-1 Certificates for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date and (c) the difference between (i) the Base Interest Fraction for the Class A-S Certificates and the applicable principal prepayment and (ii) the Base Interest Fraction for the Class A-S-1 Certificates and the applicable principal prepayment,

 

(7)    to the Class A-S-X2 Certificates, the product of (a) such Yield Maintenance Charge or Prepayment Premium, (b) a fraction, the numerator of which is equal to the amount of principal distributed to the Class A-S-2 Certificates for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date and (c) the difference between (i) the Base Interest Fraction for the Class A-S Certificates and the applicable principal prepayment and (ii) the Base Interest Fraction for the Class A-S-2 Certificates and the applicable principal prepayment,

 

(8)    to the Class B-X1 Certificates, the product of (a) such Yield Maintenance Charge or Prepayment Premium, (b) a fraction, the numerator of which is equal to the amount of principal distributed to the Class B-1 Certificates for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date and (c) the difference between (i) the Base Interest Fraction for the Class B Certificates and the applicable principal prepayment and (ii) the Base Interest Fraction for the Class B-1 Certificates and the applicable principal prepayment,

 

(9)    to the Class B-X2 Certificates, the product of (a) such Yield Maintenance Charge or Prepayment Premium, (b) a fraction, the numerator of which is equal to the amount of principal distributed to the Class B-2 Certificates for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date and (c) the difference between (i) the Base Interest Fraction for the Class B Certificates and the applicable principal prepayment and (ii) the Base Interest Fraction for the Class B-2 Certificates and the applicable principal prepayment,

 

(10)   to the Class C-X1 Certificates, the product of (a) such Yield Maintenance Charge or Prepayment Premium, (b) a fraction, the numerator of which is equal to the amount of principal distributed to the Class C-1 Certificates for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date and (c) the difference between (i) the Base Interest Fraction for the Class C Certificates and the applicable 

  

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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principal prepayment and (ii) the Base Interest Fraction for the Class C-1 Certificates and the applicable principal prepayment,

 

(11)   to the Class C-X2 Certificates, the product of (a) such Yield Maintenance Charge or Prepayment Premium, (b) a fraction, the numerator of which is equal to the amount of principal distributed to the Class C-2 Certificates for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date and (c) the difference between (i) the Base Interest Fraction for the Class C Certificates and the applicable principal prepayment and (ii) the Base Interest Fraction for the Class C-2 Certificates and the applicable principal prepayment,

 

(12)   to the Class X-A Certificates, the excess, if any, of (a) the product of (i) such Yield Maintenance Charge or Prepayment Premium and (ii) a fraction, the numerator of which is equal to the total amount of principal distributed to the Class A-1, A-2 and A-SB Certificates and the Class A-3 Exchangeable Certificates and the Class A-4 Exchangeable Certificates for that Distribution Date, and the denominator of which is the total amount of principal distributed to the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3 Exchangeable Certificates, the Class A-4 Exchangeable Certificates, the Class A-S Exchangeable Certificates, the Class B Exchangeable Certificates and the Class C Exchangeable Certificates for that Distribution Date, over (b) the total amount of such Yield Maintenance Charge or Prepayment Premium distributed to the Class A-1, Class A-2 and Class A-SB Certificates and the Class A-3 Exchangeable Certificates and the Class A-4 Exchangeable Certificates as described above, and

 

(13)   to the Class X-B Certificates, any remaining portion of such Yield Maintenance Charge or Prepayment Premium not distributed as described above.

 

No Prepayment Premiums or Yield Maintenance Charges will be distributed to the holders of the Class X-D, G-RR, H-RR, J-RR, K-RR, L-RR, M-RR, V or R Certificates. For a description of when Prepayment Premiums and Yield Maintenance Charges are generally required on the mortgage loans, see Annex A-1 to the Preliminary Prospectus. See also “Risk Factors—Risks Relating to the Mortgage Loans—Risks Relating to Enforceability of Yield Maintenance Charges, Prepayment Premiums or Defeasance Provisions” and “Risk Factors—Other Risks Relating to the Certificates—Your Yield May Be Affected by Defaults, Prepayments and Other Factors” in the Preliminary Prospectus. Prepayment Premiums and Yield Maintenance Charges will be distributed on each Distribution Date only to the extent they are actually received on the mortgage loans as of the related Determination Date. 

  

Realized Losses: 

The Certificate Balances of the Class A-1, A-2, A-SB, D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates and the Class A-3, A-4, A-S, B and C trust components will be reduced without distribution on any Distribution Date as a write-off to the extent of any losses realized on the mortgage loans allocated to such Class on such Distribution Date. Such losses will be applied in the following order, in each case until the related Certificate Balance is reduced to zero: first, to the Class M-RR Certificates; second, to the Class L-RR Certificates; third, to the Class K-RR Certificates; fourth, to the Class J-RR Certificates; fifth, to the Class H-RR Certificates; sixth, to the Class G-RR Certificates; seventh, to the Class F-RR Certificates; eighth, to the Class E-RR Certificates; ninth, to the Class D Certificates; tenth, to the Class C trust component; eleventh, to the Class B trust component; twelfth, to the Class A-S trust component; and, finally, pro rata, to the Class A-1, A-2 and A-SB Certificates and the Class A-3 and A-4 trust components based on their outstanding Certificate Balances.

 

Any portion of such amount applied to the Class A-3, A-4, A-S, B or C trust component will reduce the Certificate Balance or Notional Amount of each Class of Certificates in the related group of Exchangeable Certificates by an amount equal to the product of (x) its Certificate Balance or Notional Amount, divided by the Certificate Balance of such trust component prior to the applicable reduction, and (y) the amount applied to such trust component.

 

The Notional Amount of the Class X-A Certificates will be reduced by the amount of all losses that are allocated to the Class A-1, A-2 and A-SB Certificates and the Class A-3 and A-4 trust components as write-offs in reduction of their Certificate Balances. The Notional Amount of the Class X-B Certificates will be reduced by the amount of all losses that are allocated to the Class A-S, B or C trust components as write-offs in reduction of their Certificate Balances.

 

P&I Advances: The Master Servicer or, if the Master Servicer fails to do so, the Trustee, will be obligated to advance delinquent debt service payments (other than balloon payments, excess interest and default interest) and assumed debt service payments on mortgage loans with delinquent balloon payments (excluding any related companion loan), except to the extent any such advance is deemed non-recoverable from collections on the related mortgage loan.  In addition, if an Appraisal Reduction Amount exists for a given mortgage loan, the interest portion of any P&I

  

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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 advance for such mortgage loan will be reduced, which will have the effect of reducing the amount of interest available for distribution to the Certificates in reverse alphabetical order of their Class designations (except that interest payments on the Class A-1, A-2, A-SB, A-3, A-3-X1, A-3-X2, A-4, A-4-X1, A-4-X2, X-A, X-B and X-D Certificates would be affected on a pari passu basis).
   
Servicing Advances: The Master Servicer or, if the Master Servicer fails to do so, the Trustee, will be obligated to make servicing advances, including the payment of delinquent property taxes, insurance premiums and ground rent, except to the extent that those advances are deemed non-recoverable from collections on the related mortgage loan. The Master Servicer or the Trustee, as applicable, will have the primary obligation to make any required servicing advances with respect to any serviced whole loan. With respect to any non-serviced whole loan, the master servicer or trustee, as applicable, under the related lead securitization servicing agreement will have the primary obligation to make any required servicing advances with respect to such non-serviced whole loan.
   

Appraisal Reduction Amounts and Collateral Deficiency Amounts:

 

 

An “Appraisal Reduction Amount” generally will be created in the amount, if any, by which the principal balance of a required appraisal loan (which is a mortgage loan (other than a non-serviced mortgage loan) with respect to which certain defaults, modifications or insolvency events have occurred as further described in the Preliminary Prospectus) plus other amounts overdue or advanced in connection with such mortgage loan exceeds 90% of the appraised value of the related mortgaged property plus certain escrows and reserves (including letters of credit) held with respect to the mortgage loan. With respect to any serviced whole loan, any Appraisal Reduction Amount will be allocated, pro rata, to the related mortgage loan and the related pari passu companion loan(s). With respect to any non-serviced mortgage loan, appraisal reduction amounts are expected to be calculated in a similar manner under the related non-serviced pooling and servicing agreement.

 

A mortgage loan will cease to be a required appraisal loan when the same has ceased to be a specially serviced loan (if applicable), has been brought current for at least three consecutive months and no other circumstances exist that would cause such mortgage loan to be a required appraisal loan.

 

A “Collateral Deficiency Amount” will exist with respect to any mortgage loan that is modified into an AB loan structure and remains a corrected mortgage loan and will generally equal the excess of (i) the stated principal balance of such AB modified loan (taking into account the related junior note(s) and any pari passu notes included therein), over (ii) the sum of (in the case of a whole loan, solely to the extent allocable to the subject mortgage loan) (x) the most recent appraised value for the related mortgaged property or mortgaged properties plus (y) solely to the extent not reflected or taken into account in such appraised value and to the extent on deposit with, or otherwise under the control of, the lender as of the date of such determination, any capital or additional collateral contributed by the related borrower at the time the mortgage loan became (and as part of the modification related to) such AB modified loan for the benefit of the related mortgaged property or mortgaged properties (provided that in the case of a non-serviced mortgage loan, the amounts set forth in this clause (y) will be taken into account solely to the extent relevant information is received by the master servicer), plus (z) any other escrows or reserves (in addition to any amounts set forth in the immediately preceding clause (y)) held by the lender in respect of such AB modified loan as of the date of such determination.

 

A “Cumulative Appraisal Reduction Amount” with respect to any mortgage loan will be the sum of (i) all Appraisal Reduction Amounts then in effect, and (ii) with respect to any AB modified loan, any Collateral Deficiency Amount then in effect.

 

Appraisal Reduction Amounts will affect the amount of debt service advances in respect of the related mortgage loan. Additionally, Cumulative Appraisal Reduction Amounts will be taken into account in the determination of the identity of the Class whose majority constitutes the “majority controlling class certificateholder” and is entitled to appoint the directing certificateholder.

 

Neither (i) a Payment Accommodation with respect to any mortgage loan or serviced whole loan nor (ii) any default or delinquency that would have existed but for such Payment Accommodation will constitute an appraisal reduction event, for so long as the related borrower is complying with the terms of such Payment Accommodation.

 

A “Payment Accommodation” for any mortgage loan or serviced whole loan means the entering into of any temporary forbearance agreement as a result of the COVID-19 emergency (and qualification as a COVID-19 emergency forbearance will be determined by the special servicer in its sole and absolute discretion in accordance with the servicing standard) relating to payment obligations or operating covenants under the related mortgage loan documents or the use of funds on deposit in any reserve account or escrow account for any purpose other than the explicit purpose described in the related mortgage loan documents, that in each case (i) is entered into no later than the date that is 3 months following the cancellation of the COVID emergency and (ii) requires full repayment of deferred payments, reserves and escrows by the date that is 21

 

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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  months following the date of the first Payment Accommodation for such mortgage loan or serviced whole loan.
   

Clean-Up Call and Exchange Termination:

 

 

On each Distribution Date occurring after the aggregate unpaid principal balance of the pool of mortgage loans is less than 1.0% of the principal balance of the mortgage loans as of the cut-off date (solely for the purposes of this calculation, if such right is being exercised after the distribution date in July 2031 and either of the Garver Little Rock mortgage loan or Dollar General – Saginaw (E. Washington Road) mortgage loan is still an asset of the issuing entity, then such mortgage loan will be excluded from the then-aggregate principal balance of the pool of mortgage loans and from the initial pool balance), certain specified persons will have the option to purchase all of the remaining mortgage loans (and the trust’s interest in all property acquired through exercise of remedies in respect of any mortgage loan) at the price specified in the Preliminary Prospectus. Exercise of the option will terminate the trust and retire the then-outstanding Certificates.

 

If the aggregate Certificate Balances of each of the Class A-1, A-2, A-SB and D Certificates and the Class A-3, A-4, A-S, B and C trust components have been reduced to zero, the trust may also be terminated in connection with an exchange of all the then-outstanding Certificates (other than the Class V and Class R Certificates) for the mortgage loans and REO properties then remaining in the issuing entity, subject to payment of a price specified in the Preliminary Prospectus, but all of the holders of those outstanding Classes of Certificates (other than the Class V and Class R Certificates) would have to voluntarily participate in the exchange.

 

Liquidation Loan Waterfall: Following the liquidation of any mortgage loan or mortgaged property, the net liquidation proceeds generally will be applied (after reimbursement of advances and certain trust fund expenses), first, as a recovery of accrued interest, other than delinquent interest that was not advanced as a result of Appraisal Reduction Amounts, second, as a recovery of principal until all principal has been recovered, and then as a recovery of delinquent interest that was not advanced as a result of Appraisal Reduction Amounts. Please see “Description of the Certificates—Distributions—Distributions—Application Priority of Mortgage Loan Collections or Whole Loan Collections” in the Preliminary Prospectus.
   
Control Eligible Certificates: The Class E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates.
   
Directing Certificateholder/ Controlling Class: 

A directing certificateholder may be appointed by the “majority controlling class certificateholder”, which will be the holder(s) of a majority of the Controlling Class.

 

The “Controlling Class” will be, as of any time of determination, the most subordinate Class of Control Eligible Certificates then outstanding that has an aggregate Certificate Balance (as notionally reduced by any Cumulative Appraisal Reduction Amounts allocable to such Class(es)) at least equal to 25% of the initial Certificate Balance of that Class; provided, however, that if at any time the Certificate Balances of the Certificates other than the Control Eligible Certificates have been reduced to zero as a result of principal payments on the Mortgage Loans, then the Controlling Class will be the most subordinate Class of Control Eligible Certificates that has a Certificate Balance greater than zero without regard to any Cumulative Appraisal Reduction Amounts. The Controlling Class as of the closing date will be the Class M-RR Certificates.

 

Control and Consultation: 

The rights of various parties to replace the Special Servicer and approve or consult with respect to major actions of the Special Servicer will vary according to defined periods.

 

A “Control Termination Event” will occur when the Class E-RR Certificates have a Certificate Balance (taking into account the application of any Cumulative Appraisal Reduction Amounts to notionally reduce the Certificate Balance of such Class) of less than 25% of the initial Certificate Balance of that Class; provided that a Control Termination Event will not be deemed continuing in the event that the Certificate Balances of the Certificates other than the Control Eligible Certificates have been reduced to zero as a result of principal payments on the mortgage loans.

 

A “Consultation Termination Event” will occur when there is no Class of Control Eligible Certificates that has a then-outstanding Certificate Balance at least equal to 25% of the initial Certificate Balance of that Class, in each case, without regard to the application of any Cumulative Appraisal Reduction Amounts; provided, that a Consultation Termination Event will not be deemed continuing in the event that the Certificate Balances of the Certificates other than the Control Eligible Certificates have been reduced to zero as a result of principal payments on the mortgage loans.

 

If no Control Termination Event has occurred and is continuing, except with respect to the Excluded Loans (as defined below) (i) the directing certificateholder will be entitled to grant or withhold approval of asset status reports prepared, and material servicing actions proposed, by the Special Servicer, and (ii) the directing certificateholder will be entitled to terminate and replace the Special Servicer with or without cause, and appoint itself or another person as the successor special servicer. It will be a condition to such appointment that DBRS Morningstar, Fitch, and Moody’s (and any rating agency rating any securities backed by any pari passu 

 

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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companion loan(s) serviced under this transaction) confirm that the appointment would not result in a qualification, downgrade or withdrawal of any of their then-current ratings of Certificates (and any certificates backed by any pari passu companion loan(s) serviced under this transaction).

 

If a Control Termination Event has occurred and is continuing but no Consultation Termination Event has occurred and is continuing, the Special Servicer will be required to consult with the directing certificateholder (other than with respect to Excluded Loans) in connection with asset status reports and material special servicing actions.

 

If a Consultation Termination Event has occurred and is continuing, no directing certificateholder will be recognized or have any right to terminate the Special Servicer or approve, direct or consult with respect to servicing matters.

 

With respect to each serviced whole loan, the rights of the directing certificateholder described above will be subject to the consultation rights of the holders of the related pari passu companion loans. Those consultation rights will generally extend to asset status reports and material special servicing actions involving the related whole loan, will be as set forth in the related intercreditor agreement, and will be in addition to the rights of the directing certificateholder in this transaction described above.

 

With respect to each non-serviced whole loan, the applicable servicing agreement for the related controlling pari passu companion loan(s) generally grants (or will grant) the directing certificateholder under the related securitization control rights that may include the right to approve or disapprove various material servicing actions involving the related whole loan. The directing certificateholder for this securitization (so long as no Consultation Termination Event has occurred and is occurring) generally will nonetheless have the right to be consulted on a non-binding basis with respect to such actions. For purposes of the servicing of any such whole loan contemplated by this paragraph, the occurrence and continuance of a Control Termination Event or Consultation Termination Event under this securitization will not limit the control or other rights of the directing certificateholder (or equivalent) under the securitization of the related controlling pari passu companion loan(s).

