Press Release|CMBS
View PDF

KBRA Downgrades Two Ratings, Withdraws One Rating, and Affirms All Other Ratings for JPMBB 2014-C23

5 Sep 2025   |   New York

Contacts

KBRA downgrades the ratings of two classes, withdraws one rating, and affirms all other outstanding ratings for JPMBB 2014-C23, a $334.5 million CMBS conduit transaction. The rating actions follow a surveillance review of the transaction and are based on the performance and expected recovery of the transaction's seven remaining assets. Of these, five (85.4% of the pool balance) were identified as K-LOCs, including two assets (46.2%) that are performing matured, one asset (29.0%) that is 30+ days delinquent, and two (10.2%) that are in foreclosure. The details of all remaining assets are outlined below.

17 State Street (largest, 32.6%, K-LOC, Specially Serviced)

  • The loan is collateralized by a 42-story, 560,210 sf, Class-A office building located in downtown Manhattan. The property was developed on a 0.5-acre site in 1988 and was acquired by the sponsor in 1999.
  • KBRA maintains the loan's K-LOC designation and KPO of Underperform due to its status with the special servicer. The loan transferred to the special servicer in August 2024 because the borrower did not repay the loan at its maturity date. An extension agreement was executed in January 2025, which extended the loan's maturity to January 2027, with an option to extend for an additional year to January 2028, contingent on property performance. Based on the May 2025 rent roll, the property is 68.5% leased, compared to 92.6% at last review and 90.7% at securitization. The decline since last review is due to the prior largest tenant, IPsoft, executing an amendment in their lease to downsize by 111,300 sf (19.9% of total sf). Lease rollover through 2026 represents 24.9% of base rent and is spread across 20 tenants, the largest of which represents 3.5% of base rent.
  • The servicer reported occupancies and DSCs are: N/A / 1.91x (YTD March 2025); 93.0% / 2.17x (YTD September 2024); at closing these were 91.1% / 1.79x. An appraisal dated December 2024 valued the property at $215.0 million ($384 per sf), which is 33.8% lower than the $325.0 million ($580 per sf) appraised value at issuance. As of August 2025, the loan is current on payments. However, in the event of a default, KBRA estimates that it could experience a loss given default of $32.8 million (18.2% estimated loss severity) on the whole loan balance of $180.0 million. The loss is based on a KBRA liquidation value of $149.8 million ($267 per sf). The value is derived from a direct capitalization approach using a KNCF of $13.4 million and a capitalization rate of 8.50%, as well as a deduction of $7.7 million to account for lease up costs.

Columbus Square Portfolio (2nd largest, 29.0%, K-LOC, 30+ Days Delinquent)

  • The loan is collateralized by five condominium buildings that contain retail, community facility and parking garage space located on the Upper West Side of New York City. The collateral contains a total of 494,224 sf within 31 commercial condominium units and consists of 19.9% of ground floor retail space, 36.0% of lower-level retail space, 22.2% of community facility space, and 21.9% of leased parking garage space at three different locations with a total capacity for 392 vehicles.
  • KBRA maintains the loan's K-LOC designation and KPO of Underperform due to the loan's prior status with the special servicer and a recent loan modification. The loan transferred to the special servicer in December 2023 due to imminent maturity default. It returned to the master servicer in July 2024 following a modification that closed in March 2024, which extended the loan's term by three years to August 2027. As of the August 2025 remittance, the loan is reported as 30+ days delinquent. According to the March 2025 rent roll, the collateral was 97.9% leased, compared to 99.2% at last review and 95.7% at issuance. Lease rollover through YE 2025, inclusive of MTM leases, represents 2.1% of base rent. In 2026, two top 10 tenants have scheduled lease expirations: HomeGoods, Inc. (5th largest, 6.0% of base rent, May 2026) and Sephora USA, Inc. (10th largest, 4.4%, January 2026).
  • The servicer reported occupancies and DSCs are: 99.0% / 1.16x (YTD March 2025); 97.0% / 1.18x (FY 2024); at closing these were 95.7% / 1.15x. At this time, KBRA does not estimate a loss on this asset.

Hard Rock San Diego Leased Fee (3rd largest, 14.3%, Perform)

  • The loan is collateralized by the borrower’s leased fee interest in the 1.2 acres of land underlying the Hard Rock Hotel San Diego, a 12-story, 415-key, full-service hotel located in downtown San Diego.
  • KBRA maintains a KPO of Perform on the loan due to stable cash flow performance since issuance. The loan failed to pay off at its ARD in September 2024 and subsequently began amortizing through its final scheduled maturity date in September 2035.
  • The servicer reported occupancies and DSCs are: 100% / 1.46x (YTD March 2025); 100% / 1.46x (FY 2024); at closing these were: 100% / 1.42x.

