Fitch Affirms FREMF 2012-K706 and Freddie Mac Pass-Through Certificates, Series K-706

  Fitch Affirms FREMF 2012-K706 and Freddie Mac Pass-Through Certificates,
  Series K-706

Business Wire

NEW YORK -- February 14, 2013

Fitch Ratings has affirmed six classes of FREMF 2012-K706 multifamily mortgage
pass-through certificates and three classes of Freddie Mac structured
pass-through certificates, series K-706. A detailed list of rating actions
follows at the end of this press release.

SENSITIVITY/RATING DRIVERS

The affirmations are based on the stable performance of the underlying
collateral pool. As of the January 2013 distribution date, the pool has had no
delinquent or specially serviced loans. The pool's aggregate principal balance
has been paid down by 0.3% to $1.22 billion from $1.23 billion at issuance.
Approximately 37% of the loans reported year-end (YE) 2011 financials and 44
of the loans (73% of the pool) reported year-to-date (YTD) September 2012
financials. The pool's overall net operating income (NOI) has been stable with
a 3% NOI increase compared to issuer underwriting at issuance.

The largest loan of the pool (10.0% of the pool) is secured by Crystal Plaza,
a 539-unit, high-rise apartment complex situated on approximately five acres
in Arlington, VA. The property was built in 1967 and underwent capital
improvements in 2003. The property benefits from attractive amenities,
proximity to Washington, D.C., and access to public transportation, employment
centers, retail shopping, and major thoroughfares. Amenities include an
outdoor swimming pool, barbecue grills and outdoor dining tables, 24-hour
concierge, two 24-hour fitness centers, internet lounge, central courtyard,
game room, business center, rooftop sundeck, conference room, library, two
laundry facilities, and garage parking. Occupancy was 91% as of September
2012.

The second largest loan (5.9% of the pool) is secured by Paradise Island, a
1,112-unit, 55-building apartment complex located in Jacksonville, FL. The
property was developed in four phases between 1990 and 1999 and renovated in
2010. Property amenities include four swimming pools, a community center,
leasing and management offices, laundry facilities, fitness centers,
racquetball, tennis and volleyball courts, a car wash, and garages. Occupancy
was 99% as of September 2012. Loan is part of an A ($62.03 million) and B note
($10.0 million) structure, wherein the B-Note is subordinate.

The third largest loan (3.7% of the pool) is secured by Cascade Ridge
Apartments, a 518-unit, 48-building multifamily property located in Federal
Way, WA. The property was built in 1989 and renovated from 2007-2008. The
property is situated on 29 acres, approximately 10 miles north of Tacoma and
features an attractive amenities package. The property is managed by FPI
Management Inc., which managed a portfolio of more than 60,000 units and 1,669
units locally at issuance. Occupancy was 93% as of December 2011.

Fitch affirms the following classes as indicated:

FREMF 2012-K706 Multifamily Mortgage Pass-Through Certificates

--$86.5 million class A-1 at 'AAAsf'; Outlook Stable;

--$933.0 million class A-2 at 'AAAsf'; Outlook Stable;

--$1.02 billion* class X1 at 'AAAsf'; Outlook Stable;

--$1.02 billion* class X2-A at 'AAAsf'; Outlook Stable;

--$71.4 million class B at 'Asf'; Outlook Stable;

--$30.4 million class C at 'BBBsf'; Outlook Stable.

Freddie Mac Structured Pass-Through Certificates, Series K-706

--$89.8 million class A-1 at 'AAAsf'; Outlook Stable;

--$933.0 million class A-2 at 'AAAsf'; Outlook Stable;

--$1.02 billion* class X1 at 'AAAsf'; Outlook Stable.

*Notional amount and interest only.

Of FREMF 2012-K706, Fitch does not rate the $193.0 million interest-only class
X2-B, the $193.0 million interest-only class X3, the $91.2 million class D, or
$10.0 million class P. Of the Freddie Mac Structured Pass-Through
Certificates, Series K-706, Fitch does not rate the $193.0 million
interest-only class X3.

Additional information on Fitch's criteria for analyzing U.S. CMBS
transactions is available in the Dec. 18, 2012 report, 'U.S. Fixed-Rate
Multiborrower CMBS Surveillance and Re-REMIC Criteria', which is available at
'www.fitchratings.com' under the following headers:

Structured Finance >> CMBS >> Criteria Reports

Additional information is available at 'www.fitchratings.com'. The ratings
above were solicited by, or on behalf of, the issuer, and therefore, Fitch has
been compensated for the provision of the ratings.

Applicable Criteria and Related Research:

--'Global Structured Finance Rating Criteria' (June 6, 2012);

--'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria'
(Dec. 18, 2012).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=679923

U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=696969

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS.
PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK:
HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING
DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S
PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND
METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF
CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL,
COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM
THE 'CODE OF CONDUCT' SECTION OF THIS SITE.

Contact:

Fitch Ratings
Primary Analyst
Martin Nunnally, +1-212-908-0871
Associate Director
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
or
Committee Chairperson
Mary MacNeill, +1-212-908-0785
Managing Director
or
Media Relations
Sandro Scenga, +1-212-908-0278
sandro.scenga@fitchratings.com
 
Press spacebar to pause and continue. Press esc to stop.