DBRS Confirms Ratings of UBS-B 2012-C3

DBRS has today confirmed the ratings on the following classes of Commercial Mortgage Pass-Through Certificates, Series 2012-C3, issued by UBS-Barclays Commercial Mortgage Trust, 2012-C3:

-- 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 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)
-- Class X-A at AAA (sf)
-- Class X-B at AAA (sf)

All trends are Stable. DBRS does not rate the first lost piece, Class G.

The collateral consists of 76 fixed-rate loans secured by 113 commercial properties. As of the July 2014 remittance report, the pool has a balance of approximately $1.06 billion, representing a collateral reduction of approximately 2.45% since issuance in September 2012. Overall, the loans in the pool have reported stable performance since issuance.

As of the July 2014 remittance report, there are four loans on the servicer’s watchlist and no loans in special servicing.
The largest loan on the watchlist, Summit Village Apartments (Prospectus ID# 29, 1% of the pool) was added to the watchlist after the 2013 debt service coverage ratio (DSCR) dropped to 0.78 times (x) because of a decrease in occupancy. According to the servicer, over 50% of the residents are Fort Sill employees consisting of soldiers and civilians, who routinely move into and out of the subject. As of the June 2014 rent roll, the property has rebounded and is 87.3% occupied compared with the 66% occupancy rate at YE2013.

The second-largest loan on the watchlist is Canterbury Shopping Center (Prospectus ID#51, 0.57% of the pool), which was placed on the watchlist because of the YE2013 DSCR declining to 0.28x as a result of rent concessions to encourage leasing activity. According to the servicer, four new leases have been signed in the past quarter and all rent concessions have expired and tenants are paying full rent. The property is 86.7% occupied as of June 2014 and the property performance is expected to improve as a result of the recent leasing activity.

The DBRS analysis included an in-depth review of the top 15 loans and loans on the servicer’s watchlist, which represent approximately 57.8% of the current pool balance. Approximately 92.8% of the pool is reporting 2013 full year data, with the loans reporting a weighted-average DSCR of 1.60x and a weighted-average debt yield of 10.2%.

DBRS continues to monitor this transaction in its Monthly CMBS Surveillance Report, with additional information on the DBRS viewpoint for this transaction, including details on the largest loans in the pool. The August 2014 Monthly CMBS Surveillance Report for this transaction will be published shortly. If you are interested in receiving this report, contact us at info@dbrs.com.

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 methodologies are CMBS Rating Methodology (January 2012) and CMBS North American Surveillance Methodology (November 2012), which can be found on our website under Methodologies.

For more information on this credit or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.