KBRA Releases Monthly CMBS Trend Watch
NEW YORK--(BUSINESS WIRE)--May 7, 2019--Kroll Bond Rating Agency (KBRA) releases April’s CMBS Trend Watch.
CMBS private label pricing volume fell in April to $3.1 billion from $7.2 billion in March, bringing the year-to-date issuance total to $19.6 billion. On a year-over-year basis, volume is off 16.5% from 2018. The forward pipeline indicates that May CMBS volume could increase with the launch of as many as six conduits and between five and seven single-borrower deals. In addition, we expect to see two Freddie K-series transactions and upward of six commercial real estate collateralized loan obligations.
In April, KBRA published pre-sales for four deals ($3.3 billion), including two conduits ($1.6 billion), one single borrower ($310.5 million), and one agency transaction ($1.4 billion).
April’s surveillance activity includes a review of 310 rated classes, consisting of 271 affirmations, 35 upgrades, and four downgrades. The activity includes 63 classes from eight Velocity Commercial Capital small balance transactions. KBRA also highlighted 76 KBRA Loans of Concern as well as 10 KBRA Performance Outlook changes, including seven to Underperform from Perform, and three to Outperform from Perform.
KBRA also issued other notable releases in April, including the transfer of One Stamford Forum ($103.8 million principal balance) and 600 Broadway ($120 million) to special servicing. One Stamford Forum is Purdue Pharma’s company headquarters. Several media reports indicated that Purdue may be preparing a bankruptcy filing in an attempt to mitigate its potential liability from numerous lawsuits alleging the company’s role in the opioid epidemic. 600 Broadway was transferred to the special servicer when the borrower failed to fund a go dark reserve for tenants Gilly Hicks and A&F.
April’s three-month rolling average IO Index dropped to 62.1% from 64.1% in March, after five consecutive monthly increases.
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KBRA is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. 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, and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.
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SOURCE: Kroll Bond Rating Agency
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PUB: 05/07/2019 09:55 AM/DISC: 05/07/2019 09:55 AM