Exhibit 1

 

 

Ernst & Young LLP

One Manhattan West

New York, NY 10001

  

Tel: +1 212 773 3000

ey.com

 

Report of Independent Accountants on Applying Agreed-Upon Procedures

 

Banc of America Merrill Lynch Large Loan, Inc. (the “Depositor”)

Bank of America, N.A.

BofA Securities, Inc.

(collectively, the “Specified Parties”)

 

Re:SPG Trust 2026-PGM (the “Issuing Entity”)

Commercial Mortgage Pass-Through Certificates, Series 2026-PGM (the “Certificates”)

 

We have performed the procedures enumerated in Attachment A, which were agreed to and acknowledged as appropriate by the Specified Parties, for the intended purpose of assisting the Specified Parties in evaluating the accuracy of certain information with respect to the Mortgage Loan (as defined herein) contained on the Data Files (as defined herein) (the “Subject Matter”) relating to the Issuing Entity’s securitization transaction as of 18 September 2026. This report may not be suitable for any other purpose. The procedures performed may not address all of the items of interest to a user of the report and may not meet the needs of all users of the report and, as such, users are responsible for determining whether the procedures performed are appropriate for their purposes. The appropriateness of these procedures is solely the responsibility of the Specified Parties identified in this report. No other party acknowledged the appropriateness of the procedures. Consequently, we make no representation regarding the appropriateness of the procedures described in Attachment A, either for the purpose for which this report has been requested or for any other purpose.

 

  
 

Page 2 of 3

 

The procedures performed and our associated findings are included in Attachment A.

 

For the purpose of the procedures described in this report, the Depositor provided us with:

a.Certain electronic data files (the “Data Files”) that are described in Attachment A,
b.Copies of various source documents (the “Source Documents”), which are listed on Exhibit 1 to Attachment A,
c.A list of characteristics on the Data Files (the “Compared Characteristics”), which are listed on Exhibit 2 to Attachment A, that the Depositor instructed us to compare to information contained in the Source Documents,
d.A list of characteristics on the Data Files (the “Recalculated Characteristics”), which are described in Attachment A, that the Depositor instructed us to recalculate using information on the Data Files,
e.A list of characteristics on the Data Files (the “Provided Characteristics”), which are listed on Exhibit 3 to Attachment A, on which the Depositor instructed us to perform no procedures,
f.A draft of the preliminary offering circular for the Issuing Entity’s securitization transaction (the “Draft Preliminary Offering Circular”) and
g.Instructions, assumptions and methodologies, which are described in Attachment A.

 

The procedures included in Attachment A were limited to comparing or recalculating certain information that is further described in Attachment A. The Depositor is responsible for the Subject Matter, Data Files, Source Documents, Compared Characteristics, Recalculated Characteristics, Provided Characteristics, Draft Preliminary Offering Circular and the determination of the instructions, assumptions and methodologies that are described herein. We were not requested to perform, and we have not performed, any procedures other than those listed in Attachment A with respect to the Data Files. We have not verified, and we make no representation as to, the appropriateness, accuracy, completeness or reasonableness of the Source Documents, Provided Characteristics, Draft Preliminary Offering Circular or any other information provided to us by the Depositor upon which we relied in forming our findings. Accordingly, we make no representation and express no opinion or conclusion as to: (a) the existence of the Mortgage Loan, (b) questions of legal or tax interpretation or (c) the appropriateness, accuracy, completeness or reasonableness of any instructions, assumptions and methodologies provided to us by the Depositor that are described in this report. We undertake no responsibility to update this report for events and circumstances occurring after the date hereof.

 

This agreed-upon procedures engagement was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants (the “AICPA”). An agreed-upon procedures engagement involves the practitioner performing specific procedures that the Specified Parties have agreed to and acknowledged to be appropriate for the purpose of the engagement and reporting on findings based on the procedures performed. We were not engaged to, and did not, conduct an examination to express an opinion or a review to express a conclusion in accordance with attestation standards established by the AICPA on any of the items referred to herein. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you.

