Fitch Affirms UBS-BAMLL Trust 2012-WRM
OREANDA-NEWS. Fitch Ratings has affirmed all classes of UBS-BAMLL Trust 2012-WRM commercial mortgage pass-through certificates series 2012-WRM.
A full list of rating actions follows at the end of this release.
KEY RATING DRIVERS
The affirmations and Stable Outlooks are the result of stable property performance. Fitch reviewed the most recent available financial performance available which indicates the servicer-reported net operating income (NOI) was in-line with Fitch's original analysis at issuance. Occupancy at both properties was stable with Roseville reporting occupancy of 97% and MainPlace reporting occupancy of 98%. The most recent tenant sales figures indicate stable performance.
The transaction represents a securitization of the beneficial interests in two mortgage loans securing the Galleria at Roseville and MainPlace regional malls located in Roseville and Santa Ana, CA, respectively. Proceeds of the loan were used to pay down existing debt and pay closing costs as well as return approximately $230 million in cash to the sponsor, Westfield America, Inc. The certificates follow a sequential-pay structure. The interest-only loans mature in June 2022.
The MainPlace Mall was sold in December 2015 as part of a deal that included four other Westfield Corporation retail centers. The new owners include a partnership of Centennial Real Estate Company, LLC, Montgomery Street Partners, and USAA Real Estate Company with Westfield affiliate, holding a minority equity interest. The management of the mall has also changed from Westfield Property Management LLC to Centennial Real Estate Company, LLC, a national management company founded in 1997. The company specializes in the investment, development and management of retail properties.
The Galleria at Roseville (66.3%), located in Roseville, CA (Sacramento MSA) is a 1.3 million square foot (sf) super-regional mall anchored by Macy's, JC Penney, Nordstrom, and Sears, each of which own their respective spaces. Collateral for the loan is comprised of approximately 660,000 sf of in-line space that is currently leased to approximately 220 tenants including Pottery Barn, Abercrombie and Fitch, Crate & Barrel, Forever 21, and H&M. As of the December 2015 rent roll, the in-line space was approximately 95% leased. Total mall sales as of year-end 2015 were $529 million, representing a 7% increase from the prior year-end. In-line sales per square foot (psf) for the same period were $412 psf excluding Apple, representing an 11% decrease from the prior year-end. Through year-end 2014, the debt service coverage ratio (DSCR) was 3.15x.
MainPlace Mall (33.7%), located in Santa Ana, CA (Orange County), is a 1.1 million sf super-regional mall anchored by Macy's, Nordstrom, and JC Penney. The fourth anchor space was formerly occupied by Macy's Men's & Home, which consolidated into the Macy's space in 2013. The Borrower subsequently obtained the leasehold interest in and fee title to the improvements and leased the space back to an affiliate of the Borrower. The ground lease income was excluded from Fitch's analysis of the net cash flow given the related party transaction. Collateral for the loan is approximately 616,000 sf comprised of the in-line space and JC Penney. Per the September 2015 rent roll, the property was approximately 98% leased. YE 2015 mall sales were not available. Total mall sales as of year-end 2014 were $244 million, representing a 4% increase from the prior year-end. In-line sales psf for the same period were $332 psf.
The Outlook remains Stable for all classes. No rating actions are expected unless there are material changes in property occupancy or cash flow. The property performance is consistent with issuance. The transaction is secured by two retail mall properties and therefore more susceptible to event risk related to the market, sponsors or the largest tenants.
Initial Key Ratings Drivers and Rating Sensitivity are further described in the New Issue report titled 'UBS-BAMLL Trust 2012-WRM Series 2012-WRM' (July 2012).
DUE DILIGENCE USAGE
No third-party due diligence was provided or reviewed in relation to this rating action.
Fitch has affirmed the following ratings:
--$284,000,000 class A at 'AAAsf'; Outlook Stable;
--$284,000,000 interest-only class X-A* at 'AAAsf'; Outlook Stable;
--$131,000,000 interest-only class X-B* at 'BBB-sf'; Outlook Stable;
--$43,000,000 class B at 'AAsf'; Outlook Stable;
--$36,000,000 class C at 'Asf'; Outlook Stable;
--$39,000,000 class D at 'BBBsf'; Outlook Stable;
--$13,000,000 class E at 'BBB-sf'; Outlook Stable.