FWP 1 morgan-stanley.htm Unassociated Document
 
  FREE WRITING PROSPECTUS
  Filed Pursuant to Rule 433
  Registration Statement No. 333-167764 and No. 333-167764-02
 
  
(morgan stanley logo)   (bank of america merrill lynch logo)
 
MSC 2012-C4
 
Free Writing Prospectus
Structural and Collateral Term Sheet
 
$1,098,695,600
 
(Approximate Total Mortgage Pool Balance)
 
$880,329,000
 
(Approximate Offered Certificates)
 
Morgan Stanley Capital I Inc.
 
as Depositor
 
Morgan Stanley Mortgage Capital Holdings LLC
Bank of America, National Association
 
as Sponsors and Mortgage Loan Sellers
 
 
Commercial Mortgage Pass-Through Certificates
Series 2012-C4
 
 
March 5, 2012
 
MORGAN STANLEY
                                                                                BofA MERRILL LYNCH
   
Co-Lead Bookrunning Manager
                                                                                Co-Lead Bookrunning Manager
   
 
STATEMENT REGARDING THIS FREE WRITING PROSPECTUS
 
The depositor has filed a registration statement (including a prospectus) with the SEC (File Number 333-167764) for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the depositor has filed with the SEC for more complete information about the depositor, the issuing entity and this offering. You may get these documents for free by visiting EDGAR on the SEC web site at www.sec.gov. Alternatively, the depositor or any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling toll free 1-866-718-1649 or by email to prospectus@ms.com.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. It was prepared by Morgan Stanley and BofA Merrill Lynch sales, trading, banking or other non-research personnel. This Term Sheet was not intended or written to be used, and it cannot be used by any taxpayer, for the purpose of avoiding penalties that may be imposed on the taxpayer under U.S. federal tax laws. Each taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
 
 
 
 
IMPORTANT NOTICE RELATING TO AUTOMATICALLY GENERATED EMAIL DISCLAIMERS
 
Any legends, disclaimers or other notices that may appear at the bottom of, or attached to, the email communication to which this material may have been attached 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 email system.
 
IMPORTANT NOTICE REGARDING THE CONDITIONS FOR THIS OFFERING OF ASSET-BACKED SECURITIES
 
THE ASSET-BACKED SECURITIES REFERRED TO IN THESE MATERIALS ARE BEING OFFERED WHEN, AS AND IF ISSUED.  IN PARTICULAR, YOU ARE ADVISED THAT THE ASSET-BACKED SECURITIES, AND THE ASSET POOL BACKING THEM, ARE SUBJECT TO MODIFICATION OR REVISION (INCLUDING, AMONG OTHER THINGS, THE POSSIBILITY THAT ONE OR MORE CLASSES OF SECURITIES MAY BE SPLIT, COMBINED OR ELIMINATED), AT ANY TIME PRIOR TO ISSUANCE OR AVAILABILITY OF A FINAL PROSPECTUS.  AS A RESULT, YOU MAY COMMIT TO PURCHASE SECURITIES THAT HAVE CHARACTERISTICS THAT MAY CHANGE, AND YOU ARE ADVISED THAT ALL OR A PORTION OF THE SECURITIES MAY NOT BE ISSUED THAT HAVE THE CHARACTERISTICS DESCRIBED IN THESE MATERIALS.  OUR OBLIGATION TO SELL SECURITIES TO YOU IS CONDITIONED ON THE SECURITIES AND THE UNDERLYING TRANSACTION HAVING THE CHARACTERISTICS DESCRIBED IN THESE MATERIALS.  IF WE DETERMINE THAT THE FORGOING CONDITION IS NOT SATISFIED IN ANY MATERIAL RESPECT, WE WILL NOTIFY YOU, AND NEITHER THE ISSUING ENTITY NOR ANY UNDERWRITER WILL HAVE ANY OBLIGATION TO YOU TO DELIVER ALL OR ANY PORTION OF THE SECURITIES WHICH YOU HAVE COMMITTED TO PURCHASE, AND THERE WILL BE NO LIABILITY BETWEEN US AS A CONSEQUENCE OF THE NON-DELIVERY.
 
IMPORTANT INFORMATION AND IRS CIRCULAR 230 NOTICE
 
THIS MATERIAL HAS BEEN PREPARED FOR INFORMATION PURPOSES TO SUPPORT THE PROMOTION OR MARKETING OF THE TRANSACTION OR MATTERS ADDRESSED HEREIN. THIS IS NOT A RESEARCH REPORT AND WAS NOT PREPARED BY THE MORGAN STANLEY OR BOFA MERRILL LYNCH RESEARCH DEPARTMENTS. IT WAS PREPARED BY MORGAN STANLEY AND BOFA MERRILL LYNCH SALES, TRADING, BANKING OR OTHER NON-RESEARCH PERSONNEL. THIS TERM SHEET WAS NOT INTENDED OR WRITTEN TO BE USED, AND IT CANNOT BE USED BY ANY TAXPAYER, FOR THE PURPOSE OF AVOIDING PENALTIES THAT MAY BE IMPOSED ON THE TAXPAYER UNDER U.S. FEDERAL TAX LAWS. EACH TAXPAYER SHOULD SEEK ADVICE BASED ON THE TAXPAYER’S PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR. PLEASE SEE ADDITIONAL IMPORTANT INFORMATION AND QUALIFICATIONS AT THE END OF THIS TERM SHEET.
 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. It was prepared by Morgan Stanley and BofA Merrill Lynch sales, trading, banking or other non-research personnel. This Term Sheet was not intended or written to be used, and it cannot be used by any taxpayer, for the purpose of avoiding penalties that may be imposed on the taxpayer under U.S. federal tax laws. Each taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
 
T-1
 
 
MSC 2012-C4 Certificates
 
Offered Certificates
 
                 
 Class
Expected Ratings
(DBRS/KBRA/Moody’s)(1)
Approximate Initial Certificate Balance(2)
Approximate Initial Credit Support(3)
Pass-Through
Rate
Description
Expected Weighted Average Life (Years)(5)
Principal
Window
(Months)(5)
Certificate Principal UW
NOI Debt
Yield(6)
Certificate
Principal
to Value
Ratio(7)
 Class A-1
AAA(sf)/AAA(sf)/Aaa(sf)
$65,086,000
 30.000%
Fixed
2.38
1-53
 18.1%
 40.9%
 Class A-2
AAA(sf)/AAA(sf)/Aaa(sf)
$244,709,000
 30.000%
Fixed
4.68
53-60
 18.1%
 40.9%
 Class A-3
AAA(sf)/AAA(sf)/Aaa(sf)
$75,630,000
 30.000%
Fixed
7.31
60-113
 18.1%
 40.9%
 Class A-4
AAA(sf)/AAA(sf)/Aaa(sf)
$383,661,000
 30.000%
Fixed
9.72
113-120
 18.1%
 40.9%
 Class A-S
AAA(sf)/AAA(sf)/Aaa(sf)
$111,243,000
 19.875%
Fixed
9.96
120-120
 15.9%
 46.8%
 
Privately Offered Certificates(8)
 
                 
 Class
 Expected Ratings
(DBRS/KBRA/Moody’s)(1)
Approximate Initial
Certificate Balance or
Notional Amount(2)
Approximate
Initial Credit
Support(3)
Pass-Through
Rate
Description
Expected
Weighted
Average Life
(Years)(5)
Principal
Window
(Months)(5)
Certificate
Principal UW
NOI Debt
Yield(6)
Certificate
Principal
to Value
Ratio(7)
 Class X-A
AAA(sf)/AAA(sf)/Aaa(sf)
$880,329,000(9)
NAP
Variable(10)
NAP
NAP
NAP
NAP
 Class X-B
AAA(sf)/NR/Ba3(sf)
$218,366,600(9)
NAP
Variable(10)
NAP
NAP
NAP
NAP
 Class B
AA(sf)/AA(sf)/Aa2(sf)
$50,815,000
 15.250%
(4)
9.96
120-120
 15.0%
 49.5%
 Class C
A(sf)/A(sf)/A2(sf)
$37,081,000
 11.875%
(4)
9.96
120-120
 14.4%
 51.5%
 Class D
BBB(high)(sf)/BBB+(sf)/Baa1(sf)
$24,721,000
 9.625%
(4)
9.96
120-120
 14.1%
 52.8%
 Class E
BBB(low)(sf)/BBB-(sf)/Baa3(sf)
$39,827,000
 6.000%
(4)
9.96
120-120
 13.5%
 54.9%
 Class F
BB(sf)/BB(sf)/Ba2(sf)
$17,854,000
 4.375%
Fixed
9.96
120-120
 13.3%
 55.8%
 Class G
B(sf)/B(sf)/B2(sf)
$19,227,000
 2.625%
Fixed
9.96
120-120
 13.0%
 56.9%
 Class H(11)
NR/NR/NR
$28,841,600
0.000%
Fixed
9.96
120-120
 12.7%
 58.4%
 
(1)
Ratings shown are those of DBRS, Inc., Kroll Bond Rating Agency, Inc. and Moody’s Investors Service, Inc. Certain nationally recognized statistical rating organizations that were not hired by the depositor may use information they receive pursuant to Rule 17g-5 under the Securities Exchange Act of 1934, as amended, to rate the certificates. There can be no assurance as to what ratings a non-hired nationally recognized statistical rating organization would assign. See “Risk Factors—Ratings of the Offered Certificates Do Not Represent Any Assessment of the Yield to Maturity That a Certificateholder May Experience and Such Ratings May Be Reviewed, Revised, Suspended, Downgraded, Qualified or Withdrawn By the Applicable Rating Agency” and “Ratings” in the other free writing prospectus, dated March 5, 2012 (the “Free Writing Prospectus”) to which the prospectus dated March 2, 2012 (the “Prospectus”) is attached as Exhibit A. Capitalized terms used but not defined herein have the meanings assigned to such terms in the Free Writing Prospectus.
 
(2)
The certificate principal balances and notional amounts are approximate and on the closing date may vary by up to 5%. Mortgage loans may be removed from or added to the mortgage pool prior to the closing date within the same maximum permitted variance. Any reduction or increase in the aggregate principal balance of mortgage loans within these parameters will result in changes to the initial certificate principal balance or notional amount of each class of certificates and to the other statistical data contained herein and in the Free Writing Prospectus.
 
(3)
The percentages indicated under the column “Approximate Initial Credit Support” with respect to the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates represent the approximate credit support for the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates in the aggregate.
 
(4)
The subject certificates will, at all times, accrue interest at a per annum rate equal to (i) a fixed rate, (ii) a fixed rate subject to a cap equal to the weighted average of the net interest rates on the mortgage loans (in each case adjusted, if necessary, to accrue on the basis of a 360-day year consisting of twelve (12) 30-day months) or (iii) a rate equal to the weighted average of the net interest rates on the mortgage loans (in each case adjusted, if necessary, to accrue on the basis of a 360-day year consisting of twelve (12) 30-day months) less a specified percentage, which percentage may be zero.
 
(5)
The principal window is expressed in months following the closing date and reflects the period during which distributions of principal would be received under the assumptions set forth in the following sentence. The expected weighted average life and principal window figures set forth above are based on the following assumptions, among others: (i) no defaults or subsequent losses on the underlying mortgage loans; (ii) no extensions of maturity dates of mortgage loans that do not have “anticipated repayment dates”; (iii) payment in full on the stated maturity date, or in the case of each mortgage loan having an anticipated repayment date, on the anticipated repayment date; and (iv) no prepayments of the mortgage loans prior to maturity or, in the case of a mortgage loan having an anticipated repayment date, prior to such anticipated repayment date. See the structuring assumptions set forth under “Yield, Prepayment and Maturity Consideration—Weighted Average Life” in the Free Writing Prospectus.
 
(6)
Certificate Principal UW NOI Debt Yield for any class of principal balance certificates is calculated as the product of (a) the weighted average UW NOI Debt Yield for the mortgage pool, multiplied by (b) a fraction, the numerator of which is the total initial certificate principal balance of all the principal balance certificates, and the denominator of which is the total initial certificate principal balance of the subject class of principal balance certificates and all other classes, if any, that are senior to such class. The Certificate Principal UW NOI Debt Yields of the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates are calculated in the aggregate for those classes as if they were a single class.
 
(7)
Certificate Principal to Value Ratio for any class of principal balance certificates is calculated as the product of (a) the weighted average Cut-off Date LTV Ratio of the mortgage pool, multiplied by (b) a fraction, the numerator of which is the total initial certificate principal balance of the subject class of principal balance certificates and all other classes, if any, that are senior to such class, and the denominator of which is the total initial certificate principal balance of all the principal balance certificates. The Certificate Principal to Value Ratios of the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates are calculated in the aggregate for those classes as if they were a single class.
 
(Footnotes continued on next page)
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-2
 
 
MSC 2012-C4 Certificates
 
(8)
Not offered pursuant to the Prospectus, the Free Writing Prospectus or this term sheet. Information provided in this term sheet regarding the characteristics of the certificates is provided only to enhance your understanding of the offered certificates.
 
(9)
The Class X-A and Class X-B Certificates will not have certificate principal balances and will not be entitled to receive distributions of principal. Interest will accrue on the Class X-A and Class X-B Certificates at their respective pass-through rates based upon their respective notional amounts. The notional amount of the Class X-A Certificates will equal the aggregate certificate principal balance of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-S Certificates outstanding from time to time. The notional amount of the Class X-B Certificates will equal the aggregate certificate principal balance of the Class B, Class C, Class D, Class E, Class F, Class G and Class H Certificates outstanding from time to time.
 
(10)
The pass-through rate on the Class X-A Certificates will generally be equal to the excess, if any, of (i) the weighted average of the net interest rates on the mortgage loans (in each case adjusted, if necessary, to accrue on the basis of a 360-day year consisting of twelve 30-day months), over (ii) the weighted average of the pass-through rates of the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-S Certificates as described in the Free Writing Prospectus. The pass-through rate on the Class X-B Certificates will generally be equal to the excess, if any, of (i) the weighted average of the net interest rates on the mortgage loans (in each case adjusted, if necessary, to accrue on the basis of a 360-day year consisting of twelve 30-day months), over (ii) the weighted average of the pass-through rates of the Class B, Class C, Class D, Class E, Class F, Class G and Class H Certificates as described in the Free Writing Prospectus.
 
(11)
Each Class H Certificate is an investment unit consisting of a REMIC regular interest and an undivided beneficial ownership interest in a grantor trust that holds an interest in certain excess interest in respect of mortgage loans having anticipated repayment dates.
 
The certificates also include the Class R Certificates, which do not have a certificate principal balance, notional amount, pass-through rate, rating or rated final distribution date.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-3
 
 
MSC 2012-C4
 Issue Characteristics
 
Issue Characteristics
 
Offered Certificates:
  
$880,329,000 (approximate) monthly pay, multi-class, commercial mortgage REMIC Pass-Through Certificates, consisting of five principal balance classes (Class A-1, Class A-2, Class A-3, Class A-4 and Class A-S Certificates), offered pursuant to a registration statement filed with the SEC (File Number 333-167764)
     
Co-Lead Bookrunning
Managers:
  
Morgan Stanley & Co. LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated
     
Mortgage Loan Sellers:
  
Morgan Stanley Mortgage Capital Holdings LLC and Bank of America, National Association
     
Rating Agencies:
  
DBRS, Inc., Kroll Bond Rating Agency, Inc. and Moody’s Investors Service, Inc.
     
Master Servicer:
  
Bank of America, National Association
     
Special Servicer:
  
Midland Loan Services, a Division of PNC Bank, National Association
     
Trustee:
  
Wells Fargo Bank, National Association
     
Certificate Administrator/
Certificate Registrar:
  
Wells Fargo Bank, National Association
     
Trust Advisor:
  
Pacific Life Insurance Company
     
Initial Controlling Class
Representative:
  
BlackRock Financial Management Inc., as manager for one or more managed funds or accounts
     
Cut-off Date:
  
March 1, 2012. For purposes of the information contained in this term sheet (this “Term Sheet”), scheduled payments due in March 2012 with respect to mortgage loans not having payment dates on the first day of each month have been deemed received on March 1, 2012, not the actual day on which such scheduled payments were due.
     
Expected Pricing Date:
  
Week of March 5, 2012
     
Expected Closing Date:
  
On or about March 28, 2012
     
Determination Dates:
  
The 11th calendar day of each month (if the 11th calendar day is not a business day, the next succeeding business day), commencing in April 2012
     
Distribution Dates:
  
The 4th business day following the Determination Date in each month, commencing in April 2012
     
Rated Final Distribution Date:
  
The Distribution Date in March 2045
     
Interest Accrual Period:
  
Preceding calendar month
     
Payment Structure:
  
Sequential pay
     
Tax Treatment:
  
REMIC, except that the Class H Certificates also evidence an interest in a grantor trust
     
Optional Termination:
  
1.0% clean-up call
     
Minimum Denominations:
  
$25,000 for each class of Offered Certificates
     
Settlement Terms:
  
DTC, Euroclear and Clearstream
     
Legal/Regulatory Status:
  
Class A-1, Class A-2, Class A-3, Class A-4 and Class A-S Certificates are expected to be eligible for exemptive relief under ERISA. No class of certificates is SMMEA eligible.
     
Analytics:
  
The certificate administrator will be required to make available all distribution date statements, CREFC reports and supplemental notices received by it to certain modeling
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-4
 
 
MSC 2012-C4
 Issue Characteristics
 
   
financial services (i.e., BlackRock Financial Management, Inc., Bloomberg, L.P., Intex Solutions, Inc., Markit, CMBS.com, Inc. and Trepp LLC).
     
Bloomberg Ticker:
  
MSC 2012-C4 <MTGE><GO>
     
Risk Factors:
  
THE CERTIFICATES INVOLVE CERTAIN RISKS AND MAY NOT BE SUITABLE FOR ALL INVESTORS. SEE THE “RISK FACTORS” SECTION OF THE FREE WRITING PROSPECTUS AND THE “RISK FACTORS” SECTION OF THE PROSPECTUS.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-5
 
 
MSC 2012-C4
 Structural Overview
 
Structural Overview
 
Accrual:
  
Each class of Offered Certificates will accrue interest on a 30/360 basis.
     
Amount and Order of
Distributions:
  
On each distribution date, certificateholders will be entitled to receive distributions of interest and principal from funds received with respect to the mortgage loans and available for distribution. Funds available for distribution on the certificates will be net of excess interest, excess liquidation proceeds and specified trust expenses, including all advance reimbursements (with interest) and all servicing fees and expenses, certificate administrator fees (including trustee fees) and expenses, and trust advisor fees and expenses as set forth below. Distributions to certificateholders on each distribution date will be in an amount equal to each class’s interest and principal entitlement, subject to:
 
(i) payment of the respective interest entitlement for any other class of certificates bearing an earlier alphanumeric designation (except in respect of the distribution of interest among the Class A-1, Class A-2, Class A-3, Class A-4, Class X-A and Class X-B Certificates, which will have the same senior priority and be distributed pro rata);
 
(ii) if applicable, payment of the respective principal entitlement for the distribution date to the outstanding classes of principal balance certificates having an earlier alphanumeric designation (and, in the case of the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates, generally in that order, however, if the certificate principal balance of each class of principal balance certificates other than the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates has been reduced to zero as a result of the allocation of mortgage loan losses or trust advisor expenses to those certificates, or if the aggregate appraisal reduction equals or exceeds the aggregate certificate principal balance of the Class A-S through Class H Certificates, then on a pro rata basis among the holders of the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates) until the certificate principal balance of each such class has been reduced to zero; and
 
(iii) the allocation of trust advisor expenses, (a) first, to reduce payments of interest on the Class E, Class D, Class C and Class B Certificates, in that order, and (b) second, to reduce payments of principal on the Class E, Class D, Class C, Class B and Class A-S Certificates, in that order, and (c) third, to reduce payments of principal on the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates on a pro rata basis;
 
No trust advisor expenses (other than the trust advisor fee) will be allocated to or otherwise borne by the Control Eligible Certificates. As a result, none of the classes of Control Eligible Certificates will provide protection to the more senior classes of certificates for the purposes of allocating losses based on trust advisor expenses.
     
Interest and Principal
Entitlements:
  
Interest distributable on any class of certificates (other than the Class R Certificates) on any distribution date, with various adjustments described under “Description of the Offered Certificates—Distributions” in the Free Writing Prospectus, represents all unpaid interest accrued with respect to that class of certificates through the end of the interest accrual period that corresponds to that distribution date. Interest accrues with respect to the interest-bearing certificates on the basis of a 360-day year consisting of twelve 30-day months. Interest accrues with respect to each interest-bearing certificate during each interest accrual period at the applicable pass-through rate for, and on the certificate principal balance or notional amount, as applicable, of that certificate outstanding immediately prior to, the distribution date that corresponds to that interest accrual period. However, as described in “Description of the Offered Certificates—Distributions” in the Free Writing Prospectus, there are circumstances relating to the timing of prepayments in which a certificateholder’s interest entitlement for a distribution date could be less than one full month’s interest at the pass-through rate on the certificate’s principal balance or notional amount. In addition, the right of the master servicer, the special servicer and the trustee to reimbursement for payment of advances (with interest thereon), and the rights
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-6
 
 
MSC 2012-C4
 Structural Overview
 
   
of such parties and of the certificate administrator and, subject to certain limitations, the trust advisor to the payments of compensation and reimbursement of certain costs and expenses will be prior to a certificateholder’s right to receive distributions of principal or interest. In addition, the right of the trust advisor to receive its fees and reimbursement of trust advisor expenses will be prior to the right of the holders of the Class B, Class C, Class D and Class E Certificates to receive payments of interest, and to the holders of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-S, Class B, Class C, Class D and Class E Certificates to receive payments of principal. The Class R, Class X-A and Class X-B Certificates will not be entitled to principal distributions.
 
The amount of principal required to be distributed on the classes entitled to principal on a particular distribution date will, in general, be equal to the sum of: (i) the principal portion of all scheduled payments, other than balloon payments, to the extent received during the related collection period or advanced by the master servicer or other party (in accordance with the pooling and servicing agreement) in respect of such distribution date; (ii) all principal prepayments and the principal portion of balloon payments received during the related collection period; (iii) the principal portion of other collections on the mortgage loans received during the related collection period, for example liquidation proceeds, condemnation proceeds, insurance proceeds and income on “real estate owned”; and (iv) the principal portion of proceeds of mortgage loan repurchases received during the related collection period; subject, to certain adjustments described in the Free Writing Prospectus relating to the payment or reimbursement of nonrecoverable advances, workout-delayed reimbursement amounts and trust advisor expenses, and exclusive of any late collections of principal received during the related collection period for which there is an outstanding advance.
     
Servicing and Administration
Fees:
  
The master servicer and special servicer are entitled to a master servicing fee and a special servicing fee, respectively, payable from general collections on the mortgage loans. The master servicing fee for each distribution date is calculated based on the outstanding principal balance of each mortgage loan and REO mortgage loan at the master servicing fee rate, which ranges from 0.02% to 0.04% per annum. As of the cut-off date, the weighted average master servicing fee will be approximately 0.0206%. The special servicing fee for each distribution date is calculated based on the outstanding principal balance of each mortgage loan that is a specially serviced mortgage loan or as to which the related mortgaged property has become an REO property at the special servicing fee rate, which is equal to 0.25% per annum. Any primary servicing fee or sub-servicing fee will be paid by the master servicer or special servicer, as applicable, out of the fees described above. The master servicer and special servicer are also entitled to additional fees and amounts, including, without limitation, income on the amounts held in permitted investments. The special servicer will also be entitled to (i) liquidation fees generally equal to 1.0% of liquidation proceeds in respect of a specially serviced mortgage loan or REO property and (ii) workout fees generally equal to 1.0% of interest and principal payments made in respect of a rehabilitated mortgage loan, subject to a cap with respect to each such fee of $1,000,000 with respect to any mortgage loan or REO property and subject to certain adjustments and exceptions as described in the Free Writing Prospectus under “Servicing of the Mortgage Loans—The Special Servicer—Special Servicer Compensation.”  The trust advisor will be entitled to the trust advisor fee for each distribution date, calculated based on the outstanding principal balance of each mortgage loan at the trust advisor fee rate, which will equal 0.0020% per annum.
 
The certificate administrator fee for each distribution date is calculated on the outstanding principal balance of each mortgage loan at the certificate administrator fee rate, which is equal to 0.0042% per annum, and is payable out of general collections on the mortgage loans. The trustee fee for each distribution date is a portion of the certificate administrator fee. Each of the master servicing fee, the special servicing fee, the trust advisor fee and the certificate administrator fee will be calculated on the same interest accrual basis as is interest on the related mortgage loan and will be prorated for any partial period.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-7
 
 
MSC 2012-C4
 Structural Overview
 
   
The administrative fee rate will be the sum of the master servicing fee rate, the trust advisor fee rate and the certificate administrator fee rate, and is set forth for each mortgage loan on Appendix I to the Free Writing Prospectus.
     
Prepayment Premiums/Yield
Maintenance Charges:
  
On any distribution date, prepayment premiums or yield maintenance charges collected in respect of each mortgage loan during the related collection period will be distributed by the certificate administrator on the classes of certificates as follows: to the holders of each class of principal balance certificates (exclusive of the Control Eligible Certificates) then entitled to distributions of principal on such distribution date, an amount equal to the product of (a) a fraction, the numerator of which is the amount distributed as principal to the holders of that class on that distribution date, and the denominator of which is the total amount distributed as principal to the holders of all classes of principal balance certificates on that distribution date, (b) the Base Interest Fraction for the related principal prepayment and that class and (c) the amount of the prepayment premium or yield maintenance charge collected in respect of such principal prepayment during the one month period ending on the related determination date. Any prepayment premiums or yield maintenance charges relating to the mortgage loans collected during the related collection period and remaining after those distributions described above (as to the applicable distribution date, the “Class X YM Distribution Amount”) will be distributed to the holders of the Class X-A and Class X-B Certificates, as follows: first, to holders of the Class X-A Certificates in an amount equal to the product of (a) a fraction, the numerator of which is the total amount of principal distributed with respect to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-S Certificates on the applicable distribution date, and the denominator of which is the total principal distributed with respect to the principal balance certificates on the applicable distribution date, multiplied by (b) the Class X YM Distribution Amount for the applicable distribution date; and second, to the holders of the Class X-B Certificates in an amount equal to the portion of the Class X YM Distribution Amount remaining after the distributions to the holders of the Class X-A Certificates.
 
The “Base Interest Fraction”, with respect to any principal prepayment of any mortgage loan that provides for payment of a prepayment premium or yield maintenance charge, and with respect to any class of principal balance certificates, is a fraction (A) whose numerator is the greater of (x) zero and (y) the difference between (i) the pass-through rate on that class of certificates and (ii) the applicable discount rate and (B) whose denominator is the difference between (i) the mortgage interest rate on the related mortgage loan and (ii) the applicable discount rate; provided, however, that under no circumstances will the Base Interest Fraction be greater than one. If the discount rate referred to above is greater than or equal to the mortgage interest rate on the related mortgage loan, then the Base Interest Fraction will equal zero; provided, however, that if the discount rate referred to above is greater than or equal to the mortgage interest rate on the related mortgage loan, but is less than the pass-through rate on that class, then the Base Interest Fraction shall be equal to 1.0.
 
Consistent with the foregoing, the Base Interest Fraction is equal to:
 
      (Pass-Through Rate – Discount Rate)  
     
    (Mortgage Rate – Discount Rate)
     
   
No prepayment premiums or yield maintenance charges will be distributed to holders of the Control Eligible Certificates or the Class R Certificates.
     
Servicing Advances:
  
Subject to a recoverability determination described in the Free Writing Prospectus, the master servicer and/or the trustee may make servicing advances to pay delinquent real estate taxes, insurance premiums and similar expenses necessary to protect, lease, manage and maintain the mortgaged property, to maintain the lien on the mortgaged property or to enforce the mortgage loan documents. In addition, the special servicer may, but is not required to, make servicing advances on an emergency basis.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-8
 
 
MSC 2012-C4
 Structural Overview
 
Collateral Support
Deficits:
  
On each distribution date, immediately following the distributions made to the certificateholders on that date, the certificate administrator will be required to calculate the amount, if any, by which (1) the aggregate stated principal balance of the mortgage loans, including any mortgage loans as to which the related mortgaged properties have become REO properties, expected to be outstanding immediately following that distribution date, is less than (2) the aggregate certificate principal balance of the principal balance certificates after giving effect to distributions of principal on that distribution date and the allocation of any excess trust advisor expenses to reduce the certificate principal balances of the principal balance certificates that are not Control Eligible Certificates on that distribution date (any such deficit, a “Collateral Support Deficit”).
 
