FREE WRITING PROSPECTUS | ||
FILED PURSUANT TO RULE 433 | ||
REGISTRATION FILE NO.: 333-258342-01 | ||
JANUARY [ ], 2022
BENCHMARK 2022-B32 Commercial Mortgage Trust Draft Collateral Term Sheet
This material is for your information, and none of J.P. Morgan Securities LLC (“JPMS”), Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, Drexel Hamilton, LLC and Academy Securities, Inc., (each individually, an “Underwriter”, and together, the ’’Underwriters’’) are soliciting any action based upon it. This material is not to be construed as an offer to sell or the solicitation of any offer to buy any security in any jurisdiction where such an offer or solicitation would be illegal.
The depositor has filed a registration statement (including a prospectus) with the SEC (SEC File No. 333-258342) for the offering to which this free writing prospectus relates. Before you invest, you should read the prospectus in the registration statement and other documents the depositor has filed with the SEC for more complete information about the depositor, the issuing entity and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the depositor, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling (800) 408-1016 or by emailing the ABS Syndicate Desk at abs_synd@jpmorgan.com.
THE SECURITIES TO WHICH THIS INFORMATION RELATES WILL BE MORE FULLY DESCRIBED IN A PROSPECTUS (THE “PROSPECTUS”), WHICH IS NOT YET AVAILABLE. THE PROSPECTUS WILL CONTAIN MATERIAL INFORMATION THAT IS NOT CONTAINED IN THESE MATERIALS (INCLUDING WITHOUT LIMITATION A DETAILED DISCUSSION OF RISKS ASSOCIATED WITH AN INVESTMENT IN THE CERTIFICATES, UNDER THE HEADING “RISK FACTORS” IN THE PROSPECTUS).
Neither this document nor anything contained in this document shall form the basis for any contract or commitment whatsoever. The information contained in this document is preliminary as of the date of this document, supersedes any previous such information delivered to you and will be superseded by any such information subsequently delivered prior to the time of sale. These materials are subject to change, completion or amendment from time to time. This information is based upon management forecasts and reflects prevailing conditions and management’s views as of this date, all of which are subject to change.
J.P. Morgan is the marketing name for the investment banking businesses of JPMorgan Chase & Co. and its subsidiaries worldwide. Securities, syndicated loan arranging, financial advisory and other investment banking activities are performed by JPMS and its securities affiliates, and lending, derivatives and other commercial banking activities are performed by JPMorgan Chase Bank, National Association and its banking affiliates. JPMS is a member of SIPC and the NYSE. Securities and investment banking activities in the United States are performed by Deutsche Bank Securities Inc., a member of NYSE, FINRA and SIPC, and its broker-dealer affiliates. Lending and other commercial banking activities in the United States are performed by Deutsche Bank AG, acting through its New York Branch.
THE UNDERWRITERS MAY FROM TIME TO TIME PERFORM INVESTMENT BANKING SERVICES FOR, OR SOLICIT INVESTMENT BANKING BUSINESS FROM, ANY COMPANY NAMED IN THESE MATERIALS. THE UNDERWRITERS AND/OR THEIR AFFILIATES OR RESPECTIVE EMPLOYEES MAY FROM TIME TO TIME HAVE A LONG OR SHORT POSITION IN ANY CERTIFICATE OR CONTRACT DISCUSSED IN THESE MATERIALS.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Collateral Characteristics |
Loan Pool | ||
Initial Pool Balance (“IPB”): | $1,774,834,674 | |
Number of Mortgage Loans: | 47 | |
Number of Mortgaged Properties: | 171 | |
Average Cut-off Date Balance per Mortgage Loan: | $37,762,440 | |
Weighted Average Current Mortgage Rate: | 3.53779% | |
10 Largest Mortgage Loans as % of IPB: | 51.7% | |
Weighted Average Remaining Term to Maturity(1): | 98 months | |
Weighted Average Seasoning: | 1 month | |
Credit Statistics | ||
Weighted Average UW NCF DSCR(2)(3): | 3.03x | |
Weighted Average UW NOI DY(2)(4): | 11.5% | |
Weighted Average Cut-off Date Loan-to-Value Ratio (“LTV”)(2)(4)(5): | 55.4% | |
Weighted Average Maturity Date LTV(1)(2)(5): | 54.4% | |
Other Statistics | ||
% of Mortgage Loans with Additional Debt(4): | 25.0% | |
% of Mortgaged Properties with Single Tenants: | 32.2% | |
Amortization | ||
Weighted Average Original Amortization Term(5): | 360 months | |
Weighted Average Remaining Amortization Term(5): | 360 months | |
% of Mortgage Loans with Interest-Only: | 74.1% | |
% of Mortgage Loans with Interest Only-ARD: | 14.1% | |
% of Mortgage Loans with Partial Interest-Only followed by Amortizing Balloon: | 8.2% | |
% of Mortgage Loans with Amortizing Balloon: | 3.5% | |
Lockbox / Cash Management(6) | ||
% of Mortgage Loans with In-Place, Hard Lockboxes: | 67.3% | |
% of Mortgage Loans with Springing Lockboxes: | 20.6% | |
% of Mortgage Loans with In-Place, Soft Lockboxes: | 4.7% | |
% of Mortgage Loans with Springing (Residential) Lockboxes / Hard (Commercial): | 7.0% | |
% of Mortgage Loans with Soft (Residential) / Hard (Commercial): | 0.5% | |
% of Mortgage Loans with In-Place Cash Management: | 8.3% | |
Reserves | ||
% of Mortgage Loans Requiring Monthly Tax Reserves: | 66.9% | |
% of Mortgage Loans Requiring Monthly Insurance Reserves: | 37.2% | |
% of Mortgage Loans Requiring Monthly CapEx Reserves(7): | 55.8% | |
% of Mortgage Loans Requiring Monthly TI/LC Reserves(8): | 38.1% |
(1) | In the case of Loan Nos. 4, 5 and 12, each with an anticipated repayment date, Remaining Term to Maturity and Maturity Date LTV are calculated as of the related anticipated repayment date. |
(2) | In the case of Loan Nos . 1, 2, 3, 4, 7, 8, 10, 11, 12, 13, 17, 19, 20, 21, 23, 25, 27 and 28, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 4, 5, 10, 18 and 23, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s), related mezzanine loan(s) and/or related additional secured subordinate debt. |
(3) | In the case of Loan Nos. 1, 4, 8 and 22, Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details. |
(4) | Excludes Loan No. 8 with respect to preferred equity contributions in connection with, and to partially fund, the acquisition of the related Mortgaged Property. For a more detailed description, refer to “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—Additional Indebtedness” in the Preliminary Prospectus. |
(5) | Excludes 38 mortgage loans that are interest-only for the entire term. |
(6) | For a more detailed description of Lockbox / Cash Management, refer to “Description of the Mortgage Pool—Certain Terms of the Mortgage Loans—Mortgaged Property Accounts” in the Preliminary Prospectus. |
(7) | CapEx Reserves include FF&E reserves for hotel properties. |
(8) | Calculated only with respect to the Cut-off Date Balance of mortgage loans secured or partially secured by retail, office, industrial and mixed use properties. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Collateral Characteristics |
Mortgage Loan Seller | Number of | Number of | Aggregate | % of IPB |
CREFI(1) | 24 | 72 | $620,477,473 | 35.0% |
GSMC(1)(2) | 11 | 18 | $431,702,201 | 24.3% |
GACC(1)(3) | 6 | 60 | $377,275,000 | 21.3% |
JPMCB(1) | 5 | 20 | $320,380,000 | 18.1% |
GACC / CREFI(1)(4) | 1 | 1 | $25,000,000 | 1.4% |
Total | 47 | 171 | $1,774,834,674 | 100.0% |
(1) | In the case of Loan No. 2, the whole loan was co-originated by JPMCB and Starwood Mortgage Capital. In the case of Loan No. 4, the whole loan was co-originated by DBRI, JPMCB, Bank of America, N.A. (“BANA”), and 3650 Cal Bridge Lending, LLC. In the case of Loan No. 10, the whole loan was co-originated by Goldman Sachs Bank USA (“GSBI”) and Barclays Capital Real Estate Inc. (“BCREI”). In the case of Loan No. 11, the whole loan was co-originated by CREFI and BCREI. In the case of Loan No. 23, the whole loan was co-originated by DBRI, Morgan Stanley Bank, N.A, and Wells Fargo Bank, National Association. |
(2) | Each mortgage loan being sold by Goldman Sachs Mortgage Company (“GSMC”) was originated or co-originated by an affiliate of GSMC, GSBI, and will be transferred to GSMC on or prior to the Closing Date. |
(3) | Each mortgage loan being sold by German American Capital Corporation (“GACC”) was originated or co-originated by DBR Investments Co. Limited, an affiliate of GACC, and will be transferred to GACC on or prior to the Closing Date. |
(4) | In the case of Loan No. 23, the whole loan was co-originated by GACC and CREFI. Loan No. 23 is evidenced by two promissory notes: (i) Note A-2-C2-2 with a principal balance of $12,800,000 as of the Cut-off Date, as to which GACC is acting as mortgage loan seller, and (ii) Note A-4-C2-2, with a principal balance of $12,200,000 as of the Cut-off Date, as to which CREFI is acting as mortgage loan seller. |
Ten Largest Mortgage Loans |
No. | Loan Name | Mortgage Loan Seller | No. of Prop. | Cut-off Date Balance | % of IPB | SF / Units | Property Type | UW NCF DSCR(1) | UW NOI DY(1) | Cut-off Date LTV(1)(2) | Maturity Date LTV(1)(2) |
1 | Old Chicago Post Office | JPMCB | 1 | $125,000,000 | 7.0% | 2,331,477 | Office | 4.22x | 14.9% | 43.1% | 43.1% |
2 | Bedrock Portfolio | JPMCB | 14 | $125,000,000 | 7.0% | 2,694,627 | Various | 3.30x | 13.6% | 59.4% | 59.4% |
3 | Rosewood National Storage 13 | GACC | 13 | $108,575,000 | 6.1% | 1,564,651 | Self Storage | 3.13x | 9.8% | 59.7% | 59.7% |
4 | CX - 350 & 450 Water Street | GACC | 1 | $101,000,000 | 5.7% | 915,233 | Mixed Use | 3.50x | 9.9% | 41.7% | 41.7% |
5 | One Wilshire | GSMC | 1 | $90,000,000 | 5.1% | 661,553 | Office | 4.45x | 12.7% | 32.3% | 32.3% |
6 | SVEA New Mexico Portfolio | GACC | 40 | $78,550,000 | 4.4% | 652,850 | Office | 2.95x | 12.4% | 65.0% | 65.0% |
7 | JW Marriott Desert Springs | GSMC | 1 | $75,000,000 | 4.2% | 884 | Hospitality | 3.14x | 20.4% | 41.8% | 41.8% |
8 | Woodmore Towne Centre | GSMC | 1 | $75,000,000 | 4.2% | 712,091 | Retail | 2.96x | 10.4% | 59.5% | 59.5% |
9 | Dealertrack and Divvy | CREFI | 2 | $74,500,000 | 4.2% | 318,832 | Office | 1.96x | 9.4% | 68.0% | 68.0% |
10 | The Summit | GSMC | 1 | $65,000,000 | 3.7% | 907,306 | Office | 4.11x | 12.6% | 36.5% | 36.5% |
Top 3 Total/Weighted Average | 28 | $358,575,000 | 20.2% | 3.57x | 12.9% | 53.8% | 53.8% | ||||
Top 5 Total/Weighted Average | 30 | $549,575,000 | 31.0% | 3.70x | 12.3% | 48.1% | 48.1% | ||||
Top 10 Total/Weighted Average | 75 | $917,625,000 | 51.7% | 3.42x | 12.6% | 50.7% | 50.7% |
(1) | In the case of Loan Nos. 1, 2, 4, 5, 7, 8 and 10, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 4, 5, and 10, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s), related mezzanine loan(s) and/or related additional secured subordinate debt. |
(2) | In the case of Loan Nos. 1, 4, and 8, Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Collateral Characteristics |
Companion Loan Summary | ||||||||
Loan No. | Mortgage Loan | Note(s) | Original Balance ($) | Cut-off Date Balance ($) | Holder of Note | Lead Servicer for Whole Loan (Y/N) | Master Servicer Under Lead Securitization | Special Servicer Under Lead Securitization |
1 | Old Chicago Post Office | A-1, A-2, A-3, A-4, A-7, B (1) | $705,000,000 | $705,000,000 | JPMCC 2022-OPO | Yes | KeyBank | KeyBank |
A-5, A-6 | $125,000,000 | $125,000,000 | Benchmark 2022-B32 | No | ||||
Total | $830,000,000 | $830,000,000 | ||||||
2 | Bedrock Portfolio | A-1-1 | $125,000,000 | $125,000,000 | Benchmark 2022-B32 | Yes | Midland | KeyBank |
A-1-2 | $50,000,000 | $50,000,000 | JPMCB | No | ||||
A-1-3 | $50,000,000 | $50,000,000 | JPMCB | No | ||||
A-1-4 | $50,000,000 | $50,000,000 | JPMCB | No | ||||
A-1-5 | $30,000,000 | $30,000,000 | JPMCB | No | ||||
A-1-6 | $39,000,000 | $39,000,000 | JPMCB | No | ||||
A-2-1 | $40,000,000 | $40,000,000 | SMC | No | ||||
A-2-2 | $26,000,000 | $26,000,000 | SMC | No | ||||
A-2-3 | $10,000,000 | $10,000,000 | SMC | No | ||||
A-2-4 | $10,000,000 | $10,000,000 | SMC | No | ||||
Total | $430,000,000 | $430,000,000 | ||||||
4 | CX – 350 & 450 Water Street | A-1-1, A-2-1, A-3-1, A-4-1, B-1(1), B-2(1), B-3(1), B-4(1) | $696,000,000 | $696,000,000 | CAMB 2021-CX2 | Yes | KeyBank | Situs |
A-1-2, A-1-4, A-1-9, A-3-3 | $148,140,816 | $148,140,816 | Benchmark 2021-B31 | No | ||||
A-1-3, A-3-2 | $94,000,000 | $94,000,000 | Benchmark 2021-B30 | No | ||||
A-1-5, A-1-6, A-1-8 | $101,000,000 | $101,000,000 | Benchmark 2022-B32 | No | ||||
A-1-7, A-4-2, A-4-3 | $77,900,000 | $77,900,000 | 3650R 2021-PF1 | No | ||||
A-2-2 | $50,000,000 | $50,000,000 | BANA | No | ||||
A-2-3, A-2-4 | $55,000,000 | $55,000,000 | BANK 2021-BNK39 | No | ||||
A-2-5 | $2,959,184 | $2,959,184 | BANA | No | ||||
Total | $1,225,000,000 | $1,225,000,000 | ||||||
5 | One Wilshire | A-1 | $90,000,000 | $90,000,000 | Benchmark 2022-B32 | Yes(2) | Midland | KeyBank |
A-2 | $120,000,00 | $120,000,00 | GSBI | No | ||||
A-3 | $85,000,000 | $85,000,000 | GSBI | No | ||||
B-1(1) | $94,250,000 | $94,250,000 | Benchmark 2022-B32 | No(2) | ||||
Total | $389,250,000 | $389,250,000 | ||||||
7 | JW Marriott Desert Springs | A-1 | $75,000,000 | $75,000,000 | Benchmark 2022-B32 | Yes | Midland | KeyBank |
A-2 | $53,000,000 | $53,000,000 | GSBI | No | ||||
Total | $128,000,000 | $128,000,000 | ||||||
8 | Woodmore Towne Centre | A-1 | $75,000,000 | $75,000,000 | Benchmark 2022-B32 | Yes | Midland | KeyBank |
A-2 | $39,066,666.67 | $39,066,666.67 | GSBI | No | ||||
A-3 | $3,133,333.33 | $3,133,333.33 | GSBI | No | ||||
Total | $117,200,000 | $117,200,000 | ||||||
10 | The Summit | A-1-S, A-2-S, B-1-1(1), B-2-1(1) | $305,000,000 | $305,000,000 | SUMIT 2022-BVUE | Yes | KeyBank | KeyBank |
A-1-1 | $50,000,000 | $50,000,000 | BCREI | Yes | ||||
A-1-2 | $50,000,000 | $50,000,000 | BCREI | No | ||||
A-1-3 | $25,000,000 | $25,000,000 | BCREI | No | ||||
A-1-4 | $7,000,000 | $7,000,000 | BCREI | No | ||||
A-2-1 | $65,000,000 | $65,000,000 | Benchmark 2022-B32 | No | ||||
A-2- | $23,000,000 | $23,000,000 | GSBI | No | ||||
Total | $525,000,000 | $525,000,000 | ||||||
11 | Moonwater Office | A-1, A-2 | $63,000,000 | $63,000,000 | Benchmark 2022-B32 | Yes | Midland | KeyBank |
A-3 | $35,000,000 | $35,000,000 | BCREI | |||||
A-4 | $18,000,000 | $18,000,000 | BCREI | |||||
Total | $116,000,000 | $116,000,000 | ||||||
12 | Novo Nordisk HQ | A-1 | $75,000,000 | $75,000,000 | Benchmark 2021-B31 | Yes | Midland | Rialto |
A-2, A-3-1 | $60,000,000 | $60,000,000 | Benchmark 2022-B32 | No | ||||
A-3-2, A-4 | $75,667,000 | $75,667,000 | DBRI | No | ||||
Total | $210,667,000 | $210,667,000 | ||||||
13 | The Kirby Collection | A-1 | $55,000,000 | $55,000,000 | Benchmark 2022-B32 | Yes | Midland | KeyBank |
A-2 | $40,661,369 | $40,661,369 | CREFI | No | ||||
Total | $95,661,469 | $95,661,469 | ||||||
22 | 425 Eye Street | A-1 | $62,400,000 | $62,400,000 | GSMS 2021-GSA3 | Yes | Wells | Argentic |
A-2 | $39,818,000 | $39,818,000 | Benchmark 2022-B32 | No | ||||
Total | $102,218,000 | $102,218,000 | ||||||
25 | Grede Casting Industrial Portfolio | A-1 | $30,000,000 | $30,000,000 | Benchmark 2022-B32 | Yes | Midland | KeyBank |
A-2 | $18,225,000 | $18,225,000 | GSBI | No | ||||
Total | $48,225,000 | $48,225,000 | ||||||
20 | ExchangeRight Net Leased Portfolio #53 | A-1 | $30,000,000 | $30,000,000 | Benchmark 2022-B32 | No(3) | ||
A-2 | $56,000,000 | $56,000,000 | CREFI | Yes | (3) | (3) | ||
Total | $86,000,000 | $86,000,000 |
(1) | Each note represents a subordinate companion loan. |
(2) | In the case of Loan No. 5, the initial control note is Note B-1. During the continuance of a One Wilshire Control Appraisal Period, Note A-1 will be the Control Note. See “Description of the Mortgage Pool—The Whole Loans—The Serviced AB Whole Loans—The One Wilshire Whole Loan” in the Preliminary Prospectus. |
(3) | In the case of Loan No. 20, the related whole loan is expected to be serviced under the Benchmark 2022-B32 pooling and servicing agreement until such time as the related controlling note has been securitized, at which point the related whole loan will be serviced under the pooling and servicing agreement related to such securitization. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Collateral Characteristics |
Loan No. | Mortgage Loan | Note(s) | Original Balance ($) | Cut-off Date Balance ($) | Holder of Note | Lead Servicer for Whole Loan (Y/N) | Master Servicer Under Lead Securitization | Special Servicer Under Lead Securitization |
21 | Glen Forest Office Portfolio | A-1 | $30,000,000 | $30,000,000 | Benchmark 2022-B32 | Yes | Midland | KeyBank |
A-2 | $29,000,000 | $29,000,000 | CREFI | No | ||||
Total | $59,000,000 | $59,000,000 | ||||||
23 | 601 Lexington | A-1-S1, A-2-S1, A-3-S1, A-4-S1, B-1(1), B-2(1), B-3(1), B-4(1) | $426,700,000 | $426,700,000 | BXP 2021-601L | Yes | Wells Fargo | Situs |
A-1-C1 | $17,500,000 | $17,500,000 | WFNA | No | ||||
A-1-C2 | $67,543,860 | $67,543,860 | WFNA | No | ||||
A-1-C3 | $67,543,860 | $67,543,860 | WFNA | No | ||||
A-1-C4 | $48,067,280 | $48,067,280 | WFNA | No | ||||
A-2-C1 | $11,000,000 | $11,000,000 | DBRI | No | ||||
A-2-C2-1 | $43,479,070 | $43,479,070 | DBRI | No | ||||
A-2-C2-2, A-4-C2-2 | $25,000,000 | $25,000,00 | Benchmark 2022-B32 | No | ||||
A-2-C3 | $56,279,070 | $56,279,070 | DBRI | No | ||||
A-2-C4 | $2,567,860 | $2,567,860 | DBRI | No | ||||
A-3-C1 | $11,000,000 | $11,000,000 | MSBNA | No | ||||
A-3-C2 | $42,456,140 | $42,456,140 | MSBNA | No | ||||
A-3-C3 | $42,456,140 | $42,456,140 | MSBNA | No | ||||
A-3-C4 | $30,213,720 | $30,213,720 | MSBNA | No | ||||
A-4-C1 | $10,500,000 | $10,500,000 | CREFI | No | ||||
A-4-C2-1 | $41,520,930 | $41,520,930 | CREFI | No | ||||
A-4-C3 | $53,720,930 | $53,720,930 | CREFI | No | ||||
A-4-C4 | $2,451,140 | $2,451,140 | CREFI | No | ||||
Total | $1,000,000,000 | $1,000,000,000 | ||||||
25 | Nyberg Portfolio | A-1 | $40,000,000 | $40,000,000 | Benchmark 2021-B31 | Yes | Midland | Rialto |
A-2 | $23,900,000 | $23,900,000 | Benchmark 2022-B32 | No | ||||
Total | $63,900,000 | $63,900,000 | ||||||
27 | Sara Lee Portfolio | A-1 | $40,000,000 | $40,000,000 | Benchmark 2021-B31 | Yes | Midland | Rialto |
A-2 | $23,150,000 | $23,150,000 | Benchmark 2022-B32 | No | ||||
Total | $63,150,000 | $63,150,000 | ||||||
28 | Charcuterie Artisans SLB | A-1 | $40,000,000 | $40,000,000 | Benchmark 2021-B21 | Yes | Midland | Rialto |
A-2 | $23,000,000 | $23,000,000 | Benchmark 2022-B32 | No | ||||
Total | $63,000,000 | $63,000,000 |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Collateral Characteristics |
Additional Debt Summary |
No. | Loan Name | Trust | Subordinate Debt Cut-off Date Balance(1) | Total Debt Cut-off Date Balance | Mortgage Loan UW NCF DSCR(2) | Total Debt UW NCF DSCR | Mortgage Loan | Total Debt Cut-off Date LTV | Mortgage Loan UW NOI DY(2)(3) | Total Debt UW NOI DY |
1 | Old Chicago Post Office | $125,000,000 | $317,200,000 | $955,000,000 | 4.22x | 1.90x | 43.1% | 80.3% | 14.9% | 8.0% |
4 | CX - 350 & 450 Water Street | $101,000,000 | $411,000,000 | $1,225,000,000 | 3.50x | 2.32x | 41.7% | 62.7% | 9.9% | 6.6% |
5 | One Wilshire | $90,000,000 | $94,250,000 | $389,250,000 | 4.45x | 3.37x | 32.3% | 42.6% | 12.7% | 9.6% |
10 | The Summit | $65,000,000 | $198,000,000 | $525,000,000 | 4.11x | 2.56x | 36.5% | 58.6% | 12.6% | 7.8% |
18 | The Onyx | $38,000,000 | $7,000,000 | $45,000,000 | 2.28x | 1.58x | 63.1% | 74.8% | 9.4% | 7.9% |
23 | 601 Lexington Avenue | $25,000,000 | $276,700,000 | $1,000,000,000 | 4.50x | 3.25x | 42.5% | 58.8% | 13.2% | 9.5% |
(1) | In the case of Loan Nos., 1, 4, 5, 10 and 23, Subordinate Debt Cut-off Date Balance represents one or more Subordinate Companion Loan(s) and/or related mezzanine loan(s). In the case of Loan No. 18, Subordinate Debt Cut-off Date Balance represents one or more mezzanine loans. |
(2) | In the case of Loan Nos. 1, 4, 5, 10 and 23, Mortgage Loan UW NCF DSCR, Mortgage Loan UW NOI DY and Mortgage Loan Cut-off Date LTV calculations exclude the related Subordinate Companion Loan(s) and/or related mezzanine loan(s). In the case of Loan No. 18, Mortgage Loan UW NCF DSCR, Mortgage Loan UW NOI DY and Mortgage Loan Cut-off Date LTV calculations exclude the related mezzanine loan(s). |
(3) | In the case of Loan No. 4, Mortgage Loan Cut-Off Date LTV and Total Debt Cut-Off Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
6 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Collateral Characteristics |
Mortgaged Properties by Type(1) |
Weighted Average | |||||||||
Property Type | Property Subtype | Number of Properties | Cut-off Date Principal Balance | % of IPB | Occupancy | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (2)(3)(4) |
Office | Suburban | 67 | $475,865,606 | 26.8% | 95.6% | 2.31x | 10.2% | 64.3% | 62.4% |
CBD | 10 | 308,130,000 | 17.4 | 93.2% | 3.94x | 13.9% | 46.6% | 46.6% | |
CBD/Data Center | 1 | 90,000,000 | 5.1 | 87.3% | 4.45x | 12.7% | 32.3% | 32.3% | |
Urban | 1 | 39,818,000 | 2.2 | 76.7% | 3.66x | 11.0% | 56.8% | 56.8% | |
Medical | 2 | 5,089,794 | 0.3 | 56.6% | 2.80x | 10.8% | 59.6% | 59.6% | |
Subtotal: | 81 | $918,903,400 | 51.8% | 92.9% | 3.13x | 11.7% | 54.9% | 53.9% | |
Mixed Use | Office/Lab | 1 | $101,000,000 | 5.7% | 100.0% | 3.50x | 9.9% | 41.7% | 41.7% |
Multifamily/Office/Retail | 2 | 58,987,500 | 3.3 | 90.8% | 3.82x | 12.1% | 48.9% | 48.9% | |
Retail/Office | 1 | 23,467,534 | 1.3 | 89.6% | 1.56x | 9.5% | 65.7% | 51.9% | |
Multifamily/Retail | 3 | 10,237,500 | 0.6 | 91.9% | 2.34x | 9.6% | 55.2% | 55.2% | |
Subtotal: | 7 | $193,692,534 | 10.9% | 95.5% | 3.30x | 10.5% | 47.5% | 45.8% | |
Retail | Anchored | 7 | $177,190,916 | 10.0% | 96.3% | 2.90x | 10.7% | 60.8% | 59.5% |
Single Tenant | 23 | 17,089,535 | 1.0 | 100.0% | 2.68x | 9.6% | 53.9% | 53.9% | |
Subtotal: | 30 | $194,280,451 | 10.9% | 96.7% | 2.88x | 10.6% | 60.2% | 59.0% | |
Self Storage | Self Storage | 21 | $151,975,000 | 8.6% | 95.3% | 2.93x | 9.5% | 60.6% | 60.6% |
Subtotal: | 21 | $151,975,000 | 8.6% | 95.3% | 2.93x | 9.5% | 60.6% | 60.6% | |
Industrial | Flex | 5 | $59,367,344 | 3.3% | 96.0% | 2.30x | 9.5% | 60.3% | 58.4% |
Manufacturing | 12 | 46,816,730 | 2.6 | 100.0% | 2.79x | 11.9% | 59.9% | 58.1% | |
Warehouse | 1 | 14,912,656 | 0.8 | 100.0% | 2.34x | 9.3% | 62.8% | 62.8% | |
Cold Storage | 2 | 12,434,794 | 0.7 | 100.0% | 2.06x | 8.9% | 60.6% | 60.6% | |
Subtotal: | 20 | $133,531,523 | 7.5% | 98.2% | 2.45x | 10.3% | 60.5% | 59.0% | |
Hospitality | Full Service | 1 | $75,000,000 | 4.2% | 36.8% | 3.14x | 20.4% | 41.8% | 41.8% |
Limited Service | 1 | 18,000,000 | 1.0 | 61.0% | 3.44x | 15.1% | 53.7% | 53.7% | |
Extended Stay | 1 | 7,991,766 | 0.5 | 96.2% | 2.46x | 17.4% | 65.0% | 57.7% | |
Subtotal: | 3 | $100,991,766 | 5.7% | 45.8% | 3.14x | 19.2% | 45.8% | 45.2% | |
Multifamily | Garden | 3 | $53,490,000 | 3.0% | 95.4% | 2.23x | 9.4% | 63.1% | 63.1% |
Mid Rise | 1 | 2,275,000 | 0.1 | 100.0% | 2.09x | 8.0% | 64.6% | 64.6% | |
Subtotal: | 4 | $55,765,000 | 3.1% | 95.6% | 2.23x | 9.3% | 63.2% | 63.2% | |
Other | Parking Garage | 5 | $25,695,000 | 1.4% | NAP | 3.30x | 13.6% | 59.4% | 59.4% |
Subtotal: | 5 | $25,695,000 | 1.4% | NAP | 3.30x | 13.6% | 59.4% | 59.4% | |
Total / Weighted Average: | 171 | 1,774,834,674 | 100.0% | 91.6%(5) | 3.03x | 11.5% | 55.4% | 54.4% |
(1) | Because this table presents information relating to the mortgaged properties and not mortgage loans, the information for mortgage loans secured by more than one mortgaged property is based on allocated loan amounts. |
(2) | In the case of Loan Nos. 1, 2, 3, 4, 7, 8, 10, 11, 12, 13, 17, 19, 20, 21, 23, 25, 27 and 28, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 4, 5, 10, 18 and 23, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s), related mezzanine loan(s) and/or related additional secured subordinate debt. |
(3) | In the case of Loan Nos. 1, 4, 8 and 22, Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details. |
(4) | In the case of Loan Nos. 4, 5 and 12, each with an anticipated repayment date, Maturity Date LTV is calculated as of the related anticipated repayment date. |
(5) | Excludes occupancy for five properties in connection with Loan No. 2 as the collateral consists of parking garages with no attributable occupancy. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
7 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Collateral Characteristics |
Mortgaged Properties by Location(1) | ||||||||
Weighted Average | ||||||||
State | Number of Properties | Cut-off Date Principal Balance | % of IPB | Occupancy | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (2)(3)(4) |
California | 3 | $171,000,000 | 9.6% | 65.6% | 3.84x | 16.1% | 36.4% | 36.4% |
Illinois | 4 | 148,066,512 | 8.3 | 93.1% | 4.00x | 14.2% | 45.3% | 45.3% |
Michigan | 18 | 145,541,005 | 8.2 | 91.4% | 3.15x | 13.1% | 59.6% | 59.2% |
Texas | 7 | 138,612,065 | 7.8 | 94.4% | 3.11x | 10.5% | 56.2% | 56.2% |
Massachusetts | 2 | 101,495,437 | 5.7 | 100.0% | 3.49x | 9.9% | 41.8% | 41.8% |
New Mexico | 41 | 85,910,100 | 4.8 | 97.4% | 2.97x | 12.2% | 64.5% | 64.5% |
Ohio | 6 | 82,676,488 | 4.7 | 99.2% | 1.95x | 9.4% | 65.8% | 61.6% |
Virginia | 12 | 78,490,000 | 4.4 | 90.9% | 2.97x | 10.6% | 64.3% | 64.3% |
Maryland | 1 | 75,000,000 | 4.2 | 96.7% | 2.96x | 10.4% | 59.5% | 59.5% |
Utah | 2 | 74,500,000 | 4.2 | 100.0% | 1.96x | 9.4% | 68.0% | 68.0% |
Washington | 2 | 66,148,613 | 3.7 | 98.2% | 4.07x | 12.5% | 36.9% | 36.9% |
Nevada | 6 | 63,000,000 | 3.5 | 97.6% | 1.42x | 9.0% | 59.1% | 52.7% |
New Jersey | 1 | 60,000,000 | 3.4 | 77.0% | 3.16x | 9.2% | 63.8% | 63.8% |
Florida | 4 | 56,240,856 | 3.2 | 95.8% | 2.72x | 9.4% | 61.7% | 61.7% |
Pennsylvania | 11 | 51,856,058 | 2.9 | 95.1% | 2.05x | 9.7% | 64.4% | 60.9% |
South Carolina | 3 | 49,756,165 | 2.8 | 99.6% | 2.57x | 10.5% | 63.7% | 63.7% |
Georgia | 5 | 45,828,343 | 2.6 | 79.1% | 2.90x | 13.1% | 59.1% | 57.9% |
New York | 7 | 44,166,279 | 2.5 | 97.9% | 3.58x | 11.5% | 48.9% | 48.9% |
Connecticut | 4 | 39,991,141 | 2.3 | 93.2% | 2.16x | 10.0% | 63.4% | 55.3% |
District of Columbia | 1 | 39,818,000 | 2.2 | 76.7% | 3.66x | 11.0% | 56.8% | 56.8% |
North Carolina | 4 | 26,552,510 | 1.5 | 100.0% | 2.27x | 9.3% | 59.4% | 59.4% |
Oregon | 2 | 23,900,000 | 1.3 | 95.8% | 3.14x | 12.5% | 60.0% | 60.0% |
Rhode Island | 1 | 23,000,000 | 1.3 | 100.0% | 2.35x | 9.2% | 57.7% | 57.7% |
Minnesota | 3 | 17,706,502 | 1.0 | 96.9% | 2.29x | 11.4% | 65.3% | 58.9% |
Arizona | 1 | 16,975,916 | 1.0 | 97.3% | 1.77x | 10.3% | 65.3% | 51.4% |
Wisconsin | 4 | 11,855,439 | 0.7 | 100.0% | 3.23x | 13.1% | 58.4% | 58.4% |
Indiana | 3 | 10,331,061 | 0.6 | 99.6% | 3.17x | 11.4% | 58.9% | 58.9% |
Missouri | 2 | 7,612,423 | 0.4 | 97.7% | 3.01x | 9.7% | 58.1% | 58.1% |
Tennessee | 2 | 7,428,140 | 0.4 | 97.0% | 2.37x | 10.0% | 62.6% | 62.6% |
Kentucky | 1 | 5,241,400 | 0.3 | 89.2% | 3.13x | 9.8% | 59.7% | 59.7% |
Alabama | 1 | 1,827,826 | 0.1 | 100.0% | 3.25x | 13.2% | 58.5% | 58.5% |
Oklahoma | 2 | 1,594,186 | 0.1 | 100.0% | 2.68x | 9.6% | 53.9% | 53.9% |
Kansas | 1 | 1,037,791 | 0.1 | 100.0% | 2.68x | 9.6% | 53.9% | 53.9% |
Arkansas | 2 | 959,302 | 0.1 | 100.0% | 2.68x | 9.6% | 53.9% | 53.9% |
Louisiana | 2 | 715,116 | 0.0 | 100.0% | 2.68x | 9.6% | 53.9% | 53.9% |
Total / Weighted Average: | 171 | $1,774,834,674 | 100.0% | 91.6%(5) | 3.03x | 11.5% | 55.4% | 54.4% |
(1) | Because this table presents information relating to the mortgaged properties and not mortgage loans, the information for mortgage loans secured by more than one mortgaged property is based on allocated loan amounts. |
(2) | In the case of Loan Nos. 1, 2, 3, 4, 7, 8, 10, 11, 12, 13, 17, 19, 20, 21, 23, 25, 27 and 28, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 4, 5, 10, 18 and 23, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s), related mezzanine loan(s) and/or related additional secured subordinate debt. |
(3) | In the case of Loan Nos. 1, 4, 8 and 22, Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details. |
(4) | In the case of Loan Nos. 4, 5 and 12, each with an anticipated repayment date, Maturity Date LTV is calculated as of the related anticipated repayment date. |
(5) | Excludes occupancy for five properties in connection with Loan No. 2 as the collateral consists of parking garages with no attributable occupancy. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
8 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Collateral Characteristics |
Cut-off Date Principal Balance |
Weighted Average | |||||||||||
Range of Cut-off Date Principal Balances | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) | ||
$2,275,000 | - | $9,999,999 | 10 | $69,073,224 | 3.9% | 4.00504% | 102 | 2.34x | 11.1% | 59.6% | 56.9% |
$10,000,000 | - | $19,999,999 | 8 | 112,665,916 | 6.3 | 3.67491% | 119 | 2.45x | 10.5% | 62.0% | 58.9% |
$20,000,000 | - | $29,999,999 | 8 | 193,762,534 | 10.9 | 3.56866% | 116 | 2.56x | 10.4% | 60.0% | 57.5% |
$30,000,000 | - | $49,999,999 | 8 | 303,708,000 | 17.1 | 3.56079% | 91 | 2.68x | 10.4% | 62.0% | 61.0% |
$50,000,000 | - | $125,000,000 | 13 | 1,095,625,000 | 61.7 | 3.48240% | 94 | 3.31x | 12.2% | 51.8% | 51.4% |
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% | ||
Mortgage Interest Rates |
Weighted Average | |||||||||||
Range of Mortgage Interest Rates | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) | ||
2.77600% | - | 3.00000% | 7 | $435,818,000 | 24.6% | 2.85118% | 101 | 3.86x | 11.3% | 44.3% | 44.3% |
3.00001% | - | 3.50000% | 9 | 456,577,500 | 25.7 | 3.32050% | 93 | 3.30x | 11.4% | 55.6% | 55.4% |
3.50001% | - | 4.00000% | 24 | 627,487,473 | 35.4 | 3.77242% | 105 | 2.56x | 11.0% | 62.3% | 60.6% |
4.00001% | - | 5.13500% | 7 | 254,951,701 | 14.4 | 4.52315% | 81 | 2.28x | 13.2% | 56.9% | 54.9% |
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% |
Original Term to Maturity in Months |
Weighted Average | |||||||||
Original Term to Maturity in Months | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) |
60 | 9 | $449,809,935 | 25.3% | 3.85901% | 59 | 3.10x | 13.0% | 54.5% | 54.3% |
84 | 4 | 202,809,766 | 11.4 | 3.66049% | 83 | 3.33x | 13.2% | 59.0% | 58.7% |
86 | 1 | 65,000,000 | 3.7 | 2.95200% | 84 | 4.11x | 12.6% | 36.5% | 36.5% |
96 | 1 | 22,262,500 | 1.3 | 3.42100% | 95 | 2.74x | 9.6% | 64.8% | 64.8% |
120 | 32 | 1,034,952,473 | 58.3 | 3.41344% | 119 | 2.88x | 10.5% | 56.1% | 54.5% |
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% |
Remaining Term to Maturity in Months(1) |
Weighted Average | |||||||||||
Range of Remaining Term to Maturity in Months | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) | ||
57 | - | 60 | 9 | $449,809,935 | 25.3% | 3.85901% | 59 | 3.10x | 13.0% | 54.5% | 54.3% |
61 | - | 84 | 5 | 267,809,766 | 15.1 | 3.48853% | 83 | 3.52x | 13.0% | 53.5% | 53.3% |
85 | - | 119 | 32 | 1,049,164,973 | 59.1 | 3.41010% | 118 | 2.88x | 10.5% | 56.3% | 54.7% |
120 | - | 120 | 1 | 8,050,000 | 0.5 | 3.87000% | 120 | 2.08x | 8.5% | 54.0% | 54.0% |
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% |
(1) | In the case of Loan Nos. 4, 5 and 12, each with an anticipated repayment date, Remaining Loan Term and Maturity Date LTV are calculated as of the related anticipated repayment date. |
(2) | In the case of Loan Nos. 1, 2, 3, 4, 7, 8, 10, 11, 12, 13, 17, 19, 20, 21, 23, 25, 27 and 28, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 4, 5, 10, 18 and 23, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s), related mezzanine loan(s) and/or related additional secured subordinate debt. |
(3) | In the case of Loan Nos. Nos. 1, 4, 8 and 22, Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
9 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Collateral Characteristics |
Original Amortization Term in Months |
Weighted Average | |||||||||||||
Original Amortization Term in Months | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) | ||||
Interest Only | 38 | $1,566,005,500 | 88.2% | 3.48109% | 95 | 3.22x | 11.8% | 54.2% | 54.2% | ||||
360 | - | 360 | 9 | 208,829,174 | 11.8 | 3.96298% | 115 | 1.60x | 9.9% | 64.2% | 55.9% | ||
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% | ||||
Remaining Amortization Term in Months |
Weighted Average | |||||||||||||
Range of Remaining Amortization Term in Months | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) | ||||
Interest Only | 38 | $1,566,005,500 | 88.2% | 3.48109% | 95 | 3.22x | 11.8% | 54.2% | 54.2% | ||||
359 | - | 360 | 9 | 208,829,174 | 11.8 | 3.96298% | 115 | 1.60x | 9.9% | 64.2% | 55.9% | ||
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% | ||||
Amortization Types |
Weighted Average | |||||||||
Amortization Types | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) |
Interest Only | 35 | $1,315,005,500 | 74.1% | 3.61162% | 94 | 3.12x | 11.9% | 56.2% | 56.2% |
Interest Only - ARD | 3 | 251,000,000 | 14.1 | 2.79726% | 103 | 3.76x | 10.7% | 43.6% | 43.6% |
Interest Only, Amortizing Balloon | 4 | 146,152,500 | 8.2 | 3.93820% | 119 | 1.53x | 9.4% | 63.5% | 56.8% |
Amortizing Balloon | 5 | 62,676,674 | 3.5 | 4.02076% | 107 | 1.77x | 11.1% | 65.9% | 53.9% |
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% |
Underwritten Net Cash Flow Debt Service Coverage Ratios(2)(3) |
Weighted Average | |||||||||||
Range of Underwritten Net Cash Flow Debt Service Coverage Ratios | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) | ||
1.42x | - | 1.79x | 7 | $194,735,885 | 11.0% | 3.91999% | 116 | 1.56x | 9.5% | 64.1% | 56.0% |
1.80x | - | 2.09x | 6 | 122,396,523 | 6.9 | 4.19638% | 82 | 1.98x | 9.2% | 65.2% | 64.5% |
2.10x | - | 2.29x | 2 | 50,870,000 | 2.9 | 3.87749% | 118 | 2.27x | 9.3% | 62.1% | 62.1% |
2.30x | - | 2.59x | 8 | 150,041,766 | 8.5 | 3.82874% | 98 | 2.40x | 10.0% | 62.8% | 62.4% |
2.60x | 2.99x | 8 | 261,007,500 | 14.7 | 3.56319% | 103 | 2.88x | 11.0% | 61.3% | 61.3% | |
3.00x | - | 4.50x | 16 | 995,783,000 | 56.1 | 3.31425% | 94 | 3.62x | 12.7% | 49.5% | 49.5% |
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% |
(1) | In the case of Loan Nos. 4, 5 and 12, each with an anticipated repayment date, Remaining Loan Term and Maturity Date LTV are calculated as of the related anticipated repayment date. |
(2) | In the case of Loan Nos. 1, 2, 3, 4, 7, 8, 10, 11, 12, 13, 17, 19, 20, 21, 23, 25, 27 and 28, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 4, 5, 10, 18 and 23, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s), related mezzanine loan(s) and/or related additional secured subordinate debt. |
(3) | In the case of Loan Nos. Nos. 1, 4, 8 and 22, Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
10 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Collateral Characteristics |
LTV Ratios as of the Cut-off Date(2)(3) |
Weighted Average | |||||||||||
Range of Cut-off Date LTVs | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) | ||
29.3% | - | 39.9% | 3 | $161,000,000 | 9.1% | 2.87031% | 105 | 4.28x | 12.6% | 33.9% | 33.9% |
40.0% | - | 49.9% | 5 | 381,000,000 | 21.5 | 3.46932% | 87 | 3.78x | 14.1% | 43.2% | 43.2% |
50.0% | - | 59.9% | 12 | 540,138,000 | 30.4 | 3.55425% | 103 | 2.90x | 11.1% | 58.5% | 57.8% |
60.0% | - | 69.2% | 27 | 692,696,674 | 39.0 | 3.71775% | 98 | 2.42x | 10.2% | 64.6% | 62.7% |
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% |
LTV Ratios as of the Maturity Date(1)(2)(3) |
Weighted Average | |||||||||||
Range of Maturity Date LTVs | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) | ||
29.3% | - | 39.9% | 3 | $161,000,000 | 9.1% | 2.87031% | 105 | 4.28x | 12.6% | 33.9% | 33.9% |
40.0% | - | 44.9% | 4 | 326,000,000 | 18.4 | 3.55863% | 82 | 3.77x | 14.5% | 42.3% | 42.3% |
45.0% | - | 49.9% | 1 | 55,000,000 | 3.1 | 2.94000% | 119 | 3.86x | 12.0% | 48.1% | 48.1% |
50.0% | - | 54.9% | 7 | 165,594,973 | 9.3 | 3.93171% | 108 | 1.97x | 10.0% | 59.1% | 52.8% |
55.0% | - | 68.0% | 32 | 1,067,239,701 | 60.1 | 3.60180% | 99 | 2.73x | 10.7% | 62.4% | 61.8% |
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% |
Prepayment Protection |
Weighted Average | |||||||||
Prepayment Protection | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) |
Defeasance | 40 | $1,423,513,151 | 80.2% | 3.58702% | 98 | 2.94x | 11.5% | 56.6% | 55.5% |
Yield Maintenance or Defeasance | 5 | 219,151,523 | 12.3 | 3.07240% | 107 | 3.44x | 10.9% | 44.8% | 44.4% |
Yield Maintenance | 2 | 132,170,000 | 7.4 | 3.77919% | 82 | 3.25x | 13.4% | 59.6% | 59.6% |
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% |
Loan Purpose |
Weighted Average | |||||||||
Loan Purpose | Number of Loans | Cut-off Date Principal Balance | % of IPB | Mortgage Rate | Remaining Loan Term(1) | UW NCF DSCR(2)(3) | UW NOI DY(2) | Cut-off Date LTV(2)(3) | Maturity Date LTV (1)(2)(3) |
Refinance | 19 | $872,817,235 | 49.2% | 3.43964% | 90 | 3.42x | 12.6% | 49.4% | 48.6% |
Acquisition | 24 | 730,117,439 | 41.1 | 3.63881% | 105 | 2.65x | 10.5% | 62.6% | 61.8% |
Recapitalization | 4 | 171,900,000 | 9.7 | 3.60710% | 108 | 2.66x | 10.6% | 54.8% | 52.5% |
Total / Wtd. Avg: | 47 | $1,774,834,674 | 100.0% | 3.53779% | 98 | 3.03x | 11.5% | 55.4% | 54.4% |
(1) | In the case of Loan Nos. 4, 5 and 12, each with an anticipated repayment date, Remaining Loan Term and Maturity Date LTV are calculated as of the related anticipated repayment date. |
(2) | In the case of Loan Nos. 1, 2, 3, 4, 7, 8, 10, 11, 12, 13, 17, 19, 20, 21, 23, 25, 27 and 28, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations include the related Pari Passu Companion Loan(s). In the case of Loan Nos. 1, 4, 5, 10, 18 and 23, UW NCF DSCR, UW NOI DY, Cut-off Date LTV and Maturity Date LTV calculations exclude the related Subordinate Companion Loan(s), related mezzanine loan(s) and/or related additional secured subordinate debt. |
(3) | In the case of Loan Nos. Nos. 1, 4, 8 and 22, Cut-off Date LTV and the Maturity Date LTV are calculated by using an appraised value based on certain hypothetical assumptions. Refer to “Description of the Mortgage Pool—Assessments of Property Value and Condition” and “—Appraised Value” in the Preliminary Prospectus for additional details. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
11 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Collateral Characteristics |
Previous Securitization History(1) |
No. | Mortgaged Property | Cut-off Date Principal Balance(2) | % of IPB | Location | Property Type | Previous Securitization |
1 | Old Chicago Post Office | $125,000,000 | 7.0% | Chicago, IL | Office | BXMT 2021-FL4, BXMT 2020-FL3, BXMT 2020-FL2 |
2.01 | Bedrock Portfolio - First National Building | $28,820,000 | 1.6% | Detroit, MI | Office | JPMBB 2015-C32, JPMCC 2015-JP1 |
2.03 | Bedrock Portfolio - Chrysler House | $14,325,000 | 0.8% | Detroit, MI | Office | WFRBS 2013-C16 |
2.04 | Bedrock Portfolio - 1001 Woodward | $14,232,500 | 0.8% | Detroit, MI | Office | JPMBB 2014-C19 |
2.05 | Bedrock Portfolio - One Woodward | $10,317,500 | 0.6% | Detroit, MI | Office | COMM 2014-UBS6 |
5 | One Wilshire | $90,000,000 | 5.1% | Los Angeles, CA | Office | COMM 2013-CR10 |
7 | JW Marriott Desert Springs | $75,000,000 | 4.2% | Palm Desert, CA | Hospitality | BACM 2017-BNK3, BANK 2017-BNK4 |
12 | Novo Nordisk HQ | $60,000,000 | 3.4% | Plainsboro, NJ | Office | WFCM 2016-NXS6, CSMC 2016-NXSR, CGCMT 2017-P7 |
13 | The Kirby Collection | $55,000,000 | 3.1% | Houston, TX | Mixed Use | TRTX 2018-FL2 |
18 | The Onyx | $38,000,000 | 2.1% | Houston, TX | Multifamily | RAITF 2017-FL8 |
19.11 | ExchangeRight Net Leased Portfolio #53 - Walgreens - Watervliet (2nd), NY | $969,767 | 0.1% | Watervliet, NY | Retail | COMM 2013-LC13 |
20.01 | Glen Forest Office Portfolio - Hillcrest | $5,702,338 | 0.3% | Richmond, VA | Office | BCORE 2019-CORE |
20.02 | Glen Forest Office Portfolio - Arrington | $5,360,198 | 0.3% | Richmond, VA | Office | BCORE 2019-CORE |
20.03 | Glen Forest Office Portfolio - Highland II | $3,729,329 | 0.2% | Richmond, VA | Office | BCORE 2019-CORE |
20.04 | Glen Forest Office Portfolio - Meridian | $3,506,938 | 0.2% | Richmond, VA | Office | BCORE 2019-CORE |
20.05 | Glen Forest Office Portfolio - Bayberry | $2,452,005 | 0.1% | Richmond, VA | Office | BCORE 2019-CORE |
20.06 | Glen Forest Office Portfolio - Highland I | $2,278,084 | 0.1% | Richmond, VA | Office | BCORE 2019-CORE |
20.07 | Glen Forest Office Portfolio - Capstone | $2,155,484 | 0.1% | Richmond, VA | Office | BCORE 2019-CORE |
20.08 | Glen Forest Office Portfolio - Forest Plaza I | $1,767,725 | 0.1% | Richmond, VA | Office | BCORE 2019-CORE |
20.09 | Glen Forest Office Portfolio - Forest Plaza II | $1,482,608 | 0.1% | Richmond, VA | Office | BCORE 2019-CORE |
25.01 | Nyberg Portfolio - Nyberg Rivers | $12,522,254 | 0.7% | Tualatin, OR | Retail | COMM 2015-LC21 |
25.02 | Nyberg Portfolio - Nyberg Woods | $11,377,746 | 0.6% | Tualatin, OR | Retail | COMM 2015-LC21 |
43 | Lakeville Townhomes | $7,170,000 | 0.4% | Memphis, TN | Multifamily | BANC 2019-CRE5 |
(1) | The table above represents the properties for which the previously existing debt was securitized, based on information provided by the related borrower or obtained through searches of a third-party database. |
(2) | Cut-off Date Principal Balance represents the allocated loan amount for each respective mortgaged property. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
12 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
13 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
14 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
15 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
Mortgage Loan Information | Property Information | |||
Mortgage Loan Seller: | JPMCB | Single Asset / Portfolio: | Single Asset | |
Original Principal Balance(1): | $125,000,000 | Title: | Fee | |
Cut-off Date Principal Balance(1): | $125,000,000 | Property Type – Subtype: | Office – CBD | |
% of Pool by IPB: | 7.0% | Net Rentable Area (SF): | 2,331,477 | |
Loan Purpose: | Refinance | Location: | Chicago, IL | |
Borrower: | 601W Companies Chicago LLC | Year Built / Renovated: | 1916 / 2016-2021 | |
Guarantors: | Mark Karasick and | Occupancy: | 91.8% | |
Michael Silberberg | Occupancy Date: | 12/1/2021 | ||
Interest Rate: | 3.46957% | Fourth Most Recent NOI(4): | NAV | |
Note Date: | 12/9/2021 | Third Most Recent NOI(4): | NAV | |
Maturity/ARD Date: | 1/1/2027 | Second Most Recent NOI(4): | NAV | |
Interest-only Period: | 60 months | Most Recent NOI(4): | NAV | |
Original Term: | 60 months | UW Economic Occupancy: | 91.6% | |
Original Amortization: | None | UW Revenues: | $115,801,966 | |
Amortization Type: | Interest Only | UW Expenses: | $39,254,351 | |
Call Protection: | L(25),D(31),O(4) | UW NOI: | $76,547,615 | |
Lockbox / Cash Management: | Hard / In Place | UW NCF: | $76,080,387 | |
Additional Debt(1): | Yes | Appraised Value / Per SF(5): | $1,189,500,000 / $510 | |
Additional Debt Balance(1): | $387,800,000 / $317,200,000 / | Appraisal Date(5): | 5/7/2021 | |
$125,000,000 | ||||
Additional Debt Type(1)(2): | Pari Passu / Subordinate / | |||
Mezzanine | ||||
Escrows and Reserves(3) | Financial Information(1)(2) | |||||||
Initial | Monthly | Initial Cap | Senior Notes | Whole Loan | Total Debt | |||
Taxes: | $2,343,888 | $1,171,944 | N/A | Cut-off Date Loan / SF: | $220 | $356 | $410 | |
Insurance: | $302,576 | $302,576 | N/A | Maturity Date Loan / SF: | $220 | $356 | $410 | |
Replacement Reserves: | $0 | $48,572 | $1,165,739 | Cut-off Date LTV: | 43.1% | 69.8% | 80.3% | |
TI/LC: | $0 | Springing | N/A | Maturity Date LTV: | 43.1% | 69.8% | 80.3% | |
Other: | $118,572,762 | $0 | N/A | UW NCF DSCR: | 4.22x | 2.61x | 1.90x | |
UW NOI Debt Yield: | 14.9% | 9.2% | 8.0% | |||||
Sources and Uses(1)(2) | ||||||||
Sources | Proceeds | % of Total | Uses | Proceeds | % of Total | |||
Mortgage Loan | $512,800,000 | 52.8% | Existing Loan Paydown | $835,582,814 | 86.1% | |||
Sponsor Equity | 15,425,825 | 1.6% | Outstanding TILC Reserve | 50,942,055 | 5.2% | |||
Sub-Debt | 442,200,000 | 45.6% | Rent Abatement Reserve | 47,960,429 | 4.9% | |||
Gap Rent Reserve | 11,492,939 | 1.2% | ||||||
HTC Put Reserve | 4,265,829 | 0.4% | ||||||
Remaining Hard Costs Reserve | 3,911,510 | 0.4% | ||||||
Taxes and Insurance Reserve | 2,646,463 | 0.3% | ||||||
Closing Costs | 13,623,786 | 1.4% | ||||||
Total Sources | $970,425,825 | 100.0% | Total Uses | $970,425,825 | 100.0% | |||
(1) | The Old Chicago Post Office Whole Loan is comprised of (i) the Old Chicago Post Office Mortgage Loan (comprised of two senior notes with an outstanding principal balance as of the Cut-off Date of $125.0 million, (ii) a companion loan, which is pari passu with the Old Chicago Post Office Mortgage Loan, (comprised of five pari passu notes) with an aggregate outstanding principal balance as of the Cut-off Date of $387.8 million and (iii) a subordinate companion loan with an outstanding principal balance as of the Cut-off Date of $317.2 million. The Senior Notes Financial Information presented in the chart above reflects the $512.8 million aggregate Cut-off Date balance of the Old Chicago Post Office Mortgage Loan and the Old Chicago Post Office Companion Loan, excluding the Old Chicago Post Office Subordinate Companion Loan and the Old Chicago Post Office Mezzanine Loan. The Whole Loan Financial Information presented in the chart above reflects the Cut-Off Date balance of the $830.0 million aggregate Cut-off Date balance of the Old Chicago Post Office Senior Notes and the Old Chicago Post Office Subordinate Companion Loan, and excludes the related Old Chicago Post Office Mezzanine Loan. The Total Debt Financial Information presented in the chart above reflects the $955.0 million aggregate Cut-off Date balance Old Chicago Post Office Whole Loan and the Old Chicago Post Office Mezzanine Loan. |
(2) | See “Current Mezzanine or Secured Subordinate Indebtedness” herein. |
(3) | For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below. |
(4) | Historical financials are not available as the property is newly redeveloped. Redevelopment began in 2016 and as of the Cut-off Date construction is substantially complete. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
16 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
(5) | Based on the “Hypothetical Market Value Assuming Reserves”, which assumes an upfront escrow is established for all remaining costs to complete, gap rent, outstanding leasing costs and outstanding rent abatements. At origination, the borrowers reserved $59,453,368 for outstanding gap rent and free rent and approximately $50,942,055 for all outstanding tenant improvements and leasing commissions. Based on the “As-Is” appraised value as of May 7, 2021 equal to $1,019,500,000, the Old Chicago Post Office Senior Notes Cut-off Date LTV and the Old Chicago Post Office Senior Notes Maturity Date LTV are 50.3%. The appraisal also assumes the Old Chicago Post Office Property has attained the Class L tax abatement as described further in “Class L Tax Abatement” herein. |
The Loan. The Old Chicago Post Office mortgage loan is secured by a first mortgage lien on the borrower’s fee simple interest in a 12-story 2,331,477 square foot, newly renovated, Class A multi-tenant office building located in downtown Chicago, Illinois (the “Old Chicago Post Office Property”) and, due to historic tax credits associated with the redevelopment, a pledge of interest in the Master Lessee (as defined below) by the Managing Member of the Master Lessee (as defined below) to the lender. The Old Chicago Post Office loan is part of a whole loan, which has an aggregate outstanding balance as of the Cut-off Date of $830.0 million (the “Old Chicago Post Office Whole Loan”) and is comprised of (i) seven pari passu senior notes with an aggregate initial principal balance of $512.8 million (collectively the “Old Chicago Post Office Senior Notes”) and (ii) one junior note, with an initial principal balance of $317.2 million (the “Old Chicago Post Office Subordinate Companion Loan”). Among the Old Chicago Post Office Senior Notes are the non-controlling Notes A-5 and A-6, with an aggregate initial principal balance of $125.0 million, which will be contributed to the BMARK 2022-B32 trust (the “Old Chicago Post Office Mortgage Loan”). The remaining $387.8 million of Old Chicago Post Office Senior Notes (the “Old Chicago Post Office Companion Notes” or the “Old Chicago Post Office Companion Loan”) and the Junior Note will not be part of the assets backing the Certificates. The relationship between the holders of the Old Chicago Post Office Whole Loan is governed by a co-lender agreement as described under “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced AB Whole Loans—The Old Chicago Post Office Whole Loan” in the Preliminary Prospectus.
