KBRA Upgrades Three Ratings and Affirms All Other Ratings for FREMF 2016-K60
22 Mar 2024 | New York
KBRA upgrades the ratings of three classes and affirms all other outstanding ratings of FREMF 2016-K60, a $1.0 billion CMBS multi-borrower transaction. All loans were originated in conjunction with the Federal Home Loan Mortgage Corporation’s (Freddie Mac) K-Deal program. The rating actions follow a surveillance review of the transaction, which has exhibited an improvement in pool performance since KBRA's last ratings change in August 2022. In addition, the rating actions reflect transaction deleveraging from loan defeasances, payoffs, and amortization.
As of the February 2024 remittance period, none of the loans are specially serviced or delinquent; however, KBRA identified four K-LOCs (6.0% of the pool balance). These include:
One top 10 loan (2.4%):
- Hawks Ridge (8th largest, 2.4% of the pool balance, 26.6% estimated loss severity)
Two additional K-LOCs have estimated losses:
- Campus Quarters (1.4%, 20.1%)
- Islander Village (1.0%, 32.5%)
The remaining K-LOC represents 1.3% of the pool balance.
Excluding the K-LOCs with estimated losses, the transaction's WA KLTV is 86.1%, compared to 110.6% at KBRA's last ratings change and 119.5% at securitization. The KDSC is 1.94x, compared to 1.63x at KBRA's last ratings change and 1.64x at securitization.
Details concerning the classes with ratings changes are as follows:
- Class A-M to AAA (sf) from AA+ (sf)
- Class B to AA+ (sf) from A+ (sf)
- Class C to A- (sf) from BBB+ (sf)
To access rating and relevant documents, click here.
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