NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) affirmed its ‘AAA’ ratings on Classes A and X of COMM 2011-FL1, a CMBS large loan transaction. Concurrently, classes B, C, and D have been placed on “Watch Upgrade” (UP) and classes E and F have been placed on “Watch Developing” (DEV).
The affirmations and Watch Upgrade placements are due to actual and anticipated deleveraging that will occur upon the pay-off of one of the two remaining loans in the transaction, One Kendall Square, which represents 44.3% of the aggregate transaction balance. The master servicer, Wells Fargo Bank, National Association, has indicated that the related borrower intends to pay off the loan in full before its maturity date on December 4, 2013, and forego two remaining one-year extension options. In addition, a CMBS industry publication (Commercial Mortgage Alert, October 4, 2013) indicated that JPMorgan has agreed to provide new financing for the property.
The remaining Watch placements are due to the underperformance of The Standard Hotel loan, which represents 55.7% of the aggregate transaction balance. The Standard Hotel Loan is secured by the borrower’s fee simple interest and the operating lessee’s leasehold interest in a 337-key full-service boutique hotel located in New York City. KBRA is in the process of completing its analysis of the loan using information from the certificate administrator’s website, and we have requested additional performance information from the master servicer. Based on our preliminary analysis, it appears that the property’s KNCF has declined further since our last review, when it was 5.1% lower than at securitization. The finalization of the analysis will also have a bearing the magnitude of potential upgrades on classes B, C, and D, as well as what negative rating actions, if any, occur on classes E and F.
| Rating Actions | ||||||||||||||||
| Class | Original Rating | Current Rating | Original C/E | Current C/E | ||||||||||||
| A | AAA (sf) | AAA (sf) | 41.5% | 55.5% | ||||||||||||
| X | AAA (sf) | AAA (sf) | N/A | N/A | ||||||||||||
| B | AA (sf) | AA (sf) (UP) | 31.3% | 51.8% | ||||||||||||
| C | A (sf) | A (sf) (UP) | 20.3% | 27.1% | ||||||||||||
| D | BBB (sf) | BBB (sf) (UP) | 13.4% | 17.9% | ||||||||||||
| E | BBB- (sf) | BBB- (sf) (DEV) | 4.6% | 6.2% | ||||||||||||
| F | BB (sf) | BB (sf) (DEV) | 0.0% | 0.0% | ||||||||||||
Related Publications (available at https://www.krollbondratings.com):
COMM 2011-FL1 Pre-Sale ReportCOMM 2011-FL1 Surveillance Report (October 2012)CMBS Single Borrower and Large Loan Rating MethodologyCMBS Property Evaluation Guidelines
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