ISSUER FREE WRITING PROSPECTUS | ||
FILED PURSUANT TO RULE 433 | ||
REGISTRATION STATEMENT NO.: 333-172366-05 | ||
Free Writing Prospectus
Preliminary Collateral Term Sheet
$[TBD]
(Approximate Aggregate Cut-off Date Balance of Mortgage Pool)
WFRBS Commercial Mortgage Trust 2012-C10
as Issuing Entity
Wells Fargo Commercial Mortgage Securities, Inc.
as Depositor
Wells Fargo Bank, National Association
The Royal Bank of Scotland plc
Liberty Island Group I LLC
Basis Real Estate Capital II, LLC
C-III Commercial Mortgage LLC
as Sponsors and Mortgage Loan Sellers
Commercial Mortgage Pass-Through Certificates
Series 2012-C10
Series 2012-C10
November 15, 2012
Wells Fargo Securities | RBS |
Co-Lead Manager and Co-Bookrunner | Co-Lead Manager and Co-Bookrunner |
Deutsche Bank Securities
Co-Manager
WFRBS Commercial Mortgage Trust 2012-C10 |
STATEMENT REGARDING THIS FREE WRITING PROSPECTUS
The depositor has filed a registration statement (including a prospectus) with the Securities and Exchange Commission (‘‘SEC’’) (SEC File No. 333-172366) for the offering to which this communication relates. Before you invest, you should read the prospectus in the registration statement and other documents the depositor has filed with the SEC for more complete information about the depositor, the issuing entity and this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the depositor, any underwriter, or any dealer participating in the offering will arrange to send you the prospectus after filing if you request it by calling toll free 1-800-745-2063 (8 a.m. – 5 p.m. EST) or by emailing wfs.cmbs@wellsfargo.com.
Nothing in this document constitutes an offer of securities for sale in any other jurisdiction where the offer or sale is not permitted. The information contained herein is preliminary as of the date hereof, supersedes any such information previously delivered to you and will be superseded by any such information subsequently delivered and ultimately by the final prospectus relating to the securities. These materials are subject to change, completion, supplement or amendment from time to time.
STATEMENT REGARDING CERTAIN ESTIMATES AND OTHER INFORMATION
This free writing prospectus contains certain forward-looking statements. If and when included in this free writing prospectus, the words “expects”, “intends”, “anticipates”, “estimates” and analogous expressions and all statements that are not historical facts, including statements about our beliefs or expectations, are intended to identify forward-looking statements. Any forward-looking statements are made subject to risks and uncertainties which could cause actual results to differ materially from those stated. Those risks and uncertainties include, among other things, declines in general economic and business conditions, increased competition, changes in demographics, changes in political and social conditions, regulatory initiatives and changes in customer preferences, many of which are beyond our control and the control of any other person or entity related to this offering. The forward-looking statements made in this free writing prospectus are made as of the date stated on the cover. We have no obligation to update or revise any forward-looking statement.
Wells Fargo Securities is the trade name for the capital markets and investment banking services of Wells Fargo & Company and its subsidiaries, including but not limited to Wells Fargo Securities, LLC, a member of NYSE, FINRA, NFA and SIPC; Wells Fargo Institutional Securities, LLC, a member of FINRA and SIPC; and Wells Fargo Bank, N.A. Wells Fargo Securities, LLC carries and provides clearing services for Wells Fargo Institutional Securities, LLC customer accounts.
RBS is a trade name for the investment banking business of RBS Securities Inc. (“RBSSI”). Securities, syndicated loan arranging, financial advisory and other investment banking activities are performed by RBSSI and their securities affiliates. Lending, derivatives and other commercial banking activities are performed by The Royal Bank of Scotland plc and their banking affiliates. RBSSI is a member of SIPC, FINRA and the NYSE.
IRS CIRCULAR 230 NOTICE
THIS FREE WRITING PROSPECTUS IS NOT INTENDED OR WRITTEN TO BE USED, AND CANNOT BE USED, FOR THE PURPOSE OF AVOIDING U.S. FEDERAL, STATE OR LOCAL TAX PENALTIES. THIS FREE WRITING PROSPECTUS IS WRITTEN AND PROVIDED BY THE DEPOSITOR IN CONNECTION WITH THE PROMOTION OR MARKETING BY THE DEPOSITOR AND THE CO-LEAD BOOKRUNNING MANAGERS OF THE TRANSACTION OR MATTERS ADDRESSED HEREIN. INVESTORS SHOULD SEEK ADVICE BASED ON THEIR PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR.
IMPORTANT NOTICE REGARDING THE OFFERED CERTIFICATES
The certificates to be backed in part by the assets described herein, and such assets, are subject to modification, revision and other changes any time prior to issuance or availability of a final prospectus, such certificates are offered on a “when, as and if issued” basis. Prospective investors should understand that, when considering the purchase of such certificates, a contract of sale will come into being no sooner than the date on which the relevant class of certificates has been priced and the underwriters have confirmed the allocation of certificates to be made to investors; any “indications of interest” expressed by any prospective investor, and any “soft circles” generated by the underwriters, will not create binding contractual obligations for such prospective investors, on the one hand, or the underwriters, the depositor or any of their respective agents or affiliates, on the other hand.
As a result of the foregoing, a prospective investor may commit to purchase certificates that have characteristics (including with respect to the underlying assets) that may change, and each prospective investor is advised that all or a portion of the certificates referred to in these materials may be issued without all or certain of the characteristics (including with respect to the underlying assets) described in these materials. The underwriters’ obligation to sell certificates to any prospective investor is conditioned on the certificates and the transaction having the characteristics described in these materials. If the underwriters determine that a condition is not satisfied in any material respect, such prospective investor will be notified, and neither the depositor nor the underwriters will have any obligation to such prospective investor to deliver any portion of the certificates which such prospective investor has committed to purchase, and there will be no liability between the underwriters, the depositor or any of their respective agents or affiliates, on the one hand, and such prospective investor, on the other hand, as a consequence of the non-delivery.
Each prospective investor has requested that the underwriters provide to such prospective investor information in connection with such prospective investor’s consideration of the purchase of the certificates to be backed in part by the assets described in these materials. These materials are being provided to each prospective investor for informative purposes only in response to such prospective investor’s specific request. The underwriters described in these materials may from time to time perform investment banking services for, or solicit investment banking business from, any company named in these materials. The underwriters and/or their affiliates or respective employees may from time to time have a long or short position in any security or contract discussed in these materials.
The information contained herein supersedes any previous such information delivered to any prospective investor and will be superseded by information delivered to such prospective investor prior to the time of sale.
IMPORTANT NOTICE RELATING TO AUTOMATICALLY-GENERATED EMAIL DISCLAIMERS
Any legends, disclaimers or other notices that may appear at the bottom of any email communication to which this free writing prospectus is attached relating to (1) these materials not constituting an offer (or a solicitation of an offer), (2) no representation that these materials are accurate or complete and may not be updated or (3) these materials possibly being confidential, are not applicable to these materials and should be disregarded. Such legends, disclaimers or other notices have been automatically generated as a result of these materials having been sent via Bloomberg or another system.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
Republic Plaza |
Loan Information | Property Information | |||||||
Mortgage Loan Seller: | Wells Fargo Bank, National Association | Single Asset/Portfolio: | Single Asset | |||||
Credit Assessment (DBRS/KBRA/Moody’s): | NR/NR/NR | Property Type(5): | Office | |||||
Original Principal Balance(1): | $125,000,000 | Specific Property Type: | CBD | |||||
Cut-off Date Principal Balance(1): | $125,000,000 | Location: | Denver, CO | |||||
% of Initial Pool Balance: | TBD | Size: | 1,302,107 SF | |||||
Loan Purpose: | Refinance | Cut-off Date Principal Balance Per Unit/SF(1): | $215.04 | |||||
Borrower Name: | BOP Republic Plaza I LLC and BOP Republic Plaza II LLC | Year Built/Renovated: | 1982/2002 | |||||
Sponsor: | Brookfield Office Properties | Title Vesting: | Fee | |||||
Mortgage Rate: | 4.240% | Property Manager: | Self-managed | |||||
Note Date: | November 2, 2012 | 3rd Most Recent Occupancy (As of): | 94.3% (12/31/2009) | |||||
Anticipated Repayment Date: | NAP | 2nd Most Recent Occupancy (As of): | 94.2% (12/31/2010) | |||||
Maturity Date: | December 1, 2022 | Most Recent Occupancy (As of): | 92.1% (12/31/2011) | |||||
IO Period: | 36 months | Current Occupancy (As of): | 94.5% (9/30/2012) | |||||
Loan Term (Original): | 120 months | |||||||
Seasoning: | 0 months | Underwriting and Financial Information: | ||||||
Amortization Term (Original): | 360 months | |||||||
Loan Amortization Type: | Interest-only, Amortizing Balloon | 3rd Most Recent NOI (As of): | $24,754,363 (12/31/2010) | |||||
Interest Accrual Method: | Actual/360 | 2nd Most Recent NOI (As of): | $24,258,113 (12/31/2011) | |||||
Call Protection: | L(24),D(92),O(4) | Most Recent NOI (As of): | $25,132,202 (TTM 6/30/2012) | |||||
Lockbox Type(2): | Hard/Upfront Cash Management | |||||||
Additional Debt(1): | Yes | U/W Revenues: | $43,855,093 | |||||
Additional Debt Type(1): | Pari Passu | U/W Expenses: | $16,311,223 | |||||
U/W NOI: | $27,543,870 | |||||||
Escrows and Reserves: | U/W NCF: | $25,543,693 | ||||||
U/W NOI DSCR(1): | 1.67x | |||||||
Type: | Initial | Monthly | Cap (If Any) | U/W NCF DSCR(1): | 1.55x | |||
Taxes | $3,495,886 | $499,412 | NAP | U/W NOI Debt Yield(1): | 9.8% | |||
Insurance(3) | $0 | Springing | NAP | U/W NCF Debt Yield(1): | 9.1% | |||
Replacement Reserves | $27,217 | $27,217 | NAP | As-Is Appraised Value: | $535,400,000 | |||
Deferred Maintenance(4) | $74,688 | $0 | NAP | As-Is Appraisal Valuation Date: | October 8, 2012 | |||
TI/LC(4) | $2,358,462 | $140,000 | $5,000,000 | Cut-off Date LTV Ratio(1): | 52.3% | |||
Rent Concession Reserve(4) | $238,060 | $0 | NAP | LTV Ratio at Maturity or ARD(1): | 45.5% | |||
(1) | The Republic Plaza Loan Combination, totalling $280,000,000, is comprised of two pari passu notes (Notes A-1 and A-2). Note A-1 (the “Republic Plaza Mortgage Loan”) had an original balance of $125,000,000, has an outstanding principal balance as of the Cut-off Date of $125,000,000 and will be contributed to the WFRBS 2012-C10 trust. Note A-2 (the “Republic Plaza Companion Loan”) had an original balance of $155,000,000 and is expected to be contributed to a future trust. Note A-2 will be the controlling interest of the Republic Plaza Loan Combination. All presented statistical information related to balances per square foot, loan-to-value ratio, debt service coverage ratio and debt yields are based on the Republic Plaza Loan Combination. |
(2) | A Cash Trap Event Period will commence upon the earlier of: (i) the occurrence and continuance of an event of default or (ii) the DSCR, tested quarterly, being less than 1.32x. A Cash Trap Event Period will expire upon: the cure of such event of default, or when the DSCR is 1.42x or greater for two consecutive calendar quarters. |
(3) | Monthly insurance deposits are not required as long as no event of default has occurred and is continuing, borrower provides evidence of an acceptable blanket insurance policy and the borrower provides the lender with proof of full payment in a timely manner. |
(4) | The sponsor posted a guaranty for all of the following: outstanding tenant improvements and leasing commissions, monthly tenant improvement and leasing commissions escrow deposits, a deferred maintenance deposit and outstanding tenant rent concessions. |
(5) | The collateral for the Republic Plaza Loan Combination also includes a non-contiguous 12-story parking garage with approximately 1,275 stalls located one block from the Republic Plaza property. |
The Mortgage Loan. The mortgage loan (the “Republic Plaza Loan Combination”) is evidenced by two pari passu notes (Note A-1 and Note A-2) that are secured by a first mortgage encumbering a 56-story office building and a non-contiguous 12-story parking garage structure located in Denver, Colorado (the “Republic Plaza Property”). The Republic Plaza Loan Combination was originated on November 2, 2012 by Wells Fargo Bank, National Association. The Republic Plaza Loan Combination had an original balance of $280,000,000 and accrues interest at an interest rate of 4.240% per annum. The Republic Plaza Loan Combination had an initial term of 120 months, has a remaining term of 120 months as of the Cut-off Date and requires interest-only payments for the first 36 payments following origination and thereafter requires payments of principal and interest based on a 30-year amortization schedule. The Republic Plaza Loan Combination matures on December 1, 2022.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
REPUBLIC PLAZA |
Note A-1 will be contributed to the WFRBS 2012-C10 Trust, had an original principal balance of $125,000,000 and has an outstanding principal balance as of the Cut-off Date of $125,000,000 (the “Republic Plaza Mortgage Loan”). Note A-2 had an original principal balance of $155,000,000, is expected to be securitized in a future trust and will represent the controlling interest in the Republic Plaza Loan Combination (the “Republic Plaza Companion Loan”).
Following the lockout period, the borrower will have the right to defease the Republic Plaza Loan Combination in whole, or in part, on any due date before the scheduled maturity date. In addition, the Republic Plaza Loan Combination is prepayable without penalty on or after September 1, 2022.
Sources and Uses
Sources | Uses | ||||||
Original loan combination amount | $280,000,000 | 100.0% | Loan payoff(1) | $152,426,276 | 54.4% | ||
Reserves | 3,023,691 | 1.1 | |||||
Closing costs | 13,800,000 | 4.9 | |||||
Return of equity | 110,750,033 | 39.6 | |||||
Total Sources | $280,000,000 | 100.0% | Total Uses | $280,000,000 | 100.0% |
(1) | The Republic Plaza Property was previously securitized in JPMCC 2004-C2. |
The Property. The Republic Plaza Property is a 56-story class A office building containing approximately 1,302,107 rentable square feet and a non-contiguous 12-story parking garage located one block southwest of the office property all located in the central business district of Denver, Colorado. Built in 1982, the Republic Plaza Property is the tallest building in Denver and is situated on a 2.3-acre parcel. The 12-story parking garage provides approximately 1,275 parking spaces and was built in 1982. Parking is also provided by a subterranean parking structure at the office property, which accounts for approximately 206 spaces and a parking ratio of 1.1 spaces per 1,000 square feet of rentable area. The Republic Plaza Property serves as the United States headquarters for Encana Oil & Gas, DCP Midstream, LP and Wheeler Trigg O’Donnell LLP. Tenancy also includes several wealth management divisions for financial institutions such as: Merrill Lynch, Citigroup, Bank of America, Morgan Stanley and UBS. As of September 30, 2012, the Republic Plaza Property was 94.5% leased to 58 tenants.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
REPUBLIC PLAZA |
The following table presents certain information relating to the tenancies at the Republic Plaza Property:
Major Tenants
Tenant Name | Credit Rating (Fitch/Moody’s/ S&P)(1) | Tenant NRSF | % of NRSF | Annual U/W Base Rent PSF | Annual U/W Base Rent | % of Total Annual U/W Base Rent | Lease Expiration Date |
Major Tenants | |||||||
Encana Oil & Gas | NR/Baa2/BBB | 452,972 | 34.8% | $20.55 | $9,308,575(2) | 36.0% | 4/30/2019(3)(4) |
DCP Midstream, LP | NR/NR/NR | 153,983 | 11.8% | $24.06 | $3,704,405 | 14.3% | 5/31/2016(5)(6) |
Wheeler Trigg O’Donnell LLP | NR/NR/NR | 77,264 | 5.9% | $20.61 | $1,592,420 | 6.2% | 1/31/2023(7) |
Venoco, Inc. | NR/NR/NR | 47,205 | 3.6% | $22.85 | $1,078,799 | 4.2% | 3/31/2014 |
Samson Resources | NR/NR/NR | 61,932 | 4.8% | $17.17 | $1,063,466 | 4.1% | 3/31/2021(8) |
The Gary Williams Company | NR/NR/NR | 38,612 | 3.0% | $20.13 | $777,230 | 3.0% | 7/31/2013 |
Merrill Lynch, Pierce, Fenner | A/Baa2/A- | 26,752 | 2.1% | $24.00 | $642,048 | 2.5% | 2/28/2018 |
Citigroup Global Markets | A/Baa2/A- | 29,770 | 2.3% | $20.03 | $596,293(9) | 2.3% | 6/30/2015(10) |
Total Major Tenants | 888,490 | 68.2% | $21.12 | $18,763,235 | 72.6% | ||
Non-Major Tenants | 342,507 | 26.3% | $20.65 | $7,072,674 | 24.4% | ||
Occupied Collateral Total | 1,230,997 | 94.5% | $20.99 | $25,835,908 | 100.0% | ||
Vacant Space | 71,110 | 5.5% | |||||
Collateral Total | 1,302,107 | 100.0% | |||||
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | The Annual U/W Base Rent was derived by averaging the annual contractual rental increases through the lease term. The current in-place rent is $17.50 per square foot. |
(3) | On or after February 1, 2013, Encana Oil & Gas (“Encana”) has a one-time right to surrender one or two full floors with 12 months notice provided: (i) the tenant is not subleasing more than 20% of their leased square footage; (ii) the surrendered floors are on floor 18 or higher; and (iii) Encana will pay an amount equal to six months of rent for surrendered spaces plus the unamortized cost of the landlord concessions as outlined in the lease agreement. |
(4) | If Encana does not renew its lease for 452,927 square feet at a term of no less than five years from the lease expiration date, or replacement lease(s) approved by the lender are not signed prior to June 30, 2017, the sponsor will post an escrow, letter of credit or a guaranty for $18,118,880 less the actual tenant improvements and leasing costs in connection with a replacement lease(s) or a renewed Encana lease. |
(5) | 10,543 square feet expires on September 14, 2014. |
(6) | DCP Midstream, LP may terminate its lease with respect to 10,543 square feet if the tenant renews its lease or expands on the 21st floor. |
(7) | Prior to March 31, 2017, Wheeler Trigg O’Donnell LLP has a one-time right to terminate its lease for one floor (approximately 25,221 square feet) of its leased space (but in no event less than 10,000 square feet). |
(8) | Samson Resources may terminate its lease any time after March 31, 2017 so as long as they are not in default under the terms of their lease and not subleasing more than 50% of their leased square footage. |
(9) | The Annual U/W Base Rent was derived by averaging the annual contractual rental increases through the lease term. The current in-place rent is $18.50 per square foot. |
(10) | Citigroup Global Markets has the right to terminate their lease with respect to 5,866 square feet after December 31, 2013. |
The following table presents certain information relating to the lease rollover schedule at the Republic Plaza Property:
Lease Expiration Schedule(1)(2)
Year Ending December 31, | No. of Leases Expiring | Expiring NRSF | % of Total NRSF | Cumulative Expiring NRSF | Cumulative % of Total NRSF | Annual U/W Base Rent | Annual U/W Base Rent PSF(3) | |
MTM | 0 | 0 | 0.0% | 0 | 0.0% | $0 | $0.00 | |
2012 | 1 | 11,121 | 0.9% | 11,121 | 0.9% | $155,694 | $14.00 | |
2013 | 20 | 62,740 | 4.8% | 73,861 | 5.7% | $1,388,160 | $22.13 | |
2014 | 13 | 81,845 | 6.3% | 155,706 | 12.0% | $1,758,307 | $21.48 | |
2015 | 12 | 63,465 | 4.9% | 219,171 | 16.8% | $1,355,588 | $21.36 | |
2016 | 17 | 173,324 | 13.3% | 392,495 | 30.1% | $4,121,196 | $23.78 | |
2017 | 6 | 22,230 | 1.7% | 414,725 | 31.9% | $452,425 | $20.35 | |
2018 | 11 | 54,538 | 4.2% | 469,263 | 36.0% | $1,142,484 | $20.95 | |
2019 | 28 | 501,315 | 38.5% | 970,578 | 74.5% | $10,207,506 | $20.36 | |
2020 | 7 | 38,286 | 2.9% | 1,008,864 | 77.5% | $881,196 | $23.02 | |
2021 | 13 | 114,800 | 8.8% | 1,123,697 | 86.3% | $2,159,058 | $18.81 | |
2022 | 3 | 4,848 | 0.4% | 1,128,512 | 86.7% | $117,560 | $24.25 | |
Thereafter | 5 | 102,485 | 7.9% | 1,230,997 | 94.5% | $2,147,282 | $20.95 | |
Vacant | 0 | 71,110 | 5.5% | 1,302,107 | 100.0% | $0 | $0.00 | |
Total/Weighted Average | 136 | 1,302,107 | 100.0% | $25,835,908 | $20.99 | |||
(1) | Information obtained from the underwritten rent roll. | |||||||
(2) | Certain tenants may have lease termination options that are exercisable prior to the stated expiration date of the subject lease and that are not considered in the Lease Expiration Schedule. | |||||||
(3) | Weighted Average Annual U/W Base Rent PSF excludes vacant space. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
REPUBLIC PLAZA |
The following table presents historical occupancy percentages at the Republic Plaza Property:
Historical Occupancy Percentages(1)
12/31/2009 | 12/31/2010 | 12/31/2011 | ||
94% | 94% | 92% | ||
(1) Information obtained from borrower rent rolls. |
Market Overview and Competition. According to the appraisal, the Republic Plaza Property is located at the northwest corner of 16th Street and Tremont Place in the central business district of Denver, Colorado. The Republic Plaza Property is located approximately 24 miles from Denver International Airport, the fifth busiest airport in the United States and the second largest in the world by land area. Access to the Republic Plaza Property is provided by the 16th Street Mall Shuttle, the Denver Regional Transport District bus line as well as Union Station, which is located approximately one mile away from the Republic Plaza Property. Denver’s central location in the country allows it to serve as a major transportation hub for the western United States and the largest employers are in the trade, transportation and utilities industries. As of year-end 2011, the unemployment rate for the Denver MSA was 8.6%.
