FWP 1 fwp.htm FREE WRITING PROSPECTUS Unassociated Document
 
 
 
   
FREE WRITING PROSPECTUS
   
FILED PURSUANT TO RULE 433
   
REGISTRATION FILE NO.: 333-177354-03
     
 
UBS Investment Bank
 Barclays Capital
 

August 28, 2012
 
Free Writing Prospectus
 
UBS-Barclays Commercial Mortgage Trust 2012-C3,
Commercial Pass-Through Certificates,
Series 2012-C3
 
IMPORTANT NOTICE RELATING TO AUTOMATICALLY GENERATED EMAIL
DISCLAIMERS
 
Any legends, disclaimers or other notices that may appear at the bottom of the 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 being made 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.
 
This Free Writing Prospectus is not an offer to sell or a solicitation of an offer to buy these securities in any state where such offer, solicitation or sale is not permitted. The securities offered by these materials are being offered when, as and if issued.  You are advised that the terms of the offered certificates, and the characteristics of the mortgage loan pool backing them, may change (due, among other things, to the possibility that mortgage loans that comprise the pool may become delinquent or defaulted or may be removed or replaced and that similar or different mortgage loans may be added to the pool, and that one or more classes of the offered certificates may be split, combined or eliminated), at any time prior to the time sales to purchasers of the offered certificates will first be made.  You are advised that offered certificates may not be issued that have the characteristics described in these materials.  An underwriter’s obligation to sell the offered certificates to you is conditioned on the mortgage loans and offered certificates having the characteristics described in these materials.  If for any reason the depositor does not deliver the offered certificates, the underwriter will notify you, and neither the depositor nor any underwriter will have any obligation to you to deliver all or any portion of the offered certificates which you have committed to purchase.
 
The information in this Free Writing Prospectus, if conveyed prior to the time of your contractual commitment to purchase any of the offered certificates, supersedes any conflicting information contained in any prior similar materials relating to the offered certificates.  The information in this document may be amended or supplemented prior to the time of your contractual commitment to purchase any of the offered certificates.  This Free Writing Prospectus is being delivered to you solely to provide you with information about the offered certificates and to solicit an offer to purchase the offered certificates, when, as and if issued.  Any such offer to purchase made by you will not constitute a contractual commitment by you to purchase or give rise to an obligation by the underwriters to sell any of the offered certificates, until the underwriters have accepted your offer to purchase those certificates.  Any “indications of interest” expressed by you, and any “soft circles” generated by us, will not create binding contractual obligations for you or us.
 
The information contained in this Free Writing Prospectus may not pertain to any securities that will actually be sold.  The information contained in this Free Writing Prospectus may be based on assumptions regarding market conditions and other matters as reflected in this Free Writing Prospectus.  We make no representations regarding the reasonableness of such assumptions or the likelihood that any of such assumptions will coincide with actual market conditions or events, and this Free Writing Prospectus should not be relied upon for such purposes.  We and our affiliates, officers, directors, partners and employees, including persons involved in the preparation or issuance of this Free Writing Prospectus may, from time to time, have long or short positions in, and buy or sell, the securities mentioned in this Free Writing Prospectus or derivatives thereof (including options).  Neither UBS Securities LLC nor Barclays Capital Inc. provides accounting, tax or legal advice.
 
 
 
 
 
 
 
 
 
 

 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
 

 
 
1000 Harbor Boulevard
Weehawken, NJ 07086
Collateral Asset Summary
1000 Harbor Boulevard
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$120,000,000
64.2%
1.47x
7.4%
           
Mortgage Loan Information
 
Property Information
Loan Seller:
UBSRES
 
Single Asset / Portfolio:
Single Asset
Loan Purpose:
Refinance
 
Property Type:
Office - CBD
Sponsor:
Hartz Mountain Industries, Inc.
 
Collateral:
Fee Simple
Borrower:
1000 Harbor Boulevard, L.L.C.
 
Location:
Weehawken, NJ
Original Balance(1):
$120,000,000
   
Year Built / Renovated:
1989 / NAP
Cut-off Date Balance:
$120,000,000
   
Total Sq. Ft.(5):
617,187
% by Initial UPB:
TBD%
   
Property Management:
Hartz Mountain Industries, Inc.
Interest Rate(2):
4.8730%
   
Underwritten NOI:
$8,878,786
Payment Date:
6th of each month
 
Underwritten NCF:
$8,710,469
First Payment Date:
October 6, 2012
 
Appraised Value:
$187,000,000
Anticipated Repayment Date(2)(3):
September 6, 2022
 
Appraisal Date:
August 1, 2012
Maturity Date(2):
December 6, 2028
     
Amortization:
None
   
Historical NOI
Additional Debt:
None
   
Most Recent NOI:
$12,735,286 (T-12 June 30, 2012)
Call Protection:
L(24), D(92), O(4)
 
2nd Most Recent NOI:
$12,448,849 (December 31, 2011)
Lockbox / Cash Management:
Springing Hard / Springing
 
3rd Most Recent NOI:
$12,515,599 (December 31, 2010)
       
4thd Most Recent NOI:
$12,580,029 (December 31, 2009)
Reserves(4)
     
 
Initial
Monthly
 
Historical Occupancy(6)
Taxes:
$0
Springing
 
Most Recent Occupancy:
100.0% (T-12 June 30, 2012)
Insurance:
$0
Springing
 
2nd Most Recent Occupancy:
100.0% (December 31, 2011)
       
3rd Most Recent Occupancy:
100.0% (December 31, 2010)
Financial Information
 
4th Most Recent Occupancy:
100.0% (December 31, 2009)
Cut-off Date Balance / Sq. Ft.:
 
$194
     
Balloon Balance / Sq. Ft.:
 
$194
 
Historical Annual Rent Per Sq. Ft.(6)
Cut-off Date LTV:
 
64.2%
 
Most Recent Rent Per Sq. Ft.:
$20.31 (T-12 June 30, 2012)
Balloon LTV:
 
64.2%
 
2nd Most Recent Rent Per Sq. Ft.:
$20.31 (December 31, 2011)
Underwritten NOI DSCR:
 
1.50x
 
3rd Most Recent Rent Per Sq. Ft.:
$20.31 (December 31, 2010)
Underwritten NCF DSCR:
 
1.47x
 
4th Most Recent Rent Per Sq. Ft.:
$20.31 (December 31, 2009)
Underwritten NOI Debt Yield:
 
7.4%
 
(1)   Original Balance represents the entire first mortgage financing.  The 1000 Harbor Boulevard Loan (as defined herein) may be bifurcated into two pari passu notes and it is expected that the note to be contributed to the UBS-B 2012-C3 Trust will be the controlling note.  The size of each note has yet to be determined, but it is anticipated that the note in this Trust will have the larger principal balance.
(2)   The 1000 Harbor Boulevard loan accrues interest at a rate per annum equal to 4.8730% (“Regular Interest Rate”) prior to the Anticipated Repayment Date (“ARD”). Thereafter, the interest rate is a rate per annum equal to (i) with respect to each interest accrual period (as defined in the loan documents) occurring after the ARD through the interest accrual period which ends immediately following the payment date occurring in September, 2024, the sum of (1) 4.0% and (2) 3.0% plus the greater of (x) 0.0% and (y) and amount by which the Treasury Index Rate (as defined in the loan documents) exceeds 4.0%; and (ii) with respect to each subsequent monthly payment date, through and including the Maturity Date, the sum of (1) 0.0% and (2) 8.0% plus the greater of (x) 0.0% and (y) an amount by which the Treasury Index Rate exceeds 4.0%.
(3)   Commencing on the anticipated repayment date (the “ARD”), (i) the interest rate will increase as set forth in the loan documents above, (ii) all excess cash flow (net of scheduled debt service, required reserves, approved operating expenses and other items required under the loan documents) will be swept and applied to the repayment of the outstanding principal balance and the payment of any accrued interest (with respect to any interest above the interest rate applicable prior to the ARD) and (iii) the loan will be prepayable without penalty or premium.
(4)   See “Initial Reserves” and “Ongoing Reserves” herein.
(5)   Of the 617,187 sq. ft., UBS occupies 589,405 sq. ft. The UBS space will be reduced by 2,969 sq. ft. to 586,216 sq. ft. effective 1/1/14.
(6)   Historical Occupancy and Historical Annual Rent Per Sq. Ft. are based on historical rent roll and occupancy percentages provided by the Borrower.
Underwritten NCF Debt Yield:
 
7.3%
 
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
       
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
2

 
 
1000 Harbor Boulevard
Weehawken, NJ 07086
Collateral Asset Summary
1000 Harbor Boulevard
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$120,000,000
64.2%
1.47x
7.4%
 
Tenant Summary
Tenant
 
Ratings
(Fitch/Moody’s/S&P)(1)
 
Net
Rentable
Area
(Sq. Ft.)
 
% of Net
Rentable
Area(2)
 
U/W Base
Rent Per Sq.
Ft.(3)
 
% of Total
Annual U/W
Base Rent(3)(4)
 
Lease Expiration
UBS(5)
 
A/A2/A
 
589,405
   
95.5
 
$14.64
 
95.4
 
12/31/2028
Subtotal / Wtd. Avg.
     
589,405
   
95.5
 
$14.64
 
95.4
   
                               
Hartz Mountain
 
NAP
 
27,782
   
4.5
 
$15.00
 
4.6
 
6/30/2022
Vacant
 
NAP
 
0
   
0.0
   
NAP
 
     NAP
 
NAP
Total / Wtd. Avg.(6)
     
617,187
   
100.0
 
$14.65
 
100.0
   
(1)
Certain ratings are those of the parent company whether or not the parent company guarantees the lease.
(2)
% of Net Rentable Area is based on total sq. ft. of 617,187 per the June 30, 2012 rent roll.
(3)
U/W Base Rent Per Sq. Ft. and % of Total Annual U/W Base Rent includes a negative straight-line rent adjustment for UBS rent decreasing by 35% on January 1, 2014.
(4)
% of Total Annual U/W Base Rent is based on total occupied underwritten base rent and excludes any gross up of vacant space.
(5)
Of the 617,187 sq. ft., UBS occupies 589,405 sq. ft.  The UBS space will be reduced by 2,969 sq. ft. to 586,436 sq. ft. effective 1/1/14.
(6)
Weighted Average U/W Annual Base Rent Per Sq. Ft. is based on total occupied sq. ft. of 617,187.
 