Whole Loan Summary | ||||
Note | Original Balance | Cut-off Date Balance | Note Holder | Controlling Piece |
A-1, A-2, A-3, A-4, A-7 | $387,800,000 | $387,800,000 | JPMCC 2022-OPO | Yes |
A-5, A-6 | $125,00,000 | $125,00,000 | Benchmark 2022-B32 | No |
Total Senior Notes | $512,800,000 | $512,800,000 | ||
B-1 | $317,200,000 | $317,200,000 | JPMCC 2022-OPO | No |
Whole Loan | $830,000,000 | $830,000,000 |
Whole Loan Summary(1) |
Non-Trust A Notes $387,800,000 Old Chicago Post Office Companion Notes JPMCC 2022-OPO Note A-1, A-2, A-3, A-4, A-7 | Trust A Notes $125,000,000 Old Chicago Post Office Mortgage Loan Note A-5, A-6 |
Non-Trust B Note $317,200,000 Old Chicago Post Office Subordinate Companion Loan JPMCC 2022-OPO Notes B-1 |
(1) | The Old Chicago Post Office Subordinate Note will be subordinate in right of payment to the Old Chicago Post Office Senior Notes. |
The Borrower. The borrower of the Old Chicago Post Office Whole Loan is 601W Companies Chicago LLC (the “Borrower”), a Delaware limited liability company and single purpose entity with two independent managers in its organizational structure. Legal counsel to the Borrowers delivered a non-consolidation opinion in connection with the origination of the Old Chicago Post Office Whole Loan. Additionally, the ownership interest of the Managing Member of the Master Lessee, which is owned and controlled by an affiliate of the Borrower, has been pledged as collateral for the Old Chicago Post Office Whole Loan. See “Historic Tax Credits” and “Master Lease” herein.
The Loan Sponsors. The loan sponsors and non-recourse carveout guarantors are Mark Karasick and Michael Silberberg (collectively, the “Loan Sponsor”). Mark Karasick is a senior member of 601W Companies, a New York City based private real estate acquisition, ownership, development and management company with experience in major markets throughout the United States. Over the past 25 years, 601W Companies has acquired a number of substantial and well known commercial properties throughout the country, aggregating approximately 21.0 million square feet with a collective value in excess of $7.0 billion. 601W Companies’ investment profile focuses on core plus assets with an opportunity to significantly appreciate, thus yielding income growth and enhanced returns. Michael Silberberg has acted as both sole managing member and as co-managing member in a significant number of 601W Companies’ transactions. Mark Karasick leads the 601W Companies team in the acquisition, development, leasing and management of its 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.
17 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
The Property. The Old Chicago Post Office Property is a Class A, 12-story, 2,331,477 square foot, office building in downtown Chicago, Illinois. Spanning two entire city blocks bound by Van Buren Street, Harrison Street, Canal Street and the Chicago River, the Old Chicago Post Office Property is one of the most recognizable buildings in the city. Constructed in 1916 as a mail terminal building and post office, the Old Chicago Post Office Property is located in the West Loop submarket in the epicenter of the city. In 1997, the Post Office vacated the property in favor of a new facility with more enhanced features and technology, at which point the property remained vacant for nearly two decades The Borrower acquired the property in 2016 and implemented an approximately $1.26 billion redevelopment plan over a four year period to reposition the property as a modern business and commerce hub. The newly redeveloped Old Chicago Post Office Property is comprised of a wide array of state of the art and unique amenities including a 3.5 acre roof deck that spans the entirety of the building and features a basketball court, a bistro and bar area and athletic track. Additional amenities include an onsite food hall, an 11,792 square foot lounge, a 2,824 square foot library, event space, a 27,176 square foot luxury fitness center, versatile conference center space and a fully restored landmarked lobby, which also functions as event space. The Loan Sponsor has applied for, and expects to receive a Class L Reduction (as defined below) which is ultimately passed through to tenants via the NNN lease structure. According to the Loan Sponsor, as a result of such tax savings, in-place rents at the Old Chicago Post Office Property are expected to be significantly more attractive to tenants, as gross occupancy cost is expected to be significantly reduced. The Loan Sponsor expects that the Class L tax abatements will present an advantageous position for the Loan Sponsor to maintain market level NNN rents, as tenants benefit from reduced gross rents.
As of December 1, 2021, the Old Chicago Post Office Property was 91.8% occupied by 25 tenants, comprised largely of institutional quality tenants and investment rated tenants. Approximately 40.3% of net rentable area and 45.1% of underwritten rent are attributable to investment grade rated tenants. The Old Chicago Post Office Property benefits from a unique tenant roster with office users predominately represented by the technology sector. The Property benefits from long-term tenancy with no major tenant rolling during the term of the Whole Loan and a weighted average remaining lease term of approximately 9.42 years as of the Cut-off Date. Approximately 0.2% of net rentable area is attributable to tenants with maturity dates expiring during the term of the Whole Loan.
The largest tenant, Uber (NYSE: UBER) (Moody’s/S&P/Fitch: B2/B/NR; 368,179 square feet; 15.8% of net rentable area; 17.2% of underwritten base rent), is an American multinational ride-hailing company offering services that include peer-to-peer ridesharing, ride hailing, food delivery and freight transportation. The company was launched in 2010 and is currently headquartered in San Francisco, California. The Old Chicago Post Office Property serves as the headquarters for Uber Freight, Uber’s logistics arm. Uber Freight is a logistics platform built on the power of Uber with the goal to reshape global logistics and deliver reliability, flexibility and transparency for shippers and carriers. Since launching in 2017, Uber Freight has built one of the world’s largest digitally-enabled carrier networks and transformed entrenched practices around pricing and booking freight to reduce inefficiencies and increase opportunities for business growth and industry collaboration. Today, the business counts over 70,000 carriers in its network and thousands of shippers as customers, from small businesses to Fortune 500 companies. Uber is listed on the NYSE and has a market cap of approximately $84.49 billion as of January 12, 2022. Uber has a one-time option to surrender not less than 35,000 square feet nor more than 45,000 square feet on one full floor in the north building or on the southernmost end of the portion of the premises on any floor in the south building as selected by Uber, effective as of December 31, 2025. If Uber exercises such surrender option, it is required to pay the sum of (i) unamortized portion of leasing costs provided by landlord for each portion of contracted space with such costs amortized with 8% interest per annum over the initial term plus (ii) three months of the recurring rent for contracted space as of the contraction date. In addition, Uber has two, five-year renewal options upon providing 18 months’ notice prior to lease expiration.
The second largest tenant, Walgreens (Moody’s/S&P/Fitch: Baa2/BBB/BBB-; 219,698 square feet; 9.4% of net rentable area; 9.6% of underwritten base rent), utilizes the Old Chicago Post Office Property as the company’s downtown office. The company hosts digital and IT operations employees as well as some Walgreens Boots Alliance global IT personnel in the new space. Walgreens is one of the largest drugstore chains in the US, operating over 9,000 mostly freestanding Walgreens stores in all 50 US states, the District of Columbia, the Virgin Islands, and Puerto Rico. Walgreens has over 225,000 employees including 85,000 healthcare service providers, including pharmacists, pharmacy technicians, nurse practitioners and other health-related professionals. Walgreens is the US subsidiary and leading brand of Walgreens Boots Alliance, a pharmacy retailer with more than 18,750 stores in about a dozen countries. The company was founded in 1901 and is headquartered in Deerfield, IL. Walgreens Boots Alliance, Inc. is listed on the NASDAQ and has a market cap of approximately $47.2 billion as of January 12, 2022. Walgreens has a one-time option to surrender 38,000 to 42,000 square feet on the east portion of the 4th floor or the east portion of the 5th floor of the premises, as selected by Walgreens upon the day immediately preceding the 8th year anniversary of the lease commencement date. The contraction fee will equal the sum of the contraction share of the landlord’s unamortized costs utilizing a 7.5% interest rate per annum plus three months of the recurring rent for the contraction portion. In addition, Walgreens has two renewal options for consecutive periods of either a five-year or 10 years with written notice between 15-24 months’ notice prior to expiration.
The third largest tenant, PepsiCo (NASDAQ: PEP) (Moody’s/S&P/Fitch: A1/A+/NR; 193,420 square feet; 8.3% of net rentable area; 9.7% of underwritten base rent), is a multi-national food and beverage company. The Old Chicago Post Office Property houses the company’s Gatorade, Quaker and Tropicana brands, and its North America Central Division. PepsiCo is one of the largest food and beverage companies globally. It makes, markets, and sells 23 brands across the beverage and snack categories, including Pepsi, Mountain Dew, Gatorade, Doritos, Lays, and Ruffles. The company’s headquarters are in Purchase, New York. PepsiCo is listed on the NASDAQ and has a market cap of approximately $240.7 billion as of January 12, 2022. PepsiCo has the option to reduce the square footage of its
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
premises by 22,367 square feet located in the East Building from the premises on December 31, 2025. The contraction fee payable is the sum of two months recurring rent payable for contraction premises and the unamortized portion of rent with interest of 8% per annum over the term. In addition, PepsiCo has two, five-year renewal options upon providing 14-20 months’ notice prior to lease expiration.
COVID-19 Update. As of January 1, 2021, the Old Chicago Post Office Whole Loan is not subject to any modification or forbearance requests. No tenants are currently subject to rent abatements in connection with COVID-19. See “Risk Factors—Special Risks—Coronavirus Pandemic Has Adversely Affected the Global Economy and Will Likely Adversely Affect the Performance of the Mortgage Loans” in the Preliminary Prospectus.
The Market. The Old Chicago Post Office Property spans two entire city blocks bound by Van Buren Street, Harrison Street, Canal Street and the Chicago River and is a part of the West Loop submarket within the Chicago-Naperville-Elgin metropolitan statistical area (“MSA”). According to the appraisal, Chicago has been ranked as the top metropolitan area in the nation for corporate relocation and expansion as companies seek to tap the city’s deep talent pool, efficient transportation system and rich amenities base. An extensive urban infrastructure with a highly efficient distribution system linking suppliers and customers further supports Chicago’s position as one of the nation’s most important business centers. It thus attracts some of the largest and most respected companies in the world, including the headquarters for McDonald’s, Boeing and more.
The Old Chicago Post Office is located in the West Loop submarket of Chicago. The West Loop is the metro’s largest office submarket in terms of inventory, containing approximately 60.7 million square feet of space and commanding some of the highest rents in the metro area. The West Loop, bound by Grand Ave to the north, I-290 to the south, the Chicago River to the east and Ashland Ave to the west, is considered to be one of Chicago’s most attractive neighborhoods. The submarket is known for the areas old industrial stock, lower density of real estate square footage in comparison to downtown Chicago neighborhoods, the presence of many highly rated restaurants and its proximity to the downtown Chicago and the University of Illinois at Chicago.
According to the appraisal, as of year-end 2020, all classes of office space in the West Loop submarket had inventory of approximately 60.7 million square feet with a market vacancy of 13.2% and overall asking rents of $42.99 per square foot on a gross basis, while the overall Central Business District (the “CBD”) had a vacancy of 13.3% and asking rents of $24.79 per square foot. In recent years, the submarket has benefitted from the influx of technology, advertising, media and information companies. Many large corporations, including 16 Fortune 500 companies, are headquartered in Chicago. Furthermore, the MSA employment base is comprised of more than 4.4 million employees. Due to Chicago’s talented labor pool, numerous companies have relocated to more than 9.1 million square feet in downtown Chicago since 2008. The majority of migrations relocate to the West Loop out of all Chicago CBD submarkets. Notable companies that have relocated offices to the downtown Chicago office market include McDonald’s, Echo, Allstate, Walgreens, Motorola Solutions, Treehouse Foods, Ferrara Candy, Mondelez International and Kraft Heinz.
The appraisal identified 10 comparable NNN office leases with in-place rents ranging from $25.00 to $37.00 per square foot with a weighted average in-place rent of approximately $34.00 per square foot.
Office Lease Comparables(1) | ||||||||
Property | Class | Year Built / Renovated | Tenant | NRA (SF) | Rent Per SF | Term (Mos.) | ||
Old Chicago Post Office | A | 1916 / 2016 - 2021 | 2,331,477 | $32.08(2) | 11.1 | |||
Citadel Center | A | 2003 / NAP | 1,504,364 | |||||
Donohue Brown | 21,489 | $25.00 | 11.0 | |||||
167 N Green Street | A | 2020 / NAP | 635,000 | |||||
CCC Information Services | 140,565 | $37.00 | 15.0 | |||||
Foxtrot Market | 30,000 | $27.00 | 12.0 | |||||
BMO Tower Chicago | A | 2022 / NAP | 1,463,000 | |||||
BMO Financial Group | 493,000 | $35.00 | NAV | |||||
Chapman & Cutler LLP | 88,020 | $36.00 | 12.0 | |||||
333 North Green Street | A | 2019 / NAP | 553,412 | |||||
Ernst & Young | 39,203 | $35.50 | 12.0 | |||||
Willis Tower | A | 1973 / 2020 | 3,810,000 | |||||
Vi Senior Living | 30,405 | $33.50 | 11.0 | |||||
600 West Chicago | B | 1908 / 2001 & 2016 | 1,617,630 | |||||
Barry Callebaut | 60,000 | $27.00 | 12.0 | |||||
24 East Washington Street | A | 1909 / 2020 | 672,590 | |||||
Vivid Seats | 110,000 | $32.00 | 12.0 | |||||
210 North Carpenter Street | A | 2018 / NAP | 205,630 | |||||
132,205 | $33.27 | 15.0 | ||||||
Total / Wtd. Avg | 1,144,887 | $34.00 | ||||||
(1) | Source: Appraisal. |
(2) | Based on the underwritten rent roll dated December 1, 2021. Rent PSF for the Old Chicago Post Office Property is solely based on the office tenants. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
Market Rent Conclusion(1) | |||||
Office | First Floor Retail | Food Hall | Storage | Management | |
Market Rent | $30.50 | $35.00 | $20.00 | $22.50 | $0.00 |
Lease Term (months) | 120 | 120 | 120 | 120 | 180 |
Lease Type (reimbursements) | NNN | NNN | NNN | Gross | Gross |
(1) | Source: Appraisal. |
Historical Occupancy(1) | |||
2019 | 2020 | 2021 | Current(2) |
N/A | N/A | N/A | 91.8% |
(1) | Historical occupancies are not available as the property is newly redeveloped. Redevelopment began in 2016 and as of the Cut-off Date construction is substantially complete. |
(2) | Current Occupancy is based on the December 1, 2021 rent roll. |
Tenant Summary(1) | |||||||
Tenant | Credit Rating | Net Rentable Area (SF)3 | % of Total NRA | Base Rent(2) | Base Rent PSF(2) | % of Total Base Rent | Lease Expiration Date |
Uber | B2 / B / NR | 368,179 | 15.8% | $11,801,870 | $32.05 | 17.2% | 6/30/2030 |
Walgreens(3) | Baa2 / BBB / BBB- | 219,698 | 9.4 | 6,573,550 | $29.92 | 9.6 | 11/30/2032 |
Pepsico | A1 / A+ / NR | 193,420 | 8.3 | 6,636,908 | $34.31 | 9.7 | 12/31/2028 |
CBOE | A3 / A- / NR | 188,667 | 8.1 | 6,283,716 | $33.31 | 9.2 | 8/31/2035 |
Cisco Systems, Inc. | A1 / AA- / NR | 134,270 | 5.8 | 4,864,503 | $36.23 | 7.1 | 7/31/2030 |
FHLBC | Aaa / AA+ / NR | 129,065 | 5.5 | 4,282,177 | $33.18 | 6.2 | 12/31/2035 |
Ferrara Candy | NR / NR / NR | 115,828 | 5.0 | 4,151,013 | $35.84 | 6.0 | 10/31/2031 |
Vizient | Ba3 / BB / NR | 110,769 | 4.8 | 3,826,758 | $34.55 | 5.6 | 4/30/2038 |
Abelson-Taylor, Inc.(4) | NR / NR / NR | 84,887 | 3.6 | 2,564,052 | $30.21 | 3.7 | 2/28/2035 |
TrueBlue(5) | NR / NR / NR | 82,578 | 3.5 | 2,793,201 | $33.83 | 4.1 | 6/30/2036 |
Total Occupied | 1,627,361 | 69.8% | $53,777,748 | $33.05 | 78.3% | ||
Other Occupied Tenants | 431,737 | 18.5 | 12,802,178 | $29.65 | 18.6 | ||
Amenity(6) | 80,948 | 3.5 | 2,074,293 | $25.63 | 3.0 | ||
Total Occupied Space | 2,140,046 | 91.8% | $68,654,219 | $32.08 | 100.0% | ||
Vacant | 191,431 | 8.2 | |||||
Total / Wtd. Avg. | 2,331,477 | 100.0% | |||||
(1) | Based on the underwritten rent roll dated December 1, 2021. Certain tenants have associated gap and free rent abatements all of which were reserved for on the origination date. |
(2) | Base Rent and Base Rent PSF are exclusive of straight line credit for investment grade tenants taken through the Old Chicago Post Office Whole Loan term. |
(3) | Walgreens tenancy is comprised of (i) 208,557 square feet of office space ($29.88 per square foot) and (ii) 11,141 square feet of ground floor retail ($30.75 per square foot). Lease Expiration Date is reflective of Walgreens office lease. The Lease Expiration Date with respect to the Walgreens retail space is March 31, 2034. Please see “Major Office Tenant Termination Options” below. |
(4) | Abelson-Taylor is currently marketing 43,000 square feet (approximately 1.8% of net rentable area) for sublease. The related lease expires in February 2035 with a one-time termination option in February 2032, both beyond the term of the Old Chicago Post Office Whole Loan. |
(5) | TrueBlue subleased a portion of its’ space (24,853 square feet, approximately 1.1% of net rentable area) to Peerless Network, Inc. The related lease expires in October 2024 and has a base rental rate of $28.17 per square foot during the initial lease year. |
(6) | Amenity spaces at the Old Chicago Post Office Property have been leased to the Property Manager, an affiliate of the Loan Sponsor, which in turn passes through related rents to the underlying tenant’s at the Old Chicago Post Office Property. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
Major Office Tenant Termination Options | ||||
Tenant | NRA(1) | % of NRA | Termination/Contraction Effective Date | Termination |
Uber | 368,179 | 15.8% | 12/31/2025 | One-time option, effective December 31, 2025, to surrender not less than 35,000 square feet nor more than 45,000 square feet, subject to a requirement for a prior notice by no later than September 30, 2024, and a contraction fee equal to the unamortized portion of leasing costs and three months recurring rent. |
Walgreens | 219,698 | 9.4% | 11/30/2027 | One-time option, effective November 30, 2027, to surrender 38,000 to 42,000 square feet, subject to a 12 months’ prior notice and a contraction fee equal to the unamortized portion of leasing costs. |
PepsiCo | 193,420 | 8.3% | 12/31/2025 | One-time option, effective December 31, 2025, to reduce the square footage by 22,367 square feet, subject to at least 12 months’ prior notice and a contraction fee equal to two months’ recurring rent and the unamortized portion of leasing costs. |
CBOE | 188,667 | 8.1% | 8/31/2032 | One-time termination option, effective August 31, 2032, subject to 18 months’ prior notice and a termination fee equal to six times the monthly recurring rent and the unamortized portion of the leasing costs. |
Cisco Systems, Inc. | 134,270 | 5.8% | 1/31/2028 | One-time termination option, effective on the last day of the 90th lease month, subject to a 12 months’ notice requirement and termination fee equal to four times the monthly recurring rent and the unamortized portion of leasing costs. |
FHLBC | 129,065 | 5.5% | 12/31/2030 | One-time termination option, effective on the last day of the 10th lease year, subject to a 15 months’ notice requirement and a termination fee equal to (i) three times the monthly rent, (ii) $11,356,633 and (iii) the unamortized portion of leasing costs. |
Ferrara Candy | 115,828 | 5.0% | 9/30/2028 | One-time termination option, effective on the 9th year anniversary of the lease commencement date, subject to a 12 months’ notice requirement and a termination fee equal to the unamortized portion of the leasing costs and four months of recurring rent. |
Vizient | 110,769 | 4.8% | 4/30/2035 | One-time termination option, effective on the last day of the 12th lease year, subject to a 15 months’ notice requirement and a termination fee equal to the sum of (i) five times the monthly base rent, (ii) five times the monthly installment of additional rent and (iii) the unamortized portion of the leasing costs. |
Abelson-Taylor, Inc. | 84,887 | 3.6% | 2/29/2032 | One-time termination option, effective on the last day of the 12th lease year, subject to a 12 months’ notice requirement and a termination fee equal to unamortized leasing costs and two months of recurring rent. |
TrueBlue | 82,578 | 3.5% | 3/31/2033 | One-time termination option, effective on the last day of the 12th of the last lease year, subject to a 12 months’ notice requirement and a termination fee equal to two times recurring rent and the unamortized portion of the leasing costs. |
Total | 1,627,361 | 69.8% |
(1) | Based on the underwritten rent roll dated as of December 1, 2021. |
Lease Rollover Schedule(1) | |||||||||
Year | Number of Leases Expiring | Net Rentable Area Expiring | % of NRA Expiring | Base Rent Expiring(2)(3) | % of Base Rent Expiring(2)(3) | Cumulative Net Rentable Area Expiring | Cumulative % of NRA Expiring | Cumulative Base Rent Expiring | Cumulative % of Base Rent Expiring |
Vacant | NAP | 191,431 | 8.2% | NAP | NAP | 191,431 | 8.2% | NAP | NAP |
2022 & MTM | 0 | 0 | 0.0% | 0 | 0.0% | 191,431 | 8.2% | $0 | 0.0% |
2023 | 1 | 2,389 | 0.1% | 130,416 | 0.2% | 193,820 | 8.3% | $130,416 | 0.2% |
2024 | 1 | 1,493 | 0.1% | 81,503 | 0.1% | 195,313 | 8.4% | $211,918 | 0.3% |
2025 | 0 | 0 | 0.0% | 0 | 0.0% | 195,313 | 8.4% | $211,918 | 0.3% |
2026 | 0 | 0 | 0.0% | 0 | 0.0% | 195,313 | 8.4% | $211,918 | 0.3% |
2027 | 0 | 0 | 0.0% | 0 | 0.0% | 195,313 | 8.4% | $211,918 | 0.3% |
2028 | 1 | 193,420 | 8.3% | 6,636,908 | 9.7% | 388,733 | 16.7% | $6,848,826 | 10.0% |
2029(4) | 0 | 80,948 | 3.5% | 2,074,293 | 3.0% | 469,681 | 20.1% | $8,923,119 | 13.0% |
2030 | 2 | 502,449 | 21.6% | 16,666,373 | 24.3% | 972,130 | 41.7% | $25,589,492 | 37.3% |
2031 | 1 | 115,828 | 5.0% | 4,151,013 | 6.0% | 1,087,958 | 46.7% | $29,740,504 | 43.3% |
2032 & Beyond(5) | 18 | 1,243,519 | 53.3% | 38,913,714 | 56.8% | 2,331,477 | 100.0% | $68,654,219 | 100.0% |
Total | 24 | 2,331,477 | 100.0% | $68,654,219 | 100.0% | ||||
(1) | Based on the underwritten rent roll dated December 1, 2021. |
(2) | Certain tenants may hold termination or contraction options (which may become exercisable prior to the originally stated expiration date of the tenant lease) that are not considered in the above Lease Rollover Schedule. |
(3) | Base Rent Expiring and % of Base Rent Expiring are exclusive of straight line credit for investment grade tenants taken through the loan term. |
(4) | Inclusive of square footage and base rent attributable to amenity spaces leased to an affiliate of the Loan Sponsor. |
(5) | 2032 & Beyond includes storage and management office space. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
Underwritten Net Cash Flow(1)(2) | ||||
Loan Sponsor Budget | Underwritten | Per Square Foot | % of EGI | |
Base Rent | $68,654,219 | $68,654,219 | $29.45 | 59.3% |
Vacant Income | 6,317,223 | 6,285,085 | $2.70 | 5.4% |
Gross Potential Rent | $74,971,442 | $74,939,304 | $32.14 | 64.7% |
Total Reimbursements | 35,898,718 | 39,460,931 | $16.93 | 34.1% |
Gross Rental Income | $110,870,160 | $114,400,235 | $49.07 | 98.8% |
(Vacancy/Credit Loss) | (9,342,111) | (9,594,634) | ($4.12) | (8.4)% |
Straight Line Rent Credit(3) | $0 | 1,357,955 | $0.58 | 1.2% |
Total Other Income(4) | 9,638,410 | 9,638,410 | $4.13 | 8.4% |
Effective Gross Income | $111,166,459 | $115,801,966 | $49.67 | 100.0% |
Total Expenses(5) | 38,166,196 | 39,254,351 | $16.84 | 33.9% |
Net Operating Income | $73,000,263 | $76,547,615 | $32.83 | 66.1% |
TI/LC | 0 | 0 | $0.00 | 0.0% |
Replacement Reserves | 0 | 467,228 | $0.20 | 0.4% |
Net Cash Flow | $73,000,263 | $76,080,387 | $32.63 | 65.7% |
(1) | Based on the underwritten rent roll dated December 1, 2021. |
(2) | Historical financials are not available as the property is newly redeveloped. Redevelopment began in 2016 and as of the Cut-off Date construction is substantially complete. |
(3) | Underwritten Straight Line Rent Credit is inclusive straight line rent for investment grade tenants through the Old Chicago Post Office Whole Loan term. |
(4) | Total Other Income is inclusive of event rental/commission income, fitness center income, food hall operations income, parking revenue. |
(5) | Underwritten Total Expenses are inclusive of real estate taxes subject to certain adjustments assuming the Borrower has attained Class L real estate tax designation and benefits from the associated real estate tax savings. See “Class L Tax Abatement” below. |
Property Management. The Old Chicago Post Office Property is managed by 601 W Chicago OPO Property Manager LLC, an affiliate of the Borrower and sub-managed by Jones Lang LaSalle Americas, Inc., a Maryland corporation.
Escrows and Reserves. At loan origination, the Borrower deposited (i) approximately $302,576 into an insurance reserve, (ii) approximately $2,343,888 into a real estate tax reserve, (iii) approximately $3,911,510 into a remaining hard cost reserve, (iv) approximately $4,265,829 into an HTC put obligation reserve, (v) approximately $50,942,055 into an outstanding TI/LC reserve and (vi) approximately $59,453,368 into a gap and free rent reserve.
Tax Reserve – On each monthly due date, the Borrowers is required to deposit an amount equal to 1/12th of the estimated annual real estate taxes and other charges into the tax reserve account.
Insurance Reserve – On each monthly due date, the Borrower is required to deposit into an insurance reserve an amount equal to 1/12th of estimated insurance premiums. Notwithstanding the foregoing, if the Borrower maintains a blanket insurance policy in form and substance reasonably acceptable to the lender, and provided that no event of default exists and remains uncured, the Borrower will not be required to make monthly deposits for insurance premiums into the Tax and Insurance Reserve account.
Replacement Reserve – On each monthly due date, the Borrower is required to deposit approximately $48,572 into a replacement reserve, subject to a cap of $1,165,739.
TI/LC Reserve – On each monthly due date, during the continuance of a Cash Sweep Event (as defined below), the Borrower is required to deposit approximately $194,289.
HTC Put Obligation Reserve – Commencing on January 1, 2025 and continuing each monthly due date thereafter, the Borrower is required to deposit approximately $177,743. The HTC Put Obligation Reserve may be used to purchase the HTC Investor’s ownership interest in the Master Lessee in the event that the HTC Investor exercises its related put option after the recapture period. See “Description of the Mortgage Pool–Real Estate and Other Tax Considerations” in the Preliminary Prospectus.
Lockbox / Cash Management. The Old Chicago Post Office Whole Loan is structured with an in place hard lockbox and in place cash management. At loan origination, the Borrower was required to deliver tenant direction letters instructing all tenants to deposit rents into a lender-controlled lockbox account. All funds in the lockbox accounts will be swept twice per week into a cash management account controlled by the lender throughout the term of the Old Chicago Post Office Whole Loan. All funds on deposit in the Cash Management Account will be used first to pay the Master Lessee Monthly Remittance Amount (as defined below) to the master lessee on each payment date. Any amounts remaining in the cash management account after payment of the Master Lessee Monthly Remittance Amount will be run through lender’s cash management waterfall. All funds on deposit in the cash management account will be used first to pay the Master Lessee Monthly Remittance Amount (as defined below) to the Master Lessee (as defined below) on each payment date. During the
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
continuance of a Cash Sweep Event, all excess cash remaining in the cash management account after payment of the Master Lessee Monthly Remittance Amount will be applied in accordance with the Old Chicago Post Office Whole Loan documents and are required to be held by the lender in an excess cash flow reserve account as additional collateral for the Old Chicago Post Office Whole Loan, provided, that, in the event of a Major Tenant Trigger Event (as defined below), the lender will only continue to hold excess cash until such time as the amount in the excess cash reserve equals $100.00 times the aggregate number of rentable square feet demised by the applicable major lease.
A “Cash Sweep Event” means (a) an event of default under the Old Chicago Post Office Whole Loan or the Old Chicago Post Office Mezzanine Loan (b) the bankruptcy or insolvency of the Borrower, master lessee, manager or sub-manager, (c) if the debt service coverage ratio based on the trailing three month period immediately preceding the date of determination is less than (x) 1.65x for the total debt including the Old Chicago Post Office Whole Loan and the Old Chicago Post Office Mezzanine Loan (the “Old Chicago Post Office Total Debt”) and (y) 2.28x for the Old Chicago Post Office Whole Loan (a “DSCR Trigger Event”), or (d) a Major Tenant Trigger Event.
A Cash Sweep Event may be cured upon occurrence of the following: (i) with respect to the clause (c) above, the achievement of a debt service coverage ratio of (A) 1.70x or greater with respect to the Old Chicago Post Office Total Debt and (B) 2.35x or greater with respect to the Old Chicago Post Office Whole Loan, in each case, for two consecutive quarters based upon the trailing three-month period immediately preceding the date of determination, (ii) with respect to the clause (a) above, the acceptance by the lender under the Old Chicago Post Office Whole Loan or the Old Chicago Post Office Mezzanine Loan, as applicable, of a cure of such event of default, (iii) with respect to the clause (b) above solely with respect to the manager, if the Borrower replaces the manager with a “Qualified Manager” (as fully described in the Old Chicago Post Office Whole Loan documents) under a replacement management agreement acceptable to the lender in accordance with the Old Chicago Post Office Whole Loan documents within 60 days after such bankruptcy action, or (iv) with respect to the clause (d) above, (A) if the Borrower leases all or substantially all of the space previously leased to the Major Tenant (as defined below) to one or more replacement tenants reasonably acceptable to the lender pursuant to one or more leases reasonably acceptable to the lender, (B) if the Major Tenant that is the subject of a Major Tenant Operations Trigger Event (as defined below) (x) has delivered notice of its intent to vacate or terminate its lease and subsequently rescinds such notice in writing or (y) was dark and subsequently resumes operations and, in each case, such Major Tenant is paying full unabated rent (other than full or partial abatements set forth in such Major Tenant’s lease provided such abated rent has been reserved with the lender), (C) if the Major Tenant that was the subject of a Major Tenant Renewal Trigger Event extends its lease or (D) if the Major Tenant that was the subject of a bankruptcy action assumes its lease in such bankruptcy action; provided, (i) no event of default has occurred and is continuing under the Old Chicago Post Office Whole Loan documents or the Old Chicago Post Office Mezzanine Loan documents, (ii) a Cash Sweep Event may be cured no more than a total of four times in the aggregate during the term of the Old Chicago Post Office Whole Loan, and (iii) the Borrower has paid all of the lender’s reasonable expenses incurred in connection with such cure of a Cash Sweep Event, including reasonable attorneys’ fees and expenses.
A “Major Tenant” means Uber.
A “Major Tenant Trigger Event” means (a) any bankruptcy action of the Major Tenant, (b) the failure of the Major Tenant to renew its lease prior to the date that is 12 months prior to the expiration date of its lease (a “Major Tenant Renewal Trigger Event”), or (c) the Major Tenant, among other things, “going dark”, vacating, or otherwise abandoning its premises or terminating its lease in accordance with the Old Chicago Post Office Whole Loan documents (a “Major Tenant Operations Trigger Event”).
The “Master Lessee Monthly Remittance Amount” means any revenues from the Old Post Office portion of the Old Chicago Post Office Property that exceed the sum of (i) base rent (currently $3,541,666.66 per month), (ii) 1/12th of the estimated annual percentage rent (if cash receipts are in excess of annual base rent in any collection period, then percentage rent will equal 20% of cash receipts, provided that such amount will not exceed 90% of the excess of cash receipts over project expenses), subject to an annual reconciliation if the monthly projected percentage rent that is paid to Borrower in aggregate over a calendar year ends up being different than the annual percentage rent required under the master lease), (iii) any accrued and unpaid rent that is due and payable to Borrower under the master lease, (iv) certain project expenses (including, without limitation, operating expenses and the costs of any necessary repairs and replacements of the Old Chicago Post Office Property in accordance with an approved capital budget) and (v) 1/12th of the projected annual distribution to the managing member of master lessee, which is an affiliate of Borrower, under the operating agreement of master lessee.
Current Mezzanine or Subordinate Indebtedness. Concurrently with the funding of the Old Chicago Post Office Whole Loan, the direct and certain indirect equity owners of the Borrower pledged their respective direct or indirect ownership interests to secure a mezzanine loan in the original principal amount of $125,000,000 (the “Old Chicago Post Office Mezzanine Loan”). The Old Chicago Post Office Mezzanine Loan is coterminous with the Old Chicago Post Office Whole Loan. Interest is payable on the Old Chicago Post Office Mezzanine Loan at a fixed per annum rate equal to 8.50000%. The rights of the mezzanine lender under the Old Chicago Post Office Mezzanine Loan is further described under “Description of the Mortgage Pool—Additional Indebtedness—Mezzanine Indebtedness” in the Preliminary Prospectus.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
Future Mezzanine or Subordinate Indebtedness Permitted. None.
Partial Release. The Borrower may obtain release of a certain parcel as described in the Old Chicago Post Office Whole Loan documents (the “Release Parcel”) from the lien of the mortgage upon the satisfaction of the conditions set forth in the Old Chicago Post Office Whole Loan documents, including, without limitation, the following: (i) the amount of the outstanding principal balance of the Old Chicago Post Office Whole Loan to be defeased must equal or exceed $30,492,644, (ii) no event of default is continuing, (iii) after giving effect to the release of the Release Parcel (including the portion of the Old Chicago Post Office Whole Loan defeased), (A) the debt service coverage ratio for the Old Chicago Post Office Property then remaining subject to the lien of the mortgage based on the trailing 12-month period immediately preceding the release of the Release Parcel must be equal to or greater than the greater of (x) 1.90x and (y) the debt service coverage ratio immediately preceding the release of the Release Parcel based on the trailing 12-month period immediately preceding the release of the Release Parcel for the Old Chicago Post Office Total Debt and (B) the debt service coverage ratio (mortgage only) for the Old Chicago Post Office Property then remaining subject to the lien of the mortgage based on the trailing 12-month period immediately preceding the release of the Release Parcel must be equal to or greater than the greater of (x) 2.61x and (y) the debt service coverage ratio (mortgage only) immediately preceding the release of the Release Parcel based on the trailing 12-month period immediately preceding the release of the Release Parcel for the Old Chicago Post Office Whole Loan, (iv) the Borrower must transfer title of the Release Parcel to a person other than the Borrower or any of its affiliates, (v) the borrower of the Old Chicago Post Office Mezzanine Loan must prepay the Old Chicago Post Office Mezzanine Loan in an amount which equals or exceeds $4,592,266, together with the payment of the applicable yield maintenance premium, and (vi) upon release of the Release Parcel, the customary REMIC rules are satisfied.
