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KBRA Downgrades Two Ratings and Affirms All Other Ratings for WFRBS 2014-C20

8 Aug 2025   |   New York

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KBRA downgrades the ratings of two classes of certificates and affirms all other outstanding ratings for WFRBS 2014-C20, a $172.0 million CMBS conduit transaction, which has six specially serviced assets remaining in the underlying mortgage pool. All six specially serviced asset have been determined to be non-recoverable by the servicer. The rating actions follow a surveillance review of the transaction and are based on the performance and expected recovery of the transaction's six remaining assets. Additionally, all outstanding classes of certificates have been impacted by interest shortfalls, primarily due to non-recoverable interest from the trust’s specially serviced assets.

As of the July 2025 remittance period, the six specially serviced assets comprise three matured non-performing loans (59.3% of the pool balance), one REO property (33.4%), and two assets in foreclosure (7.4%). KBRA identified all six assets as K-LOCs. Of the K-LOCs, five (82.5%) have estimated losses. The details of the remaining assets are outlined below.

Sugar Creek I & II (largest, 33.4%, K-LOC, Specially Serviced, REO)

  • The asset comprises two adjacent Class-A, suburban office properties totaling 409,168 sf that are located in Sugar Land, Texas, approximately 20 miles southwest of the Houston CBD.
  • KBRA maintains the asset’s K-LOC designation and KPO of Underperform based on its REO status. The asset transferred to the special servicer in October 2020 due to pandemic-related distress and the trust acquired title to the property in February 2023. According to the March 2025 rent roll, the property was 36.1% leased and servicer commentary from July 2025 indicated the asset was expected to be sold in Q4 2025.
  • The servicer-reported occupancies and DSCs are: 55.0% / 0.71x (FY 2024), 55.0% / 0.70x (FY 2023); at issuance these were 95.0% / 1.52x. An updated appraisal dated October 2024 valued the property at $25.2 million ($62 per sf), which is 69.8% below the $83.5 million ($204 per sf) appraisal value at issuance. The asset carries an ARA of $38.9 million, resulting in a cumulative ASER of $2.9 million. The asset was determined to be non-recoverable by the servicer in July 2024, resulting in cumulative non-recoverable interest of $3.0 million. KBRA’s analysis resulted in an estimated loss of $41.5 million (72.3% estimated loss severity) on the $57.4 million outstanding balance. The estimated loss is based on a KBRA liquidation value of $18.9 million ($46 per sf), which is equal to 75.0% of the most recent appraisal.

Worldgate Centre (2nd largest, 30.1%, K-LOC, Specially Serviced, Matured Non-Performing)

  • The loan is collateralized by a 229,326 sf anchored retail center located in Herndon, Virginia, approximately 24 miles northwest of Washington, DC.
  • KBRA maintains the loan’s K-LOC designation and KPO of Underperform based on its maturity default and its status with the special servicer. The loan transferred to the special servicer in January 2024, concurrent with an extension request by the borrower prior to loan maturity in May 2024. In July 2024, the servicer and borrower agreed to a forbearance agreement through July 2026; however, the loan went into payment default in December 2024 and the borrower communicated interest in receivership and consensual foreclosure. As of the current review, the servicer was in the process of installing a receiver for the property. According to the March 2025 rent roll, the property was 99.6% occupied, but only 53.6% leased when accounting for a sponsor-affiliated tenant that operates an athletic gym at the property.
  • The servicer-reported occupancies and DSCs are: 100% / 0.77x (FY 2024), 100% / 0.64x (FY 2023); at issuance these were 95.0% / 1.30x. An appraisal dated October 2024 valued the property at $26.0 million ($113 per sf), which is 70.6% below the $88.5 million ($386 per sf) appraisal value at issuance. Although the loan has an ARA of $28.1 million, there is no ASER associated with the loan. The asset was determined to be non-recoverable by the servicer in March 2025, resulting in cumulative non-recoverable interest of $1.0 million. KBRA’s analysis resulted in an estimated loss of $33.6 million (64.8% estimated loss severity) on the $51.9 million loan balance. The estimated loss is based on a KBRA value of $20.4 million ($89 per sf), which is derived from an income capitalization approach using KNCF of $2.0 million and a capitalization rate of 9.75%.

