A pool of 74 commercial mortgage loans on 92 properties will secure a $1 billion CMBS conduit transaction from BANK 2025-BNK51, with a significant number of the loans having future additional debt provisions.
One of the loans has existing subordinate debt and permits future mezzanine debt, while 42 of the loans include cooperative loans, which are permitted to incur future secured and unsecured debt.
About 16 tranches of notes will be issued to investors, and all the notes have a rated final distribution date of December 2067, according to Kroll Bond Rating Agency. The A5 tranche will issue the bulk of the transaction's notes, with $505.5 million, the rating agency said.
There are 72 sponsors on the deal, and the loan coupon, on average, is 6.16%, with a remaining term of 9.9 years. The rating agency's interest only index on the loan is 68.7%, and its capitalization rate is 9.49%, said KBRA, which added that retail properties account for 30.7% of the pool.
Multifamily and office property types follow retail, with 19.9% and 17.7% of the pool. Properties considered "other."
Thirty-nine of the loans have an amortizing balloon, but they only account for 26.9% of the pool. Full-term, interest-only loans account for the majority, 66.2%, of the pool.
In one positive credit aspect to the deal, the overall pool has a weighted average (W) in-trust loan-to-value ratio of 75.1%. That gives it the second-lowest leverage among the 401 CMBS 2.0 conduit transactions that KBRA has rated since 2012, the rating agency said.
Sellers to the pool include Bank of America, JPMorgan Chase Bank and Morgan Stanley Mortgage Capital Holdings.
Bank of America Merrill Lynch is on the deal as manager, along with J.P. Morgan Securities, Morgan Stanley and Wells Fargo Securities, according to Asset Securitization Report's deal database.
Coupons, initially, were expected to pay coupons between 4.38% on the notes rated AAA from KBRA, S&P Global Ratings and Fitch Ratings to 5.94% on the notes rates A- and A from Fitch and KBRA, respectively, according to the database.