On each distribution date, the certificate administrator will be required to allocate any Collateral Support Deficit to the respective classes of principal balance certificates in the following order:  to the Class H Certificates, Class G Certificates, Class F Certificates, Class E Certificates, Class D Certificates, Class C Certificates, Class B Certificates and Class A-S Certificates, in each case in respect of and until the remaining certificate principal balance of that class of certificates has been reduced to zero. Following the reduction of the certificate principal balances of all such classes of subordinate certificates to zero, the certificate administrator will be required to allocate the Collateral Support Deficit to the Class A-1, Class A-2, Class A-3 and Class A-4 Certificates, pro rata (based upon their respective certificate principal balances), until the remaining certificate principal balances of those classes of certificates have been reduced to zero. Any Collateral Support Deficit allocated to a class of certificates will be allocated to the respective certificates of such class in proportion to the Percentage Interests evidenced by the respective certificates.
     
Appraisal Reductions:
  
The occurrence of certain adverse events affecting a mortgage loan (“Appraisal Events”) will require the special servicer to obtain a new appraisal or other valuation of the related mortgaged property. In general, if the principal amount of a mortgage loan plus all other amounts due under the mortgage loan and interest on advances made with respect to the mortgage loan exceeds 90% of the value of the mortgaged property determined by an appraisal or other valuation, an appraisal reduction may be created in the amount of the excess as described in the Free Writing Prospectus. Notwithstanding the foregoing, if an appraisal is required to be obtained in accordance with the pooling and servicing agreement but is not obtained within one hundred twenty (120) days following the applicable Appraisal Event, then, until such appraisal is obtained and solely for purposes of determining the amounts of P&I advances, the appraisal reduction will equal 25% of the stated principal balance of the related mortgage loan; provided that, upon receipt of an appraisal, the appraisal reduction for such mortgage loan will be recalculated generally in accordance with the preceding sentence.
 
If an appraisal reduction exists for any mortgage loan, the interest portion of the amount required to be advanced on that mortgage loan will be reduced in the same proportion that the appraisal reduction bears to the stated principal balance of that mortgage loan. This will reduce the funds available to pay interest on the most subordinate class or classes of certificates then outstanding.
 
If there are any A/B whole loans or loan pairs included in the mortgage pool, any appraisal reduction will be calculated in respect of such A/B whole loan or loan pair taken as a whole. With respect to an A/B whole loan, any such appraisal reduction will be allocated first to the related B note and then to the related A note. With respect to a loan pair, any such appraisal reduction will be allocated between the mortgage loan and the related serviced companion loan on a pro rata basis by unpaid principal balance.
 
For a discussion of how Appraisal Reductions are calculated and allocated, see “Description of the Offered Certificates—Appraisal Reductions” in the Free Writing Prospectus.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-9
 
 
MSC 2012-C4
 Structural Overview
 
Control Rights:
  
Subject to the limitations described below under “Subordinate Debt Control Rights” in respect of any A/B whole loans or loan pairs, during any Subordinate Control Period, the controlling class representative will have certain consent and consultation rights under the pooling and servicing agreement with respect to certain major decisions and other matters. A “Subordinate Control Period” means any period when the aggregate certificate principal balance of the Class F Certificates (taking into account the application of appraisal reductions to notionally reduce the aggregate certificate principal balance of such class) is at least 25% of the initial aggregate certificate principal balance of that class.
 
During any Collective Consultation Period, the controlling class representative will not have any consent rights, but the controlling class representative and the trust advisor will have certain non-binding consultation rights under the pooling and servicing agreement with respect to certain major decisions and other matters. A “Collective Consultation Period” means any period when both (i) the aggregate certificate principal balance of the Class F Certificates (taking into account the application of appraisal reductions to notionally reduce the aggregate certificate principal balance of such class), is less than 25% of the initial aggregate certificate principal balance of the Class F Certificates and (ii) the aggregate certificate principal balance of that class (without regard to any appraisal reductions allocable to such class), is at least 25% of the initial aggregate certificate principal balance of that class.
 
During any Senior Consultation Period, the controlling class representative will not have any consent or consultation rights, except with respect to any rights that expressly survive such termination pursuant to the pooling and servicing agreement, and the trust advisor will retain certain non-binding consultation rights under the pooling and servicing agreement with respect to certain major decisions and other matters. A “Senior Consultation Period” means a period when the aggregate certificate principal balance of the Class F Certificates (without regard to any appraisal reductions allocable to such class) is less than 25% of the initial aggregate certificate principal balance of that class. See “Servicing of the Mortgage Loans—The Controlling Class Representative” in the Free Writing Prospectus.
     
Subordinate Debt
Control Rights:
  
If any mortgage loan is part of an A/B whole loan or loan pair, the controlling class representative’s consent and/or consultation rights with respect thereto will be limited as further described in the Free Writing Prospectus. See “—Directing Holders” below, and “Risk Factors—Realization on a Mortgage Loan That Is Part of an A/B Whole Loan or Loan Pair May Be Adversely Affected by the Rights of the Related Directing Holder” and “Description of the Mortgage Pool—The A/B Whole Loans and the Loan Pairs” in the Free Writing Prospectus.
     
Control Eligible Certificates:
  
The “Control Eligible Certificates” will be the Class F, Class G and Class H Certificates.
     
Controlling Class
Representative/ Controlling
Class:
  
The controlling class representative will be the representative appointed by more than 50% of the Controlling Class (by certificate principal balance). The “Controlling Class” will be the most subordinate class of Control Eligible Certificates then outstanding that has an aggregate certificate principal balance (taking into account the application of any appraisal reductions to notionally reduce the aggregate certificate principal balance of such class) at least equal to 25% of the initial aggregate certificate principal balance of such class; provided that if no class of Control Eligible Certificates has an aggregate certificate principal balance (taking into account the application of any appraisal reductions to notionally reduce the aggregate certificate principal balance of such class) at least equal to 25% of the initial aggregate certificate principal balance of such class, then the Controlling Class will be the most senior class of Control Eligible Certificates. A summary of the consent and consultation rights of the controlling class representative, and the limitations thereon, is set forth above under “Control Rights”. The Controlling Class on the closing date will be the Class H Certificates.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-10
 
 
MSC 2012-C4
 Structural Overview
 
   
The initial controlling class representative will be BlackRock Financial Management Inc., as manager for one or more managed funds or accounts.
     
Appraised-Out Class:
  
Any class of Control Eligible Certificates, the aggregate certificate principal balance of which (taking into account the application of any appraisal reductions to notionally reduce the aggregate certificate principal balance of such class) has been reduced to less than 25% of its initial aggregate certificate principal balance, is referred to as an “Appraised-Out Class”.
     
Appraisal Remedy:
  
The holders of the majority (by certificate principal balance) of an Appraised-Out Class will have the right, at their sole expense, to present to the special servicer a second appraisal of any mortgage loan for which an Appraisal Event has occurred prepared by an MAI appraiser on an “as-is” basis acceptable to the special servicer in accordance with the Servicing Standard. Upon receipt of such second appraisal, the special servicer will be required to determine, in accordance with the Servicing Standard, whether, based on its assessment of such second appraisal, any recalculation of the applicable appraisal reduction is warranted and, if so warranted, will recalculate such appraisal reduction based upon such second appraisal. If required by any such recalculation, any applicable Appraised-Out Class will have its related certificate principal balance notionally restored to the extent required by such recalculation of the appraisal reduction, and there will be a redetermination of whether a Subordinate Control Period, a Collective Consultation Period or a Senior Consultation Period is then in effect. However, until an Appraised-Out Class is restored as the Controlling Class, the next most senior class of Control Eligible Certificates that is not an Appraised-Out Class (or, if all classes of Control Eligible Certificates are Appraised-Out Classes, the most senior class of Control Eligible Certificates), if any, will be the Controlling Class. The right of any Appraised-Out Class to present a second appraisal of any mortgage loan for which an Appraisal Event has occurred is limited to one appraisal with respect to each mortgaged property relating to the affected mortgage loan, subject to certain exceptions regarding a material change in circumstance.
     
Sale of Defaulted Loans and
REO Properties:
  
The special servicer will be required to solicit offers for defaulted mortgage loans and accept the first (and, if multiple bids are contemporaneously received, the highest) cash bid from any person that constitutes a fair price for the defaulted mortgage loan, determined as described in “Servicing of the Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties—Sale of Defaulted Mortgage Loans” in the Free Writing Prospectus, unless the special servicer determines, in accordance with the Servicing Standard, that rejection of such offer would be in the best interests of the certificateholders (as a collective whole), subject to (i) with respect to any mortgage loan that is part of an A/B whole loan or loan pair or any mortgage loan with existing mezzanine debt, to the extent set forth in the related intercreditor agreement, the right of the holder of the related debt held outside the issuing entity to purchase the related mortgage loan and (ii) any consent or consultation rights of the controlling class representative or, with respect to any mortgage loan that is part of an A/B whole loan or loan pair, the related directing holder, to the extent set forth in the related intercreditor agreement. See “Description of the Mortgage Pool—The A/B Whole Loan and the Loan Pair” in the Free Writing Prospectus.
 
If title to any REO property is acquired by the issuing entity in respect of any specially serviced mortgage loan, the special servicer is required to use its reasonable best efforts to sell the REO property for cash as soon as practicable consistent with the requirement to maximize proceeds for all certificateholders (and, with respect to a serviced companion loan or a B note, for the certificateholders and the holders of such loans, as a collective whole) but in no event later than three (3) years after the end of the year in which it was acquired, and in any event prior to the rated final distribution date or earlier to the extent necessary to comply with REMIC provisions, unless (i) the trustee or the special servicer has been granted an extension of time by the IRS or is permitted under the REMIC
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-11
 
 
MSC 2012-C4
 Structural Overview
 
    provisions to continue to hold such REO property during the period in which an application for an extension is pending or (ii) the special servicer receives an opinion of counsel that holding such REO property beyond the period specified above will not result in the imposition of taxes on “prohibited transactions” under the REMIC provisions or cause any REMIC to fail to qualify as a REMIC; provided, that in no event may the issuing entity hold any REO property beyond the end of the sixth (6th) calendar year following the end of the year of such REO property’s acquisition. If the special servicer is unable to sell such REO property for cash within such time period (as it may be extended as described above), the special servicer will be required, after consultation with the controlling class representative during any Subordinate Control Period and any Collective Consultation Period and, in the case of a sale of any REO property relating to an A/B whole loan or loan pair, the related directing holder to the extent set forth in the related intercreditor agreement, to auction the REO property to the highest bidder (which may be the special servicer or another Interested Person) in accordance with the Servicing Standard. See “Servicing of the Mortgage Loans—Sale of Defaulted Mortgage Loans and REO Properties—Sale of REO Properties” and “Description of the Mortgage Pool—The A/B Whole Loans and the Loan Pairs” in the Free Writing Prospectus.
       
Appointment and Termination
of Special Servicer:
  
The controlling class representative will appoint the initial special servicer. During any Subordinate Control Period, the special servicer may be replaced at any time by the controlling class representative. During any Collective Consultation Period and any Senior Consultation Period, the special servicer will be subject to termination without cause if certificateholders evidencing not less than 25% of voting rights request a vote of certificateholders to replace the special servicer. The certificate administrator would present the proposal to all certificateholders and replacement would be conditioned on receipt, within one hundred eighty (180) days thereafter, of approval of the termination from holders of 75% of the voting rights of the certificates. The holders initiating such vote will be responsible for the fees and expenses of the issuing entity in connection with the replacement.
 
During any Senior Consultation Period, if the trust advisor determines that the special servicer is not performing its duties in accordance with the Servicing Standard, the trust advisor will have the right to recommend the replacement of the special servicer. The trust advisor’s recommendation to replace the special servicer must be confirmed by an affirmative vote of holders of a majority of the voting rights of the principal balance certificates.
 
In addition, if any mortgage loan is part of an A/B whole loan or loan pair, to the extent set forth in the related intercreditor agreement, the related directing holder will have the right to replace the special servicer, with respect to the related A/B whole loan or loan pair as further described in the Free Writing Prospectus under “Description of the Mortgage Pool—The A/B Whole Loans and the Loan Pairs”.
       
Servicing Standard:
  
Each of the master servicer and the special servicer is obligated to service and administer the mortgage loans (and, if applicable, the related B notes and serviced companion loans) for which it is responsible pursuant to the pooling and servicing agreement on behalf of the trustee and in the best interests of and for the benefit of the certificateholders (and, with respect to any mortgage loan that is part of an A/B whole loan or loan pair, the holder of the related B note or serviced companion loan, as applicable) as a collective whole (as determined by the master servicer or the special servicer, as the case may be, in its good faith and reasonable judgment), in accordance with applicable law (and in the case of the mortgage loan secured by the mortgaged property identified on Appendix I to the Free Writing Prospectus as Ty Warner Hotels & Resorts Portfolio, the law of Mexico), the terms of the pooling and servicing agreement, the terms of the respective mortgage loans and, if applicable, any related intercreditor agreement and, to the extent consistent with the foregoing, further as follows.
       
    ● With the same care, skill and diligence as is normal and usual in its general
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-12
 
 
MSC 2012-C4
 Structural Overview
 
      mortgage servicing and REO property management activities on behalf of third parties or on behalf of itself, whichever is higher, with respect to mortgage loans and REO properties that are comparable to those for which it is responsible under the pooling and servicing agreement;
       
    ● With a view to the timely collection of all scheduled payments of principal and interest under the mortgage loans and any related B note or serviced companion loan or, if a mortgage loan or the related B note or serviced companion loan comes into and continues in default and with respect to the special servicer, if, in the good faith and reasonable judgment of the special servicer, no satisfactory arrangements can be made for the collection of the delinquent payments, the maximization of the recovery of principal and interest on such mortgage loan to the certificateholders (as a collective whole) (or in the case of any A/B whole loan or loan pair, the maximization of recovery thereon of principal and interest to the certificateholders and the holder of the related B note (taking into account the subordinate nature of any such B note) or serviced companion loan, as applicable, all taken as a collective whole) on a net present value basis; and
       
    ●
Without regard to various specified circumstances that could give rise to conflicts of interest.
       
Defaulted Mortgage
Loan Waterfall:
  
Amounts received by the issuing entity in respect of defaulted mortgage loans in connection with liquidation of any mortgage loan, net of unreimbursed advances and interest thereon, servicing compensation, and other amounts payable or reimbursable therefrom, will be applied so that amounts allocated as a recovery of accrued and unpaid interest will not, in the first instance, include any amount by which the interest portion of P&I advances previously made was reduced as a result of appraisal reductions. After the adjusted interest amount is so allocated, any remaining net proceeds will be allocated to pay principal on the mortgage loan until the unpaid principal amount of the mortgage loan has been reduced to zero. Any remaining proceeds would then be allocated as a recovery of accrued and unpaid interest corresponding to the amount by which the interest portion of P&I advances previously made was reduced as a result of appraisal reductions.
       
Trust Advisor:
  
Pacific Life Insurance Company, a Nebraska corporation, will act as the trust advisor. The trust advisor will be required to promptly review all information available to certain privileged persons on the certificate administrator’s website related to any specially serviced mortgage loan or REO property and each asset status report with respect to specially serviced mortgage loans (provided that during any Subordinate Control Period, the trust advisor may only review final asset status reports).
 
During any Collective Consultation Period and any Senior Consultation Period, within sixty (60) days after the end of each calendar year during which any mortgage loan was a specially serviced mortgage loan or any mortgaged property was an REO property, the trust advisor will be required to meet with representatives of the special servicer to review certain operational practices of the special servicer related to specially serviced mortgage loans and REO properties.
 
In addition, during any Collective Consultation Period and any Senior Consultation Period, based on (i) the trust advisor’s annual meeting with the special servicer and (ii) the trust advisor’s review of any asset status reports and other information delivered to the trust advisor by the special servicer and any other information available to certain privileged persons on the certificate administrator’s website, the trust advisor will be required to prepare an annual report to be provided to the certificate administrator (and to be made available through the certificate administrator’s website) setting forth its assessment of the special servicer’s performance of its duties under the pooling and servicing agreement during the prior calendar year on a platform-level basis with respect to the resolution and liquidation of specially serviced mortgage loans and REO properties. No such annual report will be required to be prepared or delivered with respect to any
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-13
 
 
MSC 2012-C4
 Structural Overview
 
   
calendar year during which no annual meeting has occurred or any calendar year during which no asset status reports have been prepared in connection with a specially serviced mortgage loan or REO property.
 
Furthermore, during any Collective Consultation Period and any Senior Consultation Period, the special servicer will be required to consult (on a non-binding basis) with the trust advisor in connection with certain major decisions involving any mortgage loan, A/B whole loan, loan pair or any related REO property to the extent described in this Term Sheet, the Free Writing Prospectus and the Pooling and Servicing Agreement; provided that, with respect to matters relating to any A/B whole loan or loan pair, the special servicer will only be required to consult with the trust advisor with regard to such matters after the holder of the related B note or serviced companion loan, as applicable, is no longer the directing holder with respect to such A/B whole loan or loan pair pursuant to the terms of the applicable intercreditor agreement.
 
During any Subordinate Control Period, there will be no annual meeting or annual report, the trust advisor will not be permitted to consult or consent with regard to any particular servicing actions, and the trust advisor will not distribute any report based on its review or otherwise opine on the activities of the special servicer with respect to any transaction.
       
Trust Advisor Expenses:
  
The trust advisor will be entitled, on each distribution date, to reimbursement for any trust advisor expenses, including unreimbursed indemnification amounts and other expenses (other than trust advisor fees) payable to the trust advisor pursuant to the terms of the pooling and servicing agreement. No trust advisor expenses will be allocated to or otherwise borne by the Control Eligible Certificates, and all trust advisor expenses will be allocated to reduce amounts due and owing to certain classes of the non-Control Eligible Certificates as described in the Free Writing Prospectus and above in this Term Sheet.
       
Termination and Replacement
of Trust Advisor:
  
If the holders of at least 25% of the voting rights of the certificates request a vote to terminate and/or replace the trust advisor, then the holders of at least 75% of the voting rights of the certificates may vote to either (i) terminate all rights and obligations of the trust advisor under the pooling and servicing Agreement and replace the trust advisor, or (ii) terminate all rights and obligations of the trust advisor and not appoint a replacement trust advisor, until such time as the holders of at least 75% of the voting rights of the certificates agree to the appointment of a replacement trust advisor. During any Subordinate Control Period and any Collective Consultation Period, the controlling class representative will have the right to consent, such consent not to be unreasonably withheld, to any replacement trust advisor; provided, that such consent will be deemed granted if no objection is made within ten (10) business days following the controlling class representative’s receipt of the request for consent. See “Servicing of the Mortgage Loans—The Trust Advisor—Termination of the Trust Advisor Without Cause” in the Free Writing Prospectus.
       
Deal Website:
  
The certificate administrator will be required to maintain a deal website which will include, among other items, (i) distribution date statements, (ii) CREFC reports, (iii) summaries of final asset status reports, (iv) inspection reports, (v) appraisals, (vi) various special notices described in the Free Writing Prospectus, (vii) the “Investor Q&A Forum” and (viii) a voluntary “Investor Registry.”  Investors may access the deal website following execution of an investor certification as described in the Free Writing Prospectus.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-14
 
 
MSC 2012-C4                                                                                  Collateral Overview
 
Mortgage Loan Sellers
 
 
No. of
Mortgage
Loans
No. of
Mortgaged
Properties
Aggregate
Cut-off Date
Balance
% of
Pool(1)
Morgan Stanley Mortgage Capital Holdings LLC
26
54
$767,814,062
69.9%
Bank of America, National Association
11
20
$231,130,332
21.0%
Bank of America, National Association /
Morgan Stanley Mortgage Capital Holdings LLC
1
 
3
 
$99,751,207
 
9.1%
 
Total:
38
77
$1,098,695,600
100.0%
 
Pool
   
Aggregate Cut-off Date Balance:
$1,098,695,600
Number of Mortgage Loans:
38
Average Cut-off Date Balance per Mortgage Loan:
$28,913,042
Number of Mortgaged Properties:
77
Average Cut-off Date Balance per Mortgaged Property:
$14,268,774
Weighted Average Mortgage Rate:
5.554%
% of Pool Secured by 5 Largest Mortgage Loans:
39.5%
% of Pool Secured by 10 Largest Mortgage Loans:
62.7%
% of Pool Secured by ARD Loans:
12.8%
Weighted Average Original Term to Maturity/ARD (months):
107
Weighted Average Remaining Term to Maturity/ARD (months):
104
Weighted Average Seasoning (months):
2
% of Pool Secured by Single Tenant Mortgaged Properties:
15.5%
 
Additional Debt
   
% of Pool with Pari Passu Mortgage Debt:
0.0%
% of Pool with Subordinate Mortgage Debt:
0.0%
% of Pool with Mezzanine Debt:
11.4%
 
Credit Statistics
   
Weighted Average UW NOI DSCR:
1.80x
Weighted Average UW NOI Debt Yield:
12.7%
Weighted Average UW NCF DSCR:
1.66x
Weighted Average UW NCF Debt Yield:
11.6%
Weighted Average Cut-off Date LTV Ratio:
58.4%
Weighted Average LTV Ratio at Maturity/ARD:
49.7%
 
(1)
Unless otherwise indicated, all references to “% of Pool” in this Term Sheet reflects a percentage of the aggregate principal balance of the mortgage pool as of the Cut-off Date, after application of all payments of principal due during or prior to March 2012.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-15
 
 
MSC 2012-C4                                                                                  Collateral Overview
 
 
 
Amortization      
% of
Pool(1)
Weighted Average Original Amortization Term (months):
348
Weighted Average Remaining Amortization Term (months):
346
% of Pool Amortizing Balloon:
79.9%
% of Pool Interest Only followed by Amortizing Balloon:
19.5%
% of Pool Interest Only through Maturity/ARD:
0.6%
 
Lockboxes
   
% of Pool with Hard Lockboxes
88.3%
% of Pool with Soft Lockboxes
10.1%
% of Pool with Springing Lockboxes
0.7%
% of Pool with No Lockboxes
0.9%
 
Reserves
   
% of Pool Requiring Tax Reserves:
57.7%
% of Pool Requiring Insurance Reserves:
9.3%
% of Pool Requiring Replacement Reserves:
51.9%
% of Pool Requiring TI/LC Reserves(2):
84.1%
 
Call Protection
   
% of Pool with lockout period, followed by defeasance until open period:
78.3%
% of Pool with the greater of a prepayment premium and yield maintenance, followed  by defeasance or the greater of a prepayment premium and yield maintenance until open period:
15.1%
% of Pool with greater of a prepayment premium or yield maintenance until open period:
4.3%
% of Pool with lockout period, followed by defeasance or the greater of a prepayment premium or yield maintenance until open period:
2.3%
 
(1)
Unless otherwise indicated, all references to “% of Pool” in this Term Sheet reflects a percentage of the aggregate principal balance of the mortgage pool as of the Cut-off Date, after application of all payments of principal due during or prior to March 2012.
 
(2)
Based only on mortgage loans secured by retail, office and industrial properties.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-16
 
 
MSC 2012-C4 Characteristics of the Mortgage Loans
 
Top 10 Mortgage Loans
  
                             
Loan
No.
Mortgage
Loan
Seller
Property Name
City
State
Property
Type
Cut-off Date
Balance
% of
Pool
  NSF/Units
Cut-off Date
Balance
PSF/Unit
U/W NCF
DSCR
U/W NOI
Debt Yield
Cut-off
Date LTV
Balloon
LTV
  
1
MSMCH
Shoppes at Buckland Hills
Manchester
CT
Retail
$130,000,000
11.8%
535,235
$242.88
1.44x
9.8%
68.8%
57.0%
  
2
BANA/MSMCH
Ty Warner Hotels & Resorts Portfolio
Various
Various
Hospitality
$99,751,207
9.1%
319
$312,699.71
2.69x
24.8%
21.8%
20.6%
  
3
MSMCH
50 Central Park South
New York
NY
Commercial Condo.
$75,000,000
6.8%
234,324
$320.07
1.33x
8.7%
62.5%
59.9%
  
4
BANA
Capital City Mall
Camp Hill
PA
Retail
$65,750,000
6.0%
488,769
$134.52
1.55x
11.3%
62.6%
52.1%
  
5
MSMCH
ELS Portfolio
Various
Various
Manufactured Housing
$63,747,000
5.8%
2,843
$22,422.44
2.44x
16.5%
41.2%
35.8%
  
6
MSMCH
9 MetroTech Center
Brooklyn
NY
Office
$62,896,233
5.7%
316,942
$198.45
1.12x
10.1%
55.5%
42.9%
  
7
MSMCH
GPB Portfolio 2
Various
Various
Retail
$62,428,188
5.7%
702,779
$88.83
1.41x
10.8%
57.8%
45.4%
  
8
MSMCH
GPB Portfolio 1
Various
Various
Retail
$62,113,118
5.7%
516,585
$120.24
1.66x
11.7%
60.5%
50.8%
  
9
MSMCH
Midtown Square Shopping Center
Troy
MI
Retail
$34,956,343
3.2%
193,301
$180.84
1.38x
10.0%
73.6%
61.7%
  
10
BANA
United HealthCare Services
Eden Prairie
MN
Office
$32,500,000
3.0%
473,325
$68.66
1.53x
10.0%
65.0%
59.9%
  
   
Total/Weighted Avg.
      
