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KBRA Affirms All Ratings for ACREC 2025-FL3

27 Jan 2026   |   New York

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KBRA affirms all of its outstanding ratings for ACREC 2025-FL3, a CRE CLO transaction with the ability to reinvest principal proceeds for 30 months that included a six-month ramp-up period. The affirmations follow a surveillance review of the transaction, which has exhibited stable transaction performance since securitization.

At the time of this review, the total collateral balance is $1.1 billion, which is comprised of 26 first mortgage loans secured by 27 properties, and $10.4 million of cash collateral. At issuance, the transaction included $107.6 million of cash collateral for the anticipated acquisition of three pre-identified assets, and $116.4 million of cash collateral for additional ramp collateral. During the reinvestment period, cash collateral and principal proceeds can be used for the acquisition of previously unidentified whole loans and senior pari passu participation interests, and funded companion participations related to existing assets, subject to satisfaction of the eligibility criteria. The ramp-up completion date occurred in July 2025 after the designated funds were utilized to acquire three pre-identified assets, three unidentified assets, and $1.8 million of senior participations related to three loans; $2.7 million of unused ramp proceeds were contributed to the reinvestment account, in accordance with the loan documents.

As of the January 2026 remittance period, there are no delinquent or defaulted loans, and no loans have been identified as K-LOCs. The transaction’s WA KLTV is 116.6%, compared to 119.1% at securitization. The KDSC at Index Cap is 1.02x, compared to 1.04x at securitization. The overcollateralization and interest coverage tests have each been satisfied during each distribution date since issuance.

At securitization, nine loans (38.0% of the pool balance) had related companion participations representing unfunded future advance obligations, with an aggregate unfunded amount of $21.2 million. Currently, there are 11 loans (42.2%), with unfunded future advance obligations with an aggregate of $25.1 million unfunded.

To access ratings and relevant documents, click here.

Click here to view the report.

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Disclosures

Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

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