According to the appraisal, the Republic Plaza Property is located within the central business district office submarket and the appraiser identified a competitive set that contains approximately 4.7 million square feet of office space. The submarket vacancy and market rental rate for the appraiser’s competitive set is approximately 9.9% and $26.11 per square foot on a triple net basis, respectively as of the second quarter of 2012.
The following table presents certain information relating to comparable office properties for the Republic Plaza Property:
Competitive Set(1)
Republic Plaza (Subject) | Tabor Center | 1801 California Street | Wells Fargo Center | 1900 Sixteenth Street | 1800 Larimer Street | Seventeenth Street Plaza | |
Location | Denver, CO | Denver, CO | Denver, CO | Denver, CO | Denver, CO | Denver, CO | Denver, CO |
Distance from Subject | -- | 1.3 miles | 0.7 miles | 0.1 miles | 1.4 miles | 1.1 miles | 1.3 miles |
Property Type | Office | Office | Office | Office | Office | Office | Office |
Year Built/Renovated | 1982/2002 | 1985/2000 | 1982/NAP | 1983/NAP | 2009/NAP | 2010/NAP | 1982/NAP |
Number of Stories | 52 | 30 | 52 | 52 | 18 | 22 | 32 |
Total GLA | 1,302,107 SF | 571,722 SF | 1,317,046 SF | 1,204,089 SF | 400,538 SF | 495,518 SF | 666,653 SF |
Total Occupancy | 95% | 98% | 40% | 88% | 87% | 88% | 90% |
(1) Information obtained from the appraisal dated October 8, 2012.
The Sponsor. The sponsor for the Republic Plaza Loan Combination is Brookfield Properties Investor Corporation, which is indirectly owned by Brookfield Office Properties (“BOP”). BOP is a publicly traded REIT (NYSE: BPO) headquartered in Toronto, Ontario and has ownership interests in 108 properties totaling approximately 78.0 million square feet located internationally in the downtown core markets of New York, Washington DC, Houston, Los Angeles, Denver, Toronto, Calgary, Ottawa, Melbourne and Sydney.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
Concord Mills |
Loan Information | Property Information | ||||||
Mortgage Loan Seller: | The Royal Bank of Scotland | Single Asset/Portfolio: | Single Asset | ||||
Credit Assessment (DBRS/KBRA/Moody’s): | NR/NR/NR | Property Type: | Retail | ||||
Original Principal Balance: | $110,000,000 | Specific Property Type: | Regional Mall | ||||
Cut-off Date Principal Balance: | $110,000,000 | Location: | Concord, NC | ||||
% of Initial Pool Balance: | TBD | Size: | 1,285,834 SF | ||||
Loan Purpose: | Refinance | Cut-off Date Principal Balance Per Unit/SF(1): | $85.55 | ||||
Borrower Name: | Mall at Concord Mills Limited Partnership | Year Built/Renovated: | 1999/NAP | ||||
Sponsor: | Simon Property Group, L.P. | Title Vesting: | Fee | ||||
Mortgage Rate: | 3.836% | Property Manager: | Simon Management Associates II, LLC | ||||
Note Date: | October 15, 2012 | 3rd Most Recent Occupancy (As of): | 92.1% (12/31/2009) | ||||
Anticipated Repayment Date: | NAP | 2nd Most Recent Occupancy (As of): | 95.9% (12/31/2010) | ||||
Maturity Date: | November 1, 2022 | Most Recent Occupancy (As of): | 96.6% (12/31/2011) | ||||
IO Period: | 120 months | Current Occupancy (As of)(5): | 98.3% (10/10/2012) | ||||
Loan Term (Original): | 120 months | ||||||
Seasoning: | 1 month | Underwriting and Financial Information: | |||||
Amortization Term (Original): | NAP | ||||||
Loan Amortization Type: | Interest-only, Balloon | 3rd Most Recent NOI (As of): | $27,847,975 (12/31/2010) | ||||
Interest Accrual Method: | Actual/360 | 2nd Most Recent NOI (As of): | $28,885,682 (12/31/2011) | ||||
Call Protection: | L(25),D(88),O(7) | Most Recent NOI (As of): | $28,947,661 (TTM 8/31/2012) | ||||
Lockbox Type: | Hard/Springing Cash Management | ||||||
Additional Debt(1): | Yes | U/W Revenues: | $41,169,453 | ||||
Additional Debt Type(1): | Pari Passu | U/W Expenses: | $11,273,235 | ||||
U/W NOI: | $29,896,218 | ||||||
U/W NCF: | $28,618,726 | ||||||
U/W NOI DSCR(1) : | 3.27x | ||||||
Escrows and Reserves: | U/W NCF DSCR(1): | 3.13x | |||||
U/W NOI Debt Yield(1): | 12.7% | ||||||
Type: | Initial | Monthly | Cap (If Any) | U/W NCF Debt Yield(1): | 12.2% | ||
Taxes(2) | $0 | Springing | NAP | As-Is Appraised Value: | $435,000,000 | ||
Insurance(3) | $0 | Springing | NAP | As-Is Appraisal Valuation Date: | September 24, 2012 | ||
Replacement Reserves(4) | $0 | Springing | $646,000 | Cut-off Date LTV Ratio(1): | 54.0% | ||
TI/LC Reserve(4) | $0 | Springing | $1,800,000 | LTV Ratio at Maturity or ARD(1): | 54.0% | ||
(1) | The Concord Mills Loan Combination, totalling $235,000,000, is comprised of two pari passu notes (Notes A-1 and Note A-2). Note A-2, (the “Concord Mills Mortgage Loan”), had an original balance of $110,000,000, has an outstanding principal balance as of the Cut-off Date of $110,000,000 and will be contributed to the WFRBS 2012-C10 Trust. Note A-1, (the “Concord Mills Loan”), had an original balance of $125,000,000 and is expected to be contributed to a future trust. All presented statistical information related to balances per square foot, loan-to-value, debt service coverage ratios, and debt yields are based on the Concord Mills Loan Combination. |
(2) | No monthly tax escrow is required so long as no Lockbox Event (as defined in the loan documents) has occurred or is continuing under the Concord Mills Loan Combination. |
(3) | No monthly insurance escrow is required so long as (i) no event of default has occurred or is continuing under the Concord Mills Loan Combination and (ii) the insurance required to be maintained by the borrower is effected under an acceptable blanket insurance policy. |
(4) | No monthly replacement reserve or tenant improvement and leasing commissions reserve is required so long as no Lockbox Event has occurred or is continuing. |
(5) | Occupancy excludes temporary and seasonal tenants. For the trailing 12-month period ending July 31, 2012, the average occupancy, inclusive of these tenants, was 99.4%. |
The Mortgage Loan. The mortgage loan (the “Concord Mills Loan Combination”) is evidenced by a two pari passu notes (Note A-1 and Note A-2) secured by a first mortgage encumbering a regional mall located in Concord, North Carolina (the “Concord Mills Property”). The Concord Mills Loan Combination was originated on October 15, 2012 by The Royal Bank of Scotland. The Concord Mills Loan Combination had an original principal balance of $235,000,000, has an outstanding principal balance as of the Cut-off Date of $235,000,000 and accrues interest at an interest rate of 3.836% per annum. The Concord Mills Loan Combination had an initial term of 120 months, has a remaining term of 119 months as of the Cut-off Date and requires interest-only payments through the term of the Concord Mills Loan Combination. The Concord Mills Loan Combination matures on November 1, 2022. Note A-2 will be contributed to the WFRBS 2012-C10 Trust, had an original principal balance of $110,000,000 and has an outstanding principal balance as of the Cut-off Date of $110,000,000 (the “Concord Mills Mortgage Loan”). Note A-1 had an original principal balance of $125,000,000, is expected to be contributed to a future trust, and will represent the controlling interest in the Concord Mills Loan Combination (the “Concord Mills Loan”).
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
CONCORD MILLS |
Following the lockout period, the borrower will have the right to defease the Concord Mills Loan Combination in whole, but not in part, on any due date before the scheduled maturity date. In addition, the Concord Mills Loan Combination is prepayable without penalty on or after May 1, 2022.
Sources and Uses
Sources | Uses | ||||||
Original loan combination amount | $235,000,000 | 100.0% | Loan payoff(1) | $155,524,336 | 66.2% | ||
Reserves | 0 | 0.0 | |||||
Closing costs | 883,389 | 0.4 | |||||
Return of equity | 78,592,275 | 33.4 | |||||
Total Sources | $235,000,000 | 100.0% | Total Uses | $235,000,000 | 100.0% |
(1) | The Concord Mills Property was previously securitized in JPMCC 2003-C1. |
The Property. The Concord Mills Property is an approximately 1.3 million square foot single-level, regional mall located across Interstate 85 from the Charlotte Motor Speedway in Concord, North Carolina, approximately 14 miles north of the Charlotte, North Carolina central business district. The Concord Mills Property is anchored by Bass Pro Shops Outdoor, Burlington Coat Factory, AMC Theatres and Dave & Buster’s. The Concord Mills Property opened in 1999 and as of October 10, 2012, the Concord Mills Property was 98.3% leased by approximately 151 tenants, excluding seasonal and temporary tenants. In-line stores include Saks Fifth Avenue Off 5th, Michael Kors, Polo Ralph Lauren Factory Store, Coach, Tommy Hilfiger, Forever 21, Nike Factory Outlet and more than 145 other retailers and restaurants. The five largest tenants, Bass Pro Shops Outdoor, Burlington Coat Factory, AMC Theatres, Dave & Buster’s and TJ Maxx & More (representing aggregately 33.0% of net rentable area and 20.6% of base rent), have been at the Concord Mills Property since the year it was developed in 1999. In aggregate, tenants representing a total of 48.8% of net rentable area have been at the Concord Mills Property since it was developed in 1999.
For the trailing 12-month period ending July 31, 2012, tenants had comparable in-line average sales (tenants occupying less than 10,000 square feet) of $417 per square foot. Occupancy costs for comparable tenants occupying less than 10,000 square feet averaged 11.0% for the trailing 12-month period ended July 31, 2012.
The following table presents certain information relating to the tenancies at the Concord Mills Property:
Major Tenants
Tenant Name | Credit Rating (Fitch/ Moody’s/ S&P)(1) | Tenant NRSF | % of NRSF | Annual U/W Base Rent PSF(2) | Annual U/W Base Rent(2) | % of Total Annual U/W Base Rent | Sales PSF(3) | Occupancy Cost(3)(4) | Lease Expiration Date | |
Anchor Tenants | ||||||||||
Bass Pro Shops Outdoor | NR/NR/NR | 134,790 | 10.5% | $9.09 | $1,225,000 | 5.1% | $348 | 2.7% | 9/10/2014 | |
Burlington Coat Factory | NR/B3/B- | 100,498 | 7.8% | $5.50 | $552,739 | 2.3% | $109 | 6.1% | 1/31/2015 | |
Total Anchor Tenants | 235,288 | 18.3% | $7.56 | $1,777,739 | 7.4% | |||||
Other Major Tenants | ||||||||||
AMC Theatres | NR/NR/NR | 83,732 | 6.5% | $21.00 | $1,758,372 | 7.3% | (5) | 17.8% | 9/30/2019 | |
Dave & Buster’s | NR/NR/NR | 53,077 | 4.1% | $18.00 | $955,386 | 4.0% | $148 | 15.8% | 8/28/2014 | |
Forever 21 | NR/NR/NR | 29,367 | 2.3% | $25.54 | $750,000 | 3.1% | $398 | 8.4% | 6/30/2022 | |
T.J. Maxx & More | NR/A3/A | 51,937 | 4.0% | $9.25 | $480,417 | 2.0% | $227 | 4.9% | 1/31/2015 | |
Bed Bath & Beyond | NR/NR/BBB+ | 35,515 | 2.8% | $10.25 | $364,029 | 1.5% | $243 | 4.8% | 1/31/2015 | |
Best Buy(6) | BB+/Baa2/BB+ | 35,807 | 2.8% | $9.00 | $322,263 | 1.3% | NAV | NAV | 1/31/2021 | |
Total Anchor Tenants | 289,435 | 22.5% | $16.00 | $4,630,467 | 19.2% | |||||
Non-Major Tenants | 738,697 | 57.4% | $23.93 | $17,675,703 | 73.4% | |||||
Occupied Collateral(7) | 1,263,420 | 98.3% | $19.06 | $24,083,909 | 100.0% | |||||
Vacant Space | 22,414 | 1.7% | ||||||||
Collateral Total | 1,285,834 | 100.0% | ||||||||
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | Underwritten base rent includes contractual rent steps through June 2013. |
(3) | Sales and occupancy costs are for the trailing 12-month period ending July 31, 2012. |
(4) | Occupancy costs include base rent, reimbursements and percentage rent as applicable. |
(5) | AMC Theatres operates with 24 screens at the Concord Mills Property and had sales per screen of $432,755 for the trailing 12-month period ending July 31, 2012. |
(6) | Best Buy is not required to report sales. |
(7) | Occupancy excludes temporary and seasonal tenants. For the trailing 12-month period ending July 31, 2012, the average occupancy, inclusive of these tenants, was 99.4%. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
CONCORD MILLS |
The following table presents certain information relating to the historical sales and occupancy costs at the Concord Mills Property:
Historical Sales (PSF) and Occupancy Costs(1)
Tenant Name | 2009 | 2010 | 2011 | TTM | |
Bass Pro Shops Outdoor | $333 | $330 | $347 | $348 | |
Burlington Coat Factory | $122 | $116 | $117 | $109 | |
AMC Theatres | (2) | (2) | (2) | (2) | |
Dave & Buster’s | $147 | $139 | $139 | $148 | |
Forever 21(3) | $565 | $565 | $691 | $398 | |
T.J. Maxx & More | $234 | $240 | $236 | $227 | |
Bed Bath & Beyond | $227 | $213 | $232 | $243 | |
Best Buy(4) | NAV | NAV | NAV | NAV | |
Total In-line (<10,000 square feet)(5) | $357 | $387 | $389 | $417 | |
Occupancy Costs(5) | 12.5% | 11.6% | 11.8% | 11.0% | |
(1) | Historical Sales (PSF) is based on historical statements provided by the borrower. | ||||
(2) | Sales per screen for AMC Theatres (24 screens) were $381,609, $423,684, $524,930 and $432,755 in 2009, 2010, 2011 and the trailing 12-month period ending July 31, 2012, respectively. | ||||
(3) | In 2012, Forever 21 expanded its space from 6,735 square feet (0.5% of net rentable square footage) to 29,367 square feet (2.3% of net rentable square footage). The TTM sales per square foot is based on the larger space, while 2009, 2010 and 2011 sales are based on the smaller space. | ||||
(4) | Best Buy is not required to report sales. | ||||
(5) | Represents tenants less than 10,000 square feet who were in occupancy since July 31, 2010, two years from the end of the trailing 12-month reporting period. |
The following table presents certain information relating to the lease rollover schedule at the Concord Mills Property:
Lease Expiration Schedule(1)(2)
Year Ending December 31, | No. of Leases Expiring | Expiring NRSF | % of Total NRSF | Cumulative Expiring NRSF | Cumulative % of Total NRSF | Annual U/W Base Rent | Annual U/W Base Rent PSF(3) |
MTM | 0 | 0 | 0.0% | 0 | 0.0% | $0 | $0.00 |
2012 | 6 | 11,287 | 0.9% | 11,287 | 0.9% | $461,889 | $40.92 |
2013 | 9 | 30,695 | 2.4% | 41,982 | 3.3% | $531,534 | $17.32 |
2014 | 27 | 311,345 | 24.2% | 353,327 | 27.5% | $4,968,410 | $15.96 |
2015 | 21 | 294,281 | 22.9% | 647,608 | 50.4% | $4,140,120 | $14.07 |
2016 | 16 | 83,196 | 6.5% | 730,804 | 56.8% | $1,742,723 | $20.95 |
2017 | 19 | 75,644 | 5.9% | 806,448 | 62.7% | $2,208,596 | $29.20 |
2018 | 6 | 48,458 | 3.8% | 854,906 | 66.5% | $1,257,428 | $25.95 |
2019 | 12 | 167,501 | 13.0% | 1,022,407 | 79.5% | $3,534,195 | $21.10 |
2020 | 9 | 39,627 | 3.1% | 1,062,034 | 82.6% | $1,022,813 | $25.81 |
2021 | 11 | 95,691 | 7.4% | 1,157,725 | 90.0% | $1,824,284 | $19.06 |
2022 | 13 | 70,735 | 5.5% | 1,228,460 | 95.5% | $1,976,407 | $27.94 |
Thereafter | 2 | 34,960 | 2.7% | 1,263,420 | 98.3% | $415,510 | $11.89 |
Vacant(4) | 0 | 22,414 | 1.7% | 1,285,834 | 100.0% | $0 | $0.00 |
Total/Weighted Average | 151 | 1,285,834 | 100.0% | $24,083,909 | $19.06 |
(1) | Information obtained from the underwritten rent roll. |
(2) | Certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date of the subject lease and that are not considered in the Lease Expiration Schedule. |
(3) | Weighted Average Annual U/W Base Rent PSF excludes vacant space. |
(4) | Occupancy excludes temporary and seasonal tenants. For the trailing 12-month period ending July 31, 2012, the average occupancy, inclusive of these tenants, was 99.4%. |
The following table presents historical occupancy percentages at the Concord Mills Property:
Historical Occupancy Percentages(1)(2)
12/31/2009 | 12/31/2010 | 12/31/2011 | ||
92% | 96% | 97% |
(1) | Information obtained from the borrower. |
(2) | Historical occupancy is presented exclusive of temporary tenants. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
CONCORD MILLS |
Market Overview and Competition. The Concord Mills Property is located in Concord, North Carolina, approximately 14 miles northeast of the Charlotte central business district. The Concord Mills Property is located in a commercial area approximately two miles west of Charlotte Motor Speedway, and 1.5 miles north of the intersection of Interstate 85 and Interstate 485.
Per the appraisal, population within a fifteen-mile radius of the Concord Mills Property (the primary trade area) was recorded as 828,654 in 2012, representing a 2.7% compounded annual growth rate since 2000. Within the same radius, average household income was recorded as $66,287 in 2012, representing a 1.0% compounded annual growth rate since 2000, which compares favorably to both the Charlotte central business district and national average household income of $69,255 and $67,303, respectively.
The appraiser estimated triple net market rent for in-line retail suites under 10,000 square feet to be $25.83 per square foot, excluding kiosk, restaurant and jewelry tenants. Additionally, based on an average of comparable properties, the appraiser projected a vacancy rate of four percent based on historical occupancy at the Concord Mills Property and the occupancy levels of competitive properties.
