Morgan Stanley and Bank of America will issue a $1.3 billion CMBS conduit that has been assigned preliminary rating by Kroll Bond Rating Agency (KBRA).
The transaction called MSBAM 2013-C12 is collateralized by 72 fixed-rate commercial mortgage loans that are secured by 93 properties. The structure will offer investors 17 tranches of notes that range in ratings starting at ‘AAA’ and down the credit curve to ‘B’.
Retail loans have the biggest representation in the deal and account for 47.5% of the securitization pool. The loans have principal balances ranging from $2.4 million to $130.0 million for the largest loan in the pool, which is secured by Merrimack Premium Outlets, a 408,996 sf retail outlet center located in Merrimack, New Hampshire.
The collateral properties are located in 23 different states, with four state exposures that each account for more than 10.0% of the pool balance: Texas (13.4%), New York (11.4%), Florida (10.9%), and New Hampshire (10.2%).
MSBAM 2013-C12 includes loan with a higher weight average LTV of 98% compared to the weighted average LTV of 96% for the last 16 CMBS transaction rated by KBRA, in the past six months. However, the pool’s exposure to high leverage loans, which KBRA defines as loans with LTVs in excess of 100%, is lower than the average seen this year.