$689,142,090
62.7%
    
1.70x
12.9%
55.3%
47.1%
  
 
Mortgage Loans with Subordinate Debt
    Loan   
    No.
Mortgage
Loan
Seller
Property Name
Cut-off Date
  Mortgage Loan
Balance
  Cut-off Date
Loan per
Unit/SF
  UW NCF
DSCR
  UW NOI
Debt
Yield
  Cut-off
Date
LTV
Ratio
 Cut-off Date
  Subordinate
Mortgage
Debt
Balance
  Cut-off Date
Mezzanine
Debt
Balance
  Cut-off Date
Total Debt
Loan per
Unit/SF
  Total Debt
UW NCF
DSCR
Total Debt
UW NOI
Debt Yield
Total Debt
Cut-off
Date LTV
Ratio
    2
 BANA/MSMCH 
    Ty Warner Hotels & Resorts Portfolio
$99,751,207
$312,699.71
2.69x
24.8%
21.8%
NAP
$80,000,000
$563,483.41
1.29x
13.8%
39.2%
    23
MSMCH
    Magellan Storage - Costa Mesa
$13,671,876
$80.80
1.45x
10.4%
64.2%
NAP
$3,000,000
$98.53
1.08x
8.5%
78.3%
    26
MSMCH
    Holiday Inn San Diego Downtown
$12,309,463
$55,952.11
1.82x
14.7%
62.2%
NAP
$2,625,000
$67,883.92
1.25x
12.1%
75.4%
  
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-17
 
 
MSC 2012-C4 Characteristics of the Mortgage Loans
 
Prior Securitization History(1)
  Loan
  No.
Mortgage
Loan
Seller
Property Name
City
State
Prop.
Type
Cut-off
Date Bal.
% of
Pool
NSF/
Units
Loan per
SF/Unit
  U/W NCF
  DSCR
U/W NOI
  Debt Yield
  Cut-off
Date
LTV
Mat.
Date
LTV
Prior Securitization
1
MSMCH
Shoppes at Buckland Hills
Manchester
CT
Retail
$130,000,000
11.8%
535,235
$242.88
1.44x
9.8%
68.8%
57.0%
JPMCC 2005-LDP3
2
BANA/MSMCH
Ty Warner Hotels & Resorts Portfolio
Various
Various
Hospitality
$99,751,207
9.1%
319
$312,699.71
2.69x
24.8%
21.8%
20.6%
TYHOT 2005-LUX
3
MSMCH
50 Central Park South
New York
NY
Commercial Condo.
$75,000,000
6.8%
234,324
$320.07
1.33x
8.7%
62.5%
59.9%
WBCMT 2003-C6
4
BANA
Capital City Mall
Camp Hill
PA
Retail
$65,750,000
6.0%
488,769
$134.52
1.55x
11.3%
62.6%
52.1%
BSCMS 2002-TOP6
5
MSMCH
ELS Portfolio
      
$63,747,000
5.8%
2,843
$22,422.44
2.44x
16.5%
41.2%
35.8%
  
5.1
MSMCH
ELS Portfolio - Royal Coachman
Nokomis
FL
Manufactured Housing
$11,898,000
  
546
          
DLJCM 2000-CF1
5.2
MSMCH
ELS Portfolio - Regency Lakes
Winchester
VA
Manufactured Housing
$9,887,000
  
523
          
JPMCC 2004-C1
5.3
MSMCH
ELS Portfolio - Parkwood Communities
Wildwood
FL
Manufactured Housing
$9,681,000
  
695
          
JPMCC 2004-C2
5.4
MSMCH
ELS Portfolio - Cabana
Las Vegas
NV
Manufactured Housing
$9,063,000
  
263
          
MSDWC 2001-TOP5
5.5
MSMCH
ELS Portfolio - Boulder Cascade
Las Vegas
NV
Manufactured Housing
$8,165,000
  
299
          
MSC 2004-HQ3
5.6
MSMCH
ELS Portfolio - Rancho Valley
El Cajon
CA
Manufactured Housing
$7,164,000
  
140
          
CMAC 1998-C2
5.7
MSMCH
ELS Portfolio - Palm Shadows
Glendale
AZ
Manufactured Housing
$5,994,000
  
294
          
MSC 2004-HQ3
5.8
MSMCH
ELS Portfolio - Hillcrest
Rockland
MA
Manufactured Housing
$1,895,000
  
83
          
JPMCC 2004-C1
7
MSMCH
GPB Portfolio 2
      
$62,428,188
5.7%
702,779
$88.83
1.41x
10.8%
57.8%
45.4%
  
7.1
MSMCH
GPB Portfolio 2 - Millburn King's Super
Millburn
NJ
Retail
$9,972,550
  
89,348
          
MSDWC 2002-TOP7
7.2
MSMCH
GPB Portfolio 2 - Swampscott CVS
Swampscott
MA
Retail
$9,410,323
  
57,570
          
MSDWC 2002-TOP7
7.3
MSMCH
GPB Portfolio 2 - Salem Staples
Salem
MA
Retail
$9,094,320
  
48,425
          
BSCMS 2003-T10
7.4
MSMCH
GPB Portfolio 2 - Danbury Walmart
Danbury
CT
Retail
$8,655,766
  
136,209
          
BSCMS 2003-T10
7.5
MSMCH
GPB Portfolio 2 - Woburn Kohl's
Woburn
MA
Retail
$6,448,663
  
119,378
          
BSCMS 2003-T10
7.6
MSMCH
GPB Portfolio 2 - Springfield CVS
Springfield
MA
Retail
$5,373,055
  
19,287
          
MSDWC 2003-HQ2
7.7
MSMCH
GPB Portfolio 2 - Worcester Savers
Worcester
MA
Retail
$4,216,702
  
66,281
          
MSDWC 2003-HQ2
7.10
MSMCH
GPB Portfolio 2 - Fall River Staples
Fall River
MA
Retail
$2,236,945
  
30,897
          
MSDWC 2003-HQ2
7.11
MSMCH
GPB Portfolio 2 - Chatham Ocean State
Chatham
MA
Retail
$1,410,552
  
24,432
          
BSCMS 2003-T10
8
MSMCH
GPB Portfolio 1
      
$62,113,118
  
516,585
$120.24
1.66x
11.7%
60.5%
50.8%
  
8.1
MSMCH
GPB Portfolio 1 - Cambridge Trader Joe's
Cambridge
MA
Retail
$16,303,585
  
62,555
          
MSDWC 2003-HQ2
8.2
MSMCH
GPB Portfolio 1 - Falmouth Staples
Falmouth
MA
Retail
$7,943,948
  
85,524
          
BSCMS 2003-T10
8.3
MSMCH
GPB Portfolio 1 - Hillsdale King's Super
Hillsdale
NJ
Retail
$6,739,745
  
60,428
          
MSDWC 2002-TOP7
8.4
MSMCH
GPB Portfolio 1 - Medford Aldi
Medford
MA
Retail
$6,019,018
  
56,215
          
MSDWC 2002-TOP7
8.5
MSMCH
GPB Portfolio 1 - Brighton Whole Foods
Brighton
MA
Retail
$5,912,355
  
27,550
          
MSDWC 2002-TOP7
8.6
MSMCH
GPB Portfolio 1 - Everett Walgreens
Everett
MA
Retail
$5,645,197
  
41,278
          
MSDWC 2003-HQ2
8.8
MSMCH
GPB Portfolio 1 - Waltham CVS / Petco
Waltham
MA
Retail
$3,525,881
  
24,284
          
MSDWC 2003-HQ2
8.9
MSMCH
GPB Portfolio 1 - Revere Walgreens
Revere
MA
Retail
$2,869,949
  
15,272
          
MSDWC 2003-HQ2
8.10
MSMCH
GPB Portfolio 1 - Quincy Walgreens
Quincy
MA
Retail
$1,870,102
  
25,495
          
MSDWC 2002-TOP7
8.11
MSMCH
GPB Portfolio 1 - Wakefield Mike's Gym
Wakefield
MA
Retail
$897,171
  
15,984
          
BSCMS 2003-T10
9
MSMCH
Midtown Square Shopping Center
Troy
MI
Retail
$34,956,343
3.2%
193,301
$180.84
1.38x
10.0%
73.6%
61.7%
MSDWC 2002-TOP7
12
BANA
Forest Hills Village
Loves Park, Machesney Park
IL
Manufactured Housing
$30,055,000
2.7%
963
$31,209.76
1.43x
9.3%
73.1%
60.2%
JPMCC 2007 CB20
  
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.

 
T-18
 
 
MSC 2012-C4 Characteristics of the Mortgage Loans
 
Prior Securitization History(1)
  Loan
  No.
Mortgage
Loan
Seller
Property Name
City
State
Prop.
Type
Cut-off
Date Bal.
% of
Pool
NSF/
Units
Loan per
SF/Unit
  U/W NCF
  DSCR
U/W NOI
  Debt Yield
  Cut-off
Date
LTV
Mat.
Date
LTV
Prior Securitization
14
MSMCH
Sirata Beach Resort
St. Pete Beach
FL
Hospitality
$28,000,000
2.5%
382
$73,298.43
1.83x
16.4%
48.3%
43.6%
LBUBS 2004-C4
15
MSMCH
Hilton Springfield
Springfield
VA
Hospitality
$25,900,000
2.4%
245
$105,714.29
1.61x
14.1%
52.9%
40.8%
GMACC 2002-C2
16
BANA
U-Haul 2011 Portfolio
Various
Various
Self Storage
$25,000,000
2.3%
375,593
$66.56
1.75x
12.7%
69.2%
58.5%
LBUBS 2002-C1
17
MSMCH
Independence Hill Independent Living
San Antonio
TX
Multifamily
$22,000,000
2.0%
292
$75,342.47
1.70x
12.3%
58.1%
49.1%
GNR 2006-39
30
BANA
Norwalk Self Storage
Norwalk
CA
Self Storage
$9,300,000
0.8%
105,744
$87.95
1.66x
11.0%
63.3%
52.3%
GSMS 2007-GG10
31
MSMCH
Holiday Inn Express Arlington
Arlington
TX
Hospitality
$7,728,929
0.7%
103
$75,038.14
1.57x
14.0%
58.6%
46.2%
MLMI 1998-C2
32
MSMCH
Brookwood Village Shopping Center
Atlanta
GA
Retail
$7,340,700
0.7%
28,774
$255.12
1.28x
9.0%
69.3%
57.9%
BSCMS 2005-PWR8
35
BANA
Rego Park Retail
Rego Park
NY
Retail
$4,232,601
0.4%
34,150
$123.94
2.91x
21.7%
28.0%
23.7%
MLMT 2002-MW1
37
BANA
West Alameda Self Storage
Lakewood
CO
Self Storage
$3,284,528
0.3%
86,575
$37.94
1.94x
14.4%
54.7%
46.7%
GECMC 2001-3
   
Total
    
$756,587,614
68.9%
              
 
(1)
The table above describes the most recent securitization with respect to the mortgaged property securing the related mortgage loan, based on information provided by the related borrower or obtained through TREPP and Bloomberg searches.
 
Mortgage Loans with Scheduled Balloon Payments and Related Classes(1)
 
Class A-2 ($244,709,000)
Loan
No.
Mortgage
Loan
Seller
Property Name
State
Property
Type
Cut-off Date
Balance
% of
Pool
Balance at
Maturity
% of
Class A-2
Certificate
Principal
Balance
NSF/
Units
Loan per
SF/
Unit
UW
NCF
DSCR
UW
NOI
Debt
Yield
Cut-off
Date
LTV
Ratio
LTV
Ratio at
Maturity
Rem. IO
Period
(mos.)
Rem.
Term to
Maturity
(mos.)
2
BANA
Ty Warner Hotels & Resorts Portfolio
Various
Hospitality
$99,751,207
9.1%
$94,406,745
38.6%
319
$312,699.71
2.69x
24.8%
21.8%
20.6%
0
57
3
MSMCH
50 Central Park South
NY
Comm. Condo.
$75,000,000
6.8%
$71,859,541
29.4%
234,324
$320.07
1.33x
8.7%
62.5%
59.9%
19
55
14
MSMCH
Sirata Beach Resort
FL
Hospitality
$28,000,000
2.5%
$25,302,095
10.3%
382
$73,298.43
1.83x
16.4%
48.3%
43.6%
0
60
23
MSMCH
Magellan Storage - Costa Mesa
CA
Self Storage
$13,671,876
1.2%
$12,807,898
5.2%
169,214
$80.80
1.45x
10.4%
64.2%
60.1%
0
58
24
MSMCH
67 Livingston Street
NY
Multifamily
$13,000,000
1.2%
$12,676,016
5.2%
75
$173,333.33
1.51x
10.5%
68.4%
66.7%
35
59
26
MSMCH
Holiday Inn San Diego Downtown
CA
Hospitality
$12,309,463
1.1%
$11,537,838
4.7%
220
$55,952.11
1.82x
14.7%
62.2%
58.3%
0
53
33
MSMCH
Old Town Plaza Office
CA
Office
$6,975,000
0.6%
$6,975,000
2.9%
60,490
$115.31
1.62x
10.8%
64.0%
64.0%
54
54
   
Total / Wtd. Avg.
    
$248,707,546
22.6%
$235,565,132
96.3%
    
1.98x
16.5%
45.0%
42.7%
9
57
 
(1)
The table above reflects the mortgage loans whose balloon payments will be applied to pay down the Class A-2 Certificates, assuming (i) that none of the mortgage loans experience prepayments, defaults or losses; (ii) there are no extensions of maturity dates; and (iii) each mortgage loan is paid in full on its stated maturity date or, in the case of the mortgage loan with an anticipated repayment date, on such anticipated repayment date. The table above is otherwise based on the Structuring Assumptions set forth under “Yield, Prepayment and Maturity Considerations” in the Free Writing Prospectus.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-19
 
 
MSC 2012-C4 Characteristics of the Mortgage Loans
 
(PIA CHART)
 
Property Type Distribution
  
Property Type
Number of
Mortgaged
Properties
Aggregate
Cut-off Date
Balance
% of
Pool
Wtd. Avg.
Mortgage
Rate
Wtd. Avg.
UW NCF
DSCR
Wtd. Avg.
UW NOI
Debt Yield
Wtd. Avg.
Cut-off Date LTV Ratio
Wtd. Avg.
LTV Ratio at Maturity/ARD
  
Retail
36
  $464,445,980
42.3%
5.432%
1.48x
10.7%
65.2%
54.1%
  
Anchored
28
230,320,100
21.0%
5.553%
1.48x
11.0%
64.1%
53.0%
  
Super Regional Mall
1
130,000,000
11.8%
5.190%
1.44x
9.8%
68.8%
57.0%
  
Regional Mall
1
65,750,000
6.0%
5.296%
1.55x
11.3%
62.6%
52.1%
  
Unanchored
6
38,375,880
3.5%
5.756%
1.49x
11.1%
64.6%
54.7%
  
Hospitality
9
$189,144,770
17.2%
6.241%
2.25x
20.4%
37.6%
32.7%
  
Full Service
6
165,960,670
15.1%
6.255%
2.31x
21.0%
34.1%
30.4%
  
Limited Service
2
15,306,948
1.4%
6.202%
1.74x
15.7%
61.6%
48.3%
  
Extended Stay
1
7,877,152
0.7%
6.000%
1.91x
17.4%
64.7%
50.4%
  
Office
6
$158,265,421
14.4%
5.441%
1.44x
10.9%
60.3%
51.8%
  
Suburban
3
71,957,464
6.5%
4.964%
1.70x
11.7%
62.3%
57.0%
  
Urban
2
69,871,233
6.4%
5.799%
1.17x
10.1%
56.3%
45.0%
  
Medical
1
16,436,723
1.5%
6.010%
1.43x
11.1%
68.1%
58.1%
  
Manufactured Housing
9
$93,802,000
8.5%
5.188%
2.12x
14.2%
51.4%
43.7%
  
Commercial Condominium
1
75,000,000
6.8%
5.120%
1.33x
8.7%
62.5%
59.9%
  
Multifamily
3
$55,800,000
5.1%
5.659%
1.52x
11.3%
64.2%
54.3%
  
Senior Housing
1
22,000,000
2.0%
5.790%
1.70x
12.3%
58.1%
49.1%
  
Garden/Military Housing
1
20,800,000
1.9%
5.620%
1.34x
10.7%
68.0%
52.2%
  
Student Housing
1
13,000,000
1.2%
5.500%
1.51x
10.5%
68.4%
66.7%
  
Self Storage
12
$51,256,403
4.7%
5.685%
1.67x
11.9%
65.9%
57.0%
  
Industrial
1
$10,981,025
1.0%
5.430%
1.41x
11.8%
66.0%
50.3%
  
Flex Industrial
1
10,981,025
1.0%
5.430%
1.41x
11.8%
66.0%
50.3%
  
Total / Wtd. Avg.
77
1,098,695,600
100.0%
5.554%
1.66x
12.7%
58.4%
49.7%
  
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-20
 
 
MSC 2012-C4 Characteristics of the Mortgage Loans
 
(MAP)
 
Geographic Distribution
State
Number of
Mortgaged
Properties
Aggregate
Cut-off Date
Balance
% of
Pool
Wtd. Avg.
Mortgage
Rate
Wtd. Avg.
UW NCF
DSCR
Wtd. Avg.
UW NOI
Debt Yield
Wtd. Avg.
Cut-off Date
LTV Ratio
Wtd. Avg. LTV Ratio at Maturity/ARD
New York
5
164,755,003
15.0%
5.439%
1.30x
9.7%
60.0%
53.1%
California
10
163,704,663
14.9%
5.891%
2.08x
17.1%
46.8%
42.8%
California - Southern
9
147,267,939
13.4%
5.878%
2.16x
17.8%
44.5%
41.0%
California - Northern
1
16,436,723
1.5%
6.010%
1.43x
11.1%
68.1%
58.1%
Connecticut
2
138,655,766
12.6%
5.209%
1.43x
9.9%
68.1%
56.3%
Massachusetts
20
101,068,244
9.2%
5.496%
1.56x
11.4%
59.0%
48.2%
Texas
8
91,972,132
8.4%
5.932%
1.69x
13.5%
62.5%
52.0%
Florida
5
68,240,205
6.2%
5.440%
1.97x
15.2%
51.1%
44.4%
Pennsylvania
1
65,750,000
6.0%
5.296%
1.55x
11.3%
62.6%
52.1%
Virginia
3
37,397,000
3.4%
5.648%
1.83x
14.7%
50.5%
40.2%
Michigan
1
34,956,343
3.2%
5.500%
1.38x
10.0%
73.6%
61.7%
Mexico
1
34,638,607
3.2%
6.600%
2.69x
24.8%
21.8%
20.6%
Minnesota
1
32,500,000
3.0%
4.857%
1.53x
10.0%
65.0%
59.9%
Illinois
1
30,055,000
2.7%
4.990%
1.43x
9.3%
73.1%
60.2%
New Jersey
4
28,803,321
2.6%
5.484%
1.48x
11.5%
62.0%
49.1%
Colorado
2
23,465,792
2.1%
5.854%
1.39x
10.3%
64.8%
54.9%
Tennessee
1
20,800,000
1.9%
5.620%
1.34x
10.7%
68.0%
52.2%
Nevada
2
17,228,000
1.6%
5.282%
2.44x
16.5%
41.2%
35.8%
Kansas
3
16,299,765
1.5%
5.922%
1.35x
10.9%
66.5%
56.6%
Georgia
2
14,760,700
1.3%
5.589%
1.52x
10.8%
69.2%
58.2%
Arizona
2
7,754,000
0.7%
5.394%
2.28x
15.6%
47.6%
41.0%
Rhode Island
1
3,360,000
0.3%
5.775%
1.75x
12.7%
69.2%
58.5%
North Carolina
1
1,861,060
0.2%
6.070%
1.38x
13.0%
64.2%
43.0%
Oregon
1
670,000
0.1%
5.775%
1.75x
12.7%
69.2%
58.5%
Total / Wtd. Avg.
77
$1,098,695,600
100.0%
5.554%
1.66x
12.7%
58.4%
49.7%
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-21
 
 
MSC 2012-C4
 Collateral Statistics
 
Collateral Statistics(1)
 
Cut-off Date Balance ($)
  
Mortgage Rate (%)
  
Cut-off Date LTV Ratio (%)
 
No. of
Mortgage
Loans
Aggregate
Cut-off Date
Balance ($)
% of
Pool
    
No. of
Mortgage
Loans
Aggregate
Cut-off Date
Balance ($)
% of
Pool
    
No. of
Mortgage
Loans
Aggregate
Cut-off Date
Balance ($)
% of
Pool
1 - 10,000,000
11
$68,345,127
6.2
  
4.501 - 5.000
3
$92,055,000
8.4
  
20.1 - 30.0
2
103,983,808
9.5
10,000,001 - 20,000,000
8
$108,776,553
9.9
  
5.001 - 5.500
16
$585,170,676
53.3
  
40.1 - 50.0
3
101,704,464
9.3
20,000,001 - 30,000,000
7
$171,381,264
15.6
  
5.501 - 6.000
13
$261,257,762
23.8
  
50.1 - 60.0
6
184,237,878
16.8
30,000,001 - 40,000,000
4
$128,506,911
11.7
  
6.001 - 6.500
4
$57,022,280
5.2
  
60.1 - 70.0
22
599,697,695
54.6
60,000,001 - 70,000,000
5
$316,934,539
28.8
  
6.501 - 7.000
2
$103,189,883
9.4
  
70.1 - 80.0
5
109,071,755
9.9
70,000,001 - 80,000,000
1
$75,000,000
6.8
  
Total:
38
$1,098,695,600
100.0%
  
Total:
38
$1,098,695,600
100.0%
90,000,001 - 100,000,000
1
$99,751,207
9.1
  
Min: 4.857%
Max: 6.750%
Wtd Avg: 5.554
 %   
Min: 21.8%
Max: .74 8%
Wtd Avg: 58.4%
  
120,000,001 - 130,000,000
1
$130,000,000
11.8
        
Total:
38
$1,098,695,600
100.0%
  
Original Term to Maturity/ARD (mos.)
  
LTV Ratio at Maturity/ARD (%)
Min: $1,861,060
Max: $130,000,000
Avg: $28,913,042
                      
           
No. of
Aggregate
      
No. of
Aggregate
  
State
          
Mortgage
Cut-off Date
% of
    
Mortgage
Cut-off Date
% of
           
Loans
Balance ($)
Pool
    
Loans
Balance ($)
Pool
 
No. of
Aggregate
    
60
7
248,707,546
22.6
  
20.1 - 30.0
2
103,983,808
9.5
 
Mortgaged
Cut-off Date
% of
  
119
1
63,747,000
5.8
  
30.1 - 40.0
2
73,704,464
6.7
 
Properties
Balance ($)
Pool
  
120
29
766,059,791
69.7
  
40.1 - 50.0
8
214,098,937
19.5
New York
5
164,755,003
15.0
  
134
1
20,181,264
1.8
  
50.1 - 60.0
18
565,685,327
51.5
California
10
163,704,663
14.9
  
Total:
38
$1,098,695,600
100.0%
  
60.1 - 70.0
8
141,223,064
12.9
California-Southern(2)
9
147,267,939
13.4
  
Min: 60
Max: 134
Wtd Avg: 107
    
Total:
38
$1,098,695,600
100.0%
California-Northern(2)
1
16,436,723
1.5
            
Min: 20.6%
    Max: 66.7%
Wtd Avg: 49. 7%
  
Connecticut
2
138,655,766
12.6
  
Remaining Term to Maturity/ARD (mos.)
            
Massachusetts
20
101,068,244
9.2
            
UW DSCR (x)
Texas
8
91,972,132
8.4
    
No. of
Aggregate
            
Florida
5
68,240,205
6.2
    
Mortgage
Cut-off Date
% of
    
No. of
Aggregate
  
Pennsylvania
1
65,750,000
6.0
    
Loans
Balance ($)
Pool
    
Mortgage
Cut-off Date
% of
Virginia
3
37,397,000
3.4
  
49 - 54
2
19,284,463
1.8
    
Loans
Balance ($)
Pool
Michigan
1
34,956,343
3.2
  
55 - 60
5
229,423,083
20.9
  
1.11 - 1.20
1
62,896,233
5.7
Mexico
1
34,638,607
3.2
  
109 - 114
3
25,548,434
2.3
  
1.21 - 1.30
2
27,521,964
2.5
Minnesota
1
32,500,000
3.0
  
115 - 120
28
824,439,621
75.0
  
1.31 - 1.40
7
158,543,337
14.4
Illinois
1
30,055,000
2.7
  
Total:
38
$1,098,695,600
100.0%
  
1.41 - 1.50
8
299,168,380
27.2
New Jersey
4
28,803,321
2.6
  
Min: 53
Max: 120
Wtd Avg: 104
    
1.51 - 1.60
4
118,978,929
10.8
Colorado
2
23,465,792
2.1
            
1.61 - 1.70
6
140,349,323
12.8
Tennessee
1
20,800,000
1.9
  
Original Amortization Term (mos.)
    
1.71 - 1.80
2
54,500,000
5.0
Nevada
2
17,228,000
1.6
            
1.81 - 1.90
2
40,309,463
3.7
Kansas
3
16,299,765
1.5
    
No. of
Aggregate
    
1.91 - 2.00
2
18,739,699
1.7
Georgia
2
14,760,700
1.3
    
Mortgage
Cut-off Date
% of
  
2.21 - 2.30
1
9,957,464
0.9
Arizona
2
7,754,000
0.7
    
Loans
Balance ($)
Pool
  
2.41 - 2.50
1
63,747,000
5.8
Rhode Island
1
3,360,000
0.3
  
Interest Only
1
6,975,000
0.6
  
2.61 - 2.70
1
99,751,207
9.1
North Carolina
1
1,861,060
0.2
  
240
1
1,861,060
0.2
  
2.91 - 3.00
1
4,232,601
0.4
Oregon
1
670,000
0.1
  
300
7
171,761,358
15.6
  
Total:
38
$1,098,695,600
100.0%
Total:
77
$1,098,695,600
100.0%
  
313
1
62,428,188
5.7
  
Min: 1.12x
Max: 2.91x
Wtd Avg: 1.66x
  
         
360
28
855,669,995
77.9
          
Property Type
        
Total:
38
$1,098,695,600
100.0%
  
UW NOI Debt Yield (%)
         
Non-Zero Min: 240
Max: 360
Non-Zero Wtd Avg: 348
          
 
No. of
Aggregate
                
No. of
Aggregate
  
 
Mortgaged
Cut-off Date
% of
  
Remaining Amortization Term (mos.)
      
Mortgage
Cut-off Date
% of
 
Properties
Balance ($)
Pool
              
Loans
Balance ($)
Pool
Retail
36
464,445,980
42.3
    
No. of
Aggregate
    
8.6 - 9.0
1
75,000,000
6.8
Anchored
28
230,320,100
21.0
    
Mortgage
Cut-off Date
% of
  
9.1 - 9.5
3
47,021,869
4.3
Super Regional Mall
1
130,000,000
11.8
    
Loans
Balance ($)
Pool
  
9.6 - 10.0
4
189,737,607
17.3
Regional Mall
1
65,750,000
6.0
  
Interest Only
1
6,975,000
0.6
  
10.1 - 10.5
4
122,068,109
11.1
Unanchored
6
38,375,880
3.5
  
231 - 300
8
173,622,418
15.8
  
10.6 - 11.0
5
112,364,277
10.2
Hospitality
9
189,144,770
17.2
  
301 - 350
2
82,609,452
7.5
  
11.1 - 11.5
3
113,182,291
10.3
Full Service
6
165,960,670
15.1
  
351 - 360
27
835,488,731
76.0
  
11.6 - 12.0
4
106,032,819
9.7
Limited Service
2
15,306,948
1.4
  
Total:
38
$1,098,695,600
100.0%
  
12.1 - 12.5
1
22,000,000
2.0
Extended Stay
1
7,877,152
0.7
  
Non-Zero Min:  234
Max: 360
Non-Zero  Wtd Avg: 346
  
12.6 - 13.0
3
40,922,265
3.7
Office
6
158,265,421
14.4
            
13.6 - 14.0
1
7,728,929
0.7
Suburban
3
71,957,464
6.5
            
14.1 - 14.5
2
29,184,528
2.7
Urban
2
69,871,233
6.4
            
14.6 - 15.0
1
12,309,463
1.1
Medical
1
16,436,723
1.5
            
15.1 >=
6
221,143,444
20.1
Manufactured Housing
9
93,802,000
8.5
            
Total:
38
$1,098,695,600
100.0%
Commercial Condominium
1
75,000,000
6.8
            
Min: 8.7%
Max: 24.8%
Wtd Avg: 12.7%
  
Multifamily
3
55,800,000
5.1
                    
Senior Housing
1
22,000,000
2.0
                    
Garden/Military Housing
1
20,800,000
1.9
                    
Student Housing
1
13,000,000
1.2
                    
Self Storage
12
51,256,403
4.7
                    
Industrial
1
10,981,025
1.0
                    
Flex Industrial
1
10,981,025
1.0
                    
Total:
77
$1,098,695,600
100.0%
                    
 
(1)
All numerical information concerning the mortgage loans is approximate. All weighted average information regarding the mortgage loans reflects the weighting of the mortgage loans based on their outstanding principal balances as of the Cut-off Date. State and Property Type tables reflect allocated loan amounts in the case of mortgage loans secured by multiple properties. Original and Remaining Term to Maturity/ARD tables are based on the anticipated repayment dates for mortgage loans with anticipated repayment dates. The sum of numbers and percentages in columns may not match the “Total” due to rounding. Additionally, loan-to-value ratios and debt service coverage ratios are calculated for mortgage loans without regard to any additional indebtedness that may be incurred at a future date. With respect to Mortgage Loan No. 22, Horizon Park Shopping Center, the appraised value represents the “as-stabilized” value as of June 1, 2012, which is dependent on certain repairs to be made in year 1 of the loan term, most of which have been completed. As upfront escrows of $81,625 and $929,100 were taken for deferred maintenance and roof repairs, respectively, at closing, the “as-stabilized” value is utilized. The “as-is” value as of June 8, 2011 is $19,200,000.
 
(2)
“California-Northern” includes zip codes above 93600, and “California-Southern” includes zip codes at or below 93600.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-22
 
 
MSC 2012-C4
 Collateral Statistics
 
Prepayment Restrictions
 
Percentage of Collateral by Prepayment Restrictions (%)(1)(2)(3)
 
Prepayment Restrictions
March 2012
March 2013
March 2014
March 2015
March 2016
Locked Out
80.6%
80.5%
78.2%
78.3%
78.3%
Greater of YM and 1.00%
19.4%
19.5%
21.8%
21.7%
21.7%
Open
0.0%
0.0%
0.0%
0.0%
0.0%
TOTALS
100.0%
100.0%
100.0%
100.0%
100.0%
Pool Balance Outstanding(4)
$1,098.7
$1,086.5
$1,072.8
$1,057.2
$1,040.7
% Initial Pool Balance
100.0%
98.9%
97.6%
96.2%
94.7%
           
Prepayment Restrictions
March 2017
March 2018
March 2019
March 2020
March 2021
Locked Out
88.2%
88.3%
88.3%
88.4%
84.7%
Greater of YM and 1.00%
11.8%
11.7%
11.7%
11.6%
11.6%
Open
0.0%
0.0%
0.0%
0.0%
3.7%
TOTALS
100.0%
100.0%
100.0%
100.0%
100.0%
Pool Balance Outstanding(4)
$788.9
$773.3
$756.8
$739.5
$721.1
% Initial Pool Balance
71.8%
70.4%
68.9%
67.3%
65.6%
 
(1)
The analysis is based on Structuring Assumptions and a 0% CPR as discussed in the Free Writing Prospectus.
 
(2)
See description of Yield Maintenance in the Free Writing Prospectus under “Description of the Offered Certificates—Distributions of Prepayment Premiums and Yield Maintenance Charges.”
 
(3)
Mortgage loans modeled as Yield Maintenance include mortgage loans characterized by DEF/YM1 on Appendix I to the Free Writing Prospectus.
 
(4)
Dollar amounts represent approximate amounts in millions.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-23
 
 
MSC 2012-C4
 The Shoppes at Buckland Hills
 
Mortgage Loan No. 1 – The Shoppes at Buckland Hills
 
(PHOTO)
 
        
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-24
 
 
MSC 2012-C4
 The Shoppes at Buckland Hills
 
Mortgage Loan No. 1 – The Shoppes at Buckland Hills
 
(PHOTO)
 
                 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-25
 
 
MSC 2012-C4
 The Shoppes at Buckland Hills
 
Mortgage Loan No. 1 – The Shoppes at Buckland Hills
 
(MAP)
 
                            
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-26
 
 
MSC 2012-C4
  The Shoppes at Buckland Hills
 
Mortgage Loan No. 1 – The Shoppes at Buckland Hills
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
 
194 Buckland Hills Drive,
Manchester, CT 06042
Original Balance:
$130,000,000
  
General Property Type:
Retail
Cut-off Date Balance:
$130,000,000
  
Detailed Property Type:
Super Regional Mall
% of Initial Pool Balance:
11.8%
  
Net Rentable Area(1):
535,235 SF
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$243
Borrower Name(s):
Shoppes at Buckland Hills, LLC
  
Balloon/ARD Balance Per Unit/SF:
$201
Sponsor:
General Growth Properties, Inc.
  
