KBRA Downgrades One Rating and Affirms All Other Ratings for GSMS 2018-RIVR
18 May 2026 | New York
KBRA downgrades one rating and affirms all of the other outstanding ratings for GSMS 2018-RIVR, a CMBS SASB transaction. The downgrade reflects the continued decline in performance of the loan collateral, River North Point, since KBRA’s last ratings adjustments in May 2025, the loan’s foreclosure status, and the fact that interest shortfalls are affecting all rated classes. The loan was transferred to the special servicer in May 2023 and as of May 2026, there is a $244.6 million ARA, cumulative ASER amount of $31.5 million, and total servicer advances of $9.6 million. Due to the magnitude of the current ASER, with the exception of Class A, none of the rated classes of certificates have received monthly interest distributions since June 2024. Class A had been receiving distributions of about 70.0% of its monthly accrued interest, but this has fluctuated between 39.0% and 52.4% since the May 2025 reporting.
KBRA previously downgraded the ratings of three classes following a surveillance review of the transaction in May 2025. The downgrades were primarily driven by a reduction in the collateral property’s appraised value to $87.0 million ($67 per sf) in December 2024 from $160.0 million ($123 per sf) in January 2024, and concurrent increase in interest shortfalls.
The collateral for the transaction is a $309.8 million non-recourse, first lien floating rate mortgage loan that had an initial two-year term with five one-year extension options and requires monthly interest-only payments based on one month Term SOFR plus an initial spread of 1.495%. The financing includes mezzanine debt of $60.0 million. The loan is secured by the borrower’s fee simple interest in 1.3 million sf of River North Point, a Class-A, LEED Gold certified office property located in the River North submarket of Chicago, within the city’s CBD. The River North submarket has weakened significantly in recent quarters. According to Colliers's Q1 2026 CBD Office Report, the overall Chicago office market vacancy was 24.7%, with the River North submarket posting total availability of 29.3%.
According to the September 2025 rent roll, inclusive of leasing updates from the servicer, property occupancy is 57.4%, down from 60.2% at KBRA’s last review and 92.1% at closing. While occupancy remains relatively unchanged from last review, the property’s second-largest tenant, Brookfield Properties Retail Inc., has reportedly executed a new 15-year lease with a starting annual base rent that is 43.0% below its current annual base rent. The current lease expires in December 2027 and the new lease expires in December 2042. According to the December 2025 asset status report, the special servicer’s plan is to continue leasing the asset and prepare it for a receivership sale.
KBRA analyzed the cash flow for the property utilizing information from the trustee and servicer to determine KNCF. Accounting for the new Brookfield rent, KBRA’s analysis produced a KNCF of $5.4 million and a KBRA value of $51.5 million ($40 per sf). KBRA adjusted this value upward by $4.3 million to account for a portion of the amount held in the cash management reserve account, resulting in a reserve-adjusted value of $55.8 million ($43 per sf). The resulting in-trust KLTV is 555.2%, compared to 354.5% at last review and 99.6% at securitization. Based on KBRA’s value, it is likely that the trust will incur principal losses upon final disposition of the asset.
The most recent servicer-reported occupancy and DSC are 72.0% and 0.53x respectively for the FY 2023.
KBRA maintains the loan’s K-LOC status and its KPO of Underperform.
Rating Sensitivities
Future rating actions will be dependent upon the ongoing assessment of the timing and likelihood of ultimate payment of principal and accrued interest on the rated certificates which will be dependent on the value of the asset and the disposition of the loan. The assessment will consider the expected and actual losses, as well as the magnitude and extent of accrued interest shortfalls on the certificates.
Details for the class with a rating change are as follows:
- Class A to C (sf) from CCC (sf)
Details for the classes with rating affirmations are as follows:
- Class B at C (sf)
- Class C at C (sf)
- Class D at C (sf)
- Class E at C (sf)
- Class F at C (sf)
- Class G at C (sf)
To access ratings and relevant documents, click here.