DBRS Finalizes Ratings to UBS-B 2012-C3

DBRS has today assigned final ratings to the following classes of Commercial Mortgage Pass-Through Certificates, Series 2012-C3 (the Certificates), to be issued by UBS-Barclays Commercial Mortgage Trust. The trends are Stable.

– Class A-1 at AAA (sf)
– Class A-2 at AAA (sf)
– Class A-3 at AAA (sf)
– Class A-4 at AAA (sf)
– Class A-S at AAA (sf)
– Class X-A at AAA (sf)
– Class X-B at AAA (sf)
– Class B at AA (low) (sf)
– Class C at A (low) (sf)
– Class D at BBB (low) (sf)
– Class E at BB (sf)
– Class F at B (sf)

Classes A-S, X-A, X-B, B, C, D, E and F have been privately placed pursuant to Rule 144a.

The Class X-A and Class X-B balances are notional. DBRS ratings on interest-only certificates address the likelihood of receiving interest based on the notional amount outstanding. DBRS considers the interest-only certificate’s position within the transaction payment waterfall when determining the appropriate rating.

The collateral consists of 76 fixed-rate loans secured by 113 multifamily properties, mobile home parks and commercial properties. The portfolio has a balance of $1,082,061,969. The pool consists of relatively low-leverage financing, with a DBRS weighted-average term debt service coverage ratio (DSCR) and debt yield of 1.58 times (x) and 10.2%, respectively. Based on the DBRS sample of 31 loans, representing 69.6% of the pool, the loans were, in general, prudently underwritten. The average DBRS NCF variance was -4.1%. The refinance risk of the transaction is considered low, as the underlying loans will amortize 20.9% by their respective loan maturities. Furthermore, the pool has a WA DBRS exit debt yield of 13.0%. The pool has relatively high concentrations of retail (42.2% of the pool) and hotel properties (16.7% of the pool). However, the transaction’s retail assets have a WA DBRS Term DSCR of 1.50x, allowing for material deterioration of cash flows before there would be a debt service shortfall. Additionally, the pool’s hotel loans have a high WA DBRS Exit Debt Yield of 16.1%. DBRS considered the credit characteristics of two loans, representing 13.2% of the pool, to be consistent with investment-grade risk.

The ratings assigned to the Certificates by DBRS are based exclusively on the credit provided by the transaction structure and underlying trust assets. All classes will be subject to ongoing surveillance, which could result in upgrades or downgrades by DBRS after the date of issuance.

Notes:
All figures are in U.S. dollars unless otherwise noted.

This rating is endorsed by DBRS Ratings Limited for use in the European Union.

The applicable methodology is CMBS Rating Methodology, which can be found on our website under Methodologies.