Lease Rollover Schedule
 
Year
# of
Leases
Expiring
Total
Expiring
Sq. Ft.
% of Total Sq.
Ft. Expiring
Cumulative
Sq. Ft.
Expiring
Cumulative % of
Sq. Ft. Expiring
Annual U/W
Base Rent
Per Sq. Ft.(1)(2)
% U/W
Base Rent
Rolling(1)(2)
Cumulative %
of U/W
Base Rent(1)(2)
  MTM
0
 
0
 
0.0
0
 
0.0%
 
$0.00
 
           0.0
0.0%
 
  2012
0
 
0
 
0.0
 
0
 
0.0%
 
$0.00
 
0.0
 
0.0%
 
  2013
0
 
0
 
0.0
 
0
 
0.0%
 
$0.00
 
0.0
 
0.0%
 
  2014
0
 
0
 
0.0
 
0
 
0.0%
 
$0.00
 
0.0
 
0.0%
 
  2015
0
 
0
 
0.0
 
0
 
0.0%
 
$0.00
 
0.0
 
0.0%
 
  2016
0
 
0
 
0.0
 
0
 
0.0%
 
$0.00
 
0.0
 
0.0%
 
  2017
0
 
0
 
0.0
 
0
 
0.0%
 
$0.00
 
0.0
 
0.0%
 
  2018
0
 
0
 
0.0
 
0
 
0.0%
 
$0.00
 
0.0
 
0.0%
 
  2019
0
 
0
 
0.0
 
0
 
0.0%
 
$0.00
 
0.0
 
0.0%
 
  2020
0
 
0
 
0.0
 
0
 
0.0%
 
$0.00
 
0.0
 
0.0%
 
  2021
0
 
0
 
0.0
 
0
 
0.0%
 
$0.00
 
0.0
 
0.0%
 
  2022
1
 
27,782
 
4.5
 
27,782
 
4.5%
 
$15.00
 
4.6
 
4.6%
 
  Thereafter
1
 
589,405
 
95.5
 
617,187
 
100.0%
 
$14.64
 
95.4
 
100.0%
 
  Vacant
NAP
 
0
 
0.0
 
617,187
 
100.0%
 
NAP
 
NAP
     
  Total / Wtd. Avg.
2
 
617,187
 
100.0
       
$14.65
 
100.0
   
(1)
Annual U/W Base Rent Per Sq. Ft., % U/W Base Rent Rolling and Cumulative % of U/W Base Rent include contractual rent steps.
(2)
Annual U/W Base Rent Per Sq. Ft., % U/W Base Rent Rolling and Cumulative % of U/W Base Rent are based on the underwritten occupied base rent and underwritten occupied sq. ft. as well as a negative straight-line rent adjustment due to UBS rent decreasing by 35% on January 1, 2014, and exclude any gross up of vacant space.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to  send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
3

 
 
1000 Harbor Boulevard
Weehawken, NJ 07086
Collateral Asset Summary
1000 Harbor Boulevard
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$120,000,000
64.2%
1.47x
7.4%
 
The Loan. The 1000 Harbor Boulevard loan (the “1000 Harbor Boulevard Loan”) is a $120.0 million, fixed rate, first mortgage loan secured by the borrower’s fee simple interest in a 617,187 sq. ft. Class A office building located at 1000 Harbor Boulevard in Weehawken, New Jersey (the “1000 Harbor Boulevard Property”), which is part of Lincoln Harbor, a master planned community. The loan documents provide for a maturity date of December 6, 2028 and an Anticipated Repayment Date of September 6, 2022 (the “ARD”).  Commencing on the ARD, (i) the interest rate will increase as set forth above, (ii) all excess cash flow (net of scheduled debt service, required reserves, approved operating expenses and other items required under the loan documents) will  be swept and applied to the repayment of the outstanding principal balance and the payment of any accrued interest and (iii) the loan will be  prepayable without penalty or premium.  Prior to the ARD, the 1000 Harbor Boulevard Loan is interest-only (requiring monthly interest payments) and  accrues interest at a fixed rate equal to 4.8730%.
 
The 1000 Harbor Boulevard Loan proceeds were used to refinance existing debt of approximately $8.9 million, pay closing costs of approximately $0.6 million, and return equity to the sponsors of approximately $110.3 million.  Based on the appraised value of $187.0 million as of August 1, 2012, the cut-off date LTV is 64.2%.
 
The Borrower / Sponsor. The borrower, 1000 Harbor Boulevard, L.L.C. (the “Borrower”), is a single purpose Delaware limited liability company structured to be bankruptcy-remote, with two independent directors in its organizational structure. The owner of the Borrower is Hartz Mountain Industries, Inc., one of the largest privately held commercial real estate companies in the United States (“Hartz Mountain” or the “Sponsor”).   Hartz Mountain  is a real estate development company and as of December 31, 2011, owned and operated a portfolio of 200 buildings in the New York/Northern New Jersey area and leased more than 38,000,000 sq. ft. of retail, hotel, office, and industrial space.  The non-recourse carve-out guarantor is Hartz Financial Corp.
 
Hartz Mountain’s strategy has been to assemble large tracts of land and comprehensively plan and develop first-class master planned mixed-use developments. The Hartz Mountain portfolio includes as of December 31, 2011 approximately 200 buildings comprised of primarily fully occupied office, retail, and industrial properties and a 300 acre land bank (in a series of Hartz Mountain developed master planned projects) in New Jersey with prime locations in Edison, Ridgefield Park, Jersey City, Kearny, Linden, Hanover, Secaucus, Weehawken and Newark. Historically, Hartz Mountain has owned and managed a diversified real estate portfolio including office buildings, warehouse and distribution facilities, hotels, retail centers, movie theaters, restaurants and some residential developments.  Most of this work has been conducted internally as Hartz Mountain is a full service real estate company with in-house staff and expertise in all disciplines, including leasing, finance, architecture, construction, property management, environmental, tax, accounting and legal.  Development and completion of these master planned developments, especially in high barrier to entry markets in the northeast, can take 10, 20 or often 30 years and requires significant financial reserves.
 
Leonard N. Stern, the Chairman and Chief Executive Officer of Hartz Mountain, began Hartz Mountain’s real estate operations in 1966.  By the late 1980’s, Hartz Mountain’s real estate investments were reportedly worth in excess of $1.0 billion.  As of December 31, 2011, Mr. Stern owned 38 million sq. ft. of commercial, residential and retail property in New Jersey and New York and was ranked #255 of the world’s richest people by Forbes.  Emanuel Stern, Leonard Stern’s son, is the President/Chief Operating Officer of Hartz Mountain. Hartz Financial Corp., the non-recourse care-out guarantor, reports its only asset being a $5.0 million Demand Note given by Hartz Mountain Industries-NJ, LLC per its December 31, 2011 Financial Statements.
 
The Property. The 1000 Harbor Boulevard Property consists of a 10-story, 617,187 sq. ft. office tower constructed in 1989 on a 3.599-acre site within Lincoln Harbor in Weehawken, New Jersey.  Started in the 1980’s, Lincoln Harbor is a master-planned mixed-use development set on 60 acres of waterfront property on the Hudson River, directly opposite Midtown Manhattan, NY.  Upon completion, Lincoln Harbor is expected to include over 3.0 million sq. ft. of corporate office space, 350-room Sheraton Lincoln Harbor Hotel, 70,000 sq. ft. of retail stores and restaurants, 245 waterfront condominiums, The Estuary, a 589 luxury multi-family rental community, a 250-slip marina, extensive enclosed parking and an on-site mass transportation center offering ferry, bus and light rail service. As of December 31, 2011, approximately 1.5 million sq. ft. of office space has been developed and leased.
 
Lincoln Harbor offers views of Midtown Manhattan, shops and restaurants, a public park, yacht club, and waterfront esplanade. It is conveniently adjacent to the entrance of the Lincoln Tunnel, less than 2 miles east of Interstate 95 and minutes from Hoboken.  The 1000 Harbor Boulevard Property is accessed from JFK Boulevard, with Harbor Boulevard being the internal road servicing Lincoln Harbor. The entrance to the Lincoln Tunnel is located across the street from Lincoln Harbor along JFK Boulevard, providing direct access to Manhattan.  Public transportation to the site includes New Jersey Transit bus service, New York Waterway ferry service and the new Hudson-Bergen Light Rail Line, offering light rail service to and from Hoboken, which has created additional direct access from the site to Manhattan via the PATH train, as well as connections to NJ Transit Rail Terminals and buses, connecting riders throughout New Jersey. Additionally, Newark International Airport is less than 10 miles away.
 
Major Tenants. The 1000 Harbor Boulevard Property is fully leased to two tenants, UBS Financial Services, Inc., an affiliate of the loan seller and Hartz Financial Corp., the Sponsor.
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
  
 
4

 
 
1000 Harbor Boulevard
Weehawken, NJ 07086
Collateral Asset Summary
1000 Harbor Boulevard
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$120,000,000
64.2%
1.47x
7.4%
 
UBS Financial Services, Inc. (“UBS”) (589,405 sq. ft., 95.5% of NRA, 95.4% of underwritten occupied base rent): UBS Financial Services, Inc. is the SEC registered broker-dealer subsidiary of UBS Americas, Inc. which provides wealth management, asset management and investment banking services. UBS has been a tenant and partner in the building since 1986 and recently extended the lease term for 15 years, bringing the expiration date to December 2028.  In conjunction with this extension, Hartz bought out UBS’ partnership interest. The partial-interest ownership of UBS in two other buildings, 1200 Harbor Boulevard and 800 Harbor Boulevard, was also purchased by Hartz Mountain as part of the overall transaction.  The value of that interest was factored into the determination of the fixed rent of the lease extension and has resulted in rental rates that are substantially below market.  The initial rent in the extension period is 40% less than the current New Jersey Waterfront market rent of $22 per sq. ft. net.
 
UBS leases 589,405 sq. ft. over a 40-year lease term expiring in December 2028, with two 10-year renewal options.  UBS’s rent of $14.64 per sq. ft. decreases to $13.30 per sq. ft. on January 1, 2014.  The rent increases to $14.05 per sq. ft. on January 1, 2019 and again on January 1, 2024 to $14.80 per sq. ft.  Under the terms of its lease, UBS is responsible for all operating expenses related to its space at 1000 Harbor Boulevard Property, including real estate taxes, insurance and repairs and maintenance.  In addition to the 1000 Harbor Boulevard Property, UBS occupies space in three other buildings in Lincoln Harbor: 800 Harbor Boulevard, 1200 Harbor Boulevard and 1500 Harbor Boulevard.  The leases at 800 Harbor Boulevard and 1500 Harbor Boulevard expire in December 2013 and UBS does not intend to renew those leases.  Employees at 800 Harbor Boulevard and 1500 Harbor Boulevard are expected to be consolidated into the 1000 Harbor Boulevard Property.  UBS will also scale back its space in 1200 Harbor Boulevard from eight floors to three floors effective January 1, 2014.  UBS is rated A/A2/A by S&P/Moody’s/Fitch.
 
Hartz Mountain Industries, Inc. (“Hartz Mountain”) (27,782 sq. ft., 4.5% of NRA, 4.6% of underwritten occupied base rent):  Hartz Mountain, with headquarters in Secaucus, New Jersey, is one of the largest privately held real estate owners/developers in the United States with the majority of its properties located in the Northern New Jersey/New York area. Hartz Mountain is wholly owned by The Hartz Group, Inc., a privately held enterprise with interests in real estate and financial management. Founded in 1966, Hartz Mountain has grown into a large regional real estate enterprise, owning and operating a portfolio of 200 buildings in the New York/Northern New Jersey area, and owning, developing, managing and leasing more than 38 million sq. ft. of retail, hotel, office and industrial properties.  In addition, it owns more than 200 undeveloped acres of land in major areas of northern New Jersey.
 
Hartz Mountain currently leases 27,782 sq. ft. at the 1000 Harbor Boulevard Property, which consists of 100% of the ground level retail space pursuant to a lease that expires July 31, 2022 and has an initial renewal option through December 31, 2028 and two subsequent 10-year renewal options.  Hartz Mountain’s rent of $15.00 per sq. ft. is flat throughout the lease term.  Hartz Mountain subleases the bulk of the retail space to third party tenants Ruth’s Chris Steakhouse and Cue Time Billiards.  The remaining retail space consists of common area and two small units occupied by UBS.
 
