KBRA Downgrades Two Ratings of WFCM 2015-NXS2 to D (sf) Following Realization of Principal Losses
20 May 2025 | New York
KBRA downgrades the ratings of the Class F and Class X-F certificates to D (sf) from C (sf) for WFCM 2015-NXS2, a CMBS conduit transaction, following realized losses incurred on the Class F and the reduction in nominal balance of the Class X-F as a result of the loss on Class F. As of the May 2025 remittance period, Class F has incurred $4.1 million in realized losses (22.4% of the original certificate balance). The losses resulted from principal and interest advances that were deemed non-recoverable by the servicer, primarily from the 70 Broad Street asset (fifth largest, 4.6% of the pool).
There are $33.8 million in cumulative principal losses on the transaction according to the May 2025 remittance report. Class G has been reduced to zero from a combination of realized losses from liquidation of assets as well as the non-recoverability determination of servicer advances. Of the cumulative losses to date, reimbursement of non-recoverable advances from principal total $5.0 million. The reimbursement is attributable to the 70 Broad Asset, a non-recoverable REO asset. Along with the non-recoverable advances, the transaction has incurred losses from the liquidation of five previously specially serviced assets: Colman Building ($14.6 million loss, December 2024 liquidation), Noblestown and Mt. Lebanon Portfolio ($6.9 million, May 2024), Shopko Green Bay ($4.7 million, March 2022), Fairfield Inn & Suites Mt. Vernon ($2.5 million, June 2023), and Patriots Park ($903,000, October 2019).
KBRA's other outstanding transaction ratings are unchanged at this time.
Details concerning the classes with ratings changes are as follows:
- Class F to D (sf) from C (sf)
- Class X-F to D (sf) from C (sf)
Rating Sensitivities
Future rating actions will be dependent upon the ongoing assessment of the likelihood of ultimate payment of principal and accrued interest on the rated securities. The assessment will consider the expected and actual losses on the remaining assets in the transaction, as well as the magnitude and extent of interest shortfalls, if any, on the certificates.
For additional details, please see the WFCM 2015-NXS2 August 2024 Surveillance Report linked below.
To access ratings and relevant documents, click here.