KBRA Assigns Preliminary Ratings to BX 2024-MDHS
April 30 2024 - 5:22PM
Business Wire
KBRA announces the assignment of preliminary ratings to six
classes of BX 2024-MDHS, a CMBS single-borrower securitization.
The collateral for the transaction is a $1.38 billion floating
rate, interest-only mortgage loan. The loan has an initial two-year
term with three, one-year extension options and requires monthly
interest-only payments based on an expected SOFR cap of 5.50%. The
loan is secured by the borrowers’ fee simple interests in 142
primarily industrial assets. In total, the portfolio contains 17.1
million sf and is located in 15 states throughout the US. The top
five state exposures include Georgia (27.9% of allocated loan
amount), Florida (26.1%), Tennessee (8.4%), Texas (8.3%) and North
Carolina (6.5%). As of April 2024, the portfolio was 91.1% leased
to approximately 300 unique tenants, with no individual tenant
accounting for more than 4.9% of total base rent.
KBRA’s analysis of the transaction included a detailed
evaluation of the properties’ cash flows using our U.S. CMBS
Property Evaluation Methodology and the application of our U.S.
CMBS Single Borrower & Large Loan Rating Methodology. In
addition, KBRA also relied on its Global Structured Finance
Counterparty Methodology for assessing counterparty risk in this
transaction and its ESG Global Rating Methodology, to the extent
deemed applicable.
The results of our analysis yielded an as-is KBRA net cash flow
(KNCF) for the portfolio of approximately $90.2 million and a
stabilized KNCF of approximately $101.1 million, which is 8.8% and
8.4% below the issuer’s as-is and stabilized NCFs, respectively,
and a KBRA value of approximately $1.33 billion, which is 34.0% and
35.4% below the appraiser’s aggregate as-is and stabilized values,
respectively. The resulting in-trust KBRA Loan to Value (KLTV) is
104.1%. In our analysis of the transaction, we also reviewed and
considered third party engineering, environmental, and appraisal
reports, the results of our site inspections of 24 (39.4%) of the
portfolio properties, and legal documentation review.
To access rating and relevant documents, click here.
Click here to view the report.
Methodologies
- CMBS: U.S. CMBS Property Evaluation Methodology
- CMBS: U.S. CMBS Single Borrower & Large Loan Rating
Methodology
- Structured Finance: Global Structured Finance Counterparty
Methodology
- ESG Global Rating Methodology
Disclosures
Further information on key credit considerations, sensitivity
analyses that consider what factors can affect these credit ratings
and how they could lead to an upgrade or a downgrade, and ESG
factors (where they are a key driver behind the change to the
credit rating or rating outlook) can be found in the full rating
report referenced above.
A description of all substantially material sources that were
used to prepare the credit rating and information on the
methodology(ies) (inclusive of any material models and sensitivity
analyses of the relevant key rating assumptions, as applicable)
used in determining the credit rating is available in the
Information Disclosure Form(s) located here.
Information on the meaning of each rating category can be
located here.
Further disclosures relating to this rating action are available
in the Information Disclosure Form(s) referenced above. Additional
information regarding KBRA policies, methodologies, rating scales
and disclosures are available at www.kbra.com.
About KBRA
Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit
rating agency registered with the U.S. Securities and Exchange
Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is
registered as a CRA with the European Securities and Markets
Authority. Kroll Bond Rating Agency UK Limited is registered as a
CRA with the UK Financial Conduct Authority. In addition, KBRA is
designated as a designated rating organization by the Ontario
Securities Commission for issuers of asset-backed securities to
file a short form prospectus or shelf prospectus. KBRA is also
recognized by the National Association of Insurance Commissioners
as a Credit Rating Provider.
Doc ID: 1004129
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version on businesswire.com: https://www.businesswire.com/news/home/20240430977017/en/
Analytical Contacts
Elizabeth Yash, Senior Director (Lead Analyst) +1 646-731-3346
elizabeth.yash@kbra.com
Michael McGorty, Senior Director +1 646-731-2393
michael.mcgorty@kbra.com
Nitin Bhasin, Senior Managing Director, Global Head of CMBS
(Rating Committee Chair) +1 646-731-2334 nitin.bhasin@kbra.com
Business Development Contact
Daniel Stallone, Managing Director +1 646-731-1308
daniel.stallone@kbra.com