Year Built / Year Renovated:
1990 / 2003
Mortgage Rate:
5.190%
  
Title Vesting:
Fee
Note Date:
3/1/2012
  
Property Manager(2):
General Growth Properties, Inc.
First Payment Date:
4/1/2012
      
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
3/1/2022
  
UW Revenues:
$21,994,353
IO Period:
None
  
UW Expenses:
$9,215,401
Original Term to Maturity or ARD:  
120 months
  
UW NOI:
$12,778,953
Seasoning:
0 months
  
UW NCF:
$12,295,847
Original Amortization Term:
360 months
  
UW NOI DSCR:
1.49x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.44x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
9.8%
Prepayment Provisions:
LO (24); DEF (89); O (7)
  
UW NCF Debt Yield:
9.5%
Lockbox/Cash Management:
Hard / Springing
  
UW NCF Debt Yield at Maturity:
11.4%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$13,919,053 (12/31/2011)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$14,216,651 (12/31/2010)
Mezzanine Debt:
Permitted
  
Third Most Recent NOI (As of):
$14,825,636 (12/31/2009)
Reserves
  
Appraised Value:
$189,000,000
Type
Initial
Monthly
Cap  
 
Appraisal As-of Date:
2/1/2012
Tax Reserve:
$0
Springing
NAP  
 
Cut-off Date LTV Ratio:
68.8%
Insurance Reserve:
$0
Springing
NAP  
 
LTV Ratio at Maturity/ARD:
57.0%
Replacement Reserve:
$0
Springing
$80,283  
 
Occupancy Rate:
85.4% (1/31/2012)
TI/LC Reserve:
$345,000
Springing
$535,223  
 
2nd Most Recent Occupancy:
90.3% (12/31/2011)
Repair Reserve:
$78,000
$0
NAP  
 
3rd Most Recent Occupancy:
91.1% (12/31/2010)
         
4th Most Recent Occupancy:
91.6% (12/31/2009)
         
5th Most Recent Occupancy:
91.4% (12/31/2008)
         
6th Most Recent Occupancy:
91.2% (12/31/2007)
 
(1)      The Net Rentable Area includes improvements owned by the borrower and excludes four non-collateral anchor stores, totaling 512,611 SF, which are tenant owned.
 
(2)      The property manager is the borrower, which is 100% controlled by General Growth Properties, Inc.
 
The Shoppes at Buckland Hills Mortgage Loan.
 
The Mortgage Loan. The largest mortgage loan (the “The Shoppes at Buckland Hills Mortgage Loan”) is a refinance loan evidenced by a note in the original principal amount of $130,000,000 and is secured by a first-priority fee mortgage encumbering a portion of the retail property (generally all of the in-line space and one anchor space) known as The Shoppes at Buckland Hills in Manchester, Connecticut (the “The Shoppes at Buckland Hills Property”). The Shoppes at Buckland Hills Mortgage Loan refinanced and paid off the previous loan secured by The Shoppes at Buckland Hills Property, which was included in the JPMCC 2005-LDP3 CMBS transaction.
 
The Shoppes at Buckland Hills Mortgage Loan had an initial term of 120 months and has a remaining term of 120 months. The Shoppes at Buckland Hills Mortgage Loan requires payments of principal and interest for its entire term, with a scheduled maturity date of March 1, 2022. Defeasance with direct, non-callable obligations of the United States of America (or other non-callable government securities or other non-callable instruments that will not cause the trust to lose its REMIC status and which, in each case, will not result in a downgrade or withdrawal of the ratings for the REMIC securities) is permitted at any time on or after the first due date following the
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-27
 
 
MSC 2012-C4
  The Shoppes at Buckland Hills
 
second anniversary of the securitization closing date. The Shoppes at Buckland Hills Mortgage Loan is open to prepayment at par during the final 6 months of the loan term.
 
The Borrower and the Sponsor. The borrower is Shoppes at Buckland Hills, LLC, a single-purpose Delaware limited liability company with two independent directors (the “The Shoppes at Buckland Hills Borrower”). The Shoppes at Buckland Hills Borrower is 100% controlled and majority owned by General Growth Properties, Inc. (“GGP”).
 
The Shoppes at Buckland Hills Mortgage Loan sponsor is GGP (NYSE: GGP), and the nonrecourse carve-out guarantor is GGPLP Real Estate, Inc. (the “Guarantor”), a subsidiary of GGP. An unaudited balance sheet of the Guarantor dated December 31, 2011, showed total assets of approximately $7.5 billion and total equity of approximately $2.8 billion. GGP is one of the largest shopping center owners. GGP reports ownership interests in 136 regional shopping malls comprising approximately 140 million SF of gross leasable area in the United States. The company is a publicly traded real estate investment trust. GGP and a number of its subsidiaries filed for bankruptcy protection in April 2009 and emerged from bankruptcy in November 2010.
 
The Mortgaged Property. The Shoppes at Buckland Hills Property consists of 535,235 SF of anchor and in-line retail space, food court space and kiosk space, within the 1,047,846 SF Shoppes of Buckland Hills, a super-regional mall in Manchester, Connecticut. The mortgaged property is located approximately 1 mile from the I-84 and I-291 intersection, approximately 15 miles east of Hartford. Four anchor tenants totaling 512,611 SF, which own their own stores and are not part of the collateral for The Shoppes at Buckland Hills Mortgage Loan, include Macy’s, Sears, JC Penney and Macy’s Men’s and Home. The Shoppes at Buckland Hills mall was constructed in 1990, the JC Penney store was added in 1992, and The Shoppes at Buckland Hills Property was renovated and expanded again with the Barnes & Noble store in 2003. In 2007, a former Filene’s Home store was converted into a restaurant court.
 
The collateral for The Shoppes at Buckland Hills Mortgage Loan consists of one anchor store (80,000 SF), approximately 97 in-line and major tenant stores (304,007 SF), 11 food court tenants (8,714 SF), 5 kiosks (426 SF) and 3 outparcels (63,927 SF). There is approximately 78,161 SF of vacancy, including 71,661 SF of mall shop space and a 6,500 SF pad site. The anchor tenant for The Shoppes at Buckland Hills Mortgage Loan is Dick’s Sporting Goods. Major tenants include Barnes & Noble, H&M, Victoria’s Secret, and Forever 21. One of the four outparcels, accounting for 50,000 SF of the property GLA, is developed as a third-party owned and operated Fairfield Inn hotel. The Shoppes at Buckland Hills mall in its entirety has 5,163 surface, asphalt paved parking spaces, for a total parking ratio of 4.93 spaces per 1,000 SF of total GLA, including the non-collateral anchor tenant space.
 
Based on a rent roll dated January 31, 2012, the Shoppes at Buckland Hills Property is 85.4% occupied, and The Shoppes at Buckland Hills mall overall is 92.5% occupied. For 2011, comparable in-line stores, totaling 198,259 SF (not including the major tenants listed above, food court tenants, or tenants without at least two full years of sales history) reported average sales of $378 PSF and an average occupancy cost of 16.2%. Reported comparable in-line tenant sales in 2010 were $366 PSF, and for 2009 were $353 PSF.
 
Anchor and Major Tenants.
 
Dick’s Sporting Goods (80,000 SF, 14.9% of NRA, 12.4% of underwritten base rent). Dick’s Sporting Goods leases 80,000 SF from The Shoppes at Buckland Hills Borrower. The lease began on May 10, 2006, and has a current expiration date of January 31, 2017, with four 5-year lease renewal options. Dick’s Sporting Goods, Inc. (NYSE: DKS) operates 474 Dick’s Sporting Goods stores in 42 states and 81 Golf Galaxy stores in 30 states, as of October 29, 2011. The company reported total 2010 sales of $4.9 billion and a GAAP based net income of $182.1 million.
 
Barnes & Noble (24,836 SF, 4.6% of NRA, 3.8% of underwritten base rent). Barnes & Noble leases 24,836 SF from The Shoppes at Buckland Hills Borrower. The lease began on June 2, 2003, and has a current expiration of January 31, 2014, with three 5-year lease renewal options. Barnes & Noble, Inc. (NYSE: BKS) operates 705 retail bookstores in regional shopping malls, strip centers and freestanding locations in 50 states, and 636 college bookstores, as of April 30, 2011. The company reported fiscal 2011 total sales of  $7 billion, EBITDA of $163 million, and a consolidated full-year net loss of $74 million.
 
H&M (14,298 SF, 2.7% of NRA, 3.2% of underwritten base rent). H&M leases 14,298 SF from The Shoppes at Buckland Hills Borrower. The lease began on October 31, 2003, and has a current expiration of January 31, 2014, with no lease renewal options. H&M Hennes & Mauritz AB (OMX: H&M B) operates approximately 2,500 stores in 43 countries.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-28
 
 
MSC 2012-C4
  The Shoppes at Buckland Hills
 
The following table sets forth further information regarding major tenants at The Shoppes at Buckland Hills Property:
 
Tenant Summary
Tenant Name
Credit Rating (Fitch/Moody’s/S&P)(1)
Tenant NRSF
% of
NRSF(2)
Annualized Underwritten
Base Rent ($)(3)
% of Total
Annual Underwritten
Base Rent
Annualized Underwritten Base Rent
($ Per NRSF)
Lease Expiration
2011 YE
Sales PSF
UW 
Occupancy 
Cost as % of   Sales 
Non-Collateral Anchors
                  
Macy’s
BBB-/Baa3/BBB-
144,650
NAP
$36,162(3)
0%
$0.25
12/31/2040(4)
$287(5)
NAP 
Sears
CCC/B3/CCC+
141,467
NAP
$63,660(3)
0%
$0.45
12/31/2040(4)
$200(5)
NAP 
JC Penney
BB+/NR/BB+
123,807
NAP
$55,713(3)
0%
$0.45
12/31/2040(4)
$121(5)
NAP 
Macy’s Men’s and Home    
BBB-/Baa3/BBB-
102,687
NAP
$46,209(3)
0%
$0.45
12/31/2040(4)
$314(5)
NAP 
Subtotal / Wtd. Avg.
  
512,611
  
$201,745 
0%
$0.39
      
                   
Collateral Anchors / Major Tenants
                
Dick’s Sporting Goods
NR/NR/NR
80,000
15%
$1,560,000 
12%
$19.50
1/31/2017(6)
$149   
13.1% 
Barnes & Noble
NR/NR/NR
24,836
5%
$481,250 
4%
$19.38
1/31/2014   
$262   
7.4% 
H&M
NR/NR/NR
14,298
3%
$400,344 
3%
$28.00
1/31/2014   
$168   
16.7% 
Victoria’s Secret
BB+/Ba2/BB+
13,158
2%
$328,950 
3%
$25.00
1/31/2013   
$498   
10.6% 
Forever 21
NR/NR/NR
10,472
2%
$456,579 
4%
$43.60
1/31/2018   
$321   
13.6% 
Subtotal / Wtd. Avg.
  
142,764
27%
$3,227,123 
26%
$22.60
  
$215   
11.7% 
                   
Other Tenants
  
314,310
59%
    $9,373,391 
74%
$29.82
      
Vacant Space
  
    78,161
15%
$0 
0%
$0.00
      
Total / Wtd. Avg.
  
1,047,846
100%
    $12,600,515 
100%
$27.57(7)
      
 
(1)
Certain ratings are those of the parent company whether or not the parent company guarantees the lease.
   
(2)
% of NRSF is based on collateral stores. No calculations are made for the four non-collateral anchors.
   
(3)
Non-collateral anchor Annualized Underwritten Base Rent represents CAM payments to the borrower. The tenants own their stores. These payments are not included the underwritten base rent amount, as they are included in underwritten reimbursements.
   
(4)
Non-collateral anchor Lease Expiration dates represent REA expiration dates. The tenants own their stores.
   
(5)
Non-collateral anchor stores do not report sales. The 2011 YE Sales PSF are borrower estimates. The tenants own their stores.
   
(6)
Dick’s Sporting Goods has four five-year options to renew.
   
(7)
The Wtd. Avg. Annualized Underwritten Base Rent per NRSF is based on leased collateral NRSF only. The Non-Collateral Anchor space and vacant space are excluded.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-29
 
 
MSC 2012-C4
  The Shoppes at Buckland Hills
 
The following table presents certain information relating to the lease rollover at The Shoppes at Buckland Hills Property:
 
Lease Rollover Schedule(1)(2)
Year
# of Leases Rolling
SF Rolling
Average Underwritten   
Base Rent PSF    
Rolling(3)    
Approx.
% of Total
SF Rolling
Approx.
Cumulative %
of SF Rolling
Total
Underwritten
Base Rent
Rolling
Approx.
% of Total
Base Rent
 Rolling
Approx. 
Cumulative % of 
Total Base Rent 
Rolling 
MTM
1
88
$392.05   
0%
0%
$34,500
0%
0% 
2012(3)
16
38,278
$34.37   
7%
7%
$284,386
2%
3% 
2013
20
55,491
$33.23   
10%
18%
$1,843,829
15%
17% 
2014
25
94,244
$29.11   
18%
35%
$2,743,686
22%
39% 
2015
15
28,031
$61.12   
5%
40%
$1,713,370
14%
53% 
2016
14
39,626
$33.95   
7%
48%
$1,345,446
11%
63% 
2017
8
100,698
$22.87   
19%
67%
$2,303,135
18%
81% 
2018
6
22,743
$42.74   
4%
71%
$971,925
8%
89% 
2019
4
54,130
$4.84(4)
10%
81%
$261,791
2%
91% 
2020
3
7,534
$58.24   
1%
82%
$438,772
3%
95% 
2021
4
9,861
$55.74   
2%
84%
$549,674
4%
99% 
2022 & Beyond
1
6,350
$17.32   
1%
85%
$110,000
1%
100% 
Vacant
0
78,161
$0.00   
15%
100%
$0
0%
  
Total / Wtd. Avg.
117
535,235
$27.57(5)
100%
  
$12,600,515
100%
  
 
(1)
The information in the lease rollover schedule is based on the underwritten rent roll.
   
(2)
Certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date of the subject lease and that are not considered in the lease rollover schedule.
   
(3)
12 tenants that are scheduled to roll in 2012 are either temporary tenants and do not pay base rent (in the case of 11 tenants) or pay percentage rent in lieu of base rent (in the case of one tenant). SF Rolling represents all of the 16 tenants rolling in 2012; however, the Total Underwritten Base Rent and Average Underwritten Base Rent PSF calculations include only those 4 tenants, comprising 8,274 SF, that pay base rents. Percentage rents are included in underwritten Other Income in the table below.
   
(4)
50,000 SF of the scheduled roll in 2019 relates to a ground leased outparcel at $1.85 PSF.
   
(5)
Average Underwritten Base Rent PSF Rolling excludes vacant space.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-30
 
 
MSC 2012-C4
  The Shoppes at Buckland Hills
 
The Market. The Shoppes at Buckland Hills Property is located in the northeastern sector of the Hartford MSA in Hartford County, approximately 15 miles east of the City of Hartford. The Hartford CBSA had a population of approximately 1,219,560 in 2011, and the subject’s total trade area had a population of approximately 556,455 for the same year. Trade area average annual household income for 2011 was estimated at $73,885.
 
According to the appraiser, The Shoppes at Buckland Hills Property has historically been the dominant center serving the eastern portion of the Hartford metropolitan area. Other major shopping malls in the metropolitan area include Westfarms Mall in Farmington, CT, which is 20 miles from The Shoppes at Buckland Hills Property and 93% occupied; Enfield Square in Enfield, CT, which is 21 miles from The Shoppes at Buckland Hills Property and 83% occupied; and Westfield – Meriden in Meriden, CT, which is 27 miles from The Shoppes at Buckland Hills Property and 85% occupied. In addition, The Promenade Shops of EvergrChangedeen Walk, a 379,000 SF lifestyle center, is located less than one mile from The Shoppes at Buckland Hills Property. Below is a table of competitive shopping centers.
 
Competitive Property Summary
Property
Center Type
Competition
Year
Built
Year
Renovated
Total GLA
Anchor Tenants
Sales
PSF
 Occupancy
Proximity
Westfarms Mall
Super-Regional Mall
Primary
1974
1997
1,298,796  
JC Penney, Lord &
Taylor, Macy’s,
Macy’s, Nordstrom
$473
93%  
20 miles
Enfield Square
Super-Regional Mall
Primary
1970
2003
787,819  
Macy’s, Macy’s,
Sears, Target
$335
 
83%  
 
21 miles
Westfield – Meriden
Super-Regional Mall
Primary
1971
1999
893,052  
Best Buy, Dick’s
Sporting Goods, JC
Penney, Macy’s
Sears
$307
 
 
 
85%  
 
 
 
27 miles
The Promenade Shops of Evergreen Walk
Lifestyle
Center
Primary
2004
NAP
379,000  
LL Bean, Vacant
NAV
 
75%  
 
0.5 miles
Eastbrook Mall
Regional
Center
Secondary
1975
1986
249,846  
JC Penney, Kohl’s,
TJ Maxx
$180
 
95%  
 
26 miles
Brass Mill Center
Super-Regional Mall
Secondary
1997
NAP
986,004  
Macy’s, JC Penney,
Sears
$350
 
 
77%  
 
 
38 miles
Crystal Mall
Super-Regional Mall
Secondary
1984
1997
 783,352  
Bed, Bath & Beyond,
Christmas Tree
Shops, JC Penney,
Macy’s, Sears
 
$310
 
89%  
 
50 miles
 
Source: Appraisal
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-31
 
 
MSC 2012-C4
  The Shoppes at Buckland Hills
 
Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at The Shoppes at Buckland Hills Property:
 
Cash Flow Analysis
  
 
2009
  
2010
  
2011
  
UW
  
UW PSF
  
Gross Potential Rent(1)
$13,349,870
  
$12,916,373
  
$13,049,521
  
$12,600,515
  
$23.54
  
Total Reimbursements
$7,422,012
  
$7,091,088
  
$6,609,618
  
$6,609,618
  
$12.35
  
Percentage Rent in Lieu and Overage Rent(2)
$223,937
  
$317,449
  
$493,442
  
$248,488
  
$0.46
  
Other Income(3)
$2,821,964
  
$2,895,628
  
$2,829,783
  
$2,535,733
  
$4.74
  
Less Vacancy & Credit Loss
$(59,544)
  
$(58,051)
  
$(57,011)
  
$0
  
$0
  
Effective Gross Income
$23,758,239
  
$23,162,487
  
$22,982,353
  
$21,994,353
  
$41.09
  
Total Expenses
$8,932,603
  
$8,945,836
  
$9,006,300
  
$9,215,401
  
$17.22
  
Net Operating Income
$14,825,636
  
$14,216,651
  
$13,919,053
  
$12,778,953
  
$23.88
  
TI/LC
$0
  
$0
  
$0
  
$376,058
  
$0.70
  
Capital Expenditures
$0
  
$0
  
$0
  
$107,047
  
$0.20
  
Net Cash Flow
$14,825,636
  
$14,216,651
  
$13,919,053
  
$12,295,847
  
$22.97
  
Occupancy %
91.6%
  
91.1%
  
90.3%
  
85.4%
      
NOI DSCR
1.73x
  
1.66x
  
1.63
  
1.49x
      
NCF DSCR
1.73x
  
1.66x
  
1.63
  
1.44x
      
NOI Debt Yield
11.4%
  
10.9%
  
10.7%
  
9.8%
      
NCF Debt Yield
11.4%
  
10.9%
  
10.7%
  
9.5%
      
Average Annual Rent PSF(4)
$27.23
  
$26.49
  
$27.00
          
                  
(1)
Historical and Underwritten Gross Potential Rent are net of vacancy. Underwritten Gross Potential rent includes $148,087 of contractual rent steps through August 1, 2012.
   
(2)
Underwritten Percentage Rent in Lieu excludes amounts paid in 2011 by Finish Line and Hallmark, which tenants now pay base minimum rents.
   
(3)
 
Historical Other Income includes specialty leasing fees from temporary and short-term tenants, lease termination fees, other rental income and miscellaneous income. Underwriting is based on 2011 actual collections, excluding $294,050 of lease termination fees.
   
(4)
Average Annual Rent PSF is based on historical financials and end of year property occupancy rates. Vacant space is excluded from the calculation.
 
Escrows and Reserves.  The Shoppes at Buckland Hills Borrower is required to deposit certain on-going reserves during the continuance of a Trigger Period. During the continuance of a Trigger Period, monthly reserves for taxes and insurance in the amount of 1/12 of the annual estimated tax payments and insurance premiums will be funded from the Cash Management Account. Notwithstanding the foregoing, if The Shoppes at Buckland Hills Borrower maintains insurance under an acceptable blanket insurance policy, then the monthly reserve for insurance premiums will not be required. Also during the continuance of a Trigger Period, The Shoppes at Buckland Hills Borrower is required to make monthly deposits of $6,690 for replacement reserves and $44,602 for TI/LC reserves, provided that such deposits are not required at any time that the amount then on deposit in the replacement exceeds $80,283 or in the TI/LC reserve exceeds $535,223. In addition, The Shoppes at Buckland Hills Borrower deposited $345,506 in escrow for TI/LCs at loan origination. A “Trigger Period” commences either (a) upon the determination by the lender that the Debt Service Coverage Ratio is less than 1.20x or (b) on the date an event of default occurs, and continues until either the Debt Service Coverage Ratio is equal to or in excess of 1.20x or such event of default has been cured or waived in writing. The “Debt Service Coverage Ratio” means the ratio of net operating income for the prior twelve month period (adjusted for normalized TI/LCs equal to $1.00 PSF per annum and normalized capital improvements equal to $0.20 PSF per annum) to annual debt service.
 
Lockbox and Cash Management. A hard lockbox is in place with respect to The Shoppes at Buckland Hills Mortgage Loan. The Shoppes at Buckland Hills Mortgage Loan has springing cash management. Provided a Trigger Period has not commenced and is continuing, funds in the lockbox account are swept daily to an account designated by The Shoppes at Buckland Hills Borrower. During the continuance of a Trigger Period, funds in the lockbox account are applied on each monthly payment date to pay debt service on The Shoppes at Buckland Hills Mortgage Loan and to fund the required reserves deposits as described above under “—Escrows and Reserves”, with any excess being remitted to The Shoppes at Buckland Hills Borrower (unless the Trigger Period is caused by an event of default in which event the excess is held by the mortgagee as additional security for The Shoppes at Buckland Hills Mortgage Loan).
 
Property Management. The Shoppes at Buckland Hills Property is managed by The Shoppes at Buckland Hills Borrower, which is indirectly majority owned and controlled by GGP, or an affiliate thereof.
 
Mezzanine Loan and Preferred Equity.  GGP and any subsidiary owning either a direct or indirect interest in The Shoppes at Buckland Hills Borrower (collectively, the “Upper Tier GGP Entity”) may pledge its respective direct or indirect interests in The Shoppes at Buckland Hills Borrower to a Qualified Pledgee (as defined in the loan documents) in one or a series of transactions in connection with the pledge of all or substantially all of such Upper Tier GGP Entity’s assets to such Qualified Pledgee (as defined in the loan documents) to secure the direct obligations or debt of such Upper Tier GGP Entity.
 
Additional Secured Indebtedness (not including trade debts). Not permitted.
 
Release of Parcels.  See “—Expansion, Release and Substitution of Property” below.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-32
 
 
MSC 2012-C4
  The Shoppes at Buckland Hills
 
Terrorism Insurance.  Generally, The Shoppes at Buckland Hills Borrower is required to maintain (or cause to be maintained) insurance against loss for acts of terrorism with respect to The Shoppes at Buckland Hills Property; provided, that The Shoppes at Buckland Hills Borrower shall not be required to spend in excess of $100,000 per annum on coverage for terrorism events.
 
Assumption Provisions. Commencing 30 days following the issuance of securities involving The Shoppes at Buckland Hills Mortgage Loan or any portion thereof, The Shoppes at Buckland Hills Borrower may sell all The Shoppes at Buckland Hills Property, subject to the satisfaction of certain requirements and conditions set forth in the loan documents, including, but not limited to, the following: (i) no default or event of default has occurred and is continuing, (ii) the person to whom The Shoppes at Buckland Hills Property is sold satisfies the requirements of a special purpose entity and has organizational documents which are acceptable to the rating agencies, (iii) such person is controlled by a “permitted owner” as defined in the loan documents (generally defined as (x) certain entities that have or control total real estate assets of at least $500 million and are managed by (or acting on behalf of) persons who control at least $500 million of real estate equity assets or (y) other entities that have total assets (in name or under management) in excess of $500 million and (except with respect to a pension advisory firm or similar fiduciary) capital/statutory surplus or shareholders equity in excess of $500 million, in each case, excluding The Shoppes at Buckland Hills Property and are regularly engaged in the business of owning and operating properties similar to The Shoppes at Buckland Hills Property, or (z) other entities that have total assets (in name or under management) in excess of $500 million and (except with respect to a pension advisory firm or similar fiduciary) capital/statutory surplus or shareholders equity in excess of $250 million and are regularly engaged in the business of making or owning commercial real estate loans or commercial loans secured by a pledge of interests in a mortgage borrower or owning and operating commercial mortgage properties, or any affiliate of the entities referred to in clauses (x), (y) or (z) that are controlled by such person), (iv) The Shoppes at Buckland Hills Borrower pays a transfer fee equal to 0.25% of the then outstanding principal balance of The Shoppes at Buckland Hills Mortgage Loan and (v) a replacement guarantor reasonably acceptable to lender assumes the guarantor’s obligations under the recourse carve-out guaranty.
 
Expansion, Release and Substitution of Property.  The Shoppes at Buckland Hills Borrower may obtain a release of certain parcels (including air rights parcels) or outlets or acquired expansion parcels or designated release parcels upon satisfaction of specified conditions, including that the parcels are not necessary for the operation or use of The Shoppes at Buckland Hills Property for its then current use and may be readily separated from The Shoppes at Buckland Hills Property without a material diminution in value (except this condition will not apply to acquired expansion parcels or designated release parcels). In addition, portions of The Shoppes at Buckland Hills Property may be released from the lien of the mortgage in substitution for parcels at or adjacent to the shopping center upon satisfaction of specified conditions, including that the acquired parcels be of reasonably equivalent value, and that the parcel to be released is vacant, non-income producing and unimproved or improved only by landscaping or utility facilities that may be readily relocated or surface parking areas. The Shoppes at Buckland Hills Borrower is permitted to acquire from time to time parcels of land that are an integral part of or adjoin or are proximately located near The Shoppes at Buckland Hills mall of which The Shoppes at Buckland Hills Property is a part upon satisfaction of specified customary conditions for such an acquisition.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-33
 
 
MSC 2012-C4
 Ty Warner Hotels & Resorts Portfolio
 
Mortgage Loan No. 2 – Ty Warner Hotels & Resorts Portfolio
 
(PHOTO)
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-34
 
 
MSC 2012-C4
 Ty Warner Hotels & Resorts Portfolio
 
Mortgage Loan No. 2 – Ty Warner Hotels & Resorts Portfolio
 
(MAP)
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-35
 
 
MSC 2012-C4
 Ty Warner Hotels & Resorts Portfolio
 
Mortgage Loan No. 2 – Ty Warner Hotels & Resorts Portfolio
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Sellers:
BANA/MSMCH
  
Single Asset/ Portfolio:
Portfolio
Credit Assessment
(DBRS/KBRA/Moody’s):
BBB (low)/BBB/Baa1
  
Property Address:
1260 Channel Drive, Santa Barbara,
CA 93108; KM 19.5 Carretera
Transpeninsular, San Jose del Cabo,
Mexico 23400; 900 San Ysidro Lane,
Montecito CA 93108
Original Balance:
$100,000,000
    
Cut-off Date Balance:
$99,751,201
% of Initial Pool Balance:
9.1%
General Property Type:
Hospitality
Loan Purpose:
Refinance
  
Detailed Property Type:
Full Service
Borrower Name(s):
1260 BB Property, LLC; San Ysidro
BB Property, LLC; Paraiso Los
Cabos, S. DE R.L. DE C.V.; Paraiso
BB Mexico, S. DE R.L. DE C.V.
  
