CHICAGO--(BUSINESS WIRE)--Fitch Ratings has affirmed all rated classes of FREMF 2012-K21 multifamily mortgage pass-through certificates (FREMF 2012-K21) and Freddie Mac structured pass-through certificates, series K-021. A detailed list of rating actions follows at the end of this press release.
KEY RATING DRIVERS
The affirmations reflect stable performance since issuance. Fitch has designated one loan (2.6%) as a Fitch Loan of Concern, and there are no delinquent or specially serviced loans in the pool. Multifamily properties represent 98.7% of the pool. There is one co-op property (1.3% of the pool) located in the Murray Hill section of Manhattan.
The certificates represent the beneficial interests in a pool of 80 commercial mortgages secured by 80 properties. The Freddie Mac structured pass-through certificates, series K-021 (Freddie Mac SPC K-021) represents a pass-through interest in the corresponding class of the securities issued by FREMF 2012-K21 Mortgage Trust. Each Freddie Mac SPC K-021 security has the same designation as its underlying FREMF 2012-K21 class. All loans were originated by various seller/servicers according to the guidelines of the Freddie Mac Capital Markets Execution (CME) product. The certificates follow a sequential-pay structure. The affirmations of the Freddie Mac structured pass-through certificates, series K-021 certificates are the result of the pass-through nature of the certificates, as they are dependent on the underlying ratings of the corresponding classes of FREMF 2012-K21.
The loan designated as a Fitch Loan of Concern (2.6%) is secured by a 476-unit property located in Lisle, IL, which is approximately 30 miles west of the Chicago CBD. The property experienced major flooding due to rain in April 2013. The first floor lobby area, basement elevator lobby, elevators and interior lower level garage all sustained damages. After undergoing renovations with an estimated cost of $3.6 million, the property is now fully operational. As of March 2014, the servicer-reported occupancy and debt service coverage ratio (DSCR) were 95% and 1.69x, respectively.
The largest loan in the pool (4.8%) is secured by a 684-unit garden-style multifamily community located in Oakland Gardens, in the borough of Queens, NY. The property was built in 1949 with unit renovations being completed on an ongoing basis as they turn over. The property benefits from a J-51 real estate tax exemption and the majority of the units are subject to New York City's rent stabilization guidelines. The servicer-reported occupancy as of March 2014 was 99% compared to 98% at issuance.
The second largest loan (3.7%) is secured by a 422-unit mid-rise apartment complex located in Tampa, FL on 6.75 acres of land. The property is situated within the Channelside District, south of the Crosstown Expressway and the Tampa CBD, and west of the Port of Tampa. The year end 2013 occupancy and DSCR was reported to be 92% and 2.27x, respectively.
RATING SENSITIVITY
The Rating Outlooks remain Stable for all classes due to the transaction performing in-line with expectations at issuance. Additional information on rating sensitivity is available in the report 'FREMF 2012-K21 Multifamily Mortgage Pass-Through Certificates and Freddie Mac Structured Pass-Through Certificates, Series K-021' (Dec. 20, 2012), available at www.fitchratings.com.
Fitch affirms the following classes:
FREMF 2012-K21 Multifamily Mortgage Pass-Through Certificates
--$181.5 million class A-1 at 'AAAsf', Outlook Stable;
--$968.2 million class A-2 at 'AAAsf', Outlook Stable;
--$1.1 billion* class X1 at 'AAAsf', Outlook Stable;
--$1.1 billion* class X2-A at 'AAAsf', Outlook Stable;
--$68.4 million class B at 'Asf', Outlook Stable;
--$34.2 million class C at 'BBB+sf', Outlook Stable.
Freddie Mac Structured Pass-Through Certificates, Series K-021
--$181.5 million class A-1 at 'AAAsf', Outlook Stable;
--$968.2 million class A-2 at 'AAAsf', Outlook Stable;
--$1.1 billion* class X-1 at 'AAAsf', Outlook Stable.
*Notional amount and interest-only.
Of the FREMF 2012-K21 Multifamily Mortgage Pass-Through Certificates, Fitch does not rate the interest-only X2-B, interest only class X3 or the class D certificates.
Of the Freddie Mac Structured Pass-Through Certificates, Series K-021, Fitch does not rate the interest-only class X3.
A comparison of the transaction's Representations, Warranties, and Enforcement (RW&E) mechanisms to those of typical RW&Es for the asset class is available in the following report:
--'FREMF 2012-K21 Multifamily Mortgage Pass-Through Certificates and Freddie Mac Structured Pass-Through Certificates, Series K-021 - Appendix' (Dec. 20, 2012).
Additional information on Fitch's criteria for analyzing U.S. CMBS transactions is available in the Dec. 11, 2013 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'.
Applicable Criteria and Related Research:
--'Global Structured Finance Rating Criteria' (Aug. 4, 2014);
--'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria' (Dec. 11, 2013).
Applicable Criteria and Related Research:
Global Structured Finance Rating Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=754389
U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=724961
Additional Disclosure
Solicitation Status
http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=881455
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