The Market. The 1000 Harbor Boulevard Property is located in Lincoln Harbor in Weehawken, Hudson County, New Jersey.  The Northern New Jersey region is comprised of eleven counties: Bergen, Essex, Hudson, Hunterdon, Middlesex, Morris, Passaic, Somerset, Sussex, Union, and Warren. The region extends 45 to 55 miles west of Midtown Manhattan. The northeastern area of the region is heavily urbanized and densely developed, while the remainder is largely suburban and semi-rural. The region encompasses approximately 3,100 square miles, or 41.9% of the land area in New Jersey, which totals approximately 7,400 square miles.  Hudson County is the smallest and most densely populated county, encompassing an area of 46 square miles. Hudson County is bounded by Bergen County to the north and west, Essex and Union Counties to the west, Staten Island, New York to the south, and the Hudson River and Manhattan to the east.
 
The northern and central New Jersey region has an extensive transportation network, and numerous destinations are easily accessible via major highways. Major Interstate highways include I-287 and I-95 (the New Jersey Turnpike), which travel north/south through the state, and I-78, I-80 and I-280, which provide east-west access. U.S. Routes 1, 9, 202 and 206 are heavily traveled highways, which traverse the state north/south, while U.S. Routes 22 and 46 cross the state east/west. Other major routes include state highways 10, 17, 18, 23, and 24, as well as the Garden State Parkway (passenger traffic only).  Hudson County’s population stabilized during the 1980’s after an extended period of decline from 1930 to 1980. During this time period, the county’s population declined by 19.9% from 690,730 persons in 1930 to 553,105 persons in 1990. Hudson County experienced a reversal during the following decade, with a population increase of 10.1% by 2000. This increase can be attributed to the development that has occurred within the waterfront sections of the County, as well as the general shift that has been occurring in many of the state’s urban centers as people return to city living.   The population in Hudson County has been steadily growing since 2000, and this trend is expected to continue through 2016.  Hudson County has witnessed growth trends slightly greater than those witnessed by the overall state and is projected to witness greater growth into the near future.
 
The Northern New Jersey office market contains a total of 96,281,488 sq. ft. within 453 buildings. The availability rate remained relatively flat in the second-quarter 2012, similar to the previous 12 months, reporting at 20.6% as compared to the second quarter 2011 rate of 20.3%. Significant negative absorption was reported for year-end 2011; however the first two quarters of 2012 have been positive. The average asking rent within the submarket was $24.52 per sq. ft. as of the second quarter 2012.
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to  send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
5

 
 
1000 Harbor Boulevard
Weehawken, NJ 07086
Collateral Asset Summary
1000 Harbor Boulevard
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$120,000,000
64.2%
1.47x
7.4%
 
According to a market research report, the Summit Executive Center, at 65,000 sq. ft., is under construction for completion in August 2012, while Two Riverfront Center, at 411,000 sq. ft., is under construction in Newark for an August 2013 opening. Average asking and effective rents rose 0.1% and 0.3%, respectively, in first quarter, to $27.73 per sq. ft. and $23.04 per sq. ft.  Class A rents finished the quarter at $32.68 per sq. ft., while Class B/C rents were $22.57 per sq. ft. Overall, rents were essentially unchanged through May 2012.
 
The 1000 Harbor Boulevard Property is situated in the Waterfront Region submarket of Hudson County, which consists of three primary communities: Hoboken, Weehawken and Jersey City. Bayonne, Guttenberg, North Bergen, Union City and West New York are also communities within the Waterfront Region, although they generally contain limited office space. According to the appraisal, this submarket has an inventory of 18,906,320 sq. ft. with an average effective rent of $31.71 per sq. ft.
 
The Waterfront average asking rent declined by 13.8% since the market peak in 2007, to $28.76, with most of this decline occurring during 2009. The average asking rent has shown a fairly significant increase of 9.6% from the year end rate of $28.93 per sq. ft. to the current rent of $31.71 per sq. ft.  The Waterfront has the second lowest overall vacancy rate of the 19 Northern and Central New Jersey submarkets.
 
The table below shows statistics as of the first quarter of 2012 for Class A and B office space in the market and submarket.
 
Category
New Jersey Northern
Waterfront
Existing Supply (Sq. Ft.)
96,281,488
18,906,320
Average Vacant
20.6%
9.7%
Average Rent Per Sq. Ft.
$24.52
$31.71
Source: Appraisal.
 
The table below shows the vacancy and asking rents at the 1000 Harbor Boulevard Property in comparison to direct competitors in the Waterfront submarket.
 
Summary of Comparable Office Properties(1)
Building
Year Built
Size (Sq. Ft.)
% Leased
Asking Rent (Net) Per Sq. Ft.
Class
1000 Harbor Boulevard
1989
617,187
100.0%
$20.57
A
Exchange Place Centre
1988
698,000
100.0%
$18.00 - $19.00
A
Colgate Center
1992
1,200,000
NAV   
$18.00 - $20.00
A
International Financial Tower
1989
629,922
NAV   
$24.00
A
Waterfront Corporate Center
2003
570,341
NAV   
$24.00
A
Total / Wtd. Avg.
 
3,715,450
NAV   
$18 - $24
 
(1)
     Source: Appraisal.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
6

 
 
1000 Harbor Boulevard
Weehawken, NJ 07086
Collateral Asset Summary
1000 Harbor Boulevard
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$120,000,000
64.2%
1.47x
7.4%
 
Cash Flow Analysis.
 
Cash Flow Analysis
 
 
12/31/2010
12/31/2011
T-12 6/30/2012
U/W
U/W Per Sq. Ft.
 
Base Rent
$12,533,083
$12,533,083
$12,533,088
$12,481,850
$20.22
 
Rent Steps(1)
0
0
0
(3,437,410)
(5.57)
 
Gross Potential Rent
$12,533,083
$12,533,083
$12,533,088
$9,044,440
$14.65
 
Total Recoveries
4,856,719
5,052,288
5,243,739
5,472,067
8.87
 
Less: Vacancy(2)
0
0
0
(310,221)
(2.1%)
 
Total Other Income(3)
0
0
0
144,566
0.23
 
Effective Gross Income
$17,389,803
$17,585,372
$17,776,827
$14,350,852
$23.25
 
Total Operating Expenses
4,874,204
5,136,523
5,041,541
5,472,067
8.87
 
Net Operating Income
$12,515,599
$12,448,849
$12,735,286
$8,878,786
$14.39
 
TI/LC
0
0
0
51,051
0.09
 
Capital Expenditures
0
0
0
117,266
0.19
 
Net Cash Flow
$12,515,599
$12,448,849
$12,735,286
$8,710,469
$14.11
 
(1)
U/W Rent Steps includes a negative straight-line adjustment for UBS due to rent dropping 35% on 1/1/2014.
(2)
U/W Vacancy of 2.0% for office and 5.0% for retail space.
(3)
Total Other Income includes flat annual rent for Generator Space on the grade level of the parking structure. Straight-lined increases, co-terminus with lease.
 
Property Management. The 1000 Harbor Boulevard Property is managed by Hartz Mountain Industries, Inc., an affiliate of the Borrower.
 
Lockbox / Cash Management. The 1000 Harbor Boulevard Loan is structured with a springing hard lockbox and springing cash management. A hard lockbox without active cash management is required to be put into place upon the occurrence of a permitted transfer. A hard lockbox with active cash management is required to be put into place upon the occurrence of any of the following events: (i) an event of default or (ii) the failure by the Borrower to repay or defease the 1000 Harbor Boulevard Loan in full on or prior to the date that is one month before the ARD date.
 
Initial Reserves. None.
 
Ongoing Reserves. None required prior to ARD; thereafter, monthly reserves for the payment of real estate taxes and insurance premium are required.
 
Current Mezzanine or Subordinate Indebtedness. None.
 
Future Mezzanine or Subordinate Indebtedness Permitted. None permitted.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to  send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
7

 
 
1000 Harbor Boulevard
Weehawken, NJ 07086
Collateral Asset Summary
1000 Harbor Boulevard
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$120,000,000
64.2%
1.47x
7.4%

(MAP)
 
 

The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
8

 
 
333 Apache Mall
Rochester, MN 55902
Collateral Asset Summary
Apache Mall
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$99,876,062
66.6%
1.63x
10.4%
 
Mortgage Loan Information
 
Property Information
Loan Seller:
UBSRES
 
Single Asset / Portfolio:
Single Asset
Loan Purpose:
Refinance
 
Property Type:
Retail - Regional Mall
Sponsor:
GGP Limited Partnership
 
Collateral:
Fee Simple / Leasehold
Borrower:
Apache Mall, LLC
 
Location:
Rochester, MN
Original Balance:
$99,999,999
 
Year Built / Renovated:
1969 / 2002
Cut-off Date Balance:
$99,876,062
 
Total Sq. Ft.(3):
591,423
% by Initial UPB:
TBD%
 
Property Management:
Self-managed
Interest Rate:
4.3240%
 
Underwritten NOI:
$10,348,020
Payment Date:
6th of each month
 
Underwritten NCF:
$9,730,957
First Payment Date:
September 6, 2012
 
Appraised Value:
$150,000,000
Maturity Date:
August 6, 2017
 
Appraisal Date:
July 16, 2012
Amortization:
360 months
     
Additional Debt(1):
None
 
Historical NOI
Call Protection:
L(25), D(31), O(4)
 
Most Recent NOI:
$10,692,932 (T-12 May 31, 2012)
Lockbox / Cash Management:
Hard / Springing
 
2nd Most Recent NOI:
$10,929,869 (December 31, 2011)
       
3rd Most Recent NOI:
$11,003,673 (December 31, 2010)
Reserves(2)
     
 
Initial
 
Monthly   
 
Historical Occupancy(4)
Taxes:
$0
 
Springing  
 
Most Recent Occupancy:
96.2% (June 30, 2012)
Insurance:
$0
 
Springing  
 
2nd Most Recent Occupancy:
97.8% (December 31, 2011)
Replacement:
$0
 
Springing  
 
3rd Most Recent Occupancy:
97.3% (December 31, 2010)
TI/LC:
$0
 
Springing  
 
(1)
(2)
(3)
 
(4)
Future mezzanine debt is permitted. See “Future Mezzanine or Subordinate Indebtedness” herein.
See “Initial Reserves” and “Ongoing Reserves” herein.
The Apache Mall Property has a total of 754,213 sq. ft. including Macy’s, which owns its own land and improvements. Cut-Off Date Balance / Sq. Ft. and Balloon Balance / Sq. Ft. are calculated based on the 591,423 sq. ft. of collateral only.
Historical Occupancy shown in the table above is based on historical operating statements and occupancy percentages provided by the Borrower, inclusive of anchor-owned space.
Ground Rent:
$0
 
Springing  
 
         
Financial Information
 
Cut-off Date Balance / Sq. Ft.(3):
 
$169
   
Balloon Balance / Sq. Ft.(3):
 
$154
   
Cut-off Date LTV:
 
66.6%
   
Balloon LTV:
 
60.8%
   
Underwritten NOI DSCR:
 
1.74x
   
Underwritten NCF DSCR:
 
1.63x
   
Underwritten NOI Debt Yield:
 
10.4%
   
Underwritten NCF Debt Yield:
 
9.7%
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
9

 
 
333 Apache Mall
Rochester, MN 55902
Collateral Asset Summary
Apache Mall
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$99,876,062
66.6%
1.63x
10.4%
 
Anchor and Major Tenant Summary
   
Ratings (Fitch/Moody’s/S&P)(1)
 
Net
Rentable Area
(Sq. Ft.)
 
