Morningstar DBRS Confirms All Credit Ratings on LoanCore 2022-CRE7 Issuer Ltd.

DBRS, Inc. (Morningstar DBRS) confirmed its credit ratings on all classes of notes issued by LoanCore 2022-CRE7 Issuer Ltd. as follows:

-- Class A Notes at AAA (sf)
-- Class A-S Notes at AAA (sf)
-- Class B Notes at AA (sf)
-- Class C Notes at A (high) (sf)
-- Class D Notes at A (low) (sf)
-- Class E Notes at BBB (sf)
-- Class F Notes at BB (low) (sf)
-- Class G Notes at B (low) (sf)

All trends are Stable.

The credit rating confirmations reflect the overall stable performance of the underlying loans, which continue to be primarily secured by traditional multifamily collateral (26 loans, representing 97.6% of the current pool balance; the only other loan is backed by a manufactured housing property). Historically, loans secured by multifamily properties have exhibited lower default rates and the ability to retain and increase asset value. Additionally, most borrowers are progressing with the stated business plans to increase property cash flows and stabilize operations to increase the respective asset values. In conjunction with this press release, Morningstar DBRS has published a Surveillance Performance Update report with in-depth analysis and credit metrics for the transaction and with business plan updates on select loans. For access to this report, please click on the link under Related Documents below or contact us at info-dbrs@morningstar.com.

The initial collateral consisted of 29 floating-rate mortgages, secured by 29 transitional properties, with a cut-off trust balance of $1.25 billion, excluding approximately $65.4 million of future funding participations. There was also $194.7 million of funded companion participations held outside the subject transaction. The transaction was structured with a two-year Reinvestment Period that expired with the March 2024 Payment Date. As of the June 2025 remittance, the pool comprised 27 loans, secured by 31 properties, with a cumulative trust balance of $1.35 billion. Since July 2024, three loans with a former cumulative loan balance of $135.8 million have been successfully repaid from the trust.

Leverage across the pool has marginally decreased since issuance as the current weighted-average (WA) as-is appraised loan-to-value (LTV) ratio is 72.1%, with a current WA stabilized LTV ratio of 66.2%. In comparison, these figures were 72.6% and 66.3%, respectively, since issuance. Morningstar DBRS recognizes that select property values may be inflated as the majority of the individual property appraisals were completed in 2022 and may not reflect the increase in interest and capitalization rates (cap rates) since that time. In the analysis for this review, Morningstar DBRS applied upward LTV adjustments to 19 loans, representing 82.4% of the current pool balance, generally reflective of higher cap rate assumptions compared with the implied cap rates based on the appraisals.

As of June 2025 reporting, five loans, representing 23.3% of the current trust balance, are on the servicer's watchlist. The largest loan on the servicer's watchlist and in the pool, GVA Sunrise Portfolio - Pool C (Prospectus ID#31; 11.0% of the current trust balance), is secured by a portfolio of five multifamily properties in the Dallas (two properties; 480 units), Houston (one property; 264 units), Nashville (one property; 364 units), and Greenville, South Carolina (one property; 562 units) metropolitan areas. The loan initially transferred to special servicing in November 2024 for imminent payment default; however, the loan is current and is also still categorized as a specially serviced loan in the June 2025 remittance report. The borrower's original business plan was to use up to $16.1 million to complete unit interior and propertywide upgrades across the portfolio to increase rental rates and cash flow; however, it could not execute its plan amid liquidity limitations driven by stress across its commercial real estate portfolio. The loan sponsor was ultimately replaced by an equity partner in June 2024, when the loan was first modified. An additional loan modification completed in December 2024 allowed the borrower to alter the original business plan and enter into affordable housing programs with local municipalities for the Greenville property, as well as three Texas properties, in exchange for full real estate tax abatements. The collateral manager has confirmed that the agreements for all four properties have been executed. To effectuate the change in the business plan, the lender provided $5.3 million in new mezzanine debt to finance the closing of the affordable housing programs and to fund operating shortfalls and updated capital expenditure (capex) budgets across the portfolio. The mezzanine debt is co-terminous with the senior loan and is being held outside the subject trust.

The loan has a current senior balance of $282.3 million with a $148.9 million piece in the trust. Since closing, the lender has advanced $11.9 million of loan future funding to the borrower; however, $3.8 million of that amount was reallocated for debt service reserves. The collateral manager has confirmed the borrower has used $8.0 million of future funding to complete a total of 517 unit upgrades across the portfolio to date. The collateral manager also provided an updated capex schedule and budget totaling $5.0 million across the five properties, most of which is budgeted for exterior upgrades ($3.6 million). Only 41 additional units across the portfolio are scheduled to be renovated. The portfolio was reappraised at $239.4 million in May 2024 (LTV of 117.9%); however, the appraiser's as-is valuation increases to $290.4 million (LTV of 97.0%) assuming the three additional affordable housing agreements are completed. The collateral manager has not provided updated as-stabilized appraised values to date. In the analysis for this review, Morningstar DBRS applied stressed LTVs based on the updated as-is appraisal as well as an increased probability of default (POD) adjustment to reflect the changed business plan and uncertainty surrounding the timing of portfolio stabilization. Though the loan does not have a final maturity until 2028, the term risks have increased as the original business plan was not achieved and liquidity issues have resulted in the need for mezzanine financing for the revised business plan. The resulting loan expected loss (EL) is approximately two times greater than the EL for the pool.