Class L Tax Abatement. The Borrower has applied for a reduction in the assessed value of a portion of the Old Chicago Post Office Property, including the underlying land, under the Cook County Class L real estate tax incentive program (the “Class L Reduction”), which encourages the preservation and rehabilitation of landmark commercial, industrial and income-producing not-for-profit buildings. If the Class L Reduction is approved, the value of the applicable portion of the Old Chicago Post Office Property will be assessed for real estate taxes at reduced assessment levels for a 12-year period: 10% of full market value for the first 10 years, 15% in year 11, 20% in year 12 and back to the regular assessment level in year 13, which is currently 25% of full market value. See “Description of the Mortgage Pool – Real Estate and Other Tax Considerations” in the Preliminary Prospectus for additional information.
Historic Tax Credits. In connection with the Borrower’s rehabilitation and conversion of the Old Chicago Post Office Property from a former United States Postal Service building to an office property, the Old Chicago Post Office Property benefits from federal historic tax credits (the “HTCs”), in the amount equal to 20% of the qualified rehabilitation expenditures (“QREs”) incurred in connection with such rehabilitation. The Borrower has elected to pass the HTCs though to the Master Lessee (as defined below). The Loan Sponsor has sold a 99% interest in the Master Lessee to Carlisle Sandpiper Historic Fund II Limited Partnership, (a majority of which is owned by an entity affiliated with JPMCB) (the “HTC Investor“), resulting in the HTC Investor being entitled to 99% of the HTCs due to its equity interest in the Master Lessee. . An affiliate of the borrower (the” Managing Member of the Master Lessee”) retains a 1% controlling interest in the master lessee, which interest the Managing Member of the Master Lessee has pledged as collateral for the Old Chicago Post Office Whole Loan. The HTCs are subject to recapture in the event the building on which HTCs were claimed ceases to be a “business use property” or upon a “disposition” of the building (which includes, among other things, a sale or transfer of the improvements attributable to QREs (the “Rehabilitation Improvements”)) prior to the first business day following the fifth anniversary of the date on which the related Rehabilitation Improvements are “Placed in Service” (the “HTC Recapture Period Expiration Date”). In addition, pursuant to the Master Lessee’s operating agreement, the HTC Investor is entitled to certain distributions subject to available cash flow and pursuant to a certain purchase agreement (the “Purchase Agreement”) between the Managing Member of the Master Lessee and the HTC Investor, the HTC Investor has a put-option to cause the Managing Member of the Master Lessee to purchase all of the HTC Investor’s interests in the Master Lessee upon the occurrence of the HTC Recapture Period Expiration Date and the payment to HTC Investor of aggregate distributions equal to or greater than 10% of the Master Lessee’s capital contributions (or, in the event that the Lender or Mezzanine Lender has foreclosed on the Property or accepted a deed in lieu thereof, HTC Investor may exercise it’s put option upon the occurrence of any recapture of the HTCs). See “Description of the Mortgage Pool – Real Estate and Other Tax Considerations” in the Preliminary Prospectus for additional information.
Master Lease. In connection with the Old Chicago Post Office Property benefitting from the HTC program, the borrower leased the Old Chicago Post Office Property to 601W Companies Chicago MT LLC (“Master Lessee”), pursuant to a master lease, under which the Master Lessee operates the Old Chicago Post Office Property and pays an annual rent to the Borrower, payable out of the net cash flow of the Old Chicago Post Office Property. The Master Lessee has agreed to deposit all income generated by the property into a lockbox account for the benefit of Lender. Pursuant to the related subordination, non-disturbance and attornment agreement among the lender, the Borrower, and the Master Lessee, the master lease is subordinate to the lien of the mortgage in exchange for the lender’s agreement to not terminate the master lease following a foreclosure until the “HTC Recapture Period Expiration Date” for the last QRE that is included in any federal income tax return of the Master Lessee or the HTC Investor. The Lender has agreed that, notwithstanding whether any Cash Sweep Event or event of default is continuing, each month it will disburse to Master Lessee any revenues from the Old Post Office portion of the Old Chicago Post Office Property that exceed the sum of (i) base rent (currently $3,541,666.66 per month), (ii) 1/12th of the estimated annual percentage rent (if cash receipts are in excess of annual base rent in any collection period, then percentage rent will equal 20% of cash receipts, provided that such amount will not exceed 90% of the excess of cash receipts over project expenses), subject
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Old Chicago Post Office |
to an annual reconciliation if the monthly projected percentage rent that is paid to Borrower in aggregate over a calendar year ends up being different than the annual percentage rent required under the Master Lease), (iii) any accrued and unpaid rent that is due and payable to the Borrower under the master lease (iv) certain project expenses (including, without limitation, operating expenses and the costs of any necessary repairs and replacements of the Old Chicago Post Office Property in accordance with an approved capital budget) and (v) 1/12th of the projected annual distribution to the Managing Member of Master Lessee, which is an affiliate of the Borrower, under the operating agreement (the “Master Lessee Operating Agreement”) of the Master Lessee (the “Master Lessee Monthly Remittance Amount”). See “Description of the Mortgage Pool – Tenant Issues – Affiliated Leases” in the Preliminary Prospectus for additional information.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
25 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Bedrock Portfolio |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
26 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Bedrock Portfolio |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
27 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Bedrock Portfolio |
Mortgage Loan Information | Property Information | |||
Mortgage Loan Seller: | JPMCB | Single Asset / Portfolio: | Portfolio | |
Original Principal Balance(1): | $125,000,000 | Title(3): | Fee / Leasehold | |
Cut-off Date Principal Balance(1): | $125,000,000 | Property Type – Subtype(4): | Various / Various | |
% of Pool by IPB: | 7.0% | Net Rentable Area (SF): | 2,694,627 | |
Loan Purpose: | Refinance | Location: | Detroit, Michigan | |
Borrower(2): | Various | Year Built / Renovated(4): | Various / Various | |
Guarantor: | Rock Backer LLC | Occupancy(5): | 88.7% | |
Interest Rate: | 3.77800% | Occupancy Date: | Various | |
Note Date: | 12/28/2021 | Number of Tenants: | 113 | |
Maturity Date: | 1/1/2029 | Fourth Most Recent NOI: | $42,141,735 (December 31, 2018) | |
Interest-only Period: | 84 months | Third Most Recent NOI: | $47,208,742 (December 31, 2019) | |
Original Term: | 84 months | Second Most Recent NOI: | $54,095,059 (December 31, 2020) | |
Original Amortization: | None | Most Recent NOI: | $55,595,704 (TTM September 30, 2021) | |
Amortization Type: | Interest Only | UW Economic Occupancy: | 87.7% | |
Call Protection: | L(25),YM1(55),O(4) | UW Revenues: | $97,560,449 | |
Lockbox / Cash Management: | Hard (Commercial); | UW Expenses: | $39,136,450 | |
Springing (Residential) / Springing | UW NOI: | $58,423,999 | ||
Additional Debt(1): | Yes | UW NCF: | $54,409,505 | |
Additional Debt Balance(1): | $305,000,000 | Appraised Value / Per SF: | $724,300,000 / $269 | |
Additional Debt Type(1): | Pari Passu | Appraisal Date: | Various | |
Escrows and Reserves(6) | Financial Information(1) | ||||||
Initial | Monthly | Initial Cap | Cut-off Date Loan / SF: | $160 | |||
Taxes: | $1,696,002 | $424,000 | N/A | Maturity Date Loan / SF: | $160 | ||
Insurance: | $0 | Springing | N/A | Cut-off Date LTV: | 59.4% | ||
Replacement Reserves: | $62,336 | $62,336 | $1,469,568 | Maturity Date LTV: | 59.4% | ||
TI/LC: | $280,690 | $280,690 | $5,000,000 | UW NCF DSCR: | 3.30x | ||
Other: | $9,362,153 | $0 | N/A | UW NOI Debt Yield: | 13.6% | ||
| |||||||
Sources and Uses | |||||||
Sources | Proceeds | % of Total | Uses | Proceeds | % of Total | ||
Loan Amount | $430,000,000 | 100.0% | Payoff Existing Debt | $331,057,990 | 77.0% | ||
Principal Equity Distribution | 83,185,780 | 19.3% | |||||
Reserves | 11,401,181 | 2.7% | |||||
Closing Costs | 4,355,049 | 1.0% | |||||
Total Sources | $430,000,000 | 100.0% | Total Uses | $430,000,000 | 100.0% | ||
(1) | The Bedrock Portfolio Loan (as defined below) is part of a whole loan evidenced by 10 pari passu notes with an aggregate outstanding principal balance of $430.0 million. The financial information in the chart above reflects the Cut-off Date Balance of the Bedrock Portfolio Whole Loan (as defined below). |
(2) | The borrowers of the Bedrock Portfolio Mortgage Loan are Michigan Parking Co LLC, 419 Fort Street LLC, 1001 Brush Street LLC, 1001 Webward LLC, One Webward Avenue LLC, 719 Griswold Associates LLC, 660 Woodward Associates LLC, 1234 Library LLC, 600 Webward Avenue LLC, 611 Webward Avenue LLC, 1505 Webward LLC, 1520 Webward Avenue LLC, Corktown Lofts LLC and WWA Parking LLC. |
(3) | The One Woodward Mortgaged Property is subject to a ground lease expiring in April 2040. |
(4) | The Bedrock Portfolio Whole Loan is secured by the fee or leasehold interests in seven office buildings, five parking garages and two mixed-use properties that were built between 1913 and 2013. Each Mortgaged Property within the portfolio was renovated between 2010 and 2019. See “Portfolio Summary” table herein. |
(5) | Occupancy represents occupancy for office and retail space in the Bedrock Portfolio. |
(6) | For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Bedrock Portfolio |
The Loan. The Bedrock Portfolio mortgage loan is part of a whole loan with an aggregate outstanding principal balance as of the Cut-off Date of $430.0 million (the “Bedrock Portfolio Whole Loan”) evidenced by 10 pari passu notes, secured by the borrower’s fee or leasehold interests in a portfolio of office, mixed use and parking garage properties located in the Detroit, Michigan central business district (the “Bedrock Portfolio” or the “Bedrock Portfolio Properties”). The controlling note A-1-1, with an aggregate outstanding principal balance as of the Cut-off Date of $125,000,000 (the “Bedrock Portfolio Loan”), will be included in the Benchmark 2022-B32 trust. The remaining notes are expected to be contributed to one or more future securitization trusts or may otherwise be transferred at any time. The Bedrock Portfolio Whole Loan was co-originated by JPMorgan Chase Bank, National Association and Starwood Mortgage Capital LLC (“SMC”). The proceeds of the Bedrock Portfolio Whole Loan were primarily used to refinance the Bedrock Portfolio, return equity to the loan sponsor and pay closing costs. The relationship between the holders of the Bedrock Portfolio Whole Loan is governed by a co-lender agreement as described under “Description of the Mortgage Pool—The Whole Loans—The Serviced Pari Passu Whole Loans” in the Preliminary Prospectus.
Whole Loan Summary | ||||
Note | Original Balance | Cut-off Date Balance | Note Holder | Controlling Piece |
A-1-1 | $125,000,000 | $125,000,000 | Benchmark 2022-B32 | Yes |
A-1-2 | $50,000,000 | $50,000,000 | JPMCB(1) | No |
A-1-3 | $50,000,000 | $50,000,000 | JPMCB(1) | No |
A-1-4 | $50,000,000 | $50,000,000 | JPMCB(1) | No |
A-1-5 | $30,000,000 | $30,000,000 | JPMCB(1) | No |
A-1-6 | $39,000,000 | $39,000,000 | JPMCB(1) | No |
A-2-1 | $40,000,000 | $40,000,000 | SMC(1) | No |
A-2-2 | $26,000,000 | $26,000,000 | SMC(1) | No |
A-2-3 | $10,000,000 | $10,000,000 | SMC(1) | No |
A-2-4 | $10,000,000 | $10,000,000 | SMC(1) | No |
Whole Loan | $430,000,000 | $430,000,000 |
(1) | Expected to be contributed to one or more future securitization trusts or otherwise transferred at any time. |
The Borrowers. The borrowers are Michigan Parking Co LLC, 419 Fort Street LLC, 1001 Brush Street LLC, 1001 Webward LLC, One Webward Avenue LLC, 719 Griswold Associates LLC, 660 Woodward Associates LLC, 1234 Library LLC, 600 Webward Avenue LLC, 611 Webward Avenue LLC, 1505 Webward LLC, 1520 Webward Avenue LLC, Corktown Lofts LLC and WWA Parking LLC, each a Delaware limited liability company structured to be single purpose bankruptcy-remote entities having at least two independent directors in their organizational structure. Legal counsel to the borrowers delivered a non-consolidation opinion in connection with the origination of the Bedrock Portfolio Whole Loan.
The Loan Sponsor. The loan sponsor is Bedrock Detroit, which is owned and controlled by Dan Gilbert and affiliated entities, and the non-recourse carveout guarantor is Rock Backer LLC. Founded in 2011, Bedrock Detroit is a full service commercial real estate firm based in downtown Detroit, specializing in the strategic development of urban cores. With a portfolio of more than 100 properties totaling over 18 million square feet, Bedrock Detroit is one of the largest real estate partners in downtown Detroit. Since its founding, Bedrock Detroit and its affiliates have invested and committed more than $5.6 billion to acquiring and developing more than 100 properties, including new construction of ground up developments in downtown Detroit and Cleveland totaling more than 20 million square feet. Bedrock Detroit’s real estate personnel provide a full range of services with in-house teams for each area of expertise, including leasing, acquisition, finance, construction, architecture, historic rehab and property management. Bedrock Detroit’s tenants include leading technology companies and startups, world-renowned restaurants and national retailers, as well as Detroit locals. Bedrock Detroit also leases mixed-income residential properties to individuals, and acquires and renovates properties for new development. Bedrock Detroit and Dan Gilbert’s family of companies have been critical in the urban revival of Detroit and have demonstrated a strong commitment to the continued growth and stability of the market.
The loan sponsor acquired the Bedrock Portfolio for an aggregate purchase price of approximately $191.2 million and has since invested approximately $464.9 million across the Bedrock Portfolio, resulting in a total cost basis of approximately $656.1 million.
The Properties. The Bedrock Portfolio consists of seven office buildings with ground floor retail (2,529,041 square feet; 80.7% of underwritten net cash flow), five parking garages (5,036 stalls; 16.1% of underwritten net cash flow) and two mixed-use multifamily buildings (53 units; 3.1% of underwritten net cash flow). The Bedrock Portfolio Properties are located in Downtown Detroit and are accessible via the I-75, I-94 and I-96 expressways in addition to other major roadways. The Bedrock Portfolio benefits from diversity across a cross collateralized portfolio encompassing several commercial and residential uses, in addition to a tenant mix representing a wide array of industries. A number of trophy office assets are included in the Bedrock Portfolio, which includes historic rehabilitations of landmark buildings, as well as state of the art ground up construction. The Bedrock Portfolio represents a critical mass of CBD Class A office inventory, comprising a substantial share of the overall submarket.
As of November 10, 2021, the Bedrock Portfolio office properties were 88.7% leased to a diverse array of institutional quality tenancy, including several sponsor-affiliated publicly traded entities. Dan Gilbert-affiliated and/or controlled entities including Quicken Loans, Amrock, Inc. and Bedrock Management Services LLC account for approximately 58.0% of underwritten base rent.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Bedrock Portfolio |
Collectively, the five parking garages drive approximately 16.1% of underwritten net cash flow. The parking garage component features a combination of long-term parking leases (62.1% of total parking garage revenue), month-to-month leases (37.4% of total parking garage revenue), as well as transient parking (0.5% of total parking garage revenue). The parking garages in the Bedrock Portfolio benefit from high demand for parking in the Detroit central business district, with an average monthly utilization (occupancy) of 124.5% on leased and month-to-month parking spaces (not including transient parking) as of the third quarter of 2021. Utilization has averaged 122.8% since Q1 2019. Due to the lack of publicly available transportation historically driven in part by resistance from the motor vehicle industry, Detroit has functioned primarily on personal car transportation which continues to benefit the garages in the Bedrock Portfolio.
Portfolio Summary | |||||||||
Property Name | Property Type / Subtype | Year Built / Renovated | SF / Stalls / Units | Allocated Whole Loan Cut-off Date Balance | % of Allocated Whole Loan Cut-off Date Balance | Appraised Value | % of Appraised Value | UW NCF | % of UW NCF |
First National Building | Office / CBD | 1921 / 2010 | 800,119 / 427 / - | 99,140,800 | 23.1% | $162,000,000 | 22.4% | $14,276,324 | 26.2% |
The Qube | Office / CBD | 1958 / 2011 | 522,702 / - / - | 63,038,000 | 14.7% | 103,000,000 | 14.2% | $8,693,152 | 16.0% |
Chrysler House | Office / CBD | 1919 / 2013 | 343,488 / 924 / - | 49,278,000 | 11.5% | 83,000,000 | 11.5% | $6,142,746 | 11.3% |
1001 Woodward | Office / CBD | 1965 / 2013 | 319,039 / 731 / - | 48,959,800 | 11.4% | 80,000,000 | 11.0% | $6,887,443 | 12.7% |
One Woodward | Office / CBD | 1962 / 2013 | 370,257 / 90 / - | 35,492,200 | 8.3% | 58,000,000 | 8.0% | $5,096,070 | 9.4% |
The Z Garage | Other / Parking Garage | 2013 / 2015-2016 | 40,227 / 1,351 / - | 29,007,800 | 6.7% | 53,000,000 | 7.3% | $2,078,882 | 3.8% |
Two Detroit Garage | Other / Parking Garage | 2002 / 2015-2016 | - / 1,106 / - | 21,955,800 | 5.1% | 37,000,000 | 5.1% | $2,928,886 | 5.4% |
1505 & 1515 Woodward | Office / CBD | 1925 / 2018 | 141,741 / - / - | 20,777,600 | 4.8% | 35,000,000 | 4.8% | $2,454,589 | 4.5% |
1001 Brush Street | Other / Parking Garage | 1993 / 2015-2016 | 38,519 / 1,309 / - | 17,535,400 | 4.1% | 32,000,000 | 4.4% | $1,683,875 | 3.1% |
The Assembly | Mixed Use / Multifamily/Office/Retail | 1913 / 2019 | 81,147 / 50 / 32 | 13,717,000 | 3.2% | 23,100,000 | 3.2% | $1,334,926 | 2.5% |
419 Fort Street Garage | Other / Parking Garage | 2005 / 2015-2016 | - / 637 / - | 12,470,000 | 2.9% | 21,000,000 | 2.9% | $1,584,990 | 2.9% |
Vinton | Mixed Use / Multifamily/Retail | 1917 / 2018 | 5,693 / - / 21 | 7,525,000 | 1.8% | 17,500,000 | 2.4% | $377,823 | 0.7% |
1401 First Street | Other / Parking Garage | 1976 / 2017 | - / 633 / - | 7,421,800 | 1.7% | 13,500,000 | 1.9% | $502,080 | 0.9% |
Lane Bryant Building | Office / CBD | 1917 / 2018 | 31,695 / - / - | 3,680,800 | 0.9% | 6,200,000 | 0.9% | $367,719 | 0.7% |
Total | 2,694,627 / 7,258 / 53 | $430,000,000 | 100.0% | $724,300,000 | 100.0% | $54,409,505 | 100.0% |
Historical Parking Utilization(1) | |||||||||||||
Parking Garages | Stalls | Q1 2019 | Q2 2019 | Q3 2019 | Q4 2019 | Q1 2020 | Q2 2020 | Q3 2020 | Q4 2020 | Q1 2021 | Q2 2021 | Q3 2021 | Average |
1001 Brush Street | 1,309 | 119.3% | 118.6% | 120.8% | 119.0% | 131.5% | 127.1% | 129.3% | 122.7% | 116.7% | 91.5% | 129.3% | 120.5% |
1401 First Street | 633 | 147.9% | 131.3% | 130.3% | 133.3% | 107.7% | 92.1% | 80.9% | 79.8% | 76.8% | 78.5% | 80.9% | 103.6% |
419 Fort Street Garage | 637 | 106.4% | 109.6% | 122.8% | 120.1% | 152.9% | 163.7% | 167.7% | 153.4% | 146.2% | 142.1% | 167.7% | 141.1% |
The Z Garage | 1,351 | 119.3% | 119.0% | 120.0% | 117.6% | 125.7% | 119.0% | 112.2% | 107.8% | 101.1% | 115.2% | 112.2% | 115.4% |
Two Detroit Garage | 1,106 | 119.0% | 119.9% | 120.8% | 120.2% | 122.9% | 127.3% | 134.2% | 146.8% | 162.6% | 177.3% | 134.2% | 135.0% |
Total / Wtd. Avg. | 5,036 | 121.2% | 119.4% | 122.0% | 120.8% | 127.8% | 125.2% | 124.5% | 122.5% | 121.3% | 121.4% | 124.5% | 122.8% |
(1) | Historical parking utilization above 100% is attributable to transient parking allowing for a single space to be occupied by multiple users in a given day. |
Major Tenants.
The largest tenant, Quicken Loans Inc. (“Quicken Loans”) (905,935 square feet; 33.6% of net rentable area; 39.5% of underwritten base rent), was founded in 1985 and markets conventional, government insured and sub-prime debt consolidation and home financing loans, secured primarily by first or second mortgages on one-to four-family, owner-occupied residences. Quicken Loans originates loans through 18 stores and branches, one call center and an Internet site. During the third quarter of 2021, Quicken Loans originated approximately $88 billion of mortgage loans and generated net income of approximately $1.4 billion. Quicken Loans rebranded in July 2021 and is now known as Rocket Mortgage. Quicken Loans leases space in five buildings with staggered lease expiration dates, including (i) 183,664 square feet expiring in August 2023 for which it has two, five-year renewal options, (ii) 122,475 square feet expiring in April 2024 for which it has three, three-year renewal options, (iii) 407,050 square feet expiring in July 2028 for which it has two, five-year renewal options, (iv) 21,124 square feet expiring in January 2030 for which it has two, five-year renewal options and (v) 156,020 square feet expiring in March 2032 for which it has, two, five-year renewal options. Quicken Loans has no remaining termination options. Dan Gilbert, the founder of the Loan Sponsor, has voting control in Rocket Mortgage as a preferred shareholder.
The second largest tenant, Amrock, Inc (“Amrock”) (424,486 square feet; 15.8% of net rentable area; 16.7% of underwritten base rent), was founded in 1997 and provides title insurance, property valuations, and settlement services in the United States. Amrock offers residential solutions for a range of settlement services and products, including defined process work flows and data integrations; commercial title insurance coverages; valuation products and services through a network of residential real estate appraisers; title and settlement services in the state of Connecticut; escrow and closing services in the state of Washington; and ATLAS, a technology platform that supports title and settlement service platform, as well as allows a client to manage preferences, prioritize orders, and work flows. Amrock serves Fortune 100 companies and residential mortgage lenders, as well as residential lending institutions and smaller community-based lenders. Amrock has two, five-year renewal options and no termination options. Amrock is affiliated with Dan Gilbert and the Loan Sponsor.
Quicken Loans and Amrock are subsidiaries of Rocket Mortgage Companies (NYSE:RKT), founded and controlled by Dan Gilbert, which announced its IPO in the summer of 2020. Rocket Mortgage Companies engages in the tech-driven real estate, mortgage and eCommerce businesses in the United States and Canada. As of January 11, 2022, Rocket Mortgage Companies had a market cap of approximately $28.1 billion and approximately 24,000 employees.
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.
30 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Bedrock Portfolio |
The third largest tenant, Honigman Miller Schwartz and Cohn LLP (“Honigman”) (150,786 square feet; 5.6% of net rentable area; 6.7% of underwritten base rent), was founded in 1948 and is a law firm that employs over 325 attorneys and 350 staff and operates a local, national, and international practice from its Michigan offices in Detroit, Bloomfield Hills, Lansing, Ann Arbor, Kalamazoo, and Grand Rapids, its Illinois office in Chicago and its office in Washington, DC. Honigman’s attorneys practice in more than 60 different areas of business law. Honigman has two, five-year renewal options and no termination options.
The Market. The Bedrock Portfolio is located in downtown Detroit, Michigan, which, according to the appraisal, remains the economic and entertainment focal point of southeast Michigan and serves as a major international crossing with Canada. The Bedrock Portfolio benefits from Detroit’s hub layout that results in many roadways emanating from the central business district into the surrounding communities. Detroit is serviced by the Detroit-Metropolitan Wayne County Airport situated approximately fifteen miles southwest in the City of Romulus. This international airport serves as the mid-western hub of operation for Delta Airlines, as well as servicing other commercial airlines. Passenger rail service to other cities is provided by Amtrak with the central station located in the New Center area immediately north of the central business district.
According to the appraisal, the primary demand generator in Downtown Detroit has been the growing employment base. A number of large employers have anchored the central business district including Quicken Loans, TitleSource, Blue Cross/Blue Shield, MSX International, Rossetti and Campbell Ewald. Downtown Detroit offers a number of entertainment districts including Foxtown, the sports venues (Ford Field, home to the NFL’s Detroit Lions, Comerica Park, home to MLB’s Detroit Tigers, and Little Caesars Arena, home to the NBA’s Detroit Pistons and the NHL’s Detroit Red Wings) and three casinos. There are a growing number of restaurants and bars throughout the Downtown area. This district is emerging with new developments and renovation projects that are projected to transform the district.
According to the appraisal, there have been several recent developments in Downtown Detroit that are expected to have a positive long-term impact on the Downtown market, including Ford’s acquisition of Michigan Central Station in Corktown. Ford is in the process of developing a multi-billion dollar investment in autonomous-vehicle development in Corktown. Additionally, TCF Bank, formerly Chemical Bank, is constructing a new 20-story building downtown that is projected to add an additional 500 workers.
The appraiser identified four comparable office leases with rents ranging from $24.50 to $29.75 per square foot. Based on the identified lease comparables, the appraiser concluded market rents ranging between $26.50 and $29.50 per square foot for the seven office properties in the Bedrock Portfolio, generally in-line with underwritten base rents across the office component of the Bedrock Portfolio.
Office Lease Comparables(1) | |||||||||
Property | Address | Year Built | Building Size (SF) | Tenant Name | Size (SF) | Lease Start Date | Lease Term | Rent PSF | |
One Detroit Center | 500 Woodward Ave. | 1992 | 979,477 | DT Midstream | 22,727 | Nov-21 | 126 | $29.75 | |
Renaissance Center | 400 E. Jefferson Ave. | 1980 | 7,123,170 | Consulate of Italy | 4,133 | Mar-21 | 110 | $26.00 | |
Fisher Building | 3011 W. Grand Blvd. | 1928 | 634,819 | Strategic Staffing | 57,000 | Jan-21 | 120 | $24.50 | |
Hemmeter Building | 230 E. Grand River Ave. | 1913 | 56,203 | UHY | 7,156 | Sep-20 | 60 | $25.00 | |
Total / Wtd. Avg. | 1945 | 2,198,417 | 22,754 | Mar-21 | 116 | $25.92 | |||
Bedrock Portfolio Office Tenants | $25.26 | ||||||||
(1) | Bedrock Portfolio Office Tenants Rent PSF is based on the underwritten rent roll dated November 10, 2021. |
COVID-19 Update. As of February 1, 2022, the Bedrock Portfolio Properties are open and operating. No tenants are currently subject to rent abatements in connection with COVID-19. As of February 1, 2022, the Bedrock Portfolio Whole Loan is not subject to any modification or forbearance requests. The first payment date is scheduled for February 1, 2022. See “Risk Factors—Special Risks—The Coronavirus Pandemic Has Adversely Affected the Global Economy and Will Likely Adversely Affect the Performance of the Mortgage Loans” in the Preliminary Prospectus.
Office and Retail Historical and Current Occupancy(1) | |||||
2016 | 2017 | 2018 | 2019 | 2020 | Current(2) |
82.5% | 81.5% | 85.0% | 88.9% | 92.4% | 88.7% |
(1) | Historical occupancies are as of December 31 of each respective year. |
(2) | Current Occupancy is based on the underwritten rent roll as of November 10, 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.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Bedrock Portfolio |
Office and Retail Tenant Summary(1) | ||||||||
Tenant | Tenant Type | Ratings Moody’s/S&P/Fitch(2) | Net Rentable Area (SF) | % of Total NRA | Base Rent PSF | % of Total Base Rent | Lease Expiration Date | Renewal Options |
Quicken Loans Inc.(3) | Office | NR/NR/NR | 905,935 | 33.6% | $26.04 | 39.5% | Various | Various |
Amrock, Inc | Office | NR/NR/NR | 424,486 | 15.8% | $23.50 | 16.7% | 1/31/2032 | 2, 5-Year |
Honigman Miller Schwartz and Cohn LLP | Office | NR/NR/NR | 150,786 | 5.6% | $26.50 | 6.7% | 11/30/2025 | 2, 5-Year |
LinkedIn Corporation | Office | Aaa/AAA/AAA | 74,497 | 2.8% | $31.53 | 3.9% | 7/31/2026 | 1, 5-Year |
Coyote Logistics | Office | A2/A-/NR | 58,192 | 2.2% | $29.25 | 2.9% | 10/31/2030 | 1, 5-Year |
Kitch Drutchas Wagner Valitutti & Sherbrook, P.C. | Office | NR/NR/NR | 56,265 | 2.1% | $27.17 | 2.6% | 5/31/2028 | 1, 5-Year |
Board of Trustees of Michigan State University | Office | NR/NR/NR | 46,598 | 1.7% | $28.84 | 2.3% | 9/30/2031 | 2, 1-Year |
Bedrock Management Services LLC | Office | NR/NR/NR | 39,087 | 1.5% | $26.81 | 1.8% | 1/31/2032 | 1, 5-Year |
JPMorgan Chase, National Association | Office | A2/A-/AA- | 32,126 | 1.2% | $29.13 | 1.6% | 5/31/2027 | 1, 5-Year |
Fifth Third Bank | Office | Baa1/BBB+/A- | 31,204 | 1.2% | $24.80 | 1.3% | 10/31/2025 | 1, 5-Year |
Ten Largest Tenants | 1,819,176 | 67.5% | $25.97 | 79.2% | ||||
Remaining Occupied Office Tenants | 461,647 | 17.1% | $22.47 | 17.4% | ||||
Remaining Occupied Retail Tenants | 110,225 | 4.1% | $18.48 | 3.4% | ||||
Total Occupied | 2,391,048 | 88.7% | $24.95 | 100.0% | ||||
Vacant | 303,579 | 11.3% | ||||||
Total / Wtd. Avg. | 2,694,627 | 100.0% |
(1) | Based on the underwritten rent roll dated November 10, 2021. |
(2) | In certain instances, ratings provided are those of the parent company of the entity shown, whether or not the parent company guarantees the lease. |
(3) | Quicken Loans Inc. has various Lease Expiration Dates, including (i) 183,664 square feet expiring in August 2023 for which it has two, five-year renewal options, (ii) 122,475 square feet expiring in April 2024 for which it has three, three-year renewal options, (iii) 407,050 square feet expiring in July 2028 for which it has two, five-year renewal options, (iv) 21,124 square feet expiring in January 2030 for which it has two, five-year renewal options and (v) 156,020 square feet expiring in March 2032 for which it has, two, five-year renewal options. Quicken Loans Inc. has no remaining termination options. |
Office and Retail Lease Rollover Schedule(1)(2) | |||||||||
Year | Number of Leases Expiring | Net Rentable Area Expiring | % of NRA Expiring | Base Rent Expiring | % of Base Rent Expiring | Cumulative NRA Expiring | Cumulative % of NRA Expiring | Cumulative Base Rent Expiring | Cumulative % of Base Rent Expiring |
Vacant | NAP | 303,579 | 11.3% | NAP | NAP | 303,579 | 11.3% | NAP | NAP |
2022 & MTM | 44 | 146,690 | 5.4% | $3,246,316 | 5.4% | 450,269 | 16.7% | $3,246,316 | 5.4% |
2023 | 16 | 304,272 | 11.3% | 7,252,186 | 12.2% | 754,541 | 28.0% | $10,498,502 | 17.6% |
2024 | 18 | 200,069 | 7.4% | 5,784,259 | 9.7% | 954,610 | 35.4% | $16,282,761 | 27.3% |
2025 | 15 | 258,173 | 9.6% | 6,687,343 | 11.2% | 1,212,783 | 45.0% | $22,970,104 | 38.5% |
2026 | 11 | 142,573 | 5.3% | 4,271,955 | 7.2% | 1,355,356 | 50.3% | $27,242,059 | 45.7% |
2027 | 7 | 76,383 | 2.8% | 1,493,570 | 2.5% | 1,431,739 | 53.1% | $28,735,629 | 48.2% |
2028 | 3 | 463,315 | 17.2% | 12,537,526 | 21.0% | 1,895,054 | 70.3% | $41,273,155 | 69.2% |
2029 | 1 | 3,536 | 0.1% | 97,240 | 0.2% | 1,898,590 | 70.5% | $41,370,395 | 69.3% |
2030 | 2 | 79,316 | 2.9% | 2,329,710 | 3.9% | 1,977,906 | 73.4% | $43,700,105 | 73.3% |
2031 | 1 | 46,598 | 1.7% | 1,343,886 | 2.3% | 2,024,504 | 75.1% | $45,043,991 | 75.5% |
2032 & Thereafter | 4 | 670,123 | 24.9% | 14,612,316 | 24.5% | 2,694,627 | 100.0% | $59,656,307 | 100.0% |
Total | 122 | 2,694,627 | 100.0% | $59,656,307 | 100.0% |
(1) | Based on the underwritten rent roll dated November 10, 2021. |
(2) | Certain tenants may have termination or contraction options (which may become exercisable prior to the originally stared expiration date of the tenant lease) that are not considered in the above Office and Retail Lease Rollover Schedule. |
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.
32 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Bedrock Portfolio |
Operating History and Underwritten Net Cash Flow(1) | |||||||
2018 | 2019 | 2020 | TTM September 2021 | Underwritten(1) | Per Square Foot | % | |
Rents In Place(2) | $49,546,085 | $52,751,303 | $57,994,616 | $60,138,958 | $59,656,311 | $22.14 | 70.4% |
Vacant Income | 0 | 0 | 0 | 0 | 7,501,625 | 2.78 | 8.9% |
Gross Potential Rent | $49,546,085 | $52,751,303 | $57,994,616 | $60,138,958 | $67,157,936 | $24.92 | 79.3% |
Total Reimbursements | 12,917,725 | 14,066,069 | 13,108,393 | 11,943,224 | 17,559,733 | 6.52 | 20.7% |
Gross Potential Income | $62,463,811 | $66,817,372 | $71,103,009 | $72,082,182 | $84,717,669 | $31.44 | 100.0% |
Vacancy/Credit Loss | (1,100,662) | (1,099,639) | (1,694,177) | (2,030,041) | (10,418,183) | (3.87) | (12.3%) |
Concessions | (89,423) | (49,389) | (45,615) | (44,800) | 0 | 0.00 | 0.0% |
Parking (Contractual) | 19,565,127 | 20,062,906 | 20,373,075 | 20,247,590 | 19,321,511 | 7.17 | 22.8% |
Parking (Transient) | 4,382,014 | 5,250,614 | 1,860,131 | 2,231,702 | 2,004,714 | 0.74 | 2.4% |
Other Income | 1,423,306 | 2,619,763 | 1,723,795 | 1,925,200 | 1,934,739 | 0.72 | 2.3% |
Effective Gross Income | $86,644,173 | $93,601,628 | $93,320,219 | $94,411,832 | $97,560,449 | $36.21 | 115.2% |
Total Expenses | 44,502,438 | 46,392,886 | 39,225,160 | 38,816,129 | 39,136,450 | 14.52 | 40.1% |
Net Operating Income | $42,141,735 | $47,208,742 | $54,095,059 | $55,595,704 | $58,423,999 | $21.68 | 59.9% |
TI/LC | 0 | 0 | 0 | 0 | 3,353,632 | 1.24 | 3.4% |
Capital Expenditures | 0 | 0 | 0 | 0 | 660,862 | 0.25 | 0.7% |
Net Cash Flow | $42,141,735 | $47,208,742 | $54,095,059 | $55,595,704 | $54,409,505 | $20.19 | 55.8% |
(1) | Based on underwritten rent roll dated November 10, 2021. |
(2) | Underwritten Rents in Place is inclusive of (i) contractual rent steps though December 2022 and (i) straight-line average rent over the lease term for investment grade rated tenants. |
Property Management. The Bedrock Portfolio Properties are currently managed by Bedrock Management Services LLC.
Escrows and Reserves. At loan origination, the Borrower deposited (i) $8,392,690 into an outstanding TI/LC reserve, (ii) approximately $1,696,002 into a real estate tax reserve, (iii) $477,905 into a free rent reserve, (iv) $280,690 into a rollover reserve, (v) $250,000 into an outstanding environmental reserve with respect to the 1700 W Fort Street individual property, (vi) $241,558 into a required repairs reserve and (vii) $62,336 into a replacement reserve.
Tax Reserve – On each monthly due date, the borrowers are required to deposit an amount equal to 1/12th of the estimated annual real estate taxes into the tax reserve account, which is estimated to be $424,000.
Insurance Reserve – On each monthly due date, the borrowers are required to deposit into an insurance reserve an amount equal to 1/12th of estimated insurance premiums, unless the borrower maintains a blanket policy in accordance with the Bedrock Portfolio Whole Loan documents.
Replacement Reserve – On each monthly due date, the borrowers are required to deposit $62,336 into a replacement reserve, subject to a cap of $1,469,568.
Rollover Reserve – On each monthly due date, the borrowers are required to deposit $280,690.
Lockbox / Cash Management. The Bedrock Portfolio Whole Loan is structured with an in place hard lockbox for commercial units, the office and mixed-use properties, a springing lockbox for one residential property and various parking properties and springing cash management. At loan origination, the borrowers were required to direct each tenant at a property subject to a hard lockbox to remit all rents directly to the applicable lockbox account. In addition, the borrowers are required to cause all cash revenues and all other money received by the borrowers or the property manager with respect to the properties subject to a hard lockbox to be deposited into the applicable lockbox account within one business day of receipt. On each business day on which no Cash Sweep Event (as defined below) is continuing, all amounts in the lockbox account are required to be remitted to a borrower-controlled operating account. Upon the occurrence of a Cash Sweep Event, (i) the borrowers are required to establish lockbox accounts for all properties, and (ii) the borrowers are required to establish a cash management account. On each business day during the continuance of a Cash Sweep Event, all amounts in each lockbox account are required to be remitted to the cash management account. On each due date during the continuance of a Cash Sweep Event, all funds on deposit in the cash management account after payment of debt service on the Bedrock Portfolio Whole Loan, required reserves and budgeted operating expenses are required to be deposited into an excess cash flow reserve account as additional collateral for the Bedrock Portfolio Whole Loan.
A “Cash Sweep Event” means (a) an event of default, (b) the bankruptcy or insolvency of the any of the borrowers or the property manager, or (c) if the debt service coverage ratio based on a trailing three month basis for the total debt falls below 2.50x.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
33 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Bedrock Portfolio |
A Cash Sweep Event may be cured upon the occurrence of the following: (i) with respect to clause (a) above, the acceptance by the lender of a cure of such event of default in accordance with the Bedrock Portfolio Whole Loan documents, (ii) with respect to clause (b) above solely with respect to the borrowers, if the bankruptcy action is an involuntary petition against such individual borrower and no individual borrower has colluded with, or otherwise assisted, such person, and has not solicited creditors for any involuntary petition against such individual borrower from any person and the bankruptcy action is dismissed within 90 days from the filing of such bankruptcy action, (iii) with respect to clause (b) above solely with respect to the property manager, if the applicable individual borrower replaces such property manager with a “Qualified Manager” (as fully described in the Bedrock Portfolio Whole Loan documents) under a replacement management agreement acceptable to the lender in accordance with the Bedrock Portfolio Whole Loan documents, or (iv) with respect to clause (c) above, if the debt service coverage ratio based on the trailing three-month period immediately preceding the date of such determination for two consecutive quarters is not less than 2.50x; provided, however, (A) no event of default has occurred and be continuing under the Bedrock Portfolio Whole Loan documents, (B) the borrowers have paid all of Lender’s reasonable expenses incurred in connection with such Cash Sweep Event Cure including reasonable attorney’s fees and expenses, and (C) in no event may the borrowers cure a Cash Sweep Event caused by a bankruptcy action caused by any of the borrowers filing a voluntary petition or arising from a person filing an involuntary petition against any of the borrowers and any such borrower has colluded with or otherwise assisted such person with the involuntary petition against the applicable borrower.
Current Mezzanine or Subordinate Indebtedness. None.
Future Mezzanine or Subordinate Indebtedness Permitted. None.
Partial Release. The Bedrock Portfolio Whole Loan documents permit the release of an individual property (each, an “Individual Property”) from the lien of the mortgage, provided no event of default has occurred and is continuing and upon satisfaction of certain conditions set forth in the Bedrock Portfolio Whole Loan documents, including, without limitation, the following: (a) the amount of the outstanding principal balance of the Loan to be prepaid must equal or exceed 115% of the allocated loan amount for such applicable Individual Property, (b) the resulting debt service coverage ratio for the remaining Property is equal to or greater than 3.10x, (c) unless the Individual Property to be released is subject to a non-monetary event of default that relates solely to such Individual Property and borrower has demonstrated in good faith that it has pursued a cure of the event of default, the Individual Property to be released is conveyed in an arm’s length transfer to a person other than the applicable individual borrower or any of its affiliates, and (d) upon release of the Individual Property, the customary REMIC rules are satisfied.
Ground Lease. The individual property identified as One Woodward is ground leased by the borrower, as the ground lessee, under a ground lease with Lawrence Edwin Burch Living Trust and related individuals who collectively comprise the ground lessor. The borrower assumed the ground lease in 2012, which expires in April 2040 with five, 25-year remaining extension options. The current rent is approximately $43,775 annually. The ground lessee’s interest in the ground lease is freely assignable to the leasehold mortgagee without the consent of the ground lessor and, in the event that it is so assigned, is further assignable by the leasehold mortgagee without the need to obtain the consent of the ground lessor. See “Description of the Mortgage Pool – Mortgage Pool Characteristics – Fee & Leasehold Estates; Ground Leases” in the Preliminary Prospectus for additional information.
Master Leases. Three individual properties, identified as Chase Tower, Chrysler House, and 1001 Woodward, are subject to a master leases that were originally entered into for the purpose of securing historic tax credit investors. None of the historic tax credit investors remain in the ownership of the master tenants, which are now wholly owned indirectly by Detroit Real Estate Holdings Company I LLC, which directly owns each of the borrowers. Each master tenant is required to comply with single purpose entity covenants in the Bedrock Portfolio Whole Loan documents, including having independent directors. Each master tenant granted the lender a mortgage and an assignment of leases and rents on its individual property.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
34 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Rosewood National Storage 13 |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
35 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Rosewood National Storage 13 |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
36 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Rosewood National Storage 13 |
Mortgage Loan Information | Property Information | |||
Mortgage Loan Seller: | GACC | Single Asset / Portfolio: | Portfolio | |
Original Principal Balance: | $108,575,000 | Title: | Fee | |
Cut-off Date Principal Balance: | $108,575,000 | Property Type - Subtype: | Self - Storage | |
% of Pool by IPB: | 6.1% | Net Rentable Area (SF): | 1,564,651 | |
Loan Purpose: | Acquisition | Location(1): | Various | |
Borrower: | RPC Storage 13 Portfolio, LLC | Year Built / Renovated(1): | Various / Various | |
Guarantor: | RPC Reliance, LLC | Occupancy: | 95.5% | |
Interest Rate: | 3.04900% | Occupancy Date: | 9/30/2021 | |
Note Date: | 12/16/2021 | Number of Tenants: | N/A | |
Maturity Date: | 1/6/2032 | Fourth Most Recent NOI(3): | NAV | |
Interest-only Period: | 120 months | Third Most Recent NOI: | $8,815,991 (December 31, 2019) | |
Original Term: | 120 months | Second Most Recent NOI: | $8,540,410 (December 31, 2020) | |
Original Amortization: | None | Most Recent NOI: | $10,195,139 (TTM October 31, | |
Amortization Type: | Interest Only | 2021) | ||
Call Protection: | L(25),D(91),O(4) | UW Economic Occupancy: | 94.3% | |
Lockbox / Cash Management: | Springing / Springing | UW Revenues: | $15,796,582 | |
Additional Debt: | N/A | UW Expenses: | $5,122,665 | |
Additional Debt Balance: | N/A | UW NOI: | $10,673,917 | |
Additional Debt Type: | N/A | UW NCF: | $10,502,488 | |
Appraised Value / Per SF(3): | $181,940,000 / $116 | |||
Appraisal Date: | Various | |||
Escrows and Reserves(4) | Financial Information | |||||||
Initial | Monthly | Initial Cap | Cut-off Date Loan / SF: | $69 | ||||
Taxes: | $166,821 | $110,764 | N/A | Maturity Date Loan / SF: | $69 | |||
Insurance: | $0 | Springing | N/A | Cut-off Date LTV(2): | 59.7% | |||
Replacement Reserves: | $0 | $0 | N/A | Maturity Date LTV(2): | 59.7% | |||
TI/LC: | $0 | $0 | N/A | UW NCF DSCR: | 3.13x | |||
Other: | $405,121 | Springing | N/A | UW NOI Debt Yield: | 9.8% | |||
Sources and Uses | ||||||
Sources | Proceeds | % of Total | Uses | Proceeds | % of Total | |
Mortgage Loan | $108,575,000 | 59.7% | Purchase Price | $180,907,000 | 99.4% | |
Sponsor Equity | 73,518,344 | 40.4 | Closing Costs | 614,402 | 0.3 | |
Upfront Reserves | 571,942 | 0.3 | ||||
Total Sources | $182,093,344 | 100.0% | Total Uses | $182,093,344 | 100.0% |
(1) | See “Portfolio Summary & Unit Mix” table herein. |
(2) | The Fourth Most Recent NOI is unavailable due to the Rosewood National Storage 13 Portfolio being an acquisition. |
(3) | The Appraised Value is based on the “As Portfolio” value, which assumes the Rosewood Nation Storage 13 Properties are sold together. The sum of the individual appraised values is $178,750,000, which equates to a Cut-off Date LTV and Maturity Date LTV of 60.7%. |
(4) | For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” herein. |
The Loan. The Rosewood National Storage 13 loan (the “Rosewood National Storage 13 Loan”) is secured by a first mortgage lien on the borrower’s fee interests in a portfolio of 13 self-storage properties comprised of 10,616 storage and non-storage units totaling 1,564,651 square feet across 10 states (collectively, the “Rosewood National Storage 13 Portfolio” or “Rosewood National Storage 13 Properties”). The Rosewood National Storage 13 Loan accrues interest at an interest rate of 3.04900% per annum, had an original term of 120 months, has a remaining term of 119 months as of the Cut-off Date, and is interest only for the entire term.
