KBRA Upgrades Five Ratings and Affirms Two Ratings for MHC Commercial Mortgage Trust 2021-MHC
18 Apr 2025 | New York
KBRA upgrades the ratings for five classes of certificates and affirms all of its other outstanding ratings for MHC Commercial Mortgage Trust 2021-MHC, a $1.14 billion CMBS single borrower transaction. The rating actions follow a surveillance review of the transaction, which has exhibited improved performance since securitization as evidenced by higher KNCF and lower KLTV.
At issuance, the collateral was the borrowers’ fee simple interests in 124 manufactured housing communities (MHCs) totaling 29,086 pads and 771 RV sites located across 13 states. Since issuance, 61 properties have been released. The current collateral is the borrowers’ fee simple interests in 63 MHCs totaling 15,672 pads and 765 RV sites located across nine states. The floating-rate loan was structured with an initial two-year term with three one-year extension options. In association with the first extension option executed effective April 9, 2023, the interest rate benchmark was converted to one-month term SOFR. The second extension option was executed April 9, 2024. The third extension was executed April 9, 2025, and a new interest rate cap agreement was obtained with a strike rate of 5.02%. The loan requires monthly interest-only payments based on one-month SOFR plus the initial spread of 1.89% and a 0.11% adjusted SOFR replacement spread.
KBRA analyzed the cash flow for the properties utilizing information from the trustee and servicer to determine KNCF. The analysis produced a KNCF of $81.3 million and a KBRA value of $1.02 billion ($65,076 per pad), representing a 12.8% increase per pad from securitization, net of property releases. The resulting in-trust KLTV is 112.2% compared to 123.7% at last review and 132.8% at securitization. KBRA maintains a KPO of Perform for the loan.
Details concerning the classes with rating changes are as follows:
- Class C to AAA (sf) from AA+ (sf)
- Class D to AA (sf) from A (sf)
- Class E to BBB+ (sf) from BBB- (sf)
- Class F to BB+ (sf) from BB- (sf)
- Class G to B+ (sf) from B- (sf)
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