Fitch Affirms WFCM 2012-LC5

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has affirmed 12 classes of Wells Fargo Commercial Mortgage Trust 2012-LC5 commercial mortgage pass-through certificates, series 2012-LC5. A detailed list of rating actions follows at the end of this release.

KEY RATING DRIVERS

The affirmations reflect stable pool performance since issuance. The pool has no specially serviced or delinquent loans as of the June 2016 distribution date. The pool's aggregate principal balance has been reduced by 4.9% to $1.21 billion from $1.28 billion at issuance. Approximately 0.7% of the pool is defeased. There are five loans on the servicer watch list; however, only two are considered Fitch Loans of Concern (2.2% of the pool).

There was one variance from criteria related to class C. The surveillance criteria indicated that a rating upgrade above the recommended rating was possible for the class. Fitch has determined an upgrade is not warranted at this time due to non-material changes since issuance.

The largest Fitch Loan of Concern (1.7% of the pool) is secured by a 78,514 square foot (sf) office building located in downtown Washington, DC in close proximity to the White House. Occupancy has fluctuated historically, which has affected performance since issuance. Occupancy dropped from 95% at issuance to 76% as of year-end (YE) 2013 and 67% as of YE 2014. As of YE 2015, the net operating income (NOI) debt service coverage ratio (DSCR) and occupancy were 0.67x and 86%, respectively. While occupancy has recently increased, another large tenant is scheduled to vacate the property this year. Fitch will continue to monitor.

The largest loan in the pool (12% of the pool) is The Westside Pavilion, a 755,448 sf, three-level urban mall, 535,448 sf of which serves as the collateral for the loan. The property is located in Los Angeles, CA and anchored by Macy's (non-collateral), Macy's Home, Nordstrom, and Landmark Theatres. Performance has remained stable since issuance; as of YE 2015, the subject was 93% occupied with a 1.65x NOI DSCR.

RATING SENSITIVITIES

Rating Outlooks remain Stable for classes A-1 through A-S and classes D through F as overall pool performance has been stable since issuance. The Positive Outlooks on classes B, C, and X-B reflect an increase in class credit enhancement, position in the capital structure, and potential paydown from maturities in 2017. Upgrades may occur with stable to improved pool performance and significant paydown or defeasance. Additional information on rating sensitivity is available in the 'Wells Fargo Commercial Mortgage Trust 2012-LC5' (Oct. 17, 2012) New Issue report, available at www.fitchratings.com.

DUE DILIGENCE USAGE

No third-party due diligence was provided or reviewed in relation to this rating action.

Fitch has affirmed the following ratings and revised Outlooks where indicated:

--$18.3 million class A-1 at 'AAAsf'; Outlook Stable;

--$156.2 million class A-2 at 'AAAsf'; Outlook Stable;

--$556.7 million class A-3 at 'AAAsf'; Outlook Stable;

--$100 million class A-SB at 'AAAsf'; Outlook Stable;

--$955,730,628* class X-A 'AAAsf'; Outlook Stable;

--$118,138,000* class X-B 'A-sf'; Outlook to Positive from Stable;

--$124.5 million class A-S at 'AAAsf'; Outlook Stable;

--$76.6 million class B at 'AA-sf'; Outlook to Positive from Stable;

--$41.5 million class C at 'A-sf'; Outlook to Positive from Stable;

--$49.5 million class D at 'BBB-sf'; Outlook Stable;

--$20.8 million class E at 'BBsf'; Outlook Stable;

--$23.9 million class F at 'Bsf'; Outlook Stable.

*Notional amount and interest only.

Fitch does not rate the class G certificates.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Counterparty Criteria for Structured Finance and Covered Bonds (pub. 14 May 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158

Criteria for Rating Caps and Limitations in Global Structured Finance Transactions (pub. 16 Jun 2016)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=882401

Global Structured Finance Rating Criteria (pub. 27 Jun 2016)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=883130

U.S. and Canadian Fixed-Rate Multiborrower CMBS Surveillance and U.S. Re-REMIC Criteria (pub. 13 Nov 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=873395

Related Research

Wells Fargo Commercial Mortgage Trust 2012-LC5 -- Appendix

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=692490

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1008591

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1008591

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160707006359/en/

Fitch Ratings
Primary Analyst
Martin Nunnally
Associate Director
+1-212-908-0871
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Committee Chairperson
Christopher Bushart
Senior Director
+1-212-908-0606
or
Media Relations
Sandro Scenga
+1-212-908-0278
New York
[email protected]

Source: Fitch Ratings

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Allison Transmission Holdings Set to Join S&P MidCap 400 and Goodyear Tire & Rubber to Join S&P SmallCap 600
• Avicanna Announces Promotion of Nick Hilborn CPA CA to Chief Financial Officer
• Hoffman & Hoffman Enters Florida Market with Acquisition of Aeromechanical, LLC