The Borrower. The borrowing entity for the Rosewood National Storage 13 Loan is RPC Storage 13 Portfolio, LLC, a Delaware limited liability company and special purpose entity, with two independent directors in its organizational structure. Legal counsel to the borrower delivered a non-consolidation opinion in connection with the origination of the Rosewood National Storage 13 Loan.
The Loan Sponsor. The loan sponsor is Rosewood Property Company (“RPC”) and the non-recourse carveout guarantor is RPC Reliance, LLC, which is wholly owned by, and an affiliate of, RPC. RPC is a Dallas-based real estate investment vehicle for The Rosewood Corporation, which is wholly owned by the Caroline Hunt Trust Estate. RPC has been involved in the development, investment and operation of real estate for over 40 years. In addition to RPC’s self-storage portfolio, the company has investments in multi-family, office,
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Rosewood National Storage 13 |
industrial, retail and land as well as private equity real estate funds. RPC currently owns approximately 72 self-storage properties containing approximately 42,500 units and 5.6 million square feet.
The Property. The Rosewood National Storage 13 Portfolio consists of 13 self-storage assets located in in Connecticut, Florida, Georgia, Indiana, Kentucky, Missouri, New Mexico, Ohio, South Carolina, and Texas. The Rosewood National Storage 13 Properties were built between 1971 and 2008 and are situated on approximately 97 acres and include 124 buildings. The Rosewood National Storage 13 Portfolio encompasses 10,616 total units totaling 1,564,651 square feet, which include 9,458 enclosed self-storage units totaling 1,143,064 square feet and 1,158 non-storage units totaling 421,587 square feet. The enclosed self-storage segment includes three unit types: non-climate-controlled units, climate-controlled units, and storage lockers. The non-storage units include uncovered surface parking spaces, covered parking spaces, office spaces, and one warehouse unit. The Rosewood National Storage 13 Portfolio also includes two cell towers. As of September 30, 2021, the self-storage segment was 96.0% occupied, and the non-storage segment was 94.2% occupied, which equates to an overall occupancy of 95.5%. Ten of the Rosewood National Storage 13 Properties are managed by Extra Space Management Inc. (“Extra Space”) and three are managed by CubeSmart Asset Management, LLC (“CubeSmart”).
The following table presents certain information relating to the Rosewood National Storage 13 Properties:
Portfolio Summary & Unit Mix(1) | |||||||||
Property Name | City/State | Allocated Cut-off Date Loan Amount | % of ALA | Appraised Value(2) | Year Built/Renovated | Total Units | Storage NRA | Non-Storage NRA | Total NRA |
Tallahassee | Tallahassee, FL | $18,090,600 | 16.7% | $29,300,000 | 1979-1987/NAP | 1,608 | 183,264 | 8,700 | 191,964 |
Fort Worth | Fort Worth, TX | $15,905,600 | 14.6% | $26,890,000 | 1976/NAP | 1,412 | 103,565 | 189,787 | 293,352 |
Kemah | Kemah, TX | $14,932,300 | 13.8% | $26,300,000 | 1977/NAP | 1,378 | 231,900 | 72,470 | 304,370 |
North Charleston | North Charleston, SC | $8,395,700 | 7.7% | $14,000,000 | 1974/1991 | 738 | 63,459 | 103,980 | 167,439 |
Groton | Groton, CT | $7,995,700 | 7.4% | $14,000,000 | 2003/NAP | 606 | 61,100 | 800 | 61,900 |
Albuquerque | Albuquerque, NM | $7,360,100 | 6.8% | $12,920,000 | 1984/NAP | 833 | 71,045 | 0 | 71,045 |
Augusta | Augusta, GA | $5,889,000 | 5.4% | $9,520,000 | 2000/NAP | 597 | 80,979 | 5,000 | 85,979 |
Grandview | Grandview, MO | $5,519,400 | 5.1% | $8,620,000 | 1986/NAP | 555 | 67,055 | 4,320 | 71,375 |
Louisville | Louisville, KY | $5,241,400 | 4.8% | $8,490,000 | 1980/NAP | 842 | 81,968 | 19,500 | 101,468 |
Houston | Houston, TX | $5,093,700 | 4.7% | $7,500,000 | 2008/NAP | 514 | 66,551 | 4,250 | 70,801 |
Greenwood | Greenwood, IN | $4,953,800 | 4.6% | $6,930,000 | 1980/NAP | 431 | 45,834 | 0 | 45,834 |
Miami | Miami, FL | $4,937,600 | 4.5% | $8,010,000 | 1971/NAP | 672 | 32,812 | 0 | 32,812 |
Kent | Kent, OH | $4,260,100 | 3.9% | $6,270,000 | 1988/NAP | 430 | 53,532 | 12,780 | 66,312 |
Total / Wtd. Avg. | $108,575,000 | 100.0% | $178,750,000 | 10,616 | 1,143,064 | 421,587 | 1,564,651 |
(1) | Based on the rent roll dated September 30, 2021. |
(2) | The appraisal concluded to an “As Portfolio” value of $181,940,000. |
Unit Mix - Self Storage(1) | |||||||
Unit Type | # of Units | Occupancy | Total SF | Avg Unit SF | Avg Rent per Unit | Avg Rent PSF | Base Rent |
Non-Climate Controlled Storage | 7,317 | 95.5% | 934,220 | 128 | $130 | $1.00 | $10,740,488 |
Climate-Controlled Storage | 1,871 | 98.2% | 200,084 | 107 | $136 | $1.26 | $2,976,496 |
Locker | 270 | 100.0% | 8,760 | 32 | $33 | $1.02 | $107,424 |
Total / Wtd. Avg. | 9,458 | 96.0% | 1,143,064 | 121 | $128 | $1.06 | $13,824,408 |
(1) Based on the rent roll dated September 30, 2021. | |||||||
Unit Mix - Non-Self Storage(1) | |||||||
Unit Type | # of Units | Occupancy | Total SF | Avg Unit SF | Avg Rent per Unit | Avg Rent PSF | Base Rent |
Surface Parking | 675 | 91.7% | 218,457 | 324 | $88 | $0.27 | $648,893 |
Covered Parking | 466 | 97.2% | 192,440 | 413 | $164 | $0.40 | $890,850 |
Office | 16 | 91.1% | 9,390 | 587 | $440 | $0.72 | $73,909 |
Warehouse | 1 | 100.0% | 1,300 | 1,300 | $450 | $0.35 | $5,400 |
Total / Wtd. Avg. | 1,158 | 94.2% | 421,587 | 364 | $125 | $0.34 | $1,619,052 |
(1) | Based on the rent roll dated September 30, 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.
38 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Rosewood National Storage 13 |
COVID-19 Update. As of December 16, 2021, the Rosewood National Storage 13 Properties are open and operating. There has been no material rent relief requested. The Rosewood National Storage 13 Loan is not subject to any modification or forbearance requests. The first payment date under the Rosewood National Storage 13 Loan documents is in February 2022.
The Market. The Rosewood National Storage 13 Portfolio is comprised of 13 geographically diverse properties across 10 different states. Texas (33.1%) and Florida (21.2%) represent the largest concentration of the Rosewood National Storage 13 Portfolio by allocated loan amount. No other state accounts for more than 7.7% of the Rosewood National Storage 13 Loan by allocated loan amount, or more than 10.7% of the total square feet.
The following table presents market demographic information relating to the Rosewood National Storage 13 Portfolio:
Demographic Summary(1) | |||||||||||
Property Name | City/State | 1-mile Population | 3-mile Population | 5-mile Population | 1-mile Avg. Household Income | 3-mile Avg. Household Income | 5-mile Avg. Household Income | Market Vacancy | Market Rent per SF | ||
Tallahassee | Tallahassee, FL | 8,189 | 56,590 | 137,816 | $72,014 | $85,236 | $80,037 | 10.0% | $1.07 | ||
Fort Worth | Fort Worth, TX | 7,657 | 88,416 | 190,805 | $68,795 | $71,875 | $85,553 | 5.0% | $1.11 | ||
Kemah | Kemah, TX | 7,936 | 60,778 | 128,519 | $140,144 | $130,782 | $117,006 | 8.0% | $0.86 | ||
North Charleston | North Charleston, SC | 5,200 | 62,527 | 145,849 | $62,592 | $66,190 | $72,522 | 6.0% | $1.21 | ||
Groton(2) | Groton, CT | 6,520 | 83,003 | 148,167 | $81,981 | $85,399 | $96,832 | 6.0% | $1.56 | ||
Albuquerque | Albuquerque, NM | 14,941 | 114,539 | 216,547 | $63,362 | $61,754 | $69,948 | 8.0% | $1.30 | ||
Augusta | Augusta, GA | 5,802 | 38,445 | 83,337 | $62,344 | $57,328 | $56,535 | 6.0% | $0.94 | ||
Grandview | Grandview, MO | 6,500 | 33,405 | 94,803 | $61,077 | $64,865 | $75,922 | 5.0% | $0.96 | ||
Louisville | Louisville, KY | 8,531 | 54,604 | 197,795 | $47,942 | $55,702 | $67,423 | 10.% | $0.87 | ||
Houston | Houston, TX | 18,628 | 130,842 | 258,498 | $70,734 | $77,550 | $80,186 | 5.0% | $1.01 | ||
Greenwood | Greenwood, IN | 11,839 | 84,299 | 193,797 | $55,896 | $73,295 | $82,963 | 6.0% | $1.05 | ||
Miami | Miami, FL | 18,425 | 201,772 | 524,196 | $59,133 | $59,615 | $64,920 | 5.0% | $1.88 | ||
Kent | Kent, OH | 3,384 | 45,543 | 110,716 | $68,248 | $76,222 | $83,632 | 8.0% | $1.04 | ||
(1) | Source: Appraisal. |
(2) | The Groton property’s population and household income data are based on a 1, 5 and 10-mile radius. |
Operating History and Underwritten Net Cash Flow | ||||||
2019 | 2020 | TTM 10/31/2021 | Underwritten(1) | Per Square Foot | %(2) | |
Base Rent | $12,900,444 | $12,687,694 | $14,181,133 | $15,610,230 | $9.98 | 106.0% |
Bad Debt/Collection Loss | 311,773 | 356,046 | 332,330 | 365,820 | $0.23 | 2.5% |
Concessions | 451,453 | 397,082 | 473,978 | 521,743 | $0.33 | 3.5% |
Net Rental Income | $12,137,219 | $11,934,566 | $13,374,825 | $14,722,667 | $9.41 | 100.0% |
Other Income(3) | 869,490 | 743,918 | 816,971 | 994,701 | $0.64 | 6.8% |
Commercial Income | 106,119 | 93,234 | 84,365 | 79,214 | $0.05 | 0.5% |
Effective Gross Income | $13,112,828 | $12,771,718 | $14,276,162 | $15,796,582 | $10.10 | 107.3% |
Total Expenses | 4,296,836 | 4,231,308 | 4,081,023 | $5,122,665 | $3.27 | 32.4% |
Net Operating Income | $8,815,991 | $8,540,410 | $10,195,139 | $10,673,917 | $6.82 | 67.6% |
Total TI/LC, CapEx | 0 | 0 | 0 | 171,430 | $0.11 | 1.1% |
Net Cash Flow | $8,815,991 | $8,540,410 | $10,195,139 | $10,502,488 | $6.71 | 66.5% |
(1) | Underwritten base rent is based on the trailing three-month annualized in-place base rent ending October 31, 2021, which equates to $15,610,230. |
(2) | % column represents percent of Net Rental Income for all revenue lines and represents percent of Effective Gross Income for the remainder of the fields. |
(3) | Other Income includes tenant insurance revenue associated with the three CubeSmart managed properties. The borrower agreed to pay CubeSmart a higher management fee (5.0%) in exchange for receiving 50% of tenant insurance revenues. |
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Rosewood National Storage 13 |
Escrows and Reserves. At loan origination, the borrower deposited with the lender (i) a deferred maintenance reserve in the amount of $405,121 and (ii) a real estate tax reserve in the amount of approximately $166,821.
Tax Reserve – On each monthly payment date, the borrower is required to deposit into a real estate tax reserve, 1/12th of the amount that the lender estimates will be necessary to pay real estate taxes over the then succeeding 12-month period (initially estimated at approximately $110,764).
Insurance Reserve – On each monthly payment date, the borrower is required to deposit into an insurance reserve, 1/12th of the amount that the lender estimates will be necessary to cover premiums over the then succeeding 12-month period. The borrower’s obligation to make monthly deposits into the insurance reserve is waived so long as the borrower has provided satisfactory evidence that all insurance premiums have been paid with respect to an acceptable blanket insurance policy. As of the origination date, an acceptable blanket policy was in place.
Expansion Deposit Reserve – The borrower is required to deposit any Expansion Deposit Amounts (as defined below) into the Expansion Deposit reserve.
Lockbox / Cash Management. The Rosewood National Storage 13 Loan is structured with a springing lockbox and springing cash management. Upon the first occurrence of a Lockbox Trigger Event (as defined below), the borrower is required to establish a clearing account at a bank approved by the lender to be maintained by the borrower. Upon the occurrence of a Lockbox Trigger Event, and at all times thereafter, the borrower is required to cause (x) all gross revenues relating to leases (other than leases that demise space solely for self-storage purposes) to be deposited directly by the applicable tenant into the clearing account and (y) all other gross revenues to be deposited in the clearing account within one business day of receipt by the borrower or the manager. From and after a Lockbox Trigger Event, (i) during a Trigger Period (as defined below), a deposit account controlled by the lender is required to be established and funds deposited into the clearing account are required to be swept on a daily basis into such deposit account and (ii) if a Trigger Period is not continuing funds deposited into the clearing account will be swept by the clearing bank on a daily basis into borrower’s operating account at the clearing bank.
A “Lockbox Trigger Event” means (i) the occurrence of an event of default or (ii) the debt service coverage ratio is less than 1.15x as of any calendar quarter.
A “Trigger Period” means a period commencing (i) upon the occurrence of an event of default, (ii) upon the commencement of a Low Debt Service Period (as defined below) and (iii) if the manager or non-recourse carveout guarantor becomes insolvent or a debtor in any bankruptcy or insolvency proceeding and ending, if, (A) with respect to a Trigger Period continuing pursuant to clause (i), the event of default commencing the Trigger Period has been cured and such cure has been accepted by the lender, (B) with respect to a Trigger Period continuing due to clause (ii), the Low Debt Service Period has been cured as provided in the definition of such term, or (C) with respect to a Trigger Period continuing due to clause (iii), if the manager is replaced with an unaffiliated qualified manager approved by the lender under a replacement management agreement approved by the lender.
A “Low Debt Service Period” means the debt service coverage ratio is less than 1.10x as of the last day of each calendar quarter and is cured upon the achievement of a 1.15x debt service coverage ratio as of any calendar quarter.
Property Management. The Rosewood National Storage 13 Portfolio is managed by CubeSmart as to the properties located in (i) Augusta, Georgia, (ii) Tallahassee, Florida, and (iii) Groton, Connecticut and Extra Space as to the remaining Rosewood National Storage 13 Properties.
Current Mezzanine or Subordinate Indebtedness. None.
Future Mezzanine or Secured Subordinate Indebtedness Permitted. None.
Partial Release. On any business day after the defeasance lockout expiration date, the borrower has the right to obtain the release of one or more of the individual Rosewood National Storage 13 Properties (each an “Individual Property”) in connection with a sale to a bona fide third party purchaser, upon defeasance of an amount equal to 120% of the allocated loan amount of the Individual Property or Individual Properties to be released, and satisfaction of the following conditions, among others, (i) after giving effect to the release, the debt service coverage ratio of the remaining Rosewood National Storage 13 Properties is not less than the greater of 1.78x and the debt service coverage ratio immediately prior to the release, (ii) after giving effect to the release, the loan-to-value ratio of the remaining Rosewood National Storage 13 Properties is not greater than the lesser of 59.7% and the loan-to-value ratio immediately prior to the release, and (iii) satisfaction of REMIC related requirements.
Future Expansion. The borrower may expand any building, or build a new building on any Individual Property, subject to the lender’s approval, in its sole, but good faith discretion, and satisfaction of the following conditions, among others, (i) delivery of the applicable plans and specifications, budget, and all related construction contracts, all acceptable to the lender, (ii) delivery of evidence acceptable to the lender that all required licenses, consents, approvals and permits have been obtained for such expansion and such expansion
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Rosewood National Storage 13 |
does not violate any legal requirements or any agreement affecting the applicable Individual Property, (iii) no indebtedness is incurred in connection with the expansion other than permitted indebtedness, (iv) compliance with REMIC related requirements, and (v) delivery of security (in the form of cash, a letter of credit, United States government obligations or other securities acceptable to the lender) for payment of the cost of such expansion in an amount equal to 110% of the total cost of such expansion (the “Expansion Deposit Amounts”); provided, however, such security is not required if the cost of the applicable expansion (together with the cost of any other alterations currently taking place at such Individual Property) is less than 25% of the allocated loan amount of such Individual Property, and the aggregate cost of all expansions and other alterations then occurring across all Rosewood National Storage 13 Properties is less than 5% of the total amount of the Rosewood National Storage 13 Loan. If such security as set forth in clause (v) above is required, the same is required to be held by the lender in a reserve and disbursed subject to the same conditions as a customary ongoing capital expenditure reserve.
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
CX – 350 & 450 Water Street |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
42 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
CX – 350 & 450 Water Street |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
43 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
CX – 350 & 450 Water Street |
Mortgage Loan Information | Property Information | |||
Mortgage Loan Seller(1): | GACC | Single Asset / Portfolio: | Single Asset | |
Original Principal Balance(2): | $101,000,000 | Title: | Fee | |
Cut-off Date Principal Balance(2): | $101,000,000 | Property Type - Subtype: | Mixed Use – Office/Lab | |
% of Pool by IPB: | 5.7% | Net Rentable Area (SF): | 915,233 | |
Loan Purpose: | Refinance | Location: | Cambridge, MA | |
Borrowers: | DW PropCo G, LLC and DW | Year Built / Renovated: | 2021 / NAP | |
PropCo H, LLC | Occupancy: | 100.0% | ||
Guarantor: | None | Occupancy Date: | 10/14/2021 | |
Interest Rate(3): | 2.79200% | Number of Tenants: | 1 | |
Note Date: | 10/14/2021 | Fourth Most Recent NOI: | NAV | |
Anticipated Repayment Date(3): | 11/6/2031 | Third Most Recent NOI: | NAV | |
Maturity Date(3): | 11/6/2036 | Second Most Recent NOI: | NAV | |
Interest-only Period: | 120 months | Most Recent NOI: | NAV | |
Original Term(3): | 120 months | UW Economic Occupancy: | 98.5% | |
Original Amortization: | None | UW Revenues: | $92,929,288 | |
Amortization Type: | Interest Only - ARD | UW Expenses: | $12,225,756 | |
Call Protection: | L(24),YM1(3),DorYM1(86),O(7) | UW NOI: | $80,703,532 | |
Lockbox / Cash Management: | Hard / Springing | UW NCF: | $80,566,247 | |
Additional Debt(2): | Yes | Appraised Value / Per SF(4): | $1,954,000,000 / $2,135 | |
Additional Debt Balance(2): | $713,000,000 / $411,000,000 | Appraisal Date(4): | 4/1/2023 | |
Additional Debt Type(2): | Pari Passu / Subordinate | |||
|
Escrows and Reserves(5) | Financial Information(2) | |||||||
Initial | Monthly | Initial Cap | Senior Notes | Whole Loan | ||||
Taxes: | $0 | Springing | N/A | Cut-off Date Loan / SF: | $889 | $1,338 | ||
Insurance: | $0 | Springing | N/A | Maturity Date Loan / SF(3): | $889 | $1,338 | ||
Replacement Reserves: | $0 | $0 | N/A | Cut-off Date LTV: | 41.7% | 62.7% | ||
TI/LC: | $52,062,079 | Springing | N/A | Maturity Date LTV(3): | 41.7% | 62.7% | ||
Other(6): | $97,383,122 | $0 | N/A | UW NCF DSCR: | 3.50x | 2.32x | ||
UW NOI Debt Yield: | 9.9% | 6.6% | ||||||
Sources and Uses | ||||||
Sources | Proceeds | % of Total | Uses | Proceeds | % of Total | |
Senior Notes | $814,000,000 | 66.4% | Purchase Price | $617,846,136 | 50.4% | |
Junior Notes | 411,000,000 | 33.6 | Principal Equity Distribution | 451,939,763 | 36.9_ | |
Upfront Reserves | 149,445,201 | 12.2 | ||||
Closing Costs | 5,768,900 | 0.5 | ||||
Total Sources | $1,225,000,000 | 100.0% | Total Uses | $1,225,000,000 | 100.0% |
(1) | The CX - 350 & 450 Water Street Whole Loan (as defined below) was co-originated by DBR Investments Co. Limited, JPMorgan Chase Bank, National Association, Bank of America, N.A. (“BANA”) and 3650 Cal Bridge Lending, LLC. GACC will be contributing Notes A-1-5, A-1-6 and A-1-8 to the Benchmark 2022-B32 transaction. |
(2) | The CX - 350 & 450 Water Street Loan (as defined below) is part of a whole loan evidenced by 20 senior pari passu notes, with an aggregate outstanding principal balance as of the Cut-off Date of $814.0 million (the “CX - 350 & 450 Water Street Senior Notes”) and four pari passu subordinate notes with an aggregate outstanding principal balance as of the Cut-off Date of $411.0 million. The Financial Information in the chart above reflects the Cut-off Date Balances of the CX - 350 & 450 Water Street Senior Notes and the CX - 350 & 450 Water Street Whole Loan, respectively. |
(3) | The CX - 350 & 450 Water Street Whole Loan is structured with an Anticipated Repayment Date (“ARD”) of November 6, 2031 and a final maturity date of November 6, 2036. The initial interest rate for the CX – 350 & 450 Water Street Whole Loan is 2.79200% per annum. After the ARD, the interest rate will increase by 2.00000% over the greater of (x) 2.79200%, and (y) (1) the swap rate in effect on the ARD plus (2) 1.26000%. The metrics presented above are calculated based on the ARD. |
(4) | Based on the “Prospective Market Value Upon Completion & Stabilization” appraised value of $1,954,000,000 as of April 1, 2023, which assumes that the outstanding capital expenditure of approximately $56,000,000 for 350 Water Street (as defined below) and $80,000,000 for 450 Water Street (as defined below) are fully funded and reserved by the lender, and that these reserved funds would pass with title to any purchaser of the CX – 350 & 450 Water Street Property (as defined below). The appraisal concluded to an “as-is” appraised value of $1,778,000,000 as of September 8, 2021. The “as-is” appraised value results in a Cut-off Date LTV Ratio and Maturity Date LTV Ratio of 45.8% for the CX - 350 & 450 Water Street Senior Notes (as defined below), and a Cut-off Date LTV Ratio and Maturity Date LTV Ratio of 68.9% for the CX - 350 & 450 Water Street Whole Loan (as defined below). The appraisal concluded to an aggregate “as dark” appraised value of $1,901,000,000. The “as dark” appraised value results in a Cut-off Date LTV Ratio and Maturity Date LTV Ratio of 42.8% for the CX - 350 & 450 Water Street Senior Notes, and a Cut-off Date LTV Ratio and Maturity Date LTV Ratio of 64.4% for the CX - 350 & 450 Water Street Whole Loan. |
(5) | For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below. |
(6) | Other upfront reserve includes a Base Building Work Reserve of approximately $86,650,891 and an Aventis Rent Reserve of approximately $10,732,231. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
CX – 350 & 450 Water Street |
The Loan. The CX - 350 & 450 Water Street mortgage loan (the “CX - 350 & 450 Water Street Loan”) is part of a whole loan with an aggregate outstanding principal balance as of the Cut-off Date of $1.225 billion (the “CX - 350 & 450 Water Street Whole Loan”) consisting of 20 senior pari passu notes with an aggregate outstanding principal balance as of the Cut-off Date of $814.0 million and four junior pari passu notes with an aggregate outstanding principal balance as of the Cut-off Date of $411.0 million. The CX - 350 & 450 Water Street Whole Loan is secured by the borrowers’ fee interest in two life sciences laboratory and office buildings totaling 915,233 square feet located in Cambridge, Massachusetts (the “CX - 350 & 450 Water Street Property”). The non-controlling Notes A-1-5, A-1-6 and A-1-8, with an aggregate outstanding principal balance as of the Cut-off Date of $101.0 million, will be included in the Benchmark 2022-B32 trust. The remaining notes have been, or are expected to be, contributed to one or more future securitization trusts or may otherwise be transferred at any time. The CX – 350 & 450 Water Street Whole Loan is serviced under the CAMB 2021-CX2 pooling and servicing agreement.
The CX - 350 & 450 Water Street Whole Loan accrues interest at the rate of 2.79200% per annum through the ARD. After the ARD, through and including November 6, 2036, the following structure will apply: the interest rate will increase (such new rate, the “Adjusted Interest Rate”) by 2.00000% over the greater of (x) 2.79200%, and (y)(1) the swap rate in effect on the ARD plus (2) 1.26000%; however, interest accrued at the excess of the Adjusted Interest Rate over the initial interest rate will be deferred as described below under “Lockbox / Cash Management.” The CX - 350 & 450 Water Street Whole Loan has an initial term to the ARD of 120 months and has a remaining term to the ARD of 117 months as of the Cut-off Date. The CX - 350 & 450 Water Street Whole Loan requires payments of interest only until the ARD in November 2031 or, if not repaid on the ARD, the final maturity date in November 2036.
Whole Loan Summary | |||||
Note | Original Balance | Cut-off Date Balance | Note Holder | Controlling Piece | |
A-1-1, A-2-1, A-3-1, A-4-1 | $285,000,000 | $285,000,000 | CAMB 2021-CX2 | Yes | |
A-1-3, A-3-2 | $94,000,000 | $94,000,000 | Benchmark 2021-B30 | No | |
A-1-7, A-4-2, A-4-3 | $77,900,000 | $77,900,000 | 3650R 2021-PF1 | No | |
A-1-2, A-1-4, A-1-9, A-3-3 | $148,140,816 | $148,140,816 | Benchmark 2021-B31 | No | |
A-1-5, A-1-6, A-1-8 | $101,000,000 | $101,000,000 | Benchmark 2022-B32 | No | |
A-2-3, A-2-4 | $55,000,000 | $55,000,000 | BANK 2021-BNK38 | No | |
A-2-2, A-2-5 | $52,959,184 | $52,959,184 | BANA(1) | No | |
Total Senior Notes | $814,000,000 | $814,000,000 | |||
B-1, B-2, B-3, B-4 | $411,000,000 | $411,000,000 | CAMB 2021-CX2 | No | |
Whole Loan | $1,225,000,000 | $1,225,000,000 |
(1) | Expected to be contributed to one or more future securitization trusts or may otherwise be transferred at any time. |
The Borrowers. The borrowers are DW PropCo G, LLC and DW PropCo H, LLC, both Delaware limited liability companies and single purpose entities with two independent directors. Legal counsel to the borrowers delivered a non-consolidation opinion in connection with the origination of the CX - 350 & 450 Water Street Whole Loan.
The Loan Sponsors. There is no non-recourse carveout guarantor or environmental indemnitor for the CX – 350 & 540 Water Street Whole Loan. The loan sponsors are a joint venture between DivcoWest (“Divco”), California State Teachers’ Retirement System (“CalSTRS”), and Teacher Retirement System of Texas (“TRS”).
Founded in 1993, Divco is a multidisciplinary investment firm headquartered in San Francisco, California with over 160 employees across six investment offices. Divco is an experienced developer, owner and operator of real estate throughout the United States, with significant expertise in Boston, having invested in and managed over 22 commercial properties in the area, including offices in the Seaport, Financial District, and East Cambridge submarkets. Most notably, Divco owned and operated One Kendall Square, a life sciences office campus in the Kendall Square submarket. As of June 30, 2021, Divco had over $13.7 billion in assets under management. Since inception, Divco has acquired approximately 55.0 million SF.
CalSTRS is reported to be the nation’s second largest public pension fund with assets totaling approximately $312.2 billion as of September 30, 2021. Their investment portfolio is broadly diversified into nine asset categories, approximately including 12.8% (approximately $39.8 billion) which is allocated towards real estate investments in institutional Class A commercial assets across the United States. Divco and CalSTRS have an 18-year history of investing together with CalSTRS investing over $1.5 billion into various Divco sponsored investment vehicles.
Established in 1937, TRS provides retirement and related benefits for those employed by the public schools, colleges, and universities supported by the State of Texas. As of August, 31 2020, the agency is serving nearly 1.7 million participants and had assets under management of nearly $187 billion. TRS is the largest public retirement system in Texas in both membership and assets.
The Property. The CX – 350 & 450 Water Street Property consists of two Class A LEED Gold (targeted), life sciences laboratory and office buildings totaling 915,233 SF located in Cambridge, Massachusetts. The CX – 350 & 450 Water Street Property includes (i) the 350 Water Street building (Parcel G) (“350 Water Street”), which is a laboratory building consisting of 511,157 SF and (i) the 450 Water building (Parcel
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
CX – 350 & 450 Water Street |
H) (“450 Water Street”), which is a contemporary office building consisting of 404,076 SF. Designed by Perkins +Will (350 Water Street) and NBBJ (450 Water Street), the CX – 350 & 450 Water Street Property has views of both the Cambridge and Boston skylines. The CX – 350 & 450 Water Street Property has an adjacent open space with playing field, a plaza to host food trucks and nearby access to two MBTA stops (Green and Orange line). The Lechmere MBTA green line is a 5-minute walk away. The CX – 350 & 450 Water Street Property is 100.0% leased to Aventis Inc., which is a wholly-owned subsidiary of Sanofi S.A. (“Sanofi”).
350 Water Street is a 12-story building featuring laboratory space, ground floor retail, a third-floor terrace, three below-grade parking levels with 377 parking spaces (0.74 per 1,000 square feet), bike storage with showers, an adjacent open space with playing field and fitness center. 350 Water Street has 15’ - 19’ ceiling heights and eight passenger elevators. 350 Water Street is anticipated to be Wired Score Platinum and LEED Gold certified upon completion.
450 Water Street is a 9-story building featuring office space, ground floor retail, a two-story mezzanine, three above-grade and two below-grade parking levels with 440 parking spaces (1.09 per 1,000 square feet) and bike storage. 450 Water Street has 14’ - 16’ ceiling heights and five passenger elevators. 450 Water Street is anticipated to be Wired Score Platinum, WELL Gold and LEED Gold certified upon completion.
The CX – 350 & 450 Water Street Property is currently under construction and expected to be substantially completed for 350 Water Street in the second quarter of 2022. The 450 Water Street building reached substantial completion on December 16, 2021. At loan origination, the borrowers reserved the following with the lender: (i) $86,650,891 for base building work related to hard costs, hard cost contingency, soft costs and soft cost contingency for the CX – 350 & 450 Water Street Property, (ii) approximately $15,483,880 on account of tenant improvement allowance related to 350 Water Street and $28,254,233 of tenant improvement allowances related to 450 Water Street and (iii) approximately $8,323,967 of leasing commissions related to 450 Water Street. Below is a chart which details the loan sponsors’ development budgets, which do not include land allocations or financing costs. We cannot assure you either 350 Water Street or 450 Water Street will be completed as expected or at all.
Development Budget Summary | |||||||
350 Water Street (Parcel G) | 450 Water Street (Parcel H) | ||||||
Budget | Remaining Cost | Budget | Remaining Cost | ||||
Hard Costs | $221,627,140 | $35,507,711 | $181,926,397 | $28,882,890 | |||
Hard Cost Contingency | 915,139 | 1,065,231 | 866,487 | 866,487 | |||
Soft Costs | 43,854,255 | 8,357,324 | 42,547,726 | 11,379,153 | |||
Soft Cost Contingency | 210,241 | 250,720 | 341,375 | 341,375 | |||
Tenant Improvement Allowance | 139,789,250 | 15,483,880 | 64,916,764 | 28,254,233 | |||
Leasing Commissions | 26,886,858 | 0 | 21,254,398 | 8,323,967 | |||
Total | $433,282,883 | $60,664,866 | $311,853,147 | $78,048,105 | |||
As of October 14, 2021, the CX – 350 & 450 Water Street Property is 100.0% leased to Aventis Inc., a wholly-owned subsidiary of Sanofi S.A. (rated A+/A1/AA by Fitch/Moody’s/S&P), which is the guarantor under the Aventis Inc. leases. Founded in 1973, Sanofi is a multinational pharmaceutical company headquartered in Paris, France. Sanofi engages in the research and development, manufacturing, and marketing of pharmaceutical drugs principally in the prescription market. Sanofi (NASDAQ:SNY) is publicly traded on the NASDAQ stock exchange and had a market cap of approximately $123.1 billion as of October 16, 2021.
The CX – 350 & 450 Water Street Property is expected to serve as Sanofi’s North American research headquarters, where it is expected to consolidate approximately 3,000 employees from a number of local offices in the Boston area, as well as the Company’s Center of Excellence dedicated to mRNA vaccine research. Additionally, Sanofi is expected to consolidate approximately 400 employees from various sites at the Cambridge Crossing development and in Lyon, France to form a Center of Excellence dedicated to mRNA vaccine research. Sanofi plans to invest more than $476.0 million per year to develop vaccines against infectious diseases.
The CX – 350 & 450 Water Street Property is currently undergoing a buildout with an expected completion date of the second quarter of 2022 for 350 Water Street. The 450 Water Street building reached substantial completion on December 16, 2021. We cannot assure you the buildouts will be completed as expected or at all. Aventis Inc.’s tenant buildout contract and base building changes total approximately $304.3 million ($595 per square foot) for 350 Water Street and approximately $90.9 million ($225 per square foot) for 450 Water Street. Aventis Inc. is entitled to receive an approximately $139.8 million ($273per square foot) tenant improvement allowance for 350 Water Street and an approximately $73.7 million ($182 per square foot) tenant improvement allowance for 450 Water Street. In total, the approximately $395.2 million ($432 per square foot) tenant buildout contract and base building changes do not include any tenant investment for soft costs. Additionally, the approximately $395.2 million ($432 per square foot) can be paid from the tenant improvement allowance to the extent available. In addition to the tenant buildout contract and base building changes, Sanofi is expected to invest approximately $181.7 million ($198 per square foot) into the CX – 350 & 450 Water Street Property, not including furniture, fixtures and equipment (“FF&E”).
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
CX – 350 & 450 Water Street |
Aventis Inc. executed two, 15-year leases at the CX – 350 & 450 Water Street Property in late 2018. The rent commencement date of the lease at 350 Water Street was July 1, 2021 and the rent commencement date of the lease at 450 Water Street was November 10, 2021. The sole tenant, Aventis Inc. is not yet in occupancy of either 350 Water Street or 450 Water Street, pending the buildout of its space. We cannot assure you that the buildout of the CX – 350 & 450 Water Street Property will be completed as expected or at all, or that Aventis Inc. will take occupancy as expected or at all. At loan origination, the borrowers reserved approximately $10,732,231 into a gap rent reserve for the Aventis Inc. lease related to 450 Water Street. Aventis Inc. has the right to terminate each of its respective leases effective as of the end of the 14th lease year subject to a termination fee equal to 12 months base rent.
The blended starting base rent for the Aventis Inc. triple-net leases are $71.53 per square foot for 350 Water Street and 450 Water Street. Base rent for the laboratory building, 350 Water Street, is $75.90 per square foot and base rent for the office building, 450 Water Street, is $66.00 per square foot, with both leases including approximately 2.5% annual rent steps. Aventis, Inc. did not receive any free rent as part of its lease. The in-place rent at 350 Water Street is approximately 31.0% below the appraisal’s concluded triple-net market rent of $110.00 per square foot for the laboratory space and in-place rent at 450 Water Street is approximately 22.4% below the appraisal’s concluded triple-net market rent of $85.00 per square foot for the office space. Sanofi’s guarantees of the leases at 350 Water Street and 450 Water Street have guaranty caps of $207.5 million and $142.5 million, respectively.
COVID-19 Update. As of January 6, 2022, the CX – 350 & 450 Water Street Whole Loan is not subject to any forbearance, modification or debt service relief request. There have been no requests for rent relief. The CX – 305 & 450 Water Street Whole Loan is current as of the January 2022 payment date. See “Risk Factors—Special Risks—Coronavirus Pandemic Has Adversely Affected the Global Economy and Will Likely Adversely Affect the Performance of the Mortgage Loans” in the Preliminary Prospectus.
The Market. The CX – 350 & 450 Water Street Property is located in the Cambridge market within the Greater Boston area. The city of Cambridge is located in the Boston core-based statistical area directly north of the city of Boston and separated from Boston’s central business district by the Charles River. Cambridge is bordered by Somerville to the north and Watertown to the west. The city is acclaimed for its mix of venture capital, National Institutes of Health funding and state investments. In recent years, Cambridge has become a life sciences and biotechnology hub not only for the northeast, but for the entire United States. Cambridge is home to over 5,000 private business establishments with major companies including Watson Health, Amgen, Facebook and Apple, among others.
The Cambridge market is best known for its innovation and high concentration of research and development operations. Cambridge has one of the highest densities of educated people in the world with 42 colleges, universities and community colleges and is home to Harvard University and the Massachusetts Institute of Technology. There are over 11,000 undergraduate students and over 11,000 graduate students living in Cambridge.
The CX – 350 & 450 Water Street Property is part of a larger approximately 4.5 million square feet master-planned mixed-use-transit-oriented development known as Cambridge Crossing, which is an innovation community in East Cambridge, proximate to Kendall Square. Cambridge Crossing is spread across 43 acres and is expected to total over 17 buildings consisting of over 2.1 million square feet of science and technology space, approximately 2.4 million square feet of residential space, 100,000 SF of retail space and 11 acres of open space. The development of Cambridge Crossing has approximately 2.5 million square feet completed or under construction and recent leases to Philips, Sanofi, and Bristol Myers Squibb.
Cambridge Crossing benefits from its various forms of transit, including one MBTA (Green Line) station soon to be on site, and one MBTA (Orange Line) station a short walk away, four Hubway stations, designated bike lanes, an EZ ride and private Cambridge Crossing shuttle, walking paths and acres of green spaces. In addition, Cambridge Crossing is approximately 3.5 miles from the Boston Logan International Airport.
The following table presents the submarket statistics for the laboratory and office space in the Cambridge market:
Laboratory Submarket Statistics(1) | ||||||||
Submarket | Inventory | Overall Vacancy Rate | Direct Vacancy Rate | YTD Construction Completions | YTD Overall Absorptions | Under Construction | Direct Avg. Rent | Direct Avg. Rent |
Alewife | 1,192,000 | 1.0% | 0.0% | 0 | 100,681 | 3,100,000 | $71.00 | N/A |
East Cambridge | 7,397,000 | 1.3% | 0.0% | 0 | (56,745) | 2,304,000 | $105.81 | $105.81 |
Mid Cambridge | 3,934,000 | 1.3% | 0.0% | 0 | (41,966) | 0 | $82.88 | $81.07 |
Total/Wtd. Avg. | 12,523,000 | 1.0% | 0.0% | 0 | 1,970 | 5,404,000 | $100.40 | $104.14 |
(1) | Source: 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.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
CX – 350 & 450 Water Street |
Office Submarket Statistics(1) | ||||||||
Submarket | Inventory | Overall Vacancy Rate | Direct Vacancy Rate | YTD Construction Completions | YTD Overall Absorptions | Under Construction | Direct Avg. Rent | Direct Avg. Rent (Class A) |
Alewife | 1,652,770 | 5.6% | 3.6% | 0 | 37,442 | 0 | $59.92 | $60.22 |
East Cambridge | 8,207,363 | 7.2% | 2.8% | 0 | 196,420 | 1,235,423 | $82.60 | $82.29 |
Mid Cambridge | 2,175,363 | 6.8% | 3.7% | 0 | (40,073) | 0 | $65.07 | $80.56 |
Total/Wtd. Avg. | 12,035,496 | 6.9% | 3.0% | 0 | 193,789 | 1,235,423 | $75.07 | $79.92 |
(1) | Source: Appraisal. |
The laboratory lease comparables range in size from 40,000 square feet to 260,000 square feet with lease terms ranging from 5 to 15 years. The comparables exhibit a range in rents from $88.50 to $105.00 per square foot, with an average of $95.20 per square foot on a net basis. Free rent concessions ranged from 0 to 12 months, averaging 1.71 months with tenant improvement allowances ranging from $0.00 to $225.00 per square foot, an average of $182.14 per square foot.
The appraiser concluded to a market rent of $110.00 per square foot at 350 Water Street, which is a 44.9% premium to the in-place rent of $75.90 per square foot.
The following table summarizes the comparable laboratory leases in the surrounding market.
Summary of Comparable Laboratory Leases(1) | ||||||||||
Property | Location | Year Built | Tenant Name | Lease Start Date | Term (yrs.) | Lease Type | Tenant Size (SF) | Base Rent PSF | Rent Steps | TI PSF |
350 Water Street(2) | Cambridge, MA | 2021(3) | Aventis Inc. | Jul-21 | 15.0 | Net | 511,157 | $75.90 | 2.50% | $250.00 |
Seaport Labs | Boston, MA | 2023 | Eli Lilly LOI | Jan-23 | 15.0 | Net | 165,000 | $103.00 | 3.00% | $210.00 |
201 Brookline Avenue | Boston, MA | 2022 | Verve Therapeutics | Jun-22 | 15.0 | Net | 105,000 | $91.00 | 3.00% | $225.00 |
Cambridge Crossing EF | Cambridge, MA | 2023 | Bristol Myers Squibb | May-22 | 15.0 | Net | 40,000 | $105.00 | 2.75% | $225.00 |
238 Main Street | Cambridge, MA | 2021 | Beam Therapeutics | Aug-21 | 12.0 | Net | 122,620 | $96.50 | 3.00% | $190.00 |
65 Landsdowne Street | Cambridge, MA | 2001 | Brigham and Women's | Feb-21 | 5.0 | Net | 112,410 | $100.00 | 3.00% | $0.00 |
Cambridge Crossing EF | Cambridge, MA | 2023 | Bristol Myers Squibb | Aug-20 | 15.0 | Net | 260,000 | $88.50 | 2.50% | $225.00 |
Cambridge Crossing | Cambridge, MA | 2019 | Cereval | Feb-20 | 10.0 | Net | 59,865 | $92.00 | 3.00% | $200.00 |
Total/Wtd. Avg.(4) | 12.4 | 123,556 | $95.20 | $186.20 |
(1) | Source: Appraisal. |
(2) | Based on the rent roll dated October 14, 2021. |
(3) | 350 Water Street is currently under construction with the base building substantial completion date expected in the second quarter of 2022. We cannot assure you the base building construction will be completed as expected or at all. |
(4) | The Total/Wtd. Avg. excludes 350 Water Street. |
The office lease comparables range in size from 47,304 per square foot to 581,538 SF and have lease terms ranging from 10 to 15 years. The lease comparables exhibit a range in rents from $64.95 to $100.00 per square foot, with an average of $79.16 per square foot on a net basis. Free rent concessions ranged from 0 to 8 months, averaging two months with tenant improvement allowances ranging from $0.00 to $161 per square foot, an average of $66.00 per square foot. The Google lease ($88.50 per square foot) and Bluebird Bio lease ($100 per square foot) are most comparable to 450 Water Street due to their Cambridge locations but warrant slight downward adjustments as they are in Kendall Square.
The appraiser concluded to a market rent of $85.00 per square foot at 450 Water Street, which is a 28.8% premium to the in-place rent of $66.00 per square foot.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
CX – 350 & 450 Water Street |
The following table summarizes the comparable office leases in the surrounding market.
