KBRA Downgrades Seven Ratings and Affirms All Other Ratings for MSBAM 2016-C31
14 Mar 2025 | New York
KBRA downgrades the ratings of seven classes of certificates and affirms all other outstanding ratings for MSBAM 2016-C31, a $776.1 million CMBS conduit transaction. The rating actions follow a surveillance review of the transaction, which has exhibited an increase in estimated losses since KBRA’s last ratings adjustments in March 2021. The transaction, however, has benefited from deleveraging due to principal paydowns and defeasance, particularly at the top of the capital structure.
As of the February 2025 remittance period, there are four specially serviced assets (7.3% of the pool), including one asset (3.9%) that is REO and one asset (0.5%) that is in foreclosure. KBRA identified 13 K-LOCs (34.1%), including the specially serviced assets. The K-LOCs include six top 10 assets (27.9%):
- Vintage Park (3rd largest, 5.2% of the pool balance)
- Harlem USA (4th largest, 5.2%, 23.7% estimated loss severity)
- SpringHill Suites – Seattle (5th largest, 5.1%, 22.6%)
- Simon Premium Outlets (6th largest, 4.6%, 17.1%)
- One Stamford Forum (7th largest, 3.9%, 71.9%, REO)
- International Square (8th largest, 3.9%)
The remaining seven K-LOCs, representing 6.2% of the pool balance, do not have estimated losses.
Excluding the K-LOCs with estimated losses, the transaction’s WA KLTV is 96.4%, compared to 106.0% at KBRA’s last ratings change in March 2021 and 101.7% at securitization. The KDSC is 1.55x, compared to 1.46x at KBRA’s last ratings change and 1.71x at securitization.
Details concerning the classes with rating changes are as follows:
- Class C to A- (sf) from A (sf)
- Class D to BB (sf) from BBB- (sf)
- Class E to CCC (sf) from B (sf)
- Class F to CC (sf) from CCC (sf)
- Class X-D to BB (sf) from BBB- (sf)
- Class X-E to CCC (sf) from B (sf)
- Class X-F to CC (sf) from CCC (sf)
To access ratings and relevant documents, click here.
Click here to view the report.