DBRS Confirms All Classes of J.P. Morgan Chase Commercial Mortgage Securities Trust 2012-C8

DBRS has today confirmed all classes of J.P. Morgan Chase Commercial Mortgage Securities Trust 2012-C8 as follows:

-- Class A-1 at AAA (sf)
-- Class A-2 at AAA (sf)
-- Class A-3 at AAA (sf)
-- Class A-SB 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 (sf)
-- Class C at A (sf)
-- Class EC at A (sf)
-- Class D at BBB (high) (sf)
-- Class E at BBB (low) (sf)
-- Class F at BB (sf)
-- Class G at B (sf)

Class EC is exchangeable with Class A-S, Class B and Class C (and vice versa). All trends are Stable. DBRS does not rate the first loss piece, Class NR.

The rating confirmations reflect the overall stable performance of the pool since issuance. The pool consists of 43 loans, secured by 84 multifamily and commercial properties. According to YE2013 reporting, the pool has a weighted-average debt service coverage ratio (DSCR) and weighted-average debt yield of 1.53 times (x) and 9.41%, respectively. The transaction has experienced 3.82% of collateral reduction since issuance as a result of scheduled amortization.

As of the August 2014 remittance, there is one loan, representing 0.6% of the current pool balance, on the servicer’s watchlist. The Holiday Inn Express West Bradenton loan is secured by a limited-service hotel in Bradenton, Florida. The loan was added to the servicer’s watchlist after the franchisor, InterContinental Hotels Group (IHG), issued a default letter to the borrower as a result of the subject failing to achieve an OSAT (overall satisfaction) score above the minimum requirement of 79.0 for two consecutive months. In response, the borrower is investing $300,000 worth of renovations to in an attempt to increase the OSAT score back to an acceptable level. Renovations include the removal of guest rooms with smoking, exterior painting, parking lot resurfacing and adding a second breakfast area. According to the servicer, the renovations are currently 80% complete. IHG extended the cure date to September 14, 2014, with a potential franchise termination date of November 14, 2014. Despite these issues, performance continues to be stable, as the YE2013 DSCR was 2.10x and the YE2013 net cash flow was 38% higher than the DBRS underwritten figure.
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 remaining loans in the pool. The August 2014 Monthly 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.

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.

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

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