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KBRA Releases Monthly CMBS Trend Watch

NEW YORK–(BUSINESS WIRE)–Kroll Bond Rating Agency (KBRA) releases August’s CMBS Trend Watch.

CMBS private label pricing volume ended the month of August 17.8% higher than July, coming in at $3.9 billion and bringing the year-to-date (YTD) issuance total to $35.9 billion. On a year-over-year (YoY) basis, volume is off 27.9% from 2019. In regard to the forward pipeline, KBRA currently has visibility of up to twelve deals that could launch through early October including four conduits, two to four single-borrower transactions, one small balance commercial transaction, one Freddie Mac K-Series, and two commercial real estate collateralized loan obligation (CRE CLO) transactions.

The Spotlight section discusses lodging operating performance and delinquencies by segment. STR metrics indicate that the lodging segments have performed differently during the pandemic. The hardest hit classes include Upper Upscale and Upscale where revenue per available room (RevPAR) for the week ending on August 29 was down 63.1% and 48.3%%, respectively. At the other end of the spectrum are the Midscale and Economy classes, which RevPAR was down 28.2% and 23.2%, respectively. KBRA examined the lodging loans that were delinquent, specially serviced but current, and those where the borrower has entered into some form of temporary pandemic relief across KBRA’s rated conduit universe to determine how the different classes stack up from a credit perspective. Not surprisingly, Midscale and Economy segments make up the smallest portion of lodging delinquencies, specially serviced loans, and those that have been granted relief. On the other end, the Upscale and Upper Midscale segments posted the highest proportion of delinquencies.

In August, KBRA published pre-sales for two conduit deals totaling $1.2 billion. August’s surveillance activity included rating actions on 426 classes consisting of 392 affirmations and 34 downgrades across 38 transactions. KBRA highlighted 380 KBRA Loans of Concern as well as 98 KBRA Performance Outlook changes.

Click here to view the report.

About KBRA and KBRA Europe

KBRA is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider and is a certified Credit Rating Agency (CRA) with the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe is registered with ESMA as a CRA. Kroll Bond Rating Agency Europe is located at 6-8 College Green, Dublin 2, Ireland.


Analytical Contacts

Giselle Vuong, Senior Analyst

+1 (646) 731-2435

Larry Kay, Senior Director

+1 (646) 731-2452

Roy Chun, Managing Director

+1 (646) 731-2376

Eric Thompson, Senior Managing Director

+1 (646) 731-2355

Business Development Contact

Michele Patterson, Managing Director

+1 (646) 731-2397


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