/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/250108.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Wednesday, January 8, 2025, Vol. 26, No. 6 Headlines F R A N C E ALTICE FRANCE: EUR1BB Bank Debt Trades at 16% Discount L U X E M B O U R G ALTICE FINANCING: $1.60BB Bank Debt Trades at 16% Discount ALTICE FINANCING: EUR400MM Bank Debt Trades at 16% Discount ALTISOURCE: Fails to Meet Nasdaq Bid Price Rule N E T H E R L A N D S JUBILEE PLACE 4: DBRS Hikes Class E Notes Rating to B(high) S P A I N GERIAVI SL: EUR100MM Bank Debt Trades at 27% Discount SANTANDER CONSUMO 4: DBRS Confirms BB(low) Rating on Series E Notes SANTANDER CONSUMO 6: DBRS Puts 'BB' Cl. E Notes Rating Under Review U N I T E D K I N G D O M ANDREWS MARQUEES: South West & Wales Named as Administrators ECS CAPITAL: CG & Co Named as Joint Administrators MARCHANTCAIN DESIGN: Leonard Curtis Named as Joint Administrators PLATFORM NINE: Quantuma Advisory Named as Administrators SALUS DAC: DBRS Cuts Class D Notes Rating to BB(low) - - - - - =========== F R A N C E =========== ALTICE FRANCE: EUR1BB Bank Debt Trades at 16% Discount ------------------------------------------------------ Participations in a syndicated loan under which Altice France SA is a borrower were trading in the secondary market around 83.8 cents-on-the-dollar during the week ended Friday, January 3, 2025, according to Bloomberg's Evaluated Pricing service data. The EUR1 billion Term loan facility is scheduled to mature on February 2, 2026. About EUR237 million of the loan has been drawn and outstanding. Altice France provides wireless telecommunication services. The Company offers fiber optic network solutions for all type of media. Altice France serves customers in France. =================== L U X E M B O U R G =================== ALTICE FINANCING: $1.60BB Bank Debt Trades at 16% Discount ---------------------------------------------------------- Participations in a syndicated loan under which Altice Financing SA is a borrower were trading in the secondary market around 83.9 cents-on-the-dollar during the week ended Friday, January 3, 2025, according to Bloomberg's Evaluated Pricing service data. The $1.60 billion Term loan facility is scheduled to mature on October 29, 2027. The amount is fully drawn and outstanding. Altice International S.a.r.l. is a multinational fibre, telecommunications, content and media company, with a presence in three key markets: Portugal, the Dominican Republic and Israel. The company also operates globally through Teads, a media platform. The Company's country of domicile is Luxembourg. ALTICE FINANCING: EUR400MM Bank Debt Trades at 16% Discount ----------------------------------------------------------- Participations in a syndicated loan under which Altice Financing SA is a borrower were trading in the secondary market around 83.8 cents-on-the-dollar during the week ended Friday, January 3, 2025, according to Bloomberg's Evaluated Pricing service data. The EUR400 million Term loan facility is scheduled to mature on October 29, 2027. The amount is fully drawn and outstanding. Altice International S.a.r.l. is a multinational fibre, telecommunications, content and media company, with a presence in three key markets: Portugal, the Dominican Republic and Israel. The company also operates globally through Teads, a media platform. The Company's country of domicile is Luxembourg. ALTISOURCE: Fails to Meet Nasdaq Bid Price Rule ----------------------------------------------- Altisource Portfolio Solutions S.A. disclosed in a Form 8-K Report filed with the U.S. Securities and Exchange Commission that it received a letter from The Nasdaq Stock Market notifying the Company that, because the closing bid price for its common stock has been below $1.00 per share for 30 consecutive business days prior to December 19, 2024, it no longer complies with the minimum bid price requirement for continued listing on The Nasdaq Global Select Market. Nasdaq Listing Rule 5450(a)(1) requires listed securities to maintain a minimum bid price of $1.00 per share (the "Minimum Bid Price Rule"), and Nasdaq Listing Rule 5810(c)(3)(A) provides that a failure to meet the Minimum Bid Price Rule exists if the deficiency continues for a period of 30 consecutive business days. Pursuant to Nasdaq Listing Rule 5810(c)(3)(A), the Company has been provided an initial compliance period of 180 calendar days, or until June 17, 2025, to regain compliance with the Minimum Bid Price Rule. The Bid Price Notice