Beverly Connection (4th largest, 13.6%, K-LOC, Specially Serviced)

  • The loan is collateralized by a 334,566 sf, retail power center located in Los Angeles, California, approximately nine miles west of the CBD. The property is anchored by Target (largest, 22.5% of total base rent), an HQCWT, which has been at the subject since 2012 and operates pursuant to a lease that expires in January 2029. The other major tenants at the property include Ross Dress for Less, Nordstrom Rack, CVS, Saks Fifth Avenue, Marshalls, TJ Maxx and Old Navy.
  • KBRA maintains the loan’s K-LOC designation and KPO of Underperform based its status with the special servicer. The loan transferred to the special servicer in August 2020 due to its delinquency. In September 2023, a reinstatement agreement was executed; however, during the process of returning the loan to the master servicer, the borrower requested a modification to extend the loan's maturity, which was granted at the loan's scheduled August 2024 maturity date. The loan modification closed in April 2025 and extended maturity 23-months to July 2026. As of the August 2025 remittance period, the loan is being prepared for return to the master servicer. Lease rollover through YE 2025, inclusive of MTM leases, represents 12.5% of base rent and 1.7% of collateral sf across 13 leases.
  • The servicer reported occupancies and DSCs are: 92.2% / 1.03x (YTD June 2024); 94.4% / 0.96x (FY 2023); at closing these were 98.5% / 1.51x. An updated appraisal dated December 2024 valued the property at $193.0 million ($577 per sf), which is 25.8% below the $260.0 million ($777 per sf) value at issuance. As a result, the asset carries an ARA of $1.9 million. KBRA’s analysis resulted in an estimated loss of $15.3 million (8.7% estimated loss severity) on the whole loan balance of $175.0 million. The loss is based on a KBRA liquidation value of $164.1 million ($490 per sf), which is equal to 85% of the most recent appraisal.

The three remaining assets account for 10.5% of the pool balance:

  • Memphis Forum (5th largest, 8.4%, Foreclosure) is collateralized by a 342,000 sf, suburban office property located in Memphis, Tennessee, approximately 19 miles southeast of the city's CBD. KBRA maintains the loans K-LOC designation and KPO of Underperform due to its failure to pay off at its scheduled August 2024 maturity date and its subsequent transfer to the special servicer. The borrower has indicated intent to relinquish ownership in the property and is pursuing foreclosure at this time. An updated appraisal dated May 2025 valued the asset at $28.1 million ($82 per sf) which represents a 27.9% decline from issuance. KBRA's analysis resulted in an estimated loss of $11.1 million (40.9% estimated loss severity) on the loan balance of $27.0 million. The loss is based on a value of $17.3 million ($51 per sf) and was derived from a direct capitalization approach using a KNCF of $1.6 million and a capitalization rate of 9.50%, and adjusted to account for a TI/LC reserve of $234,422.
  • Crossroads Center (6th largest, 1.8%, K-LOC, Foreclosure) is collateralized by a 110,575 sf retail property located in Florence, South Carolina, approximately 77 miles east of Columbia. KBRA maintains the loan's K-LOC designation and KPO of Underperform due to its failure to pay off at its scheduled August 2024 maturity date. The special servicer has executed the PNL and is working with the borrower on a potential loan extension. An updated appraisal dated December 2024 valued the asset at $6.0 million ($54 per sf) which represents a 7.8% decline from issuance. KBRA's analysis resulted in an estimated loss of $1.8 million (29.8% estimated loss severity) on the loan balance of $5.9 million. The loss is based on a value of $5.1 million ($34 per sf) and was derived from a direct capitalization approach using a KNCF of $397,055 and a capitalization rate of 9.00%, as well as a deduction of $690,233 to account for lease up costs.
  • U-Haul Self Storage Pool 5 (7th largest, 0.2%, Outperform) is collateralized by the borrower's fee simple interest in a cross-collateralized pool of 21 self-storage properties, totaling 6,587 units. KBRA assigned the loan a KPO of Outperform on the loan due to strong cash flow performance driven by steady rental income. The TTM ended March 2025 servicer NCF was $8.9 million, representing a 128.9% increase from $3.9 million underwritten by the issuer at securitization. The servicer reported occupancies and DSCs are: 87.8% / 4.29x (TTM March 2025); 87.3% / 4.18x (FY 2024); at issuance these were 78.1% / 1.46x.

Details concerning the withdrawn rating are as follows:

  • Class A-5 to WR (sf) from AAA (sf)

Details concerning the classes with ratings changes are as follows:

  • Class E to CCC (sf) from B- (sf)
  • Class F to CC (sf) from CCC (sf)

Details concerning the ratings affirmations are as follows:

  • Class A-S at AAA (sf)
  • Class B at AA (sf)
  • Class C at A (sf)
  • Class EC at A (sf)
  • Class D at BB- (sf)

Rating Sensitivities

Future rating actions will be dependent upon the ongoing assessment of the timing and likelihood of ultimate payment of principal and accrued interest on the rated certificates. The assessment will consider the expected and actual losses on the remaining assets in the transaction, as well as the magnitude and extent of interest shortfalls, if any, on the certificates.

To access ratings and relevant documents, click here.

Related Publication

Methodologies

Disclosures

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 www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA 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 (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

Doc ID: 1011096