NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) is pleased to announce the assignment of preliminary ratings for the COMM 2013-CCRE8 transaction (see ratings list below). COMM 2013-CCRE8 is a $1.4 billion CMBS conduit transaction collateralized by 59 commercial mortgage loans that are secured by 94 properties.
The loans have principal balances ranging from $2.2 million to $209.0 million for the largest loan in the pool, which is secured by 375 Park Avenue (15.1%), an 830,928 sf, Class-A office tower located in New York City. The top five loans, which also include Moffett Towers Phase II (8.3%), 175 Park Avenue (5.4%), Westin San Diego (5.1%), and 1460 North Halsted (4.5%), represent 38.4% of the initial pool balance, while the top 10 loans represent 57.5%. Three loans, 375 Park Avenue (15.1%), Moffett Towers Phase II (8.3%), and The Paramount Building (4.0%), were originated with split loan structures whereby the mortgaged property securing the loans also secures a pari passu companion loan. With respect to 375 Park Avenue, a $782.8 million mortgage loan was split into senior and subordinate components, of which a $209.0 million senior component will be contributed to this transaction while a $209.0 million senior and a $364.8 million subordinate component were contributed to CGCMT 2013-375P, a single borrower transaction that was also rated by Kroll Bond Ratings.
The mortgaged properties are located in 25 different states and the District of Columbia. New York (26.6%) and California (25.9%) are the only states that represent more than 10.0% of the pool balance. The pool has exposure to all the major property type sectors. Office (37.4%) is the only property type exposure that exceeds 20.0% of the pool.
KBRA’s analysis of the transaction incorporated our multi-borrower rating process that begins with our analysts' evaluation of the underlying collateral properties' financial and operating performance, which determine KBRA’s estimate of sustainable net cash flow (KNCF) and KBRA value using our CMBS Property Evaluation Guidelines. KNCF was, on an aggregate basis, 8.2% less than the issuer cash flow. KBRA capitalization rates were applied to each asset’s KNCF to derive individual property values that, on an aggregate basis, were 37.5% lower than third party appraisal values. The weighted average capitalization rate for the transaction was 8.9%. The pool has an in-trust KLTV of 93.9% and an all-in KLTV of 111.6%. The weighted average in-trust KLTV is skewed by two trust assets that have extremely low KLTVs, which include 375 Park Ave (15.1% of the pool, KLTV of 49.0%) and The Paramount Building (4.0% of the pool, KLTV of 49.4%). Excluding these loans, the pool’s in-trust KLTV is 104.4%.
The KBRA credit model deploys rent and occupancy stresses, probability of default regressions, and loss given default calculations to determine losses for each collateral loan, which are then used to assign our credit ratings.
For complete details on the analysis, please see our presale report, COMM 2013-CCRE8 published today at www.krollbondratings.com.
The preliminary ratings are based on information known to KBRA at the time of this publication. Information received subsequent to this release could result in the assignment of final ratings that differ from the preliminary ratings.
Preliminary Ratings Assigned: COMM 2013-CCRE8
| Class | Initial Class Balance | Expected KBRA Ratings | ||||||
| A-1 | $80,720,000 | AAA(sf) | ||||||
| A-2 | $102,691,000 | AAA(sf) | ||||||
| A-3 | $23,844,000 | AAA(sf) | ||||||
| A-4 | $250,000,000 | AAA(sf) | ||||||
| A-5 | $407,995,000 | AAA(sf) | ||||||
| A-SBFL | $104,000,000 | AAA(sf) | ||||||
| X-A | $1,126,754,000 | AAA(sf) | ||||||
| X-B | $81,347,000 | AAA(sf) | ||||||
| X-C | $176,543,049 | NR | ||||||
| A-M | $157,504,000 | AAA(sf) | ||||||
| B | $81,347,000 | AA-(sf) | ||||||
| C | $41,540,000 | A-(sf) | ||||||
| D | $46,731,000 | BBB-(sf) | ||||||
| E | $22,501,000 | BB(sf) | ||||||
| F | $24,231,000 | B(sf) | ||||||
| G | $41,540,049 | NR | ||||||
17g-7 Disclosure
All Nationally Recognized Statistical Rating Organizations are required, pursuant to SEC Rule 17g-7, to provide a description of a transaction’s representations, warranties and enforcement mechanisms that are available to investors when issuing credit ratings. KBRA’s disclosure for this transaction can be found in the report entitled CMBS: COMM 2013-CCRE8 17g-7 Disclosure Report.
Related publications (available at www.krollbondratings.com):
CMBS:
U.S. CMBS Multi-Borrower Rating Methodology, published February 23, 2012
CMBS
Property Evaluation Guidelines, published June 10, 2011
About Kroll Bond Rating Agency
Kroll Bond Rating Agency is registered with the SEC as a nationally recognized statistical rating organization (NRSRO). Kroll Bond Rating Agency was established in 2010 to restore trust in credit ratings by establishing new standards for assessing risk and by offering accurate, clear, and transparent ratings.