states that the Nasdaq staff will provide written confirmation that the Company has achieved compliance with the Minimum Bid Price Rule if at any time before June 17, 2025, the bid price of the Company's common stock closes at $1.00 per share or more for a minimum of ten consecutive business days. In the event the Company is not in compliance with the Minimum Bid Price Rule by June 17, 2025, the Company may be afforded a second 180 calendar day grace period. To qualify, the Company must submit an application to transfer the listing of its common stock to The Nasdaq Capital Market, which requires the Company meet the continued listing requirement for the market value of publicly held shares and all other initial listing standards for The Nasdaq Capital Market, other than the Minimum Bid Price Rule. The Company would also need to pay an application fee to Nasdaq and to provide written notice of its intention to cure the minimum bid price deficiency during this second 180-day compliance period by effecting a reverse stock split, if necessary. As part of its review process, Nasdaq will make a determination of whether it believes the Company will be able to cure this deficiency. Should the Nasdaq staff conclude that the Company will not be able to cure the deficiency, or should the Company determine not to submit a transfer application or make the required representation, Nasdaq will provide notice that the Company's common stock will be subject to delisting, which the Company could appeal. In addition, on December 20, 2024, the Company received written notice from Nasdaq indicating that, for the 30 consecutive business days ending December 19, 2024, the market value of the Company's publicly held shares was below the minimum requirement of $15 million for continued listing on The Nasdaq Global Select Market under Nasdaq Listing Rule 5450(b)(3)(C). In accordance with Nasdaq Listing Rule 5810(c)(3)(D), the Company has been provided a period of 180 calendar days, or until June 18, 2025, to regain compliance. The Market Value Notice states that, if during the 180-day compliance period, the Company's MVPHS closes at $15 million or more for a minimum of ten consecutive business days, the Nasdaq staff will provide written confirmation of compliance and this matter will be closed. If the Company does not regain compliance with the MVPHS Rule by June 18, 2025, the Company will receive written notification that its securities are subject to delisting. In the event the Company receives any such notification, the Company may appeal the Nasdaq's staff determination to delist its securities, but there can be no assurance the Nasdaq staff would grant any request for continued listing. Alternatively, the Company could consider applying to transfer its common stock to The Nasdaq Capital Market. In order to transfer, the Company must submit an application to transfer the listing of its common stock to The Nasdaq Capital Market, pay an application fee and meet The Nasdaq Capital Market's continued listing requirements. The Notices have no immediate effect on the listing of the Company's common stock on The Nasdaq Global Select Market. During the 180-day compliance periods, the Company's common stock will continue to be listed and traded on The Nasdaq Global Select Market. The Company intends to actively monitor the bid price of its common stock and its MVPHS between now and the end of each applicable compliance period and will consider available options to regain compliance with the Minimum Bid Price Rule by June 17, 2025, and the MVPHS Rule by June 18, 2025. There can be no assurance that the Company will be able to regain compliance with the Minimum Bid Price Rule or the MVPHS Rule or that the Company will otherwise be in compliance with the other listing standards for The Nasdaq Global Select Market. About Altisource Headquartered in Luxembourg, Altisource Portfolio Solutions S.A. -- https://www.Altisource.com/ -- is an integrated service provider and marketplace for the real estate and mortgage industries. Combining operational excellence with a suite of innovative services and technologies, Altisource helps solve the demands of the ever-changing markets it serves. As of September 30, 2024, Altisource had $144.5 million in total assets, $293.2 million total liabilities, and $148.7 million in total deficit. * * * Egan-Jones Ratings Company, on September 27, 2024, downgraded the foreign currency and local currency senior unsecured ratings on debt issued