KBRA assigns preliminary ratings to CONE 2026-DFW3 data center CMBS deal in Texas

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KBRA rates CONE 2026-DFW3 CMBS

Highlights

KBRA assigns preliminary ratings to seven classes of CONE 2026-DFW3 CMBS, backed by a $1.05 billion fixed-rate, five-year mortgage loan.
The portfolio, 99.8% leased to 35 tenants as of December 2025, spans 472,099 square feet and provides 76.5 megawatts capacity in Allen, Texas.
KBRA's net cash flow estimate of $88.6 million is 9.3% below the issuer’s, yielding a 96.1% KBRA loan-to-value ratio, 30.5% below appraised value.

Transaction structure and asset profile

As reported by Kroll Bond Rating Agency, KBRA has assigned preliminary ratings to seven classes of CONE 2026-DFW3, a single-borrower CMBS securitization backed by a non-recourse first-lien mortgage loan. The fixed-rate loan totals $1.05 billion, is expected to carry a five-year term, and requires monthly interest-only payments.

The collateral consists of the borrowers’ fee simple interests in two adjacent data center properties and one excess land parcel in Allen, Texas. Combined, the portfolio spans about 472,099 square feet of gross building area, including 190,091 square feet of raised floor space, and provides 76.5 megawatts of capacity.

As of December 2025, the portfolio is 99.8% leased to 35 separate tenants. That occupancy level supports the transaction’s income profile as investors continue to track demand for specialized digital infrastructure assets in major U.S. growth markets.

Cash flow analysis and credit metrics

KBRA says its review includes a detailed analysis of the properties’ cash flows under its North American CMBS Property Evaluation Methodology and its North American CMBS Single Borrower & Large Loan Rating Methodology. The agency also applies its Global Structured Finance Counterparty Methodology to assess counterparty risk in the transaction.

Its analysis produces a KBRA net cash flow of about $88.6 million, 9.3% below the issuer’s net cash flow estimate. KBRA also derives a value of about $1.09 billion, which is 30.5% below the appraiser’s as-is value, resulting in an in-trust KBRA loan-to-value ratio of 96.1%.

The agency says it also reviews third-party engineering, environmental, and appraisal reports, along with site inspection findings and legal documentation. Those measures help frame the risk profile of a large single-asset financing tied to the performance of data center real estate in the Dallas-area market.

Our earlier report on KBRA’s Q2 2026 U.S. credit outlook outlined why the agency expects resilient economic growth and corporate earnings to help credit markets absorb recent shocks. It also highlighted key risks investors are watching—stubborn inflation pressures tied to tariffs and fiscal stimulus, and spillover effects from Middle East tensions that could lift energy- and input-costs and weigh on more vulnerable sectors.

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