Kroll Bond Rating Agency (KBRA) is pleased to announce the assignment of preliminary ratings to 18 classes of WFCM 2019-C50 (see ratings list below), a $938.0 million CMBS conduit transaction collateralized by 64 commercial mortgage loans secured by 346 properties.
The collateral properties are located in 32 states, with three states, Ohio (15.4%), California (13.6%), and Texas (11.1%), representing more than 10.0% of the pool balance. The pool has exposure to all the major property types, with the top three being retail (32.3%), office (20.5%), and lodging (18.8%). The loans have principal balances ranging from $3.1 million to $43.5 million for the largest loan in the pool, Crown Center Office Park (4.6%), which is secured by a 341,965 sf, Class-B office complex located in Fort Lauderdale, Florida, approximately six miles northwest of the city’s CBD and 34 miles north of Miami. The five largest loans, which also include Ohio Hotel Portfolio (3.8%), Great Wolf Lodge Southern California (3.7%), Hilton at University Place (3.7%), and Goodyear Portfolio (3.7%), represent 19.6% of the initial pool balance, while the top 10 loans represent 34.7%.
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 U.S. CMBS Property Evaluation Methodology. On an aggregate basis, KNCF was 7.0% less than the issuer’s cash flow. KBRA capitalization rates were applied to each asset’s KNCF to derive values that were, on an aggregate basis, 36.6% less than third party appraisal values. The pool has an in-trust KLTV of 100.4% and an all-in KLTV of 106.3%. 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.
For complete details on the analysis, please see our pre-sale report, WFCM 2019-C50 published at www.kbra.com. The report includes our WFCM 2019-C50 KBRA Conduit Comparative Analytic Tool (KCAT), an easy to use, Excel-based workbook that provides the following information:
- KBRA Deal Tape – Contains KBRA loan level details for every loan in the pool, and the ability for users to input adjustments to KNCF and KBRA Cap Rates and see the related impact on key deal metrics.
- KBRA Credit Metrics Comparison Tool – Enables the user to compare the subject transaction to a user-defined transaction comp set. The feature provides many of the fields that are included in our CMBS Monthly Trend Watch publication.
- Excel-based property cash flow statements for the top 20 loans.
To access ratings, reports and disclosures, click here.
Preliminary Ratings Assigned: WFCM 2019-C50
| Class | Initial Class Balance | Expected KBRA Rating | ||||
| A-1 | $31,064,000 | AAA (sf) | ||||
| A-2 | $71,796,000 | AAA (sf) | ||||
| A-3 | $3,550,000 | AAA (sf) | ||||
| A-SB | $54,377,000 | AAA (sf) | ||||
| A-4 | $110,000,000-$245,000,0001 | AAA (sf) | ||||
| A-5 | $250,788,000-$385,788,0001 | AAA (sf) | ||||
| A-S | $85,589,000 | AAA (sf) | ||||
| B | $39,864,000 | AA (sf) | ||||
| C | $39,863,000 | A (sf) | ||||
| D | $25,794,000 | BBB+ (sf) | ||||
| E | $21,105,000 | BBB- (sf) | ||||
| F | $22,276,000 | BB (sf) | ||||
| G | $9,380,000 | B (sf) | ||||
| H | $37,519,076 | NR | ||||
| X-A | $656,575,0002 | AAA (sf) | ||||
| X-B | $165,316,0002 | AAA (sf) | ||||
| X-D | $46,899,0002 | BBB- (sf) | ||||
| X-F | $22,276,0002 | BB (sf) | ||||
| X-G | $9,380,0002 | B (sf) | ||||
| X-H | $37,519,0762 | NR |
1 The exact initial certificate balances will be determined at final pricing.
2 Notional balance.
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About KBRA and KBRA Europe
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.
View source version on businesswire.com: https://www.businesswire.com/news/home/20190424005642/en/
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