% of 
Net
Rentable
Area(2)
 
U/W
Annual
Base Rent
Per Sq.
Ft.(3)
 
% of
Owned
U/W Base
Rent(3)(4)
 
Lease 
Expiration
 
T-12
4/30/2012
Total
Sales
(000s)
 
Sales
Per
Sq.
Ft.(5)
 
Occupancy
Cost 
(% of
Sales)(5)(6)
  Non-Collateral Anchor Tenants
                                   
  Macy’s(7)
 
BBB/Baa3/BBB
 
162,790
 
21.6
 
NAP
 
NAP
   
NAP
 
NAP
 
NAP
 
NAP
  Subtotal
     
162,790
 
21.6
               
NAP
 
NAP
   
                                         
  Anchor Tenants
                                       
  JCPenney
 
BB-/Ba3/B+
 
128,196
 
17.0
%  
$3.14
 
4.1
 
10/31/2014
 
$22,868
 
$178
 
2.6%
  Sears
 
CCC/B3/CCC+
 
113,876
 
15.1
   
$3.50
 
4.0
   
2/28/2014
 
$10,516
 
$92
 
5.5%
  Herberger’s
 
B-/Caa3/CCC
 
78,130
 
10.4
   
$4.53
 
3.6
   
1/31/2018
 
$13,384
 
$171
 
3.9%
  Subtotal/Wtd. Avg.
     
320,202
 
42.5
%  
$3.61
 
11.6
     
$46,768
 
$146
 
3.6%
                                         
  Major In-Line
  Tenants
                                       
  Barnes & Noble
 
NR/NR/NR
 
25,134
 
3.3
 
$17.90
 
4.5
 
1/31/2013
 
$6,065
 
$241
 
7.5%
  Forever 21(8)
 
NR/NR/NR
 
12,686
 
1.7
   
$33.50
 
4.3
   
8/31/2022
 
NAV
 
NAV
 
NAV
  Gap/Gap Kids
 
BBB-/Baa3/BB+
 
10,568
 
1.4
   
$26.17
 
2.8
   
1/31/2016
 
$2,337
 
$221
 
13.3%
  Express
 
NR/NR/BB
 
10,028
 
1.3
   
$21.49
 
2.2
   
1/31/2014
 
$2,693
 
$269
 
9.9%
  Subtotal/Wtd. Avg.
     
58,416
 
7.7
%  
$23.40
 
13.8
     
$11,095
 
$243
 
9.3%
                                         
  Other(9) 
 
Various
 
208,156
 
27.6
 
$35.63
 
74.6
%  
Various
 
$69,360
 
$394
 
15.4%
  Vacant
 
NAP
 
4,649
 
0.6
   
NAP
 
NAP
   
NAP
 
NAP
 
NAP
 
NAP
  Total/Wtd. Avg. (10)
     
754,213
 
100.0
%  
$16.94
 
100.0
 %      
 NAP
 
NAP
 
NAP
(1) 
Certain ratings are those of the parent company whether or not the parent company guarantees the lease.
(2) 
% of Net Rentable Area is based on total mall sq. ft. of 754,213, inclusive of non-owned anchor tenants.
(3) 
U/W Annual Base Rent Per Sq. Ft. and % of Owned U/W Base Rent include contractual rent steps through July 31, 2013 as well as percentage in lieu rent that was calculated based on T-12 4/30/2012 Total Sales.
(4) 
% of Owned U/W Base Rent is based on total occupied underwritten base rent and excludes any gross up of vacant space.
(5) 
Sales Per Sq. Ft. and Occupancy Cost (% of Sales) are based on T-12 4/30/2012 Total Sales figures.
(6) 
Occupancy Cost (% of Sales) is calculated as the sum of (i) underwritten base rent, inclusive of percentage in lieu rent that was calculated based on T-12 4/30/2012 Total Sales and contractual rent steps through July 31, 2013 and (ii) the tenant-by-tenant expense recoveries per the rent roll dated June 30, 2012, all divided by the T-12 4/30/2012 Total Sales.
(7) 
Macy’s is not required to report sales.
(8) 
Forever 21 is not yet in occupancy.  In the event the Borrower does not deliver occupancy to this tenant by January 1, 2013, the tenant is permitted to terminate its lease.
(9) 
Other Tenant Sales Per Sq. Ft. and Occupancy Cost (% of Sales) include only tenants less than or equal to 10,000 sq. ft. that reported both T-12 4/30/2012 Total Sales and 2011 sales (excluding kiosk, ATM and other non-mall-shop tenants).
(10)
Weighted Average U/W Annual Base Rent Per Sq. Ft. is based on total occupied collateral sq. ft. of 586,774 and excludes any gross up of vacant space.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
10

 
 
333 Apache Mall
Rochester, MN 55902
Collateral Asset Summary
Apache Mall
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$99,876,062
66.6%
1.63x
10.4%
 
Lease Rollover Schedule
  Year
# of
Leases
Expiring
Total
Expiring
Sq. Ft.
% of Total Sq.
Ft. Expiring
Cumulative
Sq. Ft. Expiring
Cumulative % of
Sq. Ft. Expiring
Annual U/W
Base Rent Per
Sq. Ft.(1)(2)
% U/W
Base Rent
Rolling(1)(2)
Cumulative %
of U/W Base
Rent(1)(2)
  MTM
11
17,819
3.0%
17,819
3.0%
$32.95
6.3%
6.3%
  2012
0
0
0.0
17,819
3.0%
$0.00
0.0
6.3%
  2013
9
38,734
6.5
56,553
9.6%
$26.35
10.9
17.2%
  2014
16
304,834
51.5
361,387
61.1%
$6.31
20.6
37.8%
  2015
13
27,798
4.7
389,185
65.8%
$33.44
10.0
47.8%
  2016
6
25,398
4.3
414,583
70.1%
$35.36
9.6
57.4%
  2017
13
31,208
5.3
445,791
75.4%
$36.55
12.2
69.6%
  2018
5
91,564
15.5
537,355
90.9%
$9.85
9.7
79.3%
  2019
3
6,490
1.1
543,845
92.0%
$31.52
2.2
81.5%
  2020
4
8,170
1.4
552,015
93.3%
$47.96
4.2
85.7%
  2021
3
16,106
2.7
568,121
96.1%
$34.18
5.9
91.6%
  2022
2
13,833
2.3
581,954
98.4%
$35.29
5.2
96.8%
  Thereafter
2
4,820
0.8
586,774
99.2%
$62.03
3.2
100.0%
  Vacant
NAP
4,649
0.8
591,423
100.0%
NAP
NAP
 
  Total / Wtd. Avg.
87
591,423
100.0%
   
$15.91
100.0%
 
(1)  
Annual U/W Base Rent Per Sq. Ft., % U/W Base Rent Rolling and Cumulative % of U/W Base Rent include contractual rent steps through July 31, 2013.
(2)  
Annual U/W Base Rent Per Sq. Ft., % U/W Base Rent Rolling and Cumulative % of U/W Base Rent are based on the underwritten occupied base rent and underwritten occupied sq. ft., and exclude any gross up of vacant space.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
11

 
 
333 Apache Mall
Rochester, MN 55902
Collateral Asset Summary
Apache Mall
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$99,876,062
66.6%
1.63x
10.4%
 
The Loan.    The Apache Mall loan (the “Apache Mall Loan”) is a $99,999,999 ($169 per sq. ft. of owned collateral), fixed rate loan secured by the borrower’s fee simple and leasehold interest in 591,423 sq. ft. (the “Apache Mall Collateral”) of a 754,213 sq. ft. regional mall located at 333 Apache Mall in Rochester, Minnesota (the “Apache Mall Property”). The Apache Mall Collateral includes JCPenny, Sears, Herberger’s, Barnes & Noble, Forever 21, Gap/Gap Kids, Express and all other mall shop space. The Apache Mall Collateral does not include anchor Macy’s. The $99,999,999 first mortgage loan has a five-year term.  The Apache Mall Loan accrues interest at a fixed rate equal to 4.3240% and amortizes on a 30-year schedule.
 
The Apache Mall Loan proceeds were used to pay closing costs of approximately $599,526 and return equity to the Sponsor of approximately $7.7 million beyond the Sponsor’s initial cost basis of approximately $93.1 million (comprising purchase price of $81.1 million and renovation costs of $12.0 million).  No existing debt was in place on the Apache Mall Collateral prior to the closing of the Apache Mall Loan.  Based on the appraised value of $150.0 million as of July 16, 2012, the cut-off date LTV is 66.6%.
 
The Borrower / Sponsor.    The borrower, Apache Mall, LLC (the “Borrower”), is a single purpose Delaware limited liability company structured to be bankruptcy-remote with at least two independent directors in its organizational structure.  The Borrower is owned and controlled, directly or indirectly, by GGP Limited Partnership, the non-recourse carveout guarantor.  The sponsor of the Borrower is GGP Limited Partnership (Sponsor).  The Sponsor’s parent, General Growth Properties, Inc. (“GGP”) is one of the largest owners and operators of regional malls in the nation with an ownership interest in 136 regional malls in 41 states as of December 31, 2011, comprising 58 million sq. ft. of gross leasable area (“GLA”), excluding anchor tenants.  Based on the number of regional malls in the portfolio and total GLA, GGP is the second largest owner of regional malls in the United States. Of the 136 regional malls, 78 are considered Class A regional malls and have average tenant sales exceeding $575 per sq. ft.  GGP has an interest in 125 of the 600 regional malls in the United States with the highest sales per sq. ft. Together, these regional malls had 2011 average tenant sales per sq. ft. of $505.
 
The Property.   The Apache Mall Property consists of an enclosed, single-level regional mall located at 333 Apache Mall approximately two miles from downtown Rochester, Minnesota, which is approximately 75 miles southeast of Minneapolis, Minnesota.  Anchors at the Apache Mall Property include Macy’s (anchor-owned and not part of the collateral), JCPenney, Sears, and Herberger’s.  Mall shop space consists of approximately 80 stores totaling 201,857 sq. ft. inclusive of the food court and kiosks.  The Apache Mall Collateral was 96.2% occupied as of the rent roll dated June 30, 2012 and the Apache Mall Property was 99.4% occupied as of the same date.  The Apache Mall Collateral includes unimproved land used for 99 additional parking spaces and the storage of snow removal equipment. The land is owned by the State of Minnesota Department of Transportation and ground leased by the Borrower. The ground lease does not contain typical mortgagee protections or otherwise satisfy rating agency criteria for ground leases. The ground leased parcel is not material to the operation of the Apache Mall Collateral.
 
The Apache Mall Property opened in 1969 and has undergone numerous expansions and renovations. Significant additions include the Macy’s pad in 1972, a Sears and a food court with seating for 300 in 1992, and a 25,134 sq. ft. Barnes & Noble and a food court expansion with seating for more than 600 in 2002.
 
