Press Release|CMBS
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KBRA Places All Ratings of Atom Mortgage Securities DAC on Watch Downgrade

17 Sep 2025   |   London

Contacts

KBRA places the ratings of five classes of Atom Mortgage Securities DAC, a CMBS single-borrower transaction, on Watch Downgrade (DN).

The Watch placements are based on the deterioration of the performance of the underlying collateral since our last review. Occupancy across the three-property portfolio has declined to 72.8% from 82.6%. In addition, tenants representing 6.4% of in-place rent have either break options or leases expiring by the loan’s final maturity date on 20 July 2026. The portfolio's vacancy rate significantly exceeds the market vacancy after several recent tenant departures.

The Watch placements also reflect KBRA’s expectation of receiving updated market and property information to provide greater clarity on the potential for the borrower to re-lease and stabilize the occupancy in the near term.

As per the December 2024 valuation, the portfolio’s appraisal value stands at £403.9 million, reflecting a 12.7% decline since KBRA's last review and a 17.3% decrease since closing. The transaction is currently in a cash trap as of the July 2025 IPD, following breaches of the cash trap event trigger thresholds; the reported LTV of 76.2% exceeded the 69.5% threshold, while the debt yield of 7.3% fell below the 7.5% threshold.

KBRA will continue to monitor the transaction and underlying loan performance, with the aim of resolving or updating the Watch Downgrade status within 90 days.

Details concerning the classes with ratings placed on Watch Downgrade are as follows:

Class A to AAA (sf) DN from AAA (sf)

Class B to AAA (sf) DN from AAA (sf)

Class C to AA- (sf) DN from AA- (sf)

Class D to BBB+ (sf) DN from BBB+ (sf)

Class E to BB+ (sf) DN from BB+ (sf)

To access ratings and relevant documents, click here.

Related Publication

Methodologies

Disclosures

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.

This credit rating is endorsed by Kroll Bond Rating Agency Europe Limited for use in the European Union. Information on a credit rating’s endorsement status is available on its rating page at KBRA.com.

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.

There are certain issuers, entities or transactions rated by KBRA Europe or KBRA UK that may be or have relationships with Shareholders and/or Shareholder-Related Companies, as that term is defined in KBRA’s Shareholder and Shareholder Related Companies for KBRA Europe and KBRA UK Policy and Procedure. Relevant disclosure information may be found here.

About KBRA UK

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA 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 (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S. Kroll Bond Rating Agency UK is located at 1 Connaught Place, 2nd Floor London, England.

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