The following table presents certain information relating to some comparable retail centers provided in the appraisal for the Concord Mills Property:
Competitive Set(1)
Concord Mills (Subject) | Afton Ridge SC | Shoppes at University Place | Carolina Mall | Northlake Mall | |
Market | Concord, NC | Concord, NC | Charlotte, NC | Concord, NC | Charlotte, NC |
Distance from Subject | –– | 5.0 miles | 6.0 miles | 10.0 miles | 11.0 miles |
Property Type | Regional Mall | Anchored | Anchored | Regional Mall | Regional Mall |
Year Built/Renovated | 1999/NAP | 2006/NAV | 1984/2011 | 1972/1999 | 2005/NAV |
Anchors | Bass Pro Shops Outdoor, Burlington Coat, AMC Theatre, TJ Maxx | Target, Dick’s, Best Buy, Marshall’s | Dick’s, Office Depot, Old Navy, TJ Maxx | Belk, JC Penney’s, Sears | Belk, Dick’s, Dillard’s, Hecht’s, AMC Theatres |
Total GLA | 1,285,834 SF | 503,366 SF | 801,295 SF | 554,270 SF | 1,096,719 SF |
Total Occupancy | 98% | 98% | 76% | 99% | 98% |
(1) | Information obtained from the appraisal dated October 4, 2012. |
The Sponsor. The sponsor for the Concord Mills Mortgage Loan is Simon Property Group, L.P. (“SPG”). SPG is a large real estate company in the United States and is publicly traded on the New York Stock Exchange under the symbol SPG. SPG currently owns or has an interest in 337 properties comprising 245 million square feet of gross leasable area in North America, Europe and Asia. SPG employs over 5,500 people in the United States and is headquartered in Indianapolis, Indiana.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
Dayton Mall | |||||||
Loan Information | Property Information | ||||||
Mortgage Loan Seller: | Wells Fargo Bank, National Association | Single Asset/Portfolio: | Single Asset | ||||
Credit Assessment (DBRS/KBRA/Moody’s): | NR/NR/NR | Property Type: | Retail | ||||
Original Principal Balance: | $82,000,000 | Specific Property Type: | Regional Mall | ||||
Cut-off Date Principal Balance: | $82,000,000 | Location: | Dayton, OH | ||||
% of Initial Pool Balance: | TBD | Size: | 778,487 SF | ||||
Loan Purpose: | Refinance | Cut-off Date Principal Balance Per Unit/SF: | $105.33 | ||||
Borrower Name: | Dayton Mall II, LLC | Year Built/Renovated: | 1970/2012 | ||||
Sponsor: | Glimcher Properties Limited Partnership | Title Vesting: | Fee | ||||
Mortgage Rate: | 4.570% | Property Manager: | Glimcher Properties Limited Partnership; Glimcher Development Corporation | ||||
Note Date: | August 22, 2012 | 3rd Most Recent Occupancy (As of): | 94.2% (12/31/2009) | ||||
Anticipated Repayment Date: | NAP | 2nd Most Recent Occupancy (As of): | 96.1% (12/31/2010) | ||||
Maturity Date: | September 1, 2022 | Most Recent Occupancy (As of): | 94.9% (12/31/2011) | ||||
IO Period: | 60 months | Current Occupancy (As of): | 92.2% (7/24/2012) | ||||
Loan Term (Original): | 120 months | ||||||
Seasoning: | 3 months | Underwriting and Financial Information: | |||||
Amortization Term (Original): | 360 months | ||||||
Loan Amortization Type: | Interest-only, Amortizing Balloon | 3rd Most Recent NOI (As of): | $10,544,377 (12/31/2010) | ||||
Interest Accrual Method: | Actual/360 | 2nd Most Recent NOI (As of): | $10,438,840 (12/31/2011) | ||||
Call Protection: | L(27),D(89),O(4) | Most Recent NOI (As of): | $10,437,303 (TTM 6/30/2012) | ||||
Lockbox Type: | Hard/Upfront Cash Management | ||||||
Additional Debt: | None | ||||||
Additional Debt Type: | NAP | U/W Revenues: | $18,220,700 | ||||
U/W Expenses: | $8,025,764 | ||||||
Escrows and Reserves: | U/W NOI: | $10,194,936 | |||||
U/W NCF: | $9,457,177 | ||||||
Type: | Initial | Monthly | Cap (If Any) | U/W NOI DSCR: | 2.03x | ||
Taxes(1) | $0 | Springing | NAP | U/W NCF DSCR: | 1.88x | ||
Insurance(1) | $0 | Springing | NAP | U/W NOI Debt Yield: | 12.4% | ||
Replacement Reserves(2) | $0 | Springing | NAP | U/W NCF Debt Yield: | 11.5% | ||
Deferred Maintenance | $1,517,001 | $0 | NAP | As-Is Appraised Value: | $125,000,000 | ||
TI/LC(3) | $0 | Springing | NAP | As-Is Appraisal Valuation Date: | April 25, 2012 | ||
Dress Barn Reserve(4) | $456,667 | $0 | NAP | Cut-off Date LTV Ratio: | 65.6% | ||
Dick’s Sporting Goods Reserve(5) | $3,711,437 | $0 | NAP | LTV Ratio at Maturity or ARD: | 60.1% | ||
(1) | The loan documents do not require monthly escrows for real estate taxes or insurance provided a Cash Trap Event Period (defined as an event of default or the U/W NOI Debt Yield falling below 9.75%) does not exist. |
(2) | Monthly Replacement Reserves are not required as long as the actual debt service coverage ratio is greater than or equal to 1.75x. In the event the actual debt service coverage ratio is less than 1.75x, the borrower is required to deposit monthly replacement reserves in an amount equal to $12,975. |
(3) | Monthly TI/LC reserves are not required as long as the actual debt service coverage ratio is greater than or equal to 1.75x. In the event the actual debt service coverage ratio is less than 1.75x, the borrower is required to deposit monthly TI/LC reserves in an amount equal to $57,091. |
(4) | The upfront Dress Barn Reserve is related to outstanding tenant improvements allowances and leasing commissions for Dress Barn. |
(5) | The Dick’s Sporting Goods Reserve is related to the remaining cost of construction of the Dick’s Sporting Good’s space, five months of Dick’s Sporting Goods rent and outstanding leasing commissions. Dick’s Sporting Goods opened on November 7, 2012. This reserve is likely to be released in the near term. |
The Mortgage Loan. The mortgage loan (the “Dayton Mall Mortgage Loan”) is evidenced by a single promissory note that is secured by a first mortgage encumbering a regional mall located in Dayton, Ohio (the “Dayton Mall Property”). The Dayton Mall Mortgage Loan was originated on August 22, 2012 by Wells Fargo Bank, National Association. The Dayton Mall Mortgage Loan had an original principal balance of $82,000,000, has an outstanding principal balance as of the Cut-off Date of $82,000,000 and accrues interest at an interest rate of 4.570% per annum. The Dayton Mall Mortgage Loan had an initial term of 120 months, has a remaining term of 117 months as of the Cut-off Date and requires interest-only payments for the first 60 months following origination and thereafter requires payments of principal and interest based on a 30-year amortization schedule. The Dayton Mall Mortgage Loan will mature on September 1, 2022.
Following the lockout period, the borrower will have the right to defease the Dayton Mall Mortgage Loan in whole, but not in part, on any due date before the scheduled maturity date. In addition, the Dayton Mall Mortgage Loan is prepayable without penalty on or after June 1, 2022.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
DAYTON MALL |
Sources and Uses(1)
Sources | Uses | ||||||||
Original trust loan amount | $82,000,000 | 100.0% | Loan payoff(2) | $50,031,597 | 61.0 | % | |||
Reserves | 5,685,105 | 6.9 | |||||||
Return of equity | 26,283,298 | 32.1 | |||||||
Total Sources | $82,000,000 | 100.0% | Total Uses | $82,000,000 | 100.0 | % |
(1) | The sponsor has approximately $58.2 million of cash equity remaining in the Dayton Mall Property based on a cost basis of $140.2 million. |
(2) | The debt on the Dayton Mall Property was previously held by KeyBank National Association. |
The Property. The Dayton Mall Property is an enclosed two-story regional mall located in Dayton, Ohio, which is anchored by Macy’s (not part of the collateral), Elder Beerman (not part of the collateral), Sears (not part of the collateral) and JC Penney that contains approximately 1.4 million square feet of which 778,487 square feet secures the Dayton Mall Mortgage Loan. The property is situated on 56.3 acres and was built in 1970. The Dayton Mall Property was renovated in 1984, 1996, 2006 and 2012. The 2006 renovation included the addition of an 85,000 square foot lifestyle component, which the sponsor invested approximately $30.0 million to complete. The 2012 renovation includes the construction of a Dick’s Sporting Goods, which opened November 7, 2012. Parking is provided by 5,748 surface spaces resulting in a parking ratio of four spaces per every 1,000 square feet of gross leasable area. The Dayton Mall Property’s mix of in-line tenants includes American Eagle, Express, Aeropostale, Victoria’s Secret and Forever 21. For the trailing 12-month period ending August 31, 2012, comparable in-line sales (for tenants occupying less than 10,000 square feet) averaged $315 per square foot and for the same period comparable in-line occupancy costs (for tenants occupying less than 10,000 square feet) averaged 11.6%. As of July 24, 2012, the Dayton Mall Property was 92.2% leased.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
DAYTON MALL |
The following table presents certain information relating to the tenancies at the Dayton Mall Property:
Major Tenants
Tenant Name | Credit Rating (Fitch/ Moody’s/ S&P)(1) | Tenant NRSF | % of NRSF | Annual U/W Base Rent PSF | Annual U/W Base Rent | % of Total Annual U/W Base Rent | Sales PSF(2) | Occupancy Cost(2)(3) | Lease Expiration Date | |
Anchor Tenant – Not Part of Collateral | ||||||||||
Macy’s | BBB/Baa3/BBB | 268,943 | ANCHOR-OWNED - NOT PART OF THE COLLATERAL | |||||||
Elder Beerman | B-/B3/B- | 203,548 | ANCHOR-OWNED - NOT PART OF THE COLLATERAL | |||||||
Sears | B/B3/CCC+ | 185,790 | ANCHOR-OWNED - NOT PART OF THE COLLATERAL | |||||||
Anchor Tenants – Collateral | ||||||||||
JC Penney | BB-/Ba3/B+ | 178,686 | 23.0% | $4.27 | $762,552 | 7.1% | $134 | 3.3% | 3/31/2016 | |
Dick’s Sporting Goods | NR/NR/NR | 50,000 | 6.4% | $11.25 | $562,500 | 5.3% | NAV(4) | NAV(4) | 10/31/2022 | |
Total Anchor Tenants - Collateral | 228,686 | 29.4% | $5.79 | $1,325,052 | 12.4% | |||||
Major Tenants - Collateral | ||||||||||
DSW Shoe Warehouse | NR/NR/NR | 22,314 | 2.9% | $16.00 | $357,024 | 3.3% | NAV(5) | NAV(5) | 1/31/2023 | |
Osterman’s Jewelers | NR/NR/NR | 2,468 | 0.3% | $101.30 | $250,000 | 2.3% | $668 | 18.4% | 1/31/2015 | |
Forever 21 | NR/NR/NR | 11,358 | 1.5% | $22.00 | $249,876 | 2.3% | $247 | 15.5% | 8/31/2013 | |
Ulta Cosmetics | NR/NR/NR | 9,461 | 1.2% | $26.00 | $245,986 | 2.3% | $329 | 10.5% | 8/31/2017 | |
Old Navy | BBB-/Baa3/BB+ | 17,276 | 2.2% | $14.00 | $241,864 | 2.3% | $260 | 5.4% | 7/31/2015 | |
Total Major Tenants – Collateral | 62,877 | 8.1% | $21.39 | $1,344,750 | 12.6% | |||||
Non-Major Tenants - Collateral | 426,587 | 54.8% | $18.85 | $8,039,630 | 75.1% | |||||
Occupied Collateral Total | 718,150 | 92.2% | $14.91 | $10,709,432 | 100.0% | |||||
Vacant Space | 60,337 | 7.8% | ||||||||
Collateral Total | 778,487 | 100.0% | ||||||||
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | Sales and occupancy costs are for the trailing 12-month period ending August 31, 2012. |
(3) | Occupancy costs include base rents and reimbursements, as applicable. |
(4) | Sales and occupancy costs are unavailable as Dick’s Sporting Goods recently opened on November 7, 2012. An upfront reserve is in place related to the cost of construction of the Dick’s Sporting Good’s space, five months of Dick’s Sporting Goods rent and outstanding leasing commissions. |
(5) | Sales and occupancy costs are unavailable for the full trailing 12 months as DSW Shoe Warehouse was relocated in February 2012 as a result of the Dick’s Sporting Goods construction. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
DAYTON MALL |
The following table presents certain information relating to the historical sales and occupancy costs at the Dayton Mall Property:
Historical Sales (PSF) and Occupancy Costs(1)
Tenant Name | 2009 | 2010 | 2011 | TTM 8/31/2012 |
Macy’s | NAV | NAV | NAV | NAV |
Elder Beerman | NAV | NAV | NAV | NAV |
Sears | NAV | NAV | NAV | NAV |
JC Penney | $141 | $136 | $135 | $134 |
Dick’s Sporting Goods(2) | NAP | NAP | NAP | NAP |
Total In-line (<10,000 square feet)(3)(4) | $287 | $298 | $307 | $315 |
Occupancy Costs(3)(4) | NAV | NAV | NAV | 11.6% |
(1) | Historical Sales (PSF) is based on historical statements provided by the borrower. |
(2) | Sales and occupancy costs are unavailable as the Dick’s Sporting Goods recently opened on November 7, 2012. |
(3) | Represents tenants less than 10,000 square feet who were in occupancy the past three reporting periods and reported a full 12 months of sales. Excludes all major tenants, kiosks and tenants that did not report 12 months of sales. |
(4) | Historical in-line tenant rent and reimbursements have changed due to rent steps and fluctuation in CAM charges. Historical rent rolls are not available, therefore reliable historical occupancy costs cannot be calculated. |
The following table presents certain information relating to the lease rollover schedule at the Dayton Mall Property:
Lease Expiration Schedule(1)(2)
Year Ending December 31, | No. of Leases Expiring | Expiring NRSF | % of Total NRSF | Cumulative Expiring NRSF | Cumulative % of Total NRSF | Annual U/W Base Rent | Annual U/W Base Rent PSF(3) |
MTM | 0 | 0 | 0.0% | 0 | 0.0% | $0 | $0.00 |
2012 | 10 | 17,282 | 2.2% | 17,282 | 2.2% | $146,000 | $8.45 |
2013 | 21 | 56,387 | 7.2% | 73,669 | 9.5% | $853,955 | $15.14 |
2014 | 22 | 54,047 | 6.9% | 127,716 | 16.4% | $1,285,367 | $23.78 |
2015 | 24 | 89,473 | 11.5% | 217,189 | 27.9% | $1,626,409 | $18.18 |
2016 | 16 | 244,938 | 31.5% | 462,127 | 59.4% | $2,458,903 | $10.04 |
2017 | 17 | 69,731 | 9.0% | 531,858 | 68.3% | $1,531,415 | $21.96 |
2018 | 7 | 19,097 | 2.5% | 550,955 | 70.8% | $558,785 | $29.26 |
2019 | 2 | 11,511 | 1.5% | 562,466 | 72.3% | $361,567 | $31.41 |
2020 | 8 | 54,873 | 7.0% | 617,339 | 79.3% | $521,079 | $9.50 |
2021 | 2 | 5,069 | 0.7% | 622,408 | 80.0% | $190,000 | $37.48 |
2022 | 4 | 67,428 | 8.7% | 689,836 | 88.6% | $708,928 | $10.51 |
Thereafter | 2 | 28,314 | 3.6% | 718,150 | 92.2% | $467,024 | $16.49 |
Vacant | 0 | 60,337 | 7.8% | 778,487 | 100.0% | $0 | $0.00 |
Total/Weighted Average | 135 | 778,487 | 100.0% | $10,709,432 | $14.91 |
(1) | Information obtained from the underwritten rent roll. |
(2) | Certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date of the subject lease and that are not considered in the Lease Expiration Schedule. |
(3) | Weighted Average Annual U/W Base Rent PSF excludes vacant space. |
The following table presents historical occupancy percentages at the Dayton Mall Property:
Historical Occupancy Percentages(1)
12/31/2009 | 12/31/2010 | 12/31/2011 | ||
94% | 96% | 95% | ||
(1) Information obtained from borrower rent rolls. |
Market Overview and Competition. According to the appraisal, the Dayton Mall Property is located in the Dayton, Ohio MSA. The Dayton Mall Property is located at the intersection of Interstate 75 and Interstate 675, approximately 11 miles south of the Dayton central business district. Dayton is home to three large universities: The University of Dayton, Wright State University and Miami University, which report student enrollments of approximately 11,000, 18,000 and 17,000, respectively. Dayton is also home to Wright Patterson Air Force Base, one of the largest bases in the Air Force. Wright Patterson Air Force Base is headquarters for the Air Force Materiel Command and is also the location of the Wright-Patterson Medical Center, along with the National Museum of the United States Air Force. The population within a five-mile and ten-mile radius of the Dayton Mall Property is 130,006 and 406,558, respectively. The average household income within the same five-mile and ten-mile radii is $74,522 and $63,335, respectively.
According to the appraisal, the Dayton Mall Property’s competitive set consists of six regional malls/lifestyle centers. The appraiser concluded to a competitive property vacancy of 7.0%, and an overall market rent of $14.13 per square foot triple-net.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
DAYTON MALL |
The following table presents certain information relating to some comparable retail centers provided in the appraisal for the Dayton Mall Property:
Competitive Set(1)
Dayton Mall (Subject) | The Greene | The Mall at Fairfield Commons | Cincinnati Premium Outlets | Upper Valley Mall | Miami Valley Centre Mall | |
Location | Dayton, OH | Dayton, OH | Beavercreek, OH | Monroe, OH | Springfield, OH | Piqua, OH |
Distance from Subject | -- | 10.5 miles | 17.5 miles | 17.8 miles | 35.7 miles | 40.0 miles |
Property Type | Regional Mall | Lifestyle Center | Regional Mall | Outlet Center | Regional Mall | Regional Mall |
Year Built/Renovated | 1970/2012 | 2006/2008 | 1993/2006 | 2009/NAV | 1971/2003 | 1988/NAV |
Anchors | Macy’s, Elder Beerman, Sears, JC Penney, Dick’s | Von Maur, Cinema Delux | Elder Beerman, JC Penney, Sears, Macy’s | NAP | Elder Beerman, JC Penney, Macy’s, Sears | Elder Beerman, JC Penney, Sears |
Total GLA | 1,435,743 SF | 790,000 SF | 1,052,640 SF | 425,000 SF | 728,913 SF | 564,167 SF |
Total Occupancy | 92% | 89% | 94% | 92% | 97% | 89% |
(1) | Information obtained from the appraisal dated April 25, 2012. |
The Sponsor. The sponsor for the Dayton Mall Mortgage Loan is Glimcher Properties Limited Partnership, a subsidiary of Glimcher Realty Trust (“Glimcher”). Based in Columbus, Ohio, Glimcher was formed in 1994 to continue and expand the operations of The Glimcher Company, initially founded in 1959 by Herbert Glimcher. Glimcher owns and/or manages a total of 28 properties in 15 states aggregating approximately 21.6 million square feet of gross leasable area. Of the 28 properties, 25 are enclosed and open-air regional shopping centers.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
STAG REIT Portfolio | |||||||
Loan Information | Property Information | ||||||
Mortgage Loan Seller: | Wells Fargo Bank, National Association | Single Asset/Portfolio: | Portfolio | ||||
Credit Assessment (DBRS/KBRA/Moody’s): | NR/NR/NR | Property Type: | Industrial | ||||
Original Principal Balance: | $68,815,340 | Specific Property Type: | Various – See Table | ||||
Cut-off Date Principal Balance: | $68,815,340 | Location: | Various – See Table | ||||
% of Initial Pool Balance: | TBD | Size: | 3,630,021 SF | ||||
Loan Purpose: | Acquisition | Cut-off Date Principal Balance Per Unit/SF: | $18.96 | ||||
Borrower Name(1): | Various | Year Built/Renovated: | Various – See Table | ||||
Sponsor: | STAG Industrial Operating Partnership, L.P. | Title Vesting: | Fee | ||||
Mortgage Rate: | 4.310% | Property Manager(5): | Various | ||||
Note Date: | November 8, 2012 | 3rd Most Recent Occupancy (As of): | 98.8% (12/31/2009) | ||||
Anticipated Repayment Date: | NAP | 2nd Most Recent Occupancy (As of): | 98.7% (12/31/2010) | ||||
Maturity Date: | December 1, 2022 | Most Recent Occupancy (As of): | 98.5% (12/31/2011) | ||||
IO Period: | None | Current Occupancy (As of)(6): | 98.0% (8/30/2012) | ||||
Loan Term (Original): | 120 months | ||||||
Seasoning: | 0 months | Underwriting and Financial Information: | |||||
Amortization Term (Original): | 300 months | ||||||
Loan Amortization Type: | Amortizing Balloon | 3rd Most Recent NOI (As of): | $11,370,085 (12/31/2010) | ||||
Interest Accrual Method: | Actual/360 | 2nd Most Recent NOI (As of): | $12,022,549 (12/31/2011) | ||||
Call Protection(2): | L(24),D or YM(92),O(4) | Most Recent NOI (As of): | $11,786,488 (TTM 6/30/2012) | ||||
Lockbox Type: | Hard/Springing Cash Management | ||||||
Additional Debt: | None | U/W Revenues: | $14,779,119 | ||||
Additional Debt Type: | NAP | U/W Expenses: | $5,325,758 | ||||
U/W NOI: | $9,453,362 | ||||||
Escrows and Reserves: | U/W NCF: | $7,982,119 | |||||
U/W NOI DSCR : | 2.10x | ||||||
Type: | Initial | Monthly | Cap (If Any) | U/W NCF DSCR: | 1.77x | ||
Taxes(3) | $0 | Springing | NAP | U/W NOI Debt Yield: | 13.7% | ||
Insurance(3) | $0 | Springing | NAP | U/W NCF Debt Yield: | 11.6% | ||
Replacement Reserves(3) | $0 | Springing | $544,503 | As-Is Appraised Value: | $107,340,000 | ||
TI/LC | $800,000 | $77,228 | $2,100,000 | As-Is Appraisal Valuation Date(7): | Various | ||
Perrigo Holland Reserve(4) | $60,000 | $0 | NAP | Cut-off Date LTV Ratio: | 64.2% | ||
Deferred Maintenance | $822,964 | $0 | NAP | LTV Ratio at Maturity or ARD: | 46.8% | ||
(1) | The borrower is comprised of 28 separate limited liability companies. |
(2) | Yield maintenance is only applicable to a partial release. |
(3) | Ongoing monthly escrows for taxes, insurance and replacement reserves are not required as long as no Trigger Event exists and is ongoing. A “Trigger Event” will commence upon the earlier of (i) the occurrence and continuance of an event of default or (ii) the NCF debt service coverage ratio (“DSCR”) being less 1.35x. A Trigger Event will expire upon (i) the cure of such event of default or (ii) the NCF DSCR being equal to or greater than 1.35x for two consecutive calendar quarters. |
(4) | Represents tenant electrical work owed to Perrigo Holland, Inc. |
(5) | Of the 28 properties, 12 are managed by local and regional third party management companies, while the remaining 16 properties are managed by their respective tenants who, by the terms of their leases, are responsible for maintaining and managing the buildings they occupy. The following eight properties are managed by CBRE-Albany Property Management, LLC: 109 Balzano Drive, 122 Balzano Drive, 125 Balzano Drive, 141 Sal Landrio Drive, 123 Union Avenue, 150 Enterprise Road, 231 Enterprise Road and 6 Clermont Street. The 100 Papercraft Park property is managed by Jones Lang LaSalle America, Inc. The 4757 128th Avenue property is managed by NAI Wisinki of West Michigan, Inc. The 2510 Eastmoor Drive and 2652 Eastmoor Drive properties are managed by Weigand-Omega Management, Inc. |
(6) | Current Occupancy includes Thyssen Krupp Materials (125,610 square feet, 3.5% of net rentable square feet, December 31, 2013 lease expiration) and Heartland Automotive (71,400 square feet, 2.0% of net rentable square feet, June 30, 2013 lease expiration), which were underwritten as vacant with no underwritten base rent due to their intentions to vacate on their respective lease expiration dates. The physical vacancy excluding these tenants is 92.6%. |
(7) | The As-Is Appraisal Valuation Dates range from September 12, 2012 to September 20, 2012. |
The Mortgage Loan. The mortgage loan (the “STAG REIT Portfolio Mortgage Loan”) is evidenced by a single promissory note that is secured by a first mortgage encumbering 28 industrial buildings located in eight states (the “STAG REIT Portfolio Properties”). The STAG REIT Portfolio Mortgage Loan was originated on November 8, 2012 by Wells Fargo Bank, National Association. The STAG REIT Portfolio Mortgage Loan had an original principal balance of $68,815,340, has an outstanding principal balance as of the Cut-off Date of $68,815,340 and accrues interest at an interest rate of 4.310% per annum. The STAG REIT Portfolio Mortgage Loan had an initial term of 120 months, has a remaining term of 120 months as of the Cut-off Date and requires payment of interest and principal based on a 25-year amortization schedule. The STAG REIT Portfolio Mortgage Loan expires on December 1, 2012.
