NEW YORK–(BUSINESS WIRE)–Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to nine classes of certificates issued in the CoreVest American Finance 2019-3 (CAF 2019-3) securitization. This is the tenth transaction issued by CoreVest American Finance.
CAF 2019-3 is a $376.2 million multi-borrower securitization that will be collateralized by 128 fixed-rate loans secured by first priority mortgages on 5,129 rental units in 3,102 income-producing single-family, 2-4 family, and multifamily properties. The subject pool includes 74 multifamily properties (1,648 units), which represent 23.8% of the total pool balance. The properties are located in 32 states, with the largest three exposures comprised of New Jersey (17.6%), Texas (16.4%), and Florida (7.0%). The loans have principal balances ranging from $0.4 million to $45.5 million for the largest loan in the pool. The five largest loans represent 26.0% of the initial pool balance, while the ten largest loans represent 37.4%.
For the purposes of facilitating the analysis, KBRA divided the underlying properties into two distinct sub-pools by property type. Sub-pool 1 (1-4 units) is primarily comprised of single-family rental homes and 2-4 unit properties (3,028 properties, 76.2%). Sub-pool 2 (multifamily) is comprised of properties that consist of five or more units (74 properties, 23.8%), which also includes a number of larger multifamily properties that are similar to multifamily assets found in traditional CMBS securitizations. KBRA used its U.S. Single-Family Rental Securitization Methodology to evaluate sub-pool 1, whereas sub-pool 2 was analyzed in a manner that is generally consistent with KBRA’s approach discussed in our U.S. CMBS Property Evaluation Methodology and U.S. CMBS Multi-Borrower Rating Methodology. The results of these analyses were then blended, and pool level concentration and qualitative adjustments were then applied to determine KBRA’s credit enhancement levels for the subject pool. The results of this analysis were then compared to the issuer’s proposed capital structure to assign ratings.
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.
For further details on KBRA’s analysis, please see our pre-sale report, entitled CoreVest American Finance 2019-3 Pre-Sale Report, which is published at www.kbra.com
|
Class |
Expected Rating |
Balance (USD) |
Rating Action |
||
|
A |
AAA (sf) |
$251,088,000 |
Preliminary |
||
|
X-A1 |
AAA (sf) |
$251,088,000 |
Preliminary |
||
|
X-B2 |
AAA (sf) |
$80,875,000 |
Preliminary |
||
|
B |
AA- (sf) |
$34,324,000 |
Preliminary |
||
|
C |
A- (sf) |
$25,862,000 |
Preliminary |
||
|
D |
BBB (sf) |
$20,689,000 |
Preliminary |
||
|
E |
BB+ (sf) |
$10,020,000 |
Preliminary |
||
|
F3 |
BB- (sf) |
$10,668,000 |
Preliminary |
||
|
G3 |
B- (sf) |
$6,113,000 |
Preliminary |
||
|
H3 |
NR |
$17,398,037 |
N/A |
||
- Notional balance equal to the aggregate outstanding balance of the Class A certificates.
- Notional balance equal to the aggregate outstanding balance of the Class B, C, and D certificates.
- To satisfy the U.S. risk retention requirements, the transaction sponsor will retain an “eligible horizontal residual interest” consisting of the Class F, Class G, and Class H certificates, which collectively represent at least 5.0% of the fair value of all non-residual interests issued on the closing date.
To access ratings, reports and disclosures, click here.
Related Publications: (available at www.kbra.com)
- CoreVest American Finance 2019-3 Pre-Sale Report
- Representations and Warranties Disclosure
- U.S. Single-Family Rental Securitization Methodology
- U.S. CMBS Property Evaluation Methodology
- U.S. CMBS Multi-Borrower Rating Methodology
- Methodology for Rating Interest-Only Certificates in CMBS Transactions
- Global Structured Finance Counterparty Methodology
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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.
Contacts
Analytical Contacts:
Neel Munot, Associate
(646) 731-1215
[email protected]
Akshay Maheshwari, Director
(646) 731-2394
[email protected]
Daniel Tegen, Senior Director
(646) 731-2429
[email protected]
Nitin Bhasin, CFA, Senior Managing Director
(646) 731-2334
[email protected]
Business Development Contact:
Michele Patterson, Managing Director
(646) 731-2397
[email protected]