The Apache Mall Property is located at the intersection of Route 14 and Highway 52, which is a local north/south arterial that provides direct access to the “Twin Cities” of Minneapolis and Saint Paul.  Regional access is provided by Interstate 90, which is approximately 13 miles southeast of the Apache Mall Property.  The Apache Mall Property is located in Olmsted County, within the greater Northwestern Rochester area. Rochester is the State’s third largest city and is located approximately 75 miles southeast of the Twin Cities and is frequently ranked among the top ten livable cities in the United States.  Rochester is home to the Mayo Clinic, which is located approximately two miles north of the Apache Mall Property and forms the core of Rochester’s economy. The Mayo Clinic employs over 30,000 people in the city and every year draws over 2 million visitors.  The clinic’s many facilities, along with hotels, restaurants and retail stores, comprise nearly the entire downtown of Rochester. Excluding the state government, the Mayo Clinic is the largest employer in Minnesota. In addition, IBM’s Rochester campus is the world’s largest IBM facility.  According to the appraisal, the Apache Mall Property’s trade area includes 180,422 people (within a 20 mile radius as of 2012) with an average household income of $75,857.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
12

 
 
333 Apache Mall
Rochester, MN 55902
Collateral Asset Summary
Apache Mall
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$99,876,062
66.6%
1.63x
10.4%
 
The chart below details the Apache Mall Property’s tenancy by general type.

Apache Mall Tenant Type Summary
Tenant Type
 
Net Rentable
Area (Sq. Ft.)
 
% of 
Net Rentable
Area
 
U/W Annual
Base Rent
Per Sq. Ft.(1)
 
% of Total U/W
Base Rent(1)(2)
 
Average
Remaining
Lease Term
(Yrs)
 
T-12
4/30/2012
Sales
 Per Sq. Ft.
 
Occupancy
Cost %(3)
Anchor Tenants (non-collateral)
 
162,790
   
NAP
   
NAPP
   
NAP
   
NAP
   
NAP
   
NAP
 
                                           
Anchor Tenants (collateral)
 
320,202
   
54.1
%  
$3.61
   
11.6
 
2.9
   
$146
   
2.9%
 
Major In-Line > 10,000
 
58,416
   
9.9
   
$23.40
   
13.8
   
3.4
   
$243
   
8.5%
 
In-Line <10,000
 
192,269
   
32.5
   
$34.06
   
65.9
   
3.5
   
$386
   
11.7%
 
Food Court
 
4,781
   
0.8
   
$102.15
   
4.9
   
5.1
   
$678
   
23.0%
 
Kiosk / Other
 
11,106
   
1.9
   
$34.32
   
3.8
   
7.5
   
$1,602
   
17.6%
 
Vacant
 
4,649
   
0.8
   
NAP
   
NAP
   
NAP
   
NAP
   
NAP
 
Total / Wtd. Avg.(4)(5)
 
591,423
   
100.0
 
$16.94
   
100.0
                 
(1)  
U/W Annual Base Rent Per Sq. Ft. and % of Total U/W Base Rent include contractual rent steps through July 31, 2013 and percentage in lieu rent that was calculated based on T-12 4/30/2012 Total Sales.
(2)  
% of Total U/W Base Rent is based on the underwritten occupied base rent and underwritten occupied sq. ft., and excludes any gross up of vacant space.
(3)  
Occupancy Cost % is calculated as the sum of (i) underwritten base rent, inclusive of percentage in lieu rent that was calculated based on T-12 4/30/2012 Total Sales and contractual rent steps through July 31, 2013 and (ii) the tenant-by-tenant expense recoveries per the rent roll dated June 30, 2012 but excluding tenant energy costs, all divided by the T-12 4/30/2012 Total Sales.
(4)  
Total U/W Annual Base Rent Per Sq. Ft. is based on the underwritten occupied base rent and underwritten occupied sq. ft., and excludes any gross up of vacant space.
(5)  
Total Net Rentable Area (Sq. Ft.) excludes non-collateral tenants.
 
The Market.    The Apache Mall Property is located in Rochester, Minnesota, within close proximity to Interstate 90 on Highway 52, approximately two miles south of the Rochester Central Business District.  The Apache Mall Property is considered a suburban location and is located approximately 75 miles southeast of Minneapolis.  Primary access is provided by Highway 52, Highway 14 and Interstate 90.  Highway 14 runs in an east/west direction, while Highway 52 intersects Interstate 92 and runs generally north/south through Rochester.
 
The area surrounding the Apache Mall Property consists of primarily commercial development along Highway 14. Gas stations, convenience stores and automotive uses are prevalent in the immediate area due to the accessibility of U.S. Highway 52. The remainder of the uses surrounding the Apache Mall Property are predominantly commercial with some industrial uses scattered throughout the area.  The Apache Mall Property is the primary shopping destination for southeastern Minnesota’s residents, with the trade area extending into northern Iowa and western Wisconsin.  Due to the lack of malls within the vicinity, the Apache Mall Property’s only immediate competition is discount retailers such as Walmart and Target and several power centers.
 
The Apache Mall Property is located in southeastern Minnesota in the Rochester Core Based Statistical Area (CBSA), which had a 2012 estimated population of approximately 189,536 residents. Between 2000 and 2012, the CBSA population expanded annually by 1.23% compared to 0.74% for the entire state over the same period.  According to the appraisal, population growth in the CBSA is projected to increase 1.01% annually through 2017.  The Apache Mall Property’s trade area within a 10- and 20-mile radius also experienced positive annual population growth over the period 2000-2012 at 1.46% and 1.36%, respectively. Through 2017, the populations within 10- and 20-mile radii are expected to continue to grow at 1.12%, and 1.08%, respectively.
 
Average household income for 2012 in the 10- and 20-mile radii equaled $79,101 and $75,857, respectively, compared to the Minnesota average of $70,291.  From 2000 to 2012, average household income within the same radii increased annually by 1.69% and 1.62%, respectively.  In the Apache Mall Property’s 10-mile radius, approximately 23% of the population has an average household income of $100,000 or more.
 
The Apache Mall Property is the only enclosed regional mall within 72 miles and as such is the first choice for many national retailers entering the Rochester market.
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
13

 
 
333 Apache Mall
Rochester, MN 55902
Collateral Asset Summary
Apache Mall
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$99,876,062
66.6%
1.63x
10.4%
 
The chart below details the Apache Mall Property’s competitive set.
 
 
   Property
Year Built /
Renovated
Total GLA
Anchor Tenants
Occupancy %(2)
Proximity
(miles
)
   Apache Mall Property
1969 / 2002
754,213
Macy’s
JC Penney
Sears
96.2%
Subject
   Valley View Mall
1980 / 2001
625,000
Herberger’s
JC Penney
 Macy’s
96.0%
72.0
   Mall of America
1992 / 2005
2,770,000
Bloomingdale’s
Macy’s
Nordstrom
95.0%
75.0
   Burnsville Center
1977 / 2001
1,100,000
Dick’s Sporting Goods
JC Penney
Macys
96.0%
75.0
(1)  
Source: Appraisal.
(2)  
Based on total mall GLA including any non-owned anchors.
 
The Apache Mall Property is a traditional shopping center with a wide mix of tenants. The potential trade area for the Apache Mall Property is defined by the location and drawing power of surrounding regional retail centers.  The nearest competitive malls to the Apache Mall Property are Valley View Mall, which is located 72 miles southeast of the Apache Mall Property, and Mall of America and Burnsville Center, which are located 75 miles northwest.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
14

 
 
333 Apache Mall
Rochester, MN 55902
Collateral Asset Summary
Apache Mall
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$99,876,062
66.6%
1.63x
10.4%
 
Cash Flow Analysis.
 
Cash Flow Analysis
 
12/31/2010
12/31/2011
T-12 5/31/2012
U/W
U/W Per Sq. Ft.(1)    
  Base Rent(2)
$8,347,883
$8,428,311
$8,372,471
$8,605,422
$14.55  
  Value of Vacant Space(3)
0
0
0
792,121
1.34  
  Rent Steps(4)
0
0
0
141,975
0.24  
  Percentage Rent(5)
469,562
503,271
514,256
605,612
1.02  
  Gross Potential Rent
$8,817,445
$8,931,582
$8,886,727
$10,145,129
$17.15  
  Total Recoveries
6,249,201
6,021,535
6,006,053
5,627,492
9.52  
  Total Other Income(6)
1,585,733
1,690,766
1,531,515
1,531,515
2.59 
  Less: Vacancy
21,456
13,241
11,386
(792,121)
(5.0%) 
  Effective Gross Income
$16,673,835
$16,657,124
$16,435,681
$16,512,015
$27.92 
  Total Operating Expenses
5,670,161
5,727,254
5,742,749
6,163,995
10.42 
  Net Operating Income
$11,003,673
$10,929,869
$10,692,932
$10,348,020
$17.50 
  TI/LC
0
0
0
451,465
0.76 
  Capital Expenditures
0
0
0
165,598
0.28 
  Net Cash Flow
$11,003,673
$10,929,869
$10,692,932
$9,730,956
$16.45 
(1)  
U/W Per Sq. Ft. based on total collateral sq. ft. of 591,423.
(2)  
U/W Base Rent is based on the rent roll dated June 30, 2012.
(3)  
U/W Value of Vacant Space is based on the vacant sq. ft. as of the Rent Roll dated June 30, 2012 grossed up at the appraiser’s market rent conclusion for each respective space type.
(4)  
U/W Rent Steps includes contractual rent increases through July 31, 2013.
(5)  
UW Percentage Rent is based on breakpoints and % per the Rent Roll dated June 30, 2012 and T-12 4/30/2012 Total Sales.
(6)  
Other rental income is based on T-12 April 30, 2012 and contains UW Non-Rental Income is based on T-12 April 30, 2012.
 
Anchor Tenants Historical Sales Per Sq. Ft.(1)
Tenant
2010
2011
T-12
4/30/2012
JCPenney
$172
$178
$178
Sears
$102
$92
$92
Herberger’s
$174
$173
$171
(1)     Based on historical sales statements provided by the Borrower.
 
Property Management. The Apache Mall Property is self-managed.
 
Lockbox / Cash Management. The Apache Mall Loan is structured with a hard lockbox and springing cash management.  Active cash management is triggered upon the DSCR falling below 1.20x (a “Low DSCR Trigger Event”).  All excess cash will be swept into a lender controlled account upon the occurrence of one of the following events: (i) an event of default by the Borrower or (ii) certain bankruptcy events relating to the Borrower, the Sponsor or property manager (a “Cash Sweep Event”).
 
Initial Reserves. None.
 
Ongoing Reserves. During the continuation of a Low DSCR Trigger Event or a Cash Sweep Event, the Apache Mall Loan documents require monthly escrows to be deposited in the amount of (i) $179,216 into a tax reserve account, (ii) $6,034 into an insurance reserve account, (iii) $13,799 into a capital expenditure/replacement reserve account, (iv) $22,602 into a TI/LC reserve account and (v) 1/12th of the annual ground rent into a ground rent reserve account.
 
Current Mezzanine or Subordinate Indebtedness. None.
 