 

The control rights and consent and consultation rights described in the preceding paragraphs are subject to various limitations, conditions and exceptions as described in the Preliminary Prospectus.

 

Notwithstanding any contrary description set forth above, in the event that, with respect to any mortgage loan, the majority controlling class certificateholder or the directing certificateholder is a Borrower Party, the majority controlling class certificateholder and the directing certificateholder will have no right to receive asset status reports or such other information as may be specified in the WFCM 2021-C60 pooling and servicing agreement, to grant or withhold approval of, or consult with respect to, asset status reports prepared, and material servicing actions proposed, by the Special Servicer, with respect to such mortgage loan, and such mortgage loan will be referred to as an “Excluded Loan” as to such party.

 

In addition, notwithstanding any contrary description set forth above, in the event that, with respect to any mortgage loan, a controlling class certificateholder is a Borrower Party, such controlling class certificateholder will have no right to receive asset status reports or such other information as may be specified in the WFCM 2021-C60 pooling and servicing agreement with respect to such mortgage loan.

 

“Borrower Party” means a borrower, a mortgagor or a manager of a mortgaged property, an Accelerated Mezzanine Loan Lender, or any Borrower Party Affiliate. “Accelerated Mezzanine Loan Lender” means a mezzanine lender under a mezzanine loan that has been accelerated or as to which foreclosure or enforcement proceedings have been commenced against the equity collateral pledged to secure such mezzanine loan. “Borrower Party Affiliate” means, with respect to a borrower, a mortgagor, a manager of a mortgaged property or an Accelerated Mezzanine Loan Lender, (x) any other person controlling or controlled by or under common control with such borrower, mortgagor, manager or Accelerated Mezzanine Loan Lender, as applicable, or (y) any other person owning, directly or indirectly, 25% or more of the beneficial interests in such borrower, mortgagor, manager or Accelerated Mezzanine Loan Lender, as applicable.

 

Replacement of Special Servicer: 

If a Control Termination Event has occurred and is continuing, the Special Servicer may be removed and replaced without cause upon the affirmative direction of certificate owners holding not less than 66-2/3% of a certificateholder quorum, following a proposal from certificate owners holding not less than 25% of the appraisal-reduced voting rights of all Principal Balance Certificates. The certificateholders who initiate a vote on a termination and replacement of the Special Servicer without cause must cause DBRS Morningstar, Fitch and Moody’s to confirm the then-current ratings of the Certificates (or decline to review the matter) and cause the payment 

 

 

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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of the fees and expenses incurred in the replacement. If no Control Termination Event has occurred and is continuing, the Special Servicer may be replaced by the directing certificateholder, subject to DBRS Morningstar, Fitch and Moody’s (and any Rating Agency rating any securities backed by any pari passu companion loan(s) serviced under this transaction) confirming the then-current ratings of the Certificates (and any certificates backed by any pari passu companion loans serviced under this transaction) or declining to review the matter.

 

In addition, if at any time the Operating Advisor determines, in its sole discretion exercised in good faith, that (i) the Special Servicer is not performing its duties as required under the pooling and servicing agreement in accordance with the Servicing Standard and (ii) the replacement of the Special Servicer would be in the best interest of the certificateholders as a collective whole, then the Operating Advisor will have the right to recommend the replacement of the Special Servicer and will submit its formal recommendation to the Trustee and the Certificate Administrator (along with its rationale, its proposed replacement special servicer and other relevant information justifying its recommendation).

 

The Operating Advisor’s recommendation to replace the Special Servicer must be confirmed by an affirmative vote of holders of Principal Balance Certificates evidencing at least a majority of a quorum of certificateholders (which, for this purpose, is the holders of Principal Balance Certificates that (i) evidence at least 20% of the Voting Rights (taking into account the application of any cumulative appraisal reduction amounts to notionally reduce the respective Certificate Balances) of all Principal Balance Certificates on an aggregate basis, and (ii) consist of at least three certificateholders or certificate owners that are not risk retention affiliated with each other). In the event the holders of Principal Balance Certificates evidencing at least a majority of a quorum of certificateholders elect to remove and replace the Special Servicer (which requisite affirmative votes must be received within 180 days of the posting of the notice of the Operating Advisor’s recommendation to replace the Special Servicer to the Certificate Administrator’s website), the Certificate Administrator will be required to receive a Rating Agency Confirmation from each of the Rating Agencies at that time, and confirmation from the applicable rating agencies that such replacement will not result in the downgrade, withdrawal or qualification of the then-current ratings of any class of any related serviced pari passu companion loan securities.

 

Excluded Special Servicer: In the event that, with respect to any mortgage loan, the Special Servicer is a Borrower Party, the Special Servicer will be required to resign as special servicer of such mortgage loan (referred to as an “excluded special servicer loan”). If no Control Termination Event has occurred and is continuing, the directing certificateholder will be entitled to appoint (and may replace with or without cause) a separate special servicer that is not a Borrower Party (referred to as an “excluded special servicer”) with respect to such excluded special servicer loan unless such excluded special servicer loan is also an excluded loan.  Otherwise, upon resignation of the Special Servicer with respect to an excluded special servicer loan, the resigning Special Servicer will be required to use commercially reasonable efforts to appoint the excluded special servicer.
   
Appraisal Remedy: If the Class of Certificates comprising the Controlling Class loses its status as Controlling Class because of the application of an Appraisal Reduction Amount or Collateral Deficiency Amount, the holders of a majority of the voting rights of such Class may require the Special Servicer to order a second appraisal for any mortgage loan in respect of which an Appraisal Reduction Amount or Collateral Deficiency Amount has been applied.  The Special Servicer must thereafter determine whether, based on its assessment of such second appraisal, any recalculation of the Appraisal Reduction Amount or Collateral Deficiency Amount is warranted and, if so warranted, will recalculate such Appraisal Reduction Amount or Collateral Deficiency Amount. Such Class will not be able to exercise any direction, control, consent and/or similar rights of the Controlling Class unless and until reinstated as the Controlling Class through such determination; and pending such determination, the rights of the Controlling Class will be exercised by the Control Eligible Certificates, if any, that would be the Controlling Class taking into account the subject appraisal reduction amount.

 

Sale of Defaulted Assets: 

There will be no “fair value” purchase option. Instead, the WFCM 2021-C60 pooling and servicing agreement will authorize the Special Servicer to sell defaulted mortgage loans serviced by such Special Servicer to the highest bidder in a manner generally similar to sales of REO properties.

 

The sale of a defaulted loan (other than a non-serviced whole loan) for less than par plus accrued interest and certain other fees and expenses owed on the loan will be subject to consent or consultation rights of the directing certificateholder and/or Operating Advisor, as described in the Preliminary Prospectus. Generally speaking, the holder of a pari passu companion loan will have consent and/or consultation rights, as described in the Preliminary Prospectus.

 

With respect to any serviced whole loan, if such whole loan becomes a defaulted loan under the WFCM 2021-C60 pooling and servicing agreement, the Special Servicer will generally be required to sell both the mortgage loan and the related pari passu companion loan(s) as a single whole loan.

  

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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With respect to each non-serviced whole loan, the applicable servicing agreement governing the servicing of such whole loan generally provides (or is expected to provide) that, if the related pari passu companion loan(s) serviced under such agreement become a defaulted loan under such servicing agreement, then the related special servicer may offer to sell to any person (or may offer to purchase) for cash such whole loan during such time as such applicable pari passu companion loan(s) constitutes a defaulted loan under such servicing agreement. Generally speaking, in connection with any such sale, the related special servicer is required to sell both the mortgage loan and the related pari passu companion loan(s) (and, in some cases, any related subordinate companion loan) as a whole loan. The directing certificateholder for this securitization generally will have consultation rights as the holder of an interest in the related mortgage loan, as described in the Preliminary Prospectus.

 

The procedures for the sale of any whole loan that becomes a defaulted whole loan, and any associated consultation rights, are subject to various limitations, conditions and exceptions as described in the Preliminary Prospectus.

 

“As-Is” Appraisals: Appraisals must be conducted on an “as-is” basis, and must be no more than 12 months old, for purposes of determining Appraisal Reduction Amounts and market value in connection with REO sales.  Required appraisals may consist of updates of prior appraisals.  Internal valuations by the Special Servicer are permitted if the principal balance of a mortgage loan is less than $2,000,000.
   
Operating Advisor: 

The Operating Advisor will have certain review and consultation rights relating to the performance of the Special Servicer and with respect to its actions taken in connection with the resolution and/or liquidation of Specially Serviced Loans. With respect to each mortgage loan (other than a Non-Serviced Mortgage Loan) or serviced whole loan, the Operating Advisor will be responsible for:

 

●    reviewing the actions of the Special Servicer with respect to any Specially Serviced Loan;

 

●    reviewing (i) all reports by the Special Servicer made available to Privileged Persons on the Certificate Administrator’s website that are relevant to the Operating Advisor’s obligations under the pooling and servicing agreement and (ii) each Asset Status Report (as defined in the Preliminary Prospectus) (after the occurrence and during the continuance of an Operating Advisor Consultation Event (as defined below)) and Final Asset Status Report (as defined in the Preliminary Prospectus);

 

●    recalculating and reviewing for accuracy and consistency with the WFCM 2021-C60 pooling and servicing agreement the mathematical calculations by the special servicer and the corresponding application of the non-discretionary portion of the applicable formulas required to be utilized in connection with Appraisal Reduction Amounts, Collateral Deficiency Amounts and net present value calculations used in the Special Servicer’s determination of what course of action to take in connection with the workout or liquidation of a Specially Serviced Loan; and

 

●    preparing an annual report (if any mortgage loan (other than any Non-Serviced Mortgage Loan) or serviced whole loan was a Specially Serviced Loan at any time during the prior calendar year or an Operating Advisor Consultation Event (as defined below) occurred during the prior calendar year) that sets forth whether the Operating Advisor believes, in its sole discretion exercised in good faith, that the Special Servicer is operating in compliance with the Servicing Standard with respect to its performance of its duties under the pooling and servicing agreement with respect to Specially Serviced Loans (and, after the occurrence and continuance of an Operating Advisor Consultation Event (as defined below), with respect to major decisions on non-Specially Serviced Loans) during the prior calendar year on a “trust-level basis”. The Operating Advisor will identify (1) which, if any, standards the Operating Advisor believes, in its sole discretion exercised in good faith, the Special Servicer has failed to comply with and (2) any material deviations from the Special Servicer’s obligations under the pooling and servicing agreement with respect to the resolution or liquidation of any Specially Serviced Loan or REO Property (other than with respect to any REO Property related to any Non-Serviced Mortgage Loan). In preparing any Operating Advisor Annual Report (as defined in the Preliminary Prospectus), the Operating Advisor will not be required to report on instances of non-compliance with, or deviations from, the Servicing Standard or the Special Servicer’s obligations under the pooling and servicing agreement that the Operating Advisor determines, in its sole discretion exercised in good faith, to be immaterial.

 

With respect to each mortgage loan (other than any Non-Serviced Mortgage Loan) or serviced whole loan, after the Operating Advisor has received notice that an Operating Advisor 

 

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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Consultation Event (as defined below) has occurred and is continuing, in addition to the duties described above, the Operating Advisor will be required to perform the following additional duties:

 

●    to consult (on a non-binding basis) with the Special Servicer in respect of asset status reports and

 

●    to consult (on a non-binding basis) with the Special Servicer with respect to “major decisions” processed by the Special Servicer.

 

An “Operating Advisor Consultation Event” will occur when the Certificate Balances of the Class D, E-RR, F-RR, G-RR, H-RR, J-RR, K-RR, L-RR and M-RR Certificates in the aggregate (taking into account the application of any Cumulative Appraisal Reduction Amounts to notionally reduce the Certificate Balances of such Classes) is 25% or less of the initial Certificate Balances of such Classes in the aggregate.

 

Asset Representations Reviewer: 

The Asset Representations Reviewer will be required to review certain delinquent mortgage loans after a specified delinquency threshold has been exceeded (an “Asset Review Trigger”) and the required percentage of certificateholders vote to direct a review of such delinquent loans. An Asset Review Trigger will occur when either (1) mortgage loans with an aggregate outstanding principal balance of 25.0% or more of the aggregate outstanding principal balance of all of the mortgage loans (including any REO loans (or a portion of any REO loan in the case of a whole loan)) held by the issuing entity as of the end of the applicable collection period are delinquent loans or (2) at least 15 mortgage loans are delinquent loans as of the end of the applicable collection period and the outstanding principal balance of such delinquent loans in the aggregate constitutes at least 20.0% of the aggregate outstanding principal balance of all of the mortgage loans (including any REO loans (or a portion of any REO loan in the case of a whole loan)) held by the issuing entity as of the end of the applicable collection period. See “Pooling and Servicing Agreement—The Asset Representations Reviewer—Asset Review” in the Preliminary Prospectus.

 

The Asset Representations Reviewer may be terminated and replaced without cause. Upon (i) the written direction of certificateholders evidencing not less than 25% of the voting rights (without regard to the application of any Cumulative Appraisal Reduction Amounts) requesting a vote to terminate and replace the Asset Representations Reviewer with a proposed successor Asset Representations Reviewer that is an eligible asset representations reviewer, and (ii) payment by such holders to the certificate administrator of the reasonable fees and expenses to be incurred by the certificate administrator in connection with administering such vote, the certificate administrator will promptly provide notice to all certificateholders and the Asset Representations Reviewer of such request by posting such notice on its internet website, and by mailing such notice to all certificateholders and the Asset Representations Reviewer. Upon the written direction of certificateholders evidencing at least 75% of a certificateholder quorum (without regard to the application of any Cumulative Appraisal Reduction Amounts), the Trustee will terminate all of the rights and obligations of the Asset Representations Reviewer under the WFCM 2021-C60 pooling and servicing agreement by written notice to the Asset Representations Reviewer, and the proposed successor Asset Representations Reviewer will be appointed. See “Pooling and Servicing Agreement—The Asset Representations Reviewer” in the Preliminary Prospectus.

 

Dispute Resolution Provisions: 

The mortgage loan sellers will be subject to the dispute resolution provisions set forth in the WFCM 2021-C60 pooling and servicing agreement to the extent those provisions are triggered with respect to any mortgage loan sold to the depositor by a mortgage loan seller and such mortgage loan seller will be obligated under the related mortgage loan purchase agreement to comply with all applicable provisions and to take part in any mediation or arbitration proceedings that may result.

 

Generally, in the event that a Repurchase Request (as defined in the Preliminary Prospectus) is not “Resolved” (as defined below) within 180 days after the related mortgage loan seller receives such Repurchase Request, then the enforcing servicer will be required to send a notice to the “Initial Requesting Certificateholder” (if any) and the Certificate Administrator indicating the enforcing servicer’s intended course of action with respect to the Repurchase Request. If (a) the enforcing servicer’s intended course of action with respect to the Repurchase Request does not involve pursuing further action to exercise rights against the related mortgage loan seller with respect to the Repurchase Request and the Initial Requesting Certificateholder, if any, or any other certificateholder or certificate owner wishes to exercise its right to refer the matter to mediation (including non-binding arbitration) or arbitration, or (b) the enforcing servicer’s intended course of action is to pursue further action to exercise rights against the related mortgage loan seller with respect to the Repurchase Request but the Initial Requesting Certificateholder, if any, or any other certificateholder or certificate owner does not agree with the dispute resolution method selected by the enforcing servicer, then the Initial Requesting Certificateholder, if any, or such other certificateholder or certificate owner may deliver a written

 

 

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

 

 

Wells Fargo Commercial Mortgage Trust 2021-C60

Certain Terms and Conditions

  

 

notice to the Special Servicer indicating its intent to exercise its right to refer the matter to either mediation or arbitration.

 

“Resolved” means, with respect to a Repurchase Request, (i) that the related Material Defect has been cured, (ii) the related mortgage loan has been repurchased in accordance with the related mortgage loan purchase agreement, (iii) a mortgage loan has been substituted for the related mortgage loan in accordance with the related mortgage loan purchase agreement, (iv) the applicable mortgage loan seller makes a Loss of Value Payment (as defined in the Preliminary Prospectus), (v) a contractually binding agreement is entered into between the enforcing servicer, on behalf of the issuing entity, and the related mortgage loan seller that settles the related mortgage loan seller’s obligations under the related mortgage loan purchase agreement or (vi) the related mortgage loan is no longer property of the issuing entity as a result of a sale or other disposition in accordance with the WFCM 2021-C60 pooling and servicing agreement. See “Pooling and Servicing Agreement—Dispute Resolution Provisions” in the Preliminary Prospectus.

