KBRA Downgrades Five Ratings and Affirms All Other Ratings for CGCMT 2016-P5
2 Aug 2024 | New York
KBRA downgrades the ratings of five classes and affirms all other outstanding ratings for CGCMT 2016-P5, a $748.2 million CMBS conduit transaction. The rating actions follow a surveillance review of the transaction, which has exhibited an increase in KBRA's estimated losses on five of the K-LOCs (12.5% of the pool balance). However, the top of the transaction’s capital structure has benefitted from deleveraging from loan payoffs, amortization, and defeasance.
As of the July 2024 remittance period, there are three specially serviced loans (9.1%), of which two (6.5%) are in foreclosure and one (2.5%) is 90+ days delinquent. KBRA identified 11 K-LOCs (46.0%), including the specially serviced assets. These include:
Six of the top 10 loans (34.4%):
- Hyatt Regency Jersey City (largest, 8.7% of the pool balance)
- Plaza America I & II (2nd largest, 8.0%)
- Crocker Park Phase One & Two (4th largest, 5.1%)
- College Boulevard Portfolio (6th largest, 4.6%)
- Flagler Corporate Center (8th largest, 4.0%)
- 332 South Michigan (9th largest, 4.0%, 35.9% estimated loss severity)
Four other K-LOCs (8.5%) have an estimated loss:
- 11 East Broadway (2.6%, 49.3% estimated loss severity)
- National Business Park (2.5%, 20.3%)
- Financial Plaza (1.8%, 6.9%)
- West LA Office - 1950 Sawtelle Boulevard (1.6%, 25.0%)
The remaining K-LOC does not have estimated losses and represents 3.1% of the pool.
Excluding the K-LOCs with estimated losses, the transaction’s WA KLTV is 106.1%, compared to 107.3% at last review and 98.4% at securitization. The WA KDSC is 1.86x, which is unchanged from last review and down from 1.99x at issuance.
Details concerning the classes with rating changes are as follows:
- Class C to A- (sf) from A (sf)
- Class D to BB (sf) from BBB- (sf)
- Class E to B- (sf) from BB (sf)
- Class F to CCC (sf) from B- (sf)
- Class X-D to BB (sf) from BBB- (sf)
To access rating and relevant documents, click here.
Click here to view the report.