KBRA Downgrades Five Ratings and Removes Them From Watch for COMM 2014-UBS3

KBRA downgrades the ratings of five classes of certificates and affirms all other outstanding ratings for COMM 2014-UBS3, a $605.1 million CMBS conduit transaction. Simultaneously, five classes have been removed from Watch Downgrade (DN), where they were placed on December 20, 2023. The rating actions follow a surveillance review of the transaction, which has which has had a meaningful increase in KBRA's estimated losses on three K-LOC loans (23.8%) since our last surveillance review. The rating actions also consider the deleveraging of the transaction from loan payoffs, amortization and defeasance as well as the near-term maturities of the remaining loans.

As of the March 2024 remittance period, there are four specially serviced assets (36.2%), of which one is REO (7.5%) and one (0.5%) is 90+ days delinquent.

KBRA identified seven K-LOCs (53.6%), four of which (24.3%) have estimated losses. This includes:

Six of the top 10 assets (53.1%):

One other K-LOC has an estimated loss:

Excluding the K-LOCs with estimated losses, the transaction’s WA KLTV is 103.6%, compared to 99.9% at KBRA's last ratings change and 106.1% at securitization. The KDSC is 1.48x, compared to 1.52x at KBRA's last ratings change and 1.50x at securitization.

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