NEW YORK, July 7, 2015 /PRNewswire/ -- Morningstar Credit Ratings, LLC today affirmed its 'MOR CS2' commercial mortgage special servicer ranking for Rialto Capital Advisors, LLC. Morningstar's forecast for the ranking is Stable.
Morningstar affirmed its ranking based on Rialto's continued asset-resolution success for its opportunity funds, structured FDIC transactions, and nonperforming loan securitizations. Rialto is principally a named special servicer for new-issue commercial mortgage-backed securities (CMBS) and, as a result, has resolved few assets within the conventional CMBS framework. The affirmed ranking also considers Rialto's experienced staff, strong technology, diligent asset analytics, robust compliance practices, and sound internal audit procedures that center on FDIC-commissioned reviews. To the extent Rialto's active servicing portfolio becomes more concentrated with CMBS and non-FDIC-related assets, the company may benefit from an expanded audit regimen.
Rialto Capital Advisors, LLC is the asset-management unit of Rialto Capital Management, LLC, a wholly owned subsidiary of Lennar Corporation. As of Dec. 31, 2014, Rialto Capital Advisors was the named special servicer on 45 CMBS that consisted of 3,071 loans with an aggregate unpaid principal balance (UPB) of approximately $49.0 billion. The active servicing portfolio consisted of 4,602 assets with an aggregate UPB of approximately $1.9 billion. Approximately 78 percent of the assets by count consisted of land, residential, and nontraditional real estate collateral, and most assets had a UPB of $3.0 million or less. The active CMBS servicing portfolio consisted of 28 assets with an aggregate UPB of approximately $124.1 million, comprising 20 assets in FDIC 2012-C1, an unrated securitization, and eight loans in new-issue rated transactions.
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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.
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