Fitch Affirms IMSCI Commercial Mortgage Pass-Through Certificates, Series 2014-5

CHICAGO--(BUSINESS WIRE)-- Fitch Ratings has affirmed all rated classes of Institutional Mortgage Securities Canada Inc.'s (IMSCI) commercial mortgage pass-through certificates, series 2014-5. A full list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

The affirmations reflect the transaction's stable performance since issuance. As of the July 2015 distribution date, the pool's aggregate principal balance has been reduced by 9.6% to $281.9 million from $311.8 million at issuance. No loans are defeased or delinquent. There are no classes experiencing interest shortfalls. Three loans have paid in full since issuance.

In addition, the ratings reflect strong historical Canadian commercial real estate loan performance, including a low delinquency rate and low historical losses, as well as positive loan attributes, including short amortization schedules and recourse to the borrower and additional guarantors. Of the pool, 83.8% of the loans feature full or partial recourse to the borrowers and sponsors.

The largest loan in the pool is Milton Crossroads West (8% of the pool), which is secured by an anchored retail center located in Milton, Ontario. The property was originally three buildings, with two additional buildings to be developed. Major collateral tenants include SportChek, Indigo and Michael's. The loan is sponsored by Calloway REIT and First Gulf Development Corporation.

The second largest loan is Les Galeries Richelieu (7.1% of the pool), which is secured by a two-building, 227,161-sf shopping center located in Saint-Jean-sur-Richelieu (SJR), Quebec. SJR is located approximately 50 kilometers southeast of Montreal. The major tenants are Le CSSS Haut-Richelieu-Rouville (CSSS), a community health center run by the provincial government, Provigo Distribution (operating as Maxi) and Bureau en Gros (part of the Staples chain). The loan sponsor is BTB Real Estate Investment Trust.

RATING SENSITIVITIES

The Rating Outlook remains Stable for all classes. Due to the recent issuance of the transaction and stable performance, Fitch does not foresee positive or negative ratings migration until a material economic or asset-level event changes the transaction's portfolio-level metrics. Additional information on rating sensitivity is available in the report 'IMSCI 2014-5' (July 2, 2014), available at www.fitchratings.com.

DUE DILIGENCE USAGE

No third party due diligence was provided or reviewed in relation to this rating action.

A comparison of the transaction's Representations, Warranties, and Enforcement (RW&E) mechanisms to those of typical RW&Es for the asset class is available in the following report:

--'IMSCI 2014-5 -- Appendix' (July 2, 2014).

Fitch has affirmed the following ratings:

--$122.4 million class A-1 at 'AAAsf'; Outlook Stable;

--$119 million class A-2 at 'AAAsf'; Outlook Stable;

--$6.2 million class B at 'AAsf'; Outlook Stable;

--$9.4 million class C at 'Asf'; Outlook Stable;

--$8.2 million class D at 'BBBsf'; Outlook Stable;

--$4.7 million class E at 'BBB-sf'; Outlook Stable;

--$3.1 million class F at 'BBsf'; Outlook Stable;

--$3.1 million class G at 'Bsf'; Outlook Stable.

Fitch does not rate the interest-only class X or the non-offered $5.8 million class H certificate.

All currencies are in Canadian dollars (CAD).

Additional information is available at www.fitchratings.com.

Applicable Criteria

Criteria for Analyzing Multiborrower U.S. and Canadian Commercial Mortgage Transactions (pub. 28 May 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=865499

Global Structured Finance Rating Criteria (pub. 06 Jul 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952

U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria (pub. 10 Dec 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=812608

Related Research

IMSCI 2014-5 -- Appendix

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=751409

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=987960

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=987960

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20150715006270/en/

Fitch Ratings
Primary Analyst
Jeffrey Diliberto
Director
+1-312-368-3268
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Committee Chairperson
Mary MacNeill
Managing Director
+1-212-908-0785
or
Media Relations:
Sandro Scenga, +1 212-908-0278
[email protected]

Source: Fitch Ratings

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