Kroll Bond Rating Agency UK has assigned preliminary ratings to five classes of notes in UK Logistics 2026-2 DAC, structured as a single-borrower commercial mortgage-backed securities transaction.
The transaction is backed by a £648.8 million limited recourse, first lien mortgage loan originated by Barclays Bank PLC in June 2026, carrying a floating rate.
The loan carries an initial two-year term and includes three one-year extension options, providing the borrower with significant flexibility over its repayment timeline.
Security for the loan comprises freehold interests in 159 assets and long leasehold interests in 25 assets, forming a portfolio of 184 industrial properties across the UK.
The portfolio spans approximately 9.5 million square feet and comprises around 1,960 individual units, representing a substantial slice of UK industrial real estate.
Geographic concentrations within the portfolio are heaviest in the North, Midlands, and Scotland, accounting for 44.9%, 17.6%, and 16.9% of allocated loan amount respectively.
As of December 2025, the portfolio was 91.7% leased to approximately 1,700 unique tenants, including multinational, regional, and local firms across a variety of sectors.
KBRA analysed the transaction primarily using its European CMBS Rating Methodology, evaluating the underlying collateral properties’ financial and operating performance throughout the process.
That analysis was used to determine KBRA’s estimate of sustainable net cash flow and KBRA value, with capitalisation rates applied to each asset’s net cash flow figure.
On an aggregate basis, KBRA’s derived values came in 36.5% lower than the third-party aggregate value for the portfolio, a significant discount reflecting the agency’s conservative underwriting approach.
The securitised loan carries a KBRA loan-to-value ratio of 102.4%, indicating the outstanding debt exceeds KBRA’s assessed collateral value at the time of rating assignment.
Kroll Bond Rating Agency UK Limited is registered as a credit rating agency with the UK Financial Conduct Authority, and this rating has been endorsed by Kroll Bond Rating Agency Europe Limited for use in the European Union.