KBRA Assigns Preliminary Ratings to CPTS 2019-CPT

NEW YORK–(BUSINESS WIRE)–Kroll Bond Rating Agency (KBRA) announces the assignment of preliminary ratings to seven classes of CPTS 2019-CPT, a CMBS single-borrower securitization.

The collateral for the transaction is a $700.0 million portion of a $1.2 billion non-recourse, first lien mortgage loan. The fixed rate loan has a ten-year term and requires monthly interest-only payments. The loan is secured by the borrower’s fee simple interest in Century Plaza Towers, a 2.4 million sf, 44-story twin tower Class-A office asset and a six-story subterranean parking garage located in the Century City neighborhood of Los Angeles, approximately 10 miles west of the city’s CBD. The LEED Gold certified towers are mirror images of each other and feature a combination of aluminum and glass. The property features high end tenant build outs and includes a subterranean parking garage with 5,910 parking spaces.

As of October 2019, the property was 92.9% leased to 122 tenants. The five largest tenants are either financial institutions or large law firms, and include Bank of America (6.2% of total sf, 6.5% of base rent), Manatt Phelps (4.8%, 5.5%), JP Morgan (4.1%, 4.2%), Kirkland & Ellis (3.6%, 4.5%) and Greenberg Glusker (3.5%, 4.2%). Together, these five tenants account for 22.2% of the total sf and 24.9% of total base rent.

KBRA’s analysis of the transaction included a detailed evaluation of the properties’ cash flows using our U.S. CMBS Property Evaluation Methodology and the application of our U.S. CMBS Single Borrower & Large Loan Rating Methodology. In addition, KBRA also relied on its Global Structured Finance Counterparty Methodology for assessing counterparty risk in this transaction, to the extent deemed applicable.

The results of our analysis yielded a KBRA net cash flow (KNCF) of $109.2 million. To value the property, we applied a capitalization rate of 7.50% to arrive at a KBRA value of $1.4 billion. The resulting KBRA Loan to Value (KLTV) is 86.4%. In our analysis of the transaction, we also reviewed and considered third party engineering, environmental, and appraisal reports; the results of our site inspection of the property, and legal documentation review.

For further details on KBRA’s analysis, please see our pre-sale report, CPTS 2019-CPT, published 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: CPTS 2019-CPT

Class

Initial Class Balance

Expected KBRA Rating

A

$269,952,000

AAA (sf)

B

$59,990,000

AA+ (sf)

C

$44,992,000

A+ (sf)

D

$117,845,000

BBB+ (sf)

E

$139,950,000

BBB- (sf)

F

$32,271,000

BB+ (sf)

X

$269,952,0001

AAA (sf)

1Notional amount.

To access ratings, reports and disclosures, click here.

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

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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.

Contacts

Analytical Contacts:
Ravish Kamath, Director

(646) 731-2328

rkamath@kbra.com

Michael Brown, Managing Director

(646) 731-2307

mbbrown@kbra.com

Susannah Keagle, Senior Director

(646) 731-3357

skeagle@kbra.com

Business Development Contact:
Michele Patterson, Managing Director

(646) 731-2397

mpatterson@kbra.com

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