 

Investor Communications: The certificate administrator is required to include on any Form 10–D any request received from a certificateholder to communicate with other certificateholders related to certificateholders exercising their rights under the terms of the WFCM 2021-C60 pooling and servicing agreement. Any certificateholder wishing to communicate with other certificateholders regarding the exercise of its rights under the terms of the WFCM 2021-C60 pooling and servicing agreement will be able to deliver a written request signed by an authorized representative of the requesting investor to the certificate administrator.
   
Certain Fee Offsets: If a workout fee is earned by the Special Servicer following a loan default with respect to any mortgage loan that it services, then certain limitations will apply based on modification fees paid by the borrower.  The modification fee generally must not exceed 1% of the principal balance of the loan as modified in any 12-month period.  In addition, if the loan re-defaults, any subsequent workout fee on that loan must be reduced by a portion of the modification fees paid by the borrower in the previous 12-months. Likewise, liquidation fees collected in connection with a liquidation or partial liquidation of a mortgage loan must be reduced by a portion of the modification fees paid by the borrower in the previous 12 months.
   
Deal Website: The Certificate Administrator will be required to maintain a deal website, which will include, among other items: (a) summaries of asset status reports prepared by the Special Servicer, (b) inspection reports, (c) appraisals, (d) various “special notices” described in the Preliminary Prospectus, (e) the “Investor Q&A Forum”, (f) a voluntary “Investor Registry” and (g) the “Risk Retention Special Notices” tab.  Investors may access the deal website following execution of a certification and confidentiality agreement.
   
Initial Majority Controlling Class Certificateholder: It is expected that KKR Real Estate Credit Opportunity Partners II L.P. or an affiliate will be the initial majority controlling class certificateholder.
   
Whole Loans: Each of the mortgaged properties identified above under “IV. Characteristics of the Mortgage Pool—B. Summary of the Whole Loans” secures both a mortgage loan to be included in the trust fund and one or more other mortgage loans that will not be included in the trust fund, each of which will be pari passu or subordinate in right of payment with the mortgage loan included in the trust fund. We refer to each such group of mortgage loans as a “whole loan”. Such “—Summary of the Whole Loans” section includes further information regarding the various notes in each whole loan, the holders of such notes, the lead servicing agreement for each such whole loan, and the master servicer and special servicer under such lead servicing agreement.

  

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

 

 

(THIS PAGE INTENTIONALLY LEFT BLANK)

 

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

 

 

Industrial - WarehouseLoan #1Cut-off Date Balance: $65,000,000

Property Addresses – Various 

Lansdale, PA 19446 

Velocity Industrial PortfolioCut-off Date LTV: 57.8%
  U/W NCF DSCR: 2.72x
  U/W NOI Debt Yield: 9.4%

 

 

(GRAPHIC) 

 

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

 

 

Industrial - WarehouseLoan #1Cut-off Date Balance: $65,000,000

Property Addresses – Various 

Lansdale, PA 19446 

Velocity Industrial PortfolioCut-off Date LTV: 57.8%
  U/W NCF DSCR: 2.72x
  U/W NOI Debt Yield: 9.4%

 

 

(GRAPHIC) 

 

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.

 

37

 

  

No. 1 – Velocity Industrial Portfolio
 
Mortgage Loan Information Mortgaged Property Information
Mortgage Loan Seller:Wells Fargo Bank, National Association Single Asset/Portfolio:Portfolio

Credit Assessment 

(DBRSM/Fitch/Moody’s): 

NR/NR/NR Property Type – Subtype:Industrial - Warehouse
Original Principal Balance:$65,000,000 Location:Lansdale, PA
Cut-off Date Balance(1):$65,000,000 Size:1,130,782 SF
% of Initial Pool Balance:8.7% Cut-off Date Balance Per SF(1):$66.33
Loan Purpose:Refinance Maturity Date Balance Per SF:$66.33
Borrower Sponsor:Zachary Moore and Anthony Grelli, Jr. Year Built/Renovated:Various/2021
Guarantor:Zachary Moore and Anthony Grelli, Jr. Title Vesting:Fee
Interest Rate:3.2300% Property Manager:Last Mile Management LLC
Note Date:June 28, 2021 Current Occupancy (As of):89.3% (6/23/2021)
Seasoning:0 months YE 2020 Occupancy(4):49.2%
Maturity Date:July 11, 2031 YE 2019 Occupancy(4):93.7%
IO Period:120 months YE 2018 Occupancy(4):60.8%
Loan Term (Original):120 months As-Is Appraised Value(5):$129,800,000
Amortization Term (Original):NAP As-Is Appraised Value Per SF(5):$114.79
Loan Amortization Type:Interest Only As-Is Appraisal Valuation Date:April 26, 2021
Call Protection(2):L(24),D(92),O(4)   
Lockbox Type:Hard/In Place Underwriting and Financial Information(6)
Additional Debt:Yes TTM NOI(7):NAV
Additional Debt Type (Balance):Pari Passu/Mezzanine ($10,000,000/$10,000,000) YE 2020 NOI(7):NAV
  YE 2019 NOI(7):NAV
   YE 2018 NOI(7):NAV
   U/W Revenues:$9,346,779
   U/W Expenses:$2,274,576
Escrows and Reserves(3) U/W NOI:$7,072,203
 InitialMonthlyCap U/W NCF:$6,676,429
Taxes$234,923$78,308NAP U/W DSCR based on NOI/NCF(1):2.88x / 2.72x
Insurance$0SpringingNAP U/W Debt Yield based on NOI/NCF(1):9.4% / 8.9%
Replacement Reserve$0$9,423NAP U/W Debt Yield at Maturity based on NOI/NCF:9.4% / 8.9%
Leasing Reserve$0$23,558NAP Cut-off Date LTV Ratio(1):57.8%
Upfront Leasing Reserve$4,000,000$0NAP LTV Ratio at Maturity:57.8%
Gap Rent Reserve$784,601$0NAP   
       
        
Sources and Uses
Sources    Uses   
Original loan amount$75,000,000 88.2% Loan payoff(8)$70,404,507 82.8%
Mezzanine Loan10,000,000 11.8    Upfront reserves5,019,524 5.9   
     Closing costs1,315,870 1.6   
     Return of equity8,260,099 9.7   
Total Sources$85,000,000 100.0% Total Uses$85,000,000 100.0%
(1)The Cut-off Date Balance Per SF, U/W Debt Yield Based on NOI, U/W DSCR based on NCF, and Cut-off Date LTV Ratio based on the Velocity Industrial Portfolio Whole Loan (as defined below) and the Velocity Industrial Portfolio Mezzanine Loan (as defined below) are $75, 8.3%, 1.92x, and 65.5%, respectively. See “Additional Secured Indebtedness (not including trade debts)” below.
(2)At any time after the earlier of (i) June 28, 2025 and (ii) two years from the closing date of the securitization that includes the last pari passu note of the Velocity Industrial Portfolio Whole Loan to be securitized, and prior to April 11, 2031, the borrower has the right to defease the Velocity Industrial Portfolio Whole Loan in whole, but not in part.
(3)See “Escrows” section.
(4)Information obtained from a third party report and represents combined occupancy as of the fourth quarter.
(5)The appraisal for the 1180 Church Road Property (as defined below) excludes an excess parking area that is subject to a free release. See “Partial Release” below.
(6)While the Velocity Industrial Portfolio Whole Loan (as defined below) 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 Velocity Industrial Portfolio Whole Loan more severely than assumed in the underwriting of the Velocity Industrial Portfolio Whole Loan. The pandemic and resulting economic disruption could also 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.
(7)The Velocity Industrial Portfolio Borrower (as defined below) purchased the 2750 Morris Road Property (as defined below) in September 2020 and the 1180 Church Road Property in December 2020. Historical operating performance is not available.
(8)Includes preferred equity buyout of $31,869,599 to JCR Capital.

 

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.

 

38

 

 

Industrial - WarehouseLoan #1Cut-off Date Balance: $65,000,000

Property Addresses – Various 

Lansdale, PA 19446 

Velocity Industrial PortfolioCut-off Date LTV: 57.8%
  U/W NCF DSCR: 2.72x
  U/W NOI Debt Yield: 9.4%

 

 

The Mortgage Loan. The largest mortgage loan (the “Velocity Industrial Portfolio Mortgage Loan”) is part of a whole loan (the “Velocity Industrial Portfolio Whole Loan”) that is evidenced by three pari passu promissory notes in the aggregate original principal amount of $75,000,000. The Velocity Industrial Portfolio Whole Loan is secured by a first priority fee mortgage encumbering two industrial properties totaling 1,130,782 square feet, located in Lansdale, Pennsylvania (the “Velocity Industrial Portfolio Properties”). The Velocity Industrial Portfolio Whole Loan will be serviced under the pooling and servicing agreement for the WFCM 2021-C60 securitization trust. See “Description of the Mortgage Pool—The Whole Loans—The Serviced Pari Passu Whole Loans” and “Pooling and Servicing Agreement” in the Preliminary Prospectus.

 

Note Summary

 

NotesOriginal BalanceCut-off Date BalanceNote HolderControlling Piece
A-1$60,000,000$60,000,000WFCM 2021-C60Yes
A-2$10,000,000$10,000,000WFBNo
A-3$5,000,000$5,000,000WFCM 2021-C60No
Total$75,000,000$75,000,000  

 

The Borrowers and Borrower Sponsors. The borrowers comprise two single purpose entities: VV2750 LLC and VVChurch LLC (collectively, the “Velocity Industrial Portfolio Borrower”), each a Delaware limited liability company. The Velocity Industrial Portfolio Borrower has two independent directors and legal counsel to the Velocity Industrial Portfolio Borrower delivered a non-consolidation opinion in connection with the origination of the Velocity Industrial Portfolio Whole Loan. The borrower sponsors and nonrecourse carve-out guarantors of the Velocity Industrial Portfolio Whole Loan are Zachary Moore and Anthony Grelli, Jr.

 

Mr. Moore and Mr. Grelli are founding partners of Velocity Ventures. Velocity Ventures is a Philadelphia-based investment firm that specializes in the acquisition and management of opportunistic industrial real estate assets in the greater Philadelphia area. The company currently owns and manages over 4.0 million square feet of industrial space in the greater Philadelphia area.

 

The Properties. The Velocity Industrial Portfolio Properties comprise two, class B industrial warehouse properties totaling 1,130,782 square feet located in Lansdale, Pennsylvania. As of June 23, 2021, the portfolio is 89.3% leased to 11 tenants.

 

2750 Morris Road

 

The 2750 Morris Road Property is a 681,126 square foot, industrial building located in Lansdale, Pennsylvania (the “2750 Morris Road Property”). Originally constructed in 1989 and renovated between 2015 and 2021, the 2750 Morris Road Property offers recently renovated fully climate-controlled manufacturing space. The net rentable area contains approximately 84.3% warehouse space with 21’-23.5’ clear heights, 35 dock height loading doors and 7 drive-in doors. The remaining 15.7% of the building is an office suite. The 2750 Morris Road Property is situated on an approximately 84.5-acre site and includes 1,448 surface parking spaces (2.1 spaces per 1,000 square feet). The Velocity Industrial Portfolio Borrower purchased the 2750 Morris Road Property in September 2020 for $33 million, when it was 57% leased. As of June 23, 2021 the 2750 Morris Road Property was 89.5% leased to six tenants.

 

1180 Church Road

 

The 1180 Church Road Property is a 449,656 square feet, industrial building located in Lansdale, Pennsylvania (the “1180 Church Road Property”). Originally constructed in 1966 and renovated in 2021, the net rentable area contains approximately 63.2% warehouse with 20’-24’ clear heights, 8 dock height loading doors and 3 drive-in doors. The remaining 36.8% of the building is office space. The 1180 Church Road Property is situated on an approximately 37.2-acre site and includes 1,416 surface parking spaces (3.1 spaces per 1,000 square feet). The Velocity Industrial Portfolio Borrower purchased the 1180 Church Road Property for $19.5 million in December 2020, when it was 50% leased. As of June 23, 2021 the 1180 Church Road Property was 88.9% leased to five tenants.

 

The 1180 Church Road Property is one of nine units within a land condominium regime, an alternative to land subdivision. The related owners’ association is responsible for maintenance of a road, detention pond and shared stormwater drainage, and has no building maintenance responsibilities. The Velocity Industrial Portfolio Borrower has a 51.47% voting rights interest in the owners’ association, and the ability to appoint a majority of members to the association’s board of directors.

 

The following table presents certain information relating to the Velocity Industrial Portfolio Properties:

 

Property Name – LocationAllocated
Whole Loan
Cut-off Date
Balance
% of
Portfolio
Cut-off Date Balance
OccupancyYear Built/ RenovatedNet
Rentable
Area (SF)
As-Is
Appraised
Value
Allocated Cut-off Date LTV% of
UW NOI
Parking Ratio (per 1,000 SF)

2750 Morris Road

Lansdale, PA

$42,369,02156.5%89.5%1989/2021681,126$74,400,00056.9%60.2%2.1

1180 Church Road

Lansdale, PA

$32,630,97943.5%88.9%1966/2021449,656$55,400,00058.9%39.8%3.1
Total/Weighted Average$75,000,000100.0%89.3% 1,130,782$129,800,00057.8%100.0%2.5

 

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.

 

39

 

 

Industrial - WarehouseLoan #1Cut-off Date Balance: $65,000,000

Property Addresses – Various 

Lansdale, PA 19446 

Velocity Industrial PortfolioCut-off Date LTV: 57.8%
  U/W NCF DSCR: 2.72x
  U/W NOI Debt Yield: 9.4%

 

 

Major Tenants.

 

Organon & Co. (125,127 square feet; 11.1% of net rentable area; 20.2% of underwritten base rent; December 31, 2022 lease expiration) – Organon & Co. is a global healthcare company formed through a spinoff from Merck, to focus on improving the health of women throughout their lives. The company has more than 60 medicines and other products across a range of areas including reproductive health, heart disease, dermatology, allergies and asthma. Headquartered in Jersey City, New Jersey, Organon & Co. employs approximately 9,000 people and serves over 140 markets internationally.

 

Organon & Co. has been a tenant at the 1180 Church Road Property since 2005 and 100% of its space is classified as office. The tenant recently spent $18 million, approximately $144 per square foot, of their own money to upgrade their space. Organon & Co. has two, one-year renewal options at 2% above the base rent payable during the last month of the prior term, with six months’ notice. The tenant also pays approximately $240,000 for parking per year.

 

Keystone Technologies (248,104 square feet; 21.9% of net rentable area; 18.9% of underwritten base rent; March 31, 2031 lease expiration) – Keystone Technologies was founded in 1945 and manufacturing and delivers a variety of lighting products including LED, HID, and fluorescent products, transformers, sign solutions, sensors, and emergency back-up systems. The company operates out of 17 warehouse locations and guarantees next day delivery.

 

Keystone Technologies has been a tenant at the 2750 Morris Road Property since 2019, originally occupying 160,326 square feet. The tenant subsequently expanded into an additional 87,778 square feet in April and September 2021, and extended the original lease through March 31, 2031. The tenant has one, five-year renewal option at 95% of the fair market rent, with six months’ notice.

 

Jillamy (152,827 square feet; 13.5% of net rentable area; 13.3% of underwritten base rent; August 31, 2026 lease expiration) – Jillamy’s lease at the 2750 Morris Road Property commenced on December 18, 2020, with rent payments beginning on September 1, 2021. Jillamy was founded in 2001 and is a full service third party logistics provider with a full complement of freight forwarding solutions including a customs brokerage as well as packaging and warehouse services.

 

The following table presents certain information relating to the tenancy at the Velocity Industrial Portfolio Properties:

 

Major Tenants

 

Tenant Name (Property)

Credit Rating (Fitch/

Moody’s/
S&P)

Tenant
NRSF
% of
NRSF
Annual
U/W Base
Rent
PSF(1)
Annual
U/W Base
Rent(1)
% of Total Annual
U/W Base
Rent
Lease
Expiration
Date
Extension OptionsTermination Option (Y/N)
Major Tenants        
Organon & Co.NR/NR/NR125,12711.1%$10.42$1,303,580(2)20.2%12/31/20222, 1- yearN
Keystone TechnologiesNR/NR/NR248,10421.9%$4.90$1,216,93218.9%3/31/20311, 5-yearN
JillamyNR/NR/NR152,82713.5%$5.61$857,35913.3%8/31/2026NoneN
Hughes Relocation ServicesNR/NR/NR127,66111.3%$5.50$702,13610.9%1/31/20343, 3-yearN
Total Major Tenants653,71957.8%$6.24$4,080,00663.2%   
         
Non-Major Tenant355,86231.5%$6.67$2,373,45736.8%   
         
Occupied Collateral Total1,009,58189.3%$6.39$6,453,463100.0%   
         
Vacant Space121,20110.7%      
         
Collateral Total1,130,782100.0%      
          

 

(1)Annual U/W Base Rent PSF and Annual U/W Base Rent include contractual rent steps through June 2022 totaling $150,763.
(2)The Organon & Co. space is classified as 100% office. Additionally, the Annual U/W Base Rent includes $240,000 for parking (the free release of excess parking area at the 1180 Church Road Property does not impact related lease obligations).