Future Mezzanine or Subordinate Indebtedness Permitted. The Apache Mall Loan documents permit future mezzanine debt subject to the satisfaction of certain conditions including, among other things (i) the LTV on the combined indebtedness is not greater than 66.7%, (ii) the DSCR on the combined indebtedness is at least 1.65x.
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
15

 
 
333 Apache Mall
Rochester, MN 55902
Collateral Asset Summary
Apache Mall
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$99,876,062
66.6%
1.63x
10.4%
 
(MAP)
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
16

 
 
6500 Reisterstown Road
Baltimore, MD 21215
Collateral Asset Summary
Reisterstown Road Plaza
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$46,250,000
58.5%
1.47x
11.7%
 
Mortgage Loan Information   Property Information
Loan Seller:
KeyBank National Association
   
Single Asset / Portfolio:
Single Asset
Loan Purpose:
Refinance
       
Property Type:
Mixed Use – Retail / Office
Sponsor:
Retail Properties of America, Inc.
   
Collateral:
Fee Simple
Borrower:
Inland Reisterstown SPE I, L.L.C. and
   
Location:
Baltimore, MD
 
Inland Reisterstown SPE II, L.L.C.
   
Year Built / Renovated:
1961 / 2004
Original Balance:
$46,250,000
     
Total Sq. Ft.:
798,697
Cut-off Date Balance:
$46,250,000
     
Total Collateral Sq. Ft.(5):
660,408
% by Initial UPB:
TBD%
     
Property Management:
RPAI US Management LLC
Interest Rate:
5.2500%
     
Underwritten NOI:
$5,412,450
Payment Date:
1st of each month
     
Underwritten NCF:
$4,496,073
First Payment Date:
August 1, 2012
     
Appraised Value:
$79,000,000
Maturity Date:
June 1, 2022
     
Appraisal Date:
May 24, 2012
Amortization:
Interest only for 60 months;
           
 
360 months thereafter
     
Historical NOI
Additional Debt:
None
     
 Most Recent NOI:
$4,950,925 (T-12 March 31, 2012)
Call Protection:
L(25), YM1%(91), O(3)
     
 2nd Most Recent NOI:
$4,950,727 (December 31, 2011)
Lockbox / Cash Management:
Hard / Springing
     
 3rd Most Recent NOI:
$5,036,489 (December 31, 2010)
               
Reserves(1)  
Historical Occupancy(6)
 
Initial
 
Monthly
   
 Most Recent Occupancy:
93.1% (June 6, 2012)
Taxes:
$0
 
Springing  
   
 2nd Most Recent Occupancy:
93.7% (December 31, 2011)
Insurance:
$0
 
Springing  
   
 3rd Most Recent Occupancy:
84.1% (December 31, 2010)
Replacement:
$0
 
$0  
   
 4th Most Recent Occupancy:
82.3% (December 31, 2009)
Rollover Reserve:
$0
 
Springing  
   
(1)   See “Initial Reserves” and “Ongoing Reserves” herein.
(2)   Based on collateral sq. ft. of 660,408.
(3)   As of the cut-off date, and during the initial interest only period, the Underwritten  NOI DSCR is 2.20x.
(4)   As of the cut-off date, and during the initial interest only period, the Underwritten  NCF DSCR is 1.83x.
(5)   Excludes the Home Depot and five smaller pad sites, all of which comprise the Borrower’s leased fee interests in the relative parcels.
(6)   Based upon Total Sq. Ft. of 798,697. Prior to renovation in 2011, which included a complete retrofit of the Shopper’s World and Big Lot’s spaces, the subject had a Total Sq. Ft. of 796,799.
State Rollover Reserve:
$400,000
 
Springing  
   
CAM Holdback Reserve:
$608,000
 
$0  
   
Rent Holdback Reserve:
$93,400
 
$0  
   
Dept. of Public Safety
         
Rollover Reserve:
$0
 
Springing  
   
Home Depot Reserve:
$0
 
Springing  
   
           
Financial Information  
Cut-off Date Balance / Sq. Ft. (2):
 
 
$70     
   
Balloon Balance / Sq. Ft.(2):
   
$65     
   
Cut-off Date LTV:
   
58.5%     
   
Balloon LTV:
   
54.3%     
   
Underwritten NOI DSCR(3):
   
1.77x     
   
Underwritten NCF DSCR(4):
   
1.47x     
   
Underwritten NOI Debt Yield:
   
11.7%     
   
Underwritten NCF Debt Yield:
   
9.7%     
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov.  Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
17

 
 
6500 Reisterstown Road
Baltimore, MD 21215
Collateral Asset Summary
Reisterstown Road Plaza
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$46,250,000
58.5%
1.47x
11.7%
 
Tenant Summary
Leased Fee Tenants
(Non-Collateral)
Ratings 
(Fitch/Moody’s/S&P)(1)
Total
Sq. Ft.
% of 
Sq. Ft.
 
U/W Annual
Base Rent
Per Sq. Ft.(2)
% of Annual
U/W Base
Rent(3)
Lease 
Expiration
2011 Total
Sales (000s)
Sales
Per Sq. Ft. (4)
Occupancy
Cost 
(% of Sales)
Home Depot(5)
A-/A3/A-
115,289
14.4%
  $5.20
 7.3%  
1/31/2033
     NAV
NAV
NAV
Other (5 pads)(6)
Various
23,000
2.9 
$20.14
 5.6
Various
     NAV
NAV
NAV
Subtotal
 
138,289
17.3%
  $7.69
  12.9%
       
                   
Retail Anchor Tenants
                 
Burlington Coat Factory
NR/Caa1/B-
60,000
7.5%
  $4.75
    3.4%
1/31/2017
  $5,068
  $84
10.1%
Giant Foods
NR/NR/NR
59,064
7.4 
$17.50
12.5 
7/31/2029
$29,325
$496
4.3%
Shopper’s World(7)
NR/NR/NR
53,040
6.6 
  $7.85
5.0
1/31/2022
     NAV
NAV
NAV
Big Lots(8)
NR/NR/BBB
38,089
4.8 
  $7.35
 3.4
1/31/2022
     NAV
NAV
NAV
Marshalls
NR/A3/A
28,500
3.6 
$10.00
 3.4
4/30/2016
  $5,802
$204 
8.0%
Subtotal
 
238,693
29.9%
  $9.64
  27.8%
 
      NAP
NAP
NAP
                   
Retail Other (49 tenants)
Various
138,134
17.3%
$16.06
   26.8% 
Various
$11,084
$158
15.7%
Retail Vacant
NAP
45,075
  5.6 
    NAP
      NAP 
NAP
      NAP
NAP
NAP
Retail Total/Wtd. Avg.(9)
 
560,191
70.1%
$11.99
  67.5%
 
      NAP
NAP
NAP
                   
Major Office Tenants
                 
Department of Public Safety(10)(11)
AAA/Aaa/AAA
130,766
16.4%
$11.04
  17.5%
12/31/2021
     NAP
NAP
NAP
Department of Mental Health(10)(12)
AAA/Aaa/AAA
23,250
2.9 
$12.50
 3.5
10/31/2012
     NAP
NAP
NAP
Board of Nursing(10)(12)
AAA/Aaa/AAA
15,232
1.9 
$12.95
 2.4
9/30/2020
     NAP
NAP
NAP
Baltimore City Community College(10)(13)
AAA/Aaa/AAA
15,186
1.9 
$12.50
 2.3
6/30/2022
     NAP
NAP
NAP
Social Security Administration(14)
AAA/Aaa/AA+
14,885
1.9 
$12.00
 2.2
7/1/2013
     NAP
NAP
NAP
Subtotal
 
199,319
25.0%
$11.54
27.8 
 
     NAP
NAP
NAP
                   
Office Other
Various
29,396
3.7%
$13.32
    4.7%
Various
     NAP
NAP
NAP
Office Vacant
NAP
9,791
1.2
    NAP
      NAP
NAP
     NAP
NAP
NAP
Office Total/Wtd. Avg.(9)
 
238,506
29.9%
$11.77
  32.5%
 
     NAP
NAP
NAP
                   
Total/Wtd. Avg.
 
798,697
100.0%
$11.91
100.0%
       
(1)
Certain ratings are those of the parent company whether or not the parent company guarantees the lease.
(2)
U/W Annual Base Rent Per Sq. Ft. does not include contractual rent steps.
(3)
Percentage of Owned U/W Base Rent is based on total occupied underwritten base rent of $8,272,892, which does not include contractual rent steps.
(4)
Sales Per Sq. Ft. are based on YE 2011 sales figures.  Retail Other tenant figures include comparable tenants < 10,000 sq. ft.
(5)
Tenant has the option to adjust the base rent to $1 per year with a lump sum payment of $6.5 million (“Adjusted Payment”). If tenant exercises such option, the Adjusted Payment shall be held as additional collateral for the loan until the loan is repaid in full.
(6)
Other leased fee tenants include Kentucky Fried Chicken, Applebee’s, Wendy’s, Checker’s and Panda Express.
(7)
Shopper’s World has not provided a full year of sales information.  If during the 37th-48th month of the lease, tenant’s gross sales do not equal or exceed $4.5 million ($85 per sq. ft.), or if during the 61st-72nd month of the lease tenant’s gross sales do not equal or exceed $5 million ($94 per sq. ft.), then tenant shall have a one-time right to terminate the lease, by delivering notice to landlord 60 days following the end of the applicable measuring period during which sales thresholds were not met.  Termination will be effective on the date that is 180 days following the end of the measurement period.  The earliest date tenant could terminate lease is 1/27/2016.
(8)
Big Lots has not provided a full year of sales information.  If tenant’s gross sales during the period from 2/1/2017 through 1/31/2018 do not exceed $4.75MM ($125/sf), the tenant may terminate the lease by delivering notice no later than 4/30/2018.  The lease shall terminate six (6) months from the date of notice.
(9)
Weighted average U/W Annual Base Rent Per Sq. Ft. is based on total occupied sq. ft. and does not include ground lease tenants.
(10)
Leases are executed by the State of Maryland.
(11)
The lease allows the State of Maryland to cancel the lease for any reason after the third lease year with 12 months notice.  If cancellation notice is given, lender will require monthly escrow of $108,334/month during the 12 month notice period.  At termination lender will have collected $1,300,000 ($10 per sq. ft.).
(12)
The lease allows the State of Maryland to terminate the lease at any time.
(13)
The lease allows the State of Maryland to cancel the lease for any reason after the 36th month of the lease term, with 12 months prior written notice.
(14)
The lease allows the United States government to terminate the lease at any time.
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov.  Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
18

 

6500 Reisterstown Road
Baltimore, MD 21215
Collateral Asset Summary
Reisterstown Road Plaza
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$46,250,000
58.5%
1.47x
11.7%
 
