KBRA Downgrades Three Ratings of CD 2017-CD3 to D (sf) Following Realization of Principal Losses
9 Dec 2025 | New York
KBRA downgrades the ratings of the D, X-D, and V1-D certificates to D (sf) from CC (sf) for CD 2017-CD3, a $1.0 billion conduit transaction, following a $11.3 million realized loss incurred from the resolution of 166 Geary Street ($28.5 million original balance) and the reallocation of realized losses incurred from the resolution of the 229 West 43rd Street Retail Condo REO asset (originally largest, $100.0 million loan balance at issuance) as reflected in the November 2025 remittance report. 166 Geary Street was collateralized by a 12,713 sf retail building in San Francisco, California, located adjacent to Union Square and one block north of Market St, which is a main artery of downtown San Francisco. The asset was liquidated on November 13, 2025, for gross proceeds of $18.9 million, resulting in a loss of $11.3 million, reflecting a loss severity of 39.8%.
In November 2025, cumulative principal losses on the transaction's certificates totaled $119.3 million. After the updated reallocation of realized losses, Class E has been reduced to zero and the realized losses have resulted in the principal balance of Classes D and V1-D being reduced.
KBRA's other outstanding ratings are unchanged at this time.
Details concerning the classes with a rating change are as follows:
- Class D to D (sf) from CC (sf)
- Class X-D to D (sf) from CC (sf)
- Class V1-D to D (sf) from CC(sf)
Rating Sensitivities
Future rating actions will be dependent upon the ongoing assessment of the timing and likelihood of ultimate payment of principal and accrued interest on the rated certificates. The assessment will consider the expected and actual losses on the remaining assets in the transaction, as well as, the magnitude and extent of interest shortfalls, if any, on the certificates.
To access ratings and relevant documents, click here.