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KBRA Downgrades Five Ratings and Affirms All Other Ratings for WFCM 2016-BNK1

1 Aug 2025   |   New York

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KBRA downgrades the ratings of five classes of certificates and affirms all other outstanding ratings of WFCM 2016-BNK1, a $772.7 million CMBS conduit transaction. The rating actions follow a surveillance review of the transaction, which has exhibited an increase in estimated losses since KBRA's last ratings change in August 2024. The estimated losses are from five K-LOCs (25.1% of the pool balance), all of which are among the top ten loans.

As of the July 2025 remittance period, there are two specially serviced assets (11.8%) including one asset (7.2%) that is REO and one (4.6%) that is 30+ days delinquent. KBRA has identified nine loans (33.4%) as K-LOCs, including the specially serviced assets. Of the nine K-LOCs, five (25.1%) have estimated losses. The K-LOCs are depicted on the table below:

K-LOCs Loss Given Default (000s) Loss Severity 3 One Stamford Forum OF 55,522 7.2% Y 90+ N Specially Serviced 04/10/2019 $41,858 75.4% 5 Pinnacle II OF 40,000 5.2% N C N Occupancy 05/04/2022 $20,304 50.8% 6 Brewers Hill MU 35,690 4.6% Y 30+ N Specially Serviced 07/29/2020 $19,935 55.9% 11 633 Third Avenue - Retail Condo RT 32,000 4.1% N C N DSCR 11/12/2024 $7,250 22.7% 7 Simon Premium Outlets RT 30,796 4.0% N C N Occupancy 03/06/2025 $4,968 16.1% 12 Riverside University Village RT 22,458 2.9% N C N DSCR 11/06/2024 - - 17 Courtyard Marriott - Baldwin Park LO 16,041 2.1% N C Y DSCR 09/08/2020 - - 19 Corporate Center at Kierland OF 14,246 1.8% N C N Lease Rollover 11/05/2021 - - 21 Southland Terrace Shopping Center RT 11,635 1.5% N C N Occupancy 12/08/2016 - - Total K-LOCs $258,389 33.4% $94,316 1. K-LOC Date is the date when the most recent K-LOC was initially determined. 2. Loss Given Default assumes a 100% probability of default (PD). KBRA may determine a lower PD when estimating losses to a transaction. KBRA Estimated 2 Prosp. ID Loan Name Prop Type Current In-Trust Balance (000s) % of Deal Balance SS Loan Status Mod (Y/N) Primary K-LOC Reason K-LOC Date 1
Source: KBRA

Excluding the K-LOCs with estimated losses, the transaction’s WA KLTV is 75.9%, compared to 82.1% at KBRA's last ratings change and 91.7% at securitization. The KDSC is 2.26x, compared to 2.16x at KBRA's last ratings change and 2.13x securitization.

Details concerning the classes with rating changes are as follows:

  • Class C to B- (sf) from BBB- (sf)
  • Class D to CC (sf) from CCC (sf)
  • Class E to C (sf) from CC (sf)
  • Class X-D to CC (sf) from CCC (sf)
  • Class X-E to C (sf) from CC (sf)

To access ratings and relevant documents, click here.

Click here to view the report.

Related Publication

Methodologies

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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