Summary of Comparable Office Leases(1) | ||||||||||
Property | Location | Year Built | Tenant Name | Lease Start Date | Term (yrs.) | Lease Type | Tenant Size (SF) | Base Rent PSF | Rent Steps | TI PSF |
450 Water Street(2) | Cambridge, MA | 2021(3) | Aventis Inc. | Nov-21 | 15.0 | Net | 404,076 | $66.00 | 2.50% | $175.00 |
Seaport Labs I | Boston, MA | 2023 | Foundation Medicine (Shell) | Sep-23 | 15.0 | Net | 581,538 | $69.50 | 2.50% | $0.00 |
1001 Boylston Street | Boston, MA | 2022 | CarGurus | Jun-23 | 15.0 | Net | 225,428 | $64.95 | $1.30/SF | $161.00 |
Google HQ | Cambridge, MA | 2022 | Apr-22 | 15.0 | Net | 385,423 | $88.50 | $1.00/SF | $84.00 | |
222 Berkeley Street | Boston, MA | 1991 | GW&K Investments | Feb-21 | 10.0 | Net | 47,304 | $72.00 | 2.00% | $85.00 |
Alexandria Center | Cambridge, MA | 2017 | Bluebird Bio | Jan-21 | 10.0 | Net | 267,000 | $100.00 | 3.00% | $0.00 |
Total/Wtd. Avg.(4) | 13.0 | 301,339 | $79.16 | $48.24 |
(1) | Source: Appraisal. |
(2) | Based on the rent roll dated October 14, 2021. |
(3) | 450 Water Street is currently under construction with the base building work having reached substantial completion on December 16, 2021. We cannot assure you that buildout will be completed as expected or at all. |
(4) | The Total/Wtd. Avg. excludes 450 Water Street. |
Tenant Summary(1) | |||||||
Tenant(2) | Ratings Moody’s/Fitch/S&P(3) | Net Rentable Area (SF)(4) | % of Total NRA | Base Rent PSF | % of Total Base Rent | Lease Expiration Date(5) | |
Aventis Inc. (350 Water Street) | A1 / A+ / AA | 511,157 | 55.8% | $75.90 | 59.3% | 6/30/2036 | |
Aventis Inc. (450 Water Street) | A1 / A+ / AA | 404,076 | 44.2 | $66.00 | 40.7% | 11/30/2036 | |
Total | 915,233 | 100.0% | $71.53 | 100.0% | |||
Vacant | 0 | 0.0 | |||||
Total | 915,233 | 100.0% |
(1) | Based on the underwritten rent roll as of October 14, 2021. |
(2) | Aventis Inc. is currently not in occupancy of either 350 Water Street or 450 Water Street, pending the substantial completion of the buildout out of its spaces at the CX- 350 & 450 Water Street Property. The CX – 350 & 450 Water Street Property is currently undergoing a buildout with expected completion dates of the second quarter of 2022 for 350 Water Street. The 450 Water Street building reached substantial completion on December 16, 2021. The lease at 350 Water Street commenced on July 1, 2021 and the lease at 450 Water Street commenced on November 10, 2021. |
(3) | The credit ratings are those of the direct parent company, Sanofi, which is the guarantor under the leases. |
(4) | The Tenant NRA includes up to 10,000 SF of terrace space at 350 Water Street and up to 4,000 SF of terrace space at 450 Water Street. |
(5) | Aventis Inc. has the right to terminate each of the leases, with a termination fee, effective as of the end of its 14th lease year. If Aventis Inc. elects to exercise the early termination right, it must deliver to the landlord between 24 and 36 months prior to the early termination date (a) notice that the early termination right has been exercised and (b) the early termination payment. The early termination payment equals the sum of (i) the 12 monthly installments of base rent that would have been due for the 12-month period immediately following the early termination date in the absence of such termination and (ii) the stipulated operating expenses/tax component per the lease. |
Lease Rollover Schedule(1)(2) | ||||||||||
Year | Number of Leases Expiring | Net Rentable Area Expiring | % of NRA Expiring | Base Rent Expiring(1) | % of Base Rent Expiring | Cumulative Net Rentable Area Expiring | Cumulative % of NRA Expiring | Cumulative Base Rent Expiring | Cumulative % of Base Rent Expiring | |
Vacant | 0 | 0 | 0.0% | NAP | NAP | 0 | 0.0% | NAP | NAP | |
MTM & 2022 | 0 | 0 | 0.0% | 0 | 0 | 0 | 0.0% | 0 | 0.0% | |
2023 | 0 | 0 | 0.0% | 0 | 0 | 0 | 0.0% | 0 | 0.0% | |
2024 | 0 | 0 | 0.0% | 0 | 0 | 0 | 0.0% | 0 | 0.0% | |
2025 | 0 | 0 | 0.0% | 0 | 0 | 0 | 0.0% | 0 | 0.0% | |
2026 | 0 | 0 | 0.0% | 0 | 0 | 0 | 0.0% | 0 | 0.0% | |
2027 | 0 | 0 | 0.0% | 0 | 0 | 0 | 0.0% | 0 | 0.0% | |
2028 | 0 | 0 | 0.0% | 0 | 0 | 0 | 0.0% | 0 | 0.0% | |
2029 | 0 | 0 | 0.0% | 0 | 0 | 0 | 0.0% | 0 | 0.0% | |
2030 | 0 | 0 | 0.0% | 0 | 0 | 0 | 0.0% | 0 | 0.0% | |
2031 | 0 | 0 | 0.0% | 0 | 0 | 0 | 0.0% | 0 | 0.0% | |
2032 and Thereafter | 2 | 915,233 | 100.0% | $65,465,832 | 100.0% | 915,233 | 100.0% | $65,465,832 | 100.0% | |
Total | 2 | 915,233 | 100.0% | $65,465,832 | 100.0% | |||||
(1) | Based on the underwritten rent roll dated October 14, 2021. |
(2) | Certain tenants may have termination or contraction options (which may become exercisable prior to the originally stated expiration date of the tenant lease) that are not considered in the above Lease Expiration Schedule. |
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
CX – 350 & 450 Water Street |
Operating History and Underwritten Net Cash Flow(1)(2) | |||
Underwritten | Per Square Foot | %(3) | |
Base Rent(4) | $65,465,832 | $71.53 | 69.4% |
Straight Line Base Rent Average(5) | 13,436,165 | $14.68 | 14.2% |
Gross Potential Rent | $78,901,997 | $86.21 | 83.6% |
Tenant Recoveries | 11,768,903 | $12.86 | 12.5% |
Total Recoveries | $11,768,903 | $12.86 | 12.5% |
Other Income | $3,673,555 | $4.01 | 3.9% |
Net Rentable Income | $94,344,455 | $103.08 | 100.0% |
Vacancy | (1,415,167) | ($1.55) | -1.5% |
Effective Gross Income | $92,929,288 | $101.54 | 98.5% |
Total Fixed Expenses | $7,998,329 | $8.74 | 8.6% |
Total Variable Expenses | $4,227,428 | $4.62 | 4.5% |
Total Expenses | $12,225,756 | $13.36 | 13.2% |
0.0% | |||
Net Operating Income | $80,703,532 | $88.18 | 86.8% |
Reserves for Replacements | 137,285 | $0.15 | 0.1% |
TI/LC | 0 | $0.00 | 0.0% |
Net Cash Flow | $80,566,247 | $88.03 | 86.7% |
(1) | Historical financial information and occupancy is not available because the CX - 350 & 450 Water Street Property is currently under construction. As of October 8, 2021, the base building work for the CX – 350 & 450 Water Street Property is 90% complete. |
(2) | Based on the underwritten rent roll as of October 14, 2021. |
(3) | % column represents percent of Net Rental Income for all revenue lines and represents percent of Effective Gross Income for the remainder of the fields. |
(4) | The rent commencement date for the lease at 350 Water Street was in July 2021 and the rent commencement date for the lease at 450 Water Street was in November 2021. At loan origination, the borrowers reserved approximately $10,732,231 into a gap rent reserve for the Aventis Inc. lease related to 450 Water Street. |
(5) | Straight-line average rent credit for Aventis Inc. (Sanofi, investment grade rated parent company) through its lease term, including parking income rent adjusted for increases of 2.0% adjusted for CPI. The straight-line rent averages result in an average triple-net base rent of $90.99 per square foot for the 350 Water Street lease and $78.98 per square foot for the 450 Water Street lease over the life of the lease. |
Property Management. The CX - 350 & 450 Water Street Property is managed by Divco West Real Estate Services, Inc., an affiliate of one of the loan sponsors.
Escrows and Reserves. At loan origination, the borrowers deposited approximately (i) $52,062,079 into an existing TI/LC reserve, (ii) $86,650,891 into a base building work reserve and (iii) $10,732,231 into an Aventis rent reserve.
Tax Reserve – During a Trigger Period (as defined below), the borrowers are required to deposit into a real estate tax reserve, on a monthly basis, 1/12th of the estimated annual real estate taxes.
Insurance Reserve – During a Trigger Period, the borrowers are required to deposit into an insurance reserve, on a monthly basis, 1/12th of estimated insurance premiums, unless an acceptable blanket policy is in effect.
Rollover Reserve – During a Lease Sweep Period (as defined below), all available cash will be swept into the deposit account held by the lender, which will be transferred to the rollover reserve.
Lockbox / Cash Management. The CX - 350 & 450 Water Street Whole Loan is structured with a hard lockbox and springing cash management. The borrowers are required to deliver tenant direction letters instructing all tenants to deposit rents into a lender-controlled lockbox account. The borrowers are required to cause all rents to be deposited directly into the lender-controlled lockbox account. All funds received by the borrowers or the manager are required to be deposited in the lockbox account within two business days following receipt. During the continuance of a Trigger Period, funds on deposit in the lockbox account are required to be swept on a daily basis into a lender-controlled cash management account. Prior to the ARD, all excess cash is required to be transferred to a lender-controlled account as additional collateral for the CX - 350 & 450 Water Street Whole Loan, subject to certain permitted uses by the borrowers described in the CX – 350 & 450 Water Street Whole Loan documents, and except as described above with respect to a Lease Sweep Period. If the CX - 350 & 450 Water Street Whole Loan is not paid by the ARD, from and after the ARD, the CX - 350 & 450 Water Street Whole Loan will accrue interest at the Adjusted Interest Rate; however, interest accrued at the excess of the Adjusted Interest Rate over the initial interest rate will be deferred.
After the ARD, all amounts on deposit in the cash management account after payment of debt service, required reserves and budgeted operating expenses will be required to be applied to the prepayment of the outstanding principal balance of the CX – 350 & 450 Water Street Whole Loan, first to the CX – 350 & 450 Water Street Senior Notes and then to the CX – 350 & 450 Water Street Junior Notes, until the outstanding principal balance has been reduced to zero, then to any excess interest until the excess interest has been reduced
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
CX – 350 & 450 Water Street |
to zero and then to any other indebtedness due under the CX – 350 & 450 Water Street Whole Loan until the other indebtedness has been reduced to zero.
A “Trigger Period” will commence upon (i) the ARD, (ii) the occurrence of an event of default under the CX - 350 & 450 Water Street Whole Loan until cured, (iii) on any date from and after December 31, 2022, the debt service coverage ratio is less than 1.75x based on the CX - 350 & 450 Water Street Whole Loan as of two consecutive calendar quarters, and will end upon the earlier to occur of (a) the debt service coverage ratio based on the CX - 350 & 450 Water Street Whole Loan is equal to or greater than 1.75x for two consecutive calendar quarters or (b) the funds on deposit in the cash collateral account are equal to the sum of (x) $25,557,850, to the extent 350 Water Street has not been released and (y) $20,203,800, to the extent 450 Water Street has not been released, and (iv) the commencement of a Lease Sweep Period.
A “Lease Sweep Period” will commence (prior to the ARD), upon (i) the earliest to occur of (a) the date that is 12 months prior to the earliest stated expiration of the Lease Sweep Lease (as defined below), (b) the last date under such Lease Sweep Lease that the tenant has the right to give notice of its exercise of a renewal option, (c) with respect to any Lease Sweep Lease that is a Short Term Qualifying Lease (as defined below), the date that is 12 months prior to the ARD and (d) with respect to any Lease Sweep Lease that is a Short Term Qualifying Lease, the date that the lender reasonably determines that a Lease Sweep Period commences in order for the aggregate amount of available cash that is projected to be deposited into the rollover account for the period commencing on such date through the ARD will be equal to the applicable Lease Sweep Deposit Amount (as defined below), (ii) the date of the early termination, early cancellation or early surrender of a Lease Sweep Lease (or any material portion thereof) prior to its then current expiration date or the receipt by the applicable borrower or manager of written notice from the tenant under a Lease Sweep Lease of its intent to effect an early termination, early cancellation or early surrender of such Lease Sweep Lease prior to its then current expiration date; (iii) solely with respect to any Lease Sweep Lease under which neither the tenant thereunder, nor any guarantor of all of the tenant’s obligations thereunder, is an investment grade entity, if such tenant has ceased operating its business (i.e., “goes dark”) in a majority of its leased space at the applicable property and the same has not been subleased, on the origination date or thereafter in accordance with the terms of the CX – 350 & 450 Water Street Whole Loan documents, pursuant to a sublease on the same or substantially similar or better terms as the applicable Lease Sweep Lease (provided that a Lease Sweep Period will not exist if the sole reason the tenant is dark is for certain reasons relating to the COVID-19 pandemic or any other pandemic or epidemic, and the tenant continues paying contractual rent under its lease); (iv) a monetary or material non-monetary default under a Lease Sweep Lease by the tenant; or (v) the occurrence of an insolvency proceeding of a tenant under a Lease Sweep Lease or its parent company or lease guarantor.
A Lease Sweep Period will end upon, (A) in the case of clauses (i)(a), (i)(b), (i)(c), and/or (i)(d) above, the entirety of the Lease Sweep Lease space (or applicable portion thereof) is leased pursuant to one or more qualified leases and in the lender’s reasonable judgment, sufficient funds have been accumulated in the rollover account, (B) in the case of clause (i)(a) above, the date on which the tenant under the Lease Sweep Lease irrevocably exercises its renewal or extension option or otherwise extends its Lease Sweep Lease in accordance with the terms of the CX – 350 & 450 Water Street Whole Loan documents with respect to all of its Lease Sweep Lease space, and, in the lender’s reasonable judgment, sufficient funds have been accumulated in the rollover account, (C) in the case of clause (ii) above, if the tenant under the applicable Lease Sweep Lease rescinds in writing the exercise of its notice exercising its early termination, cancellation or surrender right or option, (D) in the case of clause (iii) above, the circumstances giving rise to a Lease Sweep Period under clause (iii) no longer exist; (E) in the case of clause (iv) above, the date on which the subject default has been cured; (F) in the case of clause (v) above, either (x) the applicable insolvency proceeding has terminated or (y) the applicable Lease Sweep Lease has been assumed or assumed and assigned to a third party in a manner reasonably satisfactory to the lender; (G) in the case of clauses (i), (ii), (iii), (iv) and/or (v) above, the properties have achieved a debt yield of not less than 6.0% and, in the lender’s reasonable judgment, sufficient funds have been accumulated in the rollover account; or (H) in the case of clauses (i), (ii), (iii), (iv) and/or (v) above, the date on which funds in the rollover account collected with respect to the Lease Sweep Lease space in question is equal to the Lease Sweep Deposit Amount applicable to such Lease Sweep Lease space.
A “Lease Sweep Lease” means (i) the Aventis Inc. lease at 350 Water Street, (ii) the Aventis Inc. lease at 450 Water Street or (iii) any replacement lease that, either individually, or when taken together with any other lease with the same tenant or its affiliates covers the majority of the Lease Sweep Lease space.
A “Lease Sweep Deposit Amount” means an amount equal to the total rentable SF of the applicable Lease Sweep Lease space that is the subject of a Lease Sweep Period multiplied by $50.00.
A “Short Term Qualifying Lease” means any qualified lease that has an initial term which does not extend at least two years beyond the ARD.
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
CX – 350 & 450 Water Street |
Current Mezzanine or Subordinate Indebtedness. The CX - 350 & 450 Water Street Junior Notes have an aggregate outstanding principal balance as of the Cut-off Date of $411,000,000 and accrue interest at an initial fixed rate of 2.79200% per annum, followed by a rate increase after the ARD. For additional information, see “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced AB Whole Loans—CX - 350 & 450 Water Street Whole Loan” in the Preliminary Prospectus.
Future Mezzanine or Subordinate Indebtedness Permitted. Not permitted.
Partial Release. The CX - 350 & 450 Water Street Whole Loan documents allow, on any business day following the defeasance lockout period (for a defeasance) or on any business day after December 6, 2023 (for a prepayment), any borrower to obtain the release of its respective property in connection with a bona fide third-party sale upon the following conditions: (i) the borrowers must partially prepay (with the prepayment fee) or partially defease the CX – 350 & 450 Water Street Whole Loan in an amount equal to, (a) with respect to the release of 350 Water Street, 110% of the allocated loan amount and (b) with respect to the release of 450 Water Street, 105% of the allocated loan amount so long as after giving effect to such release, (ii) the debt service coverage ratio is equal to or greater than the greater of the debt service coverage ratio on the CX – 350 & 450 Water Street Whole Loan preceding such release and 1.90x and (iii) certain REMIC related conditions are satisfied. The allocated loan amount for the 350 Water Street property is $720,300,000 and the allocated loan amount for the 450 Water Street property is $504,700,000.
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
One Wilshire |
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
One Wilshire |
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
One Wilshire |
Mortgage Loan Information | Property Information | |||
Mortgage Loan Seller: | GSMC | Single Asset / Portfolio: | Single Asset | |
Original Principal Balance(1): | $90,000,000 | Title: | Fee | |
Cut-off Date Principal Balance(1): | $90,000,000 | Property Type - Subtype: | Office - CBD/Data Center | |
% of Pool by IPB: | 5.1% | Net Rentable Area (SF): | 661,553 | |
Loan Purpose: | Refinance | Location: | Los Angeles, CA | |
Borrower: | GI TC One Wilshire, LLC | Year Built / Renovated: | 1967 / 1992 | |
Guarantor: | TechCore, LLC | Occupancy: | 87.3% | |
Interest Rate(2): | 2.77600% | Occupancy Date: | 11/1/2021 | |
Note Date: | 12/22/2021 | Number of Tenants: | 36 | |
ARD Date(2): | 1/6/2032 | Fourth Most Recent NOI: | $29,471,312 (December 31, 2018) | |
Maturity Date: | 1/6/2035 | Third Most Recent NOI: | $31,610,806 (December 31. 2019) | |
Interest-only Period: | 120 months | Second Most Recent NOI: | $34,570,190 (December 31, 2020) | |
Original Term: | 120 months | Most Recent NOI: | $35,627,157 (T-12 September 30, 2021) | |
Original Amortization: | None | UW Economic Occupancy: | 88.8% | |
Amortization Type: | Interest Only - ARD | UW Revenues: | $54,609,882 | |
Call Protection(3): | L(25),D(88),O(7) | UW Expenses: | $17,099,493 | |
Lockbox / Cash Management: | Hard / Springing | UW NOI: | $37,510,389 | |
Additional Debt(1): | Yes | UW NCF: | $36,919,391 | |
Additional Debt Balance(1): | $205,000,000 / $94,250,000 | Appraised Value / Per SF: | $913,000,000 / $1,380 | |
Additional Debt Type(1): | Pari Passu / Subordinate | Appraisal Date: | 11/5/2021 | |
Escrows and Reserves(4) | Financial Information | ||||||
Initial | Monthly | Initial Cap | Senior Notes | Whole Loan | |||
Taxes: | $0 | Springing | N/A | Cut-off Date Loan / SF: | $446 | $588 | |
Insurance: | $0 | Springing | N/A | Maturity Date Loan / SF: | $446 | $588 | |
Replacement Reserves: | $0 | Springing | N/A | Cut-off Date LTV: | 32.3% | 42.6% | |
TI/LC: | $0 | Springing | N/A | Maturity Date LTV: | 32.3% | 42.6% | |
Other: | $0 | Springing | N/A | UW NCF DSCR: | 4.45x | 3.37x | |
UW NOI Debt Yield: | 12.7% | 9.6% | |||||
|
Sources and Uses | ||||||
Sources | Proceeds | % of Total | Uses | Proceeds | % of Total | |
Loan Amount | $295,000,000 | 75.8% | Loan Payoff | $190,909,806 | 49.0% | |
Subordinate Debt | 94,250,000 | 24.2 | Return of Equity | 197,558,597 | 50.8 | |
Closing Costs | 781,598 | 0.2 | ||||
Total Sources | $389,250,000 | 100.0% | Total Uses | $389,250,000 | 100.0% |
(1) | The One Wilshire Loan (as defined below) is part of a whole loan evidenced by (i) three pari passu senior notes, with an aggregate outstanding principal balance as of the Cut-off Date of $295.0 million and (ii) one controlling subordinate note with an outstanding principal balance as of the Cut-off Date of $94.25 million. The Financial Information in the chart above reflects the Cut-off Date Balance of the One Wilshire Whole Loan (as defined below) and excludes the One Wilshire Trust Subordinate Companion Loan (as defined below) unless otherwise specified. |
(2) | The One Wilshire Loan is structured with an anticipated repayment date (“ARD”) of January 6, 2032 and a final maturity date of January 6, 2035. After the ARD, the interest rate will be revised to 3.0% over the greater of (x) 2.77600% and (y) the term SOFR rate in effect on the ARD, pursuant to the One Wilshire Whole Loan documents. The Mortgage Loan Information and Financial Information presented in the tables above are calculated based on the ARD. |
(3) | The defeasance lockout period, with respect to a defeasance of the One Wilshire Whole Loan, will be at least 25 payment dates beginning with and including the first payment date on February 6, 2022. Defeasance of the full $295.0 million One Wilshire Senior Notes (as defined below) is permitted after the date that is earlier of (i) two years from the closing date of the securitization that includes the last note to be securitized and (ii) December 22, 2024. |
(4) | For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
55 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
One Wilshire |
The Loan. The One Wilshire mortgage loan (the “One Wilshire Loan” or “One Wilshire Trust Senior Note”) is part of a whole loan with an aggregate outstanding principal balance as of the Cut-off Date of $389.25 million (the “One Wilshire Whole Loan) comprised of (i) three senior pari passu notes with an aggregate outstanding principal balance as of the Cut-off Date of $295.0 million (the “One Wilshire Senior Notes”) and (ii) one controlling subordinate note with an outstanding principal balance as of the Cut-off Date of $94.25 million (the “One Wilshire Trust Subordinate Companion Note”). The One Wilshire Whole Loan is secured by the borrower’s fee interest in a 661,553 square foot building comprised of data center and office space located in downtown Los Angeles, California (the “One Wilshire Property”). Only the One Wilshire Trust Senior Note will be included in the mortgage pool for the Benchmark 2022-B32 mortgage trust. The remaining One Wilshire Senior Notes (the “One Wilshire Non-Trust Senior Notes”) have an aggregate outstanding principal balance as of the Cut-off Date of $205.0 million. The One Wilshire Trust Subordinate Companion Loan will be contributed to the Benchmark 2022-B32 mortgage trust but will not be included in the mortgage pool. Payments allocated to the One Wilshire Trust Subordinate Companion Loan will be paid only to the holders of the One Wilshire loan-specific certificates as described in “Description of the Mortgage Pool—The Whole Loans—The Serviced AB Whole Loans—One Wilshire Whole Loan” in the Preliminary Prospectus.
The One Wilshire Whole Loan, which accrues interest at an interest rate of 2.77600% per annum, was originated by Goldman Sachs Bank USA on December 22, 2021, had an aggregate original principal balance of $389.25 million and has an aggregate outstanding principal balance as of the Cut-off Date of $389.25 million. The proceeds of the One Wilshire Whole Loan were primarily used to refinance the One Wilshire Property, pay origination costs, cover defeasance and return equity to the loan sponsor. The relationship between the holders of the One Wilshire Whole Loan is governed by a co-lender agreement as described under “Description of the Mortgage Pool—The Whole Loans—The Serviced AB Whole Loan” in the Preliminary Prospectus. The One Wilshire Whole Loan has a 10-year interest-only term through the ARD of January 6, 2032 and a final maturity date of January 6, 2035. After the ARD, through and including January 6, 2035, the following structure will apply: the interest rate will increase (such new rate, the “Adjusted Interest Rate”) by 3.0% over the greater of (x) 2.77600%, and (y) the term SOFR rate in effect on the ARD; however, interest accrued at the excess of the Adjusted Interest Rate over the initial interest rate will be deferred as described below under “Lockbox / Cash Management.” For the period from the origination date through the ARD, the One Wilshire Whole Loan accrues interest at the rate of 2.77600% per annum. Voluntary prepayment of the One Wilshire Whole Loan in whole (but not in part) is permitted on or after the open prepayment date occurring in July 2031 without payment of any prepayment premium. Defeasance of the One Wilshire Whole Loan only in whole is permitted at any time after the earlier of (i) December 22, 2024 or (ii) the first due date following the second anniversary of the closing date of the securitization that includes that last note of the One Wilshire Whole Loan to be securitized.
The table below summarizes the promissory notes that comprise the One Wilshire Whole Loan. The relationship between the holders of the One Wilshire Whole Loan will be governed by a co-lender agreement as described “Description of the Mortgage Pool—The Whole Loans—The Serviced AB Whole Loan—One Wilshire Whole Loan” in the Preliminary Prospectus.
Whole Loan Summary | ||||||
Note | Original Balance | Cut-off Date Balance | Note Holder | Controlling Piece | ||
A-1 | $90,000,000 | $90,000,000 | Benchmark 2022-B32(1) | No | ||
A-2 | $120,000,000 | $120,000,000 | GSBI(2) | No | ||
A-3 | $85,000,000 | $85,000,000 | GSBI(2) | No | ||
Total Senior Notes | $295,000,000 | $295,000,000 | ||||
B-1 | $94,250,000 | $94,250,000 | BMARK 2022-B32 loan specific certificates(1) | Yes | ||
Whole Loan | $389,250,000 | $389,250,000 | ||||
(1) | With respect to the One Wilshire whole loan, for so long as no One Wilshire control appraisal period is continuing with respect to the One Wilshire whole loan, as described under “Pooling and Servicing Agreement—The Directing Certificateholder” in the Preliminary Prospectus, the directing certificateholder for the One Wilshire whole loan will be the One Wilshire controlling class certificateholder (or its representative) selected by a majority of the One Wilshire controlling class certificateholders (by certificate balance, as certified by the certificate registrar from time to time as provided for in the pooling and servicing agreement). The One Wilshire controlling class will be the most subordinate class of the loan-specific certificates then-outstanding that has an aggregate certificate balance, as notionally reduced by any cumulative appraisal reductions allocable to such class, at least equal to 25% of the initial certificate balance of that class. During the continuation of a One Wilshire control appraisal period, the loan-specific certificates will no longer be permitted to exercise control or consultation rights under the related co-lender agreement, the controlling class certificateholder (or its representative) will be the directing certificateholder for the One Wilshire whole loan and will generally have the same consent and consultation rights with respect to the related whole loan as it does for the other mortgage loans in the mortgage pool. See “Description of the Mortgage Pool—The Whole Loans—The Serviced AB Whole Loans—The One Wilshire Whole Loan” in the Preliminary Prospectus. |
(2) | Expected to be contributed to one or more future securitization trusts. |
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
One Wilshire |
The One Wilshire Whole Loan capital structure is shown below:
(1) | Based on the “as-is” appraised value of $913,000,000 as of November 5, 2021. |
(2) | Based on the UW NOI of $37,510,389 and the UW NCF of $36,919,391. |
(3) | Based on the appraised value of $913,000,000, the Implied Borrower Sponsor Equity is $523,750,000. |
The Borrower. The borrower is GI TC One Wilshire, LLC, a Delaware limited liability company. The borrower is structured to be a single purpose bankruptcy-remote entity, having at least two independent directors in its organizational structure. Legal counsel to the borrower delivered a non-consolidation opinion in connection with the origination of the One Wilshire Whole Loan.
The Loan Sponsor. The loan sponsor and non-recourse guarantor is TechCore, LLC (“TechCore”), a joint venture between GI Partners (“GI”) and the California Public Employees’ Retirement System (“CalPERS”). GI is the manager of TechCore and fund manager. CalPERS is the non-controlling member. TechCore is an investment vehicle to invest in technology-advantaged real estate in the United States, including data centers, internet gateways, and corporate campuses for technology tenants, and life science properties located in primary MSAs, leased to industry leading tenants.
The Property. The One Wilshire Property is 30 story office building with a totaling 717,065 square feet of space with 661,553 square feet of net rentable area, located on an approximately 1.36-acre site at 624 South Grand Avenue in Los Angeles, California. The One Wilshire Property was originally constructed in 1967 and renovated in 1992. Additionally, there is also a 524 space five-level subterranean parking garage. As of November 1, 2021, the One Wilshire Property is 87.3% leased to a variety of tenants, the largest being CoreSite.
Major Tenants.
The largest tenant, CoreSite (176,685 square feet; 26.7% of net rentable area; 40.5% of underwritten base rent) currently operates 26 data centers across eight markets in the United States. CoreSite provides hybrid IT solutions that empower enterprises, cloud, network, and IT service providers to monetize and future-proof their digital business. CoreSite has been at the One Wilshire Property since 2007 and currently leases 35 suites. CoreSite extended its lease in August 2017. CoreSite’s lease expires in July 2029 and features three, five-year extension options each with 270-day notice periods. On December 28 2021, it was announced that American Tower, a telecommunication infrastructure focused REIT, had finalized its acquisition of CoreSite. CoreSite is now a subsidiary of American Tower and no information has been provided that there will be any proposed changes to the legal entity operating at the Property and on the relevant leases.
The second largest leased tenant, Musick Peeler (106,475 square feet; 16.1% of net rentable area; 8.4% of underwritten base rent) is a national law firm that offers representation in a wide variety of legal matters including appellate, banking and finance, corporate, business and technology, intellectual property, real estate, and trusts & estates and delivers legal services across the globe. Musick Peeler is a member of Ally Law, an alliance of international law firms. Musick Peeler has been at the One Wilshire Property since 1997 and expanded its space in 2004.
The third largest leased tenant, Verizon Global Networks (57,974 square feet; 8.8% of net rentable square feet; 12.5% of underwritten base rent) (“Verizon”) formed on June 30, 2000 and is one of the world’s leading providers of technology and communications services.
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
One Wilshire |
Verizon is headquartered in New York City and in 2020 generated revenues of approximately $128.3 billion. Verizon offers voice, data and video services and solutions on its award-winning networks and platforms, delivering on customers’ demand for mobility, reliable network connectivity, security and control. Verizon has been at the One Wilshire Property since August 1982 and expanded its space in 1986, 1990, 1998, 2003, and 2012.
The Market. The One Wilshire Property is located in Los Angeles County in the Los Angeles-Long Beach-Anaheim metropolitan statistical area (“MSA”). Los Angeles County is the most populous county in the United States with a 2010 U.S. Census population of 9,818,605, and also has one of the largest economies in the world. Los Angeles is the sixth largest data center market in the United States by square footage. Los Angeles also benefits from a large number of technology, government, financial, and defense companies with large presences in the market.
The One Wilshire is within the Financial District of Downtown Los Angeles central business district submarket. The Downtown Los Angeles central business district submarket is home to a number of professional services companies including law firms, insurance companies and consulting firms. Notable companies with a presence in the area include Deloitte, Charles Schwab, Boston Consulting Group, Spotify and CBRE. The Downtown Los Angeles County Office submarket reported a vacancy level of 21.3% and average office asking rent of $41.70 per square foot as of the third quarter of 2021. The Los Angeles county office market reported a vacancy level of 19.2% and average office rents of $43.85 per square foot as of the third quarter of 2021.
According to the appraisal, the 2020 population, population growth from 2010-2020 and average household income are presented in the chart below:
Los Angeles City | Los Angeles County | LA-Long Beach- Anaheim MSA | |
Population | 3,967,152 | 10,173,432 | 13,403,861 |
Population Growth | 4.60% | 3.61% | 4.48% |
Average Household Income | $97,592 | $101,935 | $107,748 |
Historical and Current Occupancy | ||
2019(1) | 2020(1) | Current(2) |
90.3% | 89.4% | 87.3% |
(1) | Historical Occupancies are as of December 31 of each respective year. |
(2) | Current Occupancy is as of November 1, 2021. |
COVID-19 Update. As of January 6, 2022, the One Wilshire Property is open and operating. Rent collections for the One Wilshire Property were 100.0% and 100.0% for November and December 2021, respectively. There has been no rent relief requested. As of January 6, 2022, no loan modification or forbearance requests have been made on the One Wilshire Whole Loan. The first payment date of the One Wilshire Whole Loan is February 6, 2022.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
One Wilshire |
Tenant | Ratings Moody’s/Fitch/S&P(2) | Net Rentable Area (SF) | % of Total NRA | Base Rent PSF(3) | % of Total Base Rent(3) | Lease Expiration Date |
CoreSite | NR/NR/NR | 176,685 | 26.7% | $97.78 | 40.5% | 7/31/2029 |
Musick Peeler | NR/NR/NR | 106,475 | 16.1 | $33.60 | 8.4 | 10/31/2023 |
Verizon Global Networks(4) | NR/NR/NR | 57,974 | 8.8 | $92.22 | 12.5 | Various |
Crowell, Weedon | NR/NR/NR | 43,301 | 6.5 | $33.81 | 3.4 | 12/31/2024 |
Zayo | NR/NR/NR | 32,017 | 4.8 | $55.85 | 4.2 | 10/31/2033 |
Crown Castle(5) | NR/NR/NR | 26,361 | 4.0 | $59.45 | 3.7 | Various |
Qwest Communications | NR/NR/NR | 26,308 | 4.0 | $97.95 | 6.0 | 12/31/2025 |
Level 3(6) | NR/NR/NR | 20,326 | 3.1 | $93.72 | 4.5 | Various |
China Telecom | NR/NR/NR | 11,066 | 1.7 | $58.97 | 1.5 | 9/30/2022 |
GI TC One Wilshire Services (MMR Operated by CoreSite) | NR/NR/NR | 10,848 | 1.6 | $106.33 | 2.7 | 7/31/2031 |
Total | 511,361 | 77.3% | $72.96 | 87.4% | ||
Remaining Tenants | 65,968 | 10.0 | $81.77 | 12.6 | ||
Total Occupied | 577,329 | 87.3% | ||||
Vacant | 84,224 | 12.7 | ||||
Total | 661,553 | 100.0% | $73.96 | 100.0% |
(1) | Based on the underwritten rent roll dated November 1, 2021. |
(2) | In certain instances, ratings provided are those of the parent company of the entity shown, whether or not the parent company guarantees the lease. |
(3) | Base Rent PSF is inclusive of contractual rent steps underwritten through the termination option per the tenant’s lease. |
(4) | Verizon Global Networks leases 24,283 square feet expiring July 31, 2029, 18,835 square feet expiring December 14, 2026, 7,905 square feet expiring December 14, 2023, 4,698 square feet expiring August 21, 2030, 2,253 square feet expiring April 30, 2025 and antenna space expiring July 31, 2022. |
(5) | Crown Castle leases 14,199 square feet expiring December 31, 2025 and 12,162 on a month to month basis. |
(6) | Level 3 leases 10,318 square feet expiring April 30, 2023 and 10,008 square feet expiring November 30, 2026. |
Lease Rollover Schedule(1)(2)(3) | |||||||||||
Year | Number of Tenant Leases Expiring | Net Rentable Area Expiring | % of NRA Expiring | Base Rent Expiring(4) | % of Base Rent Expiring | Cumulative Net Rentable Area Expiring | Cumulative % of NRA Expiring | Cumulative Base Rent Expiring | Cumulative % of Base Rent Expiring | ||
Vacant | NAP | 84,224 | 12.7% | NAP | NAP | 84,224 | 12.7% | NAP | NAP | ||
MTM | 6 | 12,162 | 1.8 % | $370,342 | 0.9 % | 96,386 | 14.6 % | $370,342 | 0.9 % | ||
2022 | 10 | 21,101 | 3.2 % | $1,393,624 | 3.3 % | 117,487 | 17.8 % | $1,763,965 | 4.1 % | ||
2023 | 15 | 137,204 | 20.7 % | $6,238,286 | 14.6 % | 254,691 | 38.5 % | $8,002,252 | 18.7 % | ||
2024 | 8 | 46,163 | 7.0 % | $1,645,896 | 3.9 % | 300,854 | 45.5 % | $9,648,148 | 22.6 % | ||
2025 | 16 | 63,034 | 9.5 % | $5,770,068 | 13.5 % | 363,888 | 55.0 % | $15,418,216 | 36.1 % | ||
2026 | 8 | 38,052 | 5.8 % | $3,488,714 | 8.2 % | 401,940 | 60.8 % | $18,906,930 | 44.3 % | ||
2027 | 1 | 0 | 0.0 % | $0 | 0.0 % | 401,940 | 60.8 % | $18,906,930 | 44.3 % | ||
2028 | 0 | 0 | 0.0 % | $0 | 0.0 % | 401,940 | 60.8 % | $18,906,930 | 44.3 % | ||
2029 | 36 | 200,968 | 30.4 % | $19,494,511 | 45.7 % | 602,908 | 91.1 % | $38,401,441 | 89.9 % | ||
2030 | 4 | 15,780 | 2.4 % | $1,358,824 | 3.2 % | 618,688 | 93.5 % | $39,760,265 | 93.1 % | ||
2031 | 1 | 10,848 | 1.6 % | $1,153,482 | 2.7 % | 629,536 | 95.2 % | $40,913,747 | 95.8 % | ||
2032 and Thereafter | 5 | 32,017 | 4.8 % | $1,788,285 | 4.2 % | 661,553 | 100.0 % | $42,702,032 | 100.0 % | ||
Total | 110 | 661,553 | 100.0% | $42,702,032 | 100.0% | ||||||
(1) | Based on the underwritten rent roll dated November 1, 2021. |
(2) | Lease Rollover Schedule is based on the lease expiration dates of all direct leases in place. |
(3) | Certain tenants may have termination or contraction options (which may become exercisable prior to the originally stated expiration date of the tenant lease) that are not considered in the above Lease Rollover Schedule. See “Tenant Summary” above. |
(4) | Base Rent Expiring is inclusive of contractual rent steps underwritten through the termination option per the tenant’s lease. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
One Wilshire |
Operating History and Underwritten Net Cash Flow | ||||||
2019 | 2020 | T-12 9/30/2021 | Underwritten | Per Square Foot | %(1) | |
Base Rent(2) | 38,070,245 | 40,022,711 | 40,990,035 | 42,702,032 | $64.55 | 69.4% |
Other Income(3) | 7,507,780 | 7,717,265 | 7,842,263 | 8,182,721 | 12.37 | 13.2% |
Potential Income from Vacant Space | 0 | 0 | 0 | 6,902,000 | 10.43 | 11.2% |
Gross Potential Revenue | $48,100,800 | $51,060,178 | $52,501,081 | $61,511,882 | $92.98 | 100.0% |
Total Reimbursements | 2,522,775 | 3,320,201 | 3,668,783 | 3,725,129 | $5.63 | 6.1% |
(Vacancy/Credit Loss) | (968,281) | (195,262) | (336,103) | (6,902,000) | ($10.43) | (11.2%) |
Effective Gross Income | $47,132,520 | $50,864,916 | $52,164,978 | $54,609,882 | $82.55 | 100.0% |
Total Expenses | 15,521,713 | 16,294,726 | 16,537,821 | 17,099,493 | 25.85 | 31.3% |
Net Operating Income | $31,610,806 | $34,570,190 | $35,627,157 | $37,510,389 | $56.70 | 68.7% |
Total TI/LC, RR | 0 | 0 | 0 | 590,998 | $0.89 | 1.1% |
Net Cash Flow | $31,610,806 | $34,570,190 | $35,627,157 | $36,919,391 | $55.81 | 67.6% |
(1) | % column represents percent of Net Rental Income for all revenue lines and represents percent of Effective Gross Income for the remainder of the fields. |
(2) | Underwritten Base Rent is based on the underwritten rent roll as of November 1, 2021. |
(3) | Other income includes Conduit, Generator, Condenser Water, Fluid Chiller, Junction Box, Roof & Antenna, Meet-Me-Room, Parking and Storage. |
Property Management. The One Wilshire Property is managed by GI Property Manager (CA) Inc., a Delaware corporation.
Escrows and Reserves. At loan origination, the borrower was not require to deposit reserves.
Tax Reserve - The borrower is required to deposit into a real estate tax reserve, on a monthly basis, 1/12th of the reasonably estimated annual real estate taxes unless the borrower timely pays such taxes and promptly provides to the lender evidence of such payment reasonably acceptable to the lender and there is no continuing material event of default for a period in excess of 30 or more consecutive days.
Insurance Reserve - The borrower is required to deposit into an insurance reserve, on a monthly basis, 1/12th of reasonably estimated insurance premiums unless the borrower maintains a blanket policy in accordance with the One Wilshire Whole Loan documents and the borrower provides proof of payment of the applicable insurance premiums.
Capital Expenditures Reserve - The borrower is required to deposit into a capital expenditures reserve during the continuance of a One Wilshire Cash Sweep Period (as defined below), an amount equal to approximately $9,923 for capital expenditures in accordance with the One Wilshire Whole Loan documents. Amounts are disbursed from the capital expenditures reserve for capitalized expenditures (including expenditures for building improvements or major repairs, leasing commissions and tenant improvements) at the One Wilshire Property in accordance with the One Wilshire Whole Loan documents.
CoreSite Funds Reserve - Within 30 days after a binding decision is made in relation to the pending arbitration with tenant CoreSite regarding certain disputed prior CAM charges of approximately $1.8 million, the Borrower is required to (i) provide the lender with written evidence of such decision and (ii) to the extent the annual underwritable cash flow is less than the origination date net operating income (“NOI”) as of such date as a result of the decision from the related arbitration or any amendments to the leases entered with CoreSite as a consequence of the decision from the related arbitration, deposit into a CoreSite funds reserve an amount equivalent to the difference between the CoreSite underwritten annual expense reimbursements and the amount of any reduced annual expense reimbursements to be paid by CoreSite for the immediately subsequent 12 month period under the terms of its leases (the "Required Minimum Balance"). To the extent the amount of annual expense reimbursements to be paid by CoreSite are subject to adjustment under the terms of its leases, the borrower agrees to deposit within thirty 30 days of any adjustment any shortfall such that the balance maintained in the CoreSite funds reserve is always equal to Required Minimum Balance.
Operating Expense Funds Reserve - The borrower is required to deposit into an operating expense funds reserve during the continuance of a One Wilshire Cash Sweep Period, an amount equal to the aggregate amount of approved operating expenses and approved extraordinary expenses to be incurred by the borrower for the then current interest period in accordance with the One Wilshire Whole Loan documents. The lender is required to disburse the operating expense funds to the borrower to pay approved operating expenses and approved extraordinary expenses upon the borrower's request (which such request must be accompanied by an officer's certificate detailing the applicable expenses to which the requested disbursement relates and attesting that such expense will be paid with the requested disbursement).
Lease Sweep Reserve - The borrower is required to deposit into a lease sweep reserve during the continuance of a One Wilshire Cash Sweep Period, an amount equal to approximately $41,347 for leasing expenses in accordance with the One Wilshire Whole Loan documents. Amounts are disbursed from the lease sweep reserve for leasing space at the One Wilshire Property pursuant to leases
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
One Wilshire |
entered into in accordance with the One Wilshire Whole Loan documents, including leasing commissions, concessions and improvements in accordance with the One Wilshire Whole Loan documents.
Excess Cash Flow Reserve - The borrower is required to deposit into an excess cash flow reserve during the continuance of a One Wilshire Cash Sweep Period, any excess cash flow in accordance with the One Wilshire Whole Loan documents. Amounts are disbursed from the excess cash flow reserve in accordance with the One Wilshire Whole Loan documents.
A "One Wilshire Cash Sweep Period" means a period (i) commencing upon any of (a) the occurrence and continuance of an event of default, (b) the debt yield falls below 7.0% as of the end of any fiscal quarter (each, a "Debt Yield Cash Sweep Trigger Event"), or (c) the exercise of the extension option; and (ii) expiring upon (x) with regard to any One Wilshire Cash Sweep Period commenced in connection with clause (a) above, the cure or waiver (if applicable) of such event of default, (y) with regard to any One Wilshire Cash Sweep Period commenced in connection with clause (b) above, at such time as the debt yield has equaled or exceeded 7.0% for two (2) consecutive fiscal quarters or, to the extent the borrower provides evidence that the sole reason a Debt Yield Cash Sweep Trigger Event occurs is a vacating data center underwriting adjustment or a vacating non-data center underwriting adjustment, each as more particularly described in the One Wilshire Whole Loan documents, the amount of funds deposited in the excess cash flow account as a result of the related Debt Yield Cash Sweep Trigger Event is equal to the applicable Excess Cash Flow Account Threshold Amount (as defined below) or (z) with regard to any One Wilshire Cash Sweep Period commenced in connection with clause (c) above, the payment in fully of the outstanding debt. Notwithstanding the foregoing, a One Wilshire Cash Sweep Period will not be deemed to expire in the event that a One Wilshire Cash Sweep Period then exists for any other reason.
"Excess Cash Flow Account Threshold Amount" means, (i) in the case of a vacating data center underwriting adjustment, $15.00 times the rentable square feet of the leased premises which is subject to a lease which caused the related vacating data center underwriting adjustment, and (ii) in the case of a vacating non-data center underwriting adjustment, $75.00 times the rentable square feet of the leased premises which is subject to a lease which caused the related vacating non-data center underwriting adjustment.
Lockbox / Cash Management. The One Wilshire Whole Loan is structured with a hard lockbox and springing cash management. The borrower was required to direct each tenant to remit all rents directly to a lender-controlled lockbox account. In addition, the borrower is required to cause all cash revenues relating to the One Wilshire Property and all other money received by the borrower or the property manager with respect to The One Wilshire Property to be deposited into the lockbox account within two business days of receipt. On each business day during the continuance of a One Wilshire Cash Sweep Period under the One Wilshire Whole Loan, all amounts in the lockbox account are required to be remitted to the cash management account. To the extent no One Wilshire Cash Sweep Period is continuing, all funds in the lockbox account are required to be transferred to the borrower’s operating account.
Prior to the ARD, on each due date during the continuance of a One Wilshire Cash Sweep Period under the One Wilshire Whole Loan, all funds on deposit in the cash management account after the application of such funds in accordance with the One Wilshire Whole Loan documents are required to be held by the lender in the excess cash flow reserve as additional collateral for the One Wilshire Loan and disbursed in accordance with the One Wilshire Whole Loan documents. If the One Wilshire Whole Loan is not paid by the ARD, from and after the ARD, the One Wilshire Whole Loan will accrue interest at the Adjusted Interest Rate; however, interest accrued at the excess of the Adjusted Interest Rate over the initial interest rate will be deferred. After the ARD, all amounts on deposit in the cash management account after payment of debt service, required reserves and budgeted operating expenses will be required to be applied to the prepayment of the outstanding principal balance of the One Wilshire Whole Loan, first to the One Wilshire Senior notes and then to the One Wilshire Trust Subordinate Companion Loan notes, until the outstanding principal balance has been reduced to zero, then to any excess interest until the excess interest has been reduced to zero and then to any other indebtedness due under the One Wilshire Whole Loan until the other indebtedness has been reduced to zero.
Current Mezzanine or Subordinate Indebtedness. None.
Future Mezzanine or Subordinate Indebtedness Permitted. None.
Partial Release. Not permitted.
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
SVEA New Mexico Portfolio |
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
SVEA New Mexico Portfolio |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
SVEA New Mexico Portfolio |
Mortgage Loan Information | Property Information | |||
Mortgage Loan Seller: | GACC | Single Asset / Portfolio: | Portfolio | |
Original Principal Balance: | $78,550,000 | Title: | Fee | |
Cut-off Date Principal Balance: | $78,550,000 | Property Type - Subtype: | Office – Suburban | |
% of Pool by IPB: | 4.4% | Net Rentable Area (SF): | 652,850 | |
Loan Purpose: | Acquisition | Location(2): | Various, NM | |
Borrower: | SPONM DB LLC | Year Built / Renovated(2): | Various / NAP | |
Guarantor: | SVEA Real Estate Group, LLC | Occupancy: | 97.2% | |
Interest Rate: | 3.80700% | Occupancy Date: | 1/5/2022 | |
Note Date: | 1/5/2022 | Number of Tenants: | 21 | |
Maturity Date: | 1/6/2032 | Fourth Most Recent NOI: | $9,655,004 (December 31, 2018) | |
Interest-only Period: | 120 months | Third Most Recent NOI: | $9,723,143 (December 31, 2019) | |
Original Term: | 120 months | Second Most Recent NOI: | $10,416,305 (December 31, 2020) | |
Original Amortization: | None | Most Recent NOI: | $10,128,341 (TTM October 31, 2021) | |
Amortization Type: | Interest Only | UW Economic Occupancy: | 95.0% | |
Call Protection: | L(25),D(90),O(5) | UW Revenues: | $13,459,517 | |
Lockbox / Cash Management: | Hard / Springing | UW Expenses: | $3,743,620 | |
Additional Debt: | N/A | UW NOI: | $9,715,898 | |
Additional Debt Balance: | N/A | UW NCF: | $8,929,187 | |
Additional Debt Type: | N/A | Appraised Value / Per SF: | $120,890,000 / $185 | |
Appraisal Date: | 10/20/2021 | |||
Escrows and Reserves(1) | Financial Information | ||||||
Initial | Monthly | Initial Cap | Cut-off Date Loan / SF: | $120 | |||
Taxes: | $172,088 | $57,363 | N/A | Maturity Date Loan / SF: | $120 | ||
Insurance: | $18,166 | $18,166 | N/A | Cut-off Date LTV: | 65.0% | ||
Replacement Reserves: | $0 | $22,306 | $1,070,688 | Maturity Date LTV: | 65.0% | ||
TI/LC: | $500,000 | Springing | $7,834,197 | UW NCF DSCR: | 2.95x | ||
Other: | $571,303 | 0 | N/A | UW NOI Debt Yield: | 12.4% | ||
Sources and Uses | ||||||
Sources | Proceeds | % of Total | Uses | Proceeds | % of Total | |
Loan Amount | $78,550,000 | 63.5% | Purchase Price | $119,082,570 | 96.2% | |
Sponsor Equity | 45,191,725 | 36.5 | Closing Costs | 3,397,597 | 2.7 | |
Upfront Reserves | 1,261,558 | 1.0 | ||||
Total Sources | $123,741,725 | 100.0% | Total Uses | $123,741,725 | 100.0% |
(1) | For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” herein. |
(2) | See “Portfolio Summary” table herein. |
The Loan. The SVEA New Mexico Portfolio mortgage loan (the “SVEA New Mexico Portfolio Loan”) is secured by the borrower’s fee interest in a portfolio of 40 suburban office properties totaling 652,850 square feet located across New Mexico (the “SVEA New Mexico Portfolio Properties”). The SVEA New Mexico Portfolio Loan was originated by DBR Investments Co. Limited on January 5, 2022 and accrues interest at 3.80700% per annum. The SVEA New Mexico Portfolio Loan has a 10-year term and is interest only for the entire term.
