KBRA Affirms All Ratings for GSMS 2013-GCJ14
5 Jun 2025 | New York
KBRA affirms all of its outstanding ratings for GSMS 2013-GCJ14, a $67.5 million CMBS conduit transaction. The affirmations follow a surveillance review of the transaction and are based on the performance and expected recovery of the two remaining loans, which have both been identified as K-LOCs.
As of the May 2025 remittance period, one loan (61.8% of the pool balance) is specially serviced and in foreclosure. The details of the loans are outlined below.
Cranberry Woods Office Park (largest, 61.8%, K-LOC, Specially Serviced)
- The loan is collateralized by a 346,478 sf, Class-A suburban office complex located in Cranberry Township, Pennsylvania, approximately 21 miles north of the Pittsburgh CBD. The three, four-story collateral buildings were developed on a 33.6-acre site between 1999 and 2003.
- KBRA identified the loan as a K-LOC and maintains the KPO of Underperform based its foreclosure status with the special servicer. The loan transferred to the special servicer in August 2023 due to maturity default. The loan has experienced declining performance since the largest tenant, NetApp Inc., downsized to 35,733 sf from 85,503 sf in April 2022, reducing the occupancy in Building 800 to 56.0% as of December 2022. Giant Eagle, Inc. executed a lease for 107,033 sf that commenced in March 2024. As of the February 2025 rent roll, the portfolio occupancy is 87.2%. KBRA's analysis produced a KNCF of $4.0 million, 16.1% below the $4.8 million KNCF at closing.
- The servicer-reported occupancies and DSCs are: N/A / 1.55x (FY 2023); 86.0% / 1.35x (FY 2022); at closing these were 99.0% / 1.45x. An appraisal dated October 2024 valued the property at $59.0 million ($170 per sf), representing a 20.8% decrease from closing ($74.5 million; $215 per sf). KBRA’s analysis resulted in an estimated loss of $866,282 (2.1% estimated loss severity) on the loan balance of $41.7 million. The loss is based on KBRA's liquidation value of $42.4 million ($122 per sf). The value is derived from a direct capitalization approach using a KNCF of $4.0 million and a capitalization rate of 9.50%.
Mall St. Matthews (2nd largest, 38.2%, K-LOC, Current)
- The loan is collateralized by 670,376 sf of a 1.0 million sf, single-level regional mall located in Louisville, Kentucky, approximately seven miles east of the city’s CBD. The property, which is owned and operated by Brookfield Property Partners, has three anchors, Dillard’s, Dillard’s Men’s & Home, and JCPenney. Dillard’s owns its stores and the underlying land and JCPenney owns its improvements subject to a ground lease with the sponsor.
- KBRA maintains the loan's K-LOC designation and KPO of Underperform based on a loan modification that was signed in March 2022 converting the loan to interest-only payments and extending its maturity until June 2025. The modification included a $7.0 million contribution of new capital from the borrower along with cash management going towards the reduction of the outstanding principal of the loan. The loan is also subject to a capital event waterfall that upon loan pay off would result in a minimum balance of $75.0 million to be repaid to the lender followed by additional capital event tiers between the lender and borrower.
- According to the December 2024 rent roll, the subject property was 93.7% leased compared to 91.2% at last review and 95.8% at closing. Tenant rollover risk remains a concern as lease rollover exceeds 10.0% of base rent in MTM/2025 (21.5%), 2026 (17.3%), 2027 (13.1%) and 2028 (16.2%). There are currently 20 tenants, representing 21.5% of base rent, on MTM leases or which have leases expiring in 2025.
- The servicer-reported occupancies and DSCs are: 92.0% / 1.54x (FY 2024); 94.0% / 1.51x (FY 2023); at closing these were 96.0% / 1.96x. An appraisal dated August 2021 valued the asset at $83.0 million ($124 per sf), which is 70.4% below the $280.0 million ($418 per sf) value at issuance. As of May 2025, the loan is current on payments and not specially serviced. However, in the event of a default, KBRA estimates that it could experience a loss given default of $43.6 million (36.1% estimated loss severity) on the whole loan balance of $120.7 million. The loss is based on a KBRA liquidation value of $77.4 million ($74 per sf). The value is derived from a direct capitalization approach using a KNCF of $11.6 million and a capitalization rate of 15.00%.
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.