KBRA Releases Monthly CMBS Trend Watch

Kroll Bond Rating Agency (KBRA) releases November’s CMBS Trend Watch.

CMBS private label pricing volume ended November at $10.7 billion. This brings the year-to-date (YTD) issuance total to $80.9 billion, up 13.6% on a year-over-year (YoY) basis. Conduits led the charge with $8.5 billion, or approximately 80% of the month’s volume. As for December, we expect that by the time the curtain closes, we will see the launch of up to nine single-borrower (SB) transactions, as well as two conduits, and a couple of Freddie Mac K-Series securitizations.

In the Spotlight section, we look at KBRA’s CMBS rating actions since 2012. Ratings have exhibited stable behavior this year. The vast majority of the 3,265 CMBS rating actions taken YTD November were affirmations (3,170), followed by downgrades (48) and upgrades (47). Negative rating actions have almost doubled from the full-year 2018 level (27), while there were approximately 28% fewer upgrades (65).

In November, we published 12 transaction pre-sales, including five conduits ($4.8 billion), three single-borrower ($2 billion), two small balance commercial ($718 million), one single-family rental ($376.2 million), and one commercial real estate collateralized loan obligation ($426.2 million). November’s surveillance activity included rating actions on 430 classes consisting of 407 affirmations, 21 upgrades, and two downgrades. KBRA also highlighted 76 KBRA Loans of Concern (K-LOCs), as well as 19 KBRA Performance Outlook (KPO) changes.

November’s three-month rolling average KBRA loan-to-value (KLTV) rose slightly to 100.1% compared to 100% in October. This, however, comes after rising 230 basis points in September.

To view the report, click here.

Related Publications: (available at www.kbra.com)

• 2020 CMBS Outlook: This Time Is Different?

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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) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.

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