 

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.

 

40

 

Industrial - WarehouseLoan #1Cut-off Date Balance: $65,000,000

Property Addresses – Various 

Lansdale, PA 19446 

Velocity Industrial PortfolioCut-off Date LTV: 57.8%
  U/W NCF DSCR: 2.72x
  U/W NOI Debt Yield: 9.4%

 

 

The following table presents certain information relating to the lease rollover schedule at the Velocity Industrial Portfolio Properties:

 

Lease Expiration Schedule(1)(2)

 

Year Ending
 December 31,
No. of
Leases
Expiring
Expiring
NRSF
% of
Total
NRSF
Cumulative Expiring
NRSF
Cumulative
% of Total
NRSF
Annual
 U/W
Base Rent
% of Total
Annual
U/W Base
Rent
Annual
 U/W
Base Rent
 PSF
MTM000.0%00.0%$00.0%$0.00
2021000.0%00.0%$00.0%$0.00
20223167,12714.8%167,12714.8%$1,766,42027.4%$10.57
2023299,4328.8%266,55923.6%$648,39210.0%$6.52
2024277,9266.9%344,48530.5%$585,8639.1%$7.52
2025168,0006.0%412,48536.5%$302,6004.7%$4.45
20261152,82713.5%565,31250.0%$857,35913.3%$5.61
2027000.0%565,31250.0%$00.0%$0.00
2028000.0%565,31250.0%$00.0%$0.00
2029167,4666.0%632,77856.0%$373,7625.8%$5.54
2030000.0%632,77856.0%$00.0%$0.00
20313248,10421.9%880,88277.9%$1,216,93218.9%$4.90
Thereafter(3)2128,69911.4%1,009,58189.3%$702,13610.9%$5.46
Vacant0121,20110.7%1,130,782100.0%$00.0%$0.00
Total/Weighted Average151,130,782100.0%  $6,453,463100.0%$6.39

 

(1)Information obtained from the underwritten rent roll.
(2)Certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date of the subject lease and that are not considered in the Lease Expiration Schedule.
(3)Includes 1,038 square feet of space leased to Amazon with no associated rent or expiration date.

 

The following table presents historical occupancy percentages at the Velocity Industrial Portfolio Properties:

 

Historical Occupancy

 

12/31/2018(1)

12/31/2019(1)

12/31/2020(1)

6/23/2021(2)

60.8%93.7%49.2%89.3%

 

(1)Information obtained from a third-party market research provider and represents occupancy as of the fourth quarter of each year.
(2)Information obtained from the underwritten rent roll.

 

COVID-19 Update. As of June 29, 2021, the Velocity Industrial Portfolio Properties are open and operating. Approximately 100.0% of tenants by underwritten base rent and 100.0% of tenants by square footage paid full rent in May and June. The first payment date for the Velocity Industrial Portfolio Whole Loan will be August 11, 2021.

 

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.

 

41

 

Industrial - WarehouseLoan #1Cut-off Date Balance: $65,000,000

Property Addresses – Various 

Lansdale, PA 19446 

Velocity Industrial PortfolioCut-off Date LTV: 57.8%
  U/W NCF DSCR: 2.72x
  U/W NOI Debt Yield: 9.4%

 

 

Underwritten Net Cash Flow. The following table presents certain information relating to the underwritten net cash flow at the Velocity Industrial Portfolio Properties:

 

Cash Flow Analysis(1)

 

 U/W%(2)U/W $ per SF
Base Rent(3)(4)$7,268,37471.5%$6.43
Grossed Up Vacant Space

0

0.0

0.00

Gross Potential Rent$7,268,37471.5%$6.43
Other Income(5)250,0002.50.22
Parking/Garage/Other(6)733,2007.20.65
Total Recoveries

1,910,116

18.8

1.69

Net Rental Income$10,161,690100.0%$8.99
(Vacancy & Credit Loss)

(814,911)

(11.2)

(0.72)

Effective Gross Income$9,346,77992.0%$8.27
    
Real Estate Taxes985,30510.50.87
Insurance158,3221.70.14
Management Fee280,4033.00.25
Other Operating Expenses

850,546

9.1

0.75

Total Operating Expenses$2,274,57624.3%$2.01
    
Net Operating Income$7,072,20375.7%$6.25
Replacement Reserves113,0781.20.10
TI/LC

282,696

3.0

0.25

Net Cash Flow$6,676,42971.4%$5.90
    
NOI DSCR(7)2.88x  
NCF DSCR(7)2.72x  
NOI Debt Yield(7)9.4%  
NCF Debt Yield(7)8.9%  

 

(1)The Velocity Industrial Portfolio Borrower purchased the 2750 Morris Road Property in September 2020 and the 1180 Church Street Property in December 2020. Historical operating performance is not available.
(2)Represents (i) percent of Net Rental Income for all revenue fields, (ii) percent of Gross Potential Rent for Vacancy & Credit Loss and (iii) percent of Effective Gross Income for all other fields.
(3)Base Rent includes contractual rent steps through June 2022 totaling $150,763.
(4)Base Rent includes underwritten rent for Jillamy, representing 13.5% of net rentable area, with rent beginning in September 1, 2021. Free rent associated with the lease was reserved at loan origination. Additionally, Base Rent includes Keystone Technologies expansion space, representing 3.5% of net rentable area, with a lease beginning October 1, 2021, and Hughes Relocation Services, representing 11.3% of net rentable area, with a lease beginning August 1, 20121. Free rent and gap rent associated with these leases was reserved at loan origination.
(5)Other Income includes income from a diesel-powered electricity generating facility at the 2750 Morris Road Property that is leased to PECO.
(6)Parking/Garage/Other income relates to a parking lease with Amazon at the 2750 Morris Road Property for the use of 611 parking spaces, with a lease expiration of May 30, 2030. Amazon may terminate the lease after the 84th month of the term (August 1, 2027).
(7)The NOI and NCF DSCR and the NOI and NCF Debt Yield are based on the Velocity Industrial Portfolio Whole Loan.

 

Appraisal. As of April 26, 2021, the appraiser concluded to as-is market values of $74.4 million for the 2750 Morris Road Property, and $55.4 million for the 1180 Church Road Property (excluding the excess parking area that is subject to a free release). The aggregate appraised value for the Velocity Industrial Portfolio Properties is $129.8 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.

 

42

 

Industrial - WarehouseLoan #1Cut-off Date Balance: $65,000,000

Property Addresses – Various 

Lansdale, PA 19446 

Velocity Industrial PortfolioCut-off Date LTV: 57.8%
  U/W NCF DSCR: 2.72x
  U/W NOI Debt Yield: 9.4%

 

 

Environmental Matters. The Phase I environmental site assessments dated December 8, 2020 (1180 Church Road Property) and August 12, 2020 (2750 Morris Road Property) identified a controlled recognized environmental condition (CREC) related to the 1180 Church Road Property’s inclusion within the U.S. EPA North Penn Area 7 Superfund site. No further action was recommended other than ongoing compliance with due care requirements, including limiting the 1180 Church Road Property to commercial and industrial uses and prohibiting the extraction or use of groundwater. See “Description of the Mortgage Pool – Environmental Considerations” in the Preliminary Prospectus.

 

Market Overview and Competition. The Velocity Industrial Portfolio Properties are located in Lansdale, Pennsylvania, within Montgomery County. The Velocity Industrial Portfolio Properties are located 3.3 miles from one another and are approximately 27.0 miles north of the Philadelphia central business district. The Velocity Industrial Portfolio Properties are located within 4.5 miles of I-476 and 14.4 miles of I-276. Additionally, the Velocity Industrial Portfolio Properties are within 6.4 miles of Pennsylvania Route 309, and the 1180 Church Road Property is located approximately 0.6 miles to the SEPTA Pennbrook train station.

 

According to a third party market research report, the Velocity Industrial Portfolio Properties are situated within the East Montgomery City Industrial submarket of the Philadelphia Industrial market. As of March 5, 2021 the submarket reported a total inventory of approximately 61.2 million square feet with a 6.3% vacancy rate. The appraisal identified six comparable industrial buildings, which reported an average occupancy rate of approximately 100% with an average rental rate of $5.80 per square foot. The appraiser identified six comparable office leases with an average rental rate of $12.73 per square foot.

 

The following table presents certain information relating to the appraiser’s market rent conclusions for the 2750 Morris Road Property:

 

Market Rent Summary(1)

 

 Valmet Off/IndFlexWarehouseOfficeOffice – Former
Café Space
Market Rent (PSF)$9.25$6.50$5.50$10.00$9.50
Lease Term (Years)55555
Lease Type (Reimbursements)NetNetNetNetNet
Rent Increase Projection2.5% per annum2.5% per annum2.5% per annum2.5% per annum2.5% per annum
(1)Information obtained from the appraisal.

 

The following table presents certain information relating to the appraiser’s market rent conclusions for the 1180 Church Road Property:

 

Market Rent Summary(1)

 

 FlexWarehouseOffice
Market Rent (PSF)$7.50$5.50$9.00
Lease Term (Years)555
Lease Type (Reimbursements)NetNetNet
Rent Increase Projection2.5% per annum2.5% per annum2.5% per annum
(1)Information obtained from the appraisal.

 

The table below presents certain information relating to comparable sales, which pertain to all of the Velocity Industrial Portfolio Properties identified by the appraiser:

 

Comparable Sales(1)

 

Property NameLocationRentable
Area (SF)
Sale DateSale PriceSale Price
(PSF)
Interstate Business ParkBellmawr, NJ131,500Mar-21$11,975,000$91.06
Ferguson Enterprises BuildingPhiladelphia, PA86,325May-20$8,750,000$101.36
South Jersey Industrial PortfolioSwedesboro, NJ556,707Apr-20$42,925,000$77.11
AmeriSource BuildingWest Deptford Township, NJ191,500Mar-20$20,200,000$105.48
Bishops Gate Corporate CenterMount Laurel, NJ292,466Jan-20$32,200,000$110.10
(1)Information obtained from the appraisals.

 

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.

 

43

 

Industrial - WarehouseLoan #1Cut-off Date Balance: $65,000,000

Property Addresses – Various 

Lansdale, PA 19446 

Velocity Industrial PortfolioCut-off Date LTV: 57.8%
  U/W NCF DSCR: 2.72x
  U/W NOI Debt Yield: 9.4%

 

 

The following table presents certain information relating to comparable industrial leases related to the Velocity Industrial Portfolio Properties:

 

Comparable Industrial Leases(1)

 

Property Name/LocationYear Built/ RenovatedTotal GLA
(SF)
OccupancyTenantTenant
Size (SF)
Lease
Start
Date
Lease TermAnnual
Base
Rent PSF
Lease Type

2750 Morris Road

Lansdale, PA (subject)

1989/2021681,126(2)89.5%(2)Jillamy(2)152,827(2)Dec-20(2)5.0 Yrs. (2)$5.61(2)Net(2)

1180 Church Road

Lansdale, PA (subject)

1966/2021449,656(2)88.9%(2)Hughes Relocation Services(2)127,661(2)Aug-21(2)12.5 Yrs. (2)$5.50(2)Net(2)

700 Pattison Avenue

Philadelphia, PA

1970/2001288,766100.0%(3)NAV116,000Jan-2110.0 Yrs.$5.50Net

1510 Gehman Road

Harleysville, PA

1990/2011152,625100.0%Deacon Industrial Supply152,625Dec-2010.0 Yrs.$5.60Net

9 Runway Road

Levittown, PA

2004/NAP60,000100.0%Recall Total Information Management, Inc.60,000Sep-205.0 Yrs.$6.25Net

Amazon Building

6300 Bristol Pike

Levittown, PA

1963/NAP149,180100.0%Amazon149,180Aug-2013.0 Yrs.$6.25Net

3601 Island Avenue

Philadelphia, PA

1986/NAP84,400100.0%(3)Stadium Casino30,200Mar-203.0 Yrs.$5.25Net

Bristol Commerce Center

2401 Green Lane

Bristol, PA

2019/NAP308,959100.0%Urban Outfitters, Inc.308,959May-1915.0 Yrs.$5.95Net

(1)           Information obtained from the appraisal. 

(2)           Information obtained from the underwritten rent roll. 

(3)           Information obtained from a third party report.

 

The following table presents certain information relating to comparable office leases related to 2750 Morris Road Property:

 

Comparable Office Leases(1)

 

Property Name/LocationYear Built/
Renovated
Total GLA
(SF)
OccupancyTenantTenant
Size
(SF)
Lease
Start
Date
Lease
Term
Annual Base Rent PSFLease
Type

2750 Morris Road 

Lansdale, PA (subject) 

1989/2021681,126(2)89.5%(2)Valmet(2)41,105(2)Jan-20(2)3.5 Yrs(2)$9.27(2)Net(2)

The Pinnacle 

1684 S. Broad Street 

Lansdale, PA 

1999/NAP344,00071.7%(3)Current Offering96,280May-213.0 Yrs.$8.50Net

1010 West Germantown Pike 

Norristown, PA 

1979/NAP30,000NAVCurrent Offering

5,000

 

May-21

3.0 Yrs.

 

$10.00Net

Wyncote Industrial Commons 

827 Glenside Avenue 

Wyncote, PA 

1900/NAP99,626NAVCurrent Offering13,600May-213.0 Yrs.$10.00Net

Pennsylvania Business Campus 

300-309 Lakeside Drive 

Horsham, PA 

1982/NAP43,832100.0%Jefferson School of Nursing43,882Jul-2015.0 Yrs.$15.85Net

2005 Cabot Boulevard West 

Langhome, PA 

1984/NAP61,96983.3%(3)Penndel Health18,333Jul-197.0 Yrs.$12.00Net

Great Valley Corporate Center

One Great Valley Parkway 

Malvem, PA 

1982/NAP60,880 Phase Bio Pharmaceuticals, Inc.15,881Aug-185.0 Yrs.$15.80Net

(1)Information obtained from the appraisal.
(2)Information obtained from the underwritten rent roll.
(3)Information obtained from a third party report.

 

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.

 

44

 

 

Industrial - WarehouseLoan #1Cut-off Date Balance: $65,000,000

Property Addresses – Various 

Lansdale, PA 19446 

Velocity Industrial PortfolioCut-off Date LTV: 57.8%
  U/W NCF DSCR: 2.72x
  U/W NOI Debt Yield: 9.4%

 

 

Escrows.

 

Real Estate Taxes – The Velocity Industrial Portfolio Whole Loan documents require an upfront real estate tax reserve of $234,923 and ongoing monthly real estate tax reserves in an amount equal to one-twelfth of the real estate taxes that the lender estimates will be payable during the next twelve months (initially $78,308).

 

Insurance – The Velocity Industrial Portfolio Whole Loan documents do not require ongoing monthly escrows for insurance premiums as long as (i) no event of default has occurred and is continuing, (ii) the Velocity Industrial Portfolio Borrower or borrower affiliate provides the lender with evidence that the Velocity Industrial Portfolio Properties’ insurance coverage is included in a blanket policy and such policy is in full force and effect and (iii) the Velocity Industrial Portfolio Borrower pays all applicable insurance premiums and provides the lender with evidence of payment of insurance premiums/renewals no later than ten business days prior to the expiration of the policies.

 

Replacement Reserve – The Velocity Industrial Portfolio Whole Loan documents require ongoing monthly replacement reserves of $9,423.

 

Leasing Reserve – The Velocity Industrial Portfolio Whole Loan documents require ongoing monthly general TI/LC reserves of $23,558.

 

Upfront Leasing Reserve – The Velocity Industrial Portfolio Whole Loan documents require an upfront tenant improvements and leasing commissions (“TI/LC”) reserve of $4,000,000 (the “Upfront Leasing Reserve”).

 

Provided that no event of default then exists, the Upfront Leasing Reserve will be disbursed to the Velocity Industrial Portfolio Borrower upon the satisfaction of the following conditions:

 

(i)no Cash Trap Event Period (as defined below) then exists;

(ii)the Combined NCF DSCR (as defined below) is equal to or greater than 0.825 to 1.00;

(iii)Organon & Co. has renewed its lease for a term of no less than five years at a rental rate no less than the rental rate in effect prior to such renewal; and
(iv)all leasing expenses incurred in connection with such renewal have been paid in full and the tenant is in occupancy and paying full, unabated rent.

