NEW YORK--(EON: Enhanced Online News)--Kroll Bond Rating Agency (KBRA) affirmed all of its outstanding ratings for all classes of CGCMT 2012-GC8, a $1.0 billion CMBS multi-borrower conduit transaction. The transaction is collateralized by 57 fixed-rate commercial mortgage loans that are secured by 139 commercial and multifamily properties. For individual certificate ratings, please see the list below.
The transaction has exhibited stable performance since issuance. The WA KLTV (94.6%) and WA KDSC (1.60x) are relatively unchanged since securitization, when they were 94.8% and 1.61x, respectively. The top 10 loans, which comprise 59.9% of the pool, have generally posted stable to improving performance. With the exception of the fifth largest loan in the pool, Gansevoort Park Avenue (7.3%), all were assigned a KBRA Performance Outlook (KPO) of Perform. The Gansevoort Park Avenue loan is secured by a 19-story, 249-key luxury full service boutique hotel located on Park Avenue between 28th and 29th Streets in the Gramercy/Flatiron submarket of New York City. The property’s KBRA Net Cash Flow (KNCF) has declined by 13.1% since securitization, which is largely attributable to lower RevPAR and lower food and beverage net income. In addition, new competition is under construction and is expected to come online in 2015. Considering the decline in operating performance and increased competition, the loan was assigned a KPO of Underperform. The underperformance of the property was offset by the improved performance of the other loans in the transaction, as well as deleveraging due to loan amortization. As a result, it did not prompt negative rating actions.
As of the September 2013 pay-date, there are no delinquent loans or loans in special servicing. During our review of the transaction, we did not identify any KBRA Loans of Concern (“K-LOCs”). K-LOCs are loans that are either in default or at heightened risk of default in the near term. The review included an examination of two loans on that appeared on the master servicer’s watchlist, which comprises 3.9% of the pool, as well as a review of the CREFC Investor Reporting Package files and other information provided by the master servicer.
The review utilized property financial information obtained from the master servicer, Wells Fargo Bank, National Association (Wells Fargo). Wells Fargo provided updated financial information for 99.1% of the pool. Of this information, June 2013 data was available for 34 loans (59.9% by balance), March 2013 data was available for 17 loans (33.2%) and December 2012 data was available for five loans (6.0%). KBRA generally utilized 12 months of financial information to determine KNCF. KBRA annualized financial information for loans with partial year financial data in certain instances where 12 months of financial data wasn’t available. Once KNCF was determined, we conducted our credit modeling using the KBRA Multi-Borrower Model. The modeling produced credit enhancement levels that were compared to the transaction's capital structure, which resulted in the affirmation of all of the transaction's outstanding ratings. For complete details on our analysis, please refer to the surveillance report, as well as links to the publications below.
|Class||Rating||Current Balance (US$)||Rating Action|
1 Notional class
Related Publications (available at https://www.krollbondratings.com):