NEW YORK--(EON: Enhanced Online News)--Kroll Bond Rating Agency (KBRA) is pleased to announce the assignment of preliminary ratings to seven classes of the Madison Avenue Trust 2013-650M transaction (see ratings list below). Madison Avenue Trust 2013-650M is a CMBS single borrower transaction collateralized by a single non-recourse, first lien mortgage loan with a principal balance of $675.0 million.
The loan was co-originated by Goldman Sachs Mortgage Company and German American Capital Corporation on September 30, 2013 and is secured by the borrower’s fee interest in a 594,470 square foot (sf) Class-A office building with ground and second level retail located at 650 Madison Avenue, in the Plaza District of Midtown Manhattan. The property is a 27-story building containing 503,872 sf of office space, 54,571 sf of retail space and 36,027 sf of storage space. The property was built in 1957 and subsequently renovated and expanded by 19 stories in 1987. As of September 2013, the building was 91.3% leased to seven office tenants and three retail tenants. The largest tenant is Polo Ralph Lauren, a High Quality Credit-Worthy Tenant (HQCWT) that leases 46.0% of the total sf for its global headquarters. Other major tenants include Memorial Sloan Kettering Cancer Center (HQCWT, 16.9%) and Crate & Barrel (10.3%). The collateral is being acquired by affiliates of Vornado Realty Trust and Oxford Properties Group in a joint venture with other limited partners.
KBRA’s analysis of the transaction included a detailed evaluation of the property’s cash flow using our CMBS Property Evaluation Guidelines, and the application of our CMBS Single Borrower and Large Loan Rating Methodology. The results of our analysis yielded a KBRA Net Cash flow (KNCF) of $55.4 million. To value the property, we applied a 6.84% capitalization rate to arrive at a value of $810.4 million. Our resulting KBRA Loan to Value (KLTV) was 83.3%. As part of the transaction analysis, KBRA also reviewed and considered third party engineering, environmental and appraisal reports, our own on-site inspection of the subject property and competitor properties, as well as loan and securitization level legal documentation.
For complete details on the analysis, please see our Pre-Sale Report, entitled Madison Avenue Trust 2013-650M, which was published today at www.krollbondratings.com.
The preliminary ratings are based on information known to KBRA at the time of this publication. Information received subsequent to this release could result in the assignment of final ratings that differ from the preliminary ratings.
Preliminary Ratings Assigned: Madison Avenue Trust 2013-650M
|Class||Expected Rating||Balance (US$)|
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 Madison Avenue Trust 2013-650M 17g-7 Disclosure Report.
About Kroll Bond Rating Agency
KBRA was established in 2010 by Jules Kroll to restore trust in credit ratings by creating new standards for assessing risk and by offering accurate, clear and transparent ratings. 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).