by Altisource Portfolio Solutions S.A. to CCC from CCC+. In December 2024, S&P Global Ratings lowered its issuer credit rating on Altisource Portfolio Solutions S.A. to 'CC' from 'CCC+' and its issue rating on the senior secured term loan to 'C' from 'CCC-'. ===================== N E T H E R L A N D S ===================== JUBILEE PLACE 4: DBRS Hikes Class E Notes Rating to B(high) ----------------------------------------------------------- DBRS Ratings GmbH upgraded and confirmed its credit ratings on the loans and notes issued by Jubilee Place 4 B.V. (JP4), Jubilee Place 5 B.V. (JP5), and Jubilee Place 6 B.V. (JP6) (together the Issuers), as follow: JP4 -- Class A loan confirmed at AAA (sf) -- Class B notes upgraded to AA (high) (sf) from AA (low) (sf) -- Class C notes upgraded to A (high) (sf) from A (low) (sf) -- Class D notes upgraded to A (low) (sf) from BBB (sf) -- Class E notes upgraded to B (high) (sf) from B (sf) JP5 -- Class A loan confirmed at AAA (sf) -- Class B notes upgraded to AA (high) (sf) from AA (sf) -- Class C notes upgraded to A (high) (sf) from A (sf) -- Class D notes upgraded to A (sf) from BBB (high) (sf) -- Class E notes upgraded to A (low) (sf) from BB (high) (sf) -- Class F notes upgraded to BB (high) (sf) from BB (low) (sf) JP6 -- Class A loan confirmed at AAA (sf) -- Class B notes upgraded to AA (high) (sf) from AA (low) (sf) -- Class C notes confirmed at A (high) (sf) -- Class D notes upgraded to A (sf) from BBB (high) (sf) -- Class E notes confirmed at BB (high) (sf) -- Class X1 notes confirmed at BBB (sf) Morningstar DBRS also removed the Under Review with Positive Implications (UR-Pos.) status from all classes of notes where they were placed on 17 September 2024, except for Class A loans already rated AAA (sf). The credit ratings on the Class A loans in all three transactions address the timely payment of interest and the ultimate payment of principal by the respective legal final maturity dates between 2059 and 2060. The credit ratings on the Class B notes in all three transactions address the timely payment of interest when most senior and the ultimate payment of principal by the respective legal final maturity dates. The credit ratings on the remaining classes of notes address the ultimate payment of interest and the ultimate repayment of principal on or before the respective final maturity dates. CREDIT RATING RATIONALE The credit rating actions resulted from full transaction reviews following Morningstar DBRS' finalization of its "European RMBS Insight: Dutch Addendum" on 11 September 2024, subsequently included as Appendix 6 -- Dutch Addendum to its "European RMBS Insight Methodology" as of December 3, 2024. The credit rating actions conclude the under-review period for the transactions, which began on September 17, 2024. The Methodology presents the criteria for which Dutch RMBS credit ratings and, where relevant, Dutch covered bonds credit ratings, are assigned and/or monitored. The changes to the methodology include a revised Dutch Loan Scoring Approach, updated house price data, market value declines, and distressed sale discounts, as well as revised rescission rates. In addition to the material changes introduced in the methodology, the credit rating actions are based on the following analytical considerations: -- Portfolio performances, in terms of delinquencies, defaults, and losses, as of the September and October 2024 payment dates; -- Portfolio default rates (PD), loss given default (LGD), and expected loss assumptions on the remaining pools of receivables; and -- Current available credit enhancements to the rated loans and notes to cover the expected losses at their respective credit rating levels. The transactions are bankruptcy-remote special-purpose vehicles incorporated in the Netherlands. The Issuers used the proceeds from the Class A loans and issued notes to fund the purchase of Dutch mortgage receivables originated by Dutch Mortgage Services B.V., DNL 1 B.V., and Community Hypotheken B.V. (the Originators) and acquired from Citibank N.A./London Branch. The Originators are specialized residential buy-to-let real estate lenders operating in the Netherlands and started their lending businesses in 2019. They operate under the mandate of Citibank, N.A., which defines most of the underwriting criteria and policies. PORTFOLIO PERFORMANCE As of the latest respective payment dates, loans up to three months in arrears represented 1.2% (JP4), 0.2% (JP5), and 0.3% (JP6) of the outstanding