 

“Combined NCF DSCR” means, assuming a mortgage loan constant of ten percent, the net cash flow divided by the combined debt service of the Velocity Industrial Portfolio Whole Loan and the debt service due under the mezzanine loan payable during the subsequent twelve month period.

 

Gap Rent Reserve – The Velocity Industrial Portfolio Whole Loan documents require an upfront reserve of $784,601 for gap rent related to certain existing leases which will be disbursed in accordance with the Velocity Industrial Portfolio Whole Loan documents.

 

Lockbox and Cash Management. The Velocity Industrial Portfolio Whole Loan requires a hard lockbox and in-place cash management. The Velocity Industrial Portfolio Borrower is required to cause all rents to be deposited directly into the lockbox account, and all rents received by the Velocity Industrial Portfolio Borrower or property manager be deposited into the lockbox account within two business days of receipt. Funds in the deposit account will be swept periodically into a cash management account and, prior to a Cash Trap Event Period, any funds remaining in the cash management account after the cash flow waterfall will be transferred to the Velocity Industrial Portfolio Borrower. During a Cash Trap Event Period, any excess cash flow remaining after satisfaction of the waterfall items outlined in the Velocity Industrial Portfolio Whole Loan documents is required to be swept to an excess cash flow subaccount to be held as additional collateral for the Velocity Industrial Portfolio Whole Loan, unless the Cash Trap Event Period is caused solely by the continuance of a mezzanine loan event of default, in which case excess cash flow will be disbursed to or at the direction of the mezzanine lender in accordance with the disbursement instructions provided by the mezzanine lender.

 

A “Cash Trap Event Period” will commence upon the earlier of the following:

 

(i)the occurrence and continuance of an event of default;

(ii)the Combined NCF DSCR being less than 0.70 to 1.00;
(iii)the occurrence of a Specified Tenant Cash Trap Event Period (as defined below); or
(iv)the occurrence and continuance of a mezzanine loan event of default.

 

A “Specified Tenant Cash Trap Event Period” means (a) a Specified Tenant (as defined below) vacates, abandons, or otherwise goes dark in its leased space, or gives notice of its intent to do so, or (b) a Specified Tenant has not renewed its lease twelve months prior to the scheduled expiration of its 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.

 

45

 

Industrial - WarehouseLoan #1Cut-off Date Balance: $65,000,000

Property Addresses – Various 

Lansdale, PA 19446 

Velocity Industrial PortfolioCut-off Date LTV: 57.8%
  U/W NCF DSCR: 2.72x
  U/W NOI Debt Yield: 9.4%

 

 

A Specified Tenant Cash Trap Event Period will end upon the occurrence of the following:

 

With regard to clause (a) receipt of evidence that the applicable Specified Tenant has renewed or extended its lease or entered into a new lease, in each case for a term of at least five years at terms approved by the lender, with no outstanding landlord obligations, and has taken possession of, and resumed operations in all of the leased space and is paying full, unabated rent;

With regard to a Specified Tenant terminating the applicable lease, receipt, in writing, of the Specified Tenant revoking its termination and reaffirming its lease; or
With regard to clause (b) the entire space leased to the Specified Tenant has been leased to one or more replacement tenants acceptable to the lender, at terms approved by the lender, with no outstanding landlord obligations, and each replacement tenant is in occupancy, open for business and paying full, unabated rent.

 

A “Specified Tenant” means together with any guarantor of its lease, sublease or other occupancy agreement, (i) Organon & Co. (ii) Keystone Technologies, LLC, and (iii) any replacement tenant occupying all or a portion of the space leased to a Specified Tenant as of the date of the Velocity Industrial Portfolio Whole Loan agreement, pursuant to a replacement lease entered into in accordance with the terms of the Velocity Industrial Portfolio Whole Loan agreement.

 

A Cash Trap Event Period will end upon the occurrence of the following:

 

with regard to clause (i), the cure of such event of default;

with regard to clause (ii), the Combined NCF DSCR being greater than or equal to 0.80 to 1.00 for two consecutive calendar quarters;
With regard to clause (iii), the expiration of a Specified Tenant Cash Trap Event Period; or

With regard to clause (iv), the receipt of notice from the mezzanine lender that all mezzanine loan events of default have been cured.

 

Property Management. The Velocity Industrial Portfolio Properties are managed by Last Mile Management LLC.

 

Partial Release. The Velocity Industrial Portfolio Borrower can obtain the free release of an excess parking area (approximately 5.0 acres) at the 1180 Church Street Property in connection with an arms-length, third party sale, subject to the certain  conditions, including (i) the remaining properties’ having a loan-to-value no greater than that at the time of loan origination, and a debt yield no less than that at the time of loan origination, (ii) ongoing compliance with lease and zoning requirements, and (iii) an opinion of counsel that the partial release satisfies REMIC requirements.

 

Real Estate Substitution. Not permitted.

 

Subordinate and Mezzanine Indebtedness. Concurrently with the origination of the Velocity Industrial Portfolio Whole Loan, Wells Fargo Bank made a $10,000,000 mezzanine loan (the “Velocity Industrial Portfolio Mezzanine Loan”) to the sole member of the Velocity Industrial Portfolio Borrower, which is secured by the sole member’s ownership interest in the Velocity Industrial Portfolio Borrower. The Velocity Industrial Portfolio Mezzanine Loan is coterminous with the Velocity Industrial Portfolio Whole Loan and is subject to an intercreditor agreement. The Velocity Industrial Portfolio Mezzanine Loan accrues interest at a fixed per annum rate equal to 10.000% and is interest-only through the Velocity Industrial Portfolio Whole Loan term. See “Description of the Mortgage Pool– Additional Indebtedness-Mezzanine Indebtedness” in the Preliminary Prospectus.

 

The following table presents certain information relating to the Velocity Industrial Portfolio Mezzanine Loan:

 

 

Mezzanine Loan

Original Principal

Balance

Mezzanine Loan 

Interest Rate

Original Term (mos.)

Original Amort.

Term (mos.)

Original IO 

Term (mos.)

Total Debt UW 

NCF DSCR

Total Debt UW

NOI Debt Yield

Total Debt Cutoff

Date LTV

Velocity Industrial Portfolio Mezzanine Loan$10,000,00010.000%12001201.92x8.3%65.5%

 

Ground Lease. None.

 

Terrorism Insurance. The Velocity Industrial Portfolio Whole Loan documents require that the “all risk” insurance policy required to be maintained by the Velocity Industrial Portfolio Borrower provides coverage for terrorism in an amount equal to the full replacement cost of the Velocity Industrial Portfolio Properties, as well as business interruption insurance covering no less than the 18-month period following the occurrence of a casualty event, together with a 6-month extended period of indemnity. 

 

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.

 

46

 

 

(THIS PAGE INTENTIONALLY LEFT BLANK) 

 

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.

 

47

 

 

Office - CBDLoan #2Cut-off Date Balance: $50,000,000
1114 Avenue of the AmericasThe Grace BuildingCut-off Date LTV: 41.1%
New York, NY 10036 U/W NCF DSCR: 4.25x
  U/W NOI Debt Yield: 11.8%

 

(GRAPHIC) 

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.

 

48

 

 

Office - CBDLoan #2Cut-off Date Balance: $50,000,000
1114 Avenue of the AmericasThe Grace BuildingCut-off Date LTV: 41.1%
New York, NY 10036 U/W NCF DSCR: 4.25x
  U/W NOI Debt Yield: 11.8%

 

(GRAPHIC)

 

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.

 

49

 

 

Office - CBDLoan #2Cut-off Date Balance: $50,000,000
1114 Avenue of the AmericasThe Grace BuildingCut-off Date LTV: 41.1%
New York, NY 10036 U/W NCF DSCR: 4.25x
  U/W NOI Debt Yield: 11.8%

 

(GRAPHIC)

 

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.

 

50

 

 

No. 2 – The Grace Building
        
Mortgage Loan Information Mortgaged Property Information
Mortgage Loan Seller:Column Financial, Inc. Single Asset/Portfolio:Single Asset

Credit Assessment 

(DBRSM/Fitch/Moody’s):

A/A-/Baa2 Property Type – Subtype:Office – CBD
Original Principal Balance(1):$50,000,000 Location:New York, NY
Cut-off Date Balance(1):$50,000,000 Size:1,556,972 SF
% of Initial Pool Balance:6.7% Cut-off Date Balance Per SF:$567.13
Loan Purpose:Refinance Maturity Date Balance Per SF:$567.13
Borrower Sponsor:Brookfield Office Properties, Inc. Year Built/Renovated:1974/2018
Guarantors:BOP NYC OP LLC and Swig Investment Company, LLC Title Vesting:Fee
Interest Rate:2.6921% Property Manager:TRZ Holdings IV LLC
Note Date:November 17, 2020 Current Occupancy (As of):94.8% (10/19/2020)
Seasoning:7 months YE 2019 Occupancy:91.0%
Maturity Date:December 6, 2030 YE 2018 Occupancy:97.6%
IO Period:120 months YE 2017 Occupancy:94.7%
Loan Term (Original):120 months As-Is Appraised Value:$2,150,000,000
Amortization Term (Original):NAP As-Is Appraised Value Per SF:$1,380.89
Loan Amortization Type:Interest Only As-Is Appraisal Valuation Date:September 8, 2020
Call Protection(2):L(31),DorYM1(82),O(7)   
Lockbox Type:Hard/Springing Cash Management   
Additional Debt(1):Yes   
Additional Debt Type (Balance):

Pari Passu ($833,000,000); 

Subordinate ($367,000,000); 

Future Mezzanine

 Underwriting and Financial Information(3)
  TTM NOI (9/30/2020)(4):$46,272,539
  YE 2019 NOI(4):$52,538,193
   YE 2018 NOI(4):$73,206,664
   YE 2017 NOI(4):$67,159,674
   U/W Revenues:$157,612,989
   U/W Expenses:$53,319,272
Escrows and Reserves U/W NOI(4):$104,293,717
 InitialMonthlyCap U/W NCF:$102,347,502
Taxes$0SpringingNAP U/W DSCR based on NOI/NCF:4.33x / 4.25x
Insurance$0SpringingNAP U/W Debt Yield based on NOI/NCF:11.8% / 11.6%
Replacement Reserve$0SpringingNAP U/W Debt Yield at Maturity based on NOI/NCF:11.8% / 11.6%
TI/LC Reserve$56,172,399SpringingNAP Cut-off Date LTV Ratio:41.1%
Free Rent$25,964,570$0NAP LTV Ratio at Maturity:41.1%
Parking Rent$1,608,940$0NAP   
Lobby/Elevator Work$5,970,240$0NAP   

 

Sources and Uses
Sources       Uses      
A Notes: $883,000,000  70.6% Loan Payoff(5) $905,439,802  72.4%
B Notes: 367,000,000  29.4  Return of equity 239,965,013  19.2 
        Upfront reserves 89,716,149  7.2 
        Closing costs 14,879,035  1.2 
Total Sources $1,250,000,000  100.0% Total Uses $1,250,000,000  100.0%

 

(1)The Grace Building Mortgage Loan (as defined below) is part of a larger split whole loan evidenced by 21 senior pari passu notes with an aggregate Cut-off Date balance of $883.0 million (collectively, “The Grace Building A Notes”) and four pari passu promissory notes that are subordinate to The Grace Building A Notes with an aggregate Cut-off Date balance of $367.0 million (collectively, “The Grace Building B Notes”, and together with The Grace Building A Notes, “The Grace Building Whole Loan”). The financial information presented in the chart above and herein reflects the aggregate balance of The Grace Building A Notes. The Grace Building Whole Loan was co-originated by Bank of America, N.A. (“BANA”), JPMorgan Chase Bank, National Association (“JPM”), Column Financial, Inc. (“Column”), and DBR Investments Co. Limited (“DBRI”). Column will be contributing Notes A-3-3 and A-3-5, in the original principal amount of $50,000,000.

(2)On and after the defeasance lockout expiration date, The Grace Building Whole Loan may be voluntarily prepaid with, if such a prepayment is made prior to June 6, 2030, a prepayment fee equal to the greater of the yield maintenance amount or 1% of the unpaid principal balance as of the prepayment date.

(3)While The Grace Building 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 Grace Building Whole Loan more severely than assumed in the underwriting of The Grace Building 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 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.

 

51

 

 

Office - CBDLoan #2Cut-off Date Balance: $50,000,000
1114 Avenue of the AmericasThe Grace BuildingCut-off Date LTV: 41.1%
New York, NY 10036 U/W NCF DSCR: 4.25x
  U/W NOI Debt Yield: 11.8%

 

(4)The volatility in cash flow at The Grace Building Property (as defined below) is a result of the replacement of some larger legacy tenants (including 4 of the 5 largest tenants) between 2016 and 2018 and the signing of new and renewal leases with respect to 950,000 square feet of space. The cash flow declines reflected in 2019 and in 9/30/2020 TTM and the projected increase in UW cash flows are the result of this rollover and of the rent abatements associated with the new leases. All outstanding landlord obligations ($56,172,399) and rent abatements ($25,964,570) were reserved at origination.

(5)Loan Payoff includes defeasance costs for previously securitized debt in the GRACE 2014-GRCE securitization trust.

 

The Mortgage Loan. The Grace Building mortgage loan ( “The Grace Building Mortgage Loan”) is part of a whole loan (“The Grace Building Whole Loan”) that is evidenced by 21 pari passu senior promissory notes with an aggregate original principal balance and outstanding principal balance as of the Cut-off Date of $883,000,000 (collectively, “The Grace Building Senior Loan”) and four pari passu subordinate promissory notes in the aggregate original principal balance and outstanding principal balance as of the Cut-off Date of $367,000,000 (collectively, “The Grace Building Subordinate Companion Loan”). The Grace Building Whole Loan is secured by the borrower’s first priority fee simple mortgage encumbering a Class A office building located in New York, New York (“The Grace Building Property”). The Grace Building Mortgage Loan is comprised of the non-controlling notes A-3-3 and A-3-5, which have an aggregate original principal balance and aggregate outstanding principal balance as of the Cut-off Date of $50,000,000.

 

The Grace Building Whole Loan was co-originated by Bank of America, N.A., JPMorgan Chase Bank, National Association, Column Financial, Inc. and DBR Investments Co. Limited on November 17, 2020.

 

Note Summary

 

Notes Original Principal
Balance
 Cut-off Date
Balance
 Note Holder Controlling
Interest
Notes A-1-1, A-2-1, A-3-1, A-4-1 $383,000,000 $383,000,000 GRACE 2020-GRCE Y(1)
Notes A-3-2, A-3-4, A-4-5 60,000,000 60,000,000 CSAIL 2021-C20 N
Note A-1-2 75,000,000 75,000,000 BANK 2020-BNK29 N
Note A-1-3-1 60,000,000 60,000,000 BANK 2020-BNK30 N
Note A-1-3-2 15,000,000 15,000,000 BANK 2021-BNK33 N
Notes A-2-2, A-2-3, A-4-2 100,000,000 100,000,000 BMARK 2020-B21 N
Notes A-2-4, A-4-3 60,000,000 60,000,000 BMARK 2021-B23 N
Notes A-2-5, A-2-6, A-2-7, A-4-4 80,000,000 80,000,000 BMARK 2020-B22 N
Notes A-3-3, A-3-5 50,000,000 50,000,000 WFCM 2021-C60 N
Notes B-1, B-2, B-3, B-4 367,000,000 367,000,000 GRACE 2020-GRCE Y(1)
Total $1,250,000,000 $1,250,000,000    
(1)Pursuant to the related co-lender agreement, the controlling holder is the GRACE 2020-GRCE securitization trust. See “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced AB Whole Loans—The Grace Building Whole Loan” in the Preliminary Prospectus.

 

The Borrower and Borrower Sponsor. The borrowing entity for the loan is 1114 6th Avenue Owner LLC (“The Grace Building Borrower”), a Delaware limited liability company that is structured to be bankruptcy-remote with at least one independent director. The Grace Building Borrower is owned by a joint venture partnership between an affiliate of Swig Investment Company, LLC and 1114 6th Avenue Holdings LLC (controlled and majority indirectly owned by an affiliate of the borrower sponsor, Brookfield Office Properties Inc.).

 

The borrower sponsor is Brookfield Office Properties Inc. and the non-recourse carve-out guarantors are BOP NYC OP LLC and Swig Investment Company, LLC. The full recourse obligations of the non-recourse carveout guarantors for bankruptcy related events are capped at 15% of the outstanding principal balance of The Grace Building Whole Loan. BOP NYC OP LLC is a subsidiary of Brookfield Property Partners L.P., the public real estate vehicle of Brookfield Asset Management Inc. Brookfield Property Partners L.P. is a large global real estate company, with approximately $86 billion in total assets. Brookfield Property Partners L.P. owns and operates properties in the world’s major markets, with a global portfolio that includes office, retail, multifamily, logistics, hospitality, self-storage, triple-net lease, manufactured housing and student housing assets.