The Borrower. The borrower is SPONM DB LLC, a Delaware limited liability company with two independent directors. Legal counsel to the borrower delivered a non-consolidation opinion in connection with the origination of the SVEA New Mexico Portfolio Loan. The borrowing entity is owned by SPONM Holdings LLC, a Texas limited liability company (“Sole Member”) and managed by Harry J. Kuper Jr. SVEA NM LLC, a Texas limited liability company, along with two other equity partners, Goodland, LLC (36.5%) and CrowdOut Nuevo LLC (36.6%), own the Sole Member. SVEA NM LLC is 100% owned by SVEA Real Estate Group, LLC.
The Loan Sponsor. The loan sponsor and non-recourse carve-out guarantor is SVEA Real Estate Group, LLC. SVEA Real Estate Group, LLC is 100% indirectly owned by Netherlands entity, Dorco International B.V., which is 100% owned by Mikael Andersson, a citizen of Sweden. SVEA Real Estate Group, LLC, a Delaware limited liability company, is the American company in his portfolio which owns 49
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
SVEA New Mexico Portfolio |
total commercial and residential properties totaling approximately 597,000 square feet, which is not inclusive of the SVEA New Mexico Portfolio Properties.
The Properties. The SVEA New Mexico Portfolio Properties consists of 40 suburban office buildings totaling 652,850 square feet located across New Mexico. The SVEA New Mexico Portfolio Properties were built between 1997 and 2009 and range from 4,241 to 44,623 square feet, with an average size of 16,321 square feet. No single property accounts for more than 6.8% of the net rentable area and no property accounts for more than 8.3% of the UW base rent.
As of January 5, 2022, the SVEA New Mexico Portfolio Properties were 97.2% occupied by 21 tenants, with government tenants accounting for 91.8% of the net rentable area and 96.2% of the UW base rent. Within the SVEA New Mexico Portfolio, 86.7% of the net rentable area is leased to the State of New Mexico (Moody’s: Aa2; S&P: AA) and 5.1% of the net rentable area is leased to the United States General Services Administration (Moody’s: Aaa; Fitch: AAA; S&P: AA+).
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
SVEA New Mexico Portfolio |
The following table presents certain information relating to the SVEA New Mexico Portfolio Properties:
Portfolio Summary | |||||||||
Property Name | City | Year Built | SF | Occupancy | ALA | % of ALA | Appraised Value | UW Base Rent | % of UW Base Rent |
39 Plaza La Prensa | Santa Fe | 2001 | 38,493 | 98.7% | $6,302,713 | 8.0% | $9,700,000 | $1,145,157 | 8.3% |
1711 Randolph Road Southeast | Albuquerque | 2003 | 28,946 | 100.0% | $4,463,880 | 5.7% | 6,870,000 | $679,076 | 4.9% |
1920 Fifth Street | Santa Fe | 2004 | 29,269 | 100.0% | $4,190,979 | 5.3% | 6,450,000 | $705,383 | 5.1% |
445 Camino Del Rey Southwest | Los Lunas | 2002 | 44,623 | 100.0% | $4,190,979 | 5.3% | 6,450,000 | $750,264 | 5.5% |
3280 Bridge Boulevard Southwest | Albuquerque | 2000 | 35,032 | 100.0% | $3,768,633 | 4.8% | 5,800,000 | $594,713 | 4.3% |
37 Plaza La Prensa | Santa Fe | 2002 | 21,364 | 100.0% | $3,417,760 | 4.4% | 5,260,000 | $644,074 | 4.7% |
4363 Jager Drive Northeast | Rio Rancho | 2007 | 24,465 | 97.4% | $3,378,774 | 4.3% | 5,200,000 | $545,005 | 4.0% |
655 Utah Avenue | Las Cruces | 2002 | 21,871 | 100.0% | $3,346,286 | 4.3% | 5,150,000 | $629,243 | 4.6% |
2536 Ridge Runner Road | Las Vegas | 2001 | 25,061 | 100.0% | $2,813,479 | 3.6% | 4,330,000 | $566,278 | 4.1% |
653 Utah Avenue | Las Cruces | 2009 | 22,611 | 100.0% | $2,605,555 | 3.3% | 4,010,000 | $424,219 | 3.1% |
4359 Jager Drive Northeast | Rio Rancho | 1999 | 23,008 | 100.0% | $2,560,071 | 3.3% | 3,940,000 | $392,340 | 2.9% |
221 Llano Estacado | Clovis | 1997 | 21,412 | 96.6% | $2,241,687 | 2.9% | 3,450,000 | $389,683 | 2.8% |
1308 Gusdorf Road | Taos | 2004 | 16,512 | 100.0% | $2,046,757 | 2.6% | 3,150,000 | $343,938 | 2.5% |
2540 Camino Ortiz | Santa Fe | 2002 | 17,319 | 100.0% | $1,988,279 | 2.5% | 3,060,000 | $421,903 | 3.1% |
5500 San Antonio Drive Northeast | Albuquerque | 2004 | 20,017 | 100.0% | $1,949,293 | 2.5% | 3,000,000 | $328,895 | 2.4% |
2121 Summit Court | Las Cruces | 2007 | 12,774 | 100.0% | $1,936,297 | 2.5% | 2,980,000 | $377,705 | 2.7% |
2732 North Wilshire Boulevard | Roswell | 2007 | 11,612 | 97.2% | $1,864,823 | 2.4% | 2,870,000 | $313,917 | 2.3% |
41 Plaza La Prensa | Santa Fe | 2008 | 12,912 | 100.0% | $1,806,345 | 2.3% | 2,780,000 | $298,429 | 2.2% |
2800 Farmington Avenue | Farmington | 1999 | 14,000 | 100.0% | $1,793,349 | 2.3% | 2,760,000 | $304,371 | 2.2% |
1710 East Aztec Avenue | Gallup | 2006 | 13,168 | 97.7% | $1,741,368 | 2.2% | 2,680,000 | $313,241 | 2.3% |
5200 Oakland Avenue Northeast | Albuquerque | 2003 | 16,176 | 100.0% | $1,617,913 | 2.1% | 2,490,000 | $276,664 | 2.0% |
3316 North Main Street | Clovis | 2006 | 19,494 | 100.0% | $1,611,415 | 2.1% | 2,480,000 | $275,291 | 2.0% |
2141 Summit Court | Las Cruces | 2007 | 11,500 | 100.0% | $1,422,984 | 1.8% | 2,190,000 | $249,469 | 1.8% |
1014 North California Street | Socorro | 2003 | 10,241 | 100.0% | $1,416,486 | 1.8% | 2,180,000 | $243,776 | 1.8% |
912 Railroad Avenue | Espanola | 2005 | 16,099 | 74.1% | $1,319,021 | 1.7% | 2,030,000 | $281,016 | 2.0% |
1922 Fifth Street | Santa Fe | 2004 | 9,804 | 100.0% | $1,280,036 | 1.6% | 1,970,000 | $218,650 | 1.6% |
1017 East Roosevelt Avenue | Grants | 2001 | 9,742 | 100.0% | $1,202,064 | 1.5% | 1,850,000 | $222,048 | 1.6% |
145 Roy Road | Taos | 2007 | 13,771 | 94.1% | $1,202,064 | 1.5% | 1,850,000 | $240,461 | 1.7% |
1800 East 30th Street | Farmington | 2006 | 11,137 | 34.3% | $1,143,585 | 1.5% | 1,760,000 | $82,546 | 0.6% |
5205 Quail Road Northwest | Albuquerque | 2002 | 6,659 | 100.0% | $961,651 | 1.2% | 1,480,000 | $147,125 | 1.1% |
501 East Bender Boulevard | Hobbs | 2008 | 6,697 | 86.9% | $909,670 | 1.2% | 1,400,000 | $159,851 | 1.2% |
1233 Whittier Street | Raton | 2002 | 6,007 | 94.6% | $890,177 | 1.1% | 1,370,000 | $148,756 | 1.1% |
2520 Ridge Runner Road | Las Vegas | 2002 | 5,940 | 100.0% | $857,689 | 1.1% | 1,320,000 | $160,147 | 1.2% |
26387 US Highway 70 | Ruidoso Downs | 1998 | 12,907 | 100.0% | $857,689 | 1.1% | 1,320,000 | $165,440 | 1.2% |
475 Courthouse Road Southeast | Los Lunas | 2005 | 14,735 | 89.0% | $779,717 | 1.0% | 1,200,000 | $187,867 | 1.4% |
7905 Marble Avenue Northeast | Albuquerque | 2007 | 6,312 | 100.0% | $688,750 | 0.9% | 1,060,000 | $131,661 | 1.0% |
2215 West Main Street | Artesia | 2006 | 7,795 | 93.8% | $662,760 | 0.8% | 1,020,000 | $133,455 | 1.0% |
2522 Ridge Runner Road | Las Vegas | 2005 | 4,391 | 100.0% | $519,811 | 0.7% | 800,000 | $112,929 | 0.8% |
1710 Rio Bravo Boulevard Southwest | Albuquerque | 2004 | 4,733 | 100.0% | $493,821 | 0.6% | 760,000 | $88,412 | 0.6% |
312 East Nizhoni Boulevard | Gallup | 2004 | 4,241 | 92.4% | $305,389 | 0.4% | 470,000 | $67,020 | 0.5% |
Total / Wtd. Avg. | 652,850 | 97.2% | $78,550,000 | 100.0% | $120,890,000 | $13,760,419 | 100.0% |
The top five tenants in the SVEA New Mexico Portfolio Properties are all government credit tenants, with the largest tenant being the State of New Mexico (86.7% of the NRA; Moody’s: Aa2, S&P: AA). The top four State of New Mexico agencies at the SVEA New Mexico Portfolio Properties are the following: NM Human Services Dept. (16 leases, 47.3% of total NRA), NM Children, Youth, & Families Dept. (“CYFD”; 10 leases, 22.6% of total NRA), NM Division of Vocational Rehab (six leases, 3.7% of total NRA), and NM Regulation & Licensing Dept. (one lease, 3.1% of total NRA). Included in the top tenants is GSA Social Security Admin (“SSA”; four leases, 5.1% of total NRA). Since 2011, the SVEA New Mexico Portfolio has had an average occupancy of 96.7%. Throughout the occupancy history of the SVEA New Mexico Portfolio, only 10 tenants have ever turned over with eight of those 10 tenants backfilled by switching from one state agency to another state agency.
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 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
SVEA New Mexico Portfolio |
COVID-19 Update. As of January 5, 2022, the SVEA New Mexico Portfolio Properties were open and operating. No rent relief has been requested. As of January 5, 2022, no loan modification or forbearance requests have been made on the SVEA New Mexico Portfolio Whole Loan. The first payment date of the SVEA New Mexico Portfolio Whole Loan is in February 2022.
The Market. The SVEA New Mexico Portfolio Properties are primarily located in four office markets: Albuquerque, Sante Fe, Las Cruces and Farmington.
The following table presents certain information relating to the SVEA New Mexico Portfolio Properties’ market statistics:
Market Overview(1)(2) | ||||
Market | NRA | Vacancy Rate | Market Rent | Net Absorption |
Albuquerque | 38,675,892 | 6.7% | $17.47 | 146,800 |
Santa Fe | 7,168,976 | 3.4% | $21.56 | 58,155 |
Las Cruces | 4,375,703 | 6.7% | $18.45 | 42,418 |
Farmington | 1,293,734 | 5.2% | $20.90 | 0 |
(1) | Source: Appraisal. |
(2) | Market statistics as of the third quarter of 2021. |
Historical and Current Occupancy | |||
2018(1) | 2019(1) | 2020(1) | Current(2) |
96.0% | 96.0% | 96.0% | 97.2% |
(1) | Historical Occupancies are as of December 31 of each respective year. |
(2) | Current Occupancy is as of January 5, 2022. |
Tenant Summary(1) | |||||||
Tenant | Building | Ratings | Net Rentable Area (SF) | % of | Base Rent PSF(3) | % of Total | Lease |
Moody’s/Fitch/S&P(2) | Total NRA | Base Rent | Expiration Date | ||||
NM Human Services Dept(3) | Various | Aa2 / NR / AA | 308,619 | 47.3% | $23.02 | 51.6% | Various |
NM Children, Youth, & Families Dept(3) | Various | Aa2 / NR / AA | 147,257 | 22.6% | $20.69 | 22.1% | Various |
Social Security Admin(4) | Various | Aaa / AAA / AA+ | 33,064 | 5.1% | $23.84 | 5.7% | Various |
NM Division of Vocational Rehab(3) | Various | Aa2 / NR / AA | 23,844 | 3.7% | $19.31 | 3.3% | Various |
NM Regulation & Licensing Dept(3) | 5500 San Antonio Dr. NE | Aa2 / NR / AA | 20,017 | 3.1% | $16.43 | 2.4% | 7/31/2025 |
Valencia Shelter Services | 445 Camino Del Rey SW | NR / NR / NR | 13,763 | 2.1% | $15.25 | 1.5% | 8/31/2026 |
NM Dept of Health | Various | Aa2 / NR / AA | 13,233 | 2.0% | $25.13 | 2.4% | Various |
NM Environment Dept | Various | Aa2 / NR / AA | 13,225 | 2.0% | $20.17 | 1.9% | Various |
NM State Investment Council | 41 Plaza La Prensa | Aa2 / NR / AA | 12,912 | 2.0% | $23.11 | 2.2% | 7/31/2023 |
NM Office of the State Auditor | 2540 Camino Edward Ortiz | Aa2 / NR / AA | 9,362 | 1.4% | $23.20 | 1.6% | 8/14/2025 |
Total/Wtd. Avg. | 595,296 | 91.2% | $21.93 | 94.9% | |||
Other Occupied | 39,144 | 6.0% | $18.04 | 5.1% | |||
Total Occupied | 634,440 | 97.2% | $21.69 | 100.0% | |||
Vacant | 18,410 | 2.8% | |||||
Total | 652,850 | 100.0% |
(1) | Based on the underwritten rent roll dated January 5, 2022. |
(2) | In certain instances, ratings provided are those of the parent company or government of the entity shown, whether or not the parent company or government guarantees the lease. |
(3) | The State of New Mexico leases will terminate prior to the end of the lease term, without penalty to the tenant and with 90 days’ notice to the landlord, upon the occurrence of one or more of the following events: (i) the New Mexico legislature fails to grant sufficient authority and appropriations to the tenant to carry out the terms and conditions of the lease, (ii) the governor of New Mexico, pursuant to executive order, or the New Mexico legislature, pursuant to statute, eliminates or transfers employees or functions of the tenant or (iii) the State of New Mexico builds a new building or purchases or otherwise acquires an existing building and includes space in such new or existing building for the tenant. |
(4) | The tenant may terminate the following leases, in whole or in part, at any time effective after the firm term of the lease (as specified below), by providing not less than 90 days' prior written notice to the landlord: (i) 2141 Summit Court property (February 17, 2026), (ii) 1922 Fifth Street property (January 31, 2029), (iii) 501 East Bender Boulevard property (November 30, 2032) and (iv) 2520 Ridge Runner Road (February 26, 2030). |
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.
67 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
SVEA New Mexico Portfolio |
Lease Rollover Schedule(1)(2) | |||||||||||
Year | Number of Leases Expiring | Net Rentable Area Expiring | % of NRA Expiring | Base Rent Expiring | % of Base Rent Expiring | Cumulative Net Rentable Area Expiring | Cumulative % of NRA Expiring | Cumulative Base Rent Expiring | Cumulative % of Base Rent Expiring | ||
Vacant | NAP | 18,410 | 2.8% | NAP | NAP | 18,410 | 2.8% | NAP | NAP | ||
MTM & 2022 | 11 | 85,322 | 13.1% | $2,116,948 | 15.4% | 103,732 | 15.9% | $2,116,948 | 15.4% | ||
2023 | 8 | 131,915 | 20.2% | 3,474,367 | 25.2% | 235,646 | 36.1% | $5,591,316 | 40.6% | ||
2024 | 5 | 21,441 | 3.3% | 451,359 | 3.3% | 257,087 | 39.4% | $6,042,675 | 43.9% | ||
2025 | 4 | 51,863 | 7.9% | 859,832 | 6.2% | 308,950 | 47.3% | $6,902,507 | 50.2% | ||
2026 | 5 | 45,892 | 7.0% | 805,524 | 5.9% | 354,842 | 54.4% | $7,708,032 | 56.0% | ||
2027 | 8 | 139,518 | 21.4% | 2,644,634 | 19.2% | 494,360 | 75.7% | $10,352,665 | 75.2% | ||
2028 | 4 | 30,461 | 4.7% | 657,904 | 4.8% | 524,821 | 80.4% | $11,010,569 | 80.0% | ||
2029 | 9 | 65,088 | 10.0% | 1,344,798 | 9.8% | 589,909 | 90.4% | $12,355,367 | 89.8% | ||
2030 | 5 | 42,168 | 6.5% | 911,891 | 6.6% | 632,077 | 96.8% | $13,267,258 | 96.4% | ||
2031 | 3 | 14,953 | 2.3% | 333,310 | 2.4% | 647,030 | 99.1% | $13,600,568 | 98.8% | ||
2032 and Thereafter | 1 | 5,820 | 0.9% | 159,851 | 1.2% | 652,850 | 100.0% | $13,760,419 | 100.0% | ||
Total | 63 | 652,850 | 100.0% | $13,760,419 | 100.0% | ||||||
(1) | Based on the underwritten rent roll dated January 5, 2022. |
(2) | Certain tenants may have termination or contraction options (which may become exercisable prior to the originally stated expiration date of the tenant lease) that are not considered in the above Lease Rollover Schedule. |
Operating History and Underwritten Net Cash Flow | |||||||
2018 | 2019 | 2020 | TTM October 2021 | Underwritten | Per Square Foot | %(1) | |
Base Rent(2) | $13,183,721 | $13,372,993 | $13,731,039 | $13,639,089 | $13,760,419 | $21.08 | 97.1% |
Rent Steps(3) | 0 | 0 | 0 | 0 | 12,747 | $0.02 | 0.1% |
Potential Income from Vacant Space | 0 | 0 | 0 | 0 | 394,747 | $0.60 | 2.8% |
Gross Potential Rent | $13,183,721 | $13,372,993 | $13,731,039 | $13,639,089 | $14,167,913 | $21.70 | 100.0% |
Total Reimbursements | 0 | 0 | 0 | 0 | 0 | $0.00 | 0.0% |
Total Other Income | 0 | 0 | 0 | 0 | 0 | $0.00 | 0.0% |
Net Rental Income | $13,183,721 | $13,372,993 | $13,731,039 | $13,639,089 | $14,167,913 | $21.70 | 100.0% |
(Vacancy/Credit Loss) | 0 | 0 | 0 | 0 | (708,396) | ($1.09) | (5.0%) |
Effective Gross Income | $13,183,721 | $13,372,993 | $13,731,039 | $13,639,089 | $13,459,517 | $20.62 | 95.0% |
Total Expenses | 3,528,717 | 3,649,850 | 3,314,734 | 3,510,748 | 3,743,620 | $5.73 | 27.8% |
Net Operating Income | $9,655,004 | $9,723,143 | $10,416,305 | $10,128,341 | $9,715,898 | $14.88 | 72.2% |
TI/LC | 0 | 0 | 0 | 0 | 519,043 | $0.80 | 3.9% |
Capital Expenditures | 0 | 0 | 0 | 0 | 267,668 | $0.41 | 2.0% |
Net Cash Flow | $9,655,004 | $9,723,143 | $10,416,305 | $10,128,341 | $8,929,187 | $13.68 | 66.3% |
(1) | % column represents percent of Net Rental Income for all revenue lines and represents percent of Effective Gross Income for the remainder of the fields. |
(2) | Underwritten Base Rent is based on the underwritten rent roll as of January 5, 2022. |
(3) | Rent steps underwritten through November 2022. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
68 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
SVEA New Mexico Portfolio |
Property Management. The SVEA New Mexico Portfolio Properties are managed by SPONM Management LLC, an affiliate of the borrower.
Escrows and Reserves. At loan origination, the borrower deposited (i) approximately $172,088 into a real estate taxes reserve, (ii) approximately $18,166 into an insurance reserve, (iii) approximately $500,000 into a general leasing reserve, (iv) $492,473 into a current landlord leasing obligations and (v) $78,830 into an immediate repairs reserve.
Tax Reserve – The borrower is required to deposit into a real estate tax reserve, on a monthly basis, 1/12th of the estimated annual real estate taxes (initially estimated at approximately $57,363).
Insurance Reserve – The borrower is required to deposit into an insurance reserve, on a monthly basis, 1/12th of the estimated annual insurance premiums (initially estimated at approximately $18,166).
Replacement Reserve – The borrower is required to deposit into a replacement reserve, on a monthly basis, an amount equal to approximately $22,306 for replacement reserves, subject to a cap of $1,070,688. The borrower may post a letter of credit in an amount equal to the replacement reserve cap in lieu of the reserve.
TI/LC Reserve – The borrower is required to deposit into a rollover reserve, on a monthly basis, (i) if the debt service coverage ratio is below 1.80x, $68,005 and (ii) if the debt service coverage ratio is below 1.55x, $163,212, in each case subject to a cap of $7,834,197. The borrower may post a letter of credit in an amount equal to the TI/LC reserve cap in lieu of the reserve.
Lockbox / Cash Management. The SVEA New Mexico Portfolio Loan is structured with a hard lockbox and springing cash management. The borrower was required to cause all gross revenues to be transmitted directly by tenants of the SVEA New Mexico Portfolio into the lockbox account. All funds deposited into the lockbox account are required to be transferred on each business day to or at the direction of the borrower unless a Trigger Period (as defined below) exists. During the continuance of a Trigger Period, all funds in the lockbox account are required to be swept on each business day to a cash management account under the control of the lender to be applied and disbursed in accordance with the SVEA New Mexico Portfolio Loan documents, and all excess cash flow funds remaining in the cash management account after the application of such funds in accordance with the SVEA New Mexico Portfolio Loan documents are required to be held by the lender in an excess cash flow reserve account as additional collateral for the SVEA New Mexico Portfolio Loan.
A “Trigger Period” means a period (A) commencing upon the earliest to occur of (i) an event of default, (ii) the debt service coverage ratio falling below 1.25x for any calendar quarter, (iii) for so long as an approved mezzanine loan is outstanding or (iv) if the manager is an affiliate of the borrower and becomes insolvent or bankrupt and (B) expiring upon (1) with regard to any Trigger Period commenced in connection with clause (i) above, the cure (if applicable) of such event of default, (2) with regard to any Trigger Period commenced in connection with clause (ii) above, the date that the debt service coverage ratio is equal to or greater than 1.30x for two calendar quarters, (3) with regard to any Trigger Period commenced in connection with clause (iii) above, the mezzanine loan is no longer outstanding and (4) with regard to any Trigger Period commenced in connection with clause (iv) above, the manager is replaced with an unaffiliated qualified manager approved by lender.
Current Mezzanine or Subordinate Indebtedness. None.
Future Mezzanine or Subordinate Indebtedness Permitted. The related loan documents permit future mezzanine financing, subject to satisfaction of certain conditions, including among others, such mezzanine debt (i) is not in excess of $15.0 million, (ii) is subject to an intercreditor agreement acceptable to the lender, (iii) as of the date of its incurrence, does not cause the debt service coverage ratio to be less than 1.97x or the debt yield to be less than 11.0%, (iv) as of the date of its incurrence, does not cause the aggregate loan-to-value ratio, to be greater than 64.97% and (v) will be interest only and coterminous with the SVEA New Mexico Portfolio Loan. See “Description of the Mortgage Pool—Additional Indebtedness— Mezzanine Indebtedness” in the Preliminary Prospectus.
Partial Release. On any day upon not less than 30 days’ written notice, the borrower may obtain the release of a Release Parcel (as defined below), upon, but not limited to, the following conditions: (i) no event of default is continuing, (ii) the Release Parcel must be vacant and non-income producing land, (iii) the borrower must obtain a subdivision of the applicable property such that the applicable Release Parcel is a legally subdivided parcel from the applicable remaining property, (iv) with respect to the Bridge Boulevard Release Parcel (as defined below), the borrower must defease an amount of principal equal to $121,492 and satisfy the conditions in the loan documents to a defeasance, (v) with respect to the Grants Release Parcel (as defined below), (x) the borrower has delivered evidence that prior to the date of the proposed release 10 additional parking spaces are striped on the proposed remaining property to be legally conforming and/or (y) the borrower has obtained a variance or other approval for the Grants property from the applicable governmental authority causing the Grants property (excluding any parking spaces located on the Grants Release Parcel) to be legal conforming as to parking under applicable legal requirements and such variance or other approval must run with the land and (vi) satisfaction of REMIC related conditions.
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.
69 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
SVEA New Mexico Portfolio |
A “Release Parcel” means (i) a portion of the 2520 Ridge Runner Road property to be reasonably approved by the lender, which consists of no more than .09 acres as depicted on a schedule to the loan agreement, (ii) a portion of the 3280 Bridge Boulevard Southwest property to be reasonably approved by the lender, which consists of no more than 2.72 acres as depicted on a schedule to the loan agreement (“Bridge Boulevard Release Parcel”) and (iii) a portion of the 1017 East Roosevelt Avenue property to be reasonably approved by the lender, which consists of no more than 0.30 acres as depicted on a schedule to the loan agreement (“Grants Release Parcel”).
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.
70 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
JW Marriott Desert Springs |
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.
71 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
JW Marriott Desert Springs |
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.
72 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
JW Marriott Desert Springs |
Mortgage Loan Information | Property Information | |||
Mortgage Loan Seller: | GSMC | Single Asset / Portfolio: | Single Asset | |
Original Principal Balance(1): | $75,000,000 | Title: | Fee / Leasehold | |
Cut-off Date Principal Balance(1): | $75,000,000 | Property Type - Subtype: | Hospitality – Full Service | |
% of Pool by IPB: | 4.2% | Net Rentable Area (Rooms): | 884 | |
Loan Purpose: | Refinance | Location: | Palm Desert, CA | |
Borrower: | Newage Desert Springs, LLC | Year Built / Renovated: | 1987 / 2019 | |
Guarantor: | Tiffany Lam | Occupancy: | 36.8% | |
Interest Rate: | 4.99500% | Occupancy Date: | 12/31/2021 | |
Note Date: | 12/22/2021 | Number of Tenants: | NAP | |
Maturity Date: | 1/6/2027 | Fourth Most Recent NOI: | $23,174,262 (December 31, 2018) | |
Interest-only Period: | 60 months | Third Most Recent NOI: | $20,804,350 (December 31, 2019) | |
Original Term: | 60 months | Second Most Recent NOI: | ($54,690) (December 31, 2020) | |
Original Amortization: | None | Most Recent NOI(5): | $12,620,916 (December 31, 2021) | |
Amortization Type: | Interest Only | UW Economic Occupancy: | 63.5% | |
Call Protection(2): | L(25),D(30),O(5) | UW Revenues: | $126,226,398 | |
Lockbox / Cash Management: | Soft / Springing | UW Expenses: | $100,165,283 | |
Additional Debt(1): | Yes | UW NOI(6): | $26,061,115 | |
Additional Debt Balance(1): | $53,000,000 | UW NCF: | $20,380,927 | |
Additional Debt Type(1): | Pari Passu | Appraised Value / Per Room: | $306,000,000/ $346,154 | |
Appraisal Date: | 11/17/2021 | |||
Escrows and Reserves(3) | Financial Information | |||||||||||
Initial | Monthly | Initial Cap | Whole Loan | |||||||||
Taxes: | $0 | Springing | N/A | Cut-off Date Loan / Room: | $144,796 | |||||||
Insurance: | $0 | Springing | N/A | Maturity Date Loan / Room: | $144,796 | |||||||
Replacement Reserves: | $0 | Springing | N/A | Cut-off Date LTV: | 41.8% | |||||||
Upfront Debt Service Reserve: | $6,482,400 | $0 | N/A | Maturity Date LTV: | 41.8% | |||||||
Other(4): | $0 | Springing | N/A | UW NCF DSCR: | 3.14x | |||||||
UW NOI Debt Yield: | 20.4% | |||||||||||
| ||||||||||||
Sources and Uses | ||||||||||||
Sources | Proceeds | % of Total | Uses | Proceeds | % of Total | |||||||
Loan Amount | $128,000,000 | 98.2% | Loan Payoff | $123,214,718 | 94.5% | |||||||
Sponsor Equity | 2,366,918 | 1.8 | Upfront Reserves | 6,482,400 | 5.0 | |||||||
Closing Costs | 669,880 | 0.5 | ||||||||||
Total Sources | $130,366,918 | 100.0% | Total Uses | $130,366,918 | 100.0% | |||||||
(1) | The JW Marriott Desert Springs Loan (as defined below) is part of a whole loan evidenced by two pari passu notes, with an aggregate outstanding principal balance as of the Cut-off Date of $128.0 million. The Financial Information in the chart above reflects the Cut-off Date Balance of the JW Marriott Desert Springs Whole Loan (as defined below). |
(2) | The defeasance lockout period, with respect to a defeasance of the JW Marriott Desert Springs Whole Loan, will be at least 25 payment dates beginning with and including the first payment date on February 6, 2022. Defeasance of the full $128.0 million JW Marriott Desert Springs Whole Loan is permitted after the date that is earlier of (i) two years from the closing date of the securitization that includes the last note to be securitized and (ii) December 22, 2024. The assumed lockout of 25 may be longer. |
(3) | For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below. |
(4) | Other springing reserve represents a ground rent reserve, please refer to “Escrows and Reserves” below |
(5) | The Most Recent NOI includes the trailing 11 month period ending November 2021 and the forecasted financials for December 2021. |
(6) | The increase from the Most Recent NOI ($) to Underwritten Net Operating Income ($) is primarily attributable to underwriting to average occupancy levels prior to the 2019 renovation and COVID-19 pandemic at the post-renovation ADR observed between June 2021 and November 2021. The mortgaged property’s 2021 performance reflects recovery from the COVID-19 pandemic as stay-at-home orders were lifted and travel began to rebound. We cannot assure you that the JW Marriott Desert Springs Mortgaged Property will revert to pre-COVID-19 performance. |
The Loan. The JW Marriott Desert Springs loan (the “JW Marriott Desert Springs Loan”) is part of a whole loan consisting of two pari passu notes with an aggregate outstanding principal balance as of the Cut-off Date of $128.0 million (the “JW Marriott Desert Springs Whole Loan”). The JW Marriott Desert Springs Loan, which is evidenced by the controlling Note A-1, had an original balance and has an outstanding balance as of the Cut-off Date of $75.0 million. The non-controlling Note A-2 had an original balance and has an outstanding balance as of the Cut-off Date of $53.0 million.
The JW Marriott Desert Springs Whole Loan was originated by Goldman Sachs Bank USA on December 22, 2021. The JW Marriott Desert Springs Whole Loan has a 5-year interest only term and accrues interest at a fixed rate of 4.99500% per annum. The JW Marriott
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.
73 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
JW Marriott Desert Springs |
Desert Springs Whole Loan proceeds were used to refinance the JW Marriott Desert Springs Property (as defined below), fund a debt service reserve and pay origination costs.
The JW Marriott Desert Springs Whole Loan had an initial term of 60 months and has a remaining term of 59 months as of the Cut-off Date. The scheduled maturity date of the JW Marriott Desert Springs Whole Loan is the due date in January 2027. Voluntary prepayment of the JW Marriott Desert Springs Whole Loan in whole (but not in part) is permitted on or after the due date occurring in March 2024 and without the payment of any prepayment premium. Defeasance of the JW Marriott Desert Springs Whole Loan in whole (but not in part) is permitted after the date that is the earlier of (i) two years from the closing date of the securitization that includes the last note to be securitized and (ii) December 22, 2024.
The table below summarizes the promissory notes that comprise the JW Marriott Desert Springs Whole Loan. The relationship between the holders of the JW Marriott Desert Springs Whole Loan will be governed by a co-lender agreement as described under “Description of the Mortgage Pool—The Whole Loans—The Serviced Pari Passu Whole Loans” in the Preliminary Prospectus.
Whole Loan Summary | |||||
Note | Original Balance | Cut-off Date Balance | Note Holder | Controlling Piece | |
A-1 | $75,000,000 | $75,000,000 | Benchmark 2022-B32 | Yes | |
A-2 | $53,000,000 | $53,000,000 | GSBI(1) | No | |
Whole Loan | $128,000,000 | $128,000,000 |
(1) | Expected to be contributed to one or more future securitization trusts. |
The Borrower. The borrower is Newage Desert Springs, LLC, a Delaware limited liability company. The borrower is structured to be a single purpose bankruptcy-remote entity, having two independent directors in its organizational structure. Legal counsel to the borrower delivered a non-consolidation opinion in connection with the origination of the JW Marriott Desert Springs Whole Loan.
The Loan Sponsor. The loan sponsor and non-recourse carveout guarantor is Tiffany Lam, CEO of Kam Sang Company, Inc. (“Kam Sang”).
The Property. The JW Marriott Desert Springs Property, located in north Palm Desert, is a full-service hospitality property built in 1987. The property is located in a resort and golf community within the Coachella Valley, southwest of the intersection formed by Cook Street and Country Club Drive. The JW Marriott Desert Springs Property encompasses approximately 286.30 acres and is comprised of a main hotel building (five to nine stories), a one-story spa and fitness center building, and a one-story semi-permanent pavilion tent. Parking is available in the two-level parking garage to the west of the main hotel building and several surface lots throughout the resort. Both self-park and valet parking are offered, and the valet parking operation is managed by a third-party company. Other site improvements include two golf courses, over 26 acres of waterways, various outdoor swimming pools and whirlpools, and well-maintained. The JW Marriott Desert Springs Property offers amenities including four restaurants, three bars, a poolside bar, and a coffee shop. The hotel also offers 12 indoor meeting rooms and four outdoor event spaces. The largest ballroom, the Sinatra Ballroom, is divisible into 14 separate rooms. The hotel also features a 12,000-square-foot semi-permanent pavilion tent. Recreational facilities consist of two 18-hole golf courses, a 47-treatment-room spa, 26 acres of waterways, 20 tennis courts, five outdoor pools, two outdoor whirlpools, a fitness center, a 12,000-square-foot entertainment zone, and various retail outlets. Additional amenities include a full-service business center and a rental car center. The JW Marriott Desert Springs Property carries the JW Marriott flag under a franchise agreement that expires December 31, 2022 and may be automatically renewed for four successive 10-year periods unless terminated by the operator.
The Market. The JW Marriott Desert Springs Property is located within north Palm Desert, within the Coachella Valley lodging market within the state of California. According to the appraisal, the north Palm Desert area has historically benefited from a variety of tourism and leisure attractions in the area. Tourism in the Coachella Valley is typically strongest from January through April, when the area enjoys cooler desert temperatures but a warmer climate than most other cities; the weather is especially welcoming to those visiting from the northern regions. The area is popular as a resort, golf, and tennis destination. Other leisure demand generators include Downtown Palm Springs, Fantasy Springs Resort Casino, and Agua Caliente Casino. Special events also typically play a role during key weekends. The area's major events usually occur in March or April. Over three weekends, Indio's Empire Polo Club plays hosts to the world-renowned Coachella Valley Music & Arts Festival, as well as the Stagecoach Country Music Festival. Although the festivals were canceled in 2020 and 2021 due to a resurgence of COVID-19 cases within Riverside County, they have been rescheduled to April 2022. Other key events that take place in the Coachella Valley include the BNP Paribas Open tennis championships, which were recently held in October 2021, Palm Springs International Film Festival, and LPGA Kraft Nabisco Championships. No major changes related to these attributes of the market are expected over the long term.
The Coachella Valley lodging market is comprised of approximately 14,300 hotel rooms located. As of Q4-2020, hospitality occupancy in Coachella Valley plummeted 21.9%, largely due to the onset of the COVID-19 pandemic. Prior to COVID-19, the hospitality market occupancy was 58.6% as of YE 2019. Further, from 2009-2019, the compound annual growth rates (“CAGR”) for ADR and RevPAR in Desert Springs were 2.9% and 3.8%, respectively.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
JW Marriott Desert Springs |
COVID-19 Update. As of January 6, 2022, The JW Marriott Desert Springs Property is open and operating. As of January 6, 2022, no loan modification or forbearance requests have been made on The JW Marriott Desert Springs Loan. The first payment date of The JW Marriott Desert Springs Loan is February 6, 2022.
Operating History and Underwritten Net Cash Flow | ||||||||||
2018 | 2019 | 2020 | 2021 | Underwritten(1) | Per Room | % of Total Revenue | ||||
Occupancy | 62.1% | 58.8% | 19.6% | 36.8% | 63.5% | |||||
ADR | $224.70 | $225.66 | $250.16 | $273.74 | $267.71 | |||||
RevPAR | $139.45 | $132.61 | $48.91 | $100.71 | $170.00 | |||||
Room Revenue | $44,994,854 | $42,788,499 | $15,823,875 | $32,494,411 | $54,850,861 | $62,048 | 43.5% | |||
Food & Beverage Revenue | 45,288,668 | 47,332,662 | 16,114,894 | 26,542,884 | 51,144,651 | 57,856 | 40.5% | |||
Other Departmental Revenue(2) | 17,849,499 | 18,723,007 | 9,845,701 | 15,823,366 | 20,230,886 | 22,886 | 16.0% | |||
Total Revenue | $108,133,021 | $108,844,168 | $41,784,470 | $74,860,661 | $126,226,398 | $142,790 | 100.0% | |||
Room Expense | $10,930,362 | $10,711,086 | $4,412,952 | $7,338,460 | $13,730,612 | $15,532 | 10.9% | |||
Food & Beverage Expense | 32,169,377 | 34,979,244 | 13,353,085 | 22,352,525 | 37,795,897 | 42,756 | 29.9% | |||
Other Departmental Expense | 10,442,863 | 11,254,666 | 5,518,316 | 8,431,242 | 12,161,073 | 13,757 | 9.6% | |||
Departmental Expenses | $53,542,602 | $56,944,996 | $23,284,353 | $38,122,227 | $63,687,583 | $72,045 | 50.5% | |||
% | ||||||||||
Departmental Profit | $54,590,419 | $51,899,172 | $18,500,117 | $36,738,434 | $62,538,815 | $70,745 | 49.5% | |||
Admin & General | $6,546,262 | $7,289,923 | $4,442,493 | $5,322,291 | $8,454,111 | $9,563 | 6.7% | |||
Maintenance & Repairs | 5,125,724 | 5,443,470 | 3,245,217 | 4,274,391 | 6,312,783 | 7,141 | 5.0% | |||
Utility Costs | 2,568,169 | 2,466,965 | 1,752,945 | 2,799,468 | 2,860,935 | 3,236 | 2.3% | |||
Marketing & Franchise Fee | 8,518,316 | 8,058,412 | 3,664,976 | 5,294,957 | 9,345,327 | 10,572 | 7.4% | |||
Management Fee | 3,239,126 | 3,225,036 | 1,227,506 | 2,217,417 | 3,786,792 | 4,284 | 3.0% | |||
Property Tax | 2,214,687 | 2,078,451 | 2,351,537 | 2,133,444 | 2,377,975 | 2,690 | 1.9% | |||
Insurance | 991,646 | 835,554 | 702,818 | 884,604 | 1,113,052 | 1,259 | 0.9% | |||
Other Expenses | 2,212,227 | 1,697,011 | 1,167,315 | 1,190,946 | 2,226,725 | 2,519 | 1.8% | |||
Total Expenses | $31,416,157 | $31,094,822 | $18,554,807 | $24,117,518 | $36,477,700 | $41,264 | 28.9% | |||
Net Operating Income(2) | $23,174,262 | $20,804,350 | ($54,690) | $12,620,916 | $26,061,115 | $29,481 | 20.6% | |||
FF&E | 5,944,998 | 5,912,565 | 2,250,428 | 4,065,264 | 5,680,188 | 6,426 | 4.5% | |||
Net Cash Flow | $17,229,264 | $14,891,785 | ($2,305,118) | $8,555,652 | $20,380,927 | $23,055 | 16.1% | |||
(1) | The 2021 includes the trailing 11 month period ending November 2021 and the forecasted financials for December 2021. |
(2) | The increase in Underwritten Net Operating Income is primarily attributable to underwriting to average occupancy levels prior to the 2019 renovation and COVID-19 pandemic at the post-renovation ADR observed between June 2021 and November 2021. The mortgaged property’s 2021 performance reflects recovery from the COVID-19 pandemic as stay-at-home orders were lifted and travel began to rebound. We cannot assure you that the JW Marriott Desert Springs Mortgaged Property will revert to pre-COVID-19 performance. |
Property Management. The JW Marriott Desert Springs Property is managed by Marriott Hotel Services, Inc., a third party management company.
Escrows and Reserves. At loan origination, the borrower deposited $6,482,400 into a debt service reserve. Provided no event of default is continuing, for the first year of the term of the JW Marriott Desert Springs Whole Loan, the debt service reserve will be reduced each month by 1/12th of the initial deposit.
Tax Reserve – The borrower is required to deposit into a real estate tax reserve, on a monthly basis, 1/12th of the reasonably estimated annual real estate taxes; provided, however, to the extent that amounts due for such taxes are reserved for in an account maintained by the Brand Manager (as defined below) pursuant to the Brand Management Agreement (as defined below) or are previously paid for by the Brand Manager pursuant to the Brand Management Agreement, the deposits required to be made by the borrower will be reduced on a dollar-for-dollar basis by such amounts.
Insurance Reserve – The borrower is required to deposit into an insurance reserve, on a monthly basis, 1/12th of reasonably estimated insurance premiums; provided, however, to the extent that amounts due for insurance premiums are reserved for in an account maintained by the Brand Manager pursuant to the Brand Management Agreement or are previously paid for by the Brand Manager pursuant to the Brand Management Agreement, the deposits required to be made by the borrower will be reduced on a dollar-for-dollar basis by such amounts.
Ground Rent Reserve - The borrower is required to deposit into a ground rent reserve, on a monthly basis, 1/12th of the reasonably estimated ground rents; provided, however, to the extent that amounts due for ground rents are reserved for in an account maintained by
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.
75 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
JW Marriott Desert Springs |
the Brand Manager pursuant to the Brand Management Agreement or are previously paid for by the Brand Manager pursuant to the Brand Management Agreement, the deposits required to be made by the borrower will be reduced on a dollar-for-dollar basis by such amounts.
FF&E Reserve – The borrower is required to deposit into a furniture, fixtures and equipment (“FF&E”) reserve, on a monthly basis, an amount equal to either (i) the amount mandated to be deposited under the brand management agreement in effect as of the origination of the JW Marriott Desert Springs Loan or (ii) in the event the Brand Management Agreement (as defined below) has been terminated in accordance with the terms of the JW Marriott Desert Springs Loan documents, the greater of (a) any amount mandated by any replacement Brand Management Agreement or franchise agreement then in place with respect to the JW Marriott Desert Springs Property and (b) 5.5% of revenue over the immediately preceding 12-month period.
Seasonality Reserve – The borrower is required to deposit into a seasonality reserve, on a monthly basis, all amounts then remaining after the payment of basic carrying costs, hotel taxes, delinquent interest, operating expenses and FF&E expenses; provided, however, if the available amounts then on deposit in the seasonality reserve are equal to or exceed $2,701,000, then such deposit will be waived.
Lockbox / Cash Management. The JW Marriott Desert Springs Whole Loan is structured with a soft lockbox and springing cash management. So long as the JW Marriott Desert Springs Property is subject to the Brand Management Agreement with the Brand Manager, the borrower will cause the Brand Manager, pursuant to the Brand Management Agreement, to deposit all income into a lender controlled lockbox account within one business day of receipt. In the event that the Brand Management Agreement is terminated in accordance with the JW Marriott Desert Springs Whole Loan documents or the Brand Manager is in default under the Brand Management Agreement, all income will be required to be deposited into a lender controlled lockbox account within two business days of receipt. To the extent no JW Marriott Desert Springs Trigger Period (as defined below) is continuing, all funds in the lockbox account are required to be transferred to or at the direction of the lender.
On each due date during the continuance of a JW Marriott Desert Springs Trigger Period (or, at the lender’s discretion, during an event of default under the JW Marriott Desert Springs Whole Loan), all funds on deposit in the cash management account after payment of debt service on the JW Marriott Desert Springs Whole Loan, required reserves and budgeted operating expenses are required to be deposited into an excess cash flow reserve account as additional collateral for the JW Marriott Desert Springs Whole Loan.
The “Brand Management Agreement” means a certain amended and restated management agreement between DS Hotel LLC (the borrower’s predecessor-in-interest) and Marriott International, Inc. (the “Brand Manager”), dated as of December 29, 2001, as amended.
A “JW Marriott Desert Springs Trigger Period” means each period commencing (i) following December 22, 2022, when the Debt Yield (as calculated under the JW Marriott Desert Springs Whole Loan documents), as determined as of the last day of each of two consecutive fiscal quarters, is equal to or greater than 8.0%, (ii) upon the borrower’s failure to deliver annual, quarterly or monthly financial reports as and when required under the JW Marriott Desert Springs Whole Loan documents and concluding when such reports are delivered and indicate that no other JW Marriott Desert Springs Trigger Period is continuing, or (iii) upon the occurrence of an event of default under any mezzanine loan created by the lender pursuant to the terms of the JW Marriott Desert Springs Whole Loan documents and concluding when such event of default is cured.
Current Mezzanine or Subordinate Indebtedness. None.
Future Mezzanine or Subordinate Indebtedness Permitted. None.
Partial Release. None.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
76 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Woodmore Towne Centre |
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.
77 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Woodmore Towne Centre |
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.
