DBRS Confirms 13 Classes of UBS-Citigroup Commercial Mortgage Trust, Series 2011-C1

DBRS has today confirmed 13 classes of UBS-Citigroup Commercial Mortgage Pass-Through Certificates, Series 2011-C1, as follows:

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

All trends are Stable.

The pool comprises 32 fixed-rate loans secured by 38 commercial properties. The transaction closed in December 2011 and, since issuance, the outstanding principal balance has been reduced by 2.9% as a result of loan amortization. As of the October 2014 remittance report, all 32 loans are reporting YE2013 financials with a weighted-average debt service coverage ratio (DSCR) of 1.16 times (x) and a weighted-average debt yield of 10.10%.

As of the October 2014 remittance report, there are five loans on the servicer’s watchlist, representing 15.9% of the current pool balance. The largest loan on the servicer’s watchlist is Poughkeepsie Galleria (Prospectus ID#2, 10.4% of the current pool balance). This loan is secured by the 691,325 sf portion of a 1.2 million sf regional mall in Poughkeepsie, New York. The loan was added to the servicer’s watchlist as the T-12 ending June 2014 DSCR was reported to be 1.04x, below the servicer’s required threshold of 1.05x. A cash sweep was also triggered because the Rollover Reserve Account was less than the required reserve balance of $2 million. Despite the servicer’s reported cash flow decline, the IRP financials indicate a YE2013 DSCR of 1.26x and an annualized Q2 2014 DSCR of 1.37x. The DBRS UW DSCR was 1.17x. According to the March 2014 rent roll, the property was 97.3% occupied. Based on an analysis of the 2013 and 2014 rent rolls, no major vacancies seem to have occurred in late 2013 that would have caused a significant cash flow decline. DBRS has asked for clarification regarding the servicer’s reported cash flow decline and will continue to monitor the loan.

In general, performance of the portfolio is considered to be in line with DBRS’s expectations at issuance, thereby supporting the ratings confirmations. For further information on the DBRS viewpoint for this pool, including commentary on the largest loans and additional detail on the loans on the servicer’s watchlist, please see the October 2014 Monthly Surveillance report for this transaction, which will be published shortly on the DBRS website at www.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.