NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) releases its commercial real estate collateralized loan obligations (CRE CLO) Research Handbook, which gives an overview of the sector’s progression, summarizes and links to a variety of KBRA’s CRE CLO research pieces, and includes profiles on more than two dozen CRE CLO sponsors.
CRE CLOs experienced a third straight year of issuance growth in 2019. A total of $19.2 billion was securitized, representing a 40% year-over-year growth rate and nearly eightfold increase since 2016. KBRA believes this is an appropriate time to reflect on how the sector has progressed, given the growth experienced by this evolving market. In the handbook, KBRA uses selected research reports it has published over the past 12 months as well as primers produced in 2018 to compile key topic points. Additionally, CRE CLO sponsor profiles for KBRA-rated transactions are included.
Some of the developments discussed in the handbook and past research include:
- The shift in the market to more managed deals.
- A highly competitive lending marketplace helped to drive rates lower.
- Collateral managers gained more flexibility in modifying performing loans.
- Relatively few defaults occurred in the benign economic environment, and issuers have purchased credit risk and defaulted mortgage assets to avoid failing par value tests.
- Despite the competitive lending environment and increasing level of asset transition, credit support has visibly eroded among non-KBRA rated transactions.
To access the report, click here.
Related Publications: (available at www.kbra.com)
- CRE CLO Trend Watch: 2019 Issuance Up; Subordination Levels Down
- CRE CLO Trend Watch: Issuance on Track to Surpass 2018; Performance Buoyed by Buyouts
- A Look at CRE CLO Re-Bridging
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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) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.