Savoy Retail & 60th Street Residential (3rd largest, 17.5%, K-LOC, Specially Serviced, Matured Non-Performing)

  • The loan is collateralized by a retail condominium totaling 47,896 sf, which is located within the Savoy Residential Condominium Tower, and four adjacent four-story multifamily buildings with a total of 24 units (14,744 sf) and 8,625 sf of commercial space. The assets are located within the Upper East Side neighborhood of New York City's borough of Manhattan.
  • KBRA maintains the loan’s K-LOC designation and KPO of Underperform based on its status with the special servicer. The loan transferred to the special servicer in June 2023 due to imminent default relating to the borrower’s request for a loan modification ahead of the loan’s March 2024 maturity date. The borrower and servicer have been unable to agree to terms for a loan modification, and the servicer filed for the appointment of a receiver in November 2024 and initiated foreclosure proceedings. The servicer's workout strategy is to dual-track foreclosure with negotiations with the borrower. According to the June 2024 rent roll and additional servicer updates, the retail portion of the collateral was 64.1% leased and the multifamily units were 95.7% leased.
  • The servicer-reported occupancies and DSCs are: 54.0% / -0.33x (YTD September 2024), 58.0% / 0.36x (FY 2022); at issuance these were 98.2% / 1.74x. An appraisal dated November 2024 valued the property at $65.3 million ($915 per sf), which was 29.8% below the $93.0 million ($1,303 per sf) appraisal value at issuance. The asset was determined to be non-recoverable by the servicer in October 2024, resulting in cumulative non-recoverable interest of $1.0 million. At this time, KBRA does not estimate a loss on the $30.1 million loan balance.

Woodmont Plaza (4th largest, 11.6%, K-LOC, Specially Serviced, Matured Non-Performing)

  • The loan is collateralized by a 135,389 sf suburban office building located in Bethesda, Maryland, approximately 10 miles north of Washington, DC.
  • KBRA identifies the loan as a K-LOC and maintains the loan’s KPO of Underperform based on the loan’s transfer to the special servicer in April 2024 due to maturity default. According to the December 2024 rent roll, the property was 66.0% leased and leases representing 33.7% of total base rent are scheduled to expire through YE 2026. As of the current review, the servicer was working with the borrower toward the appointment of a receiver.
  • The servicer-reported occupancies and DSCs are: 66.0% / 1.43x (FY 2024), 57.0% / 1.31x (FY 2023); at issuance these were 88.1% / 2.33x. An updated February 2025 appraisal valued the property at $11.3 million ($83 per sf), which is 71.8% below the $40.0 million ($295 per sf) appraisal value at issuance. An ARA of $10.4 million was effectuated for the loan in March 2025, resulting in a cumulative ASER of $31,300. The loan was determined by the servicer to be non-recoverable in February 2025, resulting in cumulative non-recoverable interest of $597,000. KBRA’s analysis resulted in an estimated loss of $12.6 million (62.8% estimated loss severity) on the $20.0 million loan balance. The estimated loss is based on a KBRA liquidation value of $9.0 million ($67 per sf).

The remaining two assets account for 9.3% of the pool balance:

  • Town Park Office (5th largest, 5.8%, Foreclosure) is collateralized by a four-story, 145,998 sf suburban office property located in Kennesaw, Georgia, approximately 25 miles north of Atlanta. KBRA maintains the loan’s K-LOC designation based on its transfer to the special servicer in June 2023 for imminent monetary default ahead of the loan’s January 2024 maturity. The servicer initiated foreclosure proceedings after a three-month post-maturity forbearance period. The loan was deemed non-recoverable in October 2024, resulting in cumulative non-recoverable interest of $388,000. KBRA’s analysis resulted in an estimated loss of $4.0 million (40.7% estimated loss severity) on the $9.9 million loan balance. The estimated loss was based on a KBRA liquidation value of $7.1 million ($48 per sf).
  • Winn Dixie Baton Rouge (6th largest, 1.6%, Foreclosure) is collateralized by 50,388 sf grocery anchor box for a retail shopping center in Baton Rouge, Louisiana. The property’s single tenant is Shopper’s Value, which has a lease expiration date in December 2025. According to servicer commentary, foreclosure proceedings have been initiated. The loan was deemed non-recoverable in October 2024, resulting in cumulative non-recoverable interest of $104,000. KBRA’s analysis resulted in an estimated loss of $744,000 (27.6% estimated loss severity) on the $2.7 million loan balance. The estimated loss was based on a KBRA liquidation value of $2.3 million ($45 per sf).

Details concerning the classes with rating changes are as follows:

  • Class B to B- (sf) from BB- (sf)
  • Class C to C (sf) from CC (sf)

Rating Sensitivities

To access ratings and relevant documents, click here.

Related Publication

Methodologies

Disclosures

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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