 

  
 

Page 3 of 3

 

The agreed-upon procedures described in this report were not performed for the purpose of:

a.Satisfying any criteria for due diligence published by a nationally recognized statistical rating organization (a “rating agency”) or
b.Making any findings with respect to:
i.Whether the origination of the Mortgage Loan conformed to, or deviated from, stated underwriting or credit extension guidelines, standards, criteria, or other requirements,
ii.The value of the collateral securing the Mortgage Loan,
iii.Whether the originator(s) of the Mortgage Loan complied with federal, state or local laws or regulations or
iv.Any other factor or characteristic of the Mortgage Loan that would be material to the likelihood that the issuer of the Certificates will pay interest and principal in accordance with applicable terms and conditions.

 

We are required to be independent of the Depositor and to meet our other ethical responsibilities, as applicable for agreed-upon procedures engagements set forth in the Preface: Applicable to All Members and Part 1 – Members in Public Practice of the Code of Professional Conduct established by the AICPA. Independence requirements for agreed-upon procedures engagements are less restrictive than independence requirements for audit and other attestation services.

 

This report is intended solely for the information and use of the Specified Parties and is not intended to be, and should not be, used by anyone other than the Specified Parties. It is not intended to be, and should not be, used by any other person or entity, including investors and rating agencies, who are not identified in the report as Specified Parties, but who may have access to this report as required by law or regulation.

 

 

/s/ Ernst & Young LLP

 

 

18 September 2026

  
 

Attachment A
Page 1 of 4

 

Background

 

For the purpose of the procedures described in this report, the Depositor indicated that:

a.The assets of the Issuing Entity will consist primarily of a fixed-rate commercial mortgage loan (the “Mortgage Loan”) and
b.The Mortgage Loan will be secured primarily by a portfolio of commercial properties (each, a “Property” and collectively, the “Properties”).

 

Procedures performed and our associated findings

 

1.The Depositor provided us with:
a.An electronic data file (the “Preliminary Data File”) that the Depositor indicated contains information relating to the Mortgage Loan and Properties that is expected to be as of 1 October 2026 (the “Reference Date”) and
b.Record layout and decode information relating to the information on the Preliminary Data File.

 

Using the information in the Source Documents, we compared the Compared Characteristics listed on Exhibit 2 to Attachment A, as shown on the Preliminary Data File, to the corresponding information in the Source Documents indicated on Exhibit 2 to Attachment A, subject to the instructions, assumptions and methodologies stated in the notes on Exhibit 2 to Attachment A. If more than one Source Document is listed for a Compared Characteristic, the Depositor instructed us to note agreement if the value on the Preliminary Data File for the Compared Characteristic agreed with the corresponding information in at least one of the Source Documents listed for such Compared Characteristic on Exhibit 2 to Attachment A (except as described in the notes on Exhibit 2 to Attachment A). We performed no procedures to reconcile any differences that may exist between various Source Documents for any of the Compared Characteristics listed on Exhibit 2 to Attachment A.

 

We performed certain procedures on earlier versions of the Data Files and communicated differences prior to being provided the Data Files which were subjected to the procedures as described herein.

 

2.As instructed by the Depositor, we adjusted the information on the Preliminary Data File to correct all the differences we noted in performing the procedures described in the Item above and provided a list of such differences to the Depositor. The Preliminary Data File, as so adjusted, is hereinafter referred to as the “Updated Data File.”
  
 

Attachment A
Page 2 of 4

 

3.Subsequent to the performance of the procedures described in the Items above, we received from the Depositor:
a.An electronic data file (the “Final Data File,” which together with the Preliminary Data File comprise the Data Files) that the Depositor indicated contains information relating to the Mortgage Loan and Properties as of the Reference Date and
b.Record layout and decode information relating to the information on the Final Data File.

 

Using information on the:

a.Final Data File and
b.Updated Data File,

we compared each Compared Characteristic listed on Exhibit 2 to Attachment A, as shown on the Final Data File, to the corresponding information on the Updated Data File and found such information to be in agreement.