Number of Units/SF:
319  Rooms
   
Cut-off Date Principal Balance Per
Unit/SF:
$312,700
     
Sponsor:
H. Ty Warner
  
Balloon/ARD Balance Per Unit/SF:
$295,946
Mortgage Rate:
6.600%
  
Year Built / Year Renovated:
1825-1997 / 2006-2011
Note Date:
11/29/2011
  
Title Vesting:
Fee
First Payment Date:
1/1/2012
  
Property Manager:
Four Seasons Hotels Limited; Ty
Warner Hotels & Resorts, LLC;
Rosewood Hotels and Resorts
International, Inc.
Anticipated Repayment Date:
NAP
    
Maturity Date:
12/1/2016
    
IO Period:
None
  
Underwriting and Financial Information
Original Term to Maturity or ARD:  
60 months
  
UW Revenues:
$103,056,200
Seasoning:
3 months
  
UW Expenses:
$78,334,410
Original Amortization Term:
360 months
  
UW NOI:
$24,721,790
Loan Amortization Type:
Amortizing
  
UW NCF:
$20,599,542
Interest Accrual Basis:
Actual/360
  
UW NOI DSCR:
3.23x
Prepayment Provisions:
LO (27); DEF (29); O (4)
  
UW NCF DSCR:
2.69x
Lockbox/Cash Management:
Hard / Springing
  
UW NOI Debt Yield:
24.8%
Pari Passu Mortgage Debt:
None
  
UW NCF Debt Yield:
20.7%
Subordinate Mortgage Debt:
None
  
UW NCF Debt Yield at Maturity:
21.8%
Mezzanine Debt:
$80,000,000
  
Most Recent NOI (As of):
$24,721,790 (12/31/2011)
     
Second Most Recent NOI (As of):
$18,983,800 (12/31/2010)
     
Third Most Recent NOI (As of):
$10,272,600 (12/31/2009)
Reserves
  
Appraised Value:
$458,000,000
Type
Initial
Monthly
Cap   
 
Appraisal As-of Date:
6/30/2011 - 7/8/2011
Tax Reserve(1):
$0
Springing
NAP  
 
Cut-off Date LTV Ratio:
21.8%
Insurance Reserve(1):
$0
Springing
NAP  
 
LTV Ratio at Maturity/ARD:
20.6%
Replacement Reserve(1):
$0
Springing
NAP  
 
Occupancy Rate:
73.5% (12/31/2011)
Other Reserve(1):
$0
Springing
NAP  
 
2nd Most Recent Occupancy:
68.1% (12/31/2010)
         
3rd Most Recent Occupancy:
54.4% (12/31/2009)
         
4th Most Recent Occupancy:
65.3% (12/31/2008)
         
5th Most Recent Occupancy:
68.4% (12/31/2007)
 
(1)
The Ty Warner Hotels & Resorts Portfolio Mortgage Loan has a springing requirement to escrow for replacement reserves, condominium common charge reserves, taxes and insurance and excess cash, as described under “—Escrows and Reserves” and “—Lockbox and Cash Management” below.
 
The Ty Warner Hotels & Resorts Portfolio Mortgage Loan.
 
The Mortgage Loan.  The second largest mortgage loan (the “Ty Warner Hotels & Resorts Portfolio Mortgage Loan”) is a refinance loan evidenced by two pari passu notes in the total original principal amount of $100,000,000, and is secured by first priority fee interest in three luxury hotel properties known as the Four Seasons Resort “The Biltmore” Santa Barbara (the “Four Seasons Santa Barbara Property”) located in Santa Barbara, California, the San Ysidro Ranch (the “San Ysidro Property”) located in Montecito, California, and Las Ventanas al Paraiso (the “Las Ventanas Property,” and together with the Four Seasons Santa Barbara Property and the San Ysidro Property, the “Ty Warner Hotels & Resorts Portfolio Property”) located in San Jose del Cabo, Mexico. The Ty Warner Hotels & Resorts Portfolio Mortgage Loan was co-originated on November 29, 2011 by or on behalf of Bank of America, National Association and Morgan Stanley Mortgage Capital Holdings LLC.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-36
 
 
MSC 2012-C4 Ty Warner Hotels & Resorts Portfolio
                                                                       
The Ty Warner Hotels & Resorts Portfolio Mortgage Loan had an initial term of 60 months and has a remaining term of 57 months. The Ty Warner Hotels & Resorts Portfolio Mortgage Loan requires payments of principal and interest for its entire term with a scheduled maturity date of December 1, 2016. At any time on or after the first due date following the second anniversary of the securitization closing date, prepayment is permitted, in whole, through defeasance with direct, non-callable obligations of the United States of America. Partial defeasance is permitted in connection with the release of the San Ysidro Property and/or the Las Ventanas Property as further described under “Property Releases” below. The Ty Warner Hotels & Resorts Portfolio Mortgage Loan is open to prepayment at par during the final 3 months of the loan term. The Ty Warner Hotels and Resorts Mortgage Loan refinanced and paid off the previous loan secured by the Ty Warner Hotels and Resorts Property, which was included in the TYHOT 2005-LUX CMBS transaction.
 
The Borrower and the Sponsor.  The borrowers are 1260 BB Property, LLC and San Ysidro BB Property, LLC, each a single purpose Delaware limited liability company, and Paraiso Los Cabos, S. DE R.L. DE C.V. and Paraiso BB Mexico, S. DE R.L. DE C.V., each a single purpose Mexican entity (collectively, the “Ty Warner Hotels & Resorts Portfolio Borrower.”)  The Ty Warner Hotels & Resorts Portfolio Borrower is 100% owned by Ty CA/MX Holdings, LLC, which is 100% owned by Ty CA/MX Holdings II, LLC, whose sole member and manager is H. Ty Warner, who is the loan sponsor, non-recourse carve-out guarantor and environmental indemnitor.
 
H. Ty Warner is the owner of Ty Warner Hotels & Resorts, which was incorporated in 2001, and which owns and operates a number of hotels, resorts and golf courses, including the Four Seasons New York, the Montecito Country Club, the Sandpiper Golf Club and the Rancho San Marcos Golf Course, in addition to the Ty Warner Hotels & Resorts Portfolio. Prior to his involvement with Ty Warner Hotels & Resorts, Mr. Warner created the line of Beanie Babies toys through his company, Ty Inc. Consistently over more than the last ten years, Mr. Warner has been ranked by Forbes as amongst the world’s wealthiest people, most recently in 2011 with an estimated personal net worth of approximately $2.4 billion.
 
After the significant investment in capital improvements to the Ty Warner Hotels & Resorts Portfolio, the loan sponsor has approximately $499 million of cash equity remaining with respect to the Ty Warner Hotels & Resorts Portfolio properties.
 
The Mortgaged Property.
 
The table below describes the properties comprising the Ty Warner Hotels & Resorts Portfolio Property:
 
 
Property Summary
Property
Location
Rooms 
Year Built/   Renovated  
Allocated  
Loan  
Amount  
Appraised 
Value 
UW NCF  
Four Seasons Resort “The Biltmore” Santa Barbara
    Santa Barbara, CA
207 
1927/2006 
$52,025,000 
$249,200,000 
$9,626,972  
San Ysidro Ranch
    Montecito, CA
41 
1825/2010 
$13,250,000 
$60,500,000 
$3,224,340  
Las Ventanas al Paraiso
    San Jose del Cabo, Mexico
71 
1997/2011 
$34,725,000 
$148,300,000 
$7,748,230  
Total
  
319 
 
$100,000,000 
$458,000,000 
$20,599,542  
 
Four Seasons Resort “The Biltmore” Santa Barbara, Santa Barbara, California
 
The Four Seasons Santa Barbara Property is a historic, luxury resort with 185 rooms and 22 suites and cottages built on 18.3 acres of beach-front property in Santa Barbara, California. In addition to the lodging accommodations, the Four Seasons Santa Barbara Property includes 15,280 SF of meeting space, two restaurants, a bar/lounge, a croquet lawn and putting green, tennis courts, an on-site pool and workout room, a spa facility with ten treatment rooms, and fitness facilities. The Four Seasons Santa Barbara Property also includes a private swim club known as the Coral Casino Beach and Cabana Club, which houses an Olympic-size lap pool, steam room and sauna, exercise room, lounge and dining facilities, and a 4,200 SF ocean view ballroom available to hotel guests and club members. Since acquiring the Four Seasons Santa Barbara Property in 2000 for $150 million, the sponsor has since invested approximately $266 million, renovating all of the hotel guestrooms, the swim club, the fitness center and spa, and has invested in improvements to the infrastructure and landscaping.
 
More specific information about the Four Seasons Santa Barbara Property is set forth in the table below:
 
 
Four Seasons Santa Barbara Property and Market Historical Occupancy, ADR, RevPAR
 
 
Competitive Set
 
Four Seasons Santa Barbara Property
 
Penetration Factor
 
Year
Occupancy
ADR
RevPAR
Occupancy
ADR
RevPAR
Occupancy
ADR
RevPAR
TTM 12/2010
57.3%  
$387.63 
$222.13  
74.7%  
$446.99  
$333.69  
130.3%  
115.3%  
150.2%  
TTM 12/2011
65.3%  
$395.47 
$258.19  
79.5%  
$479.72  
$381.53  
121.8%  
121.3% 
147.8%  
 
Source: Industry Report
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
  
 
T-37
 
 
MSC 2012-C4 Ty Warner Hotels & Resorts Portfolio
    
The Market. The Four Seasons Santa Barbara Property is located at 1260 Channel Drive in the community of Montecito in Santa Barbara, California. Located 95 miles north of Los Angeles along US Highway 101, accessible via Amtrak, and serviced by both the Los Angeles International Airport and the Santa Barbara Municipal Airport, Santa Barbara is a convenient destination for regional, national, and international visitors. The most recent published report in the appraisal indicated direct tourism spending in Santa Barbara County of $1.425 billion.
 
Competing properties to the Four Seasons Santa Barbara Property are shown in the table below:
 
 
Primary Competitive Supply
 
Property
Location
Rooms 
 Distance (miles from   
 Four Seasons Santa   
 Barbara Property)   
2010 Occupancy% 
(2010 Performance vs.   Competitive Supply) 
2010 ADR 
(2010 Performance vs.   Competitive Supply))
Four Seasons Santa Barbara
Santa Barbara, CA
207 
-
74.7%
(Above)
$446.99
(Above)
Park Hyatt Aviara
Carlsbad, CA
329 
200
(Below)
(Below)
Montage Resort and Spa
Laguna Beach, CA
262 
150
(Above)
(Above)
San Ysidro Ranch
Montecito, CA
41 
4
(Below)
(Above)
St. Regis Monarch Beach
Dana Point, CA
400 
150
(Below)
(Below)
Ritz Carlton Laguna
Dana Point, CA
393 
150
(Below)
(Below)
Fee’s Parker Doubletree
Santa Barbara, CA
360 
3
(Above)
(Below)
Ojai Valley Inn
Ojai, CA
308 
38
(Above)
(Below)
Pelican Hill
Newport Coast, CA
332 
150
(Below)
(Above)
Competitive Supply Total
  
2,632 
Various
57.2%
$350.68
 
Source: Appraisal
 
The 2010 occupancy rate for the competitive supply was 57.2% and the appraiser forecasts occupancy to grow to 68.0% in 2014. The appraiser’s 2012 forecasts for the competitive supply are 64.0% for occupancy and $382.00 for average daily rate, resulting in revenue per available room rate of $243.11.
 
San Ysidro Ranch, Montecito, California
 
The San Ysidro Property is a 41-room luxury resort located on 14.2 acres in the enclave of the Montecito foothills, between the Santa Inez Mountains and the Pacific Ocean. San Ysidro Ranch was founded in the 18th century by the King of Spain as a citrus ranch. Cottages were added and the property opened as a hotel in 1893. The rooms are spread between 22 private cottages, each with an outdoor terrace, wood burning fireplace and hot tub. Resort guests have access to two award winning restaurants, a fitness center, tennis courts, pool, and 17 miles of public hiking and walking trails on an adjacent 435 acre parcel. The sponsor acquired the San Ysidro Property in 2000 for $28.5 million, and in 2007 completed $110 million in renovations on the rooms, restaurants, infrastructure and road resurfacing.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
  
 
T-38
 
    
MSC 2012-C4 Ty Warner Hotels & Resorts Portfolio
    
More specific information about the San Ysidro Property is set forth in the table below:
 
 
San Ysidro Property and Market Historical Occupancy, ADR, RevPAR
 
 
Competitive Set
 
San Ysidro Property
 
Penetration Factor
 
Year
Occupancy  
ADR  
RevPAR  
Occupancy  
ADR  
RevPAR  
Occupancy  
ADR  
RevPAR  
TTM 12/2010
66.4%  
$464.35  
   $308.46  
51.4%  
$998.99  
$513.55  
77.4%  
215.1%  
166.5%  
TTM 12/2011
70.7%  
$485.16  
$343.12  
56.9%  
$1,103.65  
$627.53  
80.4%  
227.5%  
182.9%  
 
Source: Industry Reports
 
The Market. The San Ysidro Property is located at 900 San Ysidro Lane in the hills of Montecito in Santa Barbara, California, approximately four miles from the Four Seasons Santa Barbara Property. Santa Barbara is considered a California destination market and a convenient destination for regional, national and international visitors.
 
Competing properties to the San Ysidro Property are shown in the table below:
 
 
Primary Competitive Supply
 
Property
Location
Rooms  
Distance (miles  
from San Ysidro  
Property)  
2010 Occupancy%  
(2010 Performance vs.  
Competitive Supply)  
2010 ADR  
(2010 Performance vs.  
 Competitive Supply) )
San Ysidro Ranch
Montecito, CA
41  
-
51.4%
(Below)
$998.99
(Above)
Four Seasons Santa Barbara
Santa Barbara, CA
207  
4
(Above)
(Below)
Montage Laguna Beach
Laguna Beach, CA
262  
130
(Below)(1)     
 (Below)(1)  
Post Ranch Inn
Big Sur, CA
40  
140
(Above)
(Above)
Ventana Inn
Big Sur, CA
60  
170
(Below)
(Below)
Casa Palmero
Pebble Beach, CA
24  
195
(Below)
(Above)
Auberge Du Soleil
Rutherford, CA
52  
320
(Above)
(Above)
Bardessono
Yountville, CA
57  
310
(Above)
(Below)
Meadowood
St. Helena, CA
99  
325
(Below)
(Below)
Calistoga Ranch
Calistoga, CA
48  
330
(Below)
(Above)
Hotel Bel-Air (Reopening 2012)
Los Angeles, CA
103  
75
(Above)(1)     
(Above)(1)  
Competitive Supply Total
Competitive Supply Total
884  
Various
64.0%
$598.16
 
Source: Appraisal
 
(1)
Year of historical performance not specified
 
The 2010 occupancy rate for the competitive supply was 64.0% and the appraiser forecasts occupancy to grow to 70.0% in 2014. The appraiser’s 2012 forecasts for the competitive supply are 69.0% for occupancy and $668.00 for average daily rate, resulting in revenue per available room rate of $458.18.
 
Las Ventanas al Paraiso, San Jose del Cabo, Mexico
 
The Las Ventanas Property is a luxury resort located on 18.6 acres in the Los Cabos – Tourist Corridor, Baja California Sur, Mexico. The Las Ventanas Property consists of 19 low-rise buildings containing 61 hotel suites, an additional 10 sponsor-owned condominium units, a reception building and meeting facility, retail space, restaurants and bars, and a fitness facility. The hotel suites range from 960 to 3,600 SF, and all accommodations contain private patios, wood burning fireplaces and Jacuzzi tubs. The Las Ventanas Property features private beach access, nine vanishing edge pools, two tennis courts, and a spa facility with eight treatment rooms. The Sponsor acquired the Las Ventanas Property between 2004 and 2005 for approximately $114 million and has since invested approximately $10.1 million in capital improvements.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
  
 
T-39
 
    
MSC 2012-C4 Ty Warner Hotels & Resorts Portfolio
    
More specific information about the Las Ventanas Property is set forth in the table below:
 
 
Las Ventanas Property and Market Historical Occupancy, ADR, RevPAR
 
 
Competitive Set
 
Las Ventanas Property
 
Penetration Factor
 
Year
Occupancy  
ADR  
RevPAR  
Occupancy  
ADR  
RevPAR  
Occupancy  
ADR  
RevPAR  
TTM 12/2010
51.1%  
$4,308.83  
$2,199.97  
58.5%  
$12,926.97  
$7,563.14  
114.6%  
300.0%  
343.8%  
TTM 12/2011
53.1%  
$4,635.80  
$2,460.63  
65.4%  
$12,208.26  
$7,980.71  
123.2%  
263.3%  
324.3%  
 
Source: Industry Reports.
 
The Market. The Las Ventanas Property is located at KM 19.5 Carretera Transpeninsular in San Jose del Cabo, at the southern tip of Baja California Sur, Mexico. Baja California Sur is the southern state of the Baja Peninsula, and contains approximately seventeen percent of Mexico’s total coastline, attracting over five million tourists annually. The Las Ventanas Property is located on a 20-mile stretch of beach in the Los Cabos region, between the cities of Cabo San Lucas and San Jose del Cabo, in the development area known as Cabo Real (Tourist Corridor), which contains many of the region’s most luxurious resorts, residential homes, and timeshares. It also has eight premier golf courses and is an acclaimed year-round sport fishing destination. The Las Ventanas Property is approximately 20 minutes driving distance from the (San Jose del Cabo) Los Cabos International Airport, the second most active tourist level airport in Mexico.
 
Mexico currently ranks 10th globally in international tourism arrivals, and 19th in international tourism revenues. Revenue from international tourism exceeded $11.8 billion in 2010. From January to May of 2011, international tourism to Mexico increased 2.1% compared to the same period in 2010 (representing more than 9.5 million tourists.) The Los Cabos region has seen hotel occupancy increase 5% since 2010.
 
The competitive supply to the Las Ventanas Property discussed in the table below is the highest quality resort product in Mexico and Central America in proximity to the Las Ventanas Property. Competing properties to the Las Ventanas Property are Capella (66 rooms), One & Only Palmilla (173 rooms), Esperanza (51 rooms), Four Seasons Punta Mita (140 rooms), St Regis Punta Mita (120 rooms) and Four Seasons Costa Rica (163 rooms). Although they offer similar world-class amenities and are situated in unique destinations, these properties do not directly compete with one another. The Las Ventanas Property has historically been the market leader in Mexico, as well as in the global destination resort market, capturing consistently higher occupancy by continuing to reinvent and upgrade its standards and services to attract a guest profile that is generally not price sensitive.
 
 
Historical Performance
 
Year
Las Ventanas Property   Occupancy % 
Competitive Supply   Occupancy % (1)  
Las Ventanas  
Property ADR  
Competitive  
Supply ADR (1)  
Las Ventanas  
Property RevPAR  
Competitive Supply   
RevPAR (1)   
2006
85.0%
81.9%
$1,079.27
$720.49
$917.38
$589.77
2007
82.9%
78.8%
$1,224.99
$805.48
$1,015.52
$634.83
2008
78.5%
71.4%
$1,230.30
$834.04
$965.79
$595.37
2009
51.4%
45.1%
$1,045.64
$755.92
$537.46
$341.24
2010
58.5%
51.6%
$1,025.56
$725.39
$599.95
$374.28
 
Source: Appraisal
 
(1)
The properties included in the Competitive Supply statistics are the Las Ventanas Property, the One and Only Palmilla, the Four Seasons Punta Mita, Esperanza and the Four Seasons Costa Rica.
 
The 2010 occupancy rate for the competitive supply was 51.6%, and the appraiser forecasts occupancy to grow to 68.0% in 2014. The appraiser’s 2012 forecasts for the competitive supply are 60.0% for occupancy and $738.00 for average daily rate, resulting in revenue per available room rate of $442.29.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
  
 
T-40
 
 
MSC 2012-C4 Ty Warner Hotels & Resorts Portfolio
 
Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the underwritten net cash flow at the Ty Warner Hotels & Resorts Portfolio Property:
 
Cash Flow Analysis
 
  
 
2009  
 
2010  
 
2011  
 
UW
 
UW per Room 
 
Occupancy %
54.4%
  
68.1%
  
73.5%
  
73.5%
      
ADR
$652.79
  
$611.25
  
$639.62
  
$639.62
      
RevPAR
$355.21
  
$416.08
  
$469.91
  
$469.91
      
                     
Total Revenue
$77,737,000
  
$90,799,200
  
$103,056,200
  
$103,056,200
  
$323,060.19
  
Total Departmental Expenses
$37,675,700
  
$42,123,100
  
$47,191,040
  
$47,191,040
  
$147,934.29
  
Gross Operating Profit
$40,061,300
  
$48,676,100
  
$55,865,160
  
$55,865,160
  
$175,125.89
  
                     
Total Undistributed Expenses
$23,009,900
  
$22,378,900
  
$23,745,860
  
$23,745,860
  
$74,438.43
  
Profit Before Fixed Charges
$17,051,400
  
$26,297,200
  
$32,119,300
  
$32,119,300
  
$100,687.46
  
                     
Total Fixed Charges
$6,778,800
  
$7,313,400
  
$7,397,510
  
$7,397,510
  
$23,189.69
  
Net Operating Income
$10,272,600
  
$18,983,800
  
$24,721,790
  
$24,721,790
  
$77,497.77
  
                     
FF&E
3,109,480
  
$3,631,968
  
$4,122,248
  
$4,122,248
  
$12,922.41
  
Net Cash Flow
$7,163,120
  
$15,351,832
  
$20,599,542
  
$20,599,542
  
$64,575.37
  
                     
NOI DSCR
1.34x
  
2.48x
  
3.23x
  
3.23x
      
NCF DSCR
0.93x
  
2.00x
  
2.69x
  
2.69x
      
NOI Debt Yield
10.3%
  
19.0%
  
24.8%
  
24.8%
      
NCF Debt Yield
7.2%
  
15.4%
  
20.7%
  
20.7%
      
 
Escrows and Reserves.  Each Property Manager is responsible for maintaining reserve accounts, to which the mortgagee has been granted a first priority security interest, and for making the necessary payments from each reserve account pursuant to the applicable management agreement. If any Property Manager fails to maintain the reserve accounts for replacements or taxes and insurance, or if any Property Manager fails to pay condominium common charges for the Las Ventanas Property, or in the event of a Manager Trigger, then the Ty Warner Hotels & Resorts Portfolio Borrower is required to escrow with mortgagee 4% of budgeted gross income from operations as replacement reserves monthly, amounts for condominium common charges for the Las Ventanas Property monthly, amounts for property taxes monthly, and amounts for insurance premiums monthly (except to the extent that it has been waived due to the insurance being maintained under a blanket policy.)  A “Manager Trigger” will generally commence in the event that the one of the properties in the Ty Warner Hotels & Resorts Portfolio is no longer managed by a “Qualified Manager” as defined in the Ty Warner Hotels & Resorts Portfolio Mortgage Loan documents.
 
Lockbox and Cash Management. Hard lockbox accounts held by the property manager, to which the mortgagee has been granted first priority security interests, are in place with respect to the Ty Warner Hotels & Resorts Portfolio Mortgage Loan, from which the property manager has the discretion to withdraw funds pursuant to the applicable management agreement. Upon a Manager Trigger, funds in the lockbox accounts will be transferred to the cash management account controlled by mortgagee. In addition, upon a Manager Trigger or during a Cash Sweep Period, the Ty Warner Hotels & Resorts Portfolio Borrower will be required to deposit all excess cash with respect to the Ty Warner Hotels & Resorts Portfolio Mortgage Loan to be held by the mortgagee as additional security. A “Cash Sweep Period” will generally commence upon the earlier of an event of default or the occurrence of the debt yield for the Ty Warner Hotels & Resorts Portfolio Mortgage Loan for the immediately preceding two calendar quarters being less than 14%, and ending on the date that the event of default is accepted as cured or the debt yield for the immediately preceding two calendar quarters is equal to or greater than 14%.
 
Currency Conversion.  With respect to the Las Ventanas Property, no later than the last business day of each month, the Ty Warner Hotels & Resorts Portfolio Borrower is required to (i) convert to U.S. dollars any excess pesos on deposit in peso-denominated Mexico lockbox accounts after the payment of all peso-denominated operating expenses, taxes, insurance premiums, other charges, other payments, estimated working capital balance and extraordinary expenses for that calendar month and (ii) transfer such U.S. dollars to the U.S. dollar-denominated Mexico lockbox account. Ty Warner Hotels & Resorts Portfolio Borrower may convert pesos into U.S. dollars more frequently than once per calendar month in its discretion.
 
Property Management. The Four Seasons Santa Barbara Property has been managed by Four Seasons Hotels Limited since 1995 continues to be managed under a management agreement through December 31, 2025, with two remaining fifteen-year extension options. The San Ysidro Property is managed by Ty Warner Hotels & Resorts, LLC, an affiliate of the Sponsor. The Las Ventanas Property has been managed by Rosewood Hotels and Resorts International, Inc. since 2003 and continues to be managed under a management agreement expiring December 2013, with one 10-year renewal option.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
  
 
T-41
 
    
MSC 2012-C4 Ty Warner Hotels & Resorts Portfolio
  
Mezzanine Loan.  At the time of closing of the Ty Warner Hotels & Resorts Portfolio Mortgage Loan, the Sponsor incurred mezzanine financing, secured by equity in the Ty Warner Hotels & Resorts Portfolio Borrower, in the original principal amount of $80 million. The mezzanine loan accrues interest at a rate of LIBOR plus 950 basis points, with a 25 basis point LIBOR floor. The mezzanine loan is interest only for the first 12 months then amortizes on a 30-year schedule based on a 9.75% interest rate. The mezzanine loan borrower is required to make a monthly minimum payment based on an interest rate equal to the greater of (i) 6.00% and (ii) LIBOR plus 500 basis points, provided that to the extent distributable cash flow is greater than this minimum payment amount, the mezzanine loan borrower must use such distributable cash flow to make a monthly interest payment not to exceed the amount at which the mezzanine loan accrues (i.e. LIBOR plus 950). The difference, if any, between the minimum payment amount and the amount at which the mezzanine loan accrues shall be capitalized and added to the outstanding mezzanine loan amount. The mezzanine loan borrower was required to purchase an interest rate cap in the amount of 3.50% for a term of five years. The loan-to-value, underwritten net cash flow debt service coverage and underwritten net operating income debt yield for the combined Ty Warner Hotels & Resorts Portfolio Mortgage Loan and mezzanine loan are 39.2%, 1.29x and 13.8% respectively.
 
The Ty Warner Hotels & Resorts Portfolio intercreditor agreement provides that, among other thing, the holder of the related mezzanine loan has certain rights with respect to the Ty Warner Hotels & Resorts Portfolio Mortgage Loan, including, among others, the following: (i) the holder of the mezzanine loan has the right to cure monetary events of default (up to three (3) times in any twelve (12) month period) under the Ty Warner Hotels & Resorts Portfolio Mortgage Loan within five (5) business days of the later of the giving of notice of the subject event of default by the holder of the Ty Warner Hotels & Resorts Portfolio Mortgage Loan and expiration of the Ty Warner Hotels & Resorts Portfolio Borrower’s cure period (if any); (ii) the holder of the mezzanine loan has the right to cure non-monetary events of default (up to three (3) times in any twelve (12) month period) with respect to the Ty Warner Hotels & Resorts Portfolio Mortgage Loan within any applicable cure period available to the Ty Warner Hotels & Resorts Portfolio Borrower (provided that the holder of the mezzanine loan’s cure period will not begin until the holder of the Ty Warner Hotels & Resorts Portfolio Mortgage Loan delivers notice to the holder of the mezzanine loan of such default), provided, however, if the non-monetary event of default cannot reasonably be cured within such period and the holder of the mezzanine loan commenced curative action within the applicable cure period, and is diligently pursing the cure, then, subject to certain conditions, the holder of the mezzanine loan will be given an additional period of sixty (60) days to cure such non-monetary default; (iii) if (x) the Ty Warner Hotels & Resorts Portfolio Mortgage Loan has been accelerated, (y) any proceeding to foreclose or otherwise enforce the Ty Warner Hotels & Resorts Portfolio Mortgage Loan or other security for the Ty Warner Hotels & Resorts Portfolio Mortgage Loan has been commenced or (z) the Ty Warner Hotels & Resorts Portfolio Mortgage Loan becomes a specially serviced mortgage loan under the terms of the pooling and servicing agreement, then the holder of the mezzanine loan has the right to purchase the Ty Warner Hotels & Resorts Portfolio Mortgage Loan, in whole but not in part, at a price generally equal to the unpaid principal balance of the Ty Warner Hotels & Resorts Portfolio Mortgage Loan, plus accrued and unpaid interest and other amounts due thereon (including, without limitation, any servicing advances and interest charged thereon, plus any expenses incurred in connection with enforcing the Ty Warner Hotels & Resorts Portfolio Mortgage Loan documents and interest on any principal and interest advances made with respect to the Ty Warner Hotels & Resorts Portfolio Mortgage Loan pursuant to the pooling and servicing agreement); (iv) the holder of the Ty Warner Hotels & Resorts Portfolio Mortgage Loan is required to obtain the prior consent of the holder of the mezzanine loan for certain actions (such as a release of the lien of the related mortgage and approval of annual budgets) and for material modifications with respect to the Ty Warner Hotels & Resorts Portfolio Mortgage Loan; and (v) the holder of the mezzanine loan has the right, pursuant to the mezzanine loan documents, under certain circumstances, to cause the Ty Warner Hotels & Resorts Portfolio Borrower to terminate and replace the related property manager. In addition, the intercreditor agreement specifies that the mezzanine loan may be transferred to certain “qualified transferees” (as defined in the intercreditor agreement), however, with respect to the transfer of any or all of the mezzanine loan to a loan pledgee, the intercreditor agreement does not restrict a loan pledgee which is not a qualified transferee from taking title to the pledged equity. See “Risk Factors—A Borrower’s Other Loans May Reduce the Cash Flow Available to the Mortgaged Property Which May Adversely Affect Payments on Your Certificates” in the Free Writing Prospectus.
 