portfolio balances. The 90+ days delinquency ratio and the cumulative default ratio both remained at 0.00% for all three transactions. PORTFOLIO ASSUMPTIONS AND KEY DRIVERS Morningstar DBRS conducted a loan-by-loan analysis of the remaining pools of receivables of each transaction and updated its base case PD and LGD assumptions as follows: JP4: The base case PD and LGD assumptions on the current pool of receivables are 3.8% and 14.1%, respectively. JP5: The base case PD and LGD assumptions on the current pool of receivables are 3.4% and 14.0%, respectively. JP6: The base case PD and LGD assumptions on the current pool of receivables are 3.9% and 11.7%, respectively. CREDIT ENHANCEMENT Credit enhancements to the rated loans and notes are provided in the form of subordination of junior-ranking notes. The credit enhancements continue to build up in line with the amortization of the notes. The transactions benefit from amortizing liquidity reserve funds (LRF) that can be used to cover shortfalls on senior expenses and interest payments on the Class A loans, liquidity support to the Class B notes once most senior, and also indirectly provide credit enhancement to the Class A loans and all other classes of notes, as released amounts are part of the principal available funds. As of the latest payment dates, the LRFs in each transaction were at their respective target levels of 2,922,384 (JP4), 4,064,466 (JP5), and 3,038,050 (JP6). Citibank Europe plc - Netherlands Branch acts as the account bank for the Issuers. Based on Morningstar DBRS' private credit rating on the account bank provider, the downgrade provisions outlined in the transactions documents, and other mitigating factors inherent in the transactions' structures, Morningstar DBRS considers the risk arising from the exposure to the account bank to be consistent with the AAA (sf) credit rating assigned to the Class A loans, as described in Morningstar DBRS' "Legal and Derivative Criteria for European Structured Finance Transactions" methodology. BNP Paribas SA (in JP4) and Citibank Europe plc (in JP5 and JP6) act as the interest rate swap counterparties for the Issuers. Morningstar DBRS' public Long-Term Issuer Rating of AA (low) on BNP Paribas SA and public Long-Term Issuer Rating of AA (low) on Citibank Europe plc are consistent with the first credit rating threshold as described in Morningstar DBRS' "Legal and Derivative Criteria for European Structured Finance Transactions" methodology. Notes: All figures are in euros unless otherwise noted. ========= S P A I N ========= GERIAVI SL: EUR100MM Bank Debt Trades at 27% Discount ----------------------------------------------------- Participations in a syndicated loan under which GeriaVi SL is a borrower were trading in the secondary market around 72.6 cents-on-the-dollar during the week ended Friday, January 3, 2025, according to Bloomberg's Evaluated Pricing service data. The EUR100 million Term loan facility is scheduled to mature on November 27, 2034. The amount is fully drawn and outstanding. The Company's country of domicile is Spain. SANTANDER CONSUMO 4: DBRS Confirms BB(low) Rating on Series E Notes ------------------------------------------------------------------- DBRS Ratings GmbH confirmed its credit ratings on the following series of notes (collectively, the Rated Notes) issued by FT Santander Consumo 4 (the Issuer): -- Series A Notes at AA (sf) -- Series B Notes at A (high) (sf) -- Series C Notes at A (low) (sf) -- Series D Notes at BBB (low) (sf) -- Series E Notes at BB (low) (sf) The credit rating on the Series A Notes addresses the timely payment of interest and the ultimate payment of principal on or before the legal final maturity date in June 2038. The credit ratings on the Series B, Series C, Series D, and Series E Notes address the ultimate payment of interest and the ultimate payment of principal on or before the legal final maturity date. The confirmations follow an annual review of the transaction and are based on the following analytical considerations: -- The portfolio performance, in terms of delinquencies and defaults, as of the December 2024 payment date; -- Probability of default (PD), loss given default (LGD), and expected loss assumptions on the remaining receivables; and -- Current available credit enhancement to the Rated Notes to cover the expected losses at their respective credit rating levels. The transaction is a securitization collateralized by receivables related to consumer loans granted