Kroll Bond Rating Agency Assigns Final Ratings to BB-UBS Trust 2012-SHOW
NEW YORK -- November 15, 2012
Kroll Bond Rating Agency (KBRA) is pleased to announce the assignment of final
ratings to the BB-UBS Trust 2012-SHOW transaction (see ratings list below).
BB-UBS Trust 2012-SHOW is an $835.0 million CMBS single borrower transaction.
The collateral for the securitization is comprised of a single, non-recourse,
first lien mortgage loan with an original principal balance of $835.0 million,
made by Barclays Bank PLC and UBS Real Estate Securities Inc. to a special
purpose entity that is indirectly owned and controlled by GGP Limited
Partnership, an affiliate of General Growth Properties, Inc. (GGP). The loan
is secured by the borrower’s fee simple interest in 836,006 sf of a 1.86
million sf super-regional mall known as Fashion Show Mall, which is located on
the Las Vegas Strip in Nevada. The mall features seven major tenants (> 10,000
sf) and 198 in-line (<10,000 sf), food court and kiosk tenants that are
predominately leased to national retailers. There are seven anchor tenants,
including Nordstrom, Macy’s, Saks Fifth Avenue, Forever 21, Bloomingdale’s
Home, Neiman Marcus, and Dillard’s, of which Forever 21 serves as loan
collateral. Dillard’s owns its improvements and the underlying land, and the
remaining anchors own their improvements subject to a ground lease with the
The mall is currently undergoing a redevelopment of portion of the center that
was formerly anchored by Robinson-May. The redevelopment space will serve as
collateral for the loan, and will include a new 104,406 Macy’s Men’s anchor
store, as well as 97,829 sf of in-line space. To mitigate completion risk, GGP
funded a $25.5 million reserve, provided a completion guaranty, and signed a
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 Loan Rating Methodology. The
results of our analysis yielded a KBRA Net Cash flow (KNCF) of $78.0 million.
To value the property, we applied a 7.0% capitalization rate to arrive at a
KBRA value of $1.1 billion. Our resulting KBRA Loan to Value (KLTV) was 75.0%.
In our analysis of the transaction, we also reviewed and considered third
party engineering and environmental reports, as well as our own on-site
inspection of the property and the competition.
For complete details on the analysis, please see our presale Report, BB-UBS
Trust 2012-SHOW, published on October 23, 2012 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: BB-UBS Trust 2012-SHOW
Class Rating Balance (USD) Rating Action
A AAA (sf) 539,500,000 Preliminary
X-A AAA (sf) 539,500,000 Preliminary
X-B AAA (sf) 82,600,000 Preliminary
B AA (sf) 82,600,000 Preliminary
C A (sf) 77,800,000 Preliminary
D BBB+ (sf) 42,100,000 Preliminary
E BBB- (sf) 93,000,000 Preliminary
Related publications (available at www.krollbondratings.com):
CMBS: Single Borrower and Large Loan Rating Methodology
CMBS: CMBS Property Evaluation Guidelines
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 entitledBB-UBS Trust 2012-SHOW Rule 17g-7
Kroll Bond Rating Agency
Joseph Kelly, 646-731-2365
Keith Kockenmeister, 646-731-2349
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