The UK's commercial property finance landscape has received a significant boost with the assignment of preliminary ratings by KBRA UK to five classes of UK Logistics 2026-3 DAC, a single-borrower Commercial Mortgage-Backed Securities (CMBS) transaction worth £603.0 million. This substantial loan, originated in June 2026 by a consortium comprising Deutsche Bank AG, London Branch, Standard Chartered Bank, and Qatar National Bank (Q.P.S.C.) London Branch, now takes centre stage as it undergoes securitisation.
Key features of the £603.0 million participation include a floating interest rate and an initial two-year term with provisions for three one-year extension options, offering flexibility to the borrower. The security behind this financing package is a diverse portfolio comprising 39 logistics properties across the United Kingdom, including both freehold (36 properties) and long leasehold (three properties) interests.
Geographically concentrated in key regions such as the Midlands (37.0%) and Southeast England (30.6%), these assets collectively encompass approximately 300 individual units spanning a total built area of 7.1 million square feet. As of February 2026, the portfolio exhibits strong occupancy with 88.9% of space leased to around 215 distinct tenants, ranging from multinational corporations to regional and local businesses.
KBRA applied its European CMBS Rating Methodology in assessing the properties' financial and operational performance, estimating sustainable net cash flow and a proprietary valuation that differed significantly from third-party appraisals. Notably, KBRA's aggregate valuation for the portfolio was approximately 35.0% lower than the third-party valuation, reflecting a cautious approach to asset appraisal. The securitised loan's loan-to-value ratio stands at 102.1%, based on KBRA's valuation.