Kroll Bond Rating Agency Assigns Preliminary Ratings to COMM 2014-CCRE19

NEW YORK--()--Kroll Bond Rating Agency (KBRA) is pleased to announce the assignment of preliminary ratings to 17 classes of the COMM 2014-CCRE19 transaction (see ratings list below). COMM 2014-CCRE19 is a $1.2 billion CMBS conduit transaction collateralized by 68 fixed rate commercial mortgage loans that are secured by 86 properties.

The underlying collateral properties are located in 28 different states, with three state exposures each representing at least 10.0% of the pool balance: California (19.6%), New York (19.3%) and Florida (10.0%). There is exposure to all of the major property type segments, with four that each account for over 15.0% of the pool: office (26.6%), hospitality (20.8%), multifamily (17.2%) and retail (16.0%). The loans have principal balances ranging from $2.0 million to $77.5 million for the largest loan in the pool, Bridgepoint Tower (6.6%) an 11-story, 273,764 sf, Class-A office building located in San Diego, California. The top five loans, which also include The Shoppes at Webb Gin (5.4%), Cipriani Events Portfolio (5.1%), Park at Siena (5.0%) and Post Ranch Inn (4.3%), represent 26.4% of the initial pool balance, while the top 10 loans represent 42.4%.

KBRA’s analysis of the transaction incorporated our multi-borrower rating process that begins with our analysts' evaluation of underlying collateral properties' financial and operating performance, which determine KBRA’s estimate of sustainable net cash flow (KNCF) and KBRA value using our CMBS Property Evaluation Guidelines. On an aggregate basis, KNCF was 4.8% less than the issuer cash flow. KBRA capitalization rates were applied to each asset’s KNCF to derive values that were, on an aggregate basis, 35.3% less than third party appraisal values. The pool has an in-trust KLTV of 101.3% and an all-in KLTV of 104.7%. The model deploys rent and occupancy stresses, probability of default regressions, and loss given default calculations to determine losses for each collateral loan, which are then used to assign our credit ratings.

For complete details on the analysis, please see our presale report, COMM 2014-CCRE19 published today at www.kbra.com. The preliminary ratings are based on information known to KBRA at the time of this publication. Information received subsequent to this release could result in the assignment of final ratings that differ from the preliminary ratings.

Preliminary Ratings Assigned: COMM 2014-CCRE19

Class         Class Balance         Expected Rating
A-1         $69,931,000         AAA(sf)
A-2         $168,679,000         AAA(sf)
A-3         $15,824,000         AAA(sf)
A-SB         $94,344,000         AAA(sf)
A-4         $190,000,000         AAA(sf)
A-5         $283,135,000         AAA(sf)
X-A         $911,443,000 *         AAA(sf)
X-B         $108,610,000 *         AAA(sf)
X-C         $36,693,000 *         BB-(sf)
X-D         $52,837,569 *         NR
A-M         $89,530,000         AAA(sf)
B         $55,773,000         AA(sf)
PEZ         $198,140,000         A(sf)
C         $52,837,000         A(sf)
D         $64,579,000         BBB-(sf)
E         $23,483,000         BB(sf)
F         $13,210,000         BB-(sf)
G         $13,209,000         B(sf)
H         $39,628,569         NR

* Notional balance

17g-7 Disclosure

All Nationally Recognized Statistical Rating Organizations are required, pursuant to SEC Rule 17g-7, to provide a description of a transaction’s representations, warranties and enforcement mechanisms that are available to investors when issuing credit ratings. KBRA’s disclosure for this transaction can be found in the report entitled CMBS: COMM 2014-CCRE19 17G-7 DISCLOSURE REPORT.

Related publications: (available at www.kbra.com)
CMBS: COMM 2014-CCRE19 Presale Report
CMBS: U.S. CMBS Multi-Borrower Rating Methodology, published February 23, 2012
CMBS Property Evaluation Guidelines, published June 10, 2011

About Kroll Bond Rating Agency KBRA is registered with the U.S. Securities and Exchange Commission as a Nationally Recognized Statistical Rating Organization (NRSRO). In addition, KBRA is recognized by the National Association of Insurance Commissioners (NAIC) as a Credit Rating Provider (CRP).

Contacts

Analytical Contacts:
Kroll Bond Rating Agency
Ravish Kamath, 646-731-2328
rkamath@kbra.com
or
Joseph Kelly, 646-731-2365
jkelly@kbra.com
or
Dayna Volpe, 646-731-2391
dvolpe@kbra.com
or
Ken Kor, 646-731-2339
kkor@kbra.com
or
Follow us on Twitter!
@KrollBondRating

Contacts

Analytical Contacts:
Kroll Bond Rating Agency
Ravish Kamath, 646-731-2328
rkamath@kbra.com
or
Joseph Kelly, 646-731-2365
jkelly@kbra.com
or
Dayna Volpe, 646-731-2391
dvolpe@kbra.com
or
Ken Kor, 646-731-2339
kkor@kbra.com
or
Follow us on Twitter!
@KrollBondRating