NEW YORK--(UBS-Barclays 2012-C3 transaction (see ratings list below). UBS-Barclays 2012-C3 is a $1.08 billion CMBS conduit transaction collateralized by 76 fixed rate commercial mortgage loans that are secured by 113 properties.)--Kroll Bond Rating Agency (KBRA) is pleased to announce the assignment of preliminary ratings for the
The largest loan represents 10.4% of the pool, and is secured by 1000 Harbor Boulevard, a 10 story, 617,187 sf office building located in the Lincoln Harbor development in Weehawken, NJ. The loan is split into an A-1 and A-2 pari passu notes, and the A-1 serves as transaction collateral. The building is tenanted by UBS on a long term lease that expires in 2028. No other loans have a balance in excess of 10.0% of the pool.
The top five loans in the transaction represent 31.8% of the initial pool balance, and the top ten loans represent 45.6%. The underlying collateral properties are geographically diverse and located in 29 individual states. New Jersey is the highest state concentration and represents 13.2% of the underlying collateral. The only other exposures in excess of 9.0% include Michigan and Minnesota. The pool has exposure to all of the major property types with the three largest concentrations being in retail (39.8%), office (16.6%) and lodging (15.9%).
KBRA’s analysis of the transaction incorporated our multi-borrower rating process that begins with our analysts' evaluation of underlying collateral properties' financial and operating performance, which determine KBRA’s estimate of sustainable net cash flow (KNCF) and KBRA value. The analysis incorporates a detailed evaluation of underlying collateral properties’ financial and operating performance using our CMBS Property Evaluation Guidelines to determine Kroll Net Cash Flow (KNCF), which is a key input used in our credit modeling process. On an aggregate basis, KNCF was 3.0% less than the issuer cash flow. KBRA capitalization rates were applied to each asset’s NCF to derive values that were, on an aggregate basis, 30.1% less than third party appraisal values. The pool has an in-trust KLTV of 94.3% and an all-in KLTV of 95.5%. The model deploys rent and occupancy stresses, probability of default regressions, and loss given default calculations to determine losses for each collateral loan, which are then used to assign our credit ratings.
For complete details on the analysis, please see our presale Report, UBS-Barclays 2012-C3 published today at www.krollbondratings.com. The preliminary ratings are based on information known to KBRA at the time of this publication. Information received subsequent to this release could result in the assignment of final ratings that differ from the preliminary ratings.
Preliminary Ratings Assigned: UBS-Barclays 2012-C3
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All Nationally Recognized Statistical Rating Organizations are required, pursuant to SEC Rule 17g-7, to provide a description of a transaction’s representations, warranties and enforcement mechanisms that are available to investors when issuing credit ratings. KBRA’s disclosure for this transaction can be found in the report entitled CMBS: UBS-Barclays 2012-C3 17g-7 Disclosure Report.
Related publications (available at www.krollbondratings.com):
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