Welcome!

News Feed Item

Morningstar Credit Ratings, LLC Affirms 'MOR CS2' Commercial Mortgage Primary Servicer Ranking for Situs; Raises Special Servicer Ranking to 'MOR CS1'

NEW YORK, April 2, 2014 /PRNewswire/ -- Morningstar Credit Ratings, LLC today affirmed its 'MOR CS2' commercial mortgage primary servicer ranking for Situs Asset Management LLC, and raised its commercial mortgage special servicer ranking for Situs Holdings, LLC to 'MOR CS1' from 'MOR CS2.' The affirmed primary servicer ranking and raised special servicer ranking are based on the following factors:

Primary Servicer Ranking:

  • Stabilizing operations: Situs had high staff turnover rates during 2013 as the company made further organizational modifications as part of a revised business strategy initiated in early 2012. Signs now indicate that the company's employee turnover rate in 2014 should be much lower.
  • Effective and strengthened technology: Situs has effective technology tools for its loan administration and portfolio management duties, which now involve more large-scale assets and customized reporting. In Morningstar's view, the company's conversion to a new servicing system in 2012, along with other completed technology enhancements, is strengthening its servicing capabilities.
  • Solid professional experience and depth: Situs has retained an experienced professional staff and an organizational structure that promotes portfolio management accountability. Situs also has an effective training function.
  • Sound internal audit and new compliance program: Situs has a multi-level internal audit function that examines its operations annually. Recently completed audits cited no material exceptions related to operational controls and procedures. Situs also established a formal compliance function for primary servicing in 2013.
  • Effective portfolio management: Situs has diligent practices to monitor collateral performance and handle credit issues. The company has experience with highly structured assets, distressed portfolios, and providing investors customized surveillance and asset management.    
  • No commercial mortgage-backed securities (CMBS) servicing history, yet robust client reporting capabilities: According to Morningstar, Situs has proven capabilities to deliver customized and detailed investor reporting. While the company has not yet served as a primary servicer for a government-sponsored entity or other CMBS, Situs services one securitized small-balance portfolio. The company also provides supplemental commercial real estate finance council (CREFC)-compliant portfolio surveillance reporting to certain CMBS investors.  

Special Servicer Ranking:

  • Extended record of asset resolution achievement: Situs demonstrates highly successful asset resolution performance results involving many challenging assets nationwide. Morningstar considers Situs to be a very adept CMBS special servicer. 
  • Very experienced professional team: Situs continues to have a highly experienced management team and asset managers. Adding further professional depth, the operation includes a dedicated asset management subsidiary for a bank-owned portfolio.
  • Excellent technology: Situs uses a highly effective proprietary asset management system that is well-suited for CMBS reporting and integrated with the company's other applications.
  • Well-controlled, diligent asset analytics and management: Situs has diligent and controlled asset analysis practices. The company also strengthened its real estate-owned (REO) property oversight by establishing an ongoing property management company audit program.   
  • Sound internal audit and compliance functions: The special servicing operation undergoes annual audits and has its own compliance function. Recently completed audits indicated no material exceptions related to operational controls and procedures.
  • Effective conflicts of interest management: Situs is a CMBS special servicer for transactions in which two affiliated investors respectively hold first-loss positions and are the controlling class holders. In Morningstar's view, Situs has sound practices to manage any conflicts of interest in this regard.

As of Dec. 31, 2013, Situs' primary servicing portfolio consisted of 879 loans with an unpaid principal balance (UPB) of approximately $12.1 billion. The portfolio included one securitized transaction and three commercial real estate collateralized debt obligation (CRE CDO) transactions. As of Dec. 31, 2013, Situs was the named special servicer for 1,907 loans with an approximate UPB of $23.2 billion, including 18 CMBS transactions. The company's total active special servicing portfolio contained 320 assets with a combined UPB of approximately $2.4 billion. The active CMBS portfolio comprised 97 assets with a combined UPB of approximately $1.2 billion.

The forecast for both rankings remains Stable. As a primary servicer, Situs should continue to operate effectively to meet its clients' servicing and portfolio management requirements. Morningstar also believes the company will continue to maintain the practices and expertise to serve as a highly effective special servicer for CMBS and other investors. 

To access Morningstar's operational risk assessment methodology and all published reports, please visit https://ratingagency.morningstar.com

About Morningstar Credit Ratings, LLC and Morningstar, Inc.
Morningstar Credit Ratings, LLC is a Nationally Recognized Statistical Rating Organization (NRSRO) that specializes in structured credit research and ratings, and offers a wide array of services including new-issue ratings and analysis, operational risk assessments, surveillance services, data, and technology solutions.

Morningstar Credit Ratings' rankings, forecasts, and assessments contained in this press release are evaluations and opinions of non-credit related risks, and therefore, are not credit ratings within the meaning of Section 3 of the Securities Exchange Act of 1934 ("Exchange Act") or credit ratings subject to the Exchange Act requirements and regulations promulgated thereunder with respect to credit ratings issued by NRSROs.

Morningstar Credit Ratings, LLC is a subsidiary of Morningstar, Inc. (NASDAQ: MORN), a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offers an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors. Morningstar provides data on approximately 446,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 10 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its registered investment advisor subsidiaries and had approximately $159 billion in assets under advisement and management as of Dec. 31, 2013. The company has operations in 27 countries.

Morningstar, Inc. is not an NRSRO and its credit ratings on corporate and municipal issuers are not NRSRO credit ratings.

©2014 Morningstar, Inc.  All rights reserved.