by Banco Santander SA (Banco Santander; the originator) to private individuals residing in Spain. The originator also services the portfolio. The transaction closed in February 2021 and included an initial 13-month revolving period, which ended on the March 2022 payment date. PORTFOLIO PERFORMANCE As of December 2024, loans that were one to two months and two to three months in arrears represented 0.3% and 0.2% of the outstanding portfolio balance, respectively, while loans more than three months in arrears represented 8.9%. The default ratio amounted to 1.35% of the aggregate initial portfolio balance (including additional receivables purchased during the revolving period). PORTFOLIO ASSUMPTIONS AND KEY DRIVERS Morningstar DBRS updated its base case PD and LGD assumptions to 4.3% and 85.0%, respectively, from 4.9% and 78.7%, based on updated historical performance data of the originator received in the context of its recent securitizations. CREDIT ENHANCEMENT The subordination of the respective junior obligations provides credit enhancement to the Rated Notes. As of the December 2024 payment date, credit enhancement to the Series A, Series B, Series C, Series D, and Series E Notes was 15.8%, 8.8%, 6.0%, 2.9%, and 0.0%, respectively. The credit enhancement levels have remained unchanged since Morningstar DBRS' initial credit ratings due to the continuing pro rata amortization of the Rated Notes following the end of the revolving period. The Rated Notes will continue to pay on a pro rata basis unless certain events such as a breach of performance triggers, a servicer insolvency, or a servicer termination occur. Under these circumstances, the principal repayment of the Rated Notes will become fully sequential and the switch is not reversible. The transaction benefits from an amortizing cash reserve funded through the subscription proceeds of the Series F Notes, which has a target balance equal to 2.0% of the Rated Notes, subject to a floor of EUR 7.5 million. The cash reserve can be used to cover senior costs and interest on the Series A Notes, Series B Notes, Series C Notes, Series D Notes, and Series E Notes. As of the December 2024 payment date, the cash reserve was at its target balance of EUR 7.71 million. Banco Santander acts as the account bank for the transaction. Based on Morningstar DBRS' Long-Term Issuer Rating of A (high) on Banco Santander (one notch below its Long Term Critical Obligations Rating (COR) of AA (low)), the downgrade provisions outlined in the transaction's documents, and other mitigating factors inherent in the transaction's structure, Morningstar DBRS considers the risk arising from the exposure to the account bank to be consistent with the credit ratings assigned to the Rated Notes, as described in Morningstar DBRS' "Legal and Derivative Criteria for European Structured Finance Transactions" methodology. An interest rate swap is in place to hedge fixed-floating interest rate risk, with Banco Santander acting as the swap counterparty. Based on its COR and the collateral posting provisions included in the documentation, Morningstar DBRS considers the risk arising from the swap counterparty to be consistent with the credit ratings assigned to the Rated Notes, in accordance with Morningstar DBRS' "Legal and Derivative Criteria for European Structured Finance Transactions" methodology. Notes: All figures are in euros unless otherwise noted. SANTANDER CONSUMO 6: DBRS Puts 'BB' Cl. E Notes Rating Under Review ------------------------------------------------------------------- DBRS Ratings GmbH placed the credit ratings of four classes of notes issued by Santander Consumo 6 FT Under Review with Negative Implications (UR-Neg.) as follows: -- Class B Notes rated AA (sf) -- Class C Notes rated A (high) (sf) -- Class D Notes rated A (low) (sf) -- Class E Notes rated BB (sf) Morningstar DBRS did not take rating action on the Class A Notes (rated AA (sf)) also issued in the transaction. The credit rating of the Class A Notes addresses the timely payment of scheduled interest and the ultimate repayment of principal by the legal final maturity date. The credit ratings of the Class B Notes, Class C Notes, and the Class D Notes address the ultimate payment of interest (timely when most senior) and the ultimate repayment of principal by the legal final maturity date. The credit rating of the Class E Notes addresses the ultimate payment of interest and the ultimate repayment of principal by the legal final maturity date. The