Following the lockout period, the borrower has the right to either (i) defease the STAG REIT Portfolio Mortgage Loan in whole, or in part, or (ii) voluntarily prepay the STAG REIT Portfolio Mortgage Loan in part (in connection with a partial release), but not in whole, provided that the borrower pays a yield maintenance premium on the principal amount being paid. In addition, the STAG REIT Portfolio Mortgage Loan is prepayable without penalty on or after September 1, 2022.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
STAG REIT PORTFOLIO |
Sources and Uses
Sources | Uses | |||||||
Original trust loan amount | $68,815,340 | 58.3% | Purchase price | $114,692,233 | 97.2% | |||
Sponsor’s new cash contribution | 49,184,578 | 41.7 | Reserves | 1,682,964 | 1.4 | |||
Closing costs | 1,624,721 | 1.4 | ||||||
Total Sources | $117,999,918 | 100.0% | Total Uses | $117,999,918 | 100.0% |
The Properties. The STAG REIT Portfolio Mortgage Loan is secured by the fee interest in 28 industrial properties totaling 3,630,021 rentable square feet and located in eight states: New York (8), Kansas (6), Indiana (4), Michigan (4), South Carolina (3), Alabama (1), Pennsylvania (1) and Virginia (1). The STAG REIT Portfolio Properties comprise 24 industrial warehouse buildings and four industrial flex buildings which range in size from 20,514 square feet to 887,084 square feet. Of the 28 properties, 24 are occupied by single tenants, and as of August 30, 2012, the STAG REIT Portfolio Properties were 98.0% occupied.
The following table presents certain information relating to the STAG REIT Portfolio Properties:
Property Name – Location | Specific Property Type | Allocated Cut-off Date Principal Balance | % of Portfolio Cut-off Date Principal Balance | Total Occupancy | Year Built/ Renovated | Net Rentable Area (SF) | Appraised Value |
100 Papercraft Park – O’Hara Township, PA | Warehouse | $18,014,821 | 26.2% | 100.0% | 1967/NAP | 887,084 | $28,100,000 |
5640 Pierson Road – Delta Township, MI | Warehouse | $6,410,969 | 9.3% | 100.0% | 2001/NAP | 250,100 | $10,000,000 |
1521 Kepner Drive – Lafayette, IN | Warehouse | $4,808,227 | 7.0% | 100.0% | 1998/1999 | 275,000 | $7,500,000 |
4757 128th Avenue – Holland, MI | Warehouse | $3,577,321 | 5.2% | 100.0% | 2002/NAP | 195,000 | $5,580,000 |
2201 East Loew Road – Marion, IN | Warehouse | $3,269,594 | 4.8% | 100.0% | 1994/NAP | 249,600 | $5,100,000 |
22925 Venture Drive – Novi, MI | Flex | $3,141,375 | 4.6% | 100.0% | 1997/NAP | 120,800 | $4,900,000 |
1540 Kepner Drive – Lafayette, IN | Warehouse | $2,340,004 | 3.4% | 100.0% | 1995/1997 | 120,000 | $3,650,000 |
2652 Eastmoor Drive – Wichita, KS | Warehouse | $1,891,236 | 2.7% | 100.0% | 1989/NAP | 120,000 | $2,950,000 |
150 Enterprise Road – Johnstown, NY | Warehouse | $1,859,181 | 2.7% | 100.0% | 1992/2001 | 57,102 | $2,900,000 |
16 Downing Drive – Phenix City, AL | Flex | $1,795,071 | 2.6% | 100.0% | 1999/NAP | 117,568 | $2,800,000 |
42600 Merrill Road – Sterling Heights, MI | Warehouse | $1,730,962 | 2.5% | 100.0% | 1989/NAP | 108,000 | $2,700,000 |
215 Mill Avenue – Greenwood, SC | Flex | $1,730,962 | 2.5% | 100.0% | 1950/1997 | 104,955 | $2,700,000 |
2655-2755 Eastmoor Drive – Wichita, KS(1) | Warehouse | $1,730,962 | 2.5% | 100.0% | 2002/NAP | 80,850 | $2,700,000 |
One Michelin Drive – Independence, VA | Warehouse | $1,609,153 | 2.3% | 100.0% | 1989/NAP | 120,000 | $2,510,000 |
308-310 Maxwell Ave – Greenwood, SC | Warehouse | $1,474,523 | 2.1% | 100.0% | 1991/NAP | 70,100 | $2,300,000 |
1520 Kepner Drive – Lafayette, IN(2) | Warehouse | $1,378,358 | 2.0% | 100.0% | 1996/NAP | 71,400 | $2,150,000 |
122 Balzano Drive – Gloversville, NY | Warehouse | $1,346,303 | 2.0% | 55.2% | 1993/NAP | 101,589 | $2,100,000 |
636 South 66th Terrace – Kansas City, KS | Warehouse | $1,314,249 | 1.9% | 100.0% | 1988/2003 | 56,580 | $2,050,000 |
141 Sal Landrio Drive – Gloversville, NY | Flex | $1,218,084 | 1.8% | 100.0% | 2000/NAP | 26,529 | $1,900,000 |
123 Union Avenue – Johnstown, NY | Warehouse | $1,218,084 | 1.8% | 100.0% | 2003/NAP | 60,000 | $1,900,000 |
1900 Wilson Avenue – Greenwood, SC | Warehouse | $1,218,084 | 1.8% | 100.0% | 1954/2001 | 120,000 | $1,900,000 |
231 Enterprise Road – Johnstown, NY | Warehouse | $993,700 | 1.4% | 100.0% | 1995/NAP | 42,235 | $1,550,000 |
109 Balzano Drive – Gloversville, NY | Warehouse | $961,645 | 1.4% | 100.0% | 1989/NAP | 59,965 | $1,500,000 |
2750 Rock Road – Wichita, KS(1) | Warehouse | $961,645 | 1.4% | 100.0% | 2001/NAP | 44,760 | $1,500,000 |
2510 Eastmoor Drive – Wichita, KS | Warehouse | $865,481 | 1.3% | 100.0% | 1999/NAP | 47,700 | $1,350,000 |
125 Balzano Road – Wichita, KS | Warehouse | $833,426 | 1.2% | 100.0% | 1993/NAP | 50,000 | $1,300,000 |
6 Clermont Street – Johnstown, NY | Warehouse | $833,426 | 1.2% | 51.0% | 1994/NAP | 52,500 | $1,300,000 |
100 Holloway Road – Ware Shoals, SC | Warehouse | $288,494 | 0.4% | 100.0% | 1989/NAP | 20,514 | $450,000 |
Total/Weighted Average | $68,815,340 | 100.0% | 98.0% | 3,630,021 | $107,340,000 |
(1) | The 2655-2755 Eastmoor Drive and 2750 Rock Road properties are currently fully occupied by Thyssen Krupp Materials but were underwritten as vacant with no underwritten base rent due to the tenant’s intention to vacate both properties at its December 31, 2013 lease expirations. |
(2) | The 1520 Kepner Drive property is currently occupied by Heartland Automotive but was underwritten as vacant with no underwritten base rent due to the tenant’s intention to vacate the property at its June 30, 2013 lease expiration. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
STAG REIT PORTFOLIO |
The following table presents certain information relating to the tenancies at the STAG REIT Portfolio Properties:
Major Tenants
Tenant Name | Credit Rating (Fitch/ Moody’s/ S&P)(1) | Tenant NRSF | % of NRSF | Annual U/W Base Rent PSF | Annual U/W Base Rent | % of Total Annual U/W Base Rent | Lease Expiration Date | ||
Major Tenants | |||||||||
American Beverage Corp | NR/NR/NR | 613,200 | 16.9% | $3.06 | $1,876,392 | 16.6% | 12/31/2014 | ||
Woodbridge Ventures(2) | NR/NR/NR | 250,100 | 6.9% | $4.38 | $1,095,012 | 9.7% | Various(2) | ||
Genco(3) | NR/NR/NR | 273,884 | 7.5% | $3.54 | $968,541 | 8.6% | Various(3) | ||
Toyota Tsusho | NR/NR/A | 239,000 | 6.6% | $4.00 | $956,000 | 8.4% | 5/31/2014 | ||
Harada Industry of America | NR/NR/NR | 120,800 | 3.3% | $4.90 | $591,920 | 5.2% | 9/30/2016 | ||
Perrigo Holland, Inc. | NR/NR/NR | 195,000 | 5.4% | $2.90 | $565,500 | 5.0% | 11/30/2017 | ||
Dunham’s Athleisure | NR/NR/NR | 249,600 | 6.9% | $2.15 | $536,640 | 4.7% | 1/31/2014 | ||
Total Major Tenants | 1,941,584 | 53.5% | $3.39 | $6,590,005 | 58.2% | ||||
Non-Major Tenants(4) | 1,617,220 | 44.6% | $2.93 | $4,732,368 | 41.8% | ||||
Occupied Collateral(4) | 3,558,804 | 98.0% | $3.18 | $11,322,373 | 100.0% | ||||
Vacant Space | 71,217 | 2.0% | |||||||
Collateral Total | 3,630,021 | 100.0% | |||||||
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | Woodbridge Ventures leases two spaces: 170,000 net rentable square feet with Annual U/W Base Rent of $765,000 ($4.50 per square foot) and a Lease Expiration Date of February 28, 2019; and 80,100 net rentable square feet with Annual U/W Base Rent of $330,012 ($4.12 per square foot) and a Lease Expiration Date of December 31, 2016. |
(3) | Genco leases two spaces: 211,150 net rentable square feet with Annual U/W Base Rent of $686,238 ($3.25 per square foot) and a Lease Expiration Date of May 31, 2013; and 62,734 net rentable square feet with Annual U/W Base Rent of $282,303 ($4.50 per square foot) and a Lease Expiration Date of May 31, 2016. Genco has the option to terminate its lease on the aforementioned 211,150 net rentable square foot space if the Pennsylvania Liquor Control Board cancels its contract with the tenant. In addition, Genco has the option to terminate up to 24,255 net rentable square feet of the aforementioned 62,734 square foot space at any time with 90 days prior notice. |
(4) | Includes Thyssen Krupp Materials (125,610 square feet, 3.5% of net rentable square feet, December 31, 2013 Lease Expiration Date) and Heartland Automotive (71,400 square feet, 2.0% of net rentable square feet, June 30, 2013 Lease Expiration Date), which were underwritten as vacant with no underwritten base rent due to their intentions to vacate on their respective Lease Expiration Dates. |
The following table presents certain information relating to the lease rollover schedule at the STAG REIT Portfolio Properties:
Lease Expiration Schedule(1)(2)
Year Ending December 31, | No. of Leases Expiring | Expiring NRSF | % of Total NRSF | Cumulative Expiring NRSF | Cumulative % of Total NRSF | Annual U/W Base Rent | Annual U/W Base Rent PSF(3) | |
MTM | 0 | 0 | 0.0% | 0 | 0.0% | $0 | $0.00 | |
2012 | 2 | 134,776 | 3.7% | 134,776 | 3.7% | $411,022 | $3.05 | |
2013(4) | 7 | 578,125 | 15.9% | 712,901 | 19.6% | $1,253,624 | $2.17 | |
2014 | 9 | 1,481,596 | 40.8% | 2,194,497 | 60.4% | $4,787,903 | $3.23 | |
2015 | 6 | 461,942 | 12.7% | 2,656,439 | 73.1% | $1,448,287 | $3.14 | |
2016 | 4 | 290,163 | 8.0% | 2,946,602 | 81.1% | $1,428,405 | $4.92 | |
2017 | 3 | 265,100 | 7.3% | 3,211,702 | 88.4% | $758,275 | $2.86 | |
2018 | 1 | 120,000 | 3.3% | 3,331,702 | 91.7% | $270,000 | $2.25 | |
2019 | 1 | 170,000 | 4.7% | 3,501,702 | 96.4% | $765,000 | $4.50 | |
2020 | 0 | 0 | 0.0% | 3,501,702 | 96.4% | $0 | $0.00 | |
2021 | 0 | 0 | 0.0% | 3,501,702 | 96.4% | $0 | $0.00 | |
2022 | 1 | 57,102 | 1.6% | 3,558,804 | 98.0% | $199,857 | $3.50 | |
Thereafter | 0 | 0 | 0.0% | 3,558,804 | 98.0% | $0 | $0.00 | |
Vacant | 0 | 71,217 | 2.0% | 3,630,021 | 100.0% | $0 | $0.00 | |
Total/Weighted Average | 34 | 3,630,021 | 100.0% | $11,322,373 | $3.18 |
(1) | Information obtained from the underwritten rent roll. |
(2) | Certain tenants may have lease termination options that are exercisable prior to the stated expiration date of the subject lease and that are not considered in the Lease Expiration Schedule. |
(3) | Weighted Average Annual U/W Base Rent PSF excludes vacant space. |
(4) | Includes Thyssen Krupp Materials (125,610 square feet, 3.5% of NRSF, December 31, 2013 lease expiration) and Heartland Automotive (71,400 square feet, 2.0% of NRSF, June 30, 2013 lease expiration), which were underwritten as vacant with no underwritten base rent due to their intentions to vacate on their respective lease expiration dates. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
STAG REIT PORTFOLIO |
The following table presents historical occupancy percentages at the STAG REIT Portfolio Properties:
Historical Occupancy Percentages(1)
12/31/2009 | 12/31/2010 | 12/31/2011 | ||
99% | 99% | 99% |
(1) | Information obtained from the borrower rent rolls. |
The Sponsor. The sponsor is STAG Industrial Operating Partnership, L.P., a subsidiary of STAG Industrial, Inc., a publicly traded REIT (“STAG”). STAG is a self-administered and self-managed full-service real estate company focused on the acquisition, ownership and management of class B, single-tenant industrial properties predominantly in secondary markets. As of November 2012, STAG’s portfolio consisted of 167 properties in 31 states with approximately 28.1 million rentable square feet.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
Rogue Valley Mall |
Loan Information | Property Information | ||||||
Mortgage Loan Seller: | Wells Fargo Bank, National Association | Single Asset/Portfolio: | Single Asset | ||||
Credit Assessment (DBRS/KBRA/Moody’s): | NR/NR/NR | Property Type: | Retail | ||||
Original Principal Balance: | $55,000,000 | Specific Property Type: | Regional Mall | ||||
Cut-off Date Principal Balance: | $55,000,000 | Location: | Medford, OR | ||||
% of Initial Pool Balance: | TBD | Size: | 453,935 SF | ||||
Loan Purpose: | Refinance | Cut-off Date Principal Balance Per Unit/SF: | $121.16 | ||||
Borrower Name: | Rogue Valley Mall L.L.C. | Year Built/Renovated: | 1986/2002 | ||||
Sponsor: | GGPLP L.L.C. | Title Vesting: | Fee | ||||
Mortgage Rate: | 4.500% | Property Manager: | Self-managed | ||||
Note Date: | September 4, 2012 | 3rd Most Recent Occupancy (As of): | 90.6% (12/31/2009) | ||||
Anticipated Repayment Date: | NAP | 2nd Most Recent Occupancy (As of): | 93.8% (12/31/2010) | ||||
Maturity Date: | October 1, 2022 | Most Recent Occupancy (As of): | 94.4% (12/31/2011) | ||||
IO Period: | 36 months | Current Occupancy (As of)(6): | 94.8% (7/31/2012) | ||||
Loan Term (Original): | 120 months | ||||||
Seasoning: | 2 months | Underwriting and Financial Information: | |||||
Amortization Term (Original): | 360 months | ||||||
Loan Amortization Type: | Interest-only, Amortizing Balloon | 3rd Most Recent NOI (As of): | $6,386,827 (12/31/2010) | ||||
Interest Accrual Method: | Actual/360 | 2nd Most Recent NOI (As of): | $6,489,274 (12/31/2011) | ||||
Call Protection: | L(26),D(87),O(7) | Most Recent NOI (As of): | $6,555,937 (TTM 6/30/2012) | ||||
Lockbox Type: | Hard/Springing Cash Management | ||||||
Additional Debt: | Yes | U/W Revenues: | $9,578,924 | ||||
Additional Debt Type: | Future Mezzanine | U/W Expenses: | $3,226,377 | ||||
U/W NOI: | $6,352,547 | ||||||
U/W NCF: | $5,891,548 | ||||||
Escrows and Reserves: | U/W NOI DSCR : | 1.90x | |||||
U/W NCF DSCR: | 1.76x | ||||||
Type: | Initial | Monthly | Cap (If Any) | U/W NOI Debt Yield: | 11.6% | ||
Taxes(1) | $0 | Springing | NAP | U/W NCF Debt Yield: | 10.7% | ||
Insurance(2) | $0 | Springing | NAP | As-Is Appraised Value: | $80,000,000 | ||
Replacement Reserve(3) | $0 | Springing | $90,792 | As-Is Appraisal Valuation Date: | August 3, 2012 | ||
TI/LC Reserve(4) | $0 | Springing | $370,212 | Cut-off Date LTV Ratio: | 68.8% | ||
Tenant Specific TI/LC(5) | $391,564 | $0 | NAP | LTV Ratio at Maturity or ARD: | 60.2% | ||
(1) | Monthly tax deposits are not required as long as no event of default has occurred and is continuing, the borrower has provided the lender with proof of full payment within a timely manner and a Trigger Event (as defined in the loan documents) has not occurred. |
(2) | Monthly insurance deposits are not required as long as no event of default has occurred and is continuing, the borrower provides evidence of an acceptable blanket insurance policy and the borrower provides the lender with proof of full payment in a timely manner. |
(3) | Monthly replacement reserves are not required as long as no Trigger Event exists and is continuing. Following the occurrence of a Trigger Event, until the occurrence of a Trigger Event Cure (as defined in the loan documents), the borrower is required to deposit monthly replacement reserves in an amount equal to $7,566 (subject to a cap of $90,792). |
(4) | Monthly TI/LC Reserves are not required as long as no Trigger Event exists and is continuing. Following the occurrence of a Trigger Event, until the occurrence of a Trigger Event Cure, the borrower is required to deposit monthly TI/LC Reserves in an amount equal to $30,851 (subject to a cap of $370,212). |
(5) | The upfront Tenant Specific TI/LC reserve is related to outstanding tenant improvement allowances for Rue 21 ($211,000), American Eagle Outfitters ($116,104), Epris ($40,000) and Just Sports ($24,460). |
(6) | Occupancy includes 39,540 square feet of temporary tenants that were not included in Annual U/W Base Rent. |
The Mortgage Loan. The mortgage loan (the “Rogue Valley Mall Mortgage Loan”) is evidenced by a single promissory note that is secured by a first mortgage encumbering a regional mall located in Medford, Oregon (the “Rogue Valley Mall Property”). The Rogue Valley Mall Mortgage Loan was originated on September 4, 2012 by Wells Fargo Bank, National Association. The Rogue Valley Mall Mortgage Loan had an original principal balance of $55,000,000, has an outstanding principal balance as of the Cut-off Date of $55,000,000 and accrues interest at an interest rate of 4.500% per annum. The Rogue Valley Mall Mortgage Loan had an initial term of 120 months, has a remaining term of 118 months as of the Cut-off Date, requires interest-only payments for the first 36 months, and thereafter requires payments of principal and interest based on a 30-year amortization schedule. The Rogue Valley Mall Mortgage Loan matures on October 1, 2022.
