KBRA Assigns Ratings to BX 2023-XL3
21 Dec 2023 | New York
KBRA announces the assignment of ratings to five classes of BX 2023-XL3, a CMBS single-borrower securitization.
The collateral for the transaction is a $1.0 billion floating rate, interest-only mortgage loan. The loan has an initial two-year term with three, one-year extension options and requires monthly interest-only payments based on SOFR cap of 5.00%. The loan is secured by the borrowers’ fee simple interests in 109 industrial assets. In total, the portfolio contains 8.5 million sf and is located in nine states throughout the US. The top five markets include California (61.9% of allocated loan amount), Texas (13.2%), Tennessee (9.8%), Florida (4.5%) and Oregon (3.9%). As of October 2023, the property was 94.8% leased to over 390 unique tenants.
KBRA’s analysis of the transaction included a detailed evaluation of the properties’ cash flows using our U.S. CMBS Property Evaluation Methodology and the application of our U.S. CMBS Single Borrower & Large Loan Rating Methodology. In addition, KBRA also relied on its Global Structured Finance Counterparty Methodology for assessing counterparty risk in this transaction and its ESG Global Rating Methodology, to the extent deemed applicable.
The results of our analysis yielded a KBRA net cash flow (KNCF) for the property of approximately $73.2 million, which is 9.1% below the issuer’s NCF, and a KBRA value of approximately $998.4 million, which is 35.9% below the appraiser’s aggregate as-is value. The resulting in-trust KBRA Loan to Value (KLTV) is 100.2%. In our analysis of the transaction, we also reviewed and considered third party engineering, environmental, and appraisal reports, the results of our site inspection of the property, and legal documentation review.
To access rating and relevant documents, click here.
Click here to view the report.