transaction, issued in May 2024, is a securitization of a portfolio of fixed-rate, unsecured, amortizing personal loans granted without a specific purpose to private individuals domiciled in Spain and serviced by Banco Santander SA (Santander). CREDIT RATING RATIONALE The UR-Neg. rating actions follow a review of updated historical collateral performances with a noticeable deterioration in both the historical cumulative defaults and recoveries that were already reflected in the expected default and expected recovery assumptions applied to Santander Consumo 7 FT issued on November 14, 2024. As the transaction's revolving period is scheduled to end on December 21, 2024, Morningstar DBRS considers it is prudent to assess the potential cash flow impact from revised asset assumptions when the transaction´s portfolio becomes static. Notes: All figures are in euros unless otherwise noted. =========================== U N I T E D K I N G D O M =========================== ANDREWS MARQUEES: South West & Wales Named as Administrators ------------------------------------------------------------ Andrews Marquees Limited was placed into administration proceedings in the High Court of Justice Business and Property Courts in Bristol, Insolvency & Companies List (ChD), Court Number: CR-2024-000155, and Rob Coad and Sam Talby of South West & Wales Business Recovery, were appointed as administrators on Dec. 30, 2024. Andrews Marquees specializes in renting and leasing of machinery, equipment and tangible goods. Its registered office and principal trading office is at Unit 2 Dean Road Trading Estate, Dean Road, Bristol, BS11 8AT. The administrators can be reached at: Rob Coad Sam Talby South West & Wales Business Recovery Orchard St Business Centre 13-14 Orchard Street, Bristol BS1 5EH Further Details Contact: Charlie Cooper Email: charlie.cooper@undebt.co.uk ECS CAPITAL: CG & Co Named as Joint Administrators -------------------------------------------------- ECS Capital Limited was placed into administration proceedings in the High Court of Justice Property Courts of England & Wales, Insolvency and Companies List (ChD), Court Number: CR-2025 of 19, and Edward M Avery-Gee and Daniel Richardson of CG & Co were appointed as joint administrators on Jan. 2, 2024. ECS Capital specializes in financial intermediation. Its registered office address and principal trading address is at Stamford Green, 33 Stamford Street, Altrincham, WA14 1ES. The joint administrators can be reached at: Edward M Avery-Gee Daniel Richardson CG & Co 27 Byrom Street, Manchester M3 4PF For further details, contact: Harry Seddon Tel No: 0161 358 0210 Email: info@cg-recovery.com MARCHANTCAIN DESIGN: Leonard Curtis Named as Joint Administrators ----------------------------------------------------------------- Marchantcain Design Limited was placed into administration proceedings in the High Court of Justice Business and Property Courts in Birmingham, Insolvency & Companies List (ChD), Court Number: CR-2024-BHM-000707, and Conrad Beighton and Kirsty Swan of Leonard Curtis, were appointed as joint administrators on Dec. 18, 2024. Marchantcain Design is a design engineering consultancy that provides new mechatronic product design, production lines, and logistics. Its registered office and principal trading office is at 1 Banner Park, Wickmans Drive, Coventry, CV4 9XA. The joint administrators can be reached at: Conrad Beighton Kirsty Swan Leonard Curtis Cavendish House 39-41 Waterloo Street Birmingham, B2 5PP Further Details Contact: The Joint Administrators Tel No: 0121 200 2111 Email: recovery@leonardcurtis.co.uk Alternative contact: Moiz Khan PLATFORM NINE: Quantuma Advisory Named as Administrators -------------------------------------------------------- Platform Nine Ltd was placed into administration proceedings in the High Court of Justice Business and Property Courts of England and Wales Insolvency & Companies List (ChD) Court Number: CR-2024-007682, and Sean Bucknall and Elias Paourou of Quantuma Advisory Limited, were appointed as administrators on Dec. 30, 2024. Platform Nine specializes in letting and operating of conference and exhibition centres. Its registered office is at Preston Park House, South Road, Brighton, BN1 6SB and it is in the process of being changed to 3rd Floor, 37 Frederick Place, Brighton, BN1 4EA. Its principal trading address is at Floor 5 & 6, Tower Point, 44 North Road, Brighton, BN1 1YR. The administrators can be reached at: Sean Bucknall Elias Paourou