 

Swig Investment Company, LLC is a San Francisco-based private real estate investment company with an 80-year history of development, ownership and management of commercial real estate properties in major markets throughout the United States. The company’s diversified portfolio includes over 9 million square feet of office space in markets such as New York, San Francisco, and Southern California.

 

The Property. The Grace Building Property is a 1.56 million square foot, LEED Gold office tower located at Sixth Avenue and 42nd Street in Midtown Manhattan across from Bryant Park. The Grace Building Property was developed in 1974 by Swig Investment Company, LLC and designed by Skidmore, Owings & Merrill-partner Gordon Bunshaft. The Grace Building Property offers wide-open floor plates with walls of glass offering views of Bryant Park, the Hudson River and the city skyline. The Grace Building Property also includes an 188-space underground parking garage.

 

 

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.

 

52

 

 

Office - CBDLoan #2Cut-off Date Balance: $50,000,000
1114 Avenue of the AmericasThe Grace BuildingCut-off Date LTV: 41.1%
New York, NY 10036 U/W NCF DSCR: 4.25x
  U/W NOI Debt Yield: 11.8%

 

as of October 19, 2020, The Grace Building Property was 94.8% occupied by 35 tenants. Major tenants at The Grace Building Property include Bank of America, N.A., The Trade Desk and Israel Discount Bank. In addition to the office space, there is 30,877 square feet (2.0% of net rentable area) of retail space, which is 95.0% occupied by two fine dining restaurants, STK and Gabriel Kruether, and two quick service restaurants, Sweetgreen and Joe & The Juice.

 

The Grace Building Property has maintained high occupancy levels with a 20-year physical occupancy average of approximately 94%. The Grace Building Property experienced a major tenant turnover from 2016-2018, as four of the five largest tenants, including HBO (Time Warner Inc.) and Cooley LLP (a large law firm), were replaced by other tenants on long-term leases. As a result of such replacement leases, The Grace Building Property has been able to stabilize at approximately 95% occupancy, in-line with its historical average. Over 950,000 square feet of new and renewed leases have been signed at The Grace Building Property since 2016. As a result, less than 16.0% of tenants by net rentable area will have leases that expire in the next five years. Recent leasing activity includes 58,978 square feet of additional space leased to The Trade Desk, 127,425 square feet of expansion space leased to Bank of America, N.A., and 41,957 square feet of renewal and expansion space leased to iStar Financial.

 

COVID-19 Update. The Grace Building Whole Loan is current through the June 2021 payment date and is not subject to any forbearance, modification or debt service relief request. The Grace Building Property is open and operating, with 95.5% of tenants by occupied net rentable area and 94.0% of tenants by underwritten base rent having paid their June 2021 rent payments. The four retail tenants (1.8% of net rentable area, 2.5% of underwritten rent) have not made full rent payments for the last three months or more. The borrower sponsor is in the process of negotiating rent deferrals with such retail tenants, with full rental payments anticipated to commence in late 2021 or early 2022. The parking tenant has not paid the required monthly rental payments since March 2020 and an event of default is continuing under its lease. The borrower sponsor is in the process of replacing the current parking operator and intends to employ a new parking operator under a management agreement. The Grace Building Borrower deposited $1,608,940 with the lender at loan origination for anticipated parking rent shortfalls. We cannot assure you the borrower sponsor will employ a new parking operator as anticipated or at all.

 

Major Tenants.

 

The largest tenant at The Grace Building Property, Bank of America, N.A. (“BANA”), which is also one of the originating lenders, leases 155,270 square feet (10.0% of net rentable area, 9.0% of underwritten rent) of combined space on the 5th, 6th and 7th floors of The Grace Building Property, together with the building pavilion premises located on and beneath the plaza area of the 43rd Street side of the building through May 31, 2042. BANA is a multinational investment bank and financial services holding company headquartered in Charlotte, North Carolina, with central hubs in New York City, London, Hong Kong, Dallas and Toronto. BANA has expanded its footprint around Bryant Park with its New York headquarters at One Bryant Park and a recent expansion into 1100 Avenue of the Americas. BANA has the option to renew its lease for up to four renewal terms for a maximum of 20 years, provided that BANA must occupy 100,000 square feet in each of (i) the 5th, 6th and 7th floors and (ii) the portion of the total premises (i.e., such floors plus the pavilion space) leased by it as to which BANA is exercising the renewal option. BANA is only permitted to exercise a renewal with respect to the pavilion premises if at least six full floors of office space under its lease at 1100 Avenue of the Americas is also simultaneously renewed. BANA’s lease does not provide any termination options.

 

BANA’s annual base rent for the 5th, 6th and 7th floors is currently $79.00 per square foot and its annual base rent for the pavilion premises is currently $92.50 per square foot. BANA paid all charged rent for the May 2021 period. All free rent associated with the BANA lease, in the amount of $1,884,169, was fully reserved at loan origination. BANA is entitled to $8,840,109 for tenant improvements from the landlord, which amount was fully reserved at loan origination.

 

The second largest tenant at The Grace Building Property, The Trade Desk (“Trade Desk”), leases 154,558 square feet (9.9% of net rentable area, 14.4% of underwritten rent). Trade Desk is a global technology company that markets a software platform used by digital advertising buyers to purchase data-driven digital advertising campaigns across various advertising formats and devices. Trade Desk currently has over 1,300 employees and a reported market capitalization of approximately $26.48 billion. Trade Desk currently leases a total of 154,558 square feet on the 26th, 27th, 46th, 47th and 48th floors through August 31, 2030. The commencement date (the “Additional Premises Commencement Date”) with respect to the 26th and 27th floors (“Additional Premises”) will occur upon the earlier of (i) substantial completion of the work to be performed by the landlord and (ii) the date Trade Desk first takes possession of the space. Trade Desk has one, five-year renewal option so long as Trade Desk is not in default or in bankruptcy and Trade Desk and its affiliates physically occupy at least 79% of the space.

 

Trade Desk’s annual base rent for the 46th, 47th and 48th floors is $139.00 per square foot from August 10, 2020 through August 31, 2025, and then $148.00 per square foot from September 1, 2025 through August 31, 2030. Trade Desk’s annual base rent for the 26th and 27th floors is $118.00 per square foot initially and then $128.00 per square foot after the fifth anniversary of the Additional Premises Commencement Date through August 31, 2030. Trade Desk is currently in a free rent period through September 30, 2021. All free rent, in the amount of $5,799,503, was fully reserved at loan origination. Trade Desk is entitled to $7,770,283 for tenant improvements and leasing costs from the landlord, which amount was fully reserved at loan origination. We cannot assure you that Trade Desk will take possession of the Additional Premises or begin paying rent as expected or at all.

 

The third largest tenant at The Grace Building Property, Israel Discount Bank (“IDB”), leases 142,533 square feet (9.2% of net rentable area, 5.5% of underwritten base rent). IDB is an American multinational private bank, commercial bank and financial services company headquartered in New York City with locations in the United States, Latin America and Israel. Chartered by the State of New York and a member of the Federal Deposit Insurance Corporation, IDB reported $9.23 billion in total assets in 2018. IDB currently leases 142,533 square feet of combined space on the ground, 2nd, 8th, 9th and 10th floors through December 31, 2040. IDB has two, five-year

 

 

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.

 

53

 

 

Office - CBDLoan #2Cut-off Date Balance: $50,000,000
1114 Avenue of the AmericasThe Grace BuildingCut-off Date LTV: 41.1%
New York, NY 10036 U/W NCF DSCR: 4.25x
  U/W NOI Debt Yield: 11.8%

 

renewal options, with 21 months’ prior written notice, provided that IDB has not subleased more than 20% of its leased premises, and IDB is leasing at least two full floors on the date it exercises the renewal option.

 

IDB’s annual base rent for the ground floor is $317.08 per square foot, which steps to $352.08 per square foot, $392.08 per square foot and $442.08 per square foot every five years. IDB’s annual base rent for the 2nd, 8th, 9th and 10th floors is $51.08 per square foot, which steps to $58.08 per square foot, $65.08 per square foot and $72.08 per square foot every five years. The Grace Building Borrower has completed its work required under the lease and delivered the space to IDB and IDB took possession of the space and commenced paying rent in January 2021 and is expected to commence paying operating expenses and real estate taxes in January 2022. All free rent, in the amount of $5,546,495, was fully reserved at loan origination. IDB is entitled to $15,906,051 for tenant improvements and leasing commissions, which amount was fully reserved at loan origination. We cannot assure you that IDB will begin paying operating expenses or real estate taxes as expected or at all.

 

The fourth largest tenant at The Grace Building Property, Bain & Company, Inc. (“Bain”), leases 121,262 square foot (7.8% of net rentable area, 9.2% of underwritten base rent). Bain is an American global management consulting firm headquartered in Boston, Massachusetts. Bain provides advisory services to many large businesses, non-profit organizations and governments. Bain has 59 offices in 37 countries and more than 12,000 employees. Bain leases a portion of the 41st floor and the entire 42nd, 43rd and 44th floors through February 28, 2030. Bain has two, five-year renewal options, with 18 months’ prior written notice; provided that Bain is not in default and is physically occupying at least the lesser of (x) two full floors of the building and (y) 66.66% of its space. The lease does not contain any termination options.

 

Bain’s annual base rent for the 41st floor is currently $133.00 per square foot, increasing to $143.00 per square foot on January 1, 2026. The annual base rent for the 42nd through 44th floors is currently $99.50 per square foot, increasing to $106.00 per square foot on March 1, 2025. Bain is entitled to $2,439,030 for tenant improvements related to its 41st floor expansion, which amount was fully reserved at loan origination.

 

The following table presents certain information relating to the tenancy at The Grace Building Property:

 

Major Tenants(1)

 

Tenant Name Credit Rating
(Fitch/
Moody’s/
S&P) (3)
 Tenant
NRSF
 % of
NRSF
 

Annual

U/W Base
Rent PSF

 Annual
U/W Base Rent
 % of Total
Annual
U/W Base
Rent
 Lease
Expiration
 Extension
Options
 Term.
Option
(Y/N)
Bank of America, N.A. (2) A+/A2/A- 155,270 10.0% $81.42  $12,642,238 9.0% 5/31/2042 Y N
The Trade Desk(2) NR/NR/NR 154,558 9.9  130.99  20,245,024 14.4  8/31/2030 Y Y(4)
Israel Discount Bank NR/NR / BBB+ 142,533 9.2  54.21  7,727,200 5.5  12/31/2040 Y Y(5)
Bain & Company, Inc. (2) NR/NR/NR 121,262 7.8  106.59  12,925,648 9.2  2/28/2030 Y N
Insight Venture Management LLC(2) NR/NR/NR 93,998 6.0  102.69  9,652,225 6.9  2/28/2030 N N
Subtotal / Wtd. Average   667,621 42.9% $94.65  $63,192,334 45.0%      
Other Office and Storage   780,613 50.1  94.55  73,804,124 52.5       
Retail   28,103 1.8  122.91  3,454,052 2.5       
Occupied Collateral Total   1,476,337 94.8% $95.13  $140,450,510 100.0%      
Vacant Space   80,635 5.2               
Collateral Total   1,556,972 100.0%              
                      
(1)Information is based on the underwritten rent roll.

(2)As of the loan origination date, Bank of America, N.A., The Trade Desk, Bain & Company, Inc. and Insight Venture Management LLC were entitled to a total of approximately $12,022,739 of free rent which was fully reserved by the lender.
(3)Certain ratings are those of the parent entity whether or not the parent entity guarantees the lease.

(4)Trade Desk currently has the right to terminate its lease solely as to the 26th and 27th floors related to the occurrence of the lease commencement date. Additionally, provided Trade Desk is not in bankruptcy and no default is occurring under its lease, Trade Desk has a one-time right to terminate the lease with respect to one or both of the 26th and 27th floors, effective as of the last day of the month in which the seventh anniversary of the Additional Premises Commencement Date occurs. If Trade Desk has elected to terminate its lease with respect to both the 26th and 27th floors, Trade Desk will owe $6,700,000 as a termination payment. If Trade Desk has elected to terminate its lease with respect to either the 26th or 27th floor, Trade Desk will owe $3,350,000 as a termination payment. Notwithstanding the foregoing, no termination will be permitted if Trade Desk has exercised its right of first offer to lease certain additional space pursuant to its lease within the 24-month period immediately preceding the date on which Trade Desk sends a notice to effectuate such termination. We cannot assure you that the Trade Desk lease for the Trade Desk Additional Premises will commence as expected or at all.

(5)Subject to certain conditions set forth in the lease, IDB has (i) a one-time right to terminate its entire leased space, effective as of December 31, 2035, with 21 months’ prior written notice, and (ii) the right to terminate the lease with respect to the ground floor only, effective (at IDB’s option) on either the fifth anniversary or the tenth anniversary of the rent commencement date, with 15 months’ prior written notice.

 

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.

 

54

 

 

Office - CBDLoan #2Cut-off Date Balance: $50,000,000
1114 Avenue of the AmericasThe Grace BuildingCut-off Date LTV: 41.1%
New York, NY 10036 U/W NCF DSCR: 4.25x
  U/W NOI Debt Yield: 11.8%

 

The following table presents certain information relating to the lease rollover schedule at The Grace Building Property:

 

Lease Expiration Schedule(1)(2)

 

Year Ending
December 31,
 No.
of Leases
Expiring
 Expiring
NRSF
 % of
Total
NRSF
 Cumulative
Expiring
NRSF
 Cumulative
% of Total
NRSF
 Annual
 U/W
Base Rent
 % of Total
Annual U/W
Base Rent
 Annual U/W
Base Rent PSF
MTM 0 0 0.0% 0 0.0% $0 0.0% $0.00
2021 1 5,497 0.4% 5,497 0.4% $412,275 0.3% $75.00
2022 1 600 0.0% 6,097 0.4% $0 0.0% $0.00
2023 5 55,694 3.6% 61,791 4.0% $3,991,172 2.8% $71.66
2024 10 143,459 9.2% 205,250 13.2% $14,251,502 10.1% $99.34
2025 3 31,907 2.0% 237,157 15.2% $3,765,480 2.7% $118.01
2026 9 121,137 7.8% 358,294 23.0% $12,381,404 8.8% $102.21
2027 3 47,753 3.1% 406,047 26.1% $4,090,693 2.9% $85.66
2028 4 97,651 6.3% 503,698 32.4% $7,914,676 5.6% $81.05
2029 3 21,740 1.4% 525,438 33.7% $2,201,776 1.6% $101.28
2030 24 459,310 29.5% 984,748 63.2% $51,997,764 37.0% $113.21
2031 4 10,727 0.7% 995,475 63.9% $1,032,656 0.7% $96.27
Beyond 21 480,862 30.9% 1,476,337 94.8% $38,411,114 27.3% $79.88
Vacant 0 80,635 5.2% 1,556,972 100.0% $0 0.0% $0.00
Total/Weighted Average 88 1,556,972 100.0%     $140,450,510 100.0% $95.13(3)
(1)Information based on the underwritten rent roll.
(2)Certain tenants have more than one lease. In addition, certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date.

(3)Weighted Average Annual U/W Rent Base PSF excludes Vacant Space.

 

The following table presents historical occupancy percentages at The Grace Building:

 

Historical Occupancy

 

2015(1) 2016(1) 2017(1) 2018(1) 2019(1) Current(2)
93.1% 87.0% 94.7% 97.6% 91.0% 94.8%
(1)Historical Occupancy is provided by the borrower sponsor. Occupancies are as of December 31 of each respective year.
(2)Based on the underwritten rent roll dated October 19, 2020.

 

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.

