NEW YORK, October 01, 2024--(BUSINESS WIRE)--KBRA assigns preliminary ratings to four classes of notes (the Series 2024-1/2 Notes) from Centersquare Issuer LLC and Centersquare Co-Issuer LLC Series 2024-1 and Series 2024-2 (Series 2024-1/2), a colocation data center ABS transaction. The transaction represents the first securitizations by Centersquare Issuer LLC and Centersquare Co Issuer LLC.

The Series 2024-1/2 Notes are secured by 21 data centers generating approximately $295.1 million of Total Annualized Monthly Recurring Revenue (AMRR) and approximately $114.0 million of Annualized Adjusted Net Operating Income (AANOI) as of June 30, 2024 (the Statistical Disclosure Date). This includes the fee simple ownership interests in seven multi-customer enterprise data centers (35.0% of AMRR or 53.2% of AANOI) located in five markets and leasehold interests in 14 multi-customer enterprise data centers (65.0% of AMRR or 46.8% of AANOI) located in ten markets. The 21 data centers are comprised of approximately 809,358 square feet (sf) of data center space and can provide approximately 106.2 megawatts (MW) of critical load power to customers.

The data center colocation customers use the data center space for power, space, and cooling of their data center equipment, cloud services, business continuity and other professional services. As of the Statistical Disclosure Date, of the portfolio is comprised of 854 unique customers, pursuant to separate customer contracts with a weighted average remaining contract term, including one auto renewal option, of 4.5 years. The top 20 customers account for approximately 47.6% of AMRR. The portfolio of customers operate in 15 unique industries. The top three industries include cloud and IT services (44.1% of AMRR), banking and securities (18.2%), and network service providers (12.6%).

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Methodologies

• CMBS: North American CMBS Property Evaluation Methodology

• CMBS: North American CMBS Single Borrower & Large Loan Rating Methodology

• ABS: General Global Rating Methodology for Asset Backed Securities

• Structured Finance: Global Structured Finance Counterparty Methodology

• ESG Global Rating Methodology

Disclosures

Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.