Quantuma Advisory Limited 3rd Floor, 37 Frederick Place Brighton, BN1 4EA Further Details Contact: Billy Poulton Tel No: 01273 322400 Email: Billy.Poulton@quantuma.com SALUS DAC: DBRS Cuts Class D Notes Rating to BB(low) ---------------------------------------------------- DBRS Ratings Limited took the following credit rating actions on the notes issued by Salus (European Loan Conduit No. 33) DAC (the Issuer): -- Class A downgraded to A (high) (sf) from AA (high) (sf) -- Class B downgraded to BBB (sf) from A (low) (sf) -- Class C downgraded to BB (high) (sf) from BBB (low) (sf) -- Class D downgraded to BB (low) (sf) from BB (sf) The trends on all credit ratings are Negative. CREDIT RATING RATIONALE The credit rating downgrades result from the further increase in Morningstar DBRS' cap rate assumption for the underlying property by 55 basis points (bps) to 6.30% from 5.75% as at Morningstar DBRS' last review of the deal in July 2024. At the time, Morningstar DBRS had already raised its cap rate by 55 bps to 5.75% from 5.20% to reflect the aged property valuation (March 2023), the transaction's reduced tail period, and its refinancing risk. The senior loan's extended maturity into the tail period is approaching on January 20, 2025 and, in Morningstar DBRS' view, the sale of the Citypoint asset is unlikely to take place on schedule, or at least not likely to be executed at a sale price in line with the sponsor's expectations. If the borrower does not manage to refinance or sell the property within loan maturity, the servicer would not be able to grant another 12-month extension without noteholders' consent first. While the improved cash flow metrics of the portfolio might point towards a noteholder-approved restructuring, Morningstar DBRS is of the opinion that the senior loan is highly likely to default at its maturity and, as a result, to be transferred into special servicing. The transaction is a securitization of a GBP 367.5 million floating-rate senior commercial real estate loan that Morgan Stanley & Co. International Plc (Morgan Stanley) advanced in November 2018 to CityPoint Holdings I Ltd., which is controlled by Brookfield Asset Management Inc. (the Sponsor). The senior loan is split into two pari passu facilities: Facility A, which totals GBP 354.0 million, and Facility B (the capital expenditure (capex) facility), which totals GBP 13.5 million. Facility A refinanced the borrower's existing debt, whereas the capex facility financed some refurbishment works that the Sponsor planned at issuance. Additionally, there is a non-securitized mezzanine facility totaling GBP 91.9 million that is contractually and structurally subordinated to the senior facilities. For the purposes of complying with the applicable risk retention requirements, Morgan Stanley also advanced a GBP 18.4 million vertical risk retention (VRR) loan to the issuer. The senior loan is secured by a single asset known as Citypoint, a 36-storey office tower in the City of London originally built for British Petroleum in 1967. The building offers 704,657 square feet (sf) of office space and more than 60,000 sf of retail space, including several restaurants and one of the largest health club in the Square Mile, Nuffield Health. It is one of the largest office buildings in the City of London and underwent a comprehensive reconstruction in 2001. Since then, the owner has maintained the property to a high standard with ongoing refurbishment works and, as such, the building does not show any significant signs of obsolescence. In particular, as part of the Sponsor's business plan to capture the asset's reversionary value potential, during the course of 2020-21, levels five to eight (the podium floors) underwent a comprehensive refurbishment at a cost of around GBP 167 per sf (psf) to provide high-quality Grade A offices and an additional floor area and walkway. Landscaped terraces were also included, and the dedicated podium reception was refurbished. After the refurbishment, there was letting activity on level eight with the execution of a new lease to an already occupying tenant, Squarepoint Capital LLP, that commenced on March 1, 2023. The contracted rent for the new lease is GBP 1.47 million per annum (GBP 59 psf) and the lease commenced on 1 December 2023. More recently, the borrower signed a new lease with Phaidon International (UK) Ltd for the whole level seven, with an annual contracted rent of GBP 2.4 million (GBP 56 psf) and a 10-year term commencing in March 2025. As