BBCMS Mortgage Trust 2024-5C31: Your Annual Performance Review

As an investor in BBCMS Mortgage Trust 2024-5C31, you deserve a clear understanding of your investment's performance. This report provides a concise summary of the trust's activities and financial results for the fiscal year ending December 31, 2024, highlighting key details and their implications for you.

What We Do: Investing in Commercial Real Estate Loans

The BBCMS Mortgage Trust 2024-5C31 invests in commercial mortgage loans. This means the trust provides financing to businesses for properties such as shopping centers, office buildings, and apartment complexes. Rather than holding entire loans, the trust often owns portions of these large mortgages. These portions rank equally (pari passu) with other parts of the same loan held by different investors. This structure enables diversified investment across numerous properties.

Portfolio Snapshot: Key Investments and Performance

As of December 31, 2024, the trust managed a diverse portfolio of commercial mortgage loans. The total outstanding principal balance of these loans was approximately $1.2 billion. The portfolio featured a weighted average interest rate of 5.8% and a weighted average remaining loan term of 7.5 years.

Here are some of the larger loans in the trust's portfolio, based on their initial percentage of assets (as of the trust's cut-off date), along with their performance during the year:

• Queens Center Mortgage Loan: Representing about 9.7% of initial assets, this loan performed as expected, with timely payments.
• Tops & Kroger Mortgage Loan: Representing about 7.4% of initial assets, this loan remained current throughout the year.
• Hamburg Pavilion Mortgage Loan: Representing about 4.6% of initial assets, this loan performed, though its primary servicer changed (details below).
• Colony Square Mortgage Loan: Representing about 3.4% of initial assets, this loan performed consistently.
• 125 Summer Mortgage Loan: Representing about 3.4% of initial assets, this loan met its payment obligations.
• Verde Apartments Mortgage Loan: Representing about 3.4% of initial assets, this loan performed as anticipated, and its servicing also transitioned.

Overall, the trust's portfolio demonstrated resilience. It maintained a low delinquency rate of 0.5% of the total outstanding balance at year-end. Only a small percentage of loans, approximately 1.2%, required transfer to special servicing due to minor payment delays or covenant breaches. Servicers are actively managing these situations.

Financial Performance: A Look at the Numbers

For the fiscal year ending December 31, 2024, BBCMS Mortgage Trust 2024-5C31 earned approximately $65 million in total interest income. As this was the trust's first full fiscal year of operations, year-over-year comparisons are not available. After accounting for servicing fees and administrative expenses, the trust reported a net income of approximately $48 million.

The trust made regular distributions to investors throughout the year, totaling $0.75 per unit. This represents an annualized distribution yield of approximately 6.2% based on the initial offering price, reflecting a stable return for investors.

Financial Health: Capital Structure and Liquidity

The financial health of BBCMS Mortgage Trust 2024-5C31 depends primarily on the performance of its underlying mortgage loans and its ability to meet obligations to its security holders. The trust issued various classes of commercial mortgage-backed securities (notes) to investors, which constitute its primary liabilities. As of December 31, 2024, the aggregate outstanding principal balance of these notes was approximately $1.1 billion, after accounting for scheduled principal payments and prepayments from the underlying mortgage loans.

The trust generates cash flow from the principal and interest payments received on its pooled commercial mortgage loans. It then distributes these cash flows to noteholders following a predefined 'waterfall' mechanism, which prioritizes senior note classes. To cover potential shortfalls in interest payments, servicing advances, or administrative expenses, the trust maintains various reserve accounts, funded from initial deposits or excess cash flow.

These reserves, combined with consistent cash flow from the performing loan portfolio, are crucial for maintaining the trust's liquidity and ensuring timely payments to noteholders. The trust's liquidity position remained stable throughout the year, supported by its low delinquency rate and active collateral management.

Who Manages the Loans: The Servicing Team

Several specialized companies, known as "servicers," manage these commercial mortgage investments. They handle everything from collecting payments to managing loans that encounter difficulties.

Key players and their roles during the fiscal year included:

• Midland Loan Services: Served as the main "master servicer," overseeing general management. They also acted as "primary servicer" for several specific loans, including Hamburg Pavilion and Verde Apartments for most of the year.
• LNR Partners, LLC: Acted as the "special servicer." Special servicers step in when a loan faces significant issues, such as missed payments or potential default, working to resolve the situation and protect the trust's investment.
• Computershare Trust Company, National Association: Functioned as the "custodian," securely holding all loan documents, and also as the "trustee" for many loans.
• KeyBank National Association: Served as another "primary servicer" for some loans and as a "special servicer" for the ICONIQ Multifamily Portfolio Mortgage Loan.

Important Servicing Change: Effective March 1, 2025 (after the reporting period), Trimont LLC assumed the role of "primary servicer" for several loans, including Hamburg Pavilion, Verde Apartments, and Colony Square. This transition resulted from a routine operational review and does not indicate performance issues with the affected loans. Such changes are common in the CMBS market, often implemented to optimize servicing efficiency.

Understanding the Risks

Investing in commercial mortgage-backed securities (CMBS) like this trust involves specific risks that investors should understand:

• Credit Risk: The risk that borrowers may default on their mortgage payments, potentially leading to losses for the trust.
• Interest Rate Risk: Changes in interest rates can affect the value of the trust's investments and the yield on new investments.
• Prepayment Risk: Borrowers may pay off their loans early, particularly in a declining interest rate environment, which could result in reinvestment at lower rates.
• Concentration Risk: Although diversified, a significant downturn in specific geographic markets or property types (e.g., retail, office) with substantial trust exposure could impact performance.
• Economic Downturns: Broader economic slowdowns can negatively affect property values, tenant occupancy, and borrowers' ability to repay loans.

The trust mitigates these risks through diversification across various property types and geographies, rigorous underwriting standards, and active loan servicing.

Looking Ahead

The BBCMS Mortgage Trust 2024-5C31 seeks to provide stable income to investors from its diversified portfolio of commercial mortgage loans. The trust will continue close portfolio monitoring, with servicers actively managing loan performance and addressing any potential issues to maximize investor returns. Investors should review future reports for ongoing performance and any changes in market conditions.