KBRA Downgrades All Ratings for MSC 2021-230P

KBRA downgrades all ratings for MSC 2021-230P, a CMBS SASB transaction. The rating actions follow a surveillance review and reflect the continued deterioration in collateral performance and KBRA value, including the substantial costs required to re-lease the building, as well as the loan’s ongoing foreclosure status with the special servicer. Since the last ratings change in August 2024, collateral occupancy and KNCF have declined, while additional near-term tenant departures are expected to further reduce occupancy to 48.0% by year end. Occupancy reached a high of 82.8% in 2023 and had dropped to 55.7% by YE 2025. The downgrades also consider the resulting increase in leverage and the borrower’s inability to refinance or extend the loan following several forbearance periods.

The transaction collateral is a non-recourse, first lien mortgage loan secured by the borrower’s fee simple interest in a 34-story, 1.4 million sf, Class-A LEED Gold Certified office building. The property, known as the Helmsley Building, is located at 230 Park Avenue between East 45th and East 46th Streets in the Grand Central submarket of New York City’s Manhattan borough. The loan had an initial maturity date of December 9, 2023, and it was not extended. The loan’s sponsors are affiliates of RXR Realty, LLC.

As of the August 2026 reporting, the $670.0 million loan remains in special servicing following its October 2023 transfer for imminent monetary default. There are $26.7 million in outstanding advances for taxes and insurance. According to the servicer, the borrower was granted several forbearance extensions after the initial 2023 maturity, during which it contributed $16.7 million to reserves. The final forbearance expired on April 17, 2026, and the borrower was unable to complete a previously negotiated extension and modification. The borrower subsequently proposed a three-year A/B modification, which was rejected, and foreclosure proceedings continued. More recently, the borrower and special servicer entered into a cooperation agreement to pursue a consensual sale process, and Newmark has been retained to market the property.

KBRA analyzed the cash flow for the property utilizing information from the trustee and servicer to determine KNCF. The property’s occupancy is well below its historical average. Two former top 10 tenants, Duane Morris LLP (previously 4.6% of base rent) and Dentons US LLP (4.2%) vacated at lease expiration in 2026. This followed the departures of Voya Financial (10.5%) and Clarion Partners (5.2%) in 2025. In addition, Novartis (2.5%) and T&M Resources (2.5%) will be leaving at lease expiration in December 2026, according to the servicer. As a result, KBRA performed a stabilized analysis of KNCF and KBRA value. The analysis assumes a stabilized occupancy of 80.0%, which is lower than current submarket occupancy. We also accounted for deductions from value to account for the downtime, lease up costs and free rent that will be required to reach stabilization.

The analysis produced a stabilized KNCF of $48.0 million and a KBRA adjusted value of $465.7 million ($334 per sf). The current KLTV is 143.9%, a change from 137.0% at last review and 107.8% at issuance. An appraisal dated July 2025 valued the asset at $780.0 million ($560 per sf), a 36.1% decrease from $1.22 billion ($876 per sf) at securitization. KBRA maintains the loan’s K-LOC status and KPO of Underperform due to the decline in value since issuance and the loan’s foreclosure status with the special servicer.

Details concerning the classes with rating changes are as follows:

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