78 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Woodmore Towne Centre |
Mortgage Loan Information | Property Information | |||
Mortgage Loan Seller: | GSMC | Single Asset / Portfolio: | Single Asset | |
Original Principal Balance(1): | $75,000,000 | Title: | Fee | |
Cut-off Date Principal Balance(1): | $75,000,000 | Property Type - Subtype: | Retail - Anchored | |
% of Pool by IPB: | 4.2% | Net Rentable Area (SF): | 712,091 | |
Loan Purpose: | Acquisition | Location: | Glenarden, MD | |
Borrowers: | UE Woodmore TC LLC and UE | Year Built / Renovated: | 2010-2012, 2015, 2017, 2019 / NAP | |
Woodmore TC II LLC | Occupancy: | 96.7% | ||
Guarantor: | Urban Edge Properties LP | Occupancy Date: | 1/1/2022 | |
Interest Rate: | 3.39000% | Number of Tenants: | 64 | |
Note Date: | 12/23/2021 | Fourth Most Recent NOI: | $11,816,888 (December 31, 2018) | |
Maturity Date: | 1/6/2032 | Third Most Recent NOI: | $12,018,238 (December 31, 2019) | |
Interest-only Period: | 120 months | Second Most Recent NOI: | $9,241,732 (December 31, 2020) | |
Original Term: | 120 months | Most Recent NOI(3): | $8,690,348 (TTM October 31, 2021) | |
Original Amortization: | None | UW Economic Occupancy: | 95.3% | |
Amortization Type: | Interest Only | UW Revenues(4): | $17,221,570 | |
Call Protection(2): | L(25),D(91),O(4) | UW Expenses: | $4,980,705 | |
Lockbox / Cash Management: | Hard / Springing | UW NOI(3): | $12,240,865 | |
Additional Debt(1): | Yes | UW NCF: | $11,909,419 | |
Additional Debt Balance(1): | $42,200,000 | Appraised Value / Per SF(5): | $197,000,000 / $277 | |
Additional Debt Type(1): | Pari Passu | Appraisal Date: | 11/22/2021 | |
Escrows and Reserves(6) | Financial Information | ||||||||||||
Initial | Monthly | Initial Cap | |||||||||||
Taxes: | $189,670 | $189,670 | N/A | Cut-off Date Loan / SF: | $165 | ||||||||
Insurance: | $0 | Springing | N/A | Maturity Date Loan / SF: | $165 | ||||||||
Replacement Reserves: | $0 | $6,885 | $247,865 | Cut-off Date LTV(5): | 59.5% | ||||||||
TI/LC: | $0 | $29,672 | $1,068,179 | Maturity Date LTV(5): | 59.5% | ||||||||
Other(5): | $4,194,252 | $0 | N/A | UW NCF DSCR: | 2.96x | ||||||||
UW NOI Debt Yield: | 10.4% | ||||||||||||
Sources and Uses | |||||||||||||
Sources | Proceeds | % of Total | Uses | Proceeds | % of Total | ||||||||
Loan Amount | $117,200,000 | 59.5% | Purchase Price | $191,930,000 | 97.4% | ||||||||
Sponsor Equity | 79,793,357 | 40.5 | Upfront Reserves | 4,383,922 | 2.2 | ||||||||
Closing Costs | 679,435 | 0.3 | |||||||||||
Total Sources | $196,993,357 | 100.0% | Total Uses | $196,993,357 | 100.0% | ||||||||
(1) | The Woodmore Towne Centre Loan (as defined below) is part of a whole loan evidenced by three pari passu notes, with an aggregate outstanding principal balance as of the Cut-off Date of $117.2 million. The Financial Information in the chart above reflects the Cut-off Date Balance of the Woodmore Towne Centre Whole Loan (as defined below). |
(2) | The defeasance lockout period will be at least 25 payment dates beginning with and including the first payment date on February 6, 2022. Defeasance of the full $117.2 million Woodmore Towne Centre Whole Loan is permitted after the date that is earlier of (i) two years from the closing date of the securitization that includes the last note to be securitized and (ii) December 23, 2024. |
(3) | The increase from the Most Recent NOI $8,690,348 as of 10/31/2021 to Underwritten Net Operating Income $12,240,865 is primarily attributable to new leasing activity such as At Home Stores, LA Fitness, Nike, Club Pilates, Nothing Bundt Cakes, and Ledo Pizza. |
(4) | Underwritten Revenues include annual income from the payout of a $17 million tax increment fund promissory note. Please see “Real Estate and Other Tax Considerations” in the Preliminary Prospectus. |
(5) | The appraised value of $197.0 million includes an extraordinary assumption assuming the total lease expense costs are assumed to be credited to the potential buyer of the Woodmore Towne Centre Property (as defined below). The “as-is” appraised value of the Woodmore Towne Centre is $192.0 million, which results in a Cut-off date and Maturity date LTV of 61.0%. |
(6) | For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below. |
(7) | Other initial reserves represent an unfunded obligations reserve for $4,194,252.00. |
The Loan. The Woodmore Towne Centre loan (the “Woodmore Towne Centre Loan”) is part of a whole loan consisting of three pari passu notes with an aggregate outstanding principal balance as of the Cut-off Date of $117.2 million (the “Woodmore Towne Centre Whole Loan”). The Woodmore Towne Centre Loan evidenced by the controlling Note A-1, had an original balance and has an outstanding balance as of the Cut-off Date of $75.0 million. The non-controlling Notes A-2 and A-3 have an aggregate original balance and have an aggregate outstanding balance as of the Cut-off Date of $42.2 million. Only the controlling Note A-1 will be included in the mortgage pool for the Benchmark 2022-B32 mortgage 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.
79 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Woodmore Towne Centre |
The Woodmore Towne Centre Whole Loan was originated by Goldman Sachs Bank USA on December 23, 2021. The Woodmore Towne Centre Whole Loan has a 10-year interest only term and accrues interest at a fixed rate of 3.39000% per annum. The Woodmore Towne Centre Whole Loan proceeds were used to acquire the Woodmore Towne Centre Property (as defined below) and pay origination costs.
The Woodmore Towne Centre Whole Loan had an initial term of 120 months and has a remaining term of 119 months as of the Cut-off Date. The scheduled maturity date of the Woodmore Towne Centre Whole Loan is the due date in January 2032. Voluntary prepayment of the Woodmore Towne Centre Whole Loan in whole (but not in part) is permitted on or after the due date occurring in October 2031 without payment of any prepayment premium. Defeasance of the Woodmore Towne Centre Whole Loan in whole (but not in part) is permitted after the date that is earlier of (i) two years from the closing date of the securitization that includes the last note to be securitized and (ii) December 23, 2024.
The table below summarizes the promissory notes that comprise the Woodmore Towne Centre Whole Loan. The relationship between the holders of the Woodmore Towne Centre Whole Loan will be governed by a co-lender agreement as described under “Description of the Mortgage Pool—The Whole Loans—The Serviced Pari Passu Whole Loans” in the Preliminary Prospectus.
Whole Loan Summary | |||||
Note | Original Balance | Cut-off Date Balance | Note Holder | Controlling Piece | |
A-1 | $75,000,000 | $75,000,000 | Benchmark 2022-B32 | Yes | |
A-2 | $39,066,667 | $39,066,667 | GSBI(1) | No | |
A-3 | $3,133,333 | $3,133,333 | GSBI(1) | No | |
Whole Loan | $117,200,000 | $117,200,000 |
(1) | Expected to be contributed to one or more future securitization trusts. |
The Borrowers. The borrowers are UE Woodmore TC LLC and UE Woodmore TC II LLC, each a Delaware limited liability company. The borrowers are structured to be single purpose bankruptcy-remote entities, each having two independent directors in its organizational structure. Legal counsel to the borrowers delivered a non-consolidation opinion in connection with the origination of the Woodmore Towne Centre Whole Loan.
The Loan Sponsor. The loan sponsor and non-recourse carveout guarantor is Urban Edge Properties LP (“Urban Edge”). Urban Edge is a real estate investment trust focused on managing, acquiring, development and redeveloping retail real estate in urban communities across the east coast, primarily in New York, Washington DC, Philadelphia and New England, as well as California, Puerto Rico and other markets.
The Property. The Woodmore Towne Centre Property is an anchored retail center consisting of 16 buildings totaling 712,091 square feet of space located at 2250 Petrie Lane, Glenarden, Maryland (the “Woodmore Towne Centre Property”). The site includes a total of 82.83-acres, of which 75.66-acres is allocated to the shopping center and 7.17-acres is considered excess land. The improvements were completed in between 2010-2012 (main shopping center), 2015 (fitness center), 2017 (Nordstrom Rack and adjacent shops), 2019 (Silver Diner and CAVA). Additionally, there are 3,096 surface and garage and garage parking spaces, reflecting an overall parking ratio of 4.37 spaces per 1,000 square feet of gross leasable area. The Woodmore Towne Centre Property is located on the south side of Ruby Lockhart Boulevard, just west of Saint Joseph's Drive and bounded by Landover Road (Maryland Route 202) in the south and Interstate 495 (Capital Beltway) in the west.
As of January 1, 2022, The Woodmore Towne Centre Property is 96.7% occupied to 64 unique tenants.
Major Tenants.
The largest tenant, Costco (148,628 square feet; 20.9% of net rentable area; 6.6% of underwritten base rent) is the largest wholesale club operator in the United States and the world. Costco offers discount prices on a variety of bulk products including food, appliances, pharmaceuticals, clothing, and electronics. Costco operates over 780 warehouse stores serving nearly 95 million cardholders. The company owns nearly 80% of its stores. Costco’s warehouses are located throughout the United States, Canada, Mexico, Japan, Taiwan, South Korea, the UK, and Spain. Costco aims to offer its members a broad range of high-quality merchandise at consistently lower prices than they can find elsewhere. To keep inventory costs low, its merchandising strategy is to limit certain items to fast-selling models, sizes, and colors. By doing this, Costco can limit its number of stock keeping units to about 3,700 per warehouse, enabling it to hold significantly fewer items than other discount retailers, supermarkets, and supercenters. Its product lines are not static however, as it continues to expand its own Kirkland Signature brand. Costco has been at the Woodmore Towne Centre Property since October 24, 2010 and has a lease expiration date of October 31, 2030.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
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The second largest tenant, Wegmans Food Markets, Inc. (“Wegmans”) (128,813 square feet; 18.1% of net rentable area; 8.4% of underwritten base rent), was founded in 1916, is privately owned by the family of founder, John Wegman. The company is a major regional supermarket chain and private company in the U.S. Wegmans operates approximately 99 stores: 46 in New York, 18 in Pennsylvania, 12 in Virginia, nine in New Jersey, eight in Maryland, six in Massachusetts and one in North Carolina. The company generally opens two or three new stores per year, usually in the 100,000 to 140,000 square foot range, though it will build smaller stores when conditions warrant, such as the 74,000-square-foot store scheduled to open later in 2019 in the heavily populated urban area of Brooklyn, NY. However, even Wegmans’ smaller stores easily exceed the industry median size of about 45,000 square feet. In addition, a typical Wegmans store features 50,000 to 70,000 products, higher than the roughly 40,000 found in a typical supermarket. Wegmans has been at the Woodmore Towne Centre Property since October 24, 2010 and has a lease expiration date of October 31, 2035.
The third largest tenant, At Home Stores, LLC (96,446 square feet; 13.5% of net rentable area; 7.9% of underwritten base rent), is a home décor superstore. The company owns and operates over 200 stores, each averaging 105,000 square feet and mostly located off major highways in 36 states from Florida to Michigan. At Home Stores, LLC stores sell hundreds of thousands of decorating items, such as seasonal décor, framed art, baskets, silk and dried flowers, furniture, home textiles, and pottery, as well as crafts and party supplies. Over 70% of its products are unbranded, private label or specifically designed for the company. At Home Stores, LLC, which began as a single store outside of San Antonio in 1979, was acquired by in 2011 by an investment group led by certain affiliates of AEA Investors LP. At Home Stores, LLC has been at the Woodmore Towne Centre Property since June 10, 2021 and has a lease expiration date of June 30, 2031.
The Market. The Woodmore Towne Centre Property is located in Glenarden, MD, approximately 10 miles east of downtown Washington, D.C. and within the Washington D.C. metropolitan statistical area (“MSA”). Washington, D.C. is situated along the banks of the Potomac and Anacostia rivers, and is the nation’s capital and anchor of the region. It encompasses approximately 61 square miles of land. Prince George's County is a community of diverse neighborhoods with 27 unique municipalities ranging in population from fewer than 100 to as many as 50,000 people. Due to its proximity to Washington, D.C. the county also hosts many U.S. governmental facilities, such as Joint Base Andrews, a U.S. military airbase, as well as the headquarters of the United States Census Bureau. Prince George’s County has become an engine for economic growth and development including over $7 billion in infrastructure investment, retail redevelopment, significant GSA attention, tax incentives and initiatives, and a streamlined permitting and approval process to further the trends. The County has invested over $100 million into Suitland Federal Center, home to government agencies such as the US Census Bureau, Naval Maritime Intelligence Center, NOAA’s Satellite Operations, and the Bureau of Economic Analysis. Prince George’s County has received an influx of infrastructure and development investments beginning in 2013, when MGM announced the new site for their newest resort and casino, in south Prince George’s County next to National Harbor. Having opened in late 2016, the all-in cost was $1.3 billion and has created a major entertainment destination in Prince George’s County. Related to infrastructure, Prince George’s County is an integral part to the $5.6 billion MTA Purple Line contract as well as the already existing $2.4 billion Intercounty Connector.
The Woodmore Towne Centre Property is in the Northern Prince George’s County retail submarket within the larger Suburban Maryland retail market. The Northern Prince George’s County Submarket reported average retail asking rents of $23.82 per square foot as of the third quarter of 2021, an increase of 0.3% since 2020. Average asking rental rates in the Northern Prince George's County submarket have increased, ranging from $23.16 per square foot in 2016 to $23.79 per square foot in 2020, demonstrating a compounded annual growth rate of 0.7 percent. Over the next five years, average asking rents are expected to increase between $23.36 per square foot in 2021 to $25.60 per square foot in 2025.
The Suburban Maryland retail market reported average retail rents of $27.84 per square foot as of the third quarter of 2021, an increase of 0.3% over asking rents in 2020. Average asking rental rates in the Suburban Maryland retail market have increased, ranging from $26.51 per square foot in 2016 to $27.84 per square foot in 2020, demonstrating a compounded annual growth rate of 1.2%. Over the next five years, average asking rents are expected to increase between $27.84 per square foot in 2021 to $28.83 per square foot in 2025.
The vacancy rate in the Northern Prince George's County submarket at the end of the third quarter of 2021 was 6.7% and the vacancy rate of the greater Suburban Maryland retail market was 7.6%.
According to the appraisal, the 2021 population, population growth from 2000-2021 and average household income are presented in the chart below:
3 Mile Radius | 5 Mile Radius | 10 Mile Radius | |
Population | 95,131 | 279,791 | 1,169,002 |
Population Growth | 0.37% | 0.50% | 0.73% |
Average Household Income | $101,602 | $101,267 | $109,088 |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
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Historical and Current Occupancy | |||
2018(1) | 2019(1) | 2020(1) | Current(2) |
95.0% | 97.0% | 90.0% | 96.7% |
(1) | Historical Occupancies are as of December 31 of each respective year. |
(2) | Current Occupancy is as of January 1, 2022. |
COVID-19 Update. As of January 6, 2022, The Woodmore Towne Centre Property is open and operating. There has been no rent relief requested. As of January 6, 2022, no loan modification or forbearance requests have been made on The Woodmore Towne Centre Whole Loan. The first payment date of The Woodmore Towne Centre Whole Loan is February 6, 2022.
Tenant Summary(1) | |||||||||
Tenant | Ratings Moody’s/Fitch/S&P(2) | Net Rentable Area (SF) | % of Total NRA | Base Rent PSF(3) | % of Total Base Rent(3) | TTM 10/31/2021 Sales PSF(4) | Occupancy Cost | Lease Expiration Date | |
Costco | NR/NR/NR | 148,628 | 20.9% | $5.30 | 6.6% | $148,628,000 | 0.5% | 10/31/2030 | |
Wegmans Food Markets, Inc. | NR/NR/NR | 128,813 | 18.1 | $7.76 | 8.4 | $99,830,075 | 1.0% | 10/31/2035 | |
At Home Stores, LLC | NR/NR/NR | 96,446 | 13.5 | $9.75 | 7.9 | NAV | NAV | 6/30/2031 | |
Best Buy | NR/NR/NR | 45,000 | 6.3 | $20.75 | 7.9 | $29,970,000 | 3.1% | 3/31/2024 | |
LA Fitness | NR/NR/NR | 42,154 | 5.9 | $16.00 | 5.7 | NAV | NAV | 11/30/2036 | |
Nordstrom Rack | NR/NR/NR | 30,139 | 4.2 | $18.00 | 4.6 | NAV | NAV | 9/30/2027 | |
NIKE Retail Services, Inc. | NR/NR/NR | 15,000 | 2.1 | $23.00 | 2.9 | NAV | NAV | 10/31/2027 | |
Old Navy | NR/NR/NR | 14,793 | 2.1 | $20.57 | 2.6 | $3,452,544 | 8.8% | 12/31/2024 | |
Party City | NR/NR/NR | 13,372 | 1.9 | $18.17 | 2.0 | $2,742,129 | 8.9% | 1/31/2029 | |
Beauty Mart | NR/NR/NR | 9,463 | 1.3 | $29.00 | 2.3 | $1,739,783 | 15.8% | 5/31/2031 | |
Total | 543,808 | 76.4% | $11.12 | 50.9% | |||||
Remaining Tenants | 144,630 | 20.3 | $40.39 | 49.1 | |||||
Total Occupied | 688,438 | 96.7% | |||||||
Vacant | 23,653 | 3.3 | |||||||
Total | 712,091 | 100.0% | $17.27 | 100.0% |
(1) | Based on the underwritten rent roll dated January 1, 2022. |
(2) | In certain instances, ratings provided are those of the parent company of the entity shown, whether or not the parent company guarantees the lease. |
(3) | Base Rent PSF is inclusive of contractual rent steps underwritten through the termination option per the tenant’s lease. |
(4) | As provided by the loan sponsor. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Woodmore Towne Centre |
Lease Rollover Schedule(1)(2)(3) | ||||||||||||
Year | Number of Leases Expiring | Net Rentable Area Expiring | % of NRA Expiring | Base Rent Expiring(4) | % of Base Rent Expiring | Cumulative Net Rentable Area Expiring | Cumulative % of NRA Expiring | Cumulative Base Rent Expiring | Cumulative % of Base Rent Expiring | |||
Vacant | NAP | 23,653 | 3.3% | NAP | NAP | 23,653 | 3.3% | NAP | NAP | |||
MTM | 0 | 0 | 0.0 | $0 | 0.0% | 23,653 | 3.3% | $0 | 0.0% | |||
2022 | 5 | 7,463 | 1.0 | 304,104 | 2.6 | 31,116 | 4.4% | $304,104 | 2.6% | |||
2023 | 3 | 6,265 | 0.9 | 198,382 | 1.7 | 37,381 | 5.2% | $502,486 | 4.2% | |||
2024 | 5 | 69,137 | 9.7 | 1,592,058 | 13.4 | 106,518 | 15.0% | $2,094,544 | 17.6% | |||
2025 | 6 | 13,098 | 1.8 | 598,169 | 5.0 | 119,616 | 16.8% | $2,692,713 | 22.7% | |||
2026 | 9 | 22,517 | 3.2 | 1,035,183 | 8.7 | 142,133 | 20.0% | $3,727,896 | 31.4% | |||
2027 | 10 | 75,431 | 10.6 | 1,769,066 | 14.9 | 217,564 | 30.6% | $5,496,962 | 46.2% | |||
2028 | 5 | 19,234 | 2.7 | 542,356 | 4.6 | 236,798 | 33.3% | $6,039,318 | 50.8% | |||
2029 | 4 | 17,792 | 2.5 | 404,770 | 3.4 | 254,590 | 35.8% | $6,444,088 | 54.2% | |||
2030 | 3 | 154,808 | 21.7 | 1,602,653 | 13.5 | 409,398 | 57.5% | $8,046,740 | 67.7% | |||
2031 | 4 | 109,700 | 15.4 | 1,374,584 | 11.6 | 519,098 | 72.9% | $9,421,324 | 79.3% | |||
2032 and Thereafter(5) | 12 | 192,993 | 27.1 | 2,465,848 | 20.7 | 712,091 | 100.0% | $11,887,171 | 100.0% | |||
Total | 66 | 712,091 | 100.0% | $11,887,171 | 100.0% | |||||||
(1) | Based on the underwritten rent roll as of January 1, 2022 with rent steps through February 28, 2023 and excluding vacant units. |
(2) | Lease Rollover Schedule is based on the lease expiration dates of all direct leases in place. |
(3) | Certain tenants may have termination or contraction options (which may become exercisable prior to the originally stated expiration date of the tenant lease) that are not considered in the above Lease Rollover Schedule. See “Tenant Summary” above. |
(4) | Base Rent Expiring is inclusive of contractual rent steps underwritten through the termination option per the tenant’s lease. |
(5) | Includes Broadway Services (Security) for which no base rent was underwritten. |
Operating History and Underwritten Net Cash Flow | ||||||||
2018 | 2019 | 2020 | TTM 10/31/2021 | Underwritten | Per Square Foot | %(1) | ||
Base Rent(2) | $11,321,426 | $11,766,630 | $10,704,506 | $9,300,011 | $12,143,377 | $17.05 | 67.2% | |
Rent Steps(3) | 40,728 | 81,527 | (196) | 214,476 | 240,834 | $0.34 | 1.3% | |
Potential Income from Vacant Space | 0 | 0 | 0 | 0 | 284,158 | $0.40 | 1.6% | |
Gross Potential Rent(4) | $16,028,828 | $16,698,819 | $15,462,473 | $14,007,922 | $18,072,249 | $25.38 | 100.0% | |
Total Reimbursements | 3,140,777 | 3,447,944 | 3,206,480 | 2,883,582 | 3,622,156 | $5.09 | 20.0% | |
Net Rental Income | $16,140,832 | $16,698,819 | $13,890,485 | $13,876,148 | $17,221,570 | $24.18 | 100.0% | |
(Vacancy/Credit Loss) | 112,004 | 0 | (1,571,988) | (131,774) | (850,679) | ($1.19) | -4.7% | |
Total Other Income | 79,477 | 23,782 | 28,098 | 5,700 | 12,000 | 0.02 | 0.1% | |
Effective Gross Income | $16,140,832 | $16,698,819 | $13,890,485 | $13,876,148 | $17,221,570 | $24.18 | 100.0% | |
Total Expenses | $4,323,944 | $4,680,581 | $4,648,753 | $5,185,800 | $4,980,705 | $6.99 | 28.9% | |
Net Operating Income(5) | $11,816,888 | $12,018,238 | $9,241,732 | $8,690,348 | $12,240,865 | $17.19 | 71.1% | |
Total TI/LC, RR | 0 | 0 | 0 | 0 | 331,446 | 0.47 | 1.9% | |
Net Cash Flow | $11,816,888 | $12,018,238 | $9,241,732 | $8,690,348 | $11,909,419 | $16.72 | 69.2% | |
(1) | % column represents percent of Gross Potential Rent for all revenue lines and represents percent of Effective Gross Income for the remainder of the fields. |
(2) | Underwritten Base Rent is based on the underwritten rent roll as of January 1, 2022. |
(3) | Rent steps underwritten through the termination option per the tenant’s lease. |
(4) | Gross Potential Rent includes annual income from the payout of a $17 million tax increment fund promissory note. Please see “Real Estate and Other Tax Considerations” in the Preliminary Prospectus. |
(5) | The increase from the TTM 10/31/2021 NOI $8,690,348 to Underwritten Net Operating Income $12,240,865 is primarily attributable to new leasing activity such as At Home Stores, LA Fitness, Nike, Club Pilates, Nothing Bundt Cakes, and Ledo Pizza. |
Property Management. The Woodmore Towne Centre Property is managed by Heritage Partners, LLC, a third-party management company.
Escrows and Reserves. At origination, the borrowers deposited approximately (i) $189,669.57 into a real estate tax reserve and (ii) $4,194,252 into an unfunded obligations reserve.
Tax Reserve – The borrowers are required to deposit into a real estate tax reserve, on a monthly basis, 1/12th of the reasonably estimated annual real estate taxes; provided, however, that in lieu of remitting such amounts for deposit, the borrowers may fund the tax reserve by
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Woodmore Towne Centre |
delivering to the lender (i) a qualifying letter of credit in such amount or (ii) so long as no event of default is continuing, a qualifying guaranty in such amount, in each case in accordance with the Woodmore Towne Centre Whole Loan documents.
Insurance Reserve – The borrowers are required to deposit into an insurance reserve, 1/12th of reasonably estimated insurance premiums unless the borrowers maintain a blanket policy in accordance with the Woodmore Towne Centre Whole Loan documents; provided, however, that in lieu of remitting such amounts for deposit, the borrowers may fund the insurance reserve by delivering to the lender (i) a qualifying letter of credit in such amount or (ii) so long as no event of default is continuing, a qualifying guaranty in such amount, in each case in accordance with the Woodmore Towne Centre Whole Loan documents.
TI/LC Reserve – The borrowers are required to deposit into a tenant improvement and leasing commission reserve, on a monthly basis, an amount equal to $29,671.63 if the balance of the TI/LC reserve falls below $1,068,136.50 minus any termination proceeds received in connection with the termination of any leases entered into by the borrowers; provided, however, that in lieu of remitting such amounts for deposit, the borrowers may fund the TI/LC reserve by delivering to the lender (i) a qualifying letter of credit in such amount or (ii) so long as no event of default is continuing, a qualifying guaranty in such amount, in each case in accordance with the Woodmore Towne Centre Whole Loan documents.
Capital Expenditures Reserve – The borrowers are required to deposit into a capital expenditures reserve, on a monthly basis, an amount equal to $6,885.13 (1/12th of $0.20 per square foot per annum) if the balance in the capital expenditures reserve falls below an amount equal to $0.60 per square foot (excluding outparcels and standalone buildings leased to tenants responsible for the maintenance of their space so long as all maintenance of such space is the sole responsibility of the applicable tenant under its lease); provided, however, that in lieu of remitting such amounts for deposit, the borrowers may fund the capital expenditures reserve by delivering to the lender (i) a qualifying letter of credit in such amount or (ii) so long as no event of default is continuing, a qualifying guaranty in such amount, in each case in accordance with the Woodmore Towne Centre Whole Loan documents
Lockbox / Cash Management. The Woodmore Towne Centre Whole Loan is structured with a hard lockbox and springing cash management. The borrowers were required to direct each tenant to remit all rents directly to a lender-controlled lockbox account. In addition, the borrowers are required to cause all cash revenues relating to the Woodmore Towne Centre Property and all other money received by the borrowers or the property manager with respect to the Woodmore Towne Centre Property (other than tenant security deposits and cash revenues properly released to the borrowers) to be deposited into the lockbox account or a lender-controlled cash management account by the end of the second business day following receipt. At the end of each business day during the continuance of a Woodmore Towne Centre Trigger Period, an Anchor Lease Reserve Period (as defined below) or event of default under the Woodmore Towne Centre Whole Loan documents, all amounts in the lockbox are required to be remitted to the cash management account. At the end of each business day that no Woodmore Towne Centre Trigger Period, Anchor Lease Reserve Period or an event of default under the Woodmore Towne Centre Whole Loan is continuing, all amounts in the lockbox account are required to be remitted to a borrower-controlled operating account.
On each due date during the continuance of a Woodmore Towne Centre Trigger Period or Anchor Release Reserve Period (or, at the lender’s discretion, during an event of default under the Woodmore Towne Centre Whole Loan), all funds on deposit in the cash management account after payment of debt service on the Woodmore Towne Centre Whole Loan, required reserves and budgeted operating expenses are required to be deposited into an excess cash flow reserve account as additional collateral for the Woodmore Towne Centre Whole Loan.
A “Woodmore Towne Centre Trigger Period” means (i) subject to the borrowers’ right to partially defease the Woodmore Towne Centre Whole Loan, each period commencing when the debt yield (as calculated under the Woodmore Towne Centre Whole Loan documents, as determined as of the first day of any fiscal quarter, is less than 7.0% and concluding when the debt yield, determined as of the first day of each of two consecutive fiscal quarters thereafter, is equal to or greater than 7.0%, (ii) each period commencing upon the borrowers’ failure to deliver annual, quarterly or monthly financial reports as and when required under the Woodmore Towne Centre Whole Loan documents and concluding when such reports are delivered and indicate that no other Woodmore Towne Centre Trigger Period is continuing, (iii) each period commencing upon the occurrence of an event of default under any related mezzanine loan documents and concluding when such event of default is cured, and (iv) an Anchor Lease Reserve Period.
An “Anchor Lease Reserve Period” means each period that commences upon the occurrence of an Anchor Lease Trigger Event (as defined below) and concludes when an Anchor Release Replacement Event (as defined below) has occurred with respect to each Anchor Lease Trigger Event that has occurred.
An “Anchor Lease Trigger Event” means, in respect of any Anchor Lease (as defined below), (i) the occurrence of an event of default beyond any applicable grace or cure period under such Anchor Lease, (ii) the tenant thereunder or any guarantor thereof becomes the subject of a bankruptcy or similar insolvency proceedings, or (iii) the tenant thereunder delivers written notice to the borrowers of its intention to surrender, cancel or terminate a material portion of the space demised thereunder within the period equal to 12 months prior to lease expirations, or the tenant thereunder has not renewed its Anchor Lease at least 12 months prior to lease expiration.
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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An “Anchor Lease Replacement Event” means, with respect to any Anchor Lease in respect of which an Anchor Lease Trigger Event has occurred, the occurrence of, (1) with respect to an Anchor Lease Trigger Event (a) under clause (i) above, the tenant under such Anchor Lease cures the applicable event of default under its Anchor Lease, (b) under clause (ii) above, the tenant under such Anchor Lease affirms such Anchor Lease or the applicable bankruptcy or insolvency proceeding terminates, (c) under clause (iii) above, the tenant under such Anchor Lease revokes or withdraws its written notice to surrender, cancel or terminate or exercises its right to renew such Anchor Lease pursuant to an extension option or execution of an amendment or restatement to such Anchor Lease to extend the term, or (2) (x) the borrowers have entered into one or more qualifying replacement leases with respect to at least 80% of the space demised under the Anchor Lease that caused such Anchor Lease Trigger Event to have occurred and (y) after giving effect to such qualifying replacement leases, the debt yield is at least equal to the debt yield at loan origination.
An “Anchor Lease” means (i) each major lease that has a term that expires prior to the Maturity Date, (ii) the At Home Stores LLC lease, (iii) the Costco lease and (iv) the Wegmans lease.
Current Mezzanine or Subordinate Indebtedness. A certain $78,000,000 reverse 1031 exchange Promissory Note was made by UE Woodmore TC LLC in favor of the guarantor. The guarantor entered into subordination and standstill terms with the lender applicable to this note.
Future Mezzanine or Subordinate Indebtedness Permitted. None.
Partial Release. None.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Dealertrack and Divvy |
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.
86 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Dealertrack and Divvy |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Dealertrack and Divvy |
Mortgage Loan Information | Property Information | |||
Mortgage Loan Seller: | CREFI | Single Asset / Portfolio: | Portfolio | |
Original Principal Balance: | $74,500,000 | Title: | Fee | |
Cut-off Date Principal Balance: | $74,500,000 | Property Type - Subtype: | Office - Suburban | |
% of Pool by IPB: | 4.2% | Net Rentable Area (SF): | 318,832 | |
Loan Purpose: | Acquisition | Location: | Draper, UT | |
Borrower: | AREPIII DD Office Owner, LLC | Year Built / Renovated(1): | Various / NAP | |
Guarantor: | Arden Real Estate Partners III, L.P. | Occupancy: | 100.0% | |
Interest Rate: | 4.39000% | Occupancy Date(2): | Various | |
Note Date: | 12/8/2021 | Number of Tenants: | 5 | |
Maturity Date: | 1/6/2027 | Fourth Most Recent NOI(4): | NAV | |
Interest-only Period: | 60 months | Third Most Recent NOI(4): | NAV | |
Original Term: | 60 months | Second Most Recent NOI(4): | NAV | |
Original Amortization: | None | Most Recent NOI: | $7,984,230 (TTM October 31, 2021) | |
Amortization Type: | Interest Only | UW Economic Occupancy: | 95.0% | |
Call Protection: | L(25),D(31),O(4) | UW Revenues: | $9,478,285 | |
Lockbox / Cash Management: | Hard / Springing | UW Expenses: | $2,473,465 | |
Additional Debt: | N/A | UW NOI: | $7,004,821 | |
Additional Debt Balance: | N/A | UW NCF: | $6,496,185 | |
Additional Debt Type: | N/A | Appraised Value / Per SF: | $109,500,000 / $343 | |
Appraisal Date: | 11/19/2021 | |||
Escrows and Reserves(3) | Financial Information | |||||
Initial | Monthly | Initial Cap | Cut-off Date Loan / SF: | $234 | ||
Taxes: | $228,726 | $76,242 | N/A | Maturity Date Loan / SF: | $234 | |
Insurance: | $0 | Springing | N/A | Cut-off Date LTV: | 68.0% | |
Replacement Reserves: | $0 | $5,314 | N/A | Maturity Date LTV: | 68.0% | |
TI/LC: | $0 | $0 | N/A | UW NCF DSCR: | 1.96x | |
Other: | $0 | $0 | N/A | UW NOI Debt Yield: | 9.4% | |
Sources and Uses | ||||||
Sources | Proceeds | % of Total | Uses | Proceeds | % of Total | |
Loan Amount | $74,500,000 | 68.9% | Purchase Price | $106,290,000 | 98.2% | |
Principal's New Cash Contribution | 33,463,734 | 30.9 | Closing Costs | 1,445,008 | 1.3 | |
Other Sources(5) | 229,251 | 0.2 | Other Uses(5) | 229,251 | 0.2 | |
Upfront Reserves | 228,726 | 0.2 | ||||
Total Sources | $108,192,985 | 100.0% | Total Uses | $108,192,985 | 100.0% |
(1) | See “Portfolio Summary” table herein. |
(2) | Based on the underwritten rent rolls dated November 3, 2021 and February 6, 2022. |
(3) | For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below. |
(4) | Historical cash flows are unavailable because the Dealertrack and Divvy Properties were recently acquired. |
(5) | Other Sources and Other Uses relate to a $229,251 parking construction escrow held by the title company and reserved for adjacent parking included in the acquisition but not part of the DealerTrack and Divvy Properties (as defined below). |
The Loan. The Dealertrack and Divvy loan (the “Dealertrack and Divvy Loan”) is secured by a first mortgage lien on the borrower’s fee simple interests in two office properties located in Draper, Utah (collectively, the “Dealertrack and Divvy Properties”). The Dealertrack and Divvy Loan accrues interest at an interest rate of 4.39000% per annum, had an original term of 60 months, has a remaining term of 59 months as of the Cut-off Date and is interest only for the entire term.
The Borrower. The borrowing entity for the Dealertrack and Divvy Loan is AREPIII DD Office Owner, LLC, a Delaware limited liability company (the “Dealertrack and Divvy Borrower”).
The Loan Sponsor. The loan sponsor and non-recourse carveout guarantor is Arden Real Estate Partners III, L.P.
The Properties. The Dealertrack and Divvy Properties consist of two Class A office properties located in Draper, Utah, totaling 318,832 square feet of net rentable area. The Dealertrack property (the “Dealertrack Property”) is a 163,725 square foot, six-story multi-tenant office building that was built in 2018 and is situated on an 8.57-acre parcel. As of November 3, 2021, the Dealertrack Property was 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.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Dealertrack and Divvy |
occupied by four tenants. The Divvy property (the “Divvy Property”) is a 155,107 square foot, six-story single-tenant office building that was built in 2020 and is situated on a 7.83-acre parcel. As of February 6, 2022, the Divvy Property was 100.0% occupied by one tenant.
Portfolio Summary | ||||||
Property | Year Built / Renovated | Net Rentable Area (SF) | Occupancy %(1) | Allocated Loan Amount | Appraised Value | UW NOI % |
Dealertrack | 2018 / NAP | 163,725 | 100.0% | $37,760,274 | $55,500,000 | 52.6% |
Divvy | 2020 / NAP | 155,107 | 100.0% | 36,739,726 | 54,000,000 | 47.4% |
Total / Wtd. Avg. | 318,832 | 100.0% | $74,500,000 | $109,500,000 | 100.0% |
(1) | Based on the underwritten rent rolls dated November 3, 2021 and February 6, 2022. |
The largest tenant at the Dealertrack and Divvy Properties is DivvyPay, Inc., (155,107 SF; 48.6% of NRA; 52.2% of UW Base Rent). Founded in 2016, DivvyPay, Inc. is a privately-owned company, which provides a secure financial platform for businesses to manage payments and subscriptions, build budgets, and eliminate expense reports. DivvyPay, Inc.’s fully-automated spending and expense management software is designed for small and medium size business and DivvyPay, Inc. utilizes the premises as its headquarters. DivvyPay, Inc. subleases the entire sixth floor to McGee Operations LLC.
The second largest tenant by underwritten base rent at the Dealertrack and Divvy Properties is Dealertrack, Inc. (Moody’s: Baa2; S&P: BBB; Fitch: BBB+) (112,900 SF; 35.4% of NRA; 31.2% of UW Base Rent). Dealertrack, Inc. is a provider of integrated automotive dealership software and systems. Dealertrack, Inc. offers an integrated suite of software to automotive dealerships and their lending partners designed to increase efficiency and decision making.
The third largest tenant by underwritten base rent at the Dealertrack and Divvy Properties is NAV Technologies (27,936 SF; 8.8% of NRA; 8.9% of UW Base Rent). Founded in 2012, NAV Technologies is a financial tech company with a platform that provides small and medium size business owners a path to financing. NAV Technologies provides free access to personal and business credit reports from major consumer and commercial credit bureaus.
COVID-19 Update. As of January 6, 2022, the Dealertrack and Divvy Properties are open and operating. As of February 6, 2022, there have been no loan modification or forbearance requests on the Dealertrack and Divvy Loan. The first payment date of the Dealertrack and Divvy Loan is the monthly due date in February 2022. See “Risk Factors—Special Risks—The Coronavirus Pandemic Has Adversely Affected the Global Economy and Will Likely Adversely Affect the Performance of the Mortgage Loans” in the Preliminary Prospectus.
Historical and Current Occupancy | |||
2018(1) | 2019(1) | 2020(1) | Current(2) |
NAV | NAV | NAV | 100.0% |
(1) | Historical information is not available as the Dealertrack and Divvy Properties were recently acquired. |
(2) | Current Occupancy is based on rent rolls dated November 3, 2021 and February 6, 2022. |
The Market. The Dealertrack and Divvy Properties are located in the southern portion of Salt Lake County, within the Southeast Valley submarket. According to the appraisal, as of the trailing four quarters ending third quarter of 2021, the Southeast Valley submarket had a total office inventory of 6,407,000 square feet with a vacancy rate of 15.6% and an average asking rent of $22.37 per square foot. According to the appraisal, as of 2021, the population within a one-, three- and five-mile radius of the Dealertrack and Divvy Properties was 9,364, 72,380 and 178,499, respectively. Additionally, over the same time period, the average household income within a one-, three- and five-mile radius was $119,693, $138,525 and $133,592, respectively.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Dealertrack and Divvy |
Tenant Summary(1) | ||||||
Tenant | Ratings Moody’s/S&P/Fitch | Net Rentable Area (SF) | % of Total NRA | UW Base Rent PSF | % of Total UW Base Rent | Lease Expiration Date |
DivvyPay, Inc.(2) | NR / NR / NR | 155,107 | 48.6% | $30.47 | 52.2% | 5/31/2031 |
Dealertrack, Inc.(3) | Baa2 / BBB / BBB+ | 112,900 | 35.4 | $24.97 | 31.2 | 12/31/2029 |
NAV Technologies | NR / NR / NR | 27,936 | 8.8 | $28.89 | 8.9 | 10/31/2030 |
Summit Sotheby's | NR / NR / NR | 12,500 | 3.9 | $29.80 | 4.1 | 9/30/2029 |
Gold Standard Automotive | NR / NR / NR | 10,389 | 3.3 | $30.95 | 3.6 | 1/31/2024 |
Subtotal / Weighted Average | 318,832 | 100.0% | $28.37 | 100.0% | ||
Remaining Tenants | 0 | 0.0 | 0.00 | 0.0 | ||
Vacant | 0 | 0.0 | ||||
Total / Weighted Average | 318,832 | 100.0% | $28.37 | 100.0% |
(1) | Based on the underwritten rent rolls dated November 3, 2021 and February 6, 2022. |
(2) | DivvyPay, Inc. subleased the entire sixth floor (26,668 square feet) to McGee Operations LLC via a December 14, 2020 sublease for a 60-month term. |
(3) | Dealertrack, Inc. has a contraction option to give back up to 50% of its space effective in October 2024 and April 2027 with 12 months of notice. |
Lease Rollover Schedule(1)(2)(3) | |||||||||
Year | Number of Leases Expiring | Net Rentable Area Expiring | % of NRA Expiring | Base Rent Expiring | % of Base Rent Expiring | Cumulative Net Rentable Area Expiring | Cumulative % of NRA Expiring | Cumulative Base Rent Expiring | Cumulative % of Base Rent Expiring |
Vacant | NAP | 0 | 0.0% | NAP | NAP | 0 | 0.0% | NAP | NAP |
MTM | 0 | 0 | 0 | $0 | 0.0% | 0 | 0.0% | $0 | 0.0% |
2022 | 0 | 0 | 0 | 0 | 0.0 | 0 | 0.0% | $0 | 0.0% |
2023 | 0 | 0 | 0 | 0 | 0.0 | 0 | 0.0% | $0 | 0.0% |
2024 | 1 | 10,389 | 3.3 | 321,532 | 3.6 | 10,389 | 3.3% | $321,532 | 3.6% |
2025 | 0 | 0 | 0.0 | 0 | 0.0 | 10,389 | 3.3% | $321,532 | 3.6% |
2026 | 0 | 0 | 0.0 | 0 | 0.0 | 10,389 | 3.3% | $321,532 | 3.6% |
2027 | 0 | 0 | 0.0 | 0 | 0.0 | 10,389 | 3.3% | $321,532 | 3.6% |
2028 | 0 | 0 | 0.0 | 0 | 0.0 | 10,389 | 3.3% | $321,532 | 3.6% |
2029 | 2 | 125,400 | 39.3 | 3,191,232 | 35.3 | 135,789 | 42.6% | $3,512,764 | 38.8% |
2030 | 1 | 27,936 | 8.8 | 807,132 | 8.9 | 163,725 | 51.4% | $4,319,896 | 47.8% |
2031 | 1 | 155,107 | 48.6 | 4,725,819 | 52.2 | 318,832 | 100.0% | $9,045,715 | 100.0% |
2032 & Thereafter | 0 | 0 | 0.0 | 0 | 0.0 | 318,832 | 100.0% | $9,045,715 | 100.0% |
Total | 5 | 318,832 | 100.0% | $9,045,715 | 100.0% |
(1) | Based on the underwritten rent rolls dated November 3, 2021 and February 6, 2022. |
(2) | Certain tenants may have termination options that are exercisable prior to the originally stated expiration date of the subject lease and that are not considered in the Lease Rollover Schedule. |
(3) | Base Rent includes rent steps occurring through December 1, 2022 for the Dealertrack Property, June 1, 2022 for Divvy Property and the average rent over the lease term for investment grade tenants. |
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.
90 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Dealertrack and Divvy |
Underwritten Net Cash Flow(1) | ||||||||||||
TTM 10/31/2021 | Underwritten(2) | Per Square Foot | %(3) | |||||||||
Base Rent | $8,489,427 | $8,594,200 | $26.96 | 86.1 | % | |||||||
Rent Steps(4) | 0 | 451,515 | 1.42 | 4.5 | ||||||||
Gross Potential Rent | $8,489,427 | $9,045,715 | $28.37 | 90.7 | % | |||||||
Total Reimbursements | 1,642,492 | 931,427 | 2.92 | 9.3 | ||||||||
Net Rental Income | $10,131,919 | $9,977,142 | $31.29 | 100.0 | % | |||||||
(Vacancy/Credit Loss) | 0 | (498,857) | (1.56) | (5.0 | ) | |||||||
Other Income | 0 | 0 | 0.00 | 0.0 | ||||||||
Effective Gross Income | $10,131,919 | $9,478,285 | $29.73 | 95.0 | % | |||||||
Real Estate Taxes | 846,758 | 871,337 | 2.73 | 9.2 | ||||||||
Insurance | 61,918 | 93,341 | 0.29 | 1.0 | ||||||||
Management Fee | 303,958 | 284,349 | 0.89 | 3.0 | ||||||||
Other Operating Expenses | 935,055 | 1,224,438 | 3.84 | 12.9 | ||||||||
Total Expenses | $2,147,689 | $2,473,465 | $7.76 | 26.1 | % | |||||||
Net Operating Income | $7,984,230 | $7,004,821 | $21.97 | 73.9 | % | |||||||
TI/LC | 0 | 444,869 | 1.40 | 4.7 | ||||||||
Capital Expenditures | 0 | 63,766 | 0.20 | 0.7 | ||||||||
Net Cash Flow | $7,984,230 | $6,496,185 | $20.37 | 68.5 | % |
(1) | Historical cash flows are unavailable because the Divvy Property was built in 2020. |
(2) | Based on the underwritten rent rolls dated November 3, 2021 and February 6, 2022. |
(3) | % column represents percent of Net Rental Income for all revenue lines and represents percent of Effective Gross Income the remainder of the fields. |
(4) | Rent Steps represent increases occurring through December 1, 2022 for the Dealertrack Property, June 1, 2022 for the Divvy Property and the average rent over the lease term for investment grade tenants. |
Property Management. The Dealertrack and Divvy Properties are managed by The Boyer Company, L.C., a Utah limited liability company.
Escrows and Reserves. At origination of the Dealertrack and Divvy Loan, the Dealertrack and Divvy Borrower deposited approximately $228,726 into a real estate taxes reserve.
Tax Reserve – The Dealertrack and Divvy Borrower is required to deposit into a real estate tax reserve, on a monthly basis, 1/12th of the real estate taxes that lender estimates will be payable during the ensuing 12 months (initially estimated to be approximately $76,242).
Insurance Reserve – The Dealertrack and Divvy Borrower is required to deposit into an insurance reserve, on a monthly basis, an amount equal to 1/12th of the insurance premiums that would be sufficient for the renewal of coverage unless the Dealertrack and Divvy Borrower maintains an acceptable blanket policy in accordance with the Dealertrack and Divvy Loan documents. As of the origination date, an acceptable blanket policy was in place.
Replacement Reserve– The Dealertrack and Divvy Borrower is required to deposit into a replacement reserve, on a monthly basis, an amount equal to approximately $5,314 for replacement reserves.
