KBRA Affirms All Ratings for GSMS 2014-GC20
28 Mar 2025 | New York
KBRA affirms all ratings for GSMS 2014-GC20, a $62.6 million CMBS conduit transaction which has three assets remaining in the mortgage pool, each of which have been identified as K-LOCs. The affirmations follow a surveillance review of the transaction and are based on the performance and expected recovery of the transaction's three assets, which have not meaningfully changed since KBRA's last ratings change in February 2022. As of the March 2025 remittance period, two of the assets (67.0% of the pool balance) are REO, while the remaining loan (33.0%) has a performing matured balloon status. The details of the assets are outlined below.
Sheraton Suites Houston (largest, 53.7%, K-LOC, Specially Serviced, REO)
- The asset is a 14-story, 283-key, full-service hotel located in the Uptown/Galleria district of Houston, Texas, approximately nine miles west of the city’s CBD.
- KBRA maintains the asset's K-LOC designation based on its REO status since 2021. The appointed receiver is Driftwood Hospitality Management. The property recently underwent a $12.2 million PIP to rebrand the property as "The Chifley" in conjunction with its new franchise agreement with Hilton's Tapestry Collection. According to the special servicer, a sale is expected in Q2 2025.
- The subject was reappraised for $48.5 million ($174,912 per key) in December 2024, a 19.9% decline from $61.8 million ($218,375 per key) at issuance. KBRA's analysis resulted in an estimated loss of $17.0 million on a whole loan balance of $33.6 million (50.5% estimated loss severity).
Oklahoma Hotel Portfolio (2nd largest, 33.0%, K-LOC, Specially Serviced, Performing Matured Balloon)
- The loan is collateralized by two full-service and one limited-service hotel with a total of 320 keys. The three hotels are Holiday Inn Stillwater, Hilton Garden Inn Norman and Hampton Inn & Suites Durant.
- KBRA maintains the loan's K-LOC designation based on its performing matured balloon status with the special servicer after failing to pay off at its April 2024 maturity. The borrower had proposed an 18-month maturity extension which the special servicer rejected; the borrower is now working to secure refinance options. In the meantime, the loan is cash managed, and the borrower and lender have been engaged in workout discussions while the lender is exercising enforcement actions. The decline in performance at the property can largely be attributed to the renovation and rebranding of the Hampton Inn & Suites Durant hotel, which has been closed since the onset on the pandemic and remains closed as of March 2025.
- The subject was reappraised for $26.4 million ($82,500 per key) in May 2024, a 36.1% decline from $41.3 million ($129,063 per key) at issuance. KBRA's analysis resulted in an estimated loss of $5.0 million on a whole loan balance of $20.7 million (24.2% estimated loss severity).
Northgate Power Center (3rd largest, 13.3%, K-LOC, Specially Serviced, REO)
- The asset is a a 106,015 sf retail property in Colerain Township, Ohio, approximately 12 miles northwest of the Cincinnati CBD.
- KBRA maintains the asset's K-LOC designation based on its REO status as of February 2024. The loan transferred to the special servicer in August 2023 for imminent monetary default. The borrower turned over the property via a deed in lieu of foreclosure prior to the loan's February 2024 maturity. According to the special servicer, the property is not being marketed for sale at this time.
- The subject was reappraised for $6.5 million ($62 per sf) in March 2024, a 56.2% decline from $14.9 million ($141 per sf) at issuance. KBRA's analysis resulted in an estimated loss of $3.9 million on a whole loan balance of $8.3 million (46.9% estimated loss severity).
Rating Sensitivities
Future rating actions will be dependent upon the ongoing assessment of the timing and likelihood of ultimate payment of principal and accrued interest on the rated certificates. The assessment will consider the expected and actual losses on the remaining assets in the transaction, as well as, the magnitude and extent of interest shortfalls, if any, on the certificates.
To access ratings and relevant documents, click here.
Related Publication
Methodologies
- CMBS: North American CMBS Property Evaluation Methodology
- CMBS: North American CMBS Single Borrower & Large Loan Rating Methodology
- CMBS: Methodology for Rating Interest-Only Certificates in CMBS Transactions
- Structured Finance: Global Structured Finance Counterparty Methodology
- ESG Global Rating Methodology