Press Release|CMBS

KBRA Affirms All Ratings for AREIT 2020-CRE4

10 Apr 2024   |   New York


KBRA affirms all of its outstanding ratings for AREIT 2020-CRE4, a $206.8 million CRE CLO transaction with limited post-closing acquisition ability. The affirmations follow a surveillance review of the transaction, which has exhibited a worsening in overall pool performance compared to last review including a relatively high concentration of assets that have been identified as K-LOCs. However, this risk is offset by the transaction’s increased note subordination levels, primarily as a result of the full payoff of 20 loans ($423.6 million, 69.7% of the issuance collateral balance) since securitization.

At the time of this review, the total collateral balance is $206.8 million, which is comprised of six first mortgage loans secured by 10 properties. There was a 24-month acquisition period following the closing date, where certain principal proceeds could be used to acquire funded, non-trust pari passu companion participations related to the closing date assets provided the acquisition criteria were satisfied. The acquisition period ended with the June 2022 payment date.

As of the March 2024 remittance period two loans (28.0%) were reported to be matured non-performing. KBRA identified five (90.4%) of the remaining loans as K-LOCs, including the matured non-performing assets. The K-LOCs include:

  • 150 Post Street (largest, 34.7% of the pool balance, 50.6% loss severity)
  • Wells Fargo Center – Jacksonville (2nd largest, 19.0%, 44.7%)
  • VBH Austin Portfolio (3rd largest, 16.3%)
  • Voorhees & Antiques Mall Buildings (4th largest, 11.4%, 24.6%)
  • 4040 NCX (6th largest, 9.0%, 46.6%)

The securitization includes an OC test, which has been satisfied during each remittance date since closing. At securitization, the majority of the loans (21 loans, 81.8% of the issuance pool balance) had related companion participations representing unfunded future advance obligations, with an aggregate unfunded amount of $114.5 million. At present, only the 150 Post Street loan (34.7% of the current loan collateral balance) has an unfunded future advance obligation totaling $4.9 million as of March 2024.

To access rating and relevant documents, click here.

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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

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: 1003866

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