Lease Rollover Schedule
 Year
# of
Leases
Expiring
Total
Expiring
Sq. Ft.
% of Total Sq.
Ft. Expiring
Cumulative
Sq. Ft.
Expiring
Cumulative % of
Sq. Ft. Expiring
Annual U/W
Base Rent
Per Sq. Ft. 
% U/W
Base Rent
Rolling
Cumulative %
of U/W
Base Rent 
 2012 & MTM
18
57,959
     8.8%
  57,959
  8.8%
$14.46
  11.6%
11.6%
 2013
17
48,549
 7.4
106,508
16.1%
$15.25
10.3
21.9%
 2014
7
38,364
 5.8
144,872
21.9%
$14.69
  7.8
29.7%
 2015
5
18,272
 2.8
163,144
24.7%
$16.65
  4.2
33.9%
 2016
2
29,550
 4.5
192,694
29.2%
$10.43
  4.3
38.2%
 2017
5
75,283
11.4
267,977
40.6%
  $8.16
  8.5
46.7%
 2018
2
  8,104
 1.2
276,081
41.8%
$18.98
  2.1
48.9%
 2019
0
         0
 0.0
276,081
41.8%
  $0.00
  0.0
48.9%
 2020
1
15,232
 2.3
291,313
44.1%
$12.95
  2.7
51.6%
 2021
2
148,850  
22.5
440,163
66.7%
$10.55
21.8
73.4%
 2022
3
106,315  
  16.1 
546,478
82.7%
  $8.34
12.3
85.7%
 Thereafter
1
59,064
  8.9
605,542
91.7%
$17.50
14.3
100.0%   
 Vacant
NAP
54,866
  8.3
660,408
100.0%   
    NAP
NAP
 
 Total / Wtd. Avg.
63
660,408  
 100.0%
   
   $11.91
100.0%
 
 
The Loan.    The Reisterstown Road Plaza loan (the “Reisterstown Road Plaza Loan”) is a $46.25 million ($70 per collateral sq. ft.) fixed rate loan with a Maryland indemnity deed of trust structure.  Pursuant to a payment guaranty, the Reisterstown Road Plaza Loan is guaranteed by the owners of the 660,408, excluding the leased fee properties, Sq. Ft. retail and office plaza located in Baltimore, Maryland (the “Reisterstown Road Plaza Property”).  The payment guaranty is secured by the owners’ fee simple interest in the Reisterstown Road Plaza Property.  The $46.25 million first mortgage loan has a term of 119 months, an initial interest only period of 60 months and amortizes on a 30-year schedule. The Reisterstown Road Plaza Loan accrues interest at a fixed rate equal to 5.2500%.  Loan proceeds were used to recapitalize a portion of a principal payment to the Sponsor’s unsecured line of credit, fund upfront reserves totaling $1.10 million, and pay closing costs and fees of $124,438. The Borrower acquired the ownership interest in the Reisterstown Road Plaza Property in 2004 for a reported total cost of $97.49 million ($147.62 per collateral sq. ft.).  Based on the “as-is” appraised value of $79 million as of May 24, 2012, the cut-off date LTV is 58.5%.
 
The Borrower / Sponsors.    The borrowers for the Reisterstown Road Plaza Loan, Inland Reisterstown SPE I, L.L.C. and Inland Reisterstown SPE II, L.L.C. (individually and collectively, the “Borrower”), are each single purpose limited liability companies structured to be bankruptcy remote, with two independent directors in each such entity’s organizational structure.  The owners of the Reisterstown Road Plaza Property, Reisterstown Plaza Associates, LLC, a Maryland limited liability company, and RRP Hecht, LLC, a Maryland limited liability company (individually and collectively, the “Owner”) are each single purpose limited liability companies structured to be bankruptcy remote, with two independent directors in each such entity’s organizational structure.  Owner Reisterstown Plaza Associates, LLC is the sole member of Borrower Inland Reisterstown SPE I, L.L.C. and Owner RRP Hecht, LLC is the sole member of Borrower Inland Reisterstown SPE II, L.L.C.  The sole member of each Owner is the Sponsor, Retail Properties of America, Inc., a Maryland corporation (the “Sponsor”), that is the non-recourse carve-out guarantor for the Reisterstown Road Plaza Loan.  Retail Properties of America, Inc., formerly known as Inland Western Retail Real Estate Trust, Inc., was formed on March 5, 2003 to acquire and manage a diversified portfolio of real estate, primarily multi-tenant shopping centers and single-user net lease properties.  The company is a fully-integrated, self-administered and self-managed real estate company that owns and operates high quality, strategically located shopping centers and single-user retail properties. Retail Properties of America, Inc. is one of the largest owner/operators of shopping centers in the United States.  As of March 31, 2012, their portfolio consisted of 258 properties with approximately 34.6 million Sq. Ft. of gross leasable area (“GLA”), geographically diversified across 35 states. The retail portfolio was 91.0% leased, including leases signed but not commenced, to approximately 1,500 tenants.  The portfolio includes power centers (45% of GLA), community/neighborhood centers (36% of GLA), lifestyle centers (9% of GLA), and single-user retail properties (10% of GLA).  On April 11, 2012, Retail Properties of America, Inc. closed on a public offering of 36.57 million shares of common stock, raising $292.6 million in gross proceeds. This transaction also resulted in the listing of the company’s class A common stock on the NYSE under the symbol “RPAI”.  As of August 24, 2012, RPAI had a total market capitalization of $2.48 billion.
 
The Property.    The Reisterstown Road Plaza Property is a 798,697 sq. ft. mixed use, anchored retail and office property.  It was constructed as an open-air retail shopping center in 1961, and later converted to an enclosed regional mall in the 1970’s.  In several stages between 1980 and 2003 the property was converted to its current use.  In 2003, parts of the north side of the Reisterstown Road Plaza Property were gutted and demolished to accommodate Marshalls and Giant Foods.  Most recently in 2011, the Sponsor completed $2.3 million of improvements refitting the space now occupied by Shopper’s World and Big Lots.  The Reisterstown Road Plaza Property currently includes a total collateral net rentable area (“NRA”) of 660,408 sq. ft., a pad site that is ground leased to Home Depot (115,289 sq. ft. owned by the tenant) and five pad sites ground leased to Applebee’s, Checker’s, KFC, Panda Express, and Wendy’s (23,000 sq. ft. in aggregate owned by the tenants). Retail space comprises 421,902 sq. ft. (63.9% of NRA) and office space
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov.  Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
19

 
 
6500 Reisterstown Road
Baltimore, MD 21215
Collateral Asset Summary
Reisterstown Road Plaza
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$46,250,000
58.5%
1.47x
11.7%
 
comprises 238,506 sq. ft. (36.1% of NRA).  Retail anchor tenants include:  Burlington Coat Factory (60,000 sq. ft.), Giant Foods (59,064 sq. ft.), Shopper’s World (53,040 sq. ft.), and Big Lots (38,089 sq. ft.). Retail junior anchors include:  Marshalls (28,500 sq. ft.), Modell’s Sporting Goods (19,892 sq. ft.), and Fitness Evolution (18,084 sq. ft.). Additionally, there are several national in-line tenants including: Bank of America (5,250 sq. ft.), Payless Shoes (4,985 sq. ft.), Foot Locker (3,000 sq. ft.), and M&T Bank (2,593 sq. ft.). The State of Maryland, rated AAA/Aaa/AAA by Fitch/Moody’s/S&P, leases 209,218 sq. ft. of office space (31.7% of NRA) at the Reisterstown Road Plaza Property under seven separate leases.  The Reisterstown Road Plaza Property owned collateral was 91.7% occupied as of the rent roll dated June 6, 2012.
 
The Reisterstown Road Plaza Property is located on Reisterstown Road in the northwest portion of the metropolitan area of Baltimore, Maryland, approximately 2.5 miles southeast of the I-695 and Reisterstown Road interchange, and 8.5 miles from the Baltimore CBD.  Interstate 83, which runs north from the Baltimore CBD, is located approximately 3 miles east of the subject property.  The subject property is located directly north of the Reisterstown Plaza Metro Station and is serviced by four MTA local bus services, which have stops at the property along Reisterstown Road.  Per the appraisal, approximately 4,300 businesses and over 39,000 daytime employees are estimated to be located within the 3-mile radius market area of the Reisterstown Road Plaza Property.
 
In January 2012, construction began on a 538,000 sq. ft. office complex which will house the Social Security Administration (“SSA”).  The SSA will sign a 20-year lease on the 11-acre campus, which is situated directly opposite the Reisterstown Plaza Metro Station, directly south of the Reisterstown Road Plaza Property.  The facility will feature two buildings, five and seven stories respectively, and include a parking garage.  According to the City of Baltimore, the facility will be home to up to 2,300 employees, which will be relocated from their current facility in West Baltimore. The project is expected to be delivered in 2014.
 
The Market.    The Reisterstown Road Plaza Property is located in Baltimore, Maryland. Baltimore is Maryland’s largest city and economic hub. The Baltimore MSA’s population for 2012 is estimated to be over 2.7 million.  With its central location on the East Coast of the United States, Baltimore is easily accessible via 6 interstates, rail through Penn Station Baltimore, air via BWI Airport, and water.
 
Per CoStar, the Baltimore Retail MSA contains 131,151,738 sq. ft. of space within 10,620 buildings. Vacancy as of Q1 2012, was 5.7%, down .5% from Q1 2011.  The market rental rate as of Q1 2012 was $18.10 per sq. ft, up $0.14 per sq ft from Q1 2011 which represents a 1% increase.  Net absorption was positive at 217,939 sq. ft. in Q1 2012, up from net negative absorption of 25,034 sq. ft. in Q1 2011.
 
CoStar places the Reisterstown Road Plaza Property in the Baltimore City West Retail Market and the Baltimore Northwest Retail Submarket.  The Baltimore City West Retail Market contains 944 buildings totaling 7,117,190 sq. ft.  Q1 2012 vacancy as reported by CoStar, was 4.5%, down 2.4% from Q1 2011.  The average rental rate was $13.99 per sq. ft in Q1 2012, which is down $0.61 from Q1 2011.  The Baltimore Northwest Retail Submarket contains 551 buildings totaling 4,564,455 sq. ft.   Vacancy was 3.6% and the average rental rate was $15.77 per sq. ft. as of Q1 2012.
 
According to CoStar, the Baltimore Office Market contains 128,750,398 sq. ft. within 5,947 buildings. As of Q1 2012, the vacancy rate was 12.3%, and rental rates were $21.28 per sq. ft. Net absorption has been consecutively positive over the last three quarters with Q1 2012 a positive 297,694 sq. ft. with 264,401 sq. ft. of new space coming online.  There are 2,613 class B buildings containing 61,081,972 sq. ft. and reported Q1 2012 vacancy at 11.3% and rental rates at $19.87 per sq. ft.
 
The Reisterstown Road Plaza Property is located in CoStar’s Baltimore City West Office Market and the Baltimore Northwest Office Submarket. The Baltimore City West Office Market is comprised of 7,014,849 Sq. Ft. within 292 office buildings.  Vacancy as of Q1 2012 was 13.4%, and rental rates were $19.03 per sq. ft. The Baltimore Northwest Office Submarket is comprised of 4,021,972 sq. ft. within 193 office buildings.  Vacancy and rental rates for class B properties in the Baltimore Northwest Office Submarket as of Q1 2012 were 5.8% and $21.23 per sq. ft. respectively.
 
The table below shows the Reisterstown Road Plaza Property’s vacancy rate and asking rents in comparison to its direct competitors in the submarket.
 
