KBRA Downgrades Eight Ratings and Affirms All Other Ratings for COMM 2015-LC23

KBRA downgrades the ratings of eight classes of certificates and affirms all other outstanding ratings for COMM 2015-LC23, a $662.2 million CMBS conduit transaction. The rating actions follow a surveillance review of the transaction which has exhibited an increase in KBRA's estimated losses since KBRA's last rating change in September 2020. The estimated losses are from four K-LOCs (23.1% of the pool balance), including three of the top 10 loans (21.6%). The rating actions also consider deleveraging of the transaction from loan payoffs, amortization and defeasance, as well as the risk of interest shortfalls reaching higher in the capital structure as the special servicer resolves the specially serviced assets and those loans unable to payoff at their upcoming maturity.

As of the September 2024 remittance period, there are two specially serviced assets (8.4%), of which one is REO (1.5%) and one is in foreclosure (6.9%). KBRA identified six K-LOCs (27.7%), including the specially serviced assets. Of the K-LOCs, three (12.5%) have estimated losses. They include:

Four of the top 10 loans (25.7%):

One other K-LOC (1.5%) has an estimated loss:

The remaining K-LOC does not have estimated losses and represents 0.6% of the pool balance. Additional details can be found in the K-LOC Summary section of this report.

Excluding the K-LOCs with estimated losses, the transaction’s WA KLTV is 82.3%, compared to 91.5% at last review and 102.1% at securitization. The KDSC is 1.81x, compared to 1.76x at last review and 1.74x at issuance.

Details concerning the classes with rating changes are as follows:

To access rating and relevant documents, click here.

Click here to view the report.

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