KBRA Affirms All Ratings for LMNT 2021-FL1
13 Jun 2025 | New York
KBRA affirms all of its outstanding ratings for LMNT 2021-FL1, a CRE CLO transaction with the ability to reinvest principal proceeds for 30 months. The affirmations follow a surveillance review of the transaction, which has exhibited continued deleveraging since the last ratings change in June 2024. However, the transaction has exhibited a worsening in collateral performance since securitization including the addition of specially serviced loans and K-LOCs with losses.
At the time of this review, the total collateral balance is $618.2 million, which is comprised of 35 first mortgage loans secured by 52 properties. During the reinvestment period, the issuer could acquire previously unidentified whole loans and senior participations that satisfied the eligibility criteria. The reinvestment period ended in December 2023, as expected. As of the May 2025 remittance period, there are five (12.8% of the pool balance) specially serviced loans, which include one REO asset (2.5%), one delinquent loan (1.7%), and three matured performing loans (8.6%). In addition to the specially serviced loans, seven additional loans (15.5%) are matured performing. KBRA identified 10 K-LOCs (25.0%), which includes the specially serviced loans (12.8%) as well as one additional matured performing loan (2.2%). Two of the K-LOCs (3.0%) have estimated losses. The K-LOCs are depicted in the table below:
The transaction’s WA KLTV is 131.5%, compared to 132.9% at last ratings change in June 2024 and 124.3% at securitization. The KDSC at Index Cap is 1.11x, compared to 1.07x at last ratings change and 1.03x at securitization. The overcollateralization and interest coverage tests have each been satisfied during each distribution date since issuance.
At securitization, 34 loans (66.2% of issuance balance) had related companion participations representing unfunded future advance obligations, with an aggregate unfunded amount of $41.8 million.In total, there are currently 22 loans (67.4% of current balance), with unfunded future advance obligations with an aggregate of $24.8 million unfunded
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