MORN-R

Media Contact:
Michelle Weiss, +1 267-960-6014 or [email protected]

SOURCE Morningstar, Inc.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
"Codigm is based on the cloud and we are here to explore marketing opportunities in America. Our mission is to make an ecosystem of the SW environment that anyone can understand, learn, teach, and develop the SW on the cloud," explained Sung Tae Ryu, CEO of Codigm, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
"With Digital Experience Monitoring what used to be a simple visit to a web page has exploded into app on phones, data from social media feeds, competitive benchmarking - these are all components that are only available because of some type of digital asset," explained Leo Vasiliou, Director of Web Performance Engineering at Catchpoint Systems, in this SYS-CON.tv interview at DevOps Summit at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
The “Digital Era” is forcing us to engage with new methods to build, operate and maintain applications. This transformation also implies an evolution to more and more intelligent applications to better engage with the customers, while creating significant market differentiators. In both cases, the cloud has become a key enabler to embrace this digital revolution. So, moving to the cloud is no longer the question; the new questions are HOW and WHEN. To make this equation even more complex, most ...
Enterprise architects are increasingly adopting multi-cloud strategies as they seek to utilize existing data center assets, leverage the advantages of cloud computing and avoid cloud vendor lock-in. This requires a globally aware traffic management strategy that can monitor infrastructure health across data centers and end-user experience globally, while responding to control changes and system specification at the speed of today’s DevOps teams. In his session at 20th Cloud Expo, Josh Gray, Chie...
Learn how to solve the problem of keeping files in sync between multiple Docker containers. In his session at 16th Cloud Expo, Aaron Brongersma, Senior Infrastructure Engineer at Modulus, discussed using rsync, GlusterFS, EBS and Bit Torrent Sync. He broke down the tools that are needed to help create a seamless user experience. In the end, can we have an environment where we can easily move Docker containers, servers, and volumes without impacting our applications? He shared his results so yo...
FinTechs use the cloud to operate at the speed and scale of digital financial activity, but are often hindered by the complexity of managing security and compliance in the cloud. In his session at 20th Cloud Expo, Sesh Murthy, co-founder and CTO of Cloud Raxak, showed how proactive and automated cloud security enables FinTechs to leverage the cloud to achieve their business goals. Through business-driven cloud security, FinTechs can speed time-to-market, diminish risk and costs, maintain continu...
Creating replica copies to tolerate a certain number of failures is easy, but very expensive at cloud-scale. Conventional RAID has lower overhead, but it is limited in the number of failures it can tolerate. And the management is like herding cats (overseeing capacity, rebuilds, migrations, and degraded performance). In his general session at 18th Cloud Expo, Scott Cleland, Senior Director of Product Marketing for the HGST Cloud Infrastructure Business Unit, discussed how a new approach is neces...
"This week we're really focusing on scalability, asset preservation and how do you back up to the cloud and in the cloud with object storage, which is really a new way of attacking dealing with your file, your blocked data, where you put it and how you access it," stated Jeff Greenwald, Senior Director of Market Development at HGST, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Businesses and business units of all sizes can benefit from cloud computing, but many don't want the cost, performance and security concerns of public cloud nor the complexity of building their own private clouds. Today, some cloud vendors are using artificial intelligence (AI) to simplify cloud deployment and management. In his session at 20th Cloud Expo, Ajay Gulati, Co-founder and CEO of ZeroStack, discussed how AI can simplify cloud operations. He covered the following topics: why cloud mana...
Docker containers have brought great opportunities to shorten the deployment process through continuous integration and the delivery of applications and microservices. This applies equally to enterprise data centers as well as the cloud. In his session at 20th Cloud Expo, Jari Kolehmainen, founder and CTO of Kontena, discussed solutions and benefits of a deeply integrated deployment pipeline using technologies such as container management platforms, Docker containers, and the drone.io Cl tool. H...
Everything run by electricity will eventually be connected to the Internet. Get ahead of the Internet of Things revolution. In his session at @ThingsExpo, Akvelon expert and IoT industry leader Sergey Grebnov provided an educational dive into the world of managing your home, workplace and all the devices they contain with the power of machine-based AI and intelligent Bot services for a completely streamlined experience.
Kubernetes is a new and revolutionary open-sourced system for managing containers across multiple hosts in a cluster. Ansible is a simple IT automation tool for just about any requirement for reproducible environments. In his session at @DevOpsSummit at 18th Cloud Expo, Patrick Galbraith, a principal engineer at HPE, discussed how to build a fully functional Kubernetes cluster on a number of virtual machines or bare-metal hosts. Also included will be a brief demonstration of running a Galera MyS...
It is of utmost importance for the future success of WebRTC to ensure that interoperability is operational between web browsers and any WebRTC-compliant client. To be guaranteed as operational and effective, interoperability must be tested extensively by establishing WebRTC data and media connections between different web browsers running on different devices and operating systems. In his session at WebRTC Summit at @ThingsExpo, Dr. Alex Gouaillard, CEO and Founder of CoSMo Software, presented ...
Enterprises are universally struggling to understand where the new tools and methodologies of DevOps fit into their organizations, and are universally making the same mistakes. These mistakes are not unavoidable, and in fact, avoiding them gifts an organization with sustained competitive advantage, just like it did for Japanese Manufacturing Post WWII.
DXWorldEXPO LLC, the producer of the world's most influential technology conferences and trade shows has announced the 22nd International CloudEXPO | DXWorldEXPO "Early Bird Registration" is now open. Register for Full Conference "Gold Pass" ▸ Here (Expo Hall ▸ Here)