KBRA Upgrades Three Ratings and Affirms All Other Ratings for CGCMT 2013-375P
22 May 2024 | New York
KBRA upgrades the ratings of three classes and affirms all other outstanding ratings for CGCMT 2013-375P, a CMBS SASB transaction. The actions follow a surveillance review of the transaction, which has exhibited an improvement in performance since last review and securitization, primarily as a result of recent leasing activity, resulting in a meaningful increase in KNCF and higher KBRA value. The changes increase the likelihood that the borrower will be able to refinance at its next maturity date, which it failed to do at its original maturity date.
The transaction collateral is a $560.0 million portion of a $757.8 million, non-recourse, first lien mortgage loan. The loan is secured by the borrower’s fee simple interest in an 859,249 sf office property located at 375 Park Avenue between 52nd and 53rd streets in the Midtown neighborhood of New York City’s borough of Manhattan. The loan sponsor is RFR Holding LLC, a Manhattan-based privately controlled real estate investment company founded in 1991 by Aby Rosen and Michael Fuchs.
After the borrower failed to repay the loan by its original maturity date in May 2023, the loan was modified and extended for one year, with a second option to extend the maturity date to May 2025. The modification includes a cash flow sweep and principal paydowns associated with each extension of the term. According to the May 2024 remittance data, the loan is in the second extension period with a maturity date of May 6, 2025, and there is $23.4 million in the reserve accounts for the loan. In connection with the extensions, the principal balance of the loan has been reduced by $25.0 million.
KBRA analyzed the cash flow for the property utilizing information from the trustee and servicer to determine KNCF. The analysis produced a KNCF of $69.1 million and a KBRA value of $987.4 million ($1,149 per sf). The resulting KLTV is 76.7%, which is favorable to last review (87.2%) and securitization (91.8%). KBRA maintains the loan’s KPO of Perform due to improved performance since issuance.
Details concerning the classes with ratings changes are as follows:
- Class B to AA (sf) from A- (sf)
- Class C to A (sf) from BBB- (sf)
- Class D to BBB (sf) from BB (sf)
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