 

4.Using the “First Payment Date,” as shown on the Final Data File, we recalculated the “Seasoning” of the Mortgage Loan as of the Reference Date. We compared this recalculated information to the corresponding information on the Final Data File and found such information to be in agreement.

 

5.Using the:
a.First Payment Date and
b.Maturity Date,

as shown on the Final Data File, we recalculated the “Original Loan Term (mos)” of the Mortgage Loan. We compared this recalculated information to the corresponding information on the Final Data File and found such information to be in agreement.

 

6.Using the:
a.Original Loan Term (mos) and
b.Seasoning,

as shown on the Final Data File, we recalculated the “Remaining Loan Term (mos)” of the Mortgage Loan. We compared this recalculated information to the corresponding information on the Final Data File and found such information to be in agreement.

  
 

Attachment A
Page 3 of 4

 

7.The applicable Source Document(s) indicate that the Mortgage Loan is interest-only for its entire term. Based on this information, the Depositor instructed us to:
a.Use “0” for the:
i.Original amortization term of the Mortgage Loan (the “Original Amortization Term (mos)”) and
ii.Remaining amortization term of Mortgage Loan (the “Remaining Amortization Term (mos)”),
b.Use the “Original Loan Term (mos),” as shown on the Final Data File, for the “Original IO Term (mos)” of the Mortgage Loan and
c.Use the “Mortgage Loan Original Balance,” as shown on the Final Data File, for the:
i.Principal balance of the Mortgage Loan and each Property as of the Reference Date (the “Mortgage Loan Cut-off Date Balance”) and
ii.Principal balance of the Mortgage Loan and each Property as of the “Maturity Date” of the Mortgage Loan (the “Mortgage Loan Maturity Balance”).

 

We compared this information to the corresponding information on the Final Data File and found such information to be in agreement.

 

8.Using the:
a.Original IO Term (mos) and
b.Seasoning,

as shown on the Final Data File, we recalculated the “Remaining IO Term (mos)” of the Mortgage Loan. We compared this recalculated information to the corresponding information on the Final Data File and found such information to be in agreement.

 

9.Using the:
a.Mortgage Loan Original Balance,
b.Interest Rate and
c.Interest Accrual Method,

as shown on the Final Data File, and the calculation methodologies provided by the Depositor described in the succeeding paragraph(s) of this Item, we recalculated the:

i.Monthly IO Payment and
ii.Annual IO Debt Service

of the Mortgage Loan. We compared this recalculated information to the corresponding information on the Final Data File and found such information to be in agreement.

 

For the purpose of this procedure, the Depositor instructed us to recalculate the “Monthly IO Payment” of the Mortgage Loan as 1/12th of the product, rounded to two decimal places, of:

a.The “Mortgage Loan Original Balance,” as shown on the Final Data File,
b.The “Interest Rate,” as shown on the Final Data File, and
c.365/360.

 

For the purpose of this procedure, the Depositor instructed us to recalculate the “Annual IO Debt Service” of the Mortgage Loan as twelve (12) times the “Monthly IO Payment,” as shown on the Final Data File.

 

  
 

Attachment A
Page 4 of 4

 

10.Using the:
a.Mortgage Loan Cut-off Date Balance,
b.Mortgage Loan Maturity Balance,
c.Appraisal Value,
d.Annual IO Debt Service,
e.Underwritten NOI,
f.Underwritten NCF and
g.Total Units,

as shown on the Final Data File, and the applicable calculation methodologies and assumptions described in the Draft Preliminary Offering Circular, we recalculated the:

i.Mortgage Loan Per Unit,
ii.Appraised Value Per Unit,
iii.Cut-off Date LTV,
iv.Maturity Date LTV,
v.UW NOI Debt Yield,
vi.UW NCF Debt Yield,
vii.UW NOI DSCR and
viii.UW NCF DSCR

of the Mortgage Loan, and with respect to ii. above, of each Property. We compared this recalculated information to the corresponding information on the Final Data File and found such information to be in agreement.

 

For the purpose of this procedure, the Depositor instructed us to:

a.Round the characteristics listed in iii. through vi. above to the nearest 1/10th of one percent and
b.Round the characteristics listed in i., vii. and viii. above to two decimal places.