Additional Secured Indebtedness (not including trade debts). Not permitted.
 
Property Releases.  The Ty Warner Hotels & Resorts Portfolio Mortgage Loan documents permit the release of the San Ysidro Property and/or the Las Ventanas Property in connection with partial defeasance, subject to the satisfaction of certain conditions, including, but not limited to, (i) the debt yield with respect to the remaining mortgaged property or properties after giving effect to such defeasance event (assuming a loan amount equal to the outstanding principal balance of the remaining undefeased notes) being equal to at least 19.5%, and (ii) provision of defeasance collateral in an amount equal to the greater of (A) 120% of the allocated principal loan amount in respect of the released property and (B) an amount such that the remaining undefeased notes meet the 19.5% debt yield requirement. Partial release of the Four Seasons Santa Barbara Property is not permitted.
 
Terrorism and Political Risk Insurance.  The Ty Warner Hotels & Resorts Portfolio Borrower is required pursuant to the Ty Warner Hotels & Resorts Portfolio Mortgage Loan documents to maintain (or cause to be maintained) insurance against loss for acts of terrorism with respect to the Ty Warner Hotels & Resorts Portfolio properties and political risk insurance for the Las Ventanas Property (covering expropriatory acts and currency inconvertibility and non-transferability).
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
  
 
T-42
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
   
 
T-43
 
                               
MSC 2012-C4 50 Central Park South
  
 
Mortgage Loan No. 3 – 50 Central Park South
 
(PHOTO)
 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
        
 
T-44
 
       
MSC 2012-C4 50 Central Park South
  
 
Mortgage Loan No. 3 – 50 Central Park South
 
(MAP)
 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
  
 
T-45
 
         
MSC 2012-C4
50 Central Park South
 
Mortgage Loan No. 3 – 50 Central Park South
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset / Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/BBB-/Aaa
  
Property Address:
50 Central Park South
New York, NY 10019
Original Balance(1):
$75,000,000
  
General Property Type:
Commercial Condominium
Cut-off Date Balance:
$75,000,000
  
Detailed Property Type:
Commercial Condominium
% of Initial Pool Balance:
6.8%
  
Net Rentable Area:
234,324 SF
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$320
Borrower Name(s):
MP8 CPS Hotel Owner, LLC
  
Balloon/ARD Balance Per Unit/SF:
$307
Sponsor:
Westbrook Partners and Millennium Partners
  
Year Built / Year Renovated:
1928 / 2002
Mortgage Rate:
5.120%
  
Title Vesting:
Fee
Note Date(2):
9/12/2011
  
Property Manager:
Millennium Partners
First Payment Date:
11/7/2011
      
Anticipated Repayment Date:
10/7/ 2016
    
Maturity Date(3):
10/7/ 2021
  
Underwriting and Financial Information
IO Period:
24 months
  
UW Revenues(4):
$6,500,000
Original Term to Maturity or ARD:
60 months
  
UW Expenses:
$0
Seasoning:
5 months
  
UW NOI:
$6,500,000
Original Amortization Term:
360 months
  
UW NCF:
$6,500,000
Loan Amortization Type:
Partial IO
  
UW NOI DSCR:
1.33x
Interest Accrual Basis:
Actual/360
  
UW NCF DSCR:
1.33x
Prepayment Provisions:
YM1 (29); DEF/YM1 (27); O (4)
  
UW NOI Debt Yield:
8.7%
Lockbox / Cash Management:
Hard / In Place
  
UW NCF Debt Yield:
8.7%
Pari Passu Mortgage Debt:
None
  
UW NCF Debt Yield at Maturity:
9.0%
Subordinate Mortgage Debt:
None
  
Most Recent NOI (As of):
NAP
Mezzanine Debt:
Permitted
  
Second Most Recent NOI (As of):
NAP
     
Third Most Recent NOI (As of):
NAP
Reserves
  
Appraised Value:
$120,000,000
Type
Initial  
Monthly  
Cap  
 
Appraisal As-of Date:
7/1/2011
Tax Reserve:
$0  
Springing  
NAP  
 
Cut-off Date LTV Ratio:
62.5%
Insurance Reserve:
$0  
Springing  
NAP  
 
LTV Ratio at Maturity/ARD:
59.9%
FF&E Reserve:
$0  
Springing  
NAP  
 
Occupancy Rate(5):
NAP
             
             
 
(1)
The Original Balance is as of a January 26, 2012 amended and restated note. On that date, the borrower exercised an option to prepay the subject loan by $5.5 million. The actual original balance as of the Note Date was $80,500,000. No further partial prepayment options exist.
 
(2)
The stated Note Date is the original note date. The original note was amended and restated on January 26, 2012 as a result of a borrower change and a partial loan prepayment as described in footnote 1 above.
 
(3)
The potential hyper-amortization period is limited to five years.
 
(4)
UW Revenues equal the current fixed rent under the net lease of the mortgaged property, net of a fixed operating allowance credited the tenant thereunder. On November 1, 2020, such rental rate, net of such operating allowance, increases to $7,000,000 per annum for the remainder of the lease term.
 
(5)
The property is net leased in whole to a hotel owner and operator.
 
The 50 Central Park South Mortgage Loan.
 
The Mortgage Loan.  The third largest mortgage loan (the “50 Central Park South Mortgage Loan”) is a refinance loan evidenced by a note in the original principal amount of $75,000,000, and is secured by a first priority fee mortgage encumbering the commercial condominium unit consisting of floors 2-21 and portions of the ground level, basement and sub-basement levels of the building located at 50 Central Park South, New York, New York (the “50 Central Park South Property”). The 50 Central Park South Mortgage Loan refinanced and paid off the previous loan secured by the 50 Central Park South Property, which was included in the WBCMT 2003-C6 CMBS transaction.
 
The 50 Central Park South Mortgage Loan had an initial term of 60 months and a remaining term of 55 months. The 50 Central Park South Mortgage Loan requires payments of interest only for its initial 24 months, and principal and interest for its final 36 months, with an Anticipated Repayment Date of October 7, 2016. Voluntary prepayment of the 50 Central Park South Mortgage Loan is permitted in
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-46
 
 
MSC 2012-C4
50 Central Park South
 
whole only on any date together with a yield maintenance premium and, if the prepayment is made other than on the due date, interest that would have accrued through the next due date. Defeasance with direct, non-callable obligations of the United States of America (or other non-callable government securities or other non-callable instruments that will not cause the trust to lose its REMIC status and which, in each case, will not result in a downgrade or withdrawal of the ratings for the REMIC securities) is permitted at any time on or after the first due date following the second anniversary of the securitization closing date. The 50 Central Park South Mortgage Loan is open to prepayment at par without any yield maintenance premium during the final 3 months of the loan term.
 
The Borrower and the Sponsor.  The borrower is MP8 CPS Hotel Owner, LLC, a single-purpose Delaware limited liability company with two independent directors (the “50 Central Park South Borrower”). The 50 Central Park South Mortgage Loan sponsors are Westbrook Partners (“Westbrook”) and Millennium Partners (“Millennium”), and the non-recourse carve-out guarantors are Christopher M. Jeffries and Millennium CAF II, LLC. Westbrook is a private, fully integrated real estate investment management company founded in 1994 with offices in New York, Boston, Washington, DC, Palm Beach, San Francisco, Los Angeles, London, Paris & Tokyo. Westbrook’s experience includes the operation and management of office, multi-family residential, hotel, retail, industrial and single-family residential development properties. Millennium was founded in 1991. Since this time, Millennium has developed approximately 1,600 residential units, eight hotels, approximately 1,000,000 SF of office space, and 1,200,000 SF of retail space.
 
The Mortgaged Property. The 50 Central Park South Property is a commercial condominium unit that operates as a 234,324 square foot, 259-room luxury hotel with restaurant, lounge, spa, gym and meeting space. No commercial condominium tenant operations or income serve as collateral for the 50 Central Park South Mortgage Loan. In addition to the 50 Central Park South Property, the top 13 stories of the building at 50 Central Park South consist of residential condominium units that are not collateral for the 50 Central Park South Mortgage Loan. The improvements were built in 1928 and renovated in their entirety in 2002.
 
Net Lease.  Pursuant to a lease dated October 31, 2000 (the “Net Lease”), 100% of the 50 Central Park South Property is net leased to MPE Hotel I (New York) LLC (the “MPE”), an affiliate of the 50 Central Park South Borrower, through October 31, 2075, with no extensions. The Net Lease obligates MPE to pay all taxes, common charges, operating expenses and insurance relating to the 50 Central Park South Property. The annual net rent payable under the Net Lease, net of a fixed operating allowance credited to MPE thereunder, is currently $6,500,000. On November 1, 2020, such annual net rent, net of such fixed operating allowance, increases to $7,000,000, where it remains until the lease expiration on October 31, 2075.
 
 
The Market.  The 50 Central Park South Property is located on Central Park South (“CPS”) (a/k/a 59th Street), at the southeast corner of CPS and Sixth Avenue in midtown Manhattan and faces New York City’s Central Park. The neighborhood is known as the Plaza District and is a prime office and commercial locale in the north-central area of Midtown in New York City. Nearby landmarks include the Plaza Hotel and the Pierre Hotel. Below is a table of competitive commercial properties:
 
Competitive Property Summary
Property
Sale Date
Price   
Frontage
Lot Size    
Maximum Bldg.    
Area (SF)    
 Unit Price/FAR  
49-55 Amsterdam Avenue
January 2011
$125,000,000    
Corner Parcel
9,644    
409,889    
$304.96
447-457 Lexington Avenue
November 2010
$41,200,000    
Corner Parcel
7,532    
112,980    
$364.67
678 Lexington Avenue
March 2010
$33,866,667    
Corner Parcel
7,289    
87,468    
$387.19
440 Park Avenue
January 2010
$305,410,069    
Corner Parcel
32,691    
531,284    
$574.85
313-317 East 46th Street
November 2009
$45,000,000    
Midblock Parcel
7,533    
90,396    
$497.81
 
Source: Appraisal
 
Escrows and Reserves. As a result of the Net Lease, which obligates MPE to pay all taxes, insurance, common charges and operating expenses relating to the 50 Central Park South Property, there are no escrows or other reserves for the 50 Central Park South Mortgage Loan, unless there is a Net Lease termination. If a Net Lease termination occurs, the 50 Central Park South Borrower will be required to escrow 1/12 of the annual estimated tax payments and insurance premiums monthly and to make monthly deposits for FF&E reserves equal to the greater of (i) 4.0% of the gross revenue for the second full calendar month prior to the monthly payment date in question and (ii) the amount required for FF&E by the hotel operating agreement for such period.
 
Lockbox and Cash Management. A hard lockbox is in place with respect to the 50 Central Park South Mortgage Loan. The 50 Central Park South Mortgage Loan has in place cash management. Funds in the lockbox account are applied on each monthly payment date to make debt service payments on the 50 Central Park South Mortgage Loan and to remit any excess to the 50 Central Park South Borrower.
 
Property Management. The 50 Central Park South Property is managed by Millennium, which is an affiliate of both the 50 Central Park South Borrower and MPE. MPE operates the 50 Central Park South Property as a luxury hotel pursuant to a separate operating agreement with The Ritz-Carlton Hotel Company that is co-terminus with the Net Lease.
 
Mezzanine Loan and Preferred Equity.  The owner of the 50 Central Park South Borrower has the right to incur future mezzanine debt secured by its ownership interest in the 50 Central Park South Borrower provided that, among other things, (i) the aggregate amount of the 50 Central Park South Mortgage Loan and such mezzanine loan shall not exceed $95,000,000, (ii) the aggregate debt
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-47
 
 
MSC 2012-C4
50 Central Park South
 
service ratio of the 50 Central Park South Mortgage Loan and such mezzanine loan shall not be less than 1.00x and (iii) the mezzanine loan lender is a permitted mezzanine lender under the 50 Central Park South Mortgage Loan documents.
 
Additional Secured Indebtedness (not including trade debts).  Not permitted.
 
Release of Parcels. Not permitted.
 
Terrorism Insurance.  Generally, the 50 Central Park South Borrower is required to maintain (or cause MPE to maintain under the Net Lease) insurance against loss for acts of terrorism with respect to the 50 Central Park South Property.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-48
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-49
 
 
MSC 2012-C4
Capital City Mall
 
Mortgage Loan No. 4 – Capital City Mall
 
GRAPHIC
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-50
 
 
MSC 2012-C4
Capital City Mall
 
Mortgage Loan No. 4 – Capital City Mall
 
GRAPHIC
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-51
 
 
MSC 2012-C4
Capital City Mall
 
Mortgage Loan No. 4 – Capital City Mall
 
MAP
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-52
 
 
MSC 2012-C4
Capital City Mall
 
Mortgage Loan No. 4 – Capital City Mall
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
BANA
  
Single Asset / Portfolio:
Single Asset
Credit Assessment (DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
3506 Capital City Mall Drive
Camp Hill, PA 17011
Original Balance:
$65,750,000
  
General Property Type:
Retail
Cut-off Date Balance:
$65,750,000
  
Detailed Property Type:
Regional Mall
% of Initial Pool Balance:
6.0%
  
Net Rentable Area:
488,769 SF
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$135
Borrower Name(s):
PR Capital City Limited Partnership
  
Balloon/ARD Balance Per Unit/SF:
$112
Sponsor:
PREIT Associates, L.P.
  
Year Built / Year Renovated:
1979 / 2005
Mortgage Rate:
5.296%
  
Title Vesting(1):
Fee
Note Date:
2/17/2012
  
Property Manager:
PREIT Services, LLC
First Payment Date:
4/1/2012
      
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
3/1/2022
  
UW Revenues:
$12,773,085
IO Period:
None
  
UW Expenses:
$5,355,038
Original Term to Maturity or ARD:
120 months
  
UW NOI:
$7,418,047
Seasoning:
0 months
  
UW NCF:
$6,790,012
Original Amortization Term:
360 months
  
UW NOI DSCR:
1.69x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.55x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
11.3%
Prepayment Provisions:
LO (24); DEF (92); O (4)
  
UW NCF Debt Yield:
10.3%
Lockbox/Cash Management:
Hard / Springing
  
UW NCF Debt Yield at Maturity:
12.4%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$8,216,958 (12/31/2011)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$7,774,947 (12/31/2010)
Mezzanine Debt:
None
  
Third Most Recent NOI (As of):
$8,428,151 (12/31/2009)
Reserves
  
Appraised Value:
$105,000,000
Type
Initial  
Monthly  
Cap  
 
Appraisal As-of Date:
1/18/2012
Tax Reserve:
$426,966  
$83,339  
NAP  
 
Cut-off Date LTV Ratio:
62.6%
Insurance Reserve(2):
$0  
Springing  
NAP  
 
LTV Ratio at Maturity/ARD:
52.1%
Replacement Reserve(2):
$750,000  
$34,621  
NAP  
 
Occupancy Rate:
97.1% (1/31/2012)
TI/LC Reserve:
$0  
$35,026  
NAP  
 
2nd Most Recent Occupancy:
97.7% (12/31/2010)
         
3rd Most Recent Occupancy:
98.1% (12/31/2009)
 
(1)
The Capital City Mall Mortgage Loan is secured by a leasehold interest whereby the fee owner is a borrower-related entity and such borrower-related entity has pledged the fee interests as security for the Capital City Mall Mortgage Loan.
 
(2)
The Capital City Mall Borrower is required to escrow $34,621 monthly for replacement reserves through and including the payment date occurring in April 2017. The Capital City Mall Borrower will also be required to escrow for insurance should the Capital City Mall Property no longer be covered by a blanket insurance policy. See “—Escrows and Reserves” below.
 
The Capital City Mall Mortgage Loan.
 
The Mortgage Loan.  The fourth largest mortgage loan (the “Capital City Mall Mortgage Loan”) is a refinance loan evidenced by a note in the original principal amount of $65,750,000, and is secured by a first priority fee mortgage encumbering a regional mall known as Capital City Mall in Camp Hill, Pennsylvania (the “Capital City Mall Property”). The Capital City Mall Mortgage Loan was originated on February 17, 2012 by or on behalf of Bank of America, National Association.
 
The Capital City Mall Mortgage Loan had an initial term of 120 months and has a remaining term of 120 months. The Capital City Mall Mortgage Loan requires payments of principal and interest for its entire term with a scheduled maturity date of March 1, 2022. Defeasance with direct, non-callable obligations of the United States of America is permitted at any time on or after the first due date following the second anniversary of the securitization closing date. The Capital City Mall Mortgage Loan is open to prepayment at par during the final 3 months of the loan term.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-53
 
 
MSC 2012-C4
Capital City Mall
 
The Borrower and the Sponsor.  The borrower is PR Capital City Limited Partnership, a single-purpose Pennsylvania limited partnership with two independent directors (the “Capital City Mall Borrower”). The Capital City Mall Borrower is owned by PREIT Associates, L.P. (99.5% limited partner) and PR Capital City, LLC (0.5% general partner). The sponsor and non-recourse guarantor of the Capital City Mall Mortgage Loan is PREIT Associates, L.P.
 
Pennsylvania Real Estate Investment Trust (“PREIT”) (NYSE: PEI) is an equity real estate investment trust founded in 1960 and headquartered in Philadelphia, Pennsylvania. PREIT has a primary investment focus on retail shopping malls and has a current portfolio of 38 shopping malls, eight community centers and three development properties located in the eastern half of the United States, primarily in the Mid-Atlantic region.
 
The Mortgaged Property. The Capital City Mall Property consists of 488,769 square feet of the approximately 608,930 SF regional mall known as Capital City Mall, located in Camp Hill, Pennsylvania. The Capital City Mall Property, which was built in 1979 and renovated in 2005, is located in the northeast quadrant of the intersection of U.S. Route 15 and the Lower Allen Drive in the west side of the Harrisburg-Carlisle core based statistical area.
 
The Capital City Mall Property consists of approximately 84 tenants, including two anchor tenants, J.C. Penney and Sears, as well as a Toys“R”Us outparcel. The Capital City Mall Property also includes a 120,161 SF non-owned Macy’s anchor. Other major tenants include Old Navy, Gap/Gap Kids, Charlotte Russe, Forever 21, Hollister Co., Victoria’s Secret, The Limited and Bath & Body Works. The Capital City Mall Property has 2,151 surface parking spaces, which equates to a parking ratio of 4.40 spaces per 1,000 square feet of net rentable area.
 
As of January 31, 2012, the Capital City Mall Property was 97.1% occupied and 97.7% occupied including the Macy’s non-owned anchor. The historical occupancy at the Capital City Mall Property was 97.7% as of December 31, 2010, 98.1% as of December 31, 2009 and 98.3% as of December 31, 2008. In-line store sales as of the trailing-twelve months ended December 31, 2011 were approximately $353 PSF, which represents an occupancy cost of 11.9%. The reported year end 2010 and 2009 sales were approximately $347 PSF and $345 PSF, respectively.
 
Anchor and Major Tenants.
 
J.C. Penney Company Inc. (102,825 SF, 21.0% NRA, 5.2% of underwritten base rent). J.C. Penney Company, Inc. (“J.C. Penney”) occupies 102,825 SF at the Capital City Mall Property under a lease expiring on November 30, 2015 with five, five-year extension options. The lease provides for a rental rate of $4.15 PSF. J.C. Penney (NYSE: JCP) is a department store operator that sells family apparel and footwear accessories, fin and fashion jewelry, beauty products and home furnishings. Founded in 1902 and based in Plano, Texas, as of December 7, 2011, J.C. Penney operated approximately 1,100 department stores throughout the United States and Puerto Rico. As of the year ended January 29, 2011, J.C. Penney reported revenue of approximately $17.8 billion and net income of approximately $389.0 million.  J.C. Penney is currently rated “BB+” by Fitch and “BB+” by S&P. J.C. Penney reported sales at the Capital City Mall Property of $106 PSF for the year ended December 31, 2011.
 
Sears Holdings Corporation (101,476 SF, 20.8% of NRA, 2.4% of underwritten base rent). Sears Holdings Corporation (“Sears”) occupies 101,476 SF at the Capital City Mall Property under a lease expiring on July 28, 2014 with three, five-year extension options. The lease provides for a rental rate of $1.91 PSF and percentage rent of 2.0% of net sales greater than approximately $8.6 million but less than $10 million, 1.75% of net sales greater than $10 million and 1.5% of net sales greater than $11.5 million. Sears (NASDAQ: SHLD) is the nation’s fourth largest broad-line retailer with over 4,000 full-line and specialty retail stores in the United States and Canada. Sears is a leading retailer of home appliances, tools, lawn and garden, consumer electronics and automotive repair and maintenance. As of the year ended January 29, 2011, Sears reported revenue of approximately $43.3 billion and net income of approximately $133.0 million. Sears is currently rated “B+” by Fitch, “B3” by Moody’s and “CCC+” by S&P. Sears reported sales at the Capital City Mall Property of $154 PSF for the year ended December 31, 2011.
 
Toys“R”Us, Inc. (46,158 SF; 9.4% of NRA, 2.4% of underwritten annual base rent). Toys“R”Us, Inc. (“Toys“R”Us”) occupies 46,158 SF on an out-parcel at the Capital City Mall Property under a lease expiring on January 31, 2015 with four, five-year extension options. The lease provides for a rental rate of $4.19 PSF. Toys“R”Us is a toy and juvenile products retailer offering merchandise through 873 Toys“R”Us and Babies“R”Us stores in the United States and Puerto Rico, and in more than 600 international stores in 35 countries. Toys“R”Us is currently rated “B” by Fitch, “B1” by Moody’s and “B” by S&P. Toys“R”Us has recently decided to cease operations at the Capital City Mall Property location, however, Toys“R”Us is obligated to continue to pay rent until their lease maturity and has no termination options.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-54
 
 
MSC 2012-C4
Capital City Mall
  
The following table sets forth further information regarding major tenants at the Capital City Mall Property:
 
Anchor and Major Tenant Summary
 
Credit Rating
(Fitch/Moody’s/S&P)(1)
Tenant NRSF  
% of NRSF  
Total Annual  
Underwritten  
Rent PSF  
% of Total  
Annual   
Underwritten  
Rent  
Lease  
Expiration  
2011  
Sales PSF  
Occupancy  
Cost as % of  
Sales  
Anchors
                
J.C. Penney
BB+/NR/BB+
102,825  
21%  
$4.15  
6%  
11/30/2015  
$106  
8.5%  
Sears
CCC/B3/CCC+
101,476  
21%  
$1.91  
3%  
7/28/2014  
$154  
5.0%  
Toys“R”Us(2)
B/B1/B
46,158  
9%  
$4.19  
3%  
1/31/2015  
NAV  
—  
Subtotal / Wtd. Avg.
  
250,459  
51%  
$3.25  
11%  
      
                 
Major Tenants
                
Old Navy
BBB-/Baa3/BB+
17,428  
4%  
$11.00  
3%  
  MTM(3)   
$189  
5.8%  
Gap/Gap Kids
BBB-/Baa3/BB+
8,978  
2%  
$25.00  
3%  
4/30/2015  
$171  
17.0%  
Express
NR/NR/BB-
7,944  
2%  
$28.00  
3%  
1/31/2016  
$325  
13.7%  
Charlotte Russe
  
7,410  
2%  
$17.31  
2%  
1/31/2014  
$144  
14.7%  
Forever 21
  
6,873  
1%  
$19.00  
2%  
8/31/2016  
$349  
11.8%  
Hollister Co.  
  
6,560  
1%  
$25.00  
2%  
4/30/2016  
$287  
10.1%  
Victoria’s Secret
BB+/Ba2/BB+
6,442  
1%  
$28.00  
2%  
1/31/2016  
$570  
7.9%  
The Limited
BB+/Ba2/BB+
6,338  
1%  
$15.78  
1%  
3/31/2012  
$207  
9.5%  
Subtotal / Wtd. Avg.
  
67,973  
14%  
$19.74  
18%  
      
                 
Other Tenants
  
154,815  
32%  
$34.55  
71%  
      
Vacant Space
  
15,522  
3%  
$0.00  
0%  
      
Total / Wtd. Avg.
  
488,769  
100%  
$15.86  
100%  
      
                 
Non-Collateral Anchors
                
Macy’s
BBB-/Baa3/BBB-
120,161  
           
Total
  
608,930  
           
 
(1)
Certain ratings are those of the parent company whether or not the parent guarantees the lease.
 
(2)
Toys“R”Us has recently decided to cease operations at the Capital City Mall Property location, however, Toys“R”Us is obligated to continue to pay rent until their lease maturity and has no termination options.
 
(3)
The Capital City Mall Borrower has a lease out for renewal to Old Navy through 12/31/2014.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-55
 
 
MSC 2012-C4
Capital City Mall
 
The following table presents certain information relating to the lease rollover at the Capital City Mall Property:
 
Lease Rollover Schedule(1)(2)
Year
# of Leases Rolling
Square Feet Rolling
Average Underwritten
Base Rent PSF
Rolling(3)
Approx.
% of Total
Square Feet
Rolling
Approx.
Cumulative %
of SF Rolling
Total
Underwritten
Base Rent
Rolling
Approx.
% of Total
Base Rent
 Rolling
Approx.
Cumulative % of
Total Base Rent
Rolling
MTM
10
21,194
$22.68
4%
4%
$480,708
6%
6%
2012
11
36,789
$26.14
8%
12%
$961,841
13%
19%
2013
13
25,030
$28.22
5%
17%
$706,370
9%
29%
2014
4
116,824
$4.44
24%
41%
$518,140
7%
36%
2015
19
177,642
$10.08
36%
77%
$1,789,980
24%
59%
2016
16
56,743
$30.77
12%
89%
$1,746,195
23%
83%
2017
8
13,337
$45.30
3%
92%
$604,137
8%
91%
2018
4
14,760
$29.08
3%
95%
$429,176
6%
96%
2019
1
595
$67.00
0%
95%
$39,865
1%
97%
2020 & Beyond
3
10,333
$22.14
2%
97%
$228,774
3%
100%
Vacant
0
15,522
$0.00
3%
100%
$0
0%
100%
Total / Wtd. Avg.
89
488,769
$15.86
100%
  
$7,505,186
100%
  
 
(1)
The information in the lease rollover schedule is based on the underwritten rent roll.
 
(2)
Certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date of the subject lease and that are not considered in the lease rollover schedule.
 
(3)
Average Base Rent PSF Rolling excludes vacant space.
 
The Market.  The Capital City Mall Property is located in Camp Hill, Pennsylvania in the western portion of the Harrisburg-Carlisle core based statistical area (“CBSA”). The Capital City Mall Property is located just off of U.S. Route 15 and U.S. Route 11 and is the focal point in a concentration of retail shopping centers that includes Capital City Commons, Camp Hill Center, Capital City Plaza and Harrisburg West Shopping Center.
 
The Harrisburg-Carlisle CBSA had a 2011 estimated population of approximately 544,793 with an average household income of approximately $66,256. As of 2011, the estimated population within a five, 10 and 15 mile radius of the Capital City Mall Property was approximately 157,652, 328,001 and 486,398 respectively. As of 2011, the estimated average household income within a five, 10 and 15 mile radius of the Capital City Mall Property was approximately $66,016, $67,918 and $68,772, respectively.
 
Employment in Harrisburg, Pennsylvania is concentrated in government, education and health services, professional and business services and retail trade, representing 19.3%, 15.2%, 12.1% and 9.9% of total employment, respectively. As of 2010, Harrisburg had an unemployment rate of 7.8%. Hershey Entertainment & Resorts (8,200 employees), Penn State Hershey Medical Center (7,291 employees), Giant Food Stores (7,000 employees) and The Hershey Company (6,500 employees) are the four largest employers in Harrisburg.
 
The two primary competing properties to the Capital City Mall Property are shown in the table below.
 
