Press Release|CMBS

KBRA Affirms All Ratings for JPMCC 2016-NINE

1 May 2024   |   New York


KBRA affirms all of its outstanding ratings for JPMCC 2016-NINE, a CMBS SASB transaction. The affirmations follow a surveillance review of the transaction, which has exhibited a slight worsening in KLTV since last review and securitization. The magnitude of the change, however, does not warrant ratings adjustments at this time. The change is caused in part by KBRA using an as-is analysis to derive KNCF and KBRA value as the property’s in-place occupancy and net cash flow have improved since securitization. At securitization and for all prior reviews we had relied on a stabilized analysis that assumed a higher occupancy rate because the property’s occupancy was well below the market rate. We also increased our capitalization rate used to value the property in this review to reflect changes in demand for office space in the market.

The transaction collateral is an $857.0 million portion of a $1.2 billion non-recourse, first-lien mortgage loan. The whole mortgage loan is represented by six pari passu A notes totaling $1.0 billion and a $186.3 million subordinate B note. The trust collateral includes the $670.7 million senior A-1 note and the subordinate B note.

The loan is collateralized by the borrower’s fee simple and leasehold interests in 9 West 57th Street, a 50-story, 1.7 million sf Class-A office building Midtown Manhattan. The sponsor developed the property in 1972. The ground is leased from an affiliate of the borrower’s sponsor; however, both the fee simple and leasehold interests are pledged as security for the mortgage loan.

KBRA analyzed the cash flow for the property utilizing information from the trustee and servicer to determine KNCF. The property’s occupancy improved to 81.1% from 79.4% at last review and from 63.5% at issuance, and KBRA relied on an as-is analysis for this review. Our analysis generated an as-is KNCF of $119.2 million and a KBRA value of $1.70 billion ($1,014 per sf). We increased our capitalization rate 25 bps to 7.0% in this review. The resulting in-trust KLTV increased to 70.5% from 65.4% at last review and from 62.1% at securitization. KBRA maintains a KPO of Perform on the loan.

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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: 1004120

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