Kroll Bond Rating Agency Assigns Preliminary Ratings to WFCM 2013-120B

NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) is pleased to announce the assignment of preliminary ratings for the WFCM 2013-120B transaction (see ratings list below). WFCM 2013-120B is a $310.0 million CMBS single borrower transaction.

The collateral for the securitization is a single, first lien mortgage loan that is secured by the borrower’s leasehold interest in a 1.9 million square feet (sf) office property at 120 Broadway, New York, NY. The property is a 40-story, landmark office building located in the heart of Downtown Manhattan in New York City. It is also known as the Equitable Building and was constructed in 1915 as the headquarters of AXA Equitable Insurance Company. It is one of New York’s original skyscrapers. The property consists of 1.8 million sf of office space and 72,186 sf of retail and storage space. As of March 2013, the property was 92.4% leased to 74 tenants, including the New York State Attorney General, Tower Group, Inc. and Securities Industry and Financial Markets Association. The loan has a seven year term and requires monthly interest-only payments calculated using an annualized rate of 2.72%.

KBRA’s analysis of the transaction included a detailed evaluation of the property’s cash flow using our CMBS Property Evaluation Guidelines, and the application of our CMBS Single Borrower and Large Loan Rating Methodology. The results of our analysis yielded a KBRA Net Cash flow (KNCF) of $36.3 million. To value the property, we applied an 8.20% capitalization rate to arrive at a value of $442.9 million. Our resulting KBRA Loan to Value (KLTV) was 70.0%. In our analysis of the transaction, we also reviewed and considered third party engineering, environmental and appraisal reports, our own on-site inspection of the property and the competition and legal documentation and opinions.

For complete details on the analysis, please see our Pre-Sale Report, entitled WFCM 2013-120B, which was 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: WFCM 2013-120B
Class	Expected Rating	Balance (US$)
A	AAA (sf)	$210,385,000
X-A*	AAA (sf)	$210,385,000
X-B*	AAA (sf)	$50,461,000
B	A (sf)	$50,461,000
C	BBB- (sf)	$35,570,000
D	BBB- (sf)	$13,584,000

*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 WFCM 2013-120B 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.