Following the lockout period, the borrower has the right to defease the Rogue Valley Mall Mortgage Loan in whole, but not in part, on any due date before the scheduled maturity date. In addition, the Rogue Valley Mall Mortgage Loan is prepayable without penalty on or after April 1, 2022.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
ROGUE VALLEY MALL |
Sources and Uses(1)
Sources | Uses | |||||||
Original trust loan amount | $ 55,000,000 | 100.0% | Loan payoff(2) | $25,007,526 | 45.5 | % | ||
Reserves | 391,564 | 0.7 | ||||||
Closing costs | 489,310 | 0.9 | ||||||
Return of equity | 29,111,599 | 52.9 | ||||||
Total Sources | $55,000,000 | 100.0% | Total Uses | $55,000,000 | 100.0 | % |
(1) The sponsor reports approximately $22.0 million of cash equity remaining in the Rogue Valley Mall Property.
(2) The Rogue Valley Mall Property was previously securitized in BACM 2003-1.
The Property. The Rogue Valley Mall Property is a two-story regional mall that contains approximately 640,294 square feet of which 453,935 square feet secures the Rogue Valley Mall Mortgage Loan. The Rogue Valley Mall Property is anchored by Macy’s (not part of the collateral), Kohl’s (not part of the collateral), JC Penney and Macy’s Home Store. The Rogue Valley Mall Property is situated on 36.7 acres and was built in 1986, renovated in 2002 and later expanded in 2008. Parking is provided by 2,184 surface parking spaces resulting in a parking ratio of 4.8 per every 1,000 square feet of gross leasable area. The Rogue Valley Mall Property’s mix of in-line tenants includes Champs Sports, Coldwater Creek, American Eagle, Victoria Secret, Zumiez, Gap and Aeropostale. For the trailing 12 months ending June 2012, tenants occupying less than 10,000 square feet had comparable in-line sales of $321 per square foot. Over the same time period, occupancy costs for tenants occupying less than 10,000 square feet averaged 12.2%.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
ROGUE VALLEY MALL |
The following table presents certain information relating to the tenancies at the Rogue Valley Mall Property:
Major Tenants
Tenant Name | Credit Rating (Fitch/ Moody’s/ S&P)(1) | Tenant NRSF | % of NRSF | Annual U/W Base Rent PSF | Annual U/W Base Rent | % of Total Annual U/W Base Rent | Sales PSF(2) | Occupancy Cost(2)(3) | Lease Expiration Date | |
Anchor Tenants – Not Part of Collateral | ||||||||||
Macy’s | BBB/Baa3/BBB | 104,409 | ANCHOR OWNED – NOT PART OF THE COLLATERAL | |||||||
Kohl’s | BBB+/Baa1/BBB+ | 81,950 | ANCHOR OWNED – NOT PART OF THE COLLATERAL | |||||||
Anchor Tenants – Collateral | ||||||||||
JC Penney | BB-/Ba3/B+ | 86,145 | 19.0% | $4.52 | $388,964 | 6.8% | $169 | 2.9% | 10/31/2016(4) | |
Macy’s Home Store(5) | BBB/Baa3/BBB | 84,480 | 18.6% | $4.50 | $380,160 | 6.6% | $190(6) | 5.6%(7) | 1/31/2018(8) | |
Total Anchor Tenants – Collateral | 170,625 | 37.6% | $4.51 | $769,124 | 13.5% | |||||
Major Tenants – Collateral | ||||||||||
Bed Bath & Beyond | NR/NR/BBB+ | 29,853 | 6.6% | $7.86 | $234,645 | 4.1% | NAV | NAV | 1/31/2022 | |
Zumiez | NR/NR/NR | 3,294 | 0.7% | $47.85 | $157,607 | 2.8% | $415 | 11.8% | 5/31/2016 | |
Champs Sports | NR/NR/NR | 6,193 | 1.4% | $21.22 | $131,415 | 2.3% | $246 | 7.8% | 8/31/2017 | |
Sam Goody | NR/NR/NR | 4,195 | 0.9% | $27.41 | $114,985 | 2.0% | $233 | 11.7% | 1/31/2014 | |
Christopher & Banks | NR/NR/BB | 3,410 | 0.8% | $29.87 | $101,857 | 1.8% | $191 | 14.6% | 2/28/2017 | |
Coldwater Creek | NR/NR/NR | 3,600 | 0.8% | $27.82 | $100,152 | 1.8% | $221 | 12.3% | 11/30/2015 | |
Maurices | NR/NR/NR | 5,942 | 1.3% | $16.57 | $98,459 | 1.7% | $174 | 11.3% | 7/31/2019(9) | |
American Eagle | NR/NR/NR | 4,423 | 1.0% | $21.53 | $95,214 | 1.7% | $406 | 9.4% | 1/31/2022 | |
Total Major Tenants – Collateral | 60,910 | 13.4% | $16.98 | $1,034,333 | 18.1% | |||||
Non-Major Tenants – Collateral | 198,753 | 43.8% | $19.69 | $3,913,541 | 68.5% | |||||
Occupied Collateral Total | 430,288 | 94.8% | $13.29 | $5,716,998 | 100.0% | |||||
Vacant Space | 23,647 | 5.2% | ||||||||
Collateral Total | 453,935 | 100.0% | ||||||||
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | Sales and occupancy costs are for the trailing 12-month period ending June 30, 2012. |
(3) | Occupancy costs include base rent and reimbursements, as applicable. |
(4) | JC Penney has five five-year renewal options. |
(5) | The Sports Authority subleases approximately 42,240 square feet. |
(6) | Sales PSF are based on 42,240 square feet. |
(7) | Occupancy costs are based on 84,480 square feet. |
(8) | Macy’s Home Store has five five-year renewal options. |
(9) | If sales do not exceed $750,000 in the period between June 1, 2013 and May 1, 2014, the tenant may terminate its lease. Maurices’ reported year-end 2011 sales of $1.0 million. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
ROGUE VALLEY MALL |
The following table presents certain information relating to the historical sales and occupancy costs at the Rogue Valley Mall Property:
Historical Sales (PSF) and Occupancy Costs(1)
Tenant Name | 2009 | 2010 | 2011 |
Macy’s | NAV | NAV | NAV |
Kohl’s | NAV | NAV | NAV |
JC Penney | $177 | $173 | $171 |
Macy’s Home | $90 | $90 | $75 |
Bed Bath & Beyond | NAV | NAV | NAV |
Total In-line (<10,000 square feet)(2) | $302 | $314 | $314 |
Occupancy Costs(2) | 12.6% | 12.3% | 12.1% |
(1) | Historical Sales (PSF) is based on historical statements provided by the borrower. |
(2) | Represents tenants less than 10,000 square feet who were in occupancy for 12 months in each respective year or were in occupancy the past three reporting periods. |
Lease Expiration Schedule(1)(2)
Year Ending December 31, | No. of Leases Expiring | Expiring NRSF | % of Total NRSF | Cumulative Expiring NRSF | Cumulative % of Total NRSF | Annual U/W Base Rent | Annual U/W Base Rent PSF(3) | ||
MTM(4) | 12 | 25,567 | 5.6% | 25,567 | 5.6% | $526,395 | $20.59 | ||
2012 | 2 | 3,792 | 0.8% | 29,359 | 6.5% | $105,144 | $27.73 | ||
2013(5) | 27 | 64,998 | 14.3% | 94,357 | 20.8% | $672,536 | $23.17 | ||
2014(6) | 13 | 32,480 | 7.2% | 126,837 | 27.9% | $747,181 | $23.00 | ||
2015(7) | 7 | 14,166 | 3.1% | 141,003 | 31.1% | $303,242 | $32.51 | ||
2016 | 6 | 98,841 | 21.8% | 239,844 | 52.8% | $808,982 | $8.18 | ||
2017 | 14 | 31,119 | 6.9% | 270,963 | 59.7% | $914,370 | $29.38 | ||
2018 | 6 | 99,698 | 22.0% | 370,661 | 81.7% | $640,570 | $6.43 | ||
2019 | 1 | 5,942 | 1.3% | 376,603 | 83.0% | $98,459 | $16.57 | ||
2020 | 1 | 2,893 | 0.6% | 379,496 | 83.6% | $97,060 | $33.55 | ||
2021 | 2 | 2,165 | 0.5% | 381,661 | 84.1% | $195,188 | $90.16 | ||
2022 | 6 | 48,627 | 10.7% | 430,288 | 94.8% | $607,871 | $12.50 | ||
Thereafter | 0 | 0 | 0.0% | 430,288 | 94.8% | $0 | $0.00 | ||
Vacant | 0 | 23,647 | 5.2% | 453,935 | 100.0% | $0 | $0.00 | ||
Total/Weighted Average | 97 | 453,935 | 100.0% | $5,716,998 | $13.29 |
(1) | Information was obtained from the underwritten rent roll. |
(2) | Certain tenants may have lease termination options that are exercisable prior to the stated expiration date of the subject lease and that are not considered in the Lease Expiration Schedule. |
(3) | Weighted Average Annual U/W Base Rent PSF excludes vacant space. |
(4) | Occupancy includes 5,079 square feet of temporary tenants that were not included in Annual U/W Base Rent. |
(5) | Occupancy includes 29,065 square feet of temporary tenants that were not included in Annual U/W Base Rent. |
(6) | Occupancy includes 4,838 square feet of temporary tenants that were not included in Annual U/W Base Rent. |
(7) | Occupancy includes 558 square feet of temporary tenants that were not included in Annual U/W Base Rent. |
The following table presents historical occupancy percentages at the Rogue Valley Mall Property:
Historical Occupancy Percentages(1)
12/31/2009 | 12/31/2010 | 12/31/2011 | ||
91% | 94% | 94% |
(1) | Information obtained from borrower provided historical occupancy reports. |
Market Overview and Competition. The Rogue Valley Mall Property is located in Medford, Oregon approximately 30 miles north of the California border. The Rogue Valley Mall Property is located in northern Medford, along Interstate 5, the primary north-south transportation route along the West Coast. Medford is the largest city in Southern Oregon and is the major service and trade hub for Southern Oregon. According to the appraisal, the largest employers in the Medford metro area are Asante Health System, Providence Medical Center and Harry & David, the largest mail-order gift based company in the United States. Harry & David’s headquarters are located in Medford. The nearest regional mall is located approximately 96 miles south. Within a 15-mile radius of the Rogue Valley Mall Property, defined by the appraiser as the primary trade area, there are approximately 183,359 residents and average household income is approximately $57,947 in 2012.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
ROGUE VALLEY MALL |
The following table presents certain information relating to comparable retail centers for the Rogue Valley Mall:
Competitive Set(1)
Rogue Valley Mall (Subject) | Northgate Marketplace | Bear Creek Plaza | Poplar Square | Medford Center | |
Location | Medford, OR | Medford, OR | Medford, OR | Medford, OR | Medford, OR |
Distance from Subject | -- | 0.1 miles | 0.4 miles | 0.8 miles | 0.9 miles |
Property Type | Regional Mall | Lifestyle Center | Community Center | Community Center | Regional Center |
Year Built/Renovated | 1986/2002 | 2012/NAP | 1977/2001 | 1984/1990 | 1991/1999 |
Total GLA | 640,294 SF | 80,900 SF | 197,001 SF | 211,274 SF | 419,789 SF |
Total Occupancy | 95% | 99% | 90% | 98% | 84% |
(1) | Information obtained from the appraisal dated August 3, 2012. |
The Sponsor. The sponsor for the Rogue Valley Mall Mortgage Loan is General Growth Properties, Inc. (“GGP”). GGP is a publicly traded REIT that has ownership interests in 145 malls totaling approximately 136 million square feet. GGP entered Chapter 11 bankruptcy proceedings in April 2009 and emerged from bankruptcy protection in November 2010.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
Animas Valley Mall | |||||||
Loan Information | Property Information | ||||||
Mortgage Loan Seller: | The Royal Bank of Scotland | Single Asset/Portfolio: | Single Asset | ||||
Credit Assessment (DBRS/KBRA/Moody’s): | NR/NR/NR | Property Type: | Retail | ||||
Original Principal Balance: | $51,800,000 | Specific Property Type: | Regional Mall | ||||
Cut-off Date Principal Balance: | $51,731,787 | Location: | Farmington, NM | ||||
% of Initial Pool Balance: | TBD | Size(3): | 476,923 SF | ||||
Loan Purpose: | Refinance | Cut-off Date Principal | $108.47 | ||||
Balance Per Unit/SF: | |||||||
Borrower Name: | Animas Valley Mall, LLC | Year Built/Renovated: | 1982/2006 | ||||
Sponsor: | Rouse Properties, Inc. | Title Vesting: | Fee | ||||
Mortgage Rate: | 4.500% | Property Manager: | Rouse Properties, Inc. | ||||
Note Date: | October 25, 2012 | 3rd Most Recent Occupancy (As of): | 96.6% (12/31/2009) | ||||
Anticipated Repayment Date: | NAP | 2nd Most Recent Occupancy (As of): | 95.1% (12/31/2010) | ||||
Maturity Date: | November 1, 2022 | Most Recent Occupancy (As of): | 93.5% (12/31/2011) | ||||
IO Period: | None | Current Occupancy (As of)(4): | 89.4% (9/30/2012) | ||||
Loan Term (Original): | 120 months | ||||||
Seasoning: | 1 month | Underwriting and Financial Information: | |||||
Amortization Term (Original): | 360 months | ||||||
Loan Amortization Type: | Amortizing Balloon | 3rd Most Recent NOI (As of): | $4,941,286 (12/31/2010) | ||||
Interest Accrual Method: | Actual/360 | 2nd Most Recent NOI (As of): | $4,998,173 (12/31/2011) | ||||
Call Protection: | L(25),D(90),O(5) | Most Recent NOI (As of): | $5,000,319 (TTM 9/30/2012) | ||||
Lockbox Type: | Hard/Springing Cash Management | ||||||
Additional Debt: | None | U/W Revenues: | $8,072,107 | ||||
Additional Debt Type: | NAP | U/W Expenses: | $2,699,156 | ||||
U/W NOI: | $5,372,951 | ||||||
U/W NCF: | $4,929,413 | ||||||
Escrows and Reserves: | U/W NOI DSCR: | 1.71x | |||||
U/W NCF DSCR: | 1.57x | ||||||
Type: | Initial | Monthly | Cap (If Any) | U/W NOI Debt Yield: | 10.4% | ||
Taxes | $125,986 | $17,998 | NAP | U/W NCF Debt Yield: | 9.5% | ||
Insurance(1) | $0 | Springing | NAP | As-Is Appraised Value: | $74,000,000 | ||
Replacement Reserve | $0 | $18,344 | $220,128 | As-Is Appraisal Valuation Date: | September 26, 2012 | ||
TI/LC Reserve | $0 | $22,543 | $270,511 | Cut-off Date LTV Ratio: | 69.9% | ||
Outstanding TI/LC Reserve(2) | $360,908 | $0 | NAP | LTV Ratio at Maturity or ARD: | 56.6% | ||
(1) | Monthly insurance escrows are not required so long as the insurance required to be maintained by the borrower is effected under an acceptable blanket insurance policy. |
(2) | The Outstanding TI/LC Reserve represents outstanding tenant improvement and leasing commissions funds attributable to four tenants: Inizio ($119,958), Boot Barn ($20,000), Lids ($40,000) and The Children’s Place ($180,950) and leasing commissions funds attributable to four tenants: Inizio ($119,958), Boot Barn ($20,000), Lids ($40,000) and The Children’s Place ($180,950). |
(3) | The Animas Valley Mall property contains 476,923 square feet of net rentable area as well as 14,916 square feet of unleasable raw space which is not included in the underwriting of the Animas Valley Mall property. The total gross rentable square footage of the Animas Valley property is 491,839. |
(4) | Current Occupancy excludes temporary and seasonal tenants. For the rent roll dated September 30, 2012, the occupancy inclusive of these tenants was 93.3%. Historical Occupancies are inclusive of temporary and seasonal tenants. |
The Mortgage Loan. The mortgage loan (the “Animas Valley Mall Mortgage Loan”) is evidenced by a single promissory note that is secured by a first mortgage encumbering a regional mall located in Farmington, New Mexico (the “Animas Valley Mall Property”). The Animas Valley Mall Mortgage Loan was originated on October 25, 2012 by The Royal Bank of Scotland. The Animas Valley Mall Mortgage Loan had an original principal balance of $51,800,000, has an outstanding principal balance as of the Cut-off Date of $51,731,787 and accrues interest at an interest rate of 4.500% per annum. The Animas Valley Mall Mortgage Loan had an initial term of 120 months, has a remaining term of 119 months as of the Cut-off Date and requires payments of principal and interest based on a 30-year amortization schedule. The Animas Valley Mall Mortgage Loan will mature on November 1, 2022.
Following the lockout period, the borrower will have the right to defease the Animas Valley Mall Mortgage Loan in whole, but not in part, on any due date before the scheduled maturity date. In addition, the Animas Valley Mall Mortgage Loan is expected to be prepayable without penalty on or after July 1, 2022.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
ANIMAS VALLEY MALL
Sources and Uses | ||||||||
Sources | Uses | |||||||
Original trust loan amount | $51,800,000 | 100.0% | Loan Payoff(1) | $37,128,000 | 71.7% | |||
Reserves | 486,894 | 0.9 | ||||||
Closing costs | 429,818 | 0.8 | ||||||
Return of equity | 13,755,288 | 26.6 | ||||||
Total Sources | $51,800,000 | 100.0% | Total Uses | $51,800,000 | 100.0% |
(1) | The Animas Valley Mall Property was previously securitized in LBUBS 2003-C8. |
The Property. The Animas Valley Mall Property is comprised of a 476,923 square foot regional mall located at the intersection of East Main Street and English Road in Farmington, New Mexico. The Animas Valley Mall Property is anchored by Dillard’s, Sears and JC Penney. Tenancy at the property also includes the Animas 10 movie theatre, Ross Dress for Less and Boot Barn as well as over 55 in-line retailers including national tenants such as: Rue 21, Coach House Gifts, Famous Footwear, Aeropostale, Applebee’s, Bath & Body Works and Journeys among others.
The Animas Valley Mall Property was developed in 1982, was acquired by General Growth Properties, Inc. in 2002, and was renovated in 2001, 2003 and 2006. In 2003, the Animas Valley Mall Property underwent a redevelopment and expansion which included a reconfigured 400-seat food court, and in 2006, the movie theatre was relocated and expanded. In addition to the primary mall building, the Animas Valley Mall Property also contains three outparcel buildings occupied by Boot Barn, Applebee’s and Taco Bell.
For the Animas Valley Mall Property, over the trailing 12-month period ending September 30, 2012, tenants occupying less than 10,000 square feet had comparable in-line average sales of $329 per square foot. Over the same time period, comparable occupancy costs for tenants occupying less than 10,000 square feet averaged 11.5%.