 

11.Using the:
a.Total Units,
b.Largest Tenant 1 Sq. Ft.,
c.Largest Tenant 2 Sq. Ft.,
d.Largest Tenant 3 Sq. Ft.,
e.Largest Tenant 4 Sq. Ft. and
f.Largest Tenant 5 Sq. Ft.,

as shown on the Final Data File, we recalculated the:

i.Largest Tenant 1 % of Total SF,
ii.Largest Tenant 2 % of Total SF,
iii.Largest Tenant 3 % of Total SF,
iv.Largest Tenant 4 % of Total SF and
v.Largest Tenant 5 % of Total SF

of each Property. We compared this recalculated information to the corresponding information on the Final Data File and found such information to be in agreement.

 

12.Using the:
a.Interest Rate and
b.Administrative Fee Rate,

as shown on the Final Data File, we recalculated the “Net Interest Rate” of the Mortgage Loan. We compared this recalculated information to the corresponding information on the Final Data File and found such information to be in agreement.

  
 

Exhibit 1 to Attachment A
Page 1 of 2 

 

Source Documents

 

Mortgage Loan Source Documents

 

Source Document Title Source Document Date
   
Promissory Note (see Note 1) 18 September 2026
   
Loan Agreement (see Note 1) 18 September 2026
   
Deposit Account Control Agreements (see Note 1) 14 September 2026
   
Guaranty Agreement (see Note 1) 14 September 2026
   
Reserve Guaranty Agreements (see Note 1) 14 September 2026
   
Second Amended and Restated Limited Liability Company Agreements (see Note 1) 14 September 2026
   
Non-Consolidation Opinion (see Note 1) 14 September 2026
   
Assignment of Management Agreement (see Note 1) 18 September 2026
   
Interest Rate and Admin Fee Schedule Not Dated
   
Allocated Loan Amount Schedule (see Note 1) 16 September 2026

 

Property Source Documents

 

Source Document Title Source Document Date
   
Appraisal Reports Various
   
Engineering Reports 13 August 2026
   
Phase I Environmental Reports 3 September 2026
   
Underwriter’s Summary Report Not Dated
   
Underwritten Rent Rolls 1 September 2026
   
Pro Forma Title Policies Not Dated
   
Property Management Agreements Various
   
First Amendment to the Gurnee Mills Property Management Agreement 27 September 2016

 

  
 

Exhibit 1 to Attachment A
Page 2 of 2 

Property Source Documents (continued)

 

Source Document Title Source Document Date
   
Insurance Review File 16 September 2026
   
Insurance Certificates Various
   
Potomac Mills Regional Economic Snapshot March 2025
   
U.S. Census Information Not Dated
   
Green Street Retail Property Market Data 11 September 2026
   
Green Street Property Reports Not Dated
   
Tenant Lease Documents Various
   
Capital Expenditures Summary Various
   
Historical Sales Information Various
   
Placer.ai Property Insights Various
   
Foot Traffic Information Not Dated
   
Zoning Reports Various
   
Trepp Property Reports Not Dated
   
Historical Occupancy Files Not Dated
   
Assignment and Assumption of Gurnee Mills Property Management Agreement 20 June 2007

 

Note:

 

1.The indicated provided Source Document(s) are draft document(s) with the Source Document Date reflecting the latest date of receipt. For the purpose of the procedures described in this report, the Depositor instructed us to treat the indicated Source Document(s) as fully executed.

 

  
 

Exhibit 2 to Attachment A
Page 1 of 5 

Compared Characteristics and Source Documents

 

Property Information:

 

Characteristic Source Document(s)
   
Street Address Appraisal Report
City Appraisal Report
State Appraisal Report
County Appraisal Report
Zip Code Appraisal Report
Property Type Appraisal Report
Property SubType Appraisal Report
Year Built Appraisal Report
Most Recent Renovation Appraisal Report
Total Units Underwritten Rent Roll
Unit Type Underwritten Rent Roll
Occupancy Rate Underwritten Rent Roll
Occupancy As of Date Underwritten Rent Roll

