Press Release|CMBS

KBRA Downgrades Three Ratings and Affirms All Other Ratings for LSTAR 2017-5

22 Mar 2024   |   New York


KBRA downgrades the ratings of three classes of certificates and affirms all other outstanding ratings of LSTAR 2017-5, a $514.4 million CRE multi-borrower transaction. The rating actions follow a surveillance review of the transaction, which has exhibited a worsening in credit metrics since last review, including an increase in the number of specially serviced loans, K-LOCs and KBRA's estimated losses. The transaction's credit enhancement has improved due to loan payoffs and amortization.

As of the March 2024 remittance period, two loans (16.0%) are specially serviced. KBRA identified four K-LOCs (21.6%), including the specially serviced loans. Of the K-LOCs, three (19.0%) have estimated losses. The K-LOCs include:

Two top 10 loans (16.7%), both of which have estimated losses:

  • Charlotte Plaza (largest, 13.6% of pool balance, 42.6% estimated loss severity)
  • Dowlen Town Center (10th largest, 3.1%, 17.4%)

The two remaining K-LOCs are 4.9% of the pool, one of which also has an estimated loss:

  • Whitehorse Road (2.3%, 61.5% estimated loss severity)

Excluding K-LOCs with estimated losses, the transaction’s WA KLTV is 113.5%, compared to 126.4% at last review and 108.4% at securitization. The KDSC is 1.23x, compared to 1.30x at last review and 1.52x at securitization.

Details concerning the classes with ratings changes are as follows:

  • Class D to BB- (sf) from BBB- (sf)
  • Class E to CCC (sf) from B (sf)
  • Class F to CC (sf) from CCC (sf)

To access rating and relevant documents, click here.

Click here to view the report.

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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: 1003621

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