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Kroll Bond Ratings Affirms Ratings on All Classes of GSMS 2012-SHOP

Kroll Bond Rating Agency (KBRA) affirmed its ratings on all six classes of GSMS 2012-SHOP certificates, a $625.0 million Single-Borrower CMBS Transaction (see ratings list below). The transaction collateral is a single, non-recourse, first lien mortgage loan secured by the fee simple and leasehold interests in 815,587 sf of two interconnected specialty retail centers, The Grand Canal Shoppes and The Shoppes at The Palazzo, located along Las Vegas Boulevard South, also known as the “Strip,” in Las Vegas, Nevada. The Grand Canal Shoppes consist of 499,247 sf and The Shoppes at The Palazzo consist of 316,340 sf. The Grand Canal Shoppes are located within the Venetian Resort Hotel Casino and The Shoppes at The Palazzo are located in the Palazzo Resort Hotel Casino, both of which are operated by Las Vegas Sands Corporation (LVS).

For the trailing twelve months (TTM) ending March 2013, in-line tenants occupying less than 10,000 sf generated sales of $1,006 per sf, up 2.1% from $986 per sf at securitization. The current sales performance is more than double the International Council of Shopping Centers (ICSC) average national mall sales, which were $460 per sf as of June 2013, and 81.3% above the ICSC US West region sales, which were $555 per sf as of June 2013. The property also exhibited strong performance in the midst of the economic crisis, having generated sales of $892 per sf in 2009.

KBRA used information obtained from the trustee, U.S. Bank National Association, and servicer, Wells Fargo Bank, National Association, to analyze the loan collateral. The analysis produced a KBRA Net Cash Flow (KNCF) of $69.1 million and a KBRA value of $952.6 million, both of which have improved 1.2% since issuance. The resulting in-trust KBRA Loan to Value (KLTV) was 65.6%.

Class         Rating         Balance (USD)         Rating Action
A         AAA (sf)         478,000,000         Affirmed
X-A         AAA (sf)         478,000,000*         Affirmed
X-B         AAA (sf)         147,000,000*         Affirmed
B         AA- (sf)         76,600,000         Affirmed
C         A (sf)         53,050,000         Affirmed
D         A- (sf)         17,350,000         Affirmed

*Notional Amount

Related Publications (available at

GSMS 2012-SHOP Certificate Ratings Under Review
GSMS 2012-SHOP Presale Report
CMBS Property Evaluation Guidelines
CMBS Single Borrower and Large Loan Rating Methodology


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