Fitch Ratings has assigned the following ratings and Ratings Outlooks to NRTH 2024-PARK commercial mortgage pass-through series 2024-PARK.

RATING ACTIONS

Entity / Debt

Rating

Prior

NRTH 2024-PARK

A

LT

AAAsf

New Rating

AAA(EXP)sf

HRR

LT

AAsf

New Rating

AA(EXP)sf

Page

of 1

VIEW ADDITIONAL RATING DETAILS

$617,500,000 class A 'AAAsf'; Outlook Stable;

$32,500,000ab class HRR 'AAsf'; Outlook Stable.

(a)	Since Fitch published its expected ratings on Feb. 28, 2024, the balances for class A and HRR have been finalized. The initial certificate balances for class A and HRR have not changed since Fitch published its expected ratings on Feb. 28, 2024. The classes above reflect the final ratings and deal structure.
(b)	Non-offered horizontal risk retention interest representing approximately 5.0 % of the estimated fair value of all classes.

Transaction Summary

The NRTH 2024-PARK commercial mortgage pass-through certificates series 2024-PARK (NRTH 2024-PARK) represent the beneficial interest in a trust that holds a two-year, floating-rate, IO $650 million commercial mortgage loan with three one-year extension options. The mortgage loan is secured by the borrower's fee simple interest in NorthPark Center, a 1.9 million sf super-regional mall located in Dallas, TX.

Whole loan proceeds will be used to refinance $487.4 million of existing debt secured by the property, return $124.5 million in equity to the borrower, fund a contractual leasing cost escrow of approximately $22.1 million and pay closing costs. The certificates will follow a sequential-pay structure. The transaction is expected to close on March 15, 2024.

KEY RATING DRIVERS

Fitch Net Cash Flow: Fitch's net cash flow (NCF) for the property is estimated at $77.4 million; this is 8.2% lower than the issuer's NCF and 9.6% higher than the YE23 NCF. Fitch applied a 7.0% cap rate to derive a Fitch value of $1.11 billion.

Low Fitch Leverage: The $650 million total mortgage loan ($339/psf) has a Fitch loan-to-value ratio (LTV) is 58.8%, stressed debt service coverage ratio (DSCR) of 1.49x, and debt yield of 11. 9%. The loan represents approximately 45.8% of the appraised value of $1.42 billion.

Strong Sales Performance and Low Occupancy Costs: The property reported strong overall sales of approximately $1.36 billion ( or $710 psf) as of the TTM ended in November 2023, with inline tenant sales (less than 10,000 sf) of $1,523 psf (or $1,276 psf excluding Apple). This represents a 15.3% increase over 2021 inline sales of $1,338 psf ($1,160 psf excluding Apple). Additionally, the November 2023 TTM inline occupancy cost was 11.5% (14.0% excluding Apple). The inline occupancy cost has averaged 10.9% (13.2% excluding Apple) since 2019.

High Quality Retail Asset in Core Location: The property is a 1.9 million sf, super-regional mall with over 200 retail shops, restaurants and entertainment tenants. It is centrally located in the northern portion of Dallas, TX, at the intersection of the Northwest Highway (Texas Highway 12) and the North Central Expressway (U.S. Highway 75). The property is home to over 30 global luxury brands, including the top performing Neiman Marcus in the country according to the sponsor.

The property is anchored by Dillard's, Macy's, Neiman Marcus, Nordstrom, Eataly and a 15-screen AMC theater; these six tenants reportedly generated over $507 million in sales as of the TTM ended in November 2023.

Long-Term Ownership and Management: Since 1965, the property has been owned (in whole or in part) and operated by two generations of the Nasher/Haemisegger family. In 2014, Strategic Property Fund, a core U.S. real estate fund sponsored by J.P. Morgan Asset Management acquired a 60% interest in the property from the Nasher family. NorthPark Management Company has leased and managed the property exclusively for almost 60 years.

RATING SENSITIVITIES

Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade

Defined stresses describe the impact of two defined stress assumptions: an up-stress, reflecting a 10% increase to Fitch's NCF at the time of issuance; and NCF reduced 10% from Fitch's NCF at the time of issuance. The following table shows the impact on ratings for each additional defined stress to NCF.

Original Rating: 'AAAsf' / 'AAsf'

10% NCF Decline: 'AAAsf' / 'AAsf'

Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade

Improvement in cash flow increases property value and capacity to meet its debt service obligations. The table below indicates the model implied rating sensitivity to changes to the same one variable, Fitch NCF:

Original Rating: 'AAAsf' / 'AAsf';

10% NCF Increase: 'AAAsf' / 'AAAsf'.

USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10

Fitch was provided with Form ABS Due Diligence-15E (Form 15E) as prepared by Ernst and Young LLP. The third-party due diligence described in Form 15E focused on a comparison and re-computation of certain characteristics with respect to the mortgage loan. Fitch considered this information in its analysis and it did not have an effect on Fitch's analysis or conclusions.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING

The principal sources of information used in the analysis are described in the Applicable Criteria.

REPRESENTATIONS, WARRANTIES AND ENFORCEMENT MECHANISMS

A description of the transaction's representations, warranties and enforcement mechanisms (RW&Es) that are disclosed in the offering document and which relate to the underlying asset pool is available by clicking the link to the Appendix. The appendix also contains a comparison of these RW&Es to those Fitch considers typical for the asset class as detailed in the Special Report titled 'Representations, Warranties and Enforcement Mechanisms in Global Structured Finance Transactions'.

A description of the transaction's representations, warranties and enforcement mechanisms (RW&Es) that are disclosed in the offering document and which relate to the underlying asset pool is available by clicking the link to the Appendix. The appendix also contains a comparison of these RW&Es to those Fitch considers typical for the asset class as detailed in the Special Report titled 'Representations, Warranties and Enforcement Mechanisms in Global Structured Finance Transactions'.

ESG Considerations

The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. For more information on Fitch's ESG Relevance Scores, visit https://www.fitchratings.com/topics/esg/products#esg-relevance-scores.

Additional information is available on www.fitchratings.com

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