The following table presents certain information relating to the tenancies at the Animas Valley Mall Property:
Major Tenants
Tenant Name | Credit Rating (Fitch/ Moody’s/ S&P)(1) | Tenant NRSF | % of NRSF | Annual U/W Base Rent PSF | Annual U/W Base Rent(2) | % of Total Annual U/W Base Rent | Sales PSF(3) | Occupancy Cost(3)(4) | Lease Expiration Date | ||
Anchor Tenants | |||||||||||
Dillard’s | BB+/Ba3/BB | 72,212 | 15.1% | $4.00 | $288,848 | 6.2% | $151 | 3.3% | 1/30/2016 | ||
JC Penney | BB+/Ba3/B+ | 50,749 | 10.6% | $3.26 | $165,438 | 3.5% | $203 | 2.1% | 4/30/2018 | ||
Sears | B/B2/CCC+ | 65,856 | 13.8% | $2.42 | $159,590 | 3.4% | $159 | 2.7% | 8/31/2032 | ||
Total Anchor Tenants | 188,817 | 39.6% | $3.25 | $613,876 | 13.2% | ||||||
Other Major Tenants | |||||||||||
Animas 10 | NR/NR/NR | 30,648 | 6.4% | $10.50 | $321,804 | 6.9% | (5) | 8.2% | 10/31/2027 | ||
Boot Barn | NR/NR/NR | 15,000 | 3.1% | $15.00 | $225,000 | 4.8% | $205 | 5.5% | 9/30/2017 | ||
Ross Dress for Less | NR/NR/BBB+ | 30,000 | 6.3% | $6.00 | $180,000 | 3.9% | $193 | 5.1% | 1/31/2017 | ||
Total Anchor Tenants | 75,648 | 15.9% | $9.61 | $726,804 | 15.6% | ||||||
Non-Major Tenants | 161,951 | 34.0% | $20.53 | $3,324,783 | 71.3% | ||||||
Occupied Collateral(6) | 426,416 | 89.4% | $10.94 | $4,665,463 | 100.0% | ||||||
Vacant Space | 50,507 | 10.6% | |||||||||
Collateral Total(7) | 476,923 | 100.0% | |||||||||
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | Annual U/W Base Rent includes contractual rent steps through April of 2013. |
(3) | Sales and occupancy costs are for the trailing 12-month period ending September 30, 2012. |
(4) | Occupancy costs include base rent, reimbursements and percentage rent as applicable. |
(5) | Animas 10 had sales per screen of $450,631 for the trailing 12-month period ended September 30, 2012. |
(6) | Occupancy excludes temporary and seasonal tenants. For the rent roll dated September 30, 2012, the occupancy inclusive of these tenants was 93.3%. |
(7) | The Animas Valley Mall Property contains 476,923 square feet of net rentable area as well as 14,916 square feet of unleasable raw space which was not included in the underwriting of the Animas Valley Mall Property. The total gross rentable square footage of the Animas Valley Mall Property is 491,839. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
ANIMAS VALLEY MALL |
The following table presents certain information relating to the historical sales and occupancy costs at the Animas Valley Mall Property:
Historical Sales (PSF) and Occupancy Costs(1)
Tenant Name | 2009 | 2010 | 2011 | TTM |
Dillard’s | $147 | $143 | $145 | $151 |
Sears | $169 | $162 | $167 | $159 |
JC Penney | $207 | $195 | $209 | $203 |
Animas 10 | (2) | (2) | (2) | (2) |
Ross Dress for Less | $186 | $178 | $186 | $193 |
Boot Barn | $160 | $171 | $206 | $205 |
Total In-line (<10,000 square feet)(3) | $288 | $301 | $309 | $329 |
Occupancy Costs(3) | 11.4% | 11.8% | 11.9% | 11.5% |
(1) | Historical Sales (PSF) is based on historical statements provided by the borrower. |
(2) | Sales per screen for Animas 10 (10 screens) were $451,493, $466,615, 442,386 and $450,631 for 2009, 2010, 2011 and the trailing 12-month period ending September 30, 2012, respectively. |
(3) | Represents tenants less than 10,000 square feet who were in occupancy for 12 months in each respective year or were in occupancy the past three reporting periods. |
The following table presents certain information relating to the lease rollover schedule at the Animas Valley Mall Property:
Lease Expiration Schedule(1)(2)
Year Ending December 31, | No. of Leases Expiring | Expiring NRSF | % of Total NRSF | Cumulative Expiring NRSF | Cumulative % of Total NRSF | Annual U/W Base Rent | Annual U/W Base Rent PSF(3) |
MTM | 0 | 0 | 0.0% | 0 | 0.0% | $0 | $0.00 |
2012 | 1 | 863 | 0.2% | 863 | 0.2% | $22,438 | $26.00 |
2013 | 5 | 14,078 | 3.0% | 14,941 | 3.1% | $168,796 | $11.99 |
2014 | 12 | 19,943 | 4.2% | 34,884 | 7.3% | $488,993 | $24.52 |
2015 | 8 | 27,855 | 5.8% | 62,739 | 13.2% | $601,838 | $21.61 |
2016 | 6 | 84,885 | 17.8% | 147,624 | 31.0% | $664,464 | $7.83 |
2017 | 12 | 72,805 | 15.3% | 220,429 | 46.2% | $943,920 | $12.97 |
2018 | 5 | 77,633 | 16.3% | 298,062 | 62.5% | $502,644 | $6.47 |
2019 | 2 | 5,635 | 1.2% | 303,697 | 63.7% | $139,690 | $24.79 |
2020 | 0 | 0 | 0.0% | 303,697 | 63.7% | $0 | $0.00 |
2021 | 2 | 5,966 | 1.3% | 309,663 | 64.9% | $179,177 | $30.03 |
2022 | 4 | 14,377 | 3.0% | 324,040 | 67.9% | $312,523 | $21.74 |
Thereafter | 4 | 102,376 | 21.5% | 426,416 | 89.4% | $640,980 | $6.26 |
Vacant(4) | 0 | 50,507 | 10.6% | 476,923 | 100.0% | $0 | $0.00 |
Total/Weighted Average | 61 | 476,923 | 100.0% | $4,665,463 | $10.94 |
(1) | Information obtained from the underwritten rent roll. |
(2) | Certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date of the subject lease and that are not shown in the Lease Expiration Schedule. |
(3) | Weighted Average Annual U/W Base Rent PSF excludes vacant space. |
(4) | 18,517 square feet (3.9% of net rentable area) is leased to temporary or seasonal tenants and is classified as vacant. Occupancy inclusive of these tenants is 93.3% as of September 30, 2012. |
The following table presents historical occupancy percentages at the Animas Valley Mall Property:
Historical Occupancy Percentages(1)(2)
12/31/2009 | 12/31/2010 | 12/31/2011 | ||
97% | 95% | 94% |
(1) | Information was obtained from the borrower and is based on a total net rentable square footage of 476,923, excluding 14,916 square feet of undeveloped in-line space. This undeveloped space was included as vacant square footage in the underwriting. |
(2) | Includes temporary or seasonal tenants. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
ANIMAS VALLEY MALL |
Market Overview and Competition. The Animas Valley Mall Property is located in Farmington, New Mexico, approximately 50 miles southwest of Durango, Colorado and 160 miles northwest of Albuquerque, New Mexico. Located in Northwest New Mexico, the city of Farmington, according to the San Juan County Economic Development (SJEDS), is the largest city in the “Four Corners” area (intersection of New Mexico, Colorado, Arizona and Utah), with a population of 43,573, and serves as a trade center for the larger Four Corners region, which has a population base of more than 250,000. The appraiser defined the Animas Valley Mall Property’s primary and secondary trade areas as 15 and 30 miles, respectively. According to the appraisal, the 2012 population within 15 and 30 miles of the property was 103,375 and 119,694, respectively, while the 2012 median household income for the same radii was $46,045 and $45,860, respectively. The Animas Valley Mall Property is situated along the south side of East Main Street (Highway 516), less than five miles northeast of the intersection of Highway 64. East Main Street is a heavily traveled thoroughfare that serves most of the Four Corner areas to the west with average daily traffic counts of 38,700 vehicles per day.
The Animas Valley Mall Property is the only enclosed regional mall serving the Farmington MSA and the closest enclosed regional mall, Cottonwood Mall, is located in Albuquerque, New Mexico, approximately 160 miles southwest of the Animas Valley Mall Property. The appraiser noted several shopping centers in the immediate area of the Animas Valley Mall Property, which were considered to be the most direct competition, due to the lack of regional mall competition. Competitive properties, as determined by the appraiser, are described in more detail in the chart below.
The appraiser estimated the weighted average triple net market rental rate for inline tenants less than 10,000 square feet to be $21.68 per square foot for the Animas Valley Mall Property. Additionally, the appraiser assumed a vacancy rate of 10.4% for the Animas Valley Mall Property.
The following table presents certain information relating to some comparable retail centers provided in the appraisal for the Animas Valley Mall Property:
Retail Competitive Set(1)
Animas Valley Mall (Subject) | San Juan Centers | Orchard Plaza | Plaza Farmington | Four Corner’s Marketplace | |
Location | Farmington, NM | Farmington, NM | Farmington, NM | Farmington, NM | Farmington, NM |
Distance from Subject | -- | 1.0 mile | 4.0 miles | 3.0 miles | 3.0 miles |
Property Type | Regional Mall | Anchored | Anchored | Anchored | Anchored |
Year Built/Renovated | 1982/2006 | 1976/2007 | 1970/NAV | 2003/NAV | 1998/NAV |
Anchors | Dillards, Sears, JC Penney | Beall’s, Dollar General, Hobby Lobby, Staples | Big Lots, Jo-Ann Fabrics | Best Buy, Home Depot, Petco, Safeway, TJ Maxx | Albertson’s, OfficeMax |
Total GLA | 476,923 SF | 276,000 SF | 98,920 SF | 282,778 SF | 97,386 SF |
Total Occupancy | 89% | 80% | 90% | 95% | 90% |
(1) | Information obtained from the appraisal dated October 4, 2012. |
The Sponsor. The sponsor for the Animas Valley Mortgage Loan is Rouse Properties, Inc. (“Rouse”). Rouse is a publicly traded real estate investment trust headquartered in New York City and is publicly traded on the New York Stock Exchange under the ticker RSE. As of December 31, 2011, Rouse reported an ownership interest in 30 retail properties comprising over 21 million square feet of retail and ancillary space. Rouse reported total assets of approximately $1.6 billion and total shareholder’s equity of approximately $426.3 million as of December 31, 2011.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
Laurel Lakes Shopping Center |
Loan Information | Property Information | ||||||
Mortgage Loan Seller: | Wells Fargo Bank, National Association | Single Asset/Portfolio: | Single Asset | ||||
Credit Assessment (DBRS/KBRA/Moody’s): | NR/NR/NR | Property Type: | Retail | ||||
Original Principal Balance: | $47,000,000 | Specific Property Type: | Anchored | ||||
Cut-off Date Principal Balance: | $47,000,000 | Location: | Laurel, MD | ||||
% of Initial Pool Balance: | TBD | Size: | 402,474 SF | ||||
Loan Purpose: | Refinance | Cut-off Date Principal Balance Per Unit/SF: | $116.78 | ||||
Borrower Name: | Laurel Lakes, LLC | Year Built/Renovated: | 1985/2004 | ||||
Sponsor: | Richard E. Rotner; John J. Greytak | Title Vesting: | Fee | ||||
Mortgage Rate: | 4.150% | Property Manager: | Maryland Financial Investors, Inc. | ||||
Note Date: | October 26, 2012 | 3rd Most Recent Occupancy (As of): | 98.8% (12/31/2009) | ||||
Anticipated Repayment Date: | NAP | 2nd Most Recent Occupancy (As of): | 98.8% (12/31/2010) | ||||
Maturity Date: | November 1, 2022 | Most Recent Occupancy (As of): | 98.8% (12/31/2011) | ||||
IO Period: | 120 months | Current Occupancy (As of): | 98.8% (9/28/2012) | ||||
Loan Term (Original): | 120 months | ||||||
Seasoning: | 1 month | Underwriting and Financial Information: | |||||
Amortization Term (Original): | 360 months | ||||||
Loan Amortization Type: | Interest-only, Balloon | 3rd Most Recent NOI (As of): | $5,331,882 (12/31/2010) | ||||
Interest Accrual Method: | Actual/360 | 2nd Most Recent NOI (As of): | $5,778,788 (12/31/2011) | ||||
Call Protection: | L(25),D(91),O(4) | Most Recent NOI (As of): | $6,031,581 (TTM 7/31/2012) | ||||
Lockbox Type: | Soft/Springing Cash Management | ||||||
Additional Debt: | None | U/W Revenues: | $7,616,050 | ||||
Additional Debt Type: | NAP | U/W Expenses: | $2,070,826 | ||||
U/W NOI: | $5,545,224 | ||||||
U/W NCF: | $5,263,492 | ||||||
U/W NOI DSCR: | 2.80x | ||||||
Escrows and Reserves: | U/W NCF DSCR: | 2.66x | |||||
U/W NOI Debt Yield: | 11.8% | ||||||
Type: | Initial | Monthly | Cap (If Any) | U/W NCF Debt Yield: | 11.2% | ||
Taxes | $303,888 | $101,297 | NAP | As-Is Appraised Value: | $90,200,000 | ||
Insurance(1) | $0 | Springing | NAP | As-Is Appraisal Valuation Date: | May 24, 2012 | ||
Replacement Reserves(2) | $0 | Springing | NAP | Cut-off Date LTV Ratio: | 52.1% | ||
TI/LC Reserve(3) | $0 | Springing | Various | LTV Ratio at Maturity or ARD: | 52.1% | ||
(1) | Monthly insurance escrows are not required as long as no event of default has occurred and is continuing and the borrower provides satisfactory evidence that the Laurel Lakes Shopping Center property is insured in accordance with the loan documents. |
(2) | Monthly replacement reserves are not required as long as the Laurel lakes Shopping Center property is being adequately maintained, as reasonably determined by the lender. |
(3) | The borrower is required to deposit ongoing monthly TI/LC Reserves if certain events occur and are continuing, including: (i) the borrower terminates the Modell’s lease and enters into a new lease with DSW Shoes (or a similar tenant acceptable to the lender) on or before December 31, 2013 with terms materially similar to those outlined in the signed letter of intent dated September 26, 2012; (ii) the borrower modifies Best Buy’s lease to decrease the amount of leased space, provided that the space returned by Best Buy is leased to Old Navy (or a similar tenant acceptable to the lender) on the same or better terms than the current lease with Best Buy and with a lease maturity on or later than the Best Buy lease; (iii) Safeway (a) fails to deliver a renewal notice by May 31, 2015, (b) defaults on its lease, (c) terminates its lease, (d) goes dark for a period of 10 days or more, or (e) provides notice that it will not renew its lease; or (iv) Safeway or its parent company files for bankruptcy or has an involuntary bankruptcy proceeding filed against them. With respect to (i) or (ii), the reserve account is subject to a cap in an amount equal to the total amount of TI/LCs and free rent set forth in the applicable lease. With respect to (iii) or (iv), the TI/LC Reserve is subject to a cap of $1,000,000; provided, however, if the trigger event is caused by Safeway failing to deliver a renewal notice by May 31, 2015 and Safeway thereafter executes a new lease, then the cap will be the total amount of TI/LCs and free rent set forth in such lease. |
The Mortgage Loan. The mortgage loan (the “Laurel Lakes Shopping Center Mortgage Loan”) is evidenced by a single promissory note that is secured by a first mortgage encumbering an anchored retail center located in Laurel, Maryland (the “Laurel Lakes Shopping Center Property”). The Laurel Lakes Shopping Center Mortgage Loan was originated on October 26, 2012 by Wells Fargo Bank, National Association. The Laurel Lakes Shopping Center Mortgage Loan had an original principal balance of $47,000,000, has an outstanding principal balance as of the Cut-off Date of $47,000,000 and accrues interest at an interest rate of 4.150% per annum. The Laurel Lakes Shopping Center Mortgage Loan had an initial term of 120 months, has a remaining term of 119 months as of the Cut-off Date and requires interest-only payments. The Laurel Lakes Shopping Center Mortgage Loan matures on November 1, 2022.
Following the lockout period, the borrower has the right to defease the Laurel Lakes Shopping Center Mortgage Loan in whole, but not in part, on any due date before the scheduled maturity date. In addition, the Laurel Lakes Shopping Center Mortgage Loan is prepayable without penalty on or after August 1, 2022.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
LAUREL LAKES SHOPPING CENTER |
Sources and Uses
Sources | Uses | ||||||||
Original trust loan amount | $47,000,000 | 100.0% | Loan Payoff(1) | $45,245,950 | 96.3 | % | |||
Reserves | 303,888 | 0.6 | |||||||
Closing costs | 579,325 | 1.2 | |||||||
Return of equity | 870,837 | 1.9 | |||||||
Total Sources | $47,000,000 | 100.0% | Total Uses | $47,000,000 | 100.0 | % |
(1) The Laurel Lakes Shopping Center Property was previously securitized in GSMS 2004-GG2.
The Property. The Laurel Lakes Shopping Center Property is an anchored retail center containing approximately 402,474 net rentable square feet and located in Laurel, Prince George’s County, Maryland. The Laurel Lakes Shopping Center Property was built in 1985, and renovated in 2004 and is situated on a 38.9-acre site. The property comprises three buildings (excluding pad sites) with anchor tenants including Lowes Home Center, Best Buy, Safeway, Ross Dress for Less and Staples. Parking is provided by a total of 2,500 spaces, which results in a parking ratio of 6.21 spaces per 1,000 square feet of rentable area. As of September 28, 2012, the Laurel Lakes Shopping Center Property was 98.8% occupied by 26 tenants.
The following table presents certain information relating to the tenancies at the Laurel Lakes Shopping Center Property:
Major Tenants
Tenant Name | Credit Rating (Fitch/ Moody’s/ S&P)(1) | Tenant NRSF | % of NRSF | Annual U/W Base Rent PSF | Annual U/W Base Rent | % of Total Annual U/W Base Rent | Sales PSF(2) | Occupancy Cost(2)(3) | Lease Expiration Date | ||
Major Tenants | |||||||||||
Lowes Home Center(4) | NR/A3/A- | 135,1397 | 33.6% | $10.19 | $1,378,000 | 22.6% | NAV | NAV | 8/26/2021 | ||
Best Buy | BB+/Baa2/BB+ | 51,325 | 12.8% | $12.50 | $641,562 | 10.5% | NAV | NAV | 1/31/2020 | ||
Safeway | BBB-/Baa3/BBB | 48,911 | 12.2% | $9.75 | $476,887 | 7.8% | $321 | 4.5% | 3/31/2016 | ||
Ross Dress for Less | NR/NR/BBB+ | 30,187 | 7.5% | $15.00 | $452,805 | 7.4% | NAV | NAV | 1/31/2015 | ||
Staples | BBB/Baa2/BBB | 19,775 | 4.9% | $14.95 | $295,636 | 4.9% | NAV | NAV | 10/31/2019 | ||
Michael’s | NR/B3/B | 22,786 | 5.7% | $12.50 | $284,825 | 4.7% | NAV | NAV | 2/28/2014 | ||
Modell’s | NR/NR/NR | 22,880 | 5.7% | $12.10 | $276,848 | 4.5% | $87 | 19.2% | 10/31/2019 | ||
Total – Major Tenants | 331,061 | 82.3% | $11.50 | $3,806,564 | 62.5% | ||||||
Non-Major Tenants | 66,424 | 16.5% | $34.36 | $2,282,327 | 37.5% | ||||||
Occupied Collateral | 397,485 | 98.8% | $15.32 | $6,088,891 | 100.0% | ||||||
Vacant Space | 4,989 | 1.2% | |||||||||
Collateral Total | 402,474 | 100.0% | |||||||||
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | Sales per square foot and occupancy costs are for the trailing 12-month period ending December 31, 2011. |
(3) | Occupancy costs include base rent and reimbursements, as applicable. |
(4) | Lowes Home Center is a leased fee tenant and owns its building. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
LAUREL LAKES SHOPPING CENTER |
The following table presents certain information relating to the lease rollover schedule at the Laurel Lakes Shopping Center Property:
Lease Expiration Schedule(1)(2)
Year Ending December 31, | No. of Leases Expiring | Expiring NRSF | % of Total NRSF | Cumulative Expiring NRSF | Cumulative % of Total NRSF | Annual U/W Base Rent | Annual U/W Base Rent PSF(3) | |
MTM | 0 | 0 | 0.0% | 0 | 0.0% | $0 | $0.00 | |
2012 | 0 | 0 | 0.0% | 0 | 0.0% | $0 | $0.00 | |
2013 | 2 | 4,000 | 1.0% | 4,000 | 1.0% | $155,561 | $38.89 | |
2014 | 2 | 26,228 | 6.5% | 30,228 | 7.5% | $397,171 | $15.14 | |
2015 | 7 | 47,926 | 11.9% | 78,154 | 19.4% | $957,597 | $19.98 | |
2016 | 3 | 57,034 | 14.2% | 135,188 | 33.6% | $683,987 | $11.99 | |
2017 | 2 | 7,833 | 1.9% | 143,021 | 35.5% | $311,480 | $39.77 | |
2018 | 1 | 2,511 | 0.6% | 145,532 | 36.2% | $112,995 | $45.00 | |
2019 | 3 | 46,643 | 11.6% | 192,175 | 47.7% | $664,208 | $14.24 | |
2020 | 1 | 51,325 | 12.8% | 243,500 | 60.5% | $641,562 | $12.50 | |
2021 | 3 | 148,911 | 37.0% | 392,411 | 97.5% | $1,858,835 | $12.48 | |
2022 | 0 | 0 | 0.0% | 392,411 | 97.5% | $0 | $0.00 | |
Thereafter | 2 | 5,074 | 1.3% | 397,485 | 98.8% | $305,494 | $60.21 | |
Vacant | 0 | 4,989 | 1.2% | 402,474 | 100.0% | $0 | $0.00 | |
Total/Weighted Average | 26 | 402,474 | 100.0% | $6,088,891 | $15.32 |
(1) | Information obtained from the underwritten rent roll. |
(2) | Certain tenants may have lease termination options that are exercisable prior to the stated expiration date of the subject lease and that are not considered in the Lease Expiration Schedule. |
(3) | Weighted Average Annual U/W Base Rent PSF excludes vacant space. |
The following table presents historical occupancy percentages at the Laurel Lakes Shopping Center Property:
Historical Occupancy Percentages(1)
12/31/2009 | 12/31/2010 | 12/31/2011 | ||
99% | 99% | 99% |
(1) | Information obtained from the borrower rent rolls. |
Market Overview and Competition. The Laurel Lakes Shopping Center Property is located within the City of Laurel, Prince George’s County, Maryland, approximately 23 miles southwest of the Baltimore central business district and approximately 24 miles northeast of Washington, D.C. The boundaries of the immediate area are Interstate 95 to the west, Baltimore Washington Parkway (Maryland Route 295) to the east, Maryland Route 32 to the north and Beltsville, Maryland to the south. Due to its proximity to the nation’s capital, the immediate area is home to several federal agencies such as NASA Goddard Space Flight Center, USDA Beltsville Agricultural Research Center, Institute of Defense Analysis, U.S. Census Bureau Supercomputer Center and Army Research Laboratory. In addition, the 5,400-acre Fort Meade Military Base, which is also home to the National Security Agency, is located approximately five miles east of the Laurel Lakes Shopping Center Property. According to the appraisal, the population within a three-mile and five-mile radius of the Laurel Lakes Shopping Center Property is 74,190 and 151,228, respectively. The estimated average household income within the same three-mile and five-mile radii is $77,391 and $87,123, respectively.