 

55

 

 

Office - CBDLoan #2Cut-off Date Balance: $50,000,000
1114 Avenue of the AmericasThe Grace BuildingCut-off Date LTV: 41.1%
New York, NY 10036 U/W NCF DSCR: 4.25x
  U/W NOI Debt Yield: 11.8%

 

Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the underwritten net cash flow at The Grace Building Property:

 

Cash Flow Analysis(1)

 

  2017 2018 2019 9/30/2020
TTM(1)
 U/W(2) %(2) U/W $
PSF
 
Base Rental Income(3) $99,833,553 $107,014,493 $91,119,452 $87,976,996 $140,450,510 86.6% $90.21 
Expense Reimbursements 10,212,232 12,529,407 8,566,979 6,267,900 12,766,325 7.9 8.20 
Straight-Lined Rent(4) 0 0 0 0 1,439,207 0.9 0.92 
Vacant Income(5) 0 0 0 0 7,464,675 4.6 4.79 
Net Rental Income $110,045,785 $119,543,900 $99,686,431 $94,244,896 $162,120,717 100.0% $104.13 
Other Income(6) 3,209,878 3,195,652 3,230,812 2,759,133 2,956,947 1.8 1.90 
(Vacancy & Credit Loss)(5) 0 0 0 0 (7,464,675) (4.6) (4.79) 
Effective Gross Income $113,255,664 $122,739,552 $102,917,243 $97,004,029 $157,612,989 97.2% $101.23 
                
Taxes 25,496,191 27,159,739 29,139,042 30,649,698 31,927,579 20.3 20.51 
Insurance 1,019,973 1,226,645 1,134,711 1,220,279 1,455,626 0.9 0.93 
Other Operating Expenses 19,579,826 21,146,504 20,105,297 18,861,512 19,936,067 12.6 12.80 
Total Operating Expenses $46,095,990 $49,532,888 $50,379,050 $50,731,490 $53,319,272 33.8% $34.25 
                
Net Operating Income $67,159,674 $73,206,665 $52,538,193 $46,272,539 $104,293,717 66.2% $66.98 
TI/LC 0 0 0 0 1,556,972 1.0 1.00 
Capital Expenditures 0 0 0 0 389,243 0.2 0.25 
Net Cash Flow $67,159,674 $73,206,665 $52,538,193 $46,272,539 $102,347,502 64.9% $65.73 
                
NOI DSCR 2.79x 3.04x 2.18x 1.92x 4.33x     
NCF DSCR 2.79x 3.04x 2.18x 1.92x 4.25x     
NOI Debt Yield 7.6% 8.3% 5.9% 5.2% 11.8%     
NCF Debt Yield 7.6% 8.3% 5.9% 5.2% 11.6%     
(1)The volatility in cash flow at The Grace Building Property is a result of the replacement of some larger legacy tenants (including 4 of the 5 largest tenants) between 2016 and 2018 and the signing of new and renewal leases with respect to 950,000 square feet of space. The cash flow declines reflected in 2019 and in 9/30/2020 TTM and the projected increase in UW cash flows are the result of this rollover and the rent abatements associated with the new leases. All outstanding landlord obligations ($56,172,399) and rent abatements ($25,964,570) were reserved at loan origination.

(2)% column represents percent of Net Rental Income for all revenue lines and represents percent of Effective Gross Income for the remainder of fields.
(3)U/W Base Rental Income includes contractual rent steps of $4,566,719 underwritten for various tenants through March 1, 2022.
(4)Represents the straight line credit for investment grade tenants and tenants identified by a legal industry publication as among the 100 largest law firms through the lesser of the lease or loan term.
(5)U/W Vacancy represents an underwritten economic vacancy of 4.6%. The Grace Building Property is 94.8% occupied as of October 19, 2020.
(6)U/W Other Income consists of directly billed utilities and $1,608,941 of parking income. 1114 Sixth Parking LLC is the current tenant under a parking garage lease. The tenant has not paid the required monthly rental payments since March 2020 and an event of default is continuing under its lease. The Grace Building Borrower is actively pursuing the termination of the lease and a replacement arrangement with a new parking manager. At origination, The Grace Building Borrower deposited $1,608,940 with the lender for anticipated parking rent shortfalls, through October 2021.

 

Appraisal. The appraiser concluded to an “as-is” appraised value of $2,150,000,000 for The Grace Building Property as of September 8, 2020.

 

Environmental Matters. According to a Phase I environmental report dated September 22, 2020, there are no recognized environmental conditions or recommendations for further action at The Grace Building Property.

 

Market Overview and Competition. The Grace Building Property is located on the north side of Bryant Park at the corner of 42nd Street and 6th Avenue in the Sixth Avenue/Rockefeller Center submarket of the Midtown Manhattan office market. The Grace Building Property offers commuters access to multiple major mass transit stations in Manhattan, connecting to points across the tristate area. The 1-2-3, N-R-Q-W, 7 and B-D-F-M subway lines all stop within a block of The Grace Building Property, providing access to commuters coming from Penn Station, the Upper West Side, and Queens. The S subway line provides a quick cross-town connection to Grand Central Station and the 4, 5, 6 subway line. Additionally, The Grace Building Property is three blocks from the Port Authority Bus terminal at 8th Avenue and 42nd Street.

 

The Sixth Avenue/Rockefeller Center area has recently experienced the signing of sizable new leases. According to a third-party market research report, in the second quarter of 2020, a large technology company signed a 232,000 square foot lease at 151 West 42nd Street that was the largest new lease signed in the Sixth Avenue / Rockefeller Center area in the quarter. Other recent lease executions include Colliers relocating to The Grace Building Property for approximately 59,000 square feet and TripleMint leasing 31,000 square

 

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.

 

56

 

 

Office - CBDLoan #2Cut-off Date Balance: $50,000,000
1114 Avenue of the AmericasThe Grace BuildingCut-off Date LTV: 41.1%
New York, NY 10036 U/W NCF DSCR: 4.25x
  U/W NOI Debt Yield: 11.8%

 

feet at 1500 Broadway. Following a wave of move-outs earlier in the annual cycle, relocations into the Sixth Avenue/Rockefeller Center submarket have pushed vacancies downward in recent years to around 4.4% at the end of the second quarter of 2020.

 

According to the appraisal, as of the second quarter of 2020, the Sixth Avenue/Rockefeller Center Class A office submarket had a vacancy rate of 4.4% and market rents of $87.02 per square foot. The average in-place office rent at The Grace Building Property is currently approximately $95 per square foot.

 

The following table presents certain information relating to the appraiser’s market rent conclusions for The Grace Building Property:

 

Market Rent Summary – Office (1)

 

 

Office

(Floors 2-12)

Office

(Floors 14-19)

Office

(Floors 20-25)

Office

(Floors 26-37)

Office

(Floors 38-41)

Office

(Floors 42-48)

Market Rent (PSF)$85.00$90.00$100.00$115.00$125.00$140.00
Lease Term (Years)151515151515
Lease Type (Reimbursements)Modified GrossModified GrossModified GrossModified GrossModified GrossModified Gross
Rent Increase Projection$10.00 Per Square Foot Every 5 Years
(1)Information obtained from the appraisal.

 

The table below presents certain information relating to comparable sales pertaining to The Grace Building Property identified by the appraiser:

 

Comparable Sales(1)

 

Property NameLocationRentable
Area (SF)
Year Built
(Renovated)
Sale DateActual Sale
Price
Sale Price
(PSF)
One Madison AvenueNew York, NY1,392,5651932 (2023)Contract$2,300,000,000$1,652
1633 BroadwayNew York, NY2,561,5121972 (2013)May 2020$2,400,000,000$937
330 Madison AvenueNew York, NY854,6641963Feb 2020$900,000,000$1,053
55 Hudson YardsNew York, NY1,431,1552019Jan 2020$2,500,000,000$1,747
150 East 42nd StreetNew York, NY1,698,6031955 (2010)Oct 2019$1,300,000,000$765
30 Hudson YardsNew York, NY1,463,2342019April 2019$2,155,000,000$1,473
640 Fifth AvenueNew York, NY315,8861948 (2014)April 2019$975,000,000$3,087
3 Columbus CircleNew York, NY753,4051927 (2011)Nov 2018$1,035,000,000$1,374
(1)Information obtained from the appraisal.

 

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.

 

57

 

 

Office - CBDLoan #2Cut-off Date Balance: $50,000,000
1114 Avenue of the AmericasThe Grace BuildingCut-off Date LTV: 41.1%
New York, NY 10036 U/W NCF DSCR: 4.25x
  U/W NOI Debt Yield: 11.8%

 

The following tables present certain information relating to comparable office buildings for The Grace Building Property:

 

Comparable Office Properties(1)

 

Property Name/LocationYear Built/
Renovated
NRA (SF)No. of Stories

Office Rents

Asking & Taking

Occupancy

One Bryant Park

New York, NY

20092,354,00054--100.0%

Three Bryant Park

New York, NY

1972 / 20081,484,32542$95 - $11596.8%

Seven Bryant Park

New York, NY

2015473,67228$120 - $15097.9%

1100 Avenue of the Americas

New York, NY

1906 / 2021373,01615--90.4%

660 Fifth Avenue

New York, NY

1958 / 20211,436,83940$90 - $15066.0%

1 Vanderbilt

New York, NY

20201,732,95567$125 - $20065.0%

1 Manhattan West

New York, NY

20192,100,00067$115 - $13586.0%

2 Manhattan West

New York, NY

20221,900,00056$90 - $15025.3%

50 Hudson Yards

New York, NY

20222,900,00062$110 - $20030.0%

55 Hudson Yards

New York, NY

20191,434,03851$105 - $13598.0%

4 Times Square

New York, NY

1999 / 20181,800,00048$80 - $10094.1%
(1)Information obtained from the appraisal.

 

Property Management. The Grace Building Property is currently managed by TRZ Holdings IV LLC (an affiliate of the borrower sponsors) (“TRZ”), pursuant to a management agreement and is sub-managed by Brookfield Properties (USA II) LLC (an affiliate of a borrower sponsor pursuant to a sub-management agreement). Under the Grace Building Whole Loan documents, the Grace Building Property is required to be managed by TRZ and submanaged by Brookfield Properties (USA II) LLC, respectively, or any qualified manager as defined in The Grace Building Whole Loan documents. The lender has the right to replace, or require The Grace Building Borrower to replace, each of the property manager and the property sub-manager with a property manager or property sub-manager, as applicable, selected by The Grace Building Borrower (or selected by the lender in the event of an event of default under The Grace Building Whole Loan documents) (i) during the continuance of an event of default under The Grace Building Whole Loan documents, (ii) during the continuance of a material default by the property manager under the management agreement or the property sub-manager under the sub-management agreement (after the expiration of any applicable notice and/or cure periods), or (iii) if the property manager or property sub-manager becomes bankrupt or insolvent.

 

Escrows and Reserves. At loan origination, The Grace Building Borrower deposited into escrow $56,172,399 for outstanding landlord tenant improvement and leasing commission obligations due to various tenants, $25,964,570 for free rent owed to various tenants through June 2022 to be applied on each monthly payment date to simulate the payment of tenant rent, $5,970,240 for certain construction and improvement work related to the lobby and elevator cabs and systems and $1,608,940 for anticipated parking rent shortfalls from the origination date through November 2021 (1/12th of which reserve will be deposited into the lockbox account on each monthly payment date for such period).

 

Real Estate Taxes – During a Trigger Period (as defined below), The Grace Building Borrower is required to deposit on a monthly basis 1/12th of the annual estimated real estate taxes.

 

Insurance – During a Trigger Period, The Grace Building Borrower is required to deposit on a monthly basis 1/12th of the annual estimated insurance premiums (unless The Grace Building Property is covered by a blanket policy).

 

Replacement Reserves – During a Trigger Period, The Grace Building Borrower is required to deposit on a monthly basis $0.20 per square feet per annum (which was $25,950 as of the origination date) for capital expenditures.

 

TI/LC Reserves –During a Trigger Period, The Grace Building Borrower is required to deposit on a monthly basis $1.50 per square feet per annum (which was $194,622 as of the origination date) for tenant improvements and leasing commissions.

 

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.

 

58

 

 

Office - CBDLoan #2Cut-off Date Balance: $50,000,000
1114 Avenue of the AmericasThe Grace BuildingCut-off Date LTV: 41.1%
New York, NY 10036 U/W NCF DSCR: 4.25x
  U/W NOI Debt Yield: 11.8%

 

Lockbox / Cash Management. The Grace Building Whole Loan is structured with a hard lockbox and springing cash management. Revenues from The Grace Building Property are required to be deposited into the lockbox account directly by the tenants and any funds received by The Grace Building Borrower and property manager must be deposited within five business days of receipt. If no Trigger Period exists, funds in the lockbox account will be disbursed to The Grace Building Borrower. During a Trigger Period, funds in the lockbox account are required to be swept on each business day to the lender-controlled cash management account and disbursed according to The Grace Building Whole Loan documents, with excess cash held by the lender for so long as such Trigger Period continues, other than for disbursements to The Grace Building Borrower for (unless already paid) debt service due under The Grace Building Whole Loan or any mezzanine loan, shortfalls in the required reserve accounts, deposit of cash in an amount to satisfy the debt yield test to cure a low cash flow period, emergency and, life safety expenses, approved operating expenses, disbursements to The Grace Building Borrower to be distributed to its equity holders in an amount sufficient to satisfy the distribution requirements applicable to REITs, and other permitted uses under The Grace Building Whole Loan documents.

 

A “Trigger Period” means the period (i) beginning upon the occurrence of an event of default under The Grace Building Whole Loan or, if a mezzanine loan is then outstanding under such mezzanine loan, and ending when the event of default has been cured or waived; or (ii) beginning when the debt yield (including any mezzanine loan) (tested each fiscal quarter) is less than 6.00% for any two consecutive fiscal quarters, and ending when (x) the debt yield (including any mezzanine loan) (tested each fiscal quarter) is at least 6.00% for any two consecutive fiscal quarters or (y) The Grace Building Borrower has delivered cash or a letter of credit in an amount which, when applied to the outstanding principal balance of The Grace Building Whole Loan (plus any mezzanine loan) would be sufficient to meet the debt yield requirement of 6.00%.

 

Current Mezzanine or Subordinate Indebtedness. The Grace Building Property also secures The Grace Building Subordinate Companion Loan, which has an aggregate Cut-off Date principal balance of $367,000,000. The Grace Building Subordinate Companion Loan accrues interest at an interest rate of 2.6921% per annum. The Grace Building Senior Loan is senior in right of payment to The Grace Building Subordinate Companion Loan. At or around loan origination, the holders of The Grace Building Senior Loan and The Grace Building Subordinate Companion Loan entered into a co-lender agreement that sets forth the allocation of collections on The Grace Building Whole Loan. See “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced AB Whole Loans—The Grace Building Whole Loan” in the Preliminary Prospectus.

 

Permitted Future Mezzanine or Secured Subordinate Indebtedness. An affiliate of the borrower is permitted to incur future mezzanine debt (secured by a pledge of direct equity interests in the borrower), provided that among other conditions: (i) no event of default is continuing; (ii) the principal amount of the mezzanine loan may not exceed an amount which, when combined with the Grace Building Whole Loan results in (a) a loan-to-value ratio greater than 58.14% or (b) a debt yield less than 8.35%; (iii) the mezzanine loan is co-terminous with the Grace Building Whole Loan or is freely prepayable after the maturity date of the Grace Building Whole Loan; (iv) the mezzanine loan is interest-only; (v) an intercreditor agreement is executed that is acceptable to the lender and the rating agencies; and (vi) a rating agency confirmation is delivered by each rating agency rating securities backed by the Grace Building Whole Loan.

 

Partial Release. Not permitted.

 

Real Estate Substitution. Not permitted.

 

Right of First Offer/Right of First Refusal. None.

 

Ground Lease. None.

 

Terrorism Insurance. The Grace Building Borrower is required to obtain and maintain “all risk” property insurance that covers perils of terrorism and acts of terrorism in an amount equal to the full replacement cost of The Grace Building Property and business interruption insurance for 36 months (24 months for terrorism) with a 12-month extended period of indemnity; provided that if the Terrorism Risk Insurance Program Reauthorization Act is no longer in effect, The Grace Building Borrower will not be obligated to pay annual insurance premiums for terrorism coverage in excess of two times the insurance premiums that would be payable under policies then obtained for all risk and business interruption insurance (excluding the terrorism and earthquake components of such property and business income insurance). See “Risk Factors—Risks Relating to the Mortgage Loans—Terrorism Insurance May Not Be Available for All Mortgaged Properties” 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.

 

59

 

 

Retail - AnchoredLoan #3Cut-off Date Balance: $48,000,000
23705 Malibu RoadMalibu Colony PlazaCut-off Date LTV: 50.5%
Malibu, CA 90265 U/W NCF DSCR: 2.10x
  U/W NOI Debt Yield: 8.1%

 

img 

 

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.

 

60

 

 

Retail - AnchoredLoan #3Cut-off Date Balance: $48,000,000
23705 Malibu RoadMalibu Colony PlazaCut-off Date LTV: 50.5%
Malibu, CA 90265 U/W NCF DSCR: 2.10x
  U/W NOI Debt Yield: 8.1%

 

img 


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.

 

61

 

 

Retail - AnchoredLoan #3Cut-off Date Balance: $48,000,000
23705 Malibu RoadMalibu Colony PlazaCut-off Date LTV: 50.5%
Malibu, CA 90265 U/W NCF DSCR: 2.10x
  U/W NOI Debt Yield: 8.1%

 

img 

 

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.

