DBRS Morningstar Releases Commentary on the Negative Impact of Coronavirus on UK CMBS Backed by Hotel Assets

DBRS Morningstar released a commentary titled “Coronavirus (COVID-19) Impact Negative in the Short Term for UK CMBS Backed by Hotel Assets”. The recent outbreak of the Coronavirus Disease (COVID-19) is beginning to have an economic impact wherever cases increase. In the UK, recent developments in Europe and the increasing number of cases are likely to negatively affect Hotel CMBS.

Our commentary explores COVID-19’s potential impact on UK CMBS backed by hotel assets. Some highlights include:
--The virus outbreak’s effect on hoteliers’ revenue for limited- and full-service hotels, in the short term.
--The long-term impact of the virus on UK CMBS transactions backed by hotel assets.

DBRS Morningstar currently rates three UK hotel CMBS transactions: Helios (European Loan Conduit No. 37) DAC, Magenta 2020 PLC, and Ribbon Finance 2018 Plc, amounting to GBP 1 billion by debt outstanding (or GBP 1.68 billion by Market Value). The three transactions represent three separate loans, which are secured in aggregate by 86 UK hotels.

For more information regarding rating methodologies and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/357883/dbrs-morningstar-provides-update-on-rating-methodologies-in-light-of-measures-to-contain-coronavirus-disease-covid-19.

Notes:
The full commentary is available at www.dbrsmorningstar.com.

For more information, visit www.dbrsmorningstar.com or contact us at [email protected].

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