Morgan Stanley is starting afresh, with a $765.3 million CMBS deal issued through its MSC 2021 trust that comprises 43 loans secured by 60 properties and originated in April 2021 or later, as the vaccination rate gained momentum and Covid infection rate declined.
KBRA notes in a recent pre-sale report that the issuer indicated none of the borrowers had requested forbearance, debt service relief or loan modifications, and all the loans are current on their debt-service payments or have a first payment date by Aug. 2021
“Additionally, all of the loans in the pool were originated in April 2021 or later, so none of the loans were originated prior to the onset of the pandemic,” KBRA says.
The rating agency notes that the overall pool has a weighted average in-trust KBRA-calculated loan-to-value (KLTV) of 95.0%, which is lower than the 98.3% average of the 12 CMBS conduits it has rated over the past six months. In addition, the pool’s exposure to loans with KLTVs in excess of 100% — 20 loans, or 41.6% — is the lowest among the comparison set, which averaged 61.8%.
Morgan Stanley completed a $726 million CMBS deal through the same trust in late April, comprising 60 loans secured by 125 properties. Morgan Stanley was structuring lead on the deal, with Barclays Bank and KeyBank acting as joint leads.
The current deal’s properties are located in 27 metropolitan statistical areas (MSAs) — the top five being New York, Pittsburgh, Los Angeles, Austin and Dallas-Fort Worth, according to KBRA.
“KBRA views diversity relative to property type favorably, and this transaction has exposure to most major property-type segments, with the top three being retail (30.0%), office (23.3%0, and mixed use (14.7%),” the rating agency said.
The deal’s 43-loan count was below the comparison group’s average of 53, and its 61 properties was far below the comparison group’s average of 105, as well as the property-number averages for the past four years.