According to the appraisal, the Laurel Lakes Shopping Center Property is located in the Northern Prince George’s County submarket, which contains approximately 7.7 million square feet of retail space. The submarket vacancy is approximately 10.0% as of the second quarter of 2012 with average asking rents of $21.32 per square foot on a triple net basis.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
LAUREL LAKES SHOPPING CENTER |
The following table presents certain information relating to comparable retail centers for the Laurel Lakes Shopping Center Property:
Competitive Set(1)
Laurel Lakes Shopping Center (Subject) | Centre at Laurel | Laurel Shopping Center | Maryland City Plaza | Corridor Marketplace | Laurel Commons | |
Location | Laurel, MD | Laurel, MD | Laurel, MD | Laurel, MD | Laurel, MD | Laurel, MD |
Distance from Subject | -- | 0.5 miles | 1.2 miles | 3.2 miles | 3.7 miles | 1.0 mile |
Property Type | Community Center | Community Center | Community Center | Community Center | Community Center | Regional Center |
Year Built/Renovated | 1985/2004 | 2005/NAP | 1956/1994 | 1965/2005 | 1995/NAP | 1969/1999 |
Total GLA | 402,474 SF | 136,961 SF | 386,000 SF | 192,893 SF | 438,428 SF | 664,589 SF |
Total Occupancy | 99% | 96% | 94% | 95% | 100% | NAV |
(1) | Information obtained from the appraisal dated September 13, 2012. |
The Sponsor. The loan sponsors are Richard E. Rotner and John J. Greytak. Richard E. Rotner is the chairman of H&R Retail, Inc., one of the largest retail-only real estate brokerage firms in the Washington, D.C./Baltimore metropolitan area. In addition to tenant representation, Mr. Rotner has been responsible for the syndication, development, leasing and management of shopping centers for over 20 limited partnerships and has personally developed more than two million square feet of retail space in the greater Washington, D.C./Baltimore area. John J. Greytak currently holds ownership interests in nine retail developments valued at approximately $99.0 million and reported a net worth of approximately $94.2 million as of March 1, 2012. Richard E. Rotner and John J. Greytak were involved in loan defaults and debt restructurings related to prior owned properties.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
Bricktown Square Shopping Center |
Loan Information | Property Information | |||||||
Mortgage Loan Seller: | The Royal Bank of Scotland | Single Asset/Portfolio: | Single Asset | |||||
Credit Assessment (DBRS/KBRA/Moody’s): | NR/NR/NR | Property Type: | Retail | |||||
Original Principal Balance: | $35,500,000 | Specific Property Type: | Anchored | |||||
Cut-off Date Principal Balance: | $35,500,000 | Location: | Chicago, IL | |||||
% of Initial Pool Balance: | TBD | Size: | 292,309 SF | |||||
Loan Purpose: | Refinance | Cut-off Date Principal Balance Per Unit/SF: | $127.78 | |||||
Borrower Name: | Bricktown Square, LLC | Year Built/Renovated: | 1987/2008 | |||||
Sponsor: | David Lasky; Scott Inbinder; Robert Palley | Title Vesting: | Fee | |||||
Mortgage Rate: | 4.590% | Property Manager: | Bonnie Management Corporation | |||||
Note Date: | November 6, 2012 | 3rd Most Recent Occupancy (As of): | 86.7% (12/31/2009) | |||||
Anticipated Repayment Date: | NAP | 2nd Most Recent Occupancy (As of): | 90.1% (12/31/2010) | |||||
Maturity Date: | December 1, 2022 | Most Recent Occupancy (As of): | 90.1% (12/31/2011) | |||||
IO Period: | None | Current Occupancy (As of): | 94.2% (9/1/2012) | |||||
Loan Term (Original): | 120 months | |||||||
Seasoning: | 0 months | Underwriting and Financial Information: | ||||||
Amortization Term (Original): | 360 months | |||||||
Loan Amortization Type: | Amortizing Balloon | 3rd Most Recent NOI (As of): | $3,499,018 (12/31/2010) | |||||
Interest Accrual Method: | Actual/360 | 2nd Most Recent NOI (As of): | $3,221,549 (12/31/2011) | |||||
Call Protection: | L(24),D(92),O(4) | Most Recent NOI (As of): | $3,373,361 (TTM 8/31/2012) | |||||
Lockbox Type: | Hard/Springing Cash Management | |||||||
Additional Debt: | None | U/W Revenues: | $5,147,898 | |||||
Additional Debt Type: | NAP | U/W Expenses: | $1,847,026 | |||||
U/W NOI: | $3,300,872 | |||||||
Escrows and Reserves | U/W NCF: | $2,988,497 | ||||||
U/W NOI DSCR : | 1.51x | |||||||
Type: | Initial | Monthly | Cap (If Any) | U/W NCF DSCR: | 1.37x | |||
Taxes | $455,861 | $91,172 | NAP | U/W NOI Debt Yield: | 9.1% | |||
Insurance | $45,656 | $5,546 | NAP | U/W NCF Debt Yield: | 8.4% | |||
Replacement Reserves | $0 | $4,625 | NAP | As-Is Appraised Value: | $47,900,000 | |||
TI/LC Reserve | $0 | $12,589 | NAP | As-Is Appraisal Valuation Date: | September 16, 2012 | |||
Deferred Maintenance | $163,156 | $0 | NAP | Cut-off Date LTV Ratio: | 74.1% | |||
Sports Authority Leasing Reserve(1) | $200,000 | $0 | NAP | LTV Ratio at Maturity or ARD: | 60.8% | |||
Toys R Us Leasing Reserve(2) | $886,844 | $113,156 | NAP | |||||
(1) | The Sports Authority Leasing Reserve is a leasing reserve established to fund outstanding tenant improvement expenses associated with Sports Authority, if the tenant chooses to improve the store. If these funds are not drawn, they will remain in escrow for the term of the loan. |
(2) | The Toys R Us Leasing Reserve is a leasing reserve established to fund outstanding tenant improvement expenses associated with Toys R Us. It is expected that the Toys R Us Leasing Reserve will be fully drawn down by the end of the first quarter of 2013. |
The Mortgage Loan. The mortgage loan (the “Bricktown Square Shopping Center Mortgage Loan”) is evidenced by a single promissory note that is secured by a first mortgage encumbering a 292,309 square foot anchored retail center located in Chicago, Illinois (the “Bricktown Square Shopping Center Property”). The Bricktown Square Shopping Center Mortgage Loan was originated on November 6, 2012 by The Royal Bank of Scotland. The Bricktown Square Shopping Center Mortgage Loan had an original principal balance of $35,500,000, has an outstanding principal balance as of the Cut-off Date of $35,500,000 and accrues interest at an interest rate of 4.590% per annum. The Bricktown Square Shopping Center Mortgage Loan had an initial term of 120 months, has a remaining term of 120 months as of the Cut-off Date and requires payment of principal and interest based on a 30-year amortization schedule. The Bricktown Square Shopping Center Mortgage Loan will mature on December 1, 2022.
Following the lockout period, the borrower will have the right to defease the Bricktown Square Shopping Center Mortgage Loan in whole, but not in part, on any due date before the scheduled maturity date. In addition, the Bricktown Square Shopping Center Mortgage Loan is prepayable without penalty on or after September 1, 2022.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
BRICKTOWN SQUARE SHOPPING CENTER |
Sources and Uses(1)
Sources | Uses | |||||||
Original trust loan amount | $35,500,000 | 96.1% | Loan Payoff(2) | $34,866,648 | 94.4% | |||
Sponsor’s new cash contribution | 1,437,327 | 3.9 | Reserves | 1,751,517 | 4.7 | |||
Closing costs | 319,162 | 0.9 | ||||||
Total Sources | $36,937,327 | 100.0% | Total Uses | $36,937,327 | 100.0% |
(1) | The sponsor has approximately $1.4 million of hard equity remaining in the Bricktown Square Shopping Center Property. |
(2) | The debt on the Bricktown Square Shopping Center Property was previously held by BMO Harris Bank N.A. |
The Property. The Bricktown Square Shopping Center Property is an anchored retail center located in Chicago, Illinois. The Bricktown Square Shopping Center Property is anchored by Babies”R”Us, Sports Authority and Capital Fitness (Xsport Fitness) and has major tenants including Walgreens, Conway Stores, Harbor Freight Tools, Aldi and Dollar Tree. Containing approximately 292,309 rentable square feet, the Bricktown Square Shopping Center Property was developed in 1987, acquired by the sponsor in 2004, and renovated in 2008. The Bricktown Square Shopping Center Property is comprised of three multi-tenant buildings on a 24.9-acre lot. As of September 1, 2012, the Bricktown Square Shopping Center Property was 94.2% leased to 19 tenants.
The following table presents certain information relating to the tenancies at the Bricktown Square Shopping Center Property:
Major Tenants
Tenant Name | Credit Rating (Fitch/ Moody’s/ S&P)(1) | Tenant NRSF | % of NRSF | Annual U/W Base Rent PSF(2) | Annual U/W Base Rent(2) | % of Total Annual U/W Base Rent | Sales PSF(3) | Occupancy Cost(3)(4) | Lease Expiration Date | ||||
Anchor Tenants | |||||||||||||
Capital Fitness (XSport) | NR/NR/NR | 35,280 | 12.1% | $14.00 | $493,920 | 13.8% | NAV | NAV | 12/31/2017 | ||||
Babies”R”Us | B/B3/B | 45,083 | 15.4% | $10.85 | 488,985 | 13.7% | NAV | NAV | 1/31/2028 | ||||
The Sports Authority | NR/NR/B- | 36,495 | 12.5% | $9.00 | $328,455 | 9.2% | $146 | 10.4% | 1/31/2018 | ||||
Total Anchor Tenants | 116,858 | 40.0% | $11.22 | $1,311,360 | 36.7% | ||||||||
Major Tenants | |||||||||||||
Walgreens | NR/Baa1/BBB | 14,820 | 5.1% | $32.52 | $482,000 | 13.5% | NAV | NAV | 5/31/2083 | (5) | |||
Conway Stores | NR/NR/NR | 24,000 | 8.2% | $10.50 | $252,000 | 7.1% | $97 | 16.9% | 1/31/2016 | ||||
Harbor Freight Tools | NR/NR/B+ | 20,452 | 7.0% | $12.00 | $245,424 | 6.9% | NAV | NAV | 6/5/2022 | ||||
Aldi | NR/NR/NR | 18,000 | 6.2% | $11.75 | $211,500 | 5.9% | NAV | NAV | 3/31/2017 | ||||
Dollar Tree | NR/NR/NR | 15,310 | 5.2% | $5.50 | $84,205 | 2.4% | NAV | NAV | 4/30/2016 | ||||
Total Major Tenants | 92,582 | 31.7% | $13.77 | $1,275,129 | 35.7% | ||||||||
Non-Major Tenants | 66,046 | 22.6% | $14.96 | $987,947 | 27.6% | ||||||||
Occupied Collateral | 275,486 | 94.2% | $12.98 | $3,574,436 | 100.0% | ||||||||
Vacant Space | 16,823 | 5.8% | |||||||||||
Collateral Total | 292,309 | 100.0% | |||||||||||
(1) | Certain ratings are those of the parent company whether or not the parent guarantees the lease. |
(2) | The underwritten base rent includes contractual rent steps through March of 2013. |
(3) | Sales and occupancy costs are for the trailing 12-month period ending March 31, 2012. |
(4) | Occupancy costs include base rent and reimbursements, as applicable. |
(5) | Beginning on October 31, 2032, Walgreens has the right to terminate its lease every five years through its expiration in 2083. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
BRICKTOWN SQUARE SHOPPING CENTER |
The following table presents certain information relating to the lease rollover schedule at the Bricktown Square Shopping Center Property:
Lease Expiration Schedule(1)(2)
Year Ending December 31, | No. of Leases Expiring | Expiring NRSF | % of Total NRSF | Cumulative Expiring NRSF | Cumulative % of Total NRSF | Annual U/W Base Rent | Annual U/W Base Rent PSF(3) | |
MTM | 0 | 0 | 0.0% | 0 | 0.0% | $0 | $0.00 | |
2012 | 1 | 2,500 | 0.9% | 2,500 | 0.9% | $42,000 | $16.80 | |
2013 | 1 | 4,001 | 1.4% | 6,501 | 2.2% | $100,025 | $25.00 | |
2014 | 2 | 6,466 | 2.2% | 12,967 | 4.4% | $22,404 | $3.46 | |
2015 | 0 | 0 | 0.0% | 12,967 | 4.4% | $0 | $0.00 | |
2016 | 3 | 44,310 | 15.2% | 57,277 | 19.6% | $458,705 | $10.35 | |
2017 | 7 | 97,444 | 33.3% | 154,721 | 52.9% | $1,341,840 | $13.77 | |
2018 | 2 | 40,410 | 13.8% | 195,131 | 66.8% | $393,053 | $9.73 | |
2019 | 0 | 0 | 0.0% | 195,131 | 66.8% | $0 | $0.00 | |
2020 | 0 | 0 | 0.0% | 195,131 | 66.8% | $0 | $0.00 | |
2021 | 0 | 0 | 0.0% | 195,131 | 66.8% | $0 | $0.00 | |
2022 | 1 | 20,452 | 7.0% | 215,583 | 73.8% | $245,424 | $12.00 | |
Thereafter | 2 | 59,903 | 20.5% | 275,486 | 94.2% | $970,985 | $16.21 | |
Vacant | 0 | 16,823 | 5.8% | 292,309 | 100.0% | $0 | $0.00 | |
Total/Weighted Average | 19 | 292,309 | 100.0% | 100.0% | $3,574,436 | $12.98 |
(1) | Information was obtained from the underwritten rent roll. |
(2) | Certain tenants may have lease termination options that are exercisable prior to the stated expiration date of the subject lease and that are not considered in the Lease Expiration Schedule. |
(3) | Weighted Average Annual U/W Base Rent PSF excludes vacant space. |
The following table presents historical occupancy percentages at the Bricktown Square Shopping Center Property:
Historical Occupancy Percentages(1)
12/31/2009 | 12/31/2010 | 12/31/2011 | ||
87% | 90% | 90% |
(1) | Information obtained from the borrower rent rolls. |
Market Overview and Competition. The Bricktown Square Shopping Center Property is located approximately 10 miles northwest of the Chicago central business district. The Bricktown Square Shopping Center Property is located in an urban, in-fill area situated on the northwest corner of West Fullerton Avenue and North Narragansett Avenues. The Bricktown Square Shopping Center Property is adjacent to the Brickyard Shopping Center, a 264,353 square foot retail destination anchored by Jewel/Osco, Marshalls and Office Max. According to the appraisal, the estimated 2012 average household income within a one-, two- and three-mile radius of the Bricktown Square Shopping Center Property was approximately $61,549, $67,108 and $65,503, respectively.
According to the appraisal, the Bricktown Square Shopping Center Property is located in the Chicago retail market and the City North retail submarket. The Chicago retail market vacancy rate ended the first quarter of 2012 at 9.0% while average base rental rates ended the first quarter of 2012 at $16.76 triple net per square foot. The City North submarket vacancy rate ended the first quarter of 2012 at 5.9% while average base rental rates ended the first quarter of 2012 at $21.49 triple net per square foot. Based on recent leasing activity at the Bricktown Square Shopping Center Property and the analysis of comparable properties, the appraiser concluded triple net market rental rates at the Bricktown Square Shopping Center Property of $10.50 per square foot, $11.00 per square foot, $15.00 per square foot and $23.00 triple net per square foot for anchor, junior anchor, side inline and front inline, respectively.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
BRICKTOWN SQUARE SHOPPING CENTER |
The following table presents certain information relating to comparable retail centers for the Bricktown Square Shopping Center Property:
Competitive Set(1)
Bricktown Square Shopping Center (Subject) | Norridge Commons | Brickyard Mall | Harlem- Foster Shopping Center | Dunning Square | Addison Mall | |
Location | Chicago, IL | Norridge, IL | Chicago, IL | Chicago, IL | Chicago, IL | Chicago, IL |
Distance from Subject | -- | 3.2 miles | 0.8 miles | 4.5 miles | 2.8 miles | 6.1 miles |
Property Type | Retail | Retail | Retail | Retail | Retail | Retail |
Year Built/Renovated | 1987/2008 | 1974/NAV | 2004/NAV | 1956/NAV | 1989/NAV | 1985/NAV |
Anchors | Babies R Us, The Sports Authority, Capital Fitness | Kmart, Petco, Staples, Bed Bath & Beyond | Jewel/Osco, Marshalls, Office Max | Jewel/Osco, Burlington Coat Factory | Jewel/Osco, T.J. Maxx | Target |
Total GLA | 292,309 SF | 331,882 SF | 264,353 SF | 280,467 SF | 130,867 SF | 274,204 SF |
Total Occupancy | 94% | 99% | 97% | 87% | 87% | 100% |
(1) | Information obtained from the appraisal dated September 26, 2012. |
The Sponsor. The sponsor for the Bricktown Square Shopping Center Mortgage Loan is Bonnie Management Corporation, which was founded in 1974 as a full service commercial real estate firm headquartered in Chicago, Illinois. The sponsor currently manages properties totaling approximately 1.7 million square feet and ranging from 5,000 square feet to 400,000 square feet. The properties are located in the Midwest portion of the United States, including Illinois, Wisconsin and California.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
Deerfield Embassy Suites | |||||||
Loan Information | Property Information | ||||||
Mortgage Loan Seller: | Liberty Island Group I LLC | Single Asset/Portfolio: | Single Asset | ||||
Credit Assessment (DBRS/KBRA/Moody’s): | NR/NR/NR | Property Type: | Hospitality | ||||
Original Principal Balance: | $32,250,000 | Specific Property Type: | Full Service | ||||
Cut-off Date Principal Balance: | $32,175,919 | Location: | Deerfield Beach, FL | ||||
% of Initial Pool Balance: | TBD | Size: | 244 rooms | ||||
Loan Purpose: | Refinance | Cut-off Date Principal Balance Per Room: | $131,869 | ||||
Borrower Name: | Deerfield Beach ES Hotel, L.L.C. & Deerfield Beach ES Leasing, L.L.C. | ||||||
Sponsor: | FelCor Lodging LP | Year Built/Renovated: | 1986/2006 | ||||
Mortgage Rate: | 4.940% | Title Vesting: | Fee | ||||
Note Date: | September 19, 2012 | Property Manager: | Embassy Suites Management LLC | ||||
Anticipated Repayment Date: | NAP | 3rd Most Recent Occupancy (As of): | 70.9% (12/31/2009) | ||||
Maturity Date: | October 1, 2022 | 2nd Most Recent Occupancy (As of): | 73.7% (12/31/2010) | ||||
IO Period: | None | Most Recent Occupancy (As of): | 68.5% (12/31/2011) | ||||
Loan Term (Original): | 120 months | Current Occupancy (As of): | 67.4% (7/31/2012) | ||||
Seasoning: | 2 months | ||||||
Amortization Term (Original): | 360 months | Underwriting and Financial Information: | |||||
Loan Amortization Type: | Amortizing Balloon | ||||||
Interest Accrual Method: | Actual/360 | 3rd Most Recent NOI (As of): | $4,342,000 (12/31/2010) | ||||
Call Protection: | L(27),GRTR 1% or YM(89),O(4) | 2nd Most Recent NOI (As of): | $4,350,000 (12/31/2011) | ||||
Lockbox Type: | Hard/Springing Cash Management | Most Recent NOI (As of): | $4,275,000 (TTM 7/31/2012) | ||||
Additional Debt: | Yes | ||||||
Additional Debt Type: | Future Mezzanine | U/W Revenues: | $13,767,279 | ||||
U/W Expenses: | $9,744,043 | ||||||
U/W NOI: | $4,023,236 | ||||||
U/W NCF: | $3,472,545 | ||||||
U/W NOI DSCR: | 1.95x | ||||||
Escrows and Reserve: | U/W NCF DSCR: | 1.68x | |||||
U/W NOI Debt Yield: | 12.5% | ||||||
Type: | Initial | Monthly | Cap (If Any) | U/W NCF Debt Yield: | 10.8% | ||
Taxes | $928,457 | $77,371 | NAP | As-Is Appraised Value: | $50,000,000 | ||
Insurance | $4,209 | $383 | NAP | As-Is Appraisal Valuation Date: | August 1, 2012 | ||
FF&E(1) | NAP | NAP | NAP | Cut-off Date LTV Ratio: | 64.4% | ||
Seasonality Reserve(2) | $0 | $85,000 | NAP | LTV Ratio at Maturity or ARD: | 52.9% | ||
(1) | The borrower will not be required to deposit monthly FF&E reserves. At the end of each year the borrower will provide appropriate documentation of FF&E expenditures. If the amount expended exceeds 4% of gross revenues for that year, then the borrower will not be required to deposit with the lender any FF&E amounts but instead will be credited from the reserve for the next year the difference between amounts actually expended and 4% of gross revenues. If the opposite is true and borrower provides documentation showing that less than 4% was expended then borrower will deposit with the lender a lump sum representing the difference between 4% and the amount actually expended. This process shall be ongoing throughout the loan term. |
(2) | The borrower shall maintain a reserve as additional collateral for the loan with lender sufficient to fund certain projected shortfalls in borrower’s ability to pay debt service due during the Off-Season Period (defined as the calendar months of June through November). Commencing with the payment date occurring in November, 2012 and on each and every In-Season Payment date (defined as the calendar months of December through May, inclusive) thereafter for so long as any portion of the debt remains outstanding, borrower must deposit monthly into the Seasonality Reserve funds in an amount equal to $85,000, as such amount may be adjusted from time to time by lender to reflect projected changes in seasonal income. |
The Mortgage Loan. The mortgage loan (the “Deerfield Embassy Suites Mortgage Loan”) is evidenced by a single promissory note that is secured by a first mortgage encumbering the borrower’s fee interest in an Embassy Suites Hotel located in Deerfield Beach, Florida (the “Deerfield Embassy Suites Property”). The Deerfield Embassy Suites Mortgage Loan was originated on September 19, 2012 by Prudential Mortgage Capital Company, LLC. The Deerfield Embassy Suites Mortgage Loan had an original principal balance of $32,250,000, has an outstanding principal balance as of the Cut-off Date of $32,175,919 and accrues interest at an interest rate of 4.940% per annum. The Deerfield Embassy Suites Mortgage Loan had an initial term of 120 months, has a remaining term of 118 months as of the Cut-off Date and requires payments of principal and interest based on a 30-year amortization schedule. The Deerfield Embassy Suites Mortgage Loan will mature on October 1, 2022.