 

Third Party Information:

 

Characteristic Source Document(s)
   
Appraisal Date Appraisal Report
Appraisal Value Appraisal Report
Engineering Report Date Engineering Report
Environmental Phase I Report Date Phase I Environmental Report

 

Major Tenant Information:

 

Characteristic Source Document(s)
   
Largest Tenant 1 Underwritten Rent Roll
Largest Tenant 1 Sq. Ft. Underwritten Rent Roll
Largest Tenant 1 Expiration Underwritten Rent Roll
Largest Tenant 2 Underwritten Rent Roll
Largest Tenant 2 Sq. Ft. Underwritten Rent Roll
Largest Tenant 2 Expiration Underwritten Rent Roll
Largest Tenant 3 Underwritten Rent Roll
Largest Tenant 3 Sq. Ft. Underwritten Rent Roll
Largest Tenant 3 Expiration Underwritten Rent Roll
  
 

Exhibit 2 to Attachment A
Page 2 of 5 

 

Major Tenant Information: (continued)

 

Characteristic Source Document(s)
   
Largest Tenant 4 Underwritten Rent Roll
Largest Tenant 4 Sq. Ft. Underwritten Rent Roll
Largest Tenant 4 Expiration Underwritten Rent Roll
Largest Tenant 5 Underwritten Rent Roll
Largest Tenant 5 Sq. Ft. Underwritten Rent Roll
Largest Tenant 5 Expiration Underwritten Rent Roll

 

Underwriting Information:

 

Characteristic Source Document(s)
   
Third Most Recent Date Underwriter’s Summary Report
Third Most Recent Revenue Underwriter’s Summary Report
Third Most Recent Expenses Underwriter’s Summary Report
Third Most Recent NOI Underwriter’s Summary Report
Third Most Recent NCF Underwriter’s Summary Report
Second Most Recent Date Underwriter’s Summary Report
Second Most Recent Revenue Underwriter’s Summary Report
Second Most Recent Expenses Underwriter’s Summary Report
Second Most Recent NOI Underwriter’s Summary Report
Second Most Recent NCF Underwriter’s Summary Report
Most Recent Date Underwriter’s Summary Report
Most Recent Description Underwriter’s Summary Report
Most Recent Revenue Underwriter’s Summary Report
Most Recent Expenses Underwriter’s Summary Report
Most Recent NOI Underwriter’s Summary Report
Most Recent NCF Underwriter’s Summary Report
Underwritten Revenue Underwriter’s Summary Report
Underwritten Expenses Underwriter’s Summary Report
Underwritten NOI Underwriter’s Summary Report
Underwritten Capital Items Underwriter’s Summary Report
Underwritten NCF Underwriter’s Summary Report

 

  
 

Exhibit 2 to Attachment A
Page 3 of 5 

 

Reserve and Escrow Information:

 

Characteristic Source Document(s)
   
Real Estate Tax Escrow - Initial Loan Agreement
Real Estate Tax Monthly Escrow Loan Agreement
Insurance Escrow - Initial Loan Agreement
Insurance Monthly Escrow Loan Agreement
Replacement Reserve Escrow - Initial Loan Agreement
Replacement Reserve Monthly Escrow Loan Agreement
Immediate Repairs Escrow - Initial Loan Agreement
Immediate Repairs Monthly Escrow Loan Agreement
TI /LC Escrow - Initial Loan Agreement
TI/LC Monthly Escrow Loan Agreement
Other Escrow 1 Description Loan Agreement and Reserve Guaranty Agreements
Other Escrow 1 Initial Loan Agreement and Reserve Guaranty Agreements
Other Escrow 1 Monthly Loan Agreement
Other Escrow 2 Description Loan Agreement and Reserve Guaranty Agreements
Other Escrow 2 Initial Loan Agreement and Reserve Guaranty Agreements
Other Escrow 2 Monthly Loan Agreement

 

Mortgage Loan Information:

 

Characteristic Source Document(s)
   