Summary of Comparable Retail Properties(1)
Building
Year Built /
Renovated
Size (Sq. Ft.)
% Leased
Asking Rent (Net)
Per Sq. Ft. (2)
Reisterstown Road Plaza Property
1961 / 2004
421,902       
  89%
$20.00
Mondawmin Mall
1956 / 1982
800,563       
  89%
$15.00-20.00
Northwest Plaza
1974 / NAV
219,977       
100%
$16.00-18.00
Fallstaff Center
1961 / NAV
92,983       
100%
$12.00-18.00
Patterson Village
1970 / NAV
37,500       
100%
$15.00-20.00
Total / Wtd. Avg.(3)
 
1,151,023       
   
(1)
Source: Appraisal, with the exception of the Reisterstown Road Plaza Property which is taken from the rent roll.
(2)
Asking Rent (Net) Per Sq. Ft. quoted on a NNN basis for shop space.  For the Reisterstown Road Plaza Property, asking rents reflective of tenants < 10,000 sq. ft. per rent roll.
(3)
Total / Wtd. Avg. excludes the Reisterstown Road Plaza Property.
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov.  Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
20

 
 
6500 Reisterstown Road
Baltimore, MD 21215
Collateral Asset Summary
Reisterstown Road Plaza
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$46,250,000
58.5%
1.47x
11.7%
 
Summary of Comparable Office Properties(1)
Building
Year Built / Renovated
Size (Sq. Ft.)
% Leased
Asking Rent Per
 Sq. Ft.
Class
Reisterstown Road Plaza Property
1961/2005
238,506      
96%
$11.80 modified gross
B
Pikesville Plaza Building
1977/1996/2011 / NAV
70,000      
89%
$16.00 modified gross
B
Beacham Square
1971 / NAV
92,983      
79%
$19.75 full service
B
Seton Business Park
1988 / NAV
62,610      
70%
$11.95 NNN
B
Blue Ocean Plaza
1963 / NAV
38,000      
33%
$12.00-17.50 NNN
C
Bedford Square
1985/2000 / NAV
26,654      
89%
$17.00 modified gross
B
Total / Wtd. Avg.(2)
 
290,247      
     
(1)
Source: Appraisal, with the exception of the Reisterstown Road Plaza Property which is taken from the rent roll.
(2)
Total / Wtd. Avg. excludes the Reisterstown Road Plaza Property.
 
Cash Flow Analysis.
 
Cash Flow Analysis
 
 
  12/31/2010
                  12/31/2011
              T-12 3/31/2012
         U/W
U/W Per Sq. Ft.(1)  
Base Rent
$7,828,581
$7,761,232
$7,678,393
$8,272,892
$12.53 
Value of Vacant Space
0
0
0
909,525
1.38 
Gross Potential Rent
$7,828,581
$7,761,232
$7,678,393
$9,182,417
$13.90 
Total Recoveries
1,681,162
1,699,676
1,675,618
1,744,189
2.64 
Total Other Income(2)
426,778
371,688
395,292
179,515
0.27 
Less: Vacancy(3)
0
0
0
(1,402,373)
(12.6%) 
Effective Gross Income
$9,936,521
$9,832,596
$9,749,303
$9,703,749
$14.69 
Total Operating Expenses
4,900,032
4,881,869
4,798,379
4,291,299
6.50 
Net Operating Income
$5,036,489
$4,950,727
$4,950,925
$5,412,450
$8.20 
TI/LC
0
0
0
669,852
1.01 
Capital Expenditures
0
0
0
246,525
0.37 
Net Cash Flow
$5,036,489
$4,950,727
$4,950,925
$4,496,073
$6.81 
(1)
U/W Per Sq. Ft. based on collateral sq. ft. of 660,408.
(2)
Other Income includes kiosk rental income, specialty income from vending contracts and percentage rent.
 
Property Management.    The Reisterstown Road Plaza Property is managed by RPAI US Management LLC, an affiliate of the Borrower.
 
Lockbox / Cash Management.    The Reisterstown Road Plaza Loan is structured with a hard lockbox and springing cash management.  Active cash management and a full sweep of excess cash flow are triggered upon any of the following:  (i) the DSCR falls below 1.15x based on trailing 3 months of gross income from operations annualized and 12 months of operating expenses assuming a 30-year amortization, (ii) bankruptcy or insolvency of the Borrower, the property manager or the Owner, or (iii) an event of default under the Reisterstown Road Plaza Loan.  Upon the occurrence of certain conditions specified in the Reisterstown Road Plaza loan documents, the excess cash flow sweep and active cash management will terminate until the occurrence of another trigger event.
 
Initial Reserves.    At closing, the Borrower deposited (i) $93,400 into a reserve to be held until the Borrower delivers an estoppel certificate from a specified tenant certifying that the rent abatement period for such tenant has expired, (ii) $400,000 into a rollover reserve (the “State Rollover Reserve”) which funds are to be used to pay rollover costs with respect to any replacement leases for space currently leased to State of Maryland tenants, (iii) $608,000 into a reserve to be held until the Borrower delivers an estoppel certificate from a specified tenant certifying eliminating the exception for overpayment of common area maintenance charges.
 
Ongoing Reserves.    On a monthly basis, the Borrower is required to deposit reserves as follows:  (i) if either (a) the DSCR falls below 1.20x based on a trailing 3 month period, assuming a 30-year amortization schedule, (b) an event of default occurs, or (c) the Borrower fails to deliver paid tax receipts on or prior to the date taxes are due, 1/12th of the expected annual taxes into a tax reserve account provided, if a tenant occupies an entire tax parcel, the Borrower shall not be obligated to fund 1/12th of expected annual taxes with respect to that tax parcel as long as (a) no event of default occurs, (b) such tenant’s lease is in full force and effect and (c) the Borrower delivers evidence that tenant is paying the taxes, (ii) there is no monthly insurance reserve if blanket insurance is in place for the property, provided, however if either (a) any notice of cancellation, termination, or lapse of any insurance coverage is received, (b) any cancellation, termination, or lapse of any insurance coverage occurs whether or not any notice is issued, (c) the Borrower or Owner does not deliver evidence of insurance coverages, or (d) the occurrence of any event of default, 1/12th of the expected insurance premiums
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov.  Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
21

 
 
6500 Reisterstown Road
Baltimore, MD 21215
Collateral Asset Summary
Reisterstown Road Plaza
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$46,250,000
58.5%
1.47x
11.7%
 
into an insurance reserve account, (iii) if the DSCR falls below 1.40x based on a trailing 3 month period, assuming a 30-year amortization, $54,836 into a general rollover reserve, which reserve is capped at $1,843,200, but is subject to replenishment, (iv) if the balance in the State Rollover Reserve falls below $400,000, $50,000 into the State Rollover Reserve until the balance in the State Rollover Reserve is restored to $400,000, and (v) if the Department of Public Safety provides notice of its intention to terminate its lease, $108,334 into a rollover reserve to be used to pay rollover costs with respect to any replacement lease for such tenant’s space, which reserve is capped at $1,300,000.  If the Home Depot exercises its rental option pursuant to its lease by payment to Owner or Borrower of the required $6.5 million adjustment payment (the “Home Depot Payment”), Owner or Borrower shall, within one business day of receipt of the Home Depot Payment, deposit the Home Depot Payment with Lender, to be held by Lender as additional security for the Loan.  Funds shall be released after the debt has been paid in full, and shall be paid to Owner.
 
Current Mezzanine or Subordinate Interest.    None.
 
Future Mezzanine or Subordinate Indebtedness.    None permitted.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov.  Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
22

 
 
6500 Reisterstown Road
Baltimore, MD 21215
Collateral Asset Summary
Reisterstown Road Plaza
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$46,250,000
58.5%
1.47x
11.7%
 
(MAP)
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov.  Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
23

 
 
2903 South Dogwood Road
El Centro, CA 92243
Collateral Asset Summary
Plaza at Imperial Valley
Cut-off Date Balance:
Cut-off Date LTV:
U/W NCF DSCR:
U/W NOI Debt Yield:
$44,907,541
70.3%
1.38x
9.8%
 
               
Mortgage Loan Information   Property Information
Loan Seller:
Barclays Bank PLC
   
Single Asset / Portfolio:
Single Asset
Loan Purpose:
Refinance
     
Property Type:
Retail – Anchored
Sponsor:
Ronald B. Russ and Jeffrey S. Gould
 
Collateral:
Fee Simple
Borrower:
RJFP LLC
     
Location:
El Centro, CA
Original Balance:
$45,000,000
     
Year Built / Renovated:
2007 / NAP
Cut-off Date Balance:
$44,907,541
     
Total Sq. Ft.:
362,400
% by Initial UPB:
TBD
     
Property Management:
Russ Group, Inc.
Interest Rate:
5.1520%
     
Underwritten NOI:
$4,383,310
Payment Date:
6th of each month
   
Underwritten NCF:
$4,078,950
First Payment Date:
August 6, 2012
     
Appraised Value:
$63,900,000
Maturity Date:
July 6, 2022
     
Appraisal Date:
April 16, 2012
Amortization:
360 months
      Historical NOI
Additional Debt:
None
     
  Most Recent NOI:
$4,147,358 (T-12 March 31, 2012)
Call Protection:
L(26), D(92), O(2)
   
  2nd Most Recent NOI:
$4,121,205 (December 31, 2011)
Lockbox / Cash Management:
Hard / In Place
 
  3rd Most Recent NOI:
$3,960,026 (December 31, 2010)
          Historical Occupancy (5)
Reserves (1)  
  Most Recent Occupancy:
92.9% (July 31, 2012)
 
Initial
Monthly   
 
  2nd Most Recent Occupancy:
83.1% (December 31, 2011)
Taxes:
$256,924
$42,821   
 
  3rd Most Recent Occupancy:
83.1% (December 31, 2010)
Insurance:
$20,471
$6,824   
 
  4th Most Recent Occupancy:
81.2% (December 31, 2009)
Replacement:
$0
$4,530   
 
(1)
See “Initial Reserves” and “Ongoing Reserves” herein.
Deferred Maintenance:
$135,695
NAP   
 
(2)
The TI/LC reserve is subject to a $1,500,000 cap and is required to be replenished at a rate of $20,833 per month if reduced below the cap.
TI/LC(2):
$1,041,875
$20,833    
 
Olive Garden Lease
     
(3)
$818,750 of the $1,000,000 Olive Garden Lease Holdback funded at closing by Olive Garden will be released to borrower imminently as a fully executed lease deemed acceptable to lender was delivered.
Holdback(3):
$181,250
NAP   
 
2019 Rollover Reserve (4):
$0
Springing     
         
(4)
A full cash sweep will commence in January 2018 and funds collected will be deposited into the 2019 Rollover Reserve Fund until a cap of $1,300,000 is met. The Borrower has the option to post an acceptable letter of credit in the amount of $1,300,000 in lieu of a cash flow sweep.
Financial Information  
 
 
 
Cut-off Date Balance / Sq. Ft.:
   $124  
(5)
Historical Occupancy shown in the table above is based on historical operating statements and occupancy percentages provided by the Borrower.
Balloon Balance / Sq. Ft.:
 
 $103  
Cut-off Date LTV:
 
 70.3%        
Balloon LTV:
 
 58.2%        
Underwritten NOI DSCR:
 
 1.49x        
Underwritten NCF DSCR:
 
 1.38x        
Underwritten NOI Debt Yield:
 
 9.8%        
Underwritten NCF Debt Yield:
 
 9.1%        
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The depositor has filed a registration statement (including the prospectus) with the SEC (SEC File No. 333-177354) 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 website at www.sec.gov. Alternatively, the depositor or UBS Securities LLC, any other underwriter, or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free 1-877-713-1030.
 
 
24

 
 
2903 South Dogwood Road
El Centro, CA 92243
Collateral Asset Summary