Following the lockout period, the borrower has the right to prepay the Deerfield Embassy Suites Mortgage Loan in whole, but not in part, provided that the borrower pays the greater of a yield maintenance premium or a prepayment premium equal to 1.0% of the principal amount being prepaid. In addition, the Deerfield Embassy Suites Mortgage Loan is prepayable without penalty on or after July 1, 2022.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
DEERFIELD EMBASSY SUITES |
Sources and Uses(1)
Sources | Uses | |||||||
Original trust loan amount | $32,250,000 | 100.0% | Loan payoff(2) | $17,791,335 | 55.2% | |||
Reserves | 1,104,610 | 3.4 | ||||||
Closing costs | 496,737 | 1.5 | ||||||
Return of equity | 12,857,318 | 39.9 | ||||||
Total Sources | $32,250,000 | 100.0% | Total Uses | $32,250,000 | 100.0% |
(1) | The sponsor has approximately $18.4 million of cash equity remaining in the Deerfield Embassy Suites Property based on a cost basis of $50.6 million. |
(2) | The debt on the Deerfield Embassy Suites Property was previously held by Bank of America. |
The Property. The Deerfield Embassy Suites Property is a full service hotel located in Deerfield Beach, Florida. The Deerfield Embassy Suites Property is a seven-story hotel, totaling 244 rooms. The hotel site encompasses 2.23 acres and offers a host of amenities including 10,000 square feet of meeting space, a full service restaurant, a 3,300 square foot spa, an outdoor swimming pool, a whirlpool, a fitness center, a business center, a small retail gift shop and coin operated guest laundry. The Deerfield Embassy Suites Property features all suite-style guestroom configurations with balconies located on all sides. Suites located at the end of the Deerfield Embassy Suites Property have wrap-around balconies. Each guestroom includes a bedroom, a living area, two bathrooms, a 32-inch flat screen LCD TV, a dining/work table, a wet bar with small refrigerator and microwave and coffee maker. The franchise agreement between the Deerfield Embassy Suites Property and Promus Hotels, Inc., an affiliate of Hilton, expires on September 29, 2016.
Market Overview and Competition. The Deerfield Embassy Suites Property is located in Deerfield Beach, Florida near US Route 1 on an island off the east coast of Deerfield Beach in Broward County, Florida. Primary regional access to the area is provided by US Route 1, which spans the length of Florida along the east coast, paralleling Interstate 95. The Deerfield Embassy Suites Property is located approximately 20 miles north of the Fort Lauderdale-Hollywood International Airport and 12 miles east of the Florida Everglades. The Deerfield Embassy Suites Property is also within walking distance of beachfront to the Atlantic Ocean.
The following table presents certain information relating to the Deerfield Embassy Suites Property’s competitive set:
Subject and Market Historical Occupancy, ADR and RevPAR(1)
Competitive Set | Deerfield Embassy Suites | Penetration Factor | |||||||||||||||||
Year | Occupancy | ADR | RevPAR | Occupancy | ADR | RevPAR | Occupancy | ADR | RevPAR | ||||||||||
9/30/2012 TTM | 67.3% | $145.90 | $98.18 | 67.0% | $178.59 | $119.62 | 99.5% | 122.4% | 121.8% | ||||||||||
12/31/2011 | 68.1% | $147.06 | $100.21 | 70.0% | $181.14 | $126.75 | 102.8% | 123.2% | 126.5% | ||||||||||
12/31/2010 | 64.9% | $136.88 | $88.77 | 75.0% | $165.51 | $124.14 | 115.6% | 120.9% | 139.8% |
(1) | Information obtained from a third party hospitality report dated October 18, 2012. |
The Sponsor. The sponsor is FelCor Lodging Limited Partnership, a wholly-owned subsidiary of FelCor Lodging Trust, Inc. (“FelCor Lodging”) that is listed on the New York Stock Exchange. As of August 2012, Felcor Lodging owned 69 hotels and resorts in more than 30 major markets in 22 states. Most are operated under brands such as Doubletree, Embassy Suites Hotels, Fairmont, Hilton, Holiday Inn, Marriott, Renaissance, Sheraton and Westin.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
Parkway Centre V | |||||||
Loan Information | Property Information | ||||||
Mortgage Loan Seller: | Liberty Island Group I LLC | Single Asset/Portfolio: | Single Asset | ||||
Credit Assessment (DBRS/KBRA/Moody’s): | NR/NR/NR | Property Type: | Office | ||||
Original Principal Balance: | $31,400,000 | Specific Property Type: | Suburban | ||||
Cut-off Date Principal Balance: | $31,400,000 | Location: | Plano, TX | ||||
% of Initial Pool Balance: | TBD | Size: | 201,026 SF | ||||
Loan Purpose: | Refinance | Cut-off Date Principal Balance Per Unit/SF: | $156.20 | ||||
Borrower Name: | Sagebrush Partners, LTD. | Year Built/Renovated: | 2009/NAP | ||||
Sponsor: | Vaughn Randy Heady Jr. | Title Vesting: | Fee | ||||
Mortgage Rate: | 4.290% | Property Manager: | Stream Realty Partners - DFW, L.P. | ||||
Note Date: | November 8, 2012 | 3rd Most Recent Occupancy (As of): | 47.1% (12/31/2010) | ||||
Anticipated Repayment Date: | NAP | 2nd Most Recent Occupancy (As of): | 78.9% (12/31/2011) | ||||
Maturity Date: | December 1, 2022 | Most Recent Occupancy (As of): | 97.9% (TTM 8/31/2012) | ||||
IO Period: | None | Current Occupancy (As of): | 92.9% (10/01/2012) | ||||
Loan Term (Original): | 120 months | ||||||
Seasoning: | 0 months | Underwriting and Financial Information: | |||||
Amortization Term (Original): | 360 months | ||||||
Loan Amortization Type: | Amortizing Balloon | 3rd Most Recent NOI (As of): | $288,615 (12/31/2010) | ||||
Interest Accrual Method: | Actual/360 | 2nd Most Recent NOI (As of): | $949,230 (12/31/2011) | ||||
Call Protection: | L(24),D(92),O(4) | Most Recent NOI (As of): | $1,719,755 (TTM 8/31/2012) | ||||
Lockbox Type: | Hard/Springing Cash Management | ||||||
Additional Debt: | None | U/W Revenues: | $4,840,604 | ||||
Additional Debt Type: | NAP | U/W Expenses: | $1,718,490 | ||||
U/W NOI: | $3,122,114 | ||||||
U/W NCF: | $2,770,304 | ||||||
Escrows and Reserves: | U/W NOI DSCR: | 1.68x | |||||
U/W NCF DSCR: | 1.49x | ||||||
Type: | Initial | Monthly | Cap (If Any) | U/W NOI Debt Yield: | 9.9% | ||
Taxes | $117,304 | $58,652 | NAP | U/W NCF Debt Yield: | 8.8% | ||
Insurance | $56,149 | $5,104 | NAP | As-Is Appraised Value: | $42,600,000 | ||
Replacement Reserves | $3,350 | $3,350 | NAP | As-Is Appraisal Valuation Date: | September 11, 2012 | ||
TI/LC(1) | $0 | $21,500 | $1,000,000 | Cut-off Date LTV Ratio: | 73.7% | ||
Fitness Evolution Reserve(2) | $1,000,000 | NAP | NAP | LTV Ratio at Maturity or ARD: | 59.2% |
(1) | Leasing reserve collection begins March 1, 2013. Upon request by the borrower, at the beginning of the third loan year the cap may be adjusted to equal $10.00 times the maximum number of square feet expiring in any one calendar year for each year beginning 2015 and ending 24 months subsequent to loan maturity. In the event lease expirations change during this time and the cap would increase the lender will provide notice to the borrower of the higher cap amount. |
(2) | In connection with the Litigation (as described above), the borrower has established with the lender a reserve as additional collateral for the loan in the amount of $1,000,000, which represents estimated rental income for the number of months outstanding on the terminated lease plus legal fees. The borrower shall, at all times while the Litigation is outstanding, use commercially reasonable efforts to defend, or cause to be defended, the borrower’s position in the Litigation. Reserve will be released when the borrower needs the funds for settlement purposes, or if the Litigation is dismissed. |
The Mortgage Loan. The mortgage loan (the “Parkway Centre V Mortgage Loan”) is evidenced by a single promissory note that is secured by a first mortgage encumbering a suburban office building in Plano, Texas (the “Parkway Centre V Property”). The Parkway Centre V Mortgage Loan was originated on November 8, 2012 by Prudential Mortgage Capital Company, LLC. The Parkway Centre V Mortgage Loan had an original principal balance of $31,400,000, has an outstanding principal balance as of the Cut-off Date of $31,400,000 and accrues interest at an interest rate of 4.290% per annum. The Parkway Centre V Mortgage Loan had an initial term of 120 months, has a remaining term of 120 months as of the Cut-off Date and requires payments of principal and interest based on a 30-year amortization schedule. The Parkway Centre V Mortgage Loan matures on December 1, 2022.
Following the lockout period, the borrower has the right to defease the Parkway Centre V Mortgage Loan in whole, but not in part, on any due date before the scheduled maturity date. In addition, the Parkway Centre V Mortgage Loan is prepayable without penalty on or after September 1, 2022.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
PARKWAY CENTRE V |
Sources and Uses
Sources | Uses | |||||||
Original trust loan amount | $31,400,000 | 100.0% | Purchase price/loan payoff(1) | $21,750,785 | 69.3% | |||
Closing Costs | 780,924 | 2.5 | ||||||
Reserves | 1,418,071 | 4.5 | ||||||
Return of equity | 7,450,220 | 23.7 | ||||||
Total Sources | $31,400,000 | 100.0% | Total Uses | $31,400,000 | 100.0% |
(1) | The debt on the Parkway Centre V Property was previously held by Stillwater National Bank and Trust Co. |
The Property. The Parkway Centre V Property is a six-story class A suburban office building containing approximately 201,026 rentable square feet in Plano, Texas. The Parkway Centre V Property was built in 2009 and is situated on an 8.2-acre parcel along the Dallas Parkway and Parkwood Boulevard. The building includes a brick and stone exterior and a lobby with polished tile finishes and tenant amenities include a 15,606 square foot gymnasium. Parking is provided by a two-level parking structure as well as additional parking spaces surrounding the building, which account for 797 total spaces and a parking ratio of 3.96 spaces per 1,000 square feet of rentable area. As of October 1, 2012, the Parkway Centre V Property was 92.9% leased to 30 tenants.
The following table presents certain information relating to the tenancies at the Parkway Centre V Property:
Major Tenants
Tenant Name | Credit Rating (Fitch/Moody’s/ S&P) | Tenant NRSF | % of NRSF | Annual U/W Base Rent PSF | Annual U/W Base Rent | % of Total Annual U/W Base Rent | Lease Expiration Date | ||
Major Tenants | |||||||||
Montgomery Coscia Greilich LLP | NR/NR/NR | 34,631 | 17.2% | $25.13 | $870,144 | 18.7% | 1/31/2017 | ||
Aimbridge Hospitality | NR/NR/NR | 25,131 | 12.5% | $25.25 | $634,558 | 13.7% | 6/2/2019 | ||
VuComp | NR/NR/NR | 17,586 | 8.7% | $25.15 | $442,288 | 9.5% | 2/28/2017 | ||
Willow Bend Fitness | NR/NR/NR | 11,482 | 5.7% | $23.52 | $270,000 | 5.8% | 12/1/2019 | ||
Comm Group | NR/NR/NR | 9,541 | 4.7% | $24.75 | $236,140 | 5.1% | 5/31/2015 | ||
Fifth Third Bank | NR/NR/NR | 6,764 | 3.4% | $24.75 | $167,409 | 3.6% | 2/28/2017 | ||
Total Major Tenants | 105,135 | 52.3% | $24.93 | $2,620,539 | 56.4% | ||||
Non-Major Tenants | 81,644 | 40.6% | $24.77 | $2,022,344 | 43.6% | ||||
Occupied Collateral Total | 186,779 | 92.9% | $24.86 | $4,642,883 | 100.0% | ||||
Vacant Space(1) | 14,247 | 7.1% | |||||||
Collateral Total | 201,026 | 100.0% | |||||||
(1) | Actual vacancy is 1.6%, which includes vacant space on ground floor of 745 square feet, property management office of 756 square feet and owner occupied space of 1,634 square feet. Montgomery Coscia Greilich LLP has two expansion spaces of 5,550 square feet and 4,460 square feet that were underwritten as vacant due to a termination option that can be exercised at any time with six months notice. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
PARKWAY CENTRE V |
The following table presents certain information relating to the lease rollover schedule at the Parkway Centre V Property:
Lease Expiration Schedule(1)(2)
Year Ending December 31, | No. of Leases Expiring | Expiring NRSF | % of Total NRSF | Cumulative Expiring NRSF | Cumulative % of Total NRSF | Annual U/W Base Rent | Annual U/W Base Rent PSF(3) | |
MTM | 0 | 0 | 0.0% | 0 | 0.0% | $0 | $0.00 | |
2012 | 0 | 0 | 0.0% | 0 | 0.0% | $0 | $0.00 | |
2013 | 0 | 0 | 0.0% | 0 | 0.0% | $0 | $0.00 | |
2014 | 6 | 22,334 | 11.1% | 22,334 | 11.1% | $553,395 | $24.78 | |
2015 | 5 | 20,856 | 10.4% | 43,190 | 21.5% | $511,545 | $24.53 | |
2016 | 5 | 13,368 | 6.6% | 56,558 | 28.1% | $333,345 | $24.94 | |
2017 | 8 | 81,066 | 40.3% | 137,624 | 68.5% | $2,016,792 | $24.88 | |
2018 | 3 | 5,960 | 3.0% | 143,584 | 71.4% | $152,117 | $25.52 | |
2019 | 2 | 36,613 | 18.2% | 180,197 | 89.6% | $904,558 | $24.71 | |
2020 | 1 | 6,582 | 3.3% | 186,779 | 92.9% | $171,132 | $26.00 | |
2021 | 0 | 0 | 0.0% | 186,779 | 92.9% | $0 | $0.00 | |
2022 | 0 | 0 | 0.0% | 186,779 | 92.9% | $0 | $0.00 | |
Thereafter | 0 | 0 | 0.0% | 186,779 | 92.9% | $0 | $0.00 | |
Vacant | 0 | 14,247 | 7.1% | 201,026 | 100.0% | $0 | $0.00 | |
Total/Weighted Average | 30 | 201,026 | 100.0% | $4,642,883 | $24.86 |
(1) | Information obtained from the underwritten rent roll. |
(2) | Certain tenants may have lease termination options that are exercisable prior to the stated expiration date of the subject lease and that are not considered in the Lease Expiration Schedule. |
(3) | Weighted Average Annual U/W Base Rent PSF excludes vacant space. |
The following table presents historical occupancy percentages at the Parkway Centre V Property:
Historical Occupancy Percentages(1)
12/31/2010 | 12/31/2011 | TTM 8/31/2012 | ||
47% | 79% | 98% |
(1) | Information obtained from borrower rent rolls. |
Market Overview and Competition. According to the appraisal, the Parkway Centre V Property is located in suburban Plano, Texas, and is located approximately 22 miles north of the Dallas central business district. The Parkway Centre V Property is located along the Dallas Parkway, a feeder road to the Dallas Tollway. In addition, the Parkway Centre V Property is located approximately two miles south of the 2,655 acre Legacy Business Park, a major master-planned business, retail, commercial and residential community that is home to various Fortune 500 corporate/regional headquarters. The population within a three-mile and five-mile radius of the Parkway Centre V Property is 112,735 and 308,746, respectively. The estimated average household income within the same three-mile and five-mile radii is $108,171 and $100,051, respectively.
According to the appraisal, the Parkway Centre V Property is located within the West Plano/Upper Tollway office submarket, which contains approximately 14.1 million square feet of office space. The submarket vacancy is approximately 10.2% as of the second quarter of 2012. The appraiser estimated average modified gross market rents of $25.00 per square foot for the office space at the Parkway Centre V Property.
The following table presents certain information relating to some comparable office properties provided in the appraisal for the Parkway Centre V Property:
Competitive Set(1)
Parkway Centre V (Subject) | Lincoln Legacy One | One Legacy Circle | Park Center Office | Parkway Centre IV | Three Legacy Tower Center | |
Location | Plano, TX | Plano, TX | Plano, TX | Plano, TX | Plano, TX | Plano, TX |
Distance from Subject | -- | 2.7 miles | 3.4 miles | 0.8 miles | 1.4 miles | 2.9 miles |
Property Type | Office | Office | Office | Office | Office | Office |
Year Built/Renovated | 2009/NAP | 2006/NAP | 2008/NAP | 2000/NAP | 2006/NAP | 2006/NAP |
Total GLA | 201,026 SF | 207,834 SF | 214,110 SF | 234,740 SF | 157,350 SF | 156,107 SF |
Total Occupancy | 98% | 99% | 100% | 91% | 77% | 100% |
(1) | Information obtained from the appraisal dated September 24, 2012. |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
PARKWAY CENTRE V |
The Sponsor. The sponsor for the Parkway Centre V Mortgage Loan is Vaughn Randy Heady Jr. Vaughn Randy Heady Jr. has developed over two million square feet of office properties within the Dallas area in the past 35 years. Vaughn Randy Heady Jr. has also served on the board of governors of the Commercial Investment Division from 1975-1977 and has served on the board of directors of Republic Bank Richardson from 1980 to 1987.
The sponsor reported that the borrower and the sponsor are named defendants in a civil case in the 296th District Court, Collins County, Texas, titled Cause Number 296-00529-2010; Fitness Evolution, LP and Joseph Mulroy v. Headhunter Fitness, LLC, et. al. (the “Litigation”) brought by Fitness Evolution, LP and Joseph Mulroy, the guarantor of a tenant at an unrelated property, to reoup monies paid in connection with the termination of the tenant’s lease. The borrower established a reserve with the lender, which is estimated to sufficiently address damages related to any outcome adverse to the defendants.
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.
WFRBS Commercial Mortgage Trust 2012-C10 | Transaction Contact Information |
Transaction Contact Information
Questions may be directed to any of the following individuals:
Wells Fargo Securities, LLC | RBS Securities Inc. | ||
Brigid Mattingly | Tel. (312) 269-3062 | Jeff Wilson | Tel. (203) 897-2900 |
Fax (312) 658-0140 | |||
A.J. Sfarra | Tel. (212) 214-5613 | Adam Ansaldi | Tel. (203) 897-0881 |
Fax (212) 214-8970 | Fax (203) 873-3542 | ||
Matthew Orrino | Tel. (212) 214-5608 | Jim Barnard | Tel. (203) 897-4417 |
Fax (212) 214-8970 | Fax (203) 873-4310 |
THE INFORMATION IN THIS STRUCTURAL AND COLLATERAL TERM SHEET IS NOT COMPLETE AND MAY BE AMENDED PRIOR TO THE TIME OF SALE. THIS TERM SHEET IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT A SOLICITATION OF AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED.