KBRA Affirms All Ratings For AREIT 2023-CRE8
15 Aug 2024 | New York
KBRA affirms all of its outstanding ratings for AREIT 2023-CRE8, a CRE CLO transaction with limited post-closing acquisition ability. The affirmations follow a surveillance review of the transaction, which has exhibited stable collateral performance since securitization.
At the time of this review, the total collateral balance is $571.5 million, which is comprised of 21 first mortgage loans secured by 32 properties, and approximately $145,000 of cash collateral. During the 30-month acquisition period following the closing date, certain principal proceeds can be used to acquire future funded, non-trust pari passu companion participations related to the closing date assets provided the acquisition criteria are satisfied. The transaction also provides the sponsor with the ability to buy out defaulted and credit risk assets and effectuate modifications for up to seven performing loans, subject to certain restrictions and criteria. Since securitization, the transaction has received $16.5 million in principal proceeds from the full payoff of one loan.
As of the July 2024 remittance period, there are no specially serviced or delinquent loans. Additionally, no loans in the pool have been identified as K-LOCs. The transaction's WA KLTV is 124.4%, compared to 123.5% at securitization. The KDSC at Index Cap is 0.91x, in line with securitization. The overcollateralization and interest coverage tests have each been satisfied during each distribution date since issuance.
At securitization, 18 loans (74.8% of the issuance pool balance) had related companion participations representing unfunded future advance obligations, with an aggregate unfunded amount of $74.9 million. In total, there are currently 16 loans (71.3% of the collateral pool balance), with unfunded future advance obligations with an aggregate of $48.1 million unfunded.
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