Kroll Bond Rating Agency Assigns Final Ratings to MSBAM 2012-CKSV

NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) assigned its final ratings to seven classes of MSBAM 2012-CKSV certificates issued in a $406.0 million CMBS large loan transaction. Concurrently, we have withdrawn our preliminary ratings on the certificates, which were assigned on September 19, 2012 (see our ratings listed below).

The transaction is collateralized by two non-recourse, first lien mortgage loans that are not cross-collateralized or cross-defaulted. Each loan is secured by a super-regional mall. The larger of the two loans has a balance of $216.0 million and is secured by the borrower’s fee simple interests in the 631,537 sf of the Clackamas Town Center, a 1.4 million sf mall located in Happy Valley, Oregon. The second loan has a balance of $190.0 million and is secured by the fee and leasehold interest in 1.2 million sf of the Sunvalley Shopping Center, a 1.4 million sf super-regional mall located in Concord, California.

KBRA’s analysis of the transaction included a detailed evaluation of each mall’s cash flows using our CMBS Property Evaluation Guidelines, and the application of our CMBS Single Borrower & Large Loan Rating Methodology. The analysis yielded a Kroll Net Cash Flow (KNCF) of $22.8 million for Clackamas Town Center and $23.2 million for Sunvalley Shopping Center. To value the properties, we applied capitalization rates of 8.00% and 8.25% to the KNCF for Clackamas Town Center and Sunvalley Shopping Center, respectively. The results of our analysis yielded a KBRA value and KLTV of $248.8 million and 75.8% for Clackamas Town Center. The KBRA valuation and KLTV for Sunvalley Shopping Center is $281.1 million and 79.6%, respectively. Our analysis of the transaction also included evaluation of third party engineering and environmental reports, as well as our site inspections of the properties and their competition.

For complete details on the analysis, please see our Pre-Sale Report, MSBAM 2012-CKSV 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.

Final Ratings Assigned: MSBAM 2012-CKSV
Class	Expected Rating	Balance (US$)
A-1	AAA (sf)	$36,106,000
A-2	AAA (sf)	$243,760,000
X-A*	AAA (sf)	$279,866,000
X-B*	AAA (sf)	$37,538,000
B	AA (sf)	$37,538,000
C	A (sf)	$40,879,000
D	BBB+ (sf)	$22,278,059
*Notional Amount

17g-7 Disclosure:

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 MSBAM 2021-CKSV 17g-7 Disclosure Report.

Related publications:

CMBS Property Evaluation Guidelines, published June 10, 2011

CMBS Single Borrower & Large Loan Rating Methodology, published August 8, 2011

About Kroll Bond Rating Agency

Kroll Bond Rating Agency, Inc. (www.krollbondratings.com) is registered with the SEC as a nationally recognized statistical rating organization (NRSRO). Kroll Bond Rating Agency was established in 2010 to restore trust in credit ratings by establishing new standards for assessing risk and by offering accurate, clear, and transparent ratings.