a result, the building's physical occupancy increased to 88.3% at the October 2024 interest payment date (IPD) from 81.6% as of the July 2024 IPD. Moreover, based on the October 2024 IPD servicer report, Morningstar DBRS understands that terms have been agreed with a new tenant to occupy level six on a 10-year term commencing in April 2025, which would boost occupancy up to 95% upon completion of the lease. Therefore, level five is still the only vacant level in the building, and negotiations are ongoing with potential new tenants. As a result of the new lettings, contracted rent increased by 9.5% to GBP 34.4 million as of October 2024 IPD from GBP 31.4 million as of the April 2024 IPD. Projected net rental income stood at GBP 31.7 million in October 2024, thus resulting in a debt yield of 8.6%, which is above the cash-trap covenant of 8.0%. In March 2023, Savills Plc (Savills) revalued the property at GBP 670.0 million, which is 9.5% lower than the previous valuation of GBP 740.0 million from Knight Frank LLP in September 2021, but still 11.6% higher than the initial valuation of GBP 600.0 million that Jones Lang LaSalle Incorporated conducted in October 2018. The senior loan's loan-to-value ratio remained constant at 54.9%, in compliance with the cash trap covenant of 72.5%. Morningstar DBRS maintained its stabilized net cash flow (NCF) assumption at GBP 25.3 million. In addition, Morningstar DBRS increased its cap rate assumption by 55 bps to 6.3% from 5.75% to further account for increased refinancing risk and other transaction-specific weaknesses. The increased cap rate translates into an updated Morningstar DBRS value of GBP 401.6 million, which represents a 40.0% haircut to Savills' valuation dated March 2023. At the previous review in July 2024, Morningstar DBRS' value was equal to GBP 439.9 million, thus reflecting a 34.3% haircut to the most recent valuation. In Morningstar DBRS' opinion, the current market value of the asset is likely lower given the widening of yields in the office market. The Sponsor put the asset on sale in September 2024 without attaching a formal price tag, but it is publicly known that they are seeking offers over GBP 500 million, which could mean a price as much as 25% lower than the latest valuation of GBP 670 million. Although this would be sufficient to fully repay the GBP 459.4 million outstanding debt secured against the building, the lack of deals of similar magnitude (i.e., big London offices) makes it difficult to pin down the property's exact current market value. The senior loan was initially scheduled to mature on January 20, 2022 with two one-year conditional extension options available to the borrower. The borrower exercised these options, extending the senior loan's maturity to January 22, 2024. The borrower then requested an additional 12 months' maturity extension to January 20, 2025. In December 2023, the servicer agreed to the extension conditional to certain amendments to the senior loan including, but not limited to, increasing the loan margin by 0.35% to 2.50% per annum for the period from January 20, 2024 to January 20, 2025 and a one-off maturity fee of 0.25% of the principal amount outstanding of the senior loan, both to be passed on to the noteholders and the VRR lender. The senior loan is interest only and currently accrues quarterly interest at the aggregate of compounded Sterling Overnight Interest Average (Sonia) and a credit adjustment spread of 0.1193%, plus the 2.5% annual margin. It is fully hedged up until January 2025 with an interest rate cap provided by Wells Fargo Bank, N.A. with a strike rate of 2.5%. The liquidity facility outstanding balance stood at GBP 20.0 million as of the April 2024 IPD, unchanged since issuance, and covers the Class A through Class D notes. According to Morningstar DBRS' analysis, the outstanding amount of the liquidity facility provides coverage of 13.7 months based on the interest rate cap strike rate of 2.5% or 9.1 months based on the 5.0% Sonia cap payable on the notes after the expected note maturity date. Notes: All figures are in British pound sterling unless otherwise noted. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Europe is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman, Editors. Copyright 2025. All rights reserved. ISSN 1529-2754. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Europe subscription rate is US$775 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000. * * * End of Transmission * * *