Commercial Real Estate Direct Staff Report
UBS-Barclays Commercial Mortgage Trust, 2012-C2, with a 38.3 percent exposure to the ailing shopping mall sector, is taking it on the chin as most of the mall loans in its collateral pool have weakened.
The transaction, which originally had a $1.2 billion balance, has paid down to $900.2 million. It hasn't suffered any losses yet, but has accumulated just less than $630,000 of interest shortfalls.
Six of its remaining loans, with a total balance of $345.1 million, are backed by regional malls. And Fitch Ratings classifies four of those, with a total balance of $246.4 million, or 27.4 percent of the deal's remaining balance, as Fitch Loans of Concern, or FLOCs. It's downgraded four of the CMBS deal's bond classes because the losses it now expects to result from the mall loans have increased.
It downgraded the deal's:
- $24.3 million class D, to BBB from BBB+;
- $47.1 million class E, to B from BBB-;
- $22.8 million class F, to CCC from BB-; and
- $24.3 million class G, to CC from B-
While none of the four mall loans are in special servicing, three are on servicer watchlists. Nonetheless, each collateral property has lost at least one anchor tenant, and all have seen a deterioration in financial performance since their respective loans were securitized.
At the top of the FLOC list is the deal's largest loan: the $86.1 million mortgage against 518,480 square feet at the 783,280-sf Crystal Mall in Waterford, Conn., which is about 45 miles south of Hartford, Conn. The mall, which is owned by a venture of Simon Property...
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