KBRA Assigns Preliminary Ratings to WFCM 2024-5C1
July 08 2024 - 12:50PM
Business Wire
KBRA is pleased to announce the assignment of preliminary
ratings to 14 classes of WFCM 2024-5C1, a $731.9 million CMBS
conduit transaction collateralized by 32 commercial mortgage loans
secured by 48 properties.
The collateral properties are located throughout 25 MSAs, of
which the three largest are New York (19.2%), Houston (18.8%), and
Los Angeles (9.3%). The pool has exposure to all major property
types, with three types representing more than 10.0% of the pool
balance: multifamily (44.2%), office (21.0%), and mixed-use
(15.2%). The loans have principal balances ranging from $3.2
million to $73.0 million for the largest loan in the pool, 9950
Woodloch (10.0%), a 601,151 sf, Class-A, LEED Silver certified
suburban office building located in The Woodlands, Texas,
approximately 30 miles north of the Houston CBD. The five largest
loans, which also include Falls Houston Multifamily Portfolio
(8.8%), 640 5th Avenue (6.9%), Lotus 315 & Essence 144 (6.8%),
and The Archive Apartments (6.5%), represent 39.0% of the initial
pool balance, while the top 10 loans represent 61.8%.
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 North
American CMBS Property Evaluation Methodology. On an aggregate
basis, KNCF was 9.5% less than the issuer cash flow. KBRA
capitalization rates were applied to each asset’s KNCF to derive
values that were, on an aggregate basis, 36.2% less than third
party appraisal values. The pool has an in-trust KLTV of 91.6% and
an all-in KLTV of 93.4%. The model deploys rent and occupancy
stresses, probability of default regressions, and loss given
default calculations to determine losses for each collateral loan
that are then used to assign our credit ratings.
To access rating and relevant documents, click here.
Click here to view the report.
Methodologies
- CMBS: Methodology for Rating Interest-Only Certificates in CMBS
Transactions
- CMBS: North American CMBS Property Evaluation Methodology
- CMBS: North American CMBS Multi-Borrower 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: 1005018
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version on businesswire.com: https://www.businesswire.com/news/home/20240708341993/en/
Analytical
Samuel Stuart, Director (Lead Analyst) +1 646-731-1298
samuel.stuart@kbra.com
James Wang, Managing Director +1 646-731-2450
james.wang@kbra.com
Nitin Bhasin, Senior Managing Director, Global Head of CMBS
(Rating Committee Chair) +1 646-731-2334 nitin.bhasin@kbra.com
Business Development
Daniel Stallone, Managing Director +1 646-731-1308
daniel.stallone@kbra.com