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KBRA Downgrades Three Ratings and Affirms All Other Ratings for JPMCC 2017-JP5

7 Mar 2025   |   New York

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KBRA downgrades the ratings of three classes of certificates and affirms all other outstanding ratings of JPMCC 2017-JP5,a $761.1 million CMBS conduit transaction. The rating actions follow a surveillance review of the transaction, which has exhibited a worsening in pool performance since KBRA's last rating action in March 2024, including an increase in KBRA's estimated losses for five K-LOCs (28.0% of the pool balance).

As of the February 2025 remittance period, there are three specially serviced assets (13.2%), of which one is REO (0.9%),one is in foreclosure (7.4%) and one is performing matured (5.0%). KBRA identified eight K-LOCs (33.5%), including the specially serviced assets. These include:

Five of the top 10 loans (31.5%):

  • 55 Hawthorne (4th largest, 8.1% of the pool balance, 16.9% loss severity)
  • Riverway (5th largest, 7.4%, 26.9%)
  • Landmark Square (6th largest, 6.7%, 7.5%)
  • Reston EastPointe (8th largest, 5.0%, 39.8%)
  • Centre Market Building (9th largest, 4.4%)

One other K-LOC (0.9%) has an estimated loss:

  • Montgomery Triangle Gateway (0.9%, 50.7%)

The remaining two K-LOCs do not have estimated losses and represent 1.1% of the pool balance.

Excluding K-LOCs with estimated losses, the transaction’s WA KLTV is 79.4% compared to 92.6% at last review and 96.8%at securitization. The KDSC is 2.05x compared to 1.99x at last review and 1.82x at securitization.

Details concerning the classes with rating changes are as follows:

Class D-RR to B- (sf) from BB- (sf)

Class E-RR to CC (sf) from CCC (sf)

Class F-RR to C (sf) from CC (sf)

To access ratings and relevant documents, click here.

Click here to view the report.

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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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