As of the June 2025 reporting, the lender had advanced cumulative loan future funding of $64.1 million to 16 of the outstanding individual borrowers to aid in property stabilization efforts. The pace of borrowers requesting advances has slowed in the past year as only $1.4 million across three loans was advanced between July 2024 and May 2025. The largest advance ($15.6 million) since respective loan closing has been made to the borrower of the El Centro loan (Prospectus ID#34; 7.9% of the current pool balance), which is secured by the leasehold interest in a 507-unit Class A multifamily property in Hollywood, California. The borrower's business plan focuses on increasing the retail component's occupancy rate by providing competitive tenant improvement packages. As of April 2025, the occupancy rate for the 457 market-rate multifamily units was 88.4% with an average rental rate of $2,980 per unit; however, the retail component was only 46.0% leased and the net cash flow (NCF) was $7.6 million for the trailing 12-month (T-12) period ended February 28, 2025, well below Morningstar DBRS' and the Issuer's stabilized NCF projections of $12.7 million and $15.4 million, respectively. The June 2025 final maturity date contributes to the increased credit risks for this loan; however, according to the collateral manager, a short-term extension is expected to be finalized to provide the borrower time to market the property for sale. Morningstar DBRS believes the property's current market value has declined significantly from the as-is appraised value of $267.0 million at issuance. Applying a cap rate range of 4.5% to 5.5% to the NCF for the T-12 period ended February 28, 2025, yields as-is property values between $169.6 million and $138.8 million, respectively, with associated whole loan LTVs of 92.6% and 113.2%, respectively. Morningstar DBRS applied an LTV of approximately 100.0% as well as an increased POD penalty in the analysis for this review, resulting in a loan EL slightly above the EL for the overall pool.

An additional $18.1 million of loan future funding allocated to six of the outstanding individual borrowers remains available; however, just over half of the available funds are allocated to the El Centro ($9.4 million) and GVA Sunrise Portfolio - Pool C ($4.3 million) loans, both of which are exhibiting increased risks that could limit the likelihood those are ultimately funded, as previously outlined.

Through June 2025, 21 of the outstanding loans, representing 80.2% of the current trust balance have been modified or received a forbearance agreement. The terms of the individual loan modifications vary and have included the waiver of performance-based tests to exercise maturity extensions, the requirement to purchase new interest rate cap agreements, changes to interest rate structures and reallocations of loan future funding dollars. Loan modifications have often required additional equity commitments from borrowers in the form of upfront principal curtailments, deposits into reserve accounts, and/or increased loan payment guarantees.

Morningstar DBRS' credit ratings on the applicable classes address the credit risk associated with the identified financial obligations in accordance with the relevant transaction documents. Where applicable, a description of these financial obligations can be found in the transactions' respective press releases at issuance.

Morningstar DBRS' long-term credit ratings provide opinions on risk of default. Morningstar DBRS considers risk of default to be the risk that an issuer will fail to satisfy the financial obligations in accordance with the terms under which a long-term obligation has been issued. The Morningstar DBRS short-term debt rating scale provides an opinion on the risk that an issuer will not meet its short-term financial obligations in a timely manner.

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance factors that had a significant or relevant effect on the credit analysis.

A description of how Morningstar DBRS considers ESG factors within the Morningstar DBRS analytical framework can be found in the Morningstar DBRS Criteria: Approach to Environmental, Social, and Governance Factors in Credit Ratings (May 16, 2025) at https://dbrs.morningstar.com/research/454196.

All credit ratings are subject to surveillance, which could result in credit ratings being upgraded, downgraded, placed under review, confirmed, or discontinued by Morningstar DBRS.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The principal methodology is North American CMBS Surveillance Methodology (February 28, 2025), https://dbrs.morningstar.com/research/448963.

Other methodologies referenced in this transaction are listed at the end of this press release.

The credit rating assigned to the Class F Notes materially deviates from the credit rating implied by the predictive model. Morningstar DBRS typically expects there to be a substantial likelihood that a reasonable investor or other user of the credit rating would consider a three-notch or more deviation from the credit rating stress(es) implied by the predictive model to be a significant factor in evaluating the credit rating. The rationale for the material deviation is sustainability of the loan performance trends were not demonstrated as select borrowers remain behind in the respective business plans to increase property cash flow and asset value.

The credit rating was initiated at the request of the rated entity.

The rated entity or its related entities did participate in the credit rating process for this credit rating action.

Morningstar DBRS had access to the accounts, management, and other relevant internal documents of the rated entity or its related entities in connection with this credit rating action.

This is a solicited credit rating.

For more information on Morningstar DBRS' policy regarding the solicitation status of credit ratings, please refer to the Credit Ratings Global Policy, which can be found in the Morningstar DBRS Understanding Ratings section of the website: https://dbrs.morningstar.com/understanding-ratings

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the credit rating process.

DBRS, Inc.
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Chicago, IL 60602 USA
Tel. +1 312 332-3429

The credit rating methodologies used in the analysis of this transaction can be found at: https://dbrs.morningstar.com/about/methodologies.

-- North American CMBS Multi-Borrower Rating Methodology (April 9, 2025)/North American CMBS Insight Model v. 1.3.0.0
https://dbrs.morningstar.com/research/451739
-- Morningstar DBRS North American Commercial Real Estate Property Analysis Criteria (September 19, 2024)
https://dbrs.morningstar.com/research/439702
-- Legal Criteria for U.S. Structured Finance (December 3, 2024)
https://dbrs.morningstar.com/research/444064
-- Interest Rate Stresses for U.S. Structured Finance Transactions (March 27, 2025)
https://dbrs.morningstar.com/research/450750
-- North American Commercial Mortgage Servicer Rankings (August 23, 2024)
https://dbrs.morningstar.com/research/438283

For more information on this credit or on this industry, visit https://dbrs.morningstar.com or contact us at info-DBRS@morningstar.com.