Press Release|CMBS

KBRA Downgrades Eight Ratings and Affirms All Other Ratings for MSC 2016-UBS12

6 Dec 2024   |   New York

Contacts

KBRA downgrades the ratings of eight classes of certificates and affirms all other outstanding ratings of MSC 2016-UBS12, a $697.8 million CMBS conduit transaction. The rating actions follow a surveillance review of the transaction, which has exhibited an increase in estimated losses since the last ratings changes in December 2023, primarily associated with the largest loan in the pool, 681 Fifth Avenue (11.5% of the pool balance).

As of the November 2024 remittance report, there are 12 specially serviced assets (19.5%), including one REO asset (2.3%), one delinquent loan (11.5%), and 10 current loans (5.8%). KBRA identified seventeen K-LOCs (37.4%) including the specially serviced loans. These include three top 10 loans:

  • 681 Fifth Avenue (largest, 11.5% of the pool balance, 61.4% estimated loss severity)
  • Wolfchase Galleria (3rd largest, 9.4%, 33.2% estimated loss severity)
  • Vintage Park (7th largest, 5.1%)

Three other K-LOCs have estimated losses:

  • Arkansas Multifamily Portfolio (2.3%, 26.1%)
  • Courtyard Van Nuys Apartments (0.5%, 37.3%)
  • Comfort Suites - Golden Isles Gateway (0.5%, 43.7%)

The remaining 11 K-LOCs do not have estimated losses and represent 8.1% of the pool.

Excluding the K-LOCs with estimated losses, the transaction's WA KLTV is 98.7%, compared to 98.8% at the last ratings change in December 2023 and 108.2% at KBRA's previous change in December 2020. The KDSC is 1.62x, compared to 1.68x at KBRA's most recent ratings change and 1.65x at KBRA's previous ratings change.

Details concerning the classes with ratings changes are as follows:

  • Class B to A (sf) from AA+ (sf)
  • Class C to BBB- (sf) from A- (sf)
  • Class D to CCC (sf) from B (sf)
  • Class E to CC (sf) from CCC (sf)
  • Class F to C (sf) from CC (sf)
  • Class X-D to CCC (sf) from B (sf)
  • Class X-E to CC (sf) from CCC (sf)
  • Class X-F to C (sf) from CC (sf)

To access ratings and relevant documents, click here.

Click here to view the report.

Related Publication

Methodologies

Disclosures

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 www.kbra.com.

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: 1007118

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