 

62

 

 

No. 3 – Malibu Colony Plaza
 
Mortgage Loan Information Mortgaged Property Information
Mortgage Loan Seller:LMF Commercial, LLC Single Asset/Portfolio:Single Asset
Credit Assessment (DBRSM/Fitch/Moody’s):NR/NR/NR Property Type – Subtype:Retail – Anchored
Original Principal Balance:$48,000,000 Location:Malibu, CA
Cut-off Date Balance:$48,000,000 Size:114,370 SF
% of Initial Pool Balance:6.4% Cut-off Date Balance Per SF:$419.69
Loan Purpose:Refinance Maturity Date Balance Per SF:$419.69
Borrower Sponsors:KW Partnership, L.P. and KW Two Partnership, L.P. Year Built/Renovated:1989/NAP
Guarantors:KW Partnership, L.P. and KW Two Partnership, L.P. Title Vesting:Fee
Interest Rate:3.7500% Property Manager:TKG Management, Inc. (borrower-related)
Note Date:May 6, 2021 Current Occupancy (As of)(2):89.5% (4/8/2021)
Seasoning:2 months YE 2020 Occupancy:90.0%
Maturity Date:May 6, 2031 YE 2019 Occupancy:91.0%
IO Period:120 months YE 2018 Occupancy:86.0%
Loan Term (Original):120 months YE 2017 Occupancy:85.0%
Amortization Term (Original):NAP As-Is Appraised Value(3):$95,000,000
Loan Amortization Type:Interest Only As-Is Appraised Value Per SF(3):$830.64
Call Protection:L(24),YM1(92),O(4) As-Is Appraisal Valuation Date:April 18, 2021
Lockbox Type:Springing Underwriting and Financial Information(3)
Additional Debt:None TTM NOI (3/31/2021)(4):$2,841,060
Additional Debt Type (Balance):NAP YE 2020 NOI:$3,263,415
   YE 2019 NOI:$4,297,116
   U/W Revenues:$7,154,679
   U/W Expenses:$3,246,859
Escrows and Reserves(1) U/W NOI(4):$3,907,820
 InitialMonthlyCap U/W NCF:$3,833,479
Taxes$0SpringingNAP U/W DSCR based on NOI/NCF:2.14x / 2.10x
Insurance$0SpringingNAP U/W Debt Yield based on NOI/NCF:8.1% / 8.0%
Replacement Reserve$0SpringingNAP U/W Debt Yield at Maturity based on NOI/NCF:8.1% / 8.0%
TI/LC Reserve$0Springing$285,925 Cut-off Date LTV Ratio:50.5%
     LTV Ratio at Maturity:50.5%
       
        
Sources and Uses
Sources    Uses   
Original loan amount$48,000,000 100.0% Loan payoff$41,221,217    85.9%
     Closing costs426,299 0.9  
     Return of equity6,352,483 13.2 
Total Sources$48,000,000 100.0% Total Uses$48,000,000 100.0%
(1)See “Escrows” section for a full description of Escrows and Reserves.

(2)Current Occupancy includes Zinque (the 3rd largest tenant), which represents 6,387 square feet (5.6% of net rentable area and 7.6% of underwritten base rent). It is anticipated that Zinque will take occupancy and commence paying rent at the Malibu Colony Plaza Property (as defined below) in April 2022. The borrower sponsors have signed a 10-year Master Lease (as defined below) on the space until Zinque is in occupancy and paying rent. Zinque is working to obtain the proper zoning approval from the City of Malibu. U/W vacancy adjustment includes Zinque rent and recoveries.

(3)While the Malibu Colony Plaza Mortgage Loan (as defined below) 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 Malibu Colony Plaza Mortgage Loan more severely than assumed in the underwriting of Malibu Colony Plaza Mortgage 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.

(4)The U/W NOI increased compared to TTM NOI due to the fact that because of the COVID-19 pandemic several tenants (Coogie’s Beach Café, Becker Surfboards, Bui Sushi, Ogden Dry Cleaners, Pinnacle Estate Properties, Vitamin Barn, The Nail Spa, and Malibu Oasis Salon (representing approximately 14.5% of the net rentable area and approximately 36.8% of the underwritten base rent)) received rent abatements and/or deferred rent payments, affecting actual rent collections. The borrower sponsors signed Master Leases on all of the above tenants’ spaces for a term of 10 years at rents equal to the rents payable under the applicable leases with a deduction for the amount of rent actually paid by the applicable underlying tenant.

 

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.

 

63

 

 

Retail - AnchoredLoan #3Cut-off Date Balance: $48,000,000
23705 Malibu RoadMalibu Colony PlazaCut-off Date LTV: 50.5%
Malibu, CA 90265 U/W NCF DSCR: 2.10x
  U/W NOI Debt Yield: 8.1%

 

The Mortgage Loan. The mortgage loan (the “Malibu Colony Plaza Mortgage Loan”) is evidenced by a single promissory note secured by a first mortgage encumbering the fee interest in a 114,370 square-foot anchored retail property located in Malibu, California (the “Malibu Colony Plaza Property”).

 

The Borrower and Borrower Sponsors. The borrower is KW Malibu Colony, L.L.C. (the “Malibu Colony Plaza Borrower”), a Missouri limited liability company and single purpose entity with two independent directors. Legal counsel to the Malibu Colony Plaza Borrower delivered a non-consolidation opinion in connection with the origination of the Malibu Colony Plaza Mortgage Loan. The nonrecourse carve-out guarantors and borrower sponsors of the Malibu Colony Plaza Mortgage Loan are KW Partnership, L.P. and KW Two Partnership, L.P.

 

The borrower sponsors are owned by Ann W. Kroenke, Audrey J. Walton and Audrey J. Walton Revocable Trust. Ann W. Kroenke is an heir to the Walmart fortune; Audrey J. Walton is the ex-wife of James L. “Bud” Walton, Sam Walton’s younger brother and a co-founder of Walmart. Ann W. Kroenke is the wife of E. Stanley Kroenke, a repeat borrower sponsor. E. Stanley Kroenke is chairman, co-founder, and owner of THF Realty, a real estate development firm.

 

The Property. The Malibu Colony Plaza Property is a retail anchored shopping center, containing 114,370 square feet of net rentable area located in Malibu, California. Built in 1989, the Malibu Colony Plaza Property consists of two, one-story retail buildings located on a 13.9 acre parcel. The Malibu Colony Plaza Property is anchored by Ralphs Fresh Fare and junior anchored by CVS. The Malibu Colony Plaza Property contains 601 surface parking spaces, resulting in a parking ratio of 5.25 spaces per 1,000 square feet of net rentable area. As of April 8, 2021, the Malibu Colony Plaza Property was 89.5% occupied by 22 national, regional and local tenants. Verizon Wireless is dark at the Malibu Colony Plaza Property and still paying rent; however, the tenant has been underwritten as vacant.

 

Major Tenants.

 

Largest Tenant: Ralphs Fresh Fare (36,200 square feet, 31.7% of net rentable area; 5.8% of underwritten base rent; 8/30/2023 lease expiration; Fitch/Moody’s/S&P: NR/Baa1/BBB) – Ralphs Fresh Fare is part of Ralphs Grocery Company, which was founded in 1873. Ralphs Grocery Company division headquarters are located in Los Angeles, California. Ralphs Grocery Company operates 465 Ralph’s stores in the southern and northern regions of California and the Midwest. Ralphs Grocery Company is a subsidiary of The Kroger Co. (“Kroger”). As of January 30, 2021, Kroger operated, either directly or through its subsidiaries, 2,742 supermarkets under a variety of local banner names, of which 2,255 had pharmacies and 1,596 had fuel centers. Kroger also manufactures and processes some of the food for sale in its supermarkets. For fiscal year ended January 2021, Kroger reported net sales of approximately $132.5 billion, an increase of 8.4% from the previous year. Ralphs Fresh Fare has been a tenant at the Malibu Colony Plaza Property since 1984 and has no renewal options remaining.

 

2nd Largest Tenant: CVS (22,880 square feet, 20.0% of net rentable area; 3.0% of underwritten base rent; 1/31/2025 lease expiration; Fitch/Moody’s/S&P: NR/Baa2/BBB) – Founded in 1963, CVS is the largest pharmacy healthcare provider in the United States and is headquartered in Woonsocket, Rhode Island. CVS operations include pharmaceutical and health and wellness services, including retail, specialty, mail service, care clinics, and wellness centers. As of December 31, 2020, CVS operated approximately 9,900 retail locations, 1,100 walk-in medical clinics, of which 80 clinics operated within Target stores. CVS retail/long-term care segment focuses on prescription and over-the-counter drugs and personal care products. For the fiscal year ended December 2020, the CVS retail/long-term care segment reported revenue of approximately $91.2 billion, up 5.3% over the prior year’s total sales of approximately $86.6 billion. CVS has been a tenant at the Malibu Colony Plaza Property since 1985 and has one, 5-year renewal option remaining.

 

3rd Largest Tenant: Zinque (6,387 square feet; 5.6% of net rentable area; 7.6% of underwritten base rent; 3/31/2032 lease expiration) – Zinque is a restaurant featuring French-inspired dishes, small plates and a curated wine and beer selection. Zinque currently has six restaurants in southern California and one located in Scottsdale, Arizona. Zinque signed its lease on October 1, 2019, and it is anticipated that Zinque will take occupancy and commence paying rent at the Malibu Colony Plaza Property in April 2022. The borrower sponsors have signed a 10-year Master Lease on the space until Zinque is in occupancy and paying rent. Zinque is working to obtain the proper zoning approval from the City of Malibu. On June 7, 2021, Zinque obtained a conditional use permit, and the tenant is working to obtain the other necessary licenses, permits and government approvals. If Zinque cannot obtain a Type 47 liquor license, and all other necessary permits, licenses and other government approvals needed for the tenant’s work and to operate its business at the Malibu Colony Plaza Property by November 8, 2021, Zinque has the right to terminate its lease. The Zinque lease provides for one, 5-year renewal.

 

COVID-19 Update. As of June 24, 2021, the Malibu Colony Plaza Property is open and operating. Collection for June 2021 at the Malibu Colony Plaza Property was at 93.9% of total square feet and 97.5% of total UW base rent. Eight tenants totaling 16,630 square feet (14.5% of net rentable area and 36.8% of underwritten base rent) received rent deferral. The borrower sponsors of the Malibu Colony Plaza Mortgage Loan signed master leases for a term of 10-years for each of these eight spaces, agreeing to pay any shortfalls for rent not paid by any of these tenants for the term of the Malibu Colony Plaza Mortgage Loan. As of the date hereof, the Malibu Colony Plaza Mortgage Loan is not subject to any modification or forbearance agreement, and the Malibu Colony Plaza Borrower has not requested any modification or forbearance to the Malibu Colony Plaza Mortgage Loan terms.

 

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.

 

64

 

 

Retail - AnchoredLoan #3Cut-off Date Balance: $48,000,000
23705 Malibu RoadMalibu Colony PlazaCut-off Date LTV: 50.5%
Malibu, CA 90265 U/W NCF DSCR: 2.10x
  U/W NOI Debt Yield: 8.1%

 

The following table presents certain information relating to the tenancy at the Malibu Colony Plaza Property:

 

Major Tenants

 

Tenant NameCredit Rating (Fitch/Moody’s/
S&P)(1)
Tenant NRSF% of
NRSF
Annual U/W Base Rent PSF(2)Annual
U/W Base Rent(2)
% of Total Annual U/W Base RentLease
Expiration
Date
Extension OptionsTermination Option (Y/N)
Anchor Tenants        
Ralphs Fresh FareNR/Baa1/BBB36,20031.7%$7.90$286,0005.8%8/30/2023NN
CVSNR/Baa2/BBB22,88020.0%$6.56$150,0003.0%1/31/20251, 5-yearN
Total Anchor Tenants 59,08051.7%$7.38$436,0008.9%   
          
Major Tenants         
Zinque(3)NR/NR/NR6,3875.6%$58.24$372,0007.6%3/31/20321, 5-yearY
Bank of AmericaA+/A2/A-5,0324.4%$146.06$734,97414.9%12/31/20262, 5-yearN
Coogie’s Beach CaféNR/NR/NR3,5943.1%$140.26$504,11010.2%11/11/20251, 5-yearN
Becker SurfboardsNR/NR/NR3,2292.8%$75.73$244,5325.0%10/31/20251, 5-year N
Chase BankAA-/Aa1/A+3,0202.6%$102.00$308,0406.3%9/30/20282, 5-yearN
Total Major Tenants21,26218.6%$101.76$2,163,65643.9%   
          
Non-Major Tenants21,99719.2%$105.75$2,326,10047.2%   
         
Occupied Collateral Total102,33989.5%$48.13$4,925,756100.0%   
         
Vacant Space12,03110.5%      
         
Collateral Total114,370100.0%      
          
(1)Certain ratings are those of the parent company whether or not the parent company guarantees the lease.

(2)Annual U/W Base Rent PSF and Annual U/W Base Rent include contractual rent steps through April 2022 totaling $49,800.

(3)It is anticipated that Zinque will take occupancy and commence paying rent at the Malibu Colony Plaza Property in April 2022. The borrower sponsors have signed a 10-year Master Lease on the space until Zinque is in occupancy and paying rent. Zinque has the option to terminate its lease on November 8, 2021 if it cannot obtain a Type 47 liquor license and all other necessary permits, licenses and other government approvals needed for the tenant’s work and to operate its business at the Malibu Colony Plaza Property.

 

The following table presents certain information relating to tenant sales at the Malibu Colony Plaza Property:

 

Tenant Sales (PSF)

 

Major Tenant Name% of Total Annual U/W Base Rent201820192020Anchor Tenant Occupancy Cost(1)
Ralphs Fresh Fare5.8%NAP$616$7205.1%
CVS3.0%$481$451$4906.8%
(1)Occupancy Cost is based on 2020 sales, underwritten base rent and underwritten reimbursements.

 

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.

 

65

 

 

Retail - AnchoredLoan #3Cut-off Date Balance: $48,000,000
23705 Malibu RoadMalibu Colony PlazaCut-off Date LTV: 50.5%
Malibu, CA 90265 U/W NCF DSCR: 2.10x
  U/W NOI Debt Yield: 8.1%

 

The following table presents certain information relating to the lease rollover schedule at the Malibu Colony Plaza Property:

 

Lease Expiration Schedule(1)(2)

 

Year Ending
 December 31,
No. of Leases ExpiringExpiring NRSF% of Total NRSFCumulative Expiring NRSFCumulative % of Total NRSFAnnual
 U/W
Base Rent
% of Total Annual U/W Base RentAnnual
 U/W
Base Rent
 PSF
MTM33,0882.7%3,0882.7%$300,4426.1%$97.29
2021000.0%3,0882.7%$00.0%$0.00
202211,0800.9%4,1683.6%$105,8402.1%$98.00
2023442,36637.0%46,53440.7%$937,14719.0%$22.12
202411,2021.1%47,73641.7%$118,0242.4%$98.19
2025736,67832.1%84,41473.8%$1,668,13033.9%$45.48
202637,1736.3%91,58780.1%$936,37019.0%$130.54
2027000.0%91,58780.1%$00.0%$0.00
202824,3653.8%95,95283.9%$487,8039.9%$111.75
2029000.0%95,95283.9%$00.0%$0.00
2030000.0%95,95283.9%$00.0%$0.00
2031000.0%95,95283.9%$00.0%$0.00
Thereafter16,3875.6%102,33989.5%$372,0007.6%$58.24
Vacant012,03110.5% 114,370100.0%    $00.0%$0.00
Total/Weighted Average(3)22114,370100.0%  $4,925,756100.0%$48.13
(1)Information obtained from the underwritten rent roll.

(2)Certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date of the subject lease and that are not considered in the Lease Expiration Schedule.

(3)Total Annual U/W Base Rent PSF excludes vacant space.

 

The following table presents historical occupancy percentages at the Malibu Colony Plaza Property:

 

Historical Occupancy

 

12/31/2018(1) 

12/31/2019(1) 

12/31/2020(1) 

4/8/2021(2) 

86.0%91.0%90.0%89.5%
(1)Information obtained from the Malibu Colony Plaza Borrower.

(2)Information obtained from the underwritten rent roll dated April 8, 2021.

 

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.

 

66

 

 

Retail - AnchoredLoan #3Cut-off Date Balance: $48,000,000
23705 Malibu RoadMalibu Colony PlazaCut-off Date LTV: 50.5%
Malibu, CA 90265 U/W NCF DSCR: 2.10x
  U/W NOI Debt Yield: 8.1%

 

Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the underwritten net cash flow at the Malibu Colony Plaza Property:

 

Cash Flow Analysis

 

 20192020TTM 3/31/2021U/W%(1)U/W $
per SF
Rents in Place$4,606,043$3,764,696$3,573,023$4,875,95655.5%$42.63
Contractual Rent Steps(2)00049,800       0.6    0.44
Percentage Rent44,58997,129100,786100,786        1.1   0.88
Grossed Up Vacant Space

0

0

0

1,051,360

12.0   

9.19

Gross Potential Rent$4,650,633$3,861,825$3,673,809$6,077,90369.1%$53.14
Other Income19,3895,36489215,570      0.2   0.14