Lockbox / Cash Management. The Dealertrack and Divvy Loan is structured with a hard lockbox and springing cash management. At origination of the Dealertrack and Divvy Loan, the borrower was required to deliver a tenant direction letter to the existing tenants at the Dealertrack and Divvy Properties, directing them to remit their rent checks directly to the lender-controlled lockbox. The Dealertrack and Divvy Borrower is required to cause all revenue received by borrower or the property manager for the Dealertrack and Divvy Properties to be deposited into such lockbox immediately following receipt. All funds deposited into the lockbox are required to be transferred on each business day to or at the direction of borrower unless a Trigger Period (as defined below) exists. Upon the occurrence and during the continuance of a Trigger Period, all funds in the lockbox account are required to be swept on each business day to a cash management account under the control of the lender to be applied and disbursed in accordance with the Dealertrack and Divvy Loan documents, and all excess cash flow funds remaining in the cash management account after the application of such funds in accordance with the Dealertrack and Divvy Loan documents are required to be held by the lender in an excess cash flow reserve account as additional collateral for the Dealertrack and Divvy Loan. Upon the cure of the applicable Trigger Period, so long as no other Trigger Period exists, the lender is required to return any amounts remaining on deposit in the excess cash flow reserve account to the borrower. Upon an event of default under the Dealertrack and Divvy Loan documents, the lender will apply funds to the debt in such priority as it may determine.
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.
91 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Dealertrack and Divvy |
A “Trigger Period” means a period (A) commencing upon the earliest of (i) the occurrence and continuance of an event of default, (ii) the debt service coverage ratio falling below 1.50x (a “DSCR Trigger”) (provided, however, no DSCR Trigger will be deemed to exist during any period that the Collateral Cure Conditions (as defined below) are satisfied), and (iii) the occurrence of a Specified Tenant Trigger Period (as defined below); and (B) expiring upon (x) with regard to any Trigger Period commenced in connection with clause (i) above, the cure (if applicable) of such event of default, (y) with regard to any Trigger Period commenced in connection with clause (ii) above, the date that the debt service coverage ratio is equal to or greater than 1.50x for two consecutive calendar quarters and (z) with regard to any Trigger Period commenced in connection with clause (iii) above, a Specified Tenant Trigger Period ceasing to exist in accordance with the terms of the Dealertrack and Divvy Loan documents. Notwithstanding the foregoing, a Trigger Period will not be deemed to expire in the event that a Trigger Period then exists for any other reason.
“Collateral Cure Conditions” means Dealertrack and Divvy Borrower deposits cash into an account with lender or delivers to lender a letter of credit which, in either case, serves as additional collateral for the Dealertrack and Divvy Borrower Loan, equal to the amount which would cause the debt service coverage ratio to equal or exceed 1.50x. The collateral will be returned to Dealertrack and Divvy Borrower, provided no event of default is ongoing, at such time as the debt service coverage ratio (without taking into account the cash deposit and/or letter of credit) will equal or be greater than 1.50x for two consecutive calendar quarters.
A “Specified Tenant Trigger Period” means a period (A) commencing upon the first to occur (i) any Specified Tenant (as defined below) being in monetary or material non-monetary default under the applicable Specified Tenant lease (ii) any Specified Tenant (x) failing to be in actual, physical possession of the Specified Tenant space (or applicable portion thereof), and/or (y) other than in connection with a Permitted Go Dark Event, failing to be open to the public for business during customary hours and/or “going dark” in 50% or more of the Specified Tenant space, (iii) any Specified Tenant giving notice that it is terminating its lease for all or any portion of the Specified Tenant space (or applicable portion thereof), however this notice shall only be given 24 months prior to the date on which the Specified Tenant intends the applicable termination date, (iv) any termination or cancellation of any Specified Tenant lease (including, without limitation, rejection in any bankruptcy or similar insolvency proceeding) and/or any Specified Tenant lease failing to otherwise be in full force and effect, (v) any bankruptcy or similar insolvency of any Specified Tenant, (vi) any Specified Tenant failing to extend or renew its lease on or prior to the earlier of 12 months prior to the expiration of the then applicable term of such lease or the date set forth in such lease for which the applicable Specified Tenant is required to give its renewal notice; and (B) expiring upon the first to occur of lender’s receipt of reasonably satisfactory evidence of (1) satisfaction of the Specified Tenant Cure Conditions (as defined below) or (2) Dealertrack and Divvy Borrower leasing the Specified Tenant space (or portion thereof), the applicable tenant under such lease being in actual, physical occupancy of, and open to the public for business in, the space demised under its lease and paying the full amount of the rent due thereunder.
A “Specified Tenant” means, as applicable, (i) Dealertrack, Inc., a Delaware corporation, (ii) DivvyPay, LLC, a Delaware limited liability company, (iii) any other lessee(s) that lease (in the aggregate) at least 28,000 rentable square feet of the Specified Tenant space and (iv) any guarantor(s) of the applicable related Specified Tenant lease(s).
The “Specified Tenant Cure Conditions” means each of the following, as applicable: (i) the applicable Specified Tenant has cured all defaults under its lease, (ii) the applicable Specified Tenant is in actual, physical possession of the applicable Specified Tenant space (or applicable portion thereof), open to the public for business during customary hours and not “dark” in the applicable Specified Tenant space (or applicable portion thereof) or the Sublease Conditions (as defined below) are satisfied, (iii) the applicable Specified Tenant has revoked or rescinded all termination or cancellation notices with respect to the applicable Specified Tenant Lease and has re-affirmed the applicable Specified Tenant Lease as being in full force and effect, (iv) in the event the Specified Tenant Trigger Period is due to the applicable Specified Tenant’s failure to extend or renew the applicable Specified Tenant Lease in accordance with clause (v) of the definition of “Specified Tenant Trigger Period”, the applicable Specified Tenant has renewed or extended the applicable Specified Tenant Lease in accordance with the terms hereof and thereof for at least a five year term, (vi) with respect to any applicable bankruptcy or insolvency proceedings involving the applicable Specified Tenant, the applicable Specified Tenant is no longer insolvent or subject to any bankruptcy or insolvency proceedings and has affirmed its lease pursuant to final, non-appealable order of a court of competent jurisdiction, and (vii) the applicable Specified Tenant is paying full, unabated rent under its lease.
“Sublease Conditions” means that: (i) 75% or more of the applicable Specified Tenant space is demised to one or more subtenants pursuant to one or more subleases entered into in accordance with the Dealertrack and Divvy Loan, (ii) each such subtenant is open for business in the entirety of such space, (iii) each such sublease is co-terminus with the applicable Specified Tenant lease, (iv) each such sublease provides economic terms as favorable or better than the Specified Tenant Lease, (v) each such subtenant is paying full unabated rent pursuant, is not in default, and is not subject to a bankruptcy or insolvency proceeding, (vi) no such subtenant has sent any written notice indicating an intent to “go dark” and/or terminate its sublease and (vii) each such subtenant is of an equal or higher credit quality as the tenant pursuant to the applicable Specified Tenant lease.
Current Mezzanine or Subordinate Indebtedness. None.
Future Mezzanine or Subordinate Indebtedness Permitted. None.
Partial Release. None.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
92 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
The Summit |
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.
93 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
The Summit |
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.
94 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
The Summit |
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.
95 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
The Summit |
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.
96 of 106
Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
The Summit |
Mortgage Loan Information | Property Information | |||
Mortgage Loan Seller: | GSMC | Single Asset / Portfolio: | Single Asset | |
Original Principal Balance(1): | $65,000,000 | Title: | Fee | |
Cut-off Date Principal Balance(1): | $65,000,000 | Property Type - Subtype: | Office – CBD | |
% of Pool by IPB: | 3.7% | Net Rentable Area (SF): | 907,306 | |
Loan Purpose: | Refinance | Location: | Bellevue, WA | |
Borrowers: | KRE Summit 1, 2, Owner LLC and | Year Built / Renovated: | 2002, 2005, 2021 / NAP | |
KRE Summit 3 Owner LLC | Occupancy: | 98.2% | ||
Guarantors: | KKR Property Partners Americas | Occupancy Date: | 1/1/2022 | |
(EEA) SCSp and KKR Property | Number of Tenants: | 13 | ||
Partners Americas L.P. | Fourth Most Recent NOI: | NAV | ||
Interest Rate: | 2.95200% | Third Most Recent NOI: | $17,630,561 (December 31, 2018) | |
Note Date: | 12/10/2021 | Second Most Recent NOI: | $16,395,672 (December 31, 2019) | |
Maturity Date: | 2/6/2029 | Most Recent NOI(3): | $20,849,893 (December 31, 2020) | |
Interest-only Period: | 86 months | UW Economic Occupancy: | 96.3% | |
Original Term: | 86 months | UW Revenues: | $57,071,586 | |
Original Amortization: | None | UW Expenses: | $15,970,440 | |
Amortization Type: | Interest Only | UW NOI(3): | $41,101,145 | |
Call Protection(2): | L(24),YM1(2),DorYM1(53),O(7) | UW NCF: | $40,230,920 | |
Lockbox / Cash Management: | Hard / Springing | Appraised Value / Per SF: | $895,500,000 / $987 | |
Additional Debt(1): | Yes | Appraisal Date: | 11/1/2021 | |
Additional Debt Balance(1): | $262,000,000 / $198,000,000 | |||
Additional Debt Type(1): | Pari Passu / Subordinate | |||
Escrows and Reserves(4) | Financial Information | ||||||||||||
Initial | Monthly | Initial Cap | Senior Notes | Whole Loan | |||||||||
Taxes: | $0 | Springing | N/A | Cut-off Date Loan / SF: | $360 | $579 | |||||||
Insurance: | $0 | Springing | N/A | Maturity Date Loan / SF: | $360 | $579 | |||||||
Replacement Reserves: | $0 | Springing | N/A | Cut-off Date LTV: | 36.5% | 58.6% | |||||||
TI/LC: | $0 | $0 | N/A | Maturity Date LTV: | 36.5% | 58.6% | |||||||
Other(5): | $9,900,543 | Springing | N/A | UW NCF DSCR: | 4.11x | 2.56x | |||||||
UW NOI Debt Yield: | 12.6% | 7.8% | |||||||||||
| |||||||||||||
Sources and Uses | |||||||||||||
Sources | Proceeds | % of Total | Uses | Proceeds | % of Total | ||||||||
Loan Amount | $327,000,000 | 62.3% | Loan Payoff | $382,728,320 | 72.9% | ||||||||
Subordinate Debt | 198,000,000 | 37.7 | Return of Equity | 129,305,151 | 24.6 | ||||||||
Reserves | 9,900,543 | 1.9 | |||||||||||
Closing Costs | 3,065,986 | 0.6 | |||||||||||
Total Sources | $525,000,000 | 100.0% | Total Uses | $525,000,000 | 100.0% | ||||||||
(1) | The Summit Whole Loan (as defined below) is part of a whole loan evidenced by (i) eight pari passu notes, with an aggregate outstanding principal balance as of the Cut-off Date of $327.0 million and (ii) two pari passu subordinate notes with an aggregate outstanding principal balance as of the Cut-off Date of $198.0 million. The Financial Information in the chart above reflects the Cut-off Date Balance of The Summit Whole Loan. |
(2) | The defeasance lockout period, with respect to a defeasance of The Summit Whole Loan, will be at least 26 payment dates beginning with and including the first payment date on January 6, 2022. Defeasance of the full $525.0 million The Summit Whole Loan is permitted after the date that is earlier of (i) two years from the closing date of the securitization that includes the last note to be securitized and (ii) December 10, 2024. In addition, The Summit Whole Loan may be voluntarily prepaid in whole (but not in part, except to the extent permitted to cure certain trigger events described in The Summit Whole Loan documents) on the payment date in January 2024, and at any time thereafter, subject to payment of a prepayment fee equal to the greater of (a) the yield maintenance amount and (b) 1% of the principal balance that is being prepaid as of the prepayment date if such prepayment occurs prior to the payment date in August 2028. |
(3) | The increase from the Most Recent NOI to Underwritten Net Operating Income is primarily attributable to the inclusion of the Amazon (as defined below) lease ($13,232,419 Underwritten Base Rent), as well as an increase in parking garage income per the Sponsor Budget ($2,979,702) and the straight-line rent for investment grade tenants ($1,614,740). |
(4) | For a full description of Escrows and Reserves, please refer to “Escrows and Reserves” below. |
(5) | Other initial reserves include (i) $2,958,400 into a reserve for free rent and outstanding or abated rent and/or any bridge/gap rent and (ii) $6,942,143 for outstanding tenant improvement allowances and leasing commissions. |
The Loan. The Summit mortgage loan (“The Summit Loan” or “The Summit Trust Senior Note”) is part of a whole loan with an aggregate outstanding principal balance as of the Cut-off Date of $525.0 million (the “The Summit Whole Loan”) consisting of (i) eight senior pari passu notes with an aggregate outstanding principal balance as of the Cut-off Date of $327.0 million (“The Summit Senior Notes”) and
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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(ii) two pari passu subordinate notes with an aggregate outstanding principal balance as of the Cut-off Date of $198.0 million (“The Summit Subordinate Loan”). The Summit Whole Loan is secured by the borrowers’ fee interest in a 907,306 square foot Class A, office campus which includes three buildings and a seven-level 2,197 space subterranean parking garage located in the central business district of Bellevue, Washington (the “The Summit Property”). The non-controlling Note A-2-1, with an outstanding principal balance as of the Cut-off Date of $65.0 million, will be included in the mortgage pool for the Benchmark 2022-B32 mortgage trust. The remaining seven senior pari passu notes (the “The Summit Non-Trust Senior Notes”) have an aggregate outstanding principal balance as of the Cut-off Date of $262.0 million and have been, or are expected to be, contributed to one or more future securitization trusts or may otherwise be transferred at any time.
The Summit Whole Loan, which accrues interest at an interest rate of 2.95200% per annum, was co-originated by Barclays Real Estate Capital Inc. and Goldman Sachs Bank USA on December 10, 2021, had an aggregate original principal balance of $525.0 million and has an aggregate outstanding principal balance as of the Cut-off Date of $525.0 million. The proceeds of The Summit Whole Loan were primarily used to refinance The Summit Property, pay origination costs, return equity to the loan sponsor and fund upfront reserves. The Summit Whole Loan was previously securitized in SUMIT 2022-BVUE. The relationship between the holders of The Summit Whole Loan is governed by a co-lender agreement as described under “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced AB Whole Loans” in the Preliminary Prospectus. The Summit Whole Loan had an initial term of 86 months and has a remaining term of 84 months as of the Cut-off Date. The Summit Whole Loan requires monthly payments of interest only for the entire duration of the loan. The scheduled maturity date of The Summit Whole Loan is the due date in February 2029. Voluntary prepayment of The Summit Whole Loan in whole (but not in part) is permitted after the open prepayment date occurring in August 2028 without payment of any prepayment premium. Defeasance of the full $525.0 million The Summit Whole Loan is permitted after the date that is earlier of (i) two years from the closing date of the securitization that includes the last note to be securitized and (ii) December 10, 2024.
The table below summarizes the promissory notes that comprise the Summit Whole Loan. The relationship between the holders of the Summit Whole Loan will be governed by a co-lender agreement as described under “Description of the Mortgage Pool—The Whole Loans—The Non-Serviced AB Whole Loans” in the Preliminary Prospectus.
Whole Loan Summary | ||||||
Note | Original Balance | Cut-off Date Balance | Note Holder | Controlling Piece | ||
A-1-S | $64,200,000 | $64,200,000 | SUMIT 2022-BVUE | Yes | ||
A-2-S | $42,800,000 | $42,800,000 | SUMIT 2022-BVUE | No | ||
A-1-1 | $50,000,000 | $50,000,000 | BCREI(1) | No | ||
A-1-2 | $50,000,000 | $50,000,000 | BCREI(1) | No | ||
A-1-3 | $25,000,000 | $25,000,000 | BCREI(1) | No | ||
A-1-4 | $7,000,000 | $7,000,000 | BCREI(1) | No | ||
A-2-1 | $65,000,000 | $65,000,000 | BMARK 2022-B32 | No | ||
A-2-2 | $23,000,000 | $23,000,000 | GSBI(1) | No | ||
Total Senior Notes | $327,000,000 | $327,000,000 | ||||
B-1-1 | $118,800,000 | $118,800,000 | SUMIT 2022-BVUE | No | ||
B-2-1 | $79,200,000 | $79,200,000 | SUMIT 2022-BVUE | No | ||
Whole Loan | $525,000,000 | $525,000,000 | ||||
(1) | Expected to be contributed to one or more future securitization trusts. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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The Summit Whole Loan capital structure is shown below:
(1) | Based on the “as-is” appraised value of $895,500,000 as of November 1, 2021. |
(2) | Based on the UW NOI of $41,101,145 and the UW NCF of $40,230,920. |
(3) | Based on the appraised value of $895,500,000, the Implied Borrower Sponsor Equity is $370,500,000. |
The Borrowers. The borrowers are KRE Summit 1, 2, Owner LLC and KRE Summit 3 Owner LLC, each a Delaware limited liability company. The borrowers are structured to be single purpose bankruptcy-remote entities, having at least two independent directors in their organizational structure. Legal counsel to the borrowers delivered a non-consolidation opinion in connection with the origination of The Summit Whole Loan.
The Loan Sponsors. The loan sponsors and non-recourse guarantors are KKR Property Partners Americas (EEA) SCSp and KKR Property Partners Americas L.P. (collectively, the “KKR Guarantor”).
The Property. The Summit Property is a Class A office campus consisting of three buildings: Summit 1 (242,180 SF, 26.7% of NRA) and Summit 2 (290,906 SF, 32.1% of NRA), which were constructed in 2005 and 2002, respectively and are LEED Platinum certified, and Summit 3 (374,220 SF, 41.2% of NRA), which was constructed in 2021 and is LEED Gold certified. The Summit Property also includes a seven-level, 2,197 space subterranean Parking Garage. Per a third-party market research report, vacancy in the Bellevue CBD for properties of similar quality is approximately 4.5%. Located within a block of I-405, the Bellevue Transit Center and the Downtown Bellevue station of the planned East Link Light Rail, The Summit Property offers access to employees commuting via public transportation as well as car commuters, which can utilize The Summit Property’s 2,197 subterranean Parking Garage.
All but 0.6% of UW Base Rent is attributable to space leased or subleased by investment grade tenants or tenants on the Am Law 50. The majority of space is directly leased to investment grade tenants such as Amazon.com Services, Inc. (41.2% of NRA), Puget Sound Energy, Inc. (24.7% of NRA) and First Republic Bank (8.1% of NRA). Amazon also subleases 133,059 SF of space from WeWork (the entirety of WeWork’s presence at The Summit Property) through an enterprise lease, bringing its total footprint at The Summit Property to 507,279 SF (55.9% of NRA). The WeWork space was built to Amazon’s specs and the Amazon lease commenced at the same time as the WeWork lease. Perkins Coie LLP, ranked 42 on the Am Law 50, has been at The Summit Property since 2003 and leases 26,070 SF (2.9% of NRA) at The Summit Property. The Summit Property has a weighted average lease term (“WALT”) of 10.7 years and the majority of investment grade tenants have leases that run beyond the approximately seven-year loan term including Amazon (14.6 year WALT), First Republic Bank (10.1 year WALT) and New York Life Insurance Co. (7.9 year WALT).
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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Major Tenants.
The largest tenant, Amazon.com Services, Inc. (“Amazon”) (374,220 square feet; 41.2% of net rentable area; 39.6% of underwritten base rent), is a multinational technology conglomerate that recently surpassed Walmart as the world’s largest retailer outside of China. Amazon also operates in a diverse range of business segments including devices and services (Alexa, Fire TV, Fire Tablets etc.), Amazon Web Services, Delivery and Logistics and Entertainment and is the fifth largest company in the world by market capitalization. In 2021, Amazon surpassed Boeing to become Washington’s largest employer and plans to bring an estimated 25,000 jobs to Bellevue as part of the expansion of its Puget Sound headquarters. Amazon occupies the entirety of Summit 3 on a 15-year lease that commenced in September 2021 with one option to terminate any portion of its lease after September 30, 2033 (almost five years beyond the loan term) with 18 months’ notice and the payment of three-months’ rent and all unamortized TI/LC costs. Amazon has a right of first offer on any available space in Summit 1 or Summit 2. Amazon.com, Inc. provides a limited parent guarantee, with a maximum liability of approximately $44.2 million (approximately 3.4 years of UW Base Rent) for the first 151 months of the lease, which then burns off throughout the remainder of lease term.
The second largest tenant, Puget Sound Energy, Inc. (223,820 square feet; 24.7% of net rentable area; 24.4% of underwritten base rent), or its predecessors have been providing energy to Washington since 1873 and is now the largest energy utility in the state, providing electric power to 1.2 million customers and natural gas to 900,000 customers over 6,000 square miles primarily in the Puget Sound region of western Washington. Puget Sound Energy, Inc. utilizes The Summit Property as its corporate headquarters. Puget Sound Energy, Inc. is an office tenant of Summit 1 on a lease that expires October 31, 2028. Puget Sound Energy, Inc. has no termination options but the borrowers may, subject to no continuing event of default and debt yield tests, amend the Puget Sound Energy, Inc. lease to reduce the premises by up to 223,820 SF and re-lease that space provided the replacement lease (i) is not to an affiliate of the borrowers, (ii) the term of the lease is at least as long as the remaining term of the Puget Sound Energy, Inc. lease, (iii) is to a tenant that is rated BBB- or better by two agencies or is one of the following: Snowflake, Smartsheet Inc., Splunk Technology, Niantic, Inc., Snap Inc., DocuSign, Inc. or Discovery, Inc. The borrowers are also responsible for all leasing costs and must reserve all free and gap rent between the termination date and the rent commencement date of the replacement lease. Puget Sound Energy Inc. has two five-year extension options with 12-months’ notice at 95% of market rent.
The third largest tenant, WeWork (133,059 square feet; 14.7% of net rentable square feet; 15.6% of underwritten base rent), WeWork is a global flexible workspace provider with over 700 locations globally in 150 cities across 38 countries providing workplace solutions to members ranging from freelancers to Fortune 500 companies. WeWork was taken public in October 2021 through a $9 billion SPAC merger with BowX Acquisition. WeWork leases 133,059 SF at Summit 2 on a lease that expires March 31, 2032 with no extension options. The entirety of WeWork’s 133,059 SF footprint at The Summit Property, including floors 8-12 and suite 650 at Summit 2, is subleased to Amazon through an enterprise lease. Amazon has been the sole subtenant at the WeWork space. The terms of the sublease between WeWork and Amazon are not known to the Lender. WeWork has one, 5-year option to extend the term of the sublease upon written notice to the landlord not later than 12 months prior to the expiration date of the initial term.
The Market. The Summit Property is located in the in the Seattle-Bellevue-Everett metropolitan statistical area (“MSA”), which according to the appraisal is home to one of the most highly advanced and diversified economies in the country and the third highest share of information workers in the country, behind only Silicon Valley and San Francisco. In addition to tech companies like Amazon and Microsoft Corp., Boeing remains one of the largest private employers in the region with manufacturing jobs in large facilities through the Puget Sound region. The Summit Property is located in the Bellevue central business district office submarket of the Seattle office market, as defined by a third-party market research report.
Over the past three years, Seattle saw the largest growth in occupancy among large U.S. cities largely due to demand from tech tenants, which are attracted to its relative affordability compared to peer markets like San Francisco and the high concentration of talent in the area. The Seattle office market has added over 13.0 mm SF of space since 2018 but robust pre-leasing from tech companies like Amazon, Facebook and Google kept vacancy low and absorption positive prior to the pandemic. According to a third-party market research report, the Eastside office market saw absorption of 702,000 SF in the third quarter of 2021 which outpaced absorption for the entire calendar year of 2019 by 305,000 SF, driven by leases to Snowflake Computing, Robinhood and others. Current vacancy in the Seattle office market is 9.6%, higher than in recent years but remains below its ten year high of 10.6% and the U.S. index of 12.2%. Rents in the Seattle office market have increased YTD to $38.28 per square foot, less than $1.00 per square foot off the pre-pandemic peak of $39.11 per square foot in 2019 and higher than the previous high of $36.53 per square foot in 2018.
The Bellevue central business district offers the largest live/work/shop/play environment in Bellevue and lies in proximity to some of the region’s residential neighborhoods making it one of the office hubs in the area for tech tenants and companies expanding outside of Seattle. Bellevue has seen a surge in technology company expansions over the past two years, highlighted by industry leaders such as Facebook, Google, Salesforce, T-Mobile, Microsoft and Amazon. Since 2017, Amazon has committed to more than six million square feet of office space in the Bellevue central business district and has pledged to bring 25,000 jobs to the market in the coming years. As a result of high quality inventory and strong demand from tech employers as a result of its proximity and accessibility, the Bellevue central business district office market commands the highest rents in the Seattle area. Bellevue is a more convenient commute than Seattle for many area residents working in tech industries, and the planned light rail station expected to open in 2023 will improve connectivity making it even more accessible. Despite robust leasing activity over the past year, the vacancy in the Bellevue central business district office market has
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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increased to 7.4% from its pre-pandemic low of 3.6% but remains well below its ten year high of 16.3% and is below both the overall Seattle office market (9.6%) and the U.S. Index (12.2%).
Historical and Current Occupancy | |||
2018(1) | 2019(1) | 2020(1) | Current(2) |
NAV | NAV | NAV | 98.2% |
(1) | Historical Occupancies are as of December 31 of each respective year. |
(2) | Current Occupancy is as of January 1, 2022. |
COVID-19 Update. As of January 7, 2022, The Summit Property is open and operating. Rent collections for The Summit Property were 99.8% and 99.8% for November and December 2021, respectively. There has been no rent relief requested, except for ongoing negotiations with a retail tenant, Café Pogacha, who is currently engaging in lease extension discussions in exchange for restructured rent. As of January 7, 2022, no loan modification or forbearance requests have been made on The Summit Whole Loan. The first payment date of The Summit Loan was January 6, 2022.
Tenant Summary(1) | |||||||
Tenant | Ratings Moody’s/Fitch/S&P(2) | Net Rentable Area (SF) | % of Total NRA | Base Rent PSF(3) | % of Total Base Rent(3) | Lease Expiration Date | |
Amazon.com Services, Inc. | A1/AA-/AA | 374,220 | 41.2% | $35.36 | 39.6% | 8/31/2036(4) | |
Puget Sound Energy, Inc. | A2/A/BBB | 223,820 | 24.7 | $36.50 | 24.4 | 10/31/2028 | |
WeWork(5) | NR/NR/NR | 133,059 | 14.7 | $39.30 | 15.6 | 3/31/2032 | |
First Republic Bank(6) | Baa1/A-/A- | 73,910 | 8.1 | $46.51 | 10.3 | 1/31/2032 | |
Perkins Coie LLP | NR/NR/NR | 26,070 | 2.9 | $53.00 | 4.1 | 12/31/2026 | |
New York Life Insurance Co. | Aaa/AA+/AA+ | 21,875 | 2.4 | $53.00 | 3.5 | 11/30/2029 | |
AvalonBay Communities, Inc. | A3/NR/A- | 7,003 | 0.8 | $46.23 | 1.0 | 9/30/2030 | |
Delta Air Lines Inc. | Baa3/BB+/BB | 7,354 | 0.8 | $43.00 | 0.9 | 12/31/2024 | |
Bright Horizons | B1/NR/B+ | 11,500 | 1.3 | $11.15 | 0.4 | 10/31/2028 | |
Cafe Pogacha | NR/NR/NR | 2,125 | 0.2 | $29.26 | 0.2 | 6/30/2023 | |
Total | 880,936 | 97.1% | $37.96 | 100.0% | |||
Remaining Tenants(7) | 9,791 | 1.1% | $0.00 | 0.00% | |||
Total Occupied | 890,727 | 98.2% | |||||
Vacant | 16,579 | 1.8% | |||||
Total | 907,306 | 100.0% | $37.54 | 100.0% |
(1) | As of the January 1, 2022 rent roll which includes multiple rights of first offer exercised by First Republic Bank on spaces for which the leases have not yet commenced. All outstanding free and gap rent was reserved by the borrowers at origination. |
(2) | In certain instances, ratings provided are those of the parent company of the entity shown, whether or not the parent company guarantees the lease. |
(3) | Base Rent PSF includes $735,068 of rent steps through December 31, 2022 and excludes $1,614,740 of straight-line rent for investment grade tenants. |
(4) | Amazon has the right to terminate any portion of its lease after September 30, 2033 with 18 months’ notice and the payment of three-months’ rent and all unamortized tenant improvements and leasing commissions. |
(5) | WeWork is 100% enterprise subleased to Amazon. Amazon has been the sole subtenant at the WeWork space and the space was built to Amazon’s specifications. |
(6) | First Republic Bank is currently in occupancy at 20,680 SF of space in Summit 2 and has exercised several rights of first offer which will bring its total footprint at The Summit Property to 73,910 SF with all leases expiring January 31, 2032. All free rent and gap rent has been reserved by the borrowers. |
(7) | Includes Conference Room and Property Management Office for which no base rent was underwritten. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Lease Rollover Schedule(1)(2)(3) | |||||||||
Year | Number of Tenant Leases Expiring | Net Rentable Area Expiring | % of NRA Expiring | Base Rent Expiring(4) | % of Base Rent Expiring | Cumulative Net Rentable Area Expiring | Cumulative % of NRA Expiring | Cumulative Base Rent Expiring | Cumulative % of Base Rent Expiring |
Vacant | NAP | 16,579 | 1.8% | NAP | NAP | 16,579 | 1.8% | NAP | NAP |
MTM | 0 | 0 | 0.0% | $0 | 0.0% | 16,579 | 1.8% | $0 | 0.0% |
2022 | 0 | 0 | 0.0% | $0 | 0.0% | 16,579 | 1.8% | $0 | 0.0% |
2023 | 1 | 2,125 | 0.2% | $62,178 | 0.2% | 18,704 | 2.1% | $62,178 | 0.2% |
2024 | 1 | 7,354 | 0.8% | $316,222 | 0.9% | 26,058 | 2.9% | $378,400 | 1.1% |
2025 | 0 | 0 | 0.0% | $0 | 0.0% | 26,058 | 2.9% | $378,400 | 1.1% |
2026 | 1 | 26,070 | 2.9% | $1,381,710 | 4.1% | 52,128 | 5.7% | $1,760,110 | 5.3% |
2027 | 0 | 0 | 0.0% | $0 | 0.0% | 52,128 | 5.7% | $1,760,110 | 5.3% |
2028 | 2 | 235,320 | 25.9% | $8,297,655 | 24.8% | 287,448 | 31.7% | $10,057,765 | 30.1% |
2029 | 1 | 21,875 | 2.4% | $1,159,375 | 3.5% | 309,323 | 34.1% | $11,217,140 | 33.5% |
2030 | 1 | 7,003 | 0.8% | $323,749 | 1.0% | 316,326 | 34.9% | $11,540,888 | 34.5% |
2031 | 0 | 0 | 0.0% | $0 | 0.0% | 316,326 | 34.9% | $11,540,888 | 34.5% |
2032 and Thereafter(5) | 6 | 590,980 | 65.1% | $21,898,307 | 65.5% | 907,306 | 100.0% | $33,439,195 | 100.0% |
Total | 13 | 907,306 | 100.0% | $33,439,195 | 100.0% |
(1) | As of the January 1, 2022 rent roll which includes multiple rights of first offer exercised by First Republic Bank on spaces for which the leases have not yet commenced. All outstanding free and gap rent was reserved by the borrowers at origination. |
(2) | Lease Rollover Schedule is based on the lease expiration dates of all direct leases in place. |
(3) | Certain tenants may have termination or contraction options (which may become exercisable prior to the originally stated expiration date of the tenant lease) that are not considered in the above Lease Rollover Schedule. See “Tenant Summary” above. |
(4) | UW Base Rent includes $735,068 of rent steps through December 31, 2022 and excludes $1,614,740 of straight-line rent for investment grade tenants. |
(5) | Includes Fitness Center, Conference Room, and Property Management Office for which no base rent was underwritten. |
Operating History and Underwritten Net Cash Flow(1)(2) | ||||||||
2018 | 2019 | 2020 | Budget / Year 1 | Underwritten(2) | Per Square Foot | %(3) | ||
Base Rent(2) | 13,492,937 | 12,412,455 | 17,227,962 | 31,792,964 | 32,704,127 | $36.05 | 55.2% | |
Other Income(3) | 5,017,341 | 4,369,357 | 3,908,618 | 6,786,449 | 6,786,449 | $7.48 | 11.5% | |
Expense Recoveries | 6,894,614 | 6,236,499 | 7,633,046 | 16,421,927 | $16,544,308 | $18.23 | 27.9% | |
Gross Potential Revenue | $25,404,892 | $23,018,311 | $28,769,626 | $55,001,340 | $59,263,379 | 65.32 | 100.0% | |
(Vacancy/Credit Loss) | 0 | 0 | 0 | 0 | (2,191,794) | ($2.42) | (3.7%) | |
Effective Gross Income | $25,404,892 | $23,018,311 | $28,769,626 | $55,001,340 | $57,071,586 | $62.90 | 96.3% | |
Total Expenses | 7,774,331 | 6,622,639 | 7,919,733 | 16,245,344 | 15,970,440 | $17.60 | 26.9% | |
Net Operating Income | $17,630,561 | $16,395,672 | $20,849,893 | $38,755,996 | $41,101,145 | $45.30 | 69.4% | |
Total TI/LC, RR | 0 | 0 | 0 | 0 | 870,225 | $0.96 | 1.5% | |
Net Cash Flow | $17,630,561 | $16,395,672 | $20,849,893 | $38,755,996 | $40,230,920 | $44.34 | 67.9% | |
(1) | Historical financials (2018-2020) are based on financials for Summit 1 and 2 only as Summit 3 is recently delivered. The 2018 – 2020 PSF figures are based on the total square footage of Summit 1 and 2 (533,086 SF). |
(2) | The increase from historical financials is due to the inclusion of Summit 3 which was delivered in Q3 2021 and is fully leased to Amazon. |
(3) | % column represents percent of Gross Potential Revenue for all revenue lines and represents percent of Effective Gross Revenue for the remainder of fields. |
Property Management. The Summit Property is managed by Urban Renaissance Property Company LLC.
Escrows and Reserves. At loan origination, the borrowers deposited (i) $2,958,400 into a reserve for free rent and outstanding or abated rent and/or any bridge/gap rent and (ii) $6,942,143 for outstanding tenant improvement allowances and leasing commissions.
Tax Reserve – The borrowers are required to deposit into a real estate tax reserve, on a monthly basis during the continuance of a Summit Cash Sweep Period (as defined below), 1/12th of the reasonably estimated annual real estate taxes.
Insurance Reserve – The borrowers are required to deposit into an insurance reserve, on a monthly basis during the continuance of a Summit Cash Sweep Period, 1/12th of reasonably estimated insurance premiums unless the borrowers maintain a blanket policy in accordance with The Summit Whole Loan documents.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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The Summit |
Replacement Reserves – The borrowers are required to deposit into a replacement reserve during the continuance of a Summit Cash Sweep Period, an amount equal to approximately $113,413.25 ($1.50 per square foot annually) for approved tenant improvements and leasing commissions at The Summit Property in accordance with The Summit Whole Loan documents. Amounts are disbursed from the TI/LC Reserve Account for approved tenant improvements, leasing commissions, speculative tenant improvements, white box space, tenant amenities and the like at The Summit Property in accordance with The Summit Whole Loan documents; provided with respect to spec space, such disbursements will not to exceed $75 per square foot, and the square footage will not exceed 10% of the square footage per building or 15% of the square footage for The Summit Property in the aggregate.
Lease Sweep Reserve – During the continuance of a Summit Lease Sweep Period (as defined below), all excess cash will be deposited into an account for purposes of re-tenanting the Amazon space (or any other space at The Summit Property under a Qualified Replacement Lease), and such approved leasing costs incurred in connection therewith in accordance with The Summit Whole Loan documents. During the continuance of a Summit Lease Sweep Period, so long as no other Summit Cash Sweep Period is then continuing, the borrowers will not be required to deposit into any reserve account (other than the tax and insurance escrow fund or the replacement reserve account) once the aggregate amount on reserve in all reserve accounts in account of any Summit Lease Sweep Lease or Summit Lease Sweep Trigger Event is equal to or greater the Summit Lease Sweep Reserve cap.
Replacement Lease Reserve Account – The borrowers are required to deposit all amounts in the event a lease is terminated in whole or in part (including a termination in respect of Recaptured Puget Sound Space as set forth below), or the tenant thereunder defaults, and in any such case borrowers receive or are permitted to retain any payment, fee, damages, forfeited security deposit, or proceeds of any bond or letter of credit given as security (excluding any such amounts applied by the borrowers to cure any default under such lease other than non-payment of rent that is not yet due and payable) (collectively, “Termination Proceeds”). To the extent the amounts contained in the replacement lease reserve account in respect of any terminated lease space exceed the aggregate remaining amount of leasing commissions, tenant improvement costs, gap rent and free rent under the applicable replacement leases for such terminated lease space, then provided no event of default is continuing, the borrowers will have the right to either (i) apply such excess toward the costs of speculative tenant improvements, white box space, tenant amenities and the like (including, without limitation, base building work in connection therewith), by including such costs in a disbursement request, or (ii) designate such excess to be held by the lender for purposes of calculating Debt Yield, or (iii) designate such excess as Excess Replacement Lease Reserve Funds pursuant to, and for application in accordance with the following: At the borrowers’ election, provided no event of default is continuing, all Excess Replacement Lease Reserve Funds remaining in the Replacement Lease Reserve Account in respect of such terminated lease space will from time to time be remitted to the borrowers (or, during a Summit Cash Sweep Period, to the Cash Management Account for application pursuant to the Cash Management Agreement) following written request from the borrowers (or, at the borrowers’ option, such Excess Replacement Lease Reserve Funds will be held by the lender for purposes of calculating Debt Yield).
Excess Cash Flow Reserve – During the continuance of a Summit Cash Sweep Period, other than a Summit Lease Sweep Period, all excess cash after disbursements for required reserve deposits, debt service, and property-level expenses in accordance with The Summit Loan documents will be deposited into the excess cash flow reserve account and held as additional collateral for The Summit Whole Loan.
“Summit Cash Sweep Event” means the occurrence of: (a) an event of default; (b) a Summit Lease Sweep Trigger Event; or (c) a Summit Debt Yield Trigger Event.
“Summit Cash Sweep Period” means each period commencing on the occurrence of a Summit Cash Sweep Event and continuing until the earlier of (a) the date that the related Summit Cash Sweep Event is cured in accordance with The Summit Whole Loan documents, or (b) until (x) payment in full of all principal and interest on The Summit Whole Loan and all other amounts payable under The Summit Whole Loan documents or (y) defeasance of The Summit Whole Loan.
“Summit Debt Yield Trigger Event” means a Debt Yield of less than 5.50% for the two (2) consecutive calendar quarters immediately preceding any date of determination.
“Summit Debt Yield Trigger Period” means the period commencing on the occurrence of a Summit Debt Yield Trigger Event and continuing until the date that the related Summit Debt Yield Trigger Event is cured in accordance with The Summit Whole Loan documents.
“Excess Replacement Lease Reserve Funds” means, as determined upon request of the borrowers following execution of one or more replacement Leases for any terminated lease space (including the Recaptured Puget Sound Space, as defined below), an amount equal to (1) all sums remaining in the Replacement Lease Reserve Account on account of such terminated lease, minus (2) solely to the extent rents under the replacement lease are not sufficient to replace rents under the terminated lease (it being understood that, if sufficient, no amount will be deducted pursuant this clause (2), the sum of the allocated vacant space leasing costs.
A “Summit Lease Sweep Period” will occur upon the first Payment Date following the occurrence of a Summit Lease Sweep Trigger Event and end upon the date such Summit Lease Sweep Trigger Event is cured in accordance with The Summit Whole Loan documents. A Summit Lease Sweep Period will not be triggered (or if triggered, will be terminated) if the borrowers deposit cash into the Lease Sweep Reserve account or deliver a letter of credit, in an amount that, when aggregated with any Termination Proceeds deposited in the Replacement Lease Reserve account in respect of such Summit Lease Sweep Lease, equal to a cap of $60 per square foot to the lender.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
The Summit |
A “Summit Lease Sweep Trigger Event” means the occurrence of any of the following: (a) a bankruptcy action of a tenant (or guarantor thereof) under a Summit Lease Sweep Lease, (b) any monetary default or material non-monetary default under a Summit Lease Sweep Lease that continues beyond any applicable grace, notice and cure period under such Summit Lease Sweep Lease, (c) a tenant under a Summit Lease Sweep Lease goes dark at 50% or more of its space, except as provided in The Summit loan agreement or (d) the earlier of the date upon which (i) a tenant under a Summit Lease Sweep Lease cancels or terminates its lease with respect to at least 25% of the square of space subject to the Amazon lease as of the loan origination date prior to the then-current expiration date under such lease or (2) such tenant gives written notice to the borrowers that it is cancelling or terminating its Summit Lease Sweep Lease with respect to at least 25% of the square footage of space subject to the Amazon lease as of the loan origination date prior to the then-current expiration date under such Summit Lease Sweep Lease.
“Summit Lease Sweep Lease” means the Amazon lease or any qualified replacement lease.
Puget Sound Recapture – the borrowers have the right, without the lender’s consent, to amend that certain leased space, pursuant to a lease agreement, dated as of May 11, 2018 (the “Puget Sound Energy Lease”) by and between Hines Global REIT Summit Holdings LLC and Puget Sound Energy, Inc. (“Puget Sound Energy Tenant”) from time to time to reduce the premises demised thereunder (any such space that is removed from the Puget Sound Energy Lease, until it is released in accordance with The Summit loan agreement, the “Recaptured Puget Sound Space”) and to make corresponding reductions to the Puget Sound Energy Tenant’s rent and other obligations thereunder, provided (a) no event of default is continuing, (b) the aggregate amount of all Recaptured Puget Sound Space will not exceed 223,820 square feet in the aggregate, and (c) the pro-forma Debt Yield is equal to or greater than the loan origination date Debt Yield, and the borrowers satisfy the if and only if (i) any such newly executed lease demising all or any portion of the Recaptured Puget Sound Space is a qualifying lease under The Summit loan agreement, and (ii) the borrowers have (A) remitted funds into the Replacement Lease Reserve Account or (B) delivered to the lender a letter of credit in the amount required to be remitted into the Replacement Lease Reserve Account as set forth in sub-clause (A), in each case in such aggregate amount as required under The Summit Whole Loan documents.
For purposes of calculating the pro-forma Debt Yield related to the Puget Sound Recapture, the pro-forma Debt Yield will reflect the increase in revenues from any newly executed leases demising such Recaptured Puget Sound Space (and without regard to the commencement date of such lease). The borrowers have the right to prepay The Summit Whole Loan, post cash collateral, or deliver to the lender a letter of credit in such amount which, if applied in reduction of outstanding principal of The Summit Whole Loan, would result in a Debt Yield equal to or exceeding the loan origination date Debt Yield.
Lockbox / Cash Management. The Summit Whole Loan is structured with a hard lockbox and springing cash management. The borrowers were required to direct each tenant to remit all rents directly to a lender-controlled lockbox account. In addition, the borrowers are required to cause all cash revenues relating to The Summit Property and all other money received by the borrowers or the property manager with respect to The Summit Property (other than tenant security deposits) to be deposited into the lockbox account or a lender-controlled cash management account within two business day of receipt. On each business day during the continuance of a Summit Cash Sweep Period or event of default under The Summit Whole Loan, all amounts in the lockbox account are required to be remitted to the cash management account. On each business day that no Summit Cash Sweep Period or event of default under The Summit Whole Loan is continuing, all amounts in the lockbox account are required to be remitted to a borrower-controlled operating account.
On each due date during the continuance of a Summit Cash Sweep Period or an event of default under The Summit Whole Loan, all funds on deposit in the cash management account after payment of debt service on The Summit Whole Loan, required reserves and budgeted operating expenses are required to be deposited into an excess cash flow reserve account as additional collateral for The Summit Whole Loan.
Current Mezzanine or Subordinate Indebtedness. None.
Future Mezzanine or Subordinate Indebtedness Permitted. None.
Partial Release. None.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Contacts |
J.P. Morgan CMBS Capital Markets & Banking | ||
Contact | Phone Number | |
Kunal Singh Managing Director | kunal.k.singh@jpmorgan.com | (212) 834-5467 |
Brad Horn Executive Director | bradley.j.horn@jpmorgan.com | (212) 834-9708 |
Harris Rendelstein Vice President | harris.rendelstein@jpmorgan.com | (212) 834-6737 |
J.P. Morgan CMBS Trading | ||
Contact | Phone Number | |
Avinash Sharma Managing Director | avinash.sharma@jpmorgan.com | (212) 834-3111 |
Derrick Fetzer Vice President | derrick.e.fetzer@jpmchase.com | (212) 834-3111 |
J.P. Morgan Securitized Products Syndicate | ||
Contact | Phone Number | |
Jennifer Kornblau Executive Director | jennifer.l.kornblau@jpmorgan.com | (212) 834-4154 |
Morgan Roach Vice President | morgan.c.roach@jpmchase.com | (212) 834-4154 |
Deutsche Bank CMBS Capital Markets & Banking | ||
Contact | Phone Number | |
Lainie Kaye Managing Director | lainie.kaye@db.com | (212) 250-5270 |
Cameron Cleveland Director | cameron.cleveland@db.com | (212) 250-9410 |
Deutsche Bank CMBS Trading | ||
Contact | Phone Number | |
Ryan Horvath Director | ryan.horvath@db.com | (212) 250-5149 |
Deutsche Bank CMBS Structuring | ||
Contact | Phone Number | |
Shaishav Agarwal Managing Director | shaishav.agarwal@db.com | (212) 250-6290 |
Dan Penn Director | daniel.penn@db.com | (212) 250-5149 |
Citigroup CMBS Capital Markets & Securitization | ||
Contact | Phone Number | |
Rick Simpson Director | richard.simpson@citi.com | (212) 816-5343 |
Jason Mercandetti Vice President | jason.mercandetti@citi.com | (212) 816-6384 |
Citigroup Structuring, Trading & Syndicate | ||
Contact | Phone Number | |
Raul Orozco Director | raul.d.orozco@citi.com | (212) 723-1295 |
Mattison Perry Director | mattison.perry@citi.com | (212) 723-1295 |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
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Structural and Collateral Term Sheet | Benchmark 2022-B32 | |
Contacts |
Goldman Sachs & Co. LLC Banking | |||
Contact | Phone Number | ||
Leah Nivison Managing Director | leah.nivison@gs.com | (212) 357-2702 | |
Scott Epperson Managing Director | scott.epperson@gs.com | (212) 934-2882 | |
Justin Peterson Vice President | justin.peterson@gs.com | (212) 902-4283 | |
Goldman Sachs & Co. LLC Capital Markets | |||
Contact | Phone Number | ||
Mark Romanczuk Managing Director | mark.romanczuk@gs.com | (212) 902-0290 | |
Nitin Jagga Vice President | nitin.jagga@gs.com | (212) 855-9035 | |
Goldman Sachs & Co. LLC Syndicate | |||
Contact | Phone Number | ||
Scott Walter Managing Director | scott.walter@gs.com | (212) 357-8910 | |
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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