Borrower Name Loan Agreement
Interest Rate Interest Rate and Admin Fee Schedule
Administrative Fee Rate Interest Rate and Admin Fee Schedule
Mortgage Loan Original Balance Loan Agreement or Allocated Loan Amount Schedule
First Payment Date Loan Agreement
Maturity Date Loan Agreement
Payment Day of Month Loan Agreement
Payment Grace Period Event of Default Loan Agreement
Payment Grace Period Event of Late Fee Loan Agreement
Balloon Grace Period Event of Default Loan Agreement
Balloon Grace Period Event of Late Fee Loan Agreement
Amortization Type Loan Agreement
Interest Accrual Method Loan Agreement
Prepay Description Loan Agreement
Partially Prepayable without Penalty (Y/N) Loan Agreement
Partially Prepayable without Penalty Description Loan Agreement
Partial Collateral Release (Y/N) Loan Agreement
Partial Collateral Release Description Loan Agreement
Substitution Allowed (Y/N) Loan Agreement
  
 

Exhibit 2 to Attachment A
Page 4 of 5 

Mortgage Loan Information: (continued)

 

Characteristic Source Document(s)
   
Lockbox Loan Agreement
Cash Management Loan Agreement
Cash Flow Sweep Trigger Loan Agreement
Carve-Out Guarantor(s) Guaranty Agreement
Future Additional Debt Permitted (Y/N) Loan Agreement
Single Purpose Entity Loan Agreement
Non-Consolidation Letter Non-Consolidation Opinion
Independent Director Loan Agreement
Title Type Pro Forma Title Policy
Mezzanine Debt In Place Loan Agreement

 

Notes:

 

1.For the purpose of comparing the:
a.Street Address,
b.City and
c.State

characteristics, the Depositor instructed us to ignore differences that are due to standard postal abbreviations.

 

2.For the purpose of comparing the “Underwriting Information” characteristics that are expressed as dollar values, the Depositor instructed us to ignore differences of +/- $1 or less.

 

3.For the purpose of comparing the “Balloon Grace Period Event of Late Fee” characteristic, the Depositor instructed us to use the “Payment Grace Period Event of Late Fee,” as shown in the applicable Source Document(s), as the applicable Source Document(s) did not specify a grace period for the payment due on the “Maturity Date.”

 

4.For the purpose of comparing the “Prepay Description” characteristic, the Depositor instructed us to assume that the entire “Loan” (as described in the applicable Source Document(s)) has been securitized.

 

5.For the purpose of comparing the “Prepay Description” characteristic, the Depositor instructed us to assume that the “startup day” of the REMIC Trust (as described in the applicable Source Document(s)) is 10/20/2026.

 

  
 

Exhibit 2 to Attachment A
Page 5 of 5 

 

6.For the purpose of comparing the “Prepay Description” characteristic, the Depositor instructed us to ignore any permitted partial release events or partial prepayments to cure certain trigger periods, as described in the applicable Source Document(s).

 

7.For the purpose of comparing the “Lockbox” characteristic, the Depositor instructed us to use “Hard” if the applicable Source Document(s) require the borrower(s) or manager(s) to direct tenants to pay rents directly to a lockbox account controlled by the lender(s).

 

8.For the purpose of comparing the “Cash Management” characteristic, the Depositor instructed us to use “Springing” if:
a.Prior to the occurrence of an event of default or one or more specified trigger events described in the applicable Source Document(s), funds in the lockbox are forwarded to an account controlled by the borrower(s) or otherwise made available to the borrower(s) and
b.Upon the occurrence of an event of default or one or more specified trigger events described in the applicable Source Document(s), funds in the lockbox are forwarded to a cash management account controlled by the lender(s), and the funds are disbursed according to the applicable Source Document(s).

 

We performed no procedures to determine the appropriateness, accuracy, completeness or reasonableness of the instructions, assumptions and methodologies provided by the Depositor that are described in the notes above.

  
 

Exhibit 3 to Attachment A
 

 

Provided Characteristics

 

Characteristic
 
Property Name
Loan Purpose

 

Note:We performed no procedures to determine the appropriateness, accuracy, completeness or reasonableness of the Provided Characteristics.