OREANDA-NEWS. S&P Global Ratings today affirmed its overall AVERAGE ranking on Brookfield Real Estate Financial Partners LLC (BREF) as a commercial mortgage special servicer. As part of the ranking action, we lowered our management and organization subranking to AVERAGE from ABOVE AVERAGE, and we affirmed our AVERAGE loan administration subranking. The outlook is stable.

Our overall AVERAGE ranking reflects our view of BREF's seasoned management, acceptable control environment, and historical track record of effectively resolving defaulted mortgage loans, particularly those that are more complex. The ranking also reflects the company's effective technology systems, institutional backing from Brookfield Asset Management, and well-documented policies and procedures.

BREF is not appointed as a special servicer on any loans or deals as of June 30, 2016, and has not handled a special servicing assignment in several years. While BREF has historically demonstrated its capabilities to resolve distressed mortgage loans in a timely, effective manner, it does not have a current strategy to obtain new assignments. Further, while the company has a highly seasoned staff, its training program remains more consistent with an AVERAGE ranked special servicer. In light of the preceding factors, we have lowered the management and organization subranking to AVERAGE from ABOVE AVERAGE, while maintaining the overall ranking as AVERAGE. Nonetheless, given the depth of BREF's personnel available to manage distressed real estate assets, we believe the company has significant capability to handle new assignments, particularly larger, complex loans should the opportunity arise.

Since our prior review, BREF has made these key changes:Added in-house legal counsel with 20 years of industry experience to assist with asset management and loan closing matters. Hired a new controller with 15 years of industry experience to handle accounting and finance functions. Began raising equity capital for its fifth debt investment fund with a target of as much as $3 billion. The outlook on BREF's special servicing ranking is stable. The stable outlook reflects S&P Global Ratings' expectation that, while we do not expect BREF to be an active special servicer in the near term, we believe that BREF will remain capable to serve as a special servicer for commercial mortgage-backed securities investments and/or subordinate debt assignments in the future. We further expect that BREF will maintain the staffing, processes, and technology systems required to administer its portfolio in accordance with generally accepted servicing practices. Its experienced management team and strong real estate platform should enable it to continue to be an effective special servicer, particularly for large loans.