Competitive Property Summary
Property
Center Type
Competition
Year Built /
Renovated
Total GLA
Anchor Tenants
Sales/SF
Occupancy
Proximity
Colonial Park Mall
Regional Center
Primary
1960 / 1990
743,497
The Bon-Ton, Boscov’s,
Sears, Cinema
$257
94%
11 miles
Harrisburg East Mall
Super-Regional Center
Primary
1969 / 2004
983,705
Bass Pro Shops, Macy’s,
Cinema
$200
70%
8 miles
 
Source: Appraisal
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-56
 
 
MSC 2012-C4
Capital City Mall
 
Operating History and Underwritten Net Cash Flow.  The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Capital City Mall Property:
 
Cash Flow Analysis
  
   
2009
  
2010
  
2011
  
UW
  
UW PSF
  
Gross Potential Rent
  
$7,641,230
  
$7,453,677
  
$7,525,641
  
$8,173,038
  
$16.72
  
Percentage Rent
  
$212,888
  
$227,731
  
$180,087
  
$175,432
  
$0.36
  
Specialty Leasing
  
$449,434
  
$496,232
  
$500,524
  
$419,650
  
$0.86
  
Marketing
  
$282,050
  
$259,246
  
$249,370
  
$246,799
  
$0.50
  
Total Reimbursements
  
$3,976,343
  
$4,015,457
  
$4,196,527
  
$4,604,037
  
$9.42
  
Other Income
  
$313,965
  
$190,450
  
$186,231
  
$164,508
  
$0.34
  
Less Vacancy & Credit Loss
  
($88,207)
  
($129,153)
  
($44,341)
  
($1,010,380)
  
($2.07)
  
Effective Gross Income
  
$12,787,703
  
$12,513,640
  
$12,794,039
  
$12,773,085
  
$26.13
  
Total Operating Expenses
  
$4,359,552
  
$4,738,693
  
$4,577,081
  
$5,355,038
  
$10.96
  
Net Operating Income
  
$8,428,151
  
$7,774,947
  
$8,216,958
  
$7,418,047
  
$15.18
  
TI/LC
  
$0
  
$0
  
$0
  
$420,308
  
$0.86
  
Capital Expenditures
  
$0
  
$0
  
$0
  
$207,727
  
$0.43
  
Net Cash Flow
  
$8,428,151
  
$7,774,947
  
$8,216,958
  
$6,790,012
  
$13.89
  
                       
Occupancy %(1)
  
98.1%
  
97.7%
  
96.8%
  
92.2%
      
NOI DSCR
  
1.92x
  
1.78x
  
1.88x
  
1.69x
      
NCF DSCR
  
1.92x
  
1.78x
  
1.88x
  
1.55x
      
NOI Debt Yield
  
12.8%
  
11.8%
  
12.5%
  
11.3%
      
NCF Debt Yield
  
12.8%
  
11.8%
  
12.5%
  
10.3%
      
Average Annual Rent PSF
  
$15.63
  
$15.25
  
$15.40
  
$16.72
      
 
(1) The occupancy rate is based on the Capital City Mall Property only and does not include the Macy’s non-collateral anchor store.
 
Escrows and Reserves.  The Capital City Mall Borrower deposited $426,966 in escrow for annual real estate taxes at loan origination and is required to escrow $83,339 monthly. The Capital City Mall Borrower maintains insurance under an acceptable blanket policy. If such blanket policy is discontinued, the Capital City Mall Borrower is required to escrow 1/12 of the estimated insurance premiums monthly. The Capital City Mall Borrower deposited $750,000 at loan origination for replacement reserves and is also required to escrow $34,621 monthly through and including the payment date occurring in April 2017. In addition, the Capital City Mall Borrower is required to escrow $35,026 monthly for TI/LC reserves.
 
Lockbox and Cash Management. A hard lockbox is in place with respect to the Capital City Mall Mortgage Loan. The Capital City Mall Mortgage Loan has springing cash management. Provided a Cash Sweep Period has not commenced and is continuing, funds in the lockbox account are swept daily to an account designated by the Capital City Mall Borrower. In addition, the Capital City Mall Borrower will be required to deposit all excess cash with respect to the Capital City Mall Mortgage Loan to be held by the mortgagee as additional security for the Capital City Mall Mortgage Loan during a Cash Sweep Period. A “Cash Sweep Period” exists (i) during the continuance of a default by Cash Sweep Tenant with respect to payment of rent under its respective lease, (ii) when a Cash Sweep Tenant vacates, provides notice that it is not exercising any extension option, or fails to exercise an extension option by such date as required under the terms of its lease and ending on a Vacancy Satisfaction Event, (iii) the debt service coverage ratio for the immediately preceding twelve month period is less than 1.15x and ending on the date the debt service coverage ratio equals or exceeds 1.25x for the immediately preceding twelve month period. A “Cash Sweep Tenant” shall mean any lease, which individually or when aggregated with other leases at the Capital City Mall Property with the same tenant or its affiliate, demises 50,000 SF or more of the Capital City Mall Property’s gross leasable area. “Vacancy Satisfaction Event” shall mean, in the event a Vacancy Event has occurred, the occurrence of either (x) excess cash equal to at least two years of full unabated contractual rent otherwise payable by the applicable Cash Sweep Tenant has been deposited into the excess cash reserve account or (y) mortgagee’s receipt and approval of each of the following items, each of which must be reasonably acceptable to mortgagee in all respects: (i) evidence that substantially all of the space at the Capital City Mall Property which is the subject of a Vacancy Event (as defined in the related loan agreement) has been leased to one or more replacement tenants reasonably acceptable to mortgagee in accordance with the terms and conditions of the Capital City Mall Mortgage Loan documents; (ii) a written estoppel certificate executed by each replacement tenant which is in form reasonably acceptable to mortgagee; (iii) a subordination, non-disturbance and attornment agreement; (iv) evidence that such replacement tenant has paid, without offset or abatement, the first full month’s rent pursuant to its respective lease; (v) evidence that no material unfunded landlord obligations exist with respect to any replacement tenant’s lease; (vi) if applicable, a certificate of occupancy for the portion of the Capital City Mall Property leased to such replacement tenant; and (vii) such other documents as mortgagee may reasonably require.
 
Property Management. The Capital City Mall Property is managed by PREIT Services, LLC, an affiliate of the Capital City Mall Mortgage Loan Borrower.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-57
 
 
MSC 2012-C4
Capital City Mall
 
Mezzanine Loan and Preferred Equity.  Not permitted.
 
Additional Secured Indebtedness (not including trade debts). Not permitted.
 
Release of Parcels.  The Capital City Mall Mortgage loan documents permit the release of an identified out-parcel that is subject to the lien of the related mortgage, subject to the satisfaction of certain conditions, including, but not limited to:  (i) the debt service coverage ratio of the remaining Mortgaged Property for the preceding twelve calendar months must be greater than (A) the debt service coverage ratio for the entire Mortgaged Property (including the out-parcel) immediately prior to such release and (B) 1.15x, (ii) the Capital City Mall Borrower must either (A) prepay a portion of the outstanding principal balance of the related note in an amount equal to the “Out-Parcel Release Price” (as defined in the loan agreement) together with a yield maintenance premium (provided that following such prepayment the ratio of the unpaid principal balance of the Capital City Mall Mortgage Loan to the value of the remaining Mortgaged Property may not be greater than 125% or (B) partially defease the Capital City Mall Mortgage Loan in an amount equal to the “Out-Parcel Release Price” (as defined in the loan agreement) (and provide a REMIC opinion with respect to such partial defeasance), and (iii) execution of an amendment to the related ground lease removing such out-parcel from such ground lease.
 
Terrorism Insurance.  The Capital City Mall Borrower is required pursuant to the Capital City Mall Mortgage Loan documents to maintain (or cause to be maintained) insurance against loss for acts of terrorism with respect to the Capital City Mall Property.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-58
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(THIS PAGE INTENTIONALLY LEFT BLANK)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-59
 
 
MSC 2012-C4
ELS Portfolio
 
Mortgage Loan No. 5 – ELS Portfolio
 
(PHOTO)
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-60
 
 
MSC 2012-C4
ELS Portfolio
 
Mortgage Loan No. 5 – ELS Portfolio
 
(MAP)
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-61
 
 
MSC 2012-C4
ELS Portfolio
 
Mortgage Loan No. 5 – ELS Portfolio
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Portfolio
Credit Assessment
(DBRS/KBRA/Moody’s):
AA/A/A2
  
Property Location(4):
Various
Original Balance:
$63,747,000
  
General Property Type:
Manufactured Housing
Cut-off Date Balance:
$63,747,000
  
Detailed Property Type:
Manufactured Housing
% of Initial Pool Balance:
5.8%
  
Number of Units/SF:
2,843 Pads
Loan Purpose(1):
Refinance/Acquisition
  
Cut-off Date Balance Per Unit/SF:
$22,422
Borrower Name(s)(2):
Various
  
Balloon/ARD Balance Per Unit/SF:
$19,505
Sponsor:
Equity Lifestyle Properties, Inc.
  
Year Built / Year Renovated(4):
Various / NAP
Mortgage Rate:
5.282%
  
Title Vesting:
Fee
Note Date:
12/15/2011
  
Property Manager:
MHC Operating Limited Partnership
First Payment Date:
1/1/2012
      
Anticipated Repayment Date:
NAP
      
Maturity Date:
11/1/2021
  
Underwriting and Financial Information
IO Period:
21 months
  
UW Revenues:
$16,110,905
Original Term to Maturity or ARD:
119 months
  
UW Expenses:
$5,623,539
Seasoning:
3 months
  
UW NOI:
$10,487,365
Original Amortization Term:
360 months
  
UW NCF:
$10,345,215
Loan Amortization Type:
Partial IO
  
UW NOI DSCR:
2.47x
Interest Accrual Basis:
Actual/360
  
UW NCF DSCR:
2.44x
Prepayment Provisions:
LO (27); DEF (88); O (4)
  
UW NOI Debt Yield:
16.5%
Lockbox/Cash Management:
Hard / In Place
  
UW NCF Debt Yield:
16.2%
Pari Passu Mortgage Debt:
None
  
UW NCF Debt Yield at Maturity:
18.7%
Subordinate Mortgage Debt:
None
  
Most Recent NOI (As of):
$11,369,732 (12/31/2011)
Mezzanine Debt:
None
  
Second Most Recent NOI (As of):
$11,004,632 (12/31/2010)
     
Third Most Recent NOI (As of):
$10,394,463 (12/31/2009)
Reserves
  
Appraised Value:
$154,740,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
Various (6/14/2011 - 7/8/2011)
Tax Reserve(3):
$0
Springing
NAP   
  
Cut-off Date LTV Ratio:
41.2%
Insurance Reserve(3):
$0
Springing
NAP   
  
LTV Ratio at Maturity/ARD:
35.8%
Replacement Reserve(3):
$0
Springing
NAP   
  
Occupancy Rate (As of):
91.3% (12/31/2011)
Def. Maint. Reserve:
$157,891
$0
NAP   
  
2nd Most Recent Occupancy (As of):
92.4% (12/31/2010)
Permitted Advance Rent Reserve(3):
$0
Springing
NAP   
  
3rd Most Recent Occupancy (As of):
90.9% (12/31/2009)
 
(1)
Five of the ELS Portfolio Properties were refinanced; three were acquisitions.
 
(2)
There are eight separate borrowing entities. See “—The Borrower and Sponsor” below for a full list.
 
(3)
Certain escrows are required during a Trigger Period. See “—Escrows and Reserves” below for details.
 
(4)
The ELS Portfolio includes eight manufactured housing properties in six states with various construction/renovation dates. See “—The Mortgaged Property” table below.
 
The ELS Portfolio Mortgage Loan.
 
The Mortgage Loan. The fifth largest mortgaged loan (the “ELS Portfolio Mortgage Loan”) is both a refinance and acquisition loan evidenced by a note in the original principal amount of $63,747,000, and is secured by first priority fee mortgages encumbering seven manufactured housing communities and one modular and RV community in six different states (collectively, the “ELS Portfolio Property”).
 
The ELS Portfolio Mortgage Loan had an initial term of 119 months and has a remaining term of 116 months. The ELS Portfolio Mortgage Loan requires payments of interest only for its initial 21 months, and principal and interest for the remaining 98 months, with a scheduled maturity date of November 1, 2021. Defeasance with direct, non-callable obligations of the United States of America (or other non-callable government securities or other non-callable instruments that will not cause the trust to lose its REMIC status and which, in each case, will not result in a downgrade or withdrawal of the ratings for the REMIC securities) is permitted at any time on or after the first due date following the second anniversary of the securitization closing date. The ELS Portfolio Mortgage Loan is open to prepayment at par during the final 3 months of the loan term.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-62
 
 
MSC 2012-C4
ELS Portfolio
 
The Borrower and Sponsor. The borrowers are MHC Palm Shadows, L.L.C, MHC Rancho Valley Limited Partnership, MHC Royal Coachman, L.L.C., MHC Boulder Cascade, L.L.C., MHC Cabana, L.L.C., MHC Hillcrest-MA, L.L.C., MHC Parkwood Communities, L.L.C., and MHC Regency Lakes, L.L.C., seven single purpose Delaware limited liability companies, each with two independent directors, and one Delaware limited partnership (collectively, the “ELS Portfolio Borrower”). The ELS Portfolio Borrower is controlled and majority owned by Equity LifeStyle Properties, Inc. (“ELS”).
 
The ELS Portfolio Mortgage Loan sponsor is ELS, and the nonrecourse carve-out guarantor is MHC Operating Limited Partnership, the sponsor’s operating partnership. The total liability under the nonrecourse carve-out guarantee is limited to $25,000,000. Equity LifeStyle Properties (NYSE: ELS) is a Chicago based, self-administered, self-managed real estate investment trust (REIT), which, as of January 23, 2012, reported a controlling interest in 382 properties in 32 states and British Columbia, consisting of 141,175 sites. The company is headquartered in Chicago, IL, with regional offices in Tampa Bay, FL, Aurora, CO and Phoenix, AZ.
 
The Mortgaged Property. The ELS Portfolio Property consists of 2,843 pad sites in 8 lifestyle community properties in Florida, Nevada, Virginia, Arizona, California and Massachusetts. Five of the properties were previously owned and operated by ELS, while 3 were newly acquired in 2011. Each property provides a variety of amenities including golf courses, swimming pools and spas, clubhouses, exercise equipment and laundry facilities. Four of the eight ELS Portfolio Properties are officially 55+ age-restricted communities.
 
The Royal Coachman property is a combination modular and RV community located just west of I-75 in Nokomis, FL, approximately 17 miles southeast of the Sarasota CBD. Of the 546 pads, 412 are occupied as modular park models and 155 are allocated for RV rentals. While the Royal Coachman property is not officially age-restricted, over 95% of the tenants are retired and less than 1% are families. The immediate area predominately consists of detached single-family homes and mobile homes. Residences in the area were typically built between the 1960s and 1980s, with an average home price of $123,736.
 
The Regency Lakes property is an all-age family manufactured housing community situated on 165.4 acres just east of I-81 in Winchester, Virginia. The residential development in the immediate area consists mostly of single-family homes as well as some small apartment complexes, with 10.8% of the area comprised of manufactured housing. Residences in the area were typically built before 1990, with an average home price of $151,065.
 
The Parkwood Communities property is an age-restricted 55+ manufactured housing community situated on 108.6 acres just east of I-75 in Wildwood, FL. The immediate area primarily consists of detached single-family homes. Residences in the area were typically built before 1990, with an average home price of $72,973.
 
The Cabana property is an age-restricted 55+ manufactured housing community situated on 37.3 acres just east of I-515 in eastern Las Vegas. The immediate area has a considerable amount of single-family residential development consisting largely of detached family homes and mobile homes, driven by the proximity to the Las Vegas Strip, Nellis Air Force Base and the main campus of University of Nevada at Las Vegas. Residences were typically built between the 1970s and 1980s, with an average home price of $91,101.
 
The Boulder Cascade property is an age-restricted 55+ manufactured housing community situated on 39.8 acres just west of I-515 in eastern Las Vegas. The immediate area has a considerable amount of residential development consisting largely of detached single-family homes and mobile homes. Residences were typically built between the 1960s and 1980s, with an average home price of $83,147.
 
The Rancho Valley property is an all-age family manufactured housing community situated on 19.9 acres along I-8 Business in EL Cajon, CA, approximately 15 miles from San Diego. The immediate area predominantly consists of detached single-family homes and mobile home parks, and is almost completely developed with little available land. Residences in the area were typically built between the 1960s and 1980s, with an average home price of $275,138.
 
The Palm Shadows property is an age restricted 55+ manufactured housing community situated on 33.6 acres just west of I-17 in Glendale, AZ, the 5th most populous city in the state of Arizona. The immediate area is primarily residential with commercial and industrial developments along Grand Avenue, a diagonal thoroughfare that runs through Glendale. Residences in the area were typically built before 1990, with an average home price of $91,790.
 
The Hillcrest property is an all-age family manufactured housing community situated on 19.0 acres just south of the center of Rockland, MA, approximately 20 miles south of the Boston CBD. The immediate area consists primarily of detached single-family homes and multifamily complexes. Residences in the area were typically built in the 1960s and earlier, with an average home price of $245,519.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-63
 
 
MSC 2012-C4
ELS Portfolio
 
The following table sets forth further information regarding the ELS Portfolio Property:
 
Property Summary
  
Property
Location
Title
Vesting
Allocated Loan Amount
% of Allocated
Loan Amount
Appraised
Value
Year Built/
Renovated
Percent
Leased
No. of
Pads
  
Royal Coachman
Nokomis, FL
Fee
$11,898,000
19%
$28,880,000
1970s / NAP
NAP
546
  
Regency Lakes
Winchester, VA
Fee
$9,887,000
16%
$24,000,000
1986 / NAP
88.3%
523
  
Parkwood Communities
Wildwood, FL
Fee
$9,681,000
15%
$23,500,000
1984 / NAP
95.5%
695
  
Cabana
Las Vegas, NV
Fee
$9,063,000
14%
$22,000,000
1980 / NAP
96.6%
263
  
Boulder Cascade
Las Vegas, NV
Fee
$8,165,000
13%
$19,820,000
1971 / NAP
78.6%
299
  
Rancho Valley
El Cajon, CA
Fee
$7,164,000
11%
$17,390,000
1969 / NAP
97.1%
140
  
Palm Shadows
Glendale, AZ
Fee
$5,994,000
9%
$14,550,000
1970 / NAP
92.2%
294
  
Hillcrest
Rockland, MA
Fee
$1,895,000
3%
$4,600,000
1960s / NAP
90.4%
83
  
Total
    
$63,747,000
100%
$154,740,000
  
91.3%
2,843
  
 
The Market. The ELS Portfolio Property consists of 8 separate properties in six states. The Royal Coachman Property is located in Nokomis, FL. The six property sales comps for the Royal Coachman Property achieved sales prices of $29,237 to $71,936, per home site. The Regency Lakes Property is located in Winchester, Virginia. The five property sales comps for the Regency Lakes Property achieved sales prices of $32,500 to $40,274, per home site. The Parkwood Communities Property is located in Wildwood, FL. The five property sales comps for the Parkwood Communities Property achieved sales prices of $54,175 to $79,909, per home site. The Cabana Property is located in Las Vegas, NV. The five property sales comps for the Cabana Property achieved sales prices of $53,333 to $99,119, per home site. The Boulder Cascade Property is located in Las Vegas, NV. The five property sales comps for the Boulder Cascade Property achieved sales prices of $53,333 to $99,119, per home site. The Rancho Valley Property is located in EL Cajon, CA, approximately 15 miles northeast of San Diego. The five property sales comps for the Rancho Valley Property achieved sales prices of $92,857 to $112,851, per home site. The Palm Shadows Property is located in Glendale, AZ. The five property sales comps for the Palm Shadows Property achieved sales prices of $34,826 to $55,200, per home site. The Hillcrest Property is located in Rockland, MA, approximately 20 miles south of the Boston CBD. The five property sales comps for the Hillcrest Property achieved sales prices of $31,031 to $73,169, per home site.
 
Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the ELS Portfolio Property:
 
Cash Flow Analysis
  
   
2009
  
2010
  
2011
  
UW
  
UW per Site
  
Net Rental(1)
  
$10,655,249
  
$11,117,950
  
$11,419,911
  
$11,461,396
  
$4,990
  
Net RV Rental(1)
  
$3,234,425
  
$3,326,004
  
$3,412,302
  
$3,282,615
  
$6,012
  
Other Income(2)
  
$1,252,934
  
$1,229,155
  
$1,378,722
  
$1,441,180
  
$507
  
Less Vacancy & Credit Loss(3)
  
$0
  
$0
  
$0
  
($74,287)
  
($26)
  
Effective Gross Income
  
$15,142,607
  
$15,673,109
  
$16,210,935
  
$16,110,905
  
$5,667
  
Total Expenses
  
$4,748,144
  
$4,668,477
  
$4,841,203
  
$5,623,539
  
$1,978
  
Net Operating Income
  
$10,394,463
  
$11,004,632
  
$11,369,732
  
$10,487,365
  
$3,689
  
TI/LC
  
$0
  
$0
  
$0
  
$0
  
$0
  
Capital Expenditures
  
$576,610
  
$653,919
  
$0
  
$142,150
  
$50
  
Net Cash Flow
  
$9,817,853
  
$10,350,713
  
$11,369,732
  
$10,345,215
  
$3,639
  
Occupancy %
  
90.9%
  
92.4%
  
92.5%
  
90.8%
      
NOI DSCR
  
2.45x
  
2.60x
  
2.68x
  
2.47x
      
NCF DSCR
  
2.32x
  
2.44x
  
2.68x
  
2.44x
      
NOI Debt Yield
  
16.3%
  
17.3%
  
17.8%
  
16.5%
      
NCF Debt Yield
  
15.4%
  
16.2%
  
17.8%
  
16.2%
      
 
(1)
Both Historical and Underwritten Net Rental and Net RV Rental are net of vacancy. Rental income for the seven manufactured housing properties is included in the Net Rental line Item. For the Royal Coachman property, which is a combination modular housing/recreational vehicle property, rental income is included in the Net RV Rental line item. All other line items are on a portfolio total basis.
 
(2)
Other Income is comprised of utility billings, amenity charges and pass-through charges.
 
(3)
An additional vacancy, above the current actual, is applied to three of the properties for underwriting purposes.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-64
 
 
MSC 2012-C4
ELS Portfolio
 
Escrows and Reserves.  The ELS Portfolio Borrower is required to deposit certain on-going reserves during the continuance of a Trigger Period. During the continuance of a Trigger Period, monthly reserves for taxes and insurance in the amount of 1/12 of the annual estimated tax payments and insurance premiums and for capital expenditures in the amount of 1/12 of the product of the total number of pad sites at all the individual ELS Portfolio Properties and $50, will be funded from the Cash Management Account. A “Trigger Period” commences either (a) on the date on which the trailing twelve month NOI (tested as of the end of each calendar quarter) for the ELS Portfolio Property as determined by lender has decreased by 15% or more from $10,512,399 or (b) on the date an event of default occurs, and continues until either the trailing twelve month NOI (tested as of the end of each calendar quarter) for the ELS Portfolio Property as determined by lender is equal to or greater than $10,512,399 for two consecutive calendar quarters or such event of default has been cured or waived in writing.
 
Lockbox and Cash Management. A hard lockbox is in place with respect to the ELS Portfolio Mortgage Loan. The ELS Portfolio Mortgage Loan has in place cash management. Funds in the lockbox account are allocated to debt service payments and, during the continuance of a Trigger Period, required deposits to the reserves as described above under “—Escrows and Reserves” and applied on each monthly payment date to make such payments and deposits. Once the funds in the lockbox account are equal to the amount required to be paid or deposited on the next monthly payment date, the excess is swept daily to an account designated by the ELS Portfolio Borrower (unless the Trigger Period is caused by an event of default in which event the excess is held by the mortgagee as additional security for the ELS Portfolio Mortgage Loan).
 
Property Management. The ELS Portfolio Property is managed by MHC Operating Limited Partnership, an affiliate of the ELS Portfolio Borrower.
 
Mezzanine Loan and Preferred Equity.  Not permitted.
 
Additional Secured Indebtedness (not including trade debts).  Not permitted.
 
Release of Properties.  The ELS Portfolio Borrower may release any of the ELS Portfolio Properties from the lien of the ELS Portfolio Mortgage Loan, subject to the satisfaction of certain requirements and conditions set forth in the loan documents, including, but not limited to, the following: (i) ELS Portfolio Borrower prepays the ELS Portfolio Mortgage Loan in a principal amount equal to either 110% (with respect to the first such release) or 115% (which respect to each release after the first release) of the allocated loan amount for the individual ELS Portfolio Property being released, plus the applicable yield maintenance premium in connection therewith and (ii) after giving effect to the release, the Assumed Debt Service Coverage Ratio is not less than the Assumed Debt Service Coverage Ratio immediately prior to the release. The “Assumed Debt Service Coverage Ratio” equals adjusted net cash flow (defined as underwritten NOI less normalized capital improvements equal to $50 per home site per annum) divided by subsequent twelve month aggregate imputed debt service (excluding reserve funds) assuming the interest rate for the ELS Portfolio Mortgage Loan and a thirty year amortization schedule.
 
The ELS Portfolio Borrower may release any of the ELS Portfolio Properties from the lien of the ELS Portfolio Mortgage Loan after the date that is two years from the securitization closing date and prior to August 1, 2021 through partial or total defeasance, subject to the satisfaction of certain requirements and conditions set forth in the loan documents, including, but not limited to, the following: (i) with respect to any partial defeasance, defeasance of an amount equal to either 110% (with respect to the first such defeasance) or 115% (with respect to each defeasance after the first defeasance) of the allocated loan amount for the individual ELS Portfolio Property being defeased and after giving effect to the defeasance, the Assumed Debt Service Coverage Ratio with respect to the undefeased portion of the ELS Portfolio Mortgage Loan is not less than the Assumed Debt Service Coverage Ratio with respect to the ELS Portfolio Mortgage Loan (or if the ELS Portfolio Mortgage Loan has previously been defeased in part, the undefeased portion of the ELS Portfolio Mortgage Loan) immediately prior to the partial defeasance and (ii) the ELS Portfolio Borrower obtains a rating agency confirmation as to the partial or total defeasance.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-65
 
 
MSC 2012-C4
9 MetroTech Center
 
Mortgage Loan No. 6 – 9 MetroTech Center
 
(PHOTO)
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-66
 
 
MSC 2012-C4
9 MetroTech Center
 
Mortgage Loan No. 6 – 9 MetroTech Center
 
(MAP)
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-67
 
 
MSC 2012-C4
9 MetroTech Center
 
Mortgage Loan No. 6 – 9 MetroTech Center
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
9 MetroTech Center
Brooklyn, NY 11201
Original Balance:
$63,000,000
General Property Type:
Office
Cut-off Date Balance:
$62,896,233
  
Detailed Property Type:
Urban
% of Initial Pool Balance:
5.7%
  
Net Rentable Area:
316,942 SF
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$198
Borrower Name(s):
FC Flatbush Associates II, LLC
  
Balloon/ARD Balance Per Unit/SF:
$153
Sponsor:
Forest City Enterprises, Inc.
  
Year Built / Year Renovated:
1996 / NAP
Mortgage Rate:
5.810%
  
Title Vesting:
Leasehold
Note Date:
1/24/2012
  
Property Manager:
First New York Partners Management, LLC
First Payment Date:
3/1/2012
    
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
2/1/2022
  
UW Revenues:
$14,027,836
IO Period:
None
  
UW Expenses:
$7,705,887
Original Term to Maturity or ARD:
120 months
  
UW NOI:
$6,321,949
Seasoning:
1 month
  
UW NCF:
$5,373,879
Original Amortization Term:
300 months
  
UW NOI DSCR:
1.32x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.12x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
10.1%
Prepayment Provisions:
YM1 (25); DEF/YM1 (91); O (4)
  
UW NCF Debt Yield:
8.5%
Lockbox/Cash Management:
Hard / In Place
  
UW NCF Debt Yield at Maturity:
11.1%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$7,932,306 (1/31/2012)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$8,697,894 (1/31/2011)
Mezzanine Debt:
None
  
Third Most Recent NOI (As of):
$8,276,813 (1/31/2010)
Reserves
  
Appraised Value:
$113,400,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
12/9/2011
Tax Reserve:
$175,806
$87,903
NAP  
  
Cut-off Date LTV Ratio:
55.5%
Insurance Reserve:
$0
Springing
NAP  
  
LTV Ratio at Maturity/ARD:
42.9%
Replacement Reserve:
$0
$0
NAP  
  
Occupancy Rate:
100.0% (3/1/2012)
TI/LC Reserve(1):
$1,213,811
$76,608
NAP  
  
2nd Most Recent Occupancy:
100.0% (1/31/2011)
Ground Rent Reserve:
$28,160
$0
NAP  
  
3rd Most Recent Occupancy:
100.0% (1/31/2010)
 
(1)
Additionally, at any time during a Cash Management Sweep Period (as defined in the related loan agreement) caused by a “FDNY Lease Trigger”, all excess cash flow will be deposited into the TI/LC account. A FDNY Lease Trigger will happen when the current tenant gives notice that it will not extend its lease, or has not extended it by the date that is 18 months prior to the current lease expiration. If the borrower enters into an extension agreement with the current tenant with a term until at least October 1, 2028, or an acceptable alternative lease or leases are signed resulting in a debt yield of at least 10% for two consecutive calendar quarters, the TI/LC Reserves will be released to the 9 MetroTech Center Borrower.
 
The 9 MetroTech Center Mortgage Loan.
 
