DBRS, Inc. (Morningstar DBRS) assigned its MOR CS3 commercial mortgage special servicer ranking to Green Loan Services LLC (GLS or the Company), a wholly owned subsidiary of SL Green Realty Corp (SL Green).

The trend for the ranking is Stable.

The assigned ranking reflects these factors:

GLS' modest, albeit successful, asset resolution record that has centered on single-asset single-borrower (SASB) loans in commercial mortgage-backed securities (CMBS) transactions. Corresponding with SL Green's position as the largest office building owner/manager in Manhattan (according to SL Green and other sources), GLS' activity and area of expertise especially involves large-scale office loans in the same market. However, the Company has handled large loans secured by retail and other property types in some other metropolitan areas. Although GLS' CMBS special servicing work has involved only loans rather than real estate owned (REO) assets, it has managed some foreclosures over the years and has advised clients on the management and sale of their privately held real estate.

The Company's well-experienced and tenured senior-level managers who directly oversee every specially serviced asset. The team-based organizational approach leverages SL Green's resources and expertise for consultation on leasing, construction management, property management, market intelligence, and asset repositioning.

Adequate technology that relies on spreadsheet files used in tandem with purchased applications for data management, valuations/cash flow modeling, and property accounting. Unlike most special servicers, the Company does not have a singular or core asset management application. Through SL Green, GLS has overall acceptable protocols for data backup, recovery testing, and cybersecurity.

Proactive loan surveillance, thorough analytics, and acceptable approval controls based on GLS' stated practices, although its policies and procedures are not especially detailed or routinely updated every year.

GLS has thus far handled its CMBS reporting responsibilities in a satisfactory manner.

An acceptable audit function consisting of annual Regulation AB attestations that have been clear of exceptions. GLS also noted that SL Green's Sarbanes-Oxley 404 financial reporting examinations, although not operationally focused, touch on some areas of GLS.

As of December 31, 2023, GLS was a named special servicer on six SASB loans with an aggregate remaining unpaid principal balance (UPB) of $5.12 billion. The Company was not affiliated with any of the controlling classholders in these CMBS transactions.

As of December 31, 2023, the active special servicing portfolio consisted of two CMBS loans with a total UPB of $724.0 million (five collateral properties) and two nonsecuritized REO properties. All assets, except for one REO property in Westchester County, New York, were in Manhattan.

All rankings are subject to surveillance, which could result in rankings being raised, lowered, placed under review, confirmed, or discontinued by Morningstar DBRS.

Morningstar DBRS North American commercial mortgage servicer rankings are not credit ratings. Instead, they are designed to evaluate the quality of the parties that service commercial mortgage loans. Although the servicer's financial condition contributes to the applicable ranking, its relative importance is such that a servicer's ranking should never be considered as a proxy of its creditworthiness.

Notes:

All figures are in U.S. dollars unless otherwise noted.

The principal methodology is North American Commercial Mortgage Servicer Rankings (August 23, 2023; https://dbrs.morningstar.com/research/419592).

For more information on this industry, visit dbrs.morningstar.com or contact us at info-DBRS@morningstar.com.

DBRS, Inc.

140 Broadway, 43rd Floor

New York, NY 10005 USA

Tel. +1 212 806-3277

(C) 2024 Electronic News Publishing, source ENP Newswire