The Mortgage Loan. The sixth largest mortgage loan (the “9 MetroTech Center Mortgage Loan”) is a refinance loan evidenced by a note in the original principal amount of $63,000,000 and is secured by a first priority leasehold mortgage encumbering the office property known as 9 MetroTech Center in Brooklyn, New York (the “9 MetroTech Center Property”).
 
The 9 MetroTech Center Mortgage Loan had an original term of 120 months and has a remaining term of 119 months. The 9 MetroTech Center Mortgage Loan requires payments of principal and interest for its entire term, with a scheduled maturity of February 1, 2022. Voluntary prepayment of the 9 MetroTech Center Mortgage Loan is permitted in whole on any date together with a yield maintenance premium and, if the prepayment is made other than on the payment date, interest which would have accrued through the next payment date. Defeasance with direct, non-callable obligations of the United States of America (or other non-callable government securities or other non-callable instruments that will not cause the trust to lose its REMIC status and which, in each case, will not result in a downgrade or withdrawal of the ratings for the REMIC securities) is permitted at any time on or after the first due date following the second anniversary of the securitization closing date. The 9 MetroTech Center Mortgage Loan is open to prepayment at par during the final 3 months of the loan term.
 
The Borrower and the Sponsor. The borrower is FC Flatbush Associates II, LLC, a single-purpose Delaware limited liability company with two independent directors (the “9 MetroTech Center Borrower”). The 9 MetroTech Center Mortgage Loan sponsor and nonrecourse carve-out guarantor is Forrest City Enterprises, Inc. (NYSE: FCEA and FCEB). Such non-recourse carve-out guarantee is limited in scope to voluntary and collusive involuntary bankruptcy filings and certain matters pertaining to the ground lease. The total liability under the non-recourse carve-out guarantee is limited to $20,000,000.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-68
 
 
MSC 2012-C4
9 MetroTech Center
 
Forrest City Enterprises, Inc. (“FCE”) is a national real estate company founded in 1920 that, as of October 31, 2011, reported $10.5 billion in total assets. FCE is principally engaged in the ownership, development, management and acquisition of commercial and residential real estate and land throughout the United States. FCE developed the MetroTech Center mixed-use park, including 11 buildings totaling 7.6 million SF between 1990 and 2004.
 
The Mortgaged Property. The 9 MetroTech Center Property is a 9-story, single-tenant office building containing 316,942 SF located in downtown Brooklyn, New York. The 9 MetroTech Center Property, which was constructed for the New York City Fire Department in 1996, and serves as the department’s headquarters and the city emergency command center, is located in the northeast corner of the MetroTech Center office and retail campus. The 9 MetroTech Center Property contains a two-level, below-grade, 137 space parking structure. The city 911 call dispatch center is located across the street from the mortgaged property at 11 MetroTech Center. The entire MetroTech Center was developed by the loan sponsor and is one of seven MetroTech Center buildings currently owned by the sponsor. The City of New York lease commenced in October of 1997 and is currently scheduled to expire in October of 2018. There is one 10-year lease renewal option with an 18-month notice period. The rent during the extension period is based on a fair market value. The current NNN rental rate is $7,923,550 per annum ($25 PSF) and the rent steps to $8,874,376 per annum ($28 PSF) for the last five years of the current lease term. New York City is currently rated Aa2 by Moody’s and AA by S&P. Underwriting is based on $20.78 PSF, which is net of $4.22 in underwritten vacancy and mark to market adjustments.
 
The 9 MetroTech Center Property is subject to an unsubordinated ground lease between the borrower and the City of New York for the subject 1.03 acre parcel. The ground lease commenced in August 1996 and expires in August of 2095. Current ground rent is $112,640, per annum. The ground rent remains at the current level as long as New York City is the building tenant. If the New York City lease should not renew, the ground rent will reset to an amount equal to 10% of the then appraised fair market value of the underlying land, as undeveloped.
 
The Market. Overall Brooklyn office vacancy averaged 9.8% during the third quarter of 2011, while vacancy was concentrated in the Class A space, which had a 16.6% vacancy rate. The subject submarket consists of 13 buildings, nine of which are in the MetroTech Center development and seven of which are owned and managed by affiliates of the 9 MetroTech Center Loan sponsor. The 13 comparable buildings contain approximately 8.4 million square feet of office space and are currently, in total, 11.8% vacant, including sublease availability. Almost half of the vacancy is attributable to sublease space available from JP Morgan Chase in 4 MetroTech Center. This sublease space is currently offered at $34.00 PSF, gross, plus electricity. Offering rents in the submarket range from $19.50 to $35.00 PSF gross, plus electricity.
 
Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the 9 MetroTech Center Property:
 
Cash Flow Analysis(1)
  
   
2009
  
2010
  
2011
  
UW
  
UW PSF
  
Gross Potential Rent
  
$7,923,550
  
$7,923,550
  
$7,923,550
  
$7,923,550
  
$25.00
  
Total Reimbursements
  
$5,553,030
  
$7,164,616
  
$7,017,393
  
$7,443,087
  
$23.48
  
Other Income
  
$376,991
  
$81,164
  
$65,451
  
$0
  
$0
  
Less Vacancy & MTM Loss(2)
  
$0
  
$0
  
$0
  
($1,338,801)
  
($4.22)
  
Effective Gross Income
  
$13,853,571
  
$15,169,330
  
$15,006,394
  
$14,027,836
  
$44.26
  
Total Expenses
  
$5,576,758
  
$6,471,436
  
$7,074,088
  
$7,705,887
  
$24.31
  
Net Operating Income
  
$8,276,813
  
$8,697,894
  
$7,932,306
  
$6,321,949
  
$19.95
  
TI/LC
  
$0
  
$0
  
$0
  
$868,835
  
$2.74
  
Capital Expenditures
  
$0
  
$0
  
$0
  
$79,236
  
$0.25
  
Net Cash Flow
  
$8,276,813
  
$8,697,894
  
$7,932,306
  
$5,373,879
  
$16.96
  
Occupancy %
  
100%
  
100%
  
100%
  
95.0%
      
NOI DSCR
  
1.73x
  
1.82x
  
1.66x
  
1.32x
      
NCF DSCR
  
1.73x
  
1.82x
  
1.66x
  
1.12x
      
NOI Debt Yield
  
13.2%
  
13.8%
  
12.6%
  
10.1%
      
NCF Debt Yield
  
13.2%
  
13.8%
  
12.6%
  
8.5%
      
 
(1)
The property operates on a fiscal year ending on January 31. For example, the 2009 statements reported above are for the period ending January 31, 2010.
 
(2)
Vacancy is underwritten at 5% ($768,332) and an additional “mark to market” adjustment of $570,469 ($1.80 PSF) is applied. The contractual rent is currently $25.00 PSF NNN, stepping to $28.00 PSF NNN in October 2012.
 
Escrows and Reserves.  The 9 MetroTech Center Borrower deposited $175,806 in escrow for annual real estate taxes at loan origination and is required to escrow 1/12 of the annual estimated tax payments monthly. The 9 MetroTech Center Borrower is required to escrow 1/12 of the annual estimated insurance premiums monthly (unless the 9 MetroTech Center Borrower maintains insurance under an acceptable blanket insurance policy). The 9 MetroTech Center Borrower deposited $1,213,811 in escrow for TI/LC reserves at loan origination and is required to escrow monthly $76,608 until the monthly payment date immediately preceding the earlier to occur of
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-69
 
 
MSC 2012-C4
9 MetroTech Center
 
(i) the City of New York exercising its extension option to extend the term of the FDNY lease at the  9 MetroTech Center Property until at least October 1, 2028 and (ii) 9 MetroTech Center Borrower enters into other leases such that the debt yield is at least 10% for two consecutive calendar quarters. Additionally, following a FDNY Lease Trigger, all excess cash flow will be deposited into the TI/LC account. A FDNY Lease Trigger will happen when the current tenant gives notice that it will not extend its lease, or has not extended it by the date that is 18 months prior to the current lease expiration. The 9 MetroTech Center Borrower is required to deposit any fee, payment or other compensation received from any tenant relating to a lease termination into a lease termination reserve to be utilized for TI/LCs incurred with respect to the related space. The 9 MetroTech Center Borrower deposited $28,160 in escrow for ground rent at origination and is required to replenish or increase such escrow in the event that the ground rent funds on deposit are less than three months of ground rent.
 
Lockbox and Cash Management.  A hard lockbox is in place with respect to the 9 MetroTech Center Mortgage Loan. The 9 MetroTech Center Mortgage Loan has in place cash management. Funds in the lockbox account are allocated to debt service payments and required deposits to the reserves as described above under “—Escrows and Reserves” and applied on each monthly payment date to make such payments and deposits. The excess funds in the lockbox account are swept on the twentieth day of each month to an account designated by the 9 MetroTech Center Borrower (unless either (x) so long as no event of default has occurred, the City of New York informs the 9 MetroTech Center Borrower that it will not extend the FDNY lease until at least October 1, 2028 or has not extended the term of such lease as of the date that is 18 months prior to the expiration of the current term under the lease, in which event the 9 MetroTech Center Borrower will be required to deposit all excess funds with respect to the 9 MetroTech Center Mortgage Loan into the TI/LC reserve (until either such tenant renews such lease in accordance with its terms or 9 MetroTech Center Borrower enters into other leases such that the debt yield is at least 10%) or (y) an event of default occurs, in which event the excess is held by the mortgagee as additional security for the 9 MetroTech Center Mortgage Loan).
 
Property Management. The 9 MetroTech Center Property is managed by First New York Partners Management, LLC, an affiliate of the 9 MetroTech Center Mortgage Loan sponsor.
 
Mezzanine Loan and Preferred Equity.  Not permitted.
 
Additional Secured Indebtedness (not including trade debts).  Not permitted.
 
Release of Parcels.  Not permitted.
 
Terrorism Insurance.  The 9 MetroTech Center Borrower is required pursuant to the loan documents to maintain (or cause to be maintained) insurance against loss for acts of terrorism with respect to the 9 MetroTech Center Property; provided that the 9 MetroTech Center Borrower shall not be required to spend more than $150,000 in any calendar year on insurance premiums for terrorism insurance.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-70
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(THIS PAGE INTENTIONALLY LEFT BLANK)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-71
 
 
MSC 2012-C4
GPB Portfolio 2
 
Mortgage Loan No. 7 – GPB Portfolio 2
 
(PHOTO)
                 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-72
 
 
MSC 2012-C4
GPB Portfolio 2
 
Mortgage Loan No. 7 – GPB Portfolio 2
 
(MAP)
 
                       
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-73
 
 
MSC 2012-C4
GPB Portfolio 2
 
Mortgage Loan No. 7 – GPB Portfolio 2
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Portfolio
Credit Assessment (DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Location(2):
Various
Original Balance:
$62,691,000
  
General Property Type:
Retail
Cut-off Date Balance:
$62,428,188
  
Detailed Property Type:
Anchored
% of Initial Pool Balance:
5.7%
  
Net Rentable Area:
702,779 SF
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$89
Borrower Name(s):
New Creek II LLC
  
Balloon/ARD Balance Per Unit/SF:
$70
Sponsor:
Anastasios Parafestas
  
Year Built / Year Renovated:
Various / Various
Mortgage Rate:
5.500%
  
Title Vesting(3):
Fee and Leasehold
Note Date:
12/8/2011
  
Property Manager:
Wilder Companies, Ltd.
First Payment Date:
1/7/2012
      
Anticipated Repayment Date:
NAP
      
Maturity Date:
12/7/2021
  
Underwriting and Financial Information
IO Period:
None
  
UW Revenues:
$10,606,199
Original Term to Maturity or ARD:
120 months
  
UW Expenses:
$3,874,489
Seasoning:
3 months
  
UW NOI:
$6,731,710
Original Amortization Term(1):
313 months
  
UW NCF:
$6,380,654
Loan Amortization Type:
Amortizing
  
UW NOI DSCR:
1.48x
Interest Accrual Basis:
Actual/360
  
UW NCF DSCR:
1.41x
Prepayment Provisions:
LO (27); DEF (86); O (7)
  
UW NOI Debt Yield:
10.8%
Lockbox/Cash Management:
Hard / In Place
  
UW NCF Debt Yield:
10.2%
Pari Passu Mortgage Debt:
None
  
UW NCF Debt Yield at Maturity:
13.0%
Subordinate Mortgage Debt:
None
  
Most Recent NOI (As of):
$6,301,848 (12/31/2011)
Mezzanine Debt:
Permitted
  
Second Most Recent NOI (As of):
$7,473,600 (12/31/2010)
Reserves
  
Third Most Recent NOI (As of):
$6,753,676 (12/31/2009)
Type
Initial
Monthly
Cap  
  
Appraised Value:
$107,950,000
Tax Reserve:
$313,085
$170,481
NAP  
  
Appraisal As-of Date:
4/24/ 2011 - 5/21/2011
Insurance Reserve:
$0
Springing
NAP  
  
Cut-off Date LTV Ratio:
57.8%
Replacement Reserve:
$0
$8,785
$215,530  
  
LTV Ratio at Maturity/ARD:
45.4%
TI/LC Reserve:
$0
$20,498
$502,904  
  
Occupancy Rate:
96.1% (1/31/2012)
Def. Maint. Reserve:
$73,132
$0
NAP  
  
2nd Most Recent Occupancy:
97.0% (12/31/2010)
Ground Rent Reserve:
$12,442
$12,442
NAP  
  
3rd Most Recent Occupancy:
85.6% (12/31/2009)
 
(1)
The Original Amortization Term reflects an effective blended amortization term of approximately 313 months. The loan amount allocated to the GPB Portfolio 2 - Danbury Walmart property, which is secured by a leasehold interest, amortizes on a 180-month schedule, while the remaining loan amount amortizes on a 360-month schedule.
 
(2)
The GPB Portfolio 2 consists of 11 retail properties in three states. See “–The Mortgaged Property” table below.
 
(3)
Ten of the properties are owned by the borrower in fee and one as a leasehold.
 
The GPB Portfolio 2 Mortgage Loan.
 
The Mortgage Loan. The seventh largest loan (the “GPB Portfolio 2 Mortgage Loan”) is a refinance loan evidenced by a single note in the original principal balance of $62,691,000, and is secured by 10 first-priority fee mortgages and one first-priority leasehold mortgage encumbering 11 retail properties in New Jersey, Massachusetts and Connecticut (collectively, the “GPB Portfolio 2 Property”). The GPB Portfolio 2 Mortgage Loan refinanced and paid off portions of three previous loans, each secured, in part, by components of the GPB Portfolio 2 Property, which were included in the MSDWC 2002-TOP7, the MSDWC 2003-HQ2, and the BSCMS 2003-TOP10 CMBS transactions.
 
The GPB Portfolio 2 Mortgage Loan had an initial term of 120 months and has a remaining term of 117 months. GPB Portfolio 2 Mortgage Loan requires payments of principal and interest for its entire term, with a scheduled maturity date of December 7, 2021. Defeasance with direct, non-callable obligations of the United States of America (or other non-callable government securities or other non-callable instruments that will not cause the trust to lose its REMIC status and which, in each case, will not result in a downgrade or
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-74
 
 
MSC 2012-C4
GPB Portfolio 2
  
withdrawal of the ratings for the REMIC securities) is permitted at any time on or after the first due date following the second anniversary of the securitization closing date. The GPB Portfolio 2 Mortgage Loan is open to prepayment at par during the final 6 months of the loan term.
 
The Borrower and Sponsor. The borrower is New Creek II LLC, a single-purpose Delaware limited liability company with at least one independent member (the “GPB Portfolio 2 Borrower”). The GPB Portfolio 2 Borrower is managed and controlled by Anastasios Parafestas. The GPB Portfolio 2 Borrower is related to the GPB Portfolio 1 Borrower. See “Mortgage Loan No. 8 – GPB Portfolio 1”.
 
The GPB Portfolio 2 Mortgage Loan sponsor and non-recourse carve-out guarantor is Anastasios Parafestas. In 1995, Anastasios Parafestas founded and currently operates The Bollard Group LLC, a Boston-based boutique professional services firm that, together with its related organizations, assists entrepreneurs and their families develop their businesses, investing and diversifying their portfolios. Mr. Parafestas and The Bollard Group manage and invest in a real estate portfolio with reported value of more than $575 million, diversified across multiple sectors including office, retail, multi-purpose, land, timber, and hotel properties.
 
The Mortgaged Property. The GPB Portfolio 2 Property consists of 11 retail properties totaling 702,779 SF with one property located in New Jersey, nine properties located in Massachusetts and one property located in Connecticut. As of January 31, 2012, the portfolio was 96.1% leased at an average NNN rent of $11.12 PSF. Anchor tenants comprise approximately 66% of the total net rentable area and 54% of total rent. The largest anchors across the GPB Portfolio 2 Property include Walmart, CVS, Kohl’s, National Wholesale Liquidator and Staples. The top three assets in the GPB Portfolio 2 Property, by allocated loan balance, include the Millburn King’s Super Market Property, where King’s generates sales of $1,073 PSF, the Swampscott CVS Property, where CVS generates sales of $1,519 PSF, and the Salem Staples Property. Staples does not report sales.
 
The Danbury Walmart property is subject to an unsubordinated ground lease with contractual base rent of $60,000 per annum, plus percentage rent, which is subject to CPI-based adjustments every five years. The ground lease currently expires on January 31, 2037, with no extension options.
 
The following table sets forth further information regarding the GPB Portfolio 2 Property:
 
Property Summary
Property
Location
Title Vesting
Allocated
Cut-off Date
Loan
Amount
% of
Allocated
Loan
Amount
Appraised
Value
Year Built/
Renovated
Percent Leased
Net
Rentable
Area
(SF)
Millburn King’s Super
Millburn, NJ
Fee
$9,972,550
16%
$19,400,000
1969 / 2006
87.0%
89,348  
Swampscott CVS
Swampscott, MA
Fee
$9,410,323
15%
$17,600,000
1992 / NAP
90.8%
57,570  
Salem Staples
Salem, MA
Fee
$9,094,320
15%
$15,000,000
1956 / 1992
100.0%
48,425  
Danbury Walmart
Danbury, CT
Leasehold
$8,655,766
14%
$15,900,000
1971, 1975 / NAP
100.0%
136,209  
Woburn Kohl’s
Woburn, MA
Fee
$6,448,663
10%
$11,225,000
1974 / 2002
100.0%
119,378  
Springfield CVS
Springfield, MA
Fee
$5,373,055
9%
$8,170,000
1961 / 2009
100.0%
19,287  
Worcester Savers
Worcester, MA
Fee
$4,216,702
7%
$6,600,000
1960 / NAP
84.1%
66,281  
Dorchester National Wholesale
Dorchester, MA
Fee
$3,231,808
5%
$5,000,000
1965 / NAP
100.0%
84,470  
Framingham AJ Seabra
Framingham, MA
Fee
$2,377,502
4%
$3,510,000
1968 / NAP
100.0%
26,482  
Fall River Staples
Fall River, MA
Fee
$2,236,945
4%
$3,300,000
1970 / 1987
100.0%
30,897  
Chatham Ocean State
Chatham, MA
Fee
$1,410,552
2%
$2,245,000
1970 / 2002
100.0%
24,432  
Total
    
$62,428,188
100%
$107,950,000
  
96.1%
702,779  
 
Major Tenants.
 
Walmart (105,255 SF, 15.0% of NRA, 8.7% of underwritten base rent). Walmart leases (via a sublease from Bradlees Stores, Inc.) 105,255 SF from the GPB Portfolio 2 Borrower, all within the Danbury Walmart Property. The lease began on July 8, 1992 and originally expired on January 31, 1997. The lease has four 10-year lease renewal periods and the current term expires on January 31, 2017, with two 10-year lease renewal options remaining. Wal-Mart Stores, Inc. (NYSE: WMT) operates more than 9,700 retail stores under 69 banners in 28 countries. Total 2011 company sales were $419 billion. Wal-Mart Stores, Inc. is currently rated AA by DBRS, AA by Fitch, AA by S&P and Aa2 by Moody’s. Walmart reported sales of $547 PSF for the most recent reporting period.
 
Kohl’s (104,385 SF, 14.9% of NRA, 8.5% of underwritten base rent). Kohl’s leases 104,385 SF from the GPB Portfolio 2 Borrower, all within the Woburn Kohl’s Property. The lease began on July 8, 1992 and has an expiration date of January 31, 2022, with ten 5-year lease renewal options. Kohl’s Corporation (NYSE: KSS) operates 1,127 stores in 49 states. Total fiscal 2011 company sales were $18.8 billion. Kohl’s Corporation is currently rated BBB+ by Fitch, BBB+ by S&P and Baa1 by Moody’s.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-75
 
 
MSC 2012-C4
GPB Portfolio 2
 
National Wholesale Liquidators (84,470 SF, 12.0% of NRA, 6.2% of underwritten base rent). National Wholesale Liquidators leases 84,470 SF from the GPB Portfolio 2 Borrower, all within the Dorchester National Wholesale Property. The lease began on January 27, 2010 and has an expiration date of January 31, 2021, with three 5-year lease renewal options. National Wholesale Liquidators is a private company.
 
The following table sets forth further information regarding major tenants at the GPB Portfolio 2 Property:
 
 
Tenant Summary
  
 
Tenant Name
Credit Rating (Fitch/Moody’s/S&P)(1)
Tenant
NRSF
% of
NRSF
Annualized
Underwritten
Base Rent ($)
% of Total
Annual Underwritten
Base Rent
Annualized Underwritten Base Rent
($ Per NRSF)
Lease Expiration
Tenant
TTM Sales
PSF
  
 
Tenants
                  
 
Walmart
AA/Aa2/AA
105,255
15%
$656,286
9%
$6.24
1/31/2017
$547
  
 
Kohl’s
BBB+/Baa1/BBB+
104,385
15%
$640,924
9%
$6.14
1/31/2022
NAV
  
 
National Wholesale Liquidator
NR/NR/NR
84,470
12%
$464,585
6%
$5.50
1/31/2021
$177
  
 
Staples
BBB/Baa2/BBB
24,000
3%
$258,000
3%
$10.75
1/31/2014
NAV
  
 
Staples
BBB/Baa2/BBB
20,388
3%
$407,760
5%
$20.00
1/31/2014
NAV
  
 
King’s Super Market
NR/NR/NR
40,024
6%
$149,000
2%
$3.72
4/30/2015
$1,073
  
 
Marshalls
NR/NR/NR
30,954
4%
$301,802
4%
$9.75
1/31/2022
$344
  
 
CVS
BBB+/Baa2/BBB+
19,287
3%
$650,000
9%
$33.70
1/31/2034
$863
  
 
CVS
BBB+/Baa2/BBB+
11,060
2%
$320,740
4%
$29.00
1/31/2019
$1,519
  
 
Subtotal / Wtd. Avg.
  
439,823
63%
$3,849,097
51%
$8.75
      
                     
 
Other Tenants
  
  237,336
34%
    3,683,750
49%
$15.52
Various
    
 
Vacant Space
  
    25,622
4%
$0
0%
$0.00
      
 
Total / Wtd. Avg.
  
  702,781
100%
    $7,532,847
100%
$11.12
      
 
(1)
Certain ratings are those of the parent company whether or not the parent guarantees the lease.
 
The following table presents certain information relating to the lease rollover at the GPB Portfolio 2 Property.
 
 
Lease Rollover Schedule(1)(2)
  
 
Year
# of Leases  
  Rolling  
SF Rolling
Average Underwritten Base Rent PSF
Rolling(3)
Approx.
% of Total
SF Rolling
Approx.
Cumulative %
of SF Rolling
Total
Underwritten
Base Rent
Rolling
Approx.
% of Total
Base Rent
 Rolling
Approx.
Cumulative % of
Total Base Rent  Rolling
  
 
MTM
 0  
0
$0.00
0%
0%
$0
0%
0%
  
 
2012
 1  
1
$1,072.08
0%
0%
$1,072
0%
0%
  
 
2013
 6  
23,667
$13.10
3%
3%
$309,998
4%
4%
  
 
2014
 10  
92,432
$14.81
13%
17%
$1,368,981
18%
22%
  
 
2015
 3  
62,083
$6.55
9%
25%
$406,688
5%
28%
  
 
2016
 5  
13,535
$29.02
2%
27%
$392,748
5%
33%
  
 
2017
 8  
137,759
$9.48
20%
47%
$1,306,137
17%
50%
  
 
2018
 4  
43,226
$12.35
6%
53%
$533,843
7%
57%
  
 
2019
 3  
19,021
$19.92
3%
56%
$378,924
5%
62%
  
 
2020
 4  
18,200
$16.46
3%
58%
$299,605
4%
66%
  
 
2021
 4  
108,409
$7.95
15%
74%
$861,365
11%
78%
  
 
2022 & Beyond
 5  
158,826
$10.54
23%
96%
$1,673,485
22%
100%
  
 
Vacant
 0  
25,622
$0.00
4%
100%
$0
0%
    
 
Total / Wtd. Avg.
 53  
702,781
$11.12
100%
  
$7,532,847
100%
    
 
(1)
The information in the lease rollover schedule is based on the underwritten rent roll.
 
(2)
Certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date of the subject lease and that are not considered in the lease rollover schedule.
 
(3)
Average Underwritten Base Rent PSF Rolling excludes vacant space.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-76
 
 
MSC 2012-C4
GPB Portfolio 2
 
The Market. The GPB Portfolio 2 property consists of 11 properties in three states. Certain market information is contained in the table below.
 
 
Market Summary
  
 
Property
Location
Property
Occupancy
Submarket Occupancy(1)
Market Comp Occupancy
2010 Population
5 Miles(1)
2010 Average Household
Income 5 Miles(1)
  
 
Millburn King’s Super
Millburn, NJ
87.0%
92.3%
97.8%
277,306
$131,011
  
 
Swampscott CVS
Swampscott, MA
90.8%
92.9%
98.0%
215,810
$75,976
  
 
Salem Staples
Salem, MA
100.0%
92.9%
98.3%
221,220
$76,040
  
 
Danbury Walmart
Danbury, CT
100.0%
97.5%
95.9%
110,807
$95,382
  
 
Woburn Kohl’s
Woburn, MA
100.0%
92.9%
94.4%
198,247
$106,772
  
 
Springfield CVS
Springfield, MA
100.0%
95.4%
100.0%
231,008
$57,813
  
 
Worcester Savers
Worcester, MA
84.1%
94.9%
93.7%
200,048
$63,568
  
 
Dorchester National Wholesale
Dorchester, MA
100.0%
96.5%
99.0%
611,885
$79,631
  
 
Framingham AJ Seabra
Framingham, MA
100.0%
96.5%
98.9%
130,710
$102,969
  
 
Fall River Staples
Fall River, MA
100.0%
91.6%
92.8%
123,188
$54,819
  
 
Chatham Ocean State
Chatham, MA
100.0%
89.9%
91.0%
17,917
$73,711
  
 
(1)
 Source: Appraisal
 
Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the GPB Portfolio 2 Property:
 
 
Cash Flow Analysis
  
   
2009
  
2010
  
2011
  
UW
  
UW PSF
  
 
Gross Potential Rent(1)
$7,707,570
  
$7,964,288
  
$7,795,311
  
$8,050,180
  
$11.45
  
 
Total Reimbursements
$2,874,241
  
$3,282,010
  
$2,878,236
  
$2,872,592
  
$4.09
  
 
Other Income
$48,276
  
$21,779
  
$99,967
  
$14,967
  
$0.02
  
 
Less Vacancy & Credit Loss
($34,709)
  
($100,962)
  
($159,147)
  
($331,540)
  
($0.47)
  
 
Effective Gross Income
$10,595,378
  
$11,167,115
  
$10,614,367
  
$10,606,199
  
$15.09
  
 
Total Expenses
$3,841,702
  
$3,693,515
  
$4,312,519(2)
  
$3,874,489
  
$5.51
  
 
Net Operating Income
$6,753,676
  
$7,473,600
  
$6,301,848
  
$6,731,710
  
$9.58
  
 
TI/LC
$466,575
  
$364,970
  
$116,545
  
$175,360
  
$0.25
  
 
Capital Expenditures
$8,215
  
$643,454
  
$148,288
  
$175,695
  
$0.25
  
 
Net Cash Flow
$6,278,886
  
$6,465,176
  
$6,037,015
  
$6,380,654
  
$9.08
  
 
Occupancy %
85.6%
  
97.0%
  
96.1%
  
95.9%
      
 
NOI DSCR
1.49x
  
1.65x
  
1.39x
  
1.48x
      
 
NCF DSCR
1.39x
  
1.43x
  
1.33x
  
1.41x
      
 
NOI Debt Yield
10.8%
  
12.0%
  
10.1%
  
10.8%
      
 
NCF Debt Yield
10.1%
  
10.4%
  
9.7%
  
10.2%
      
 
(1)
Historical and underwritten Gross Potential Rent is net of vacancy. Underwritten Gross Potential Rent includes base rent, percentage rent of $479,927, and $37,407 of straight-line rent credit for the Springfield CVS Property.
 
(2)
2011 expenses were impacted by higher than normal snow removal costs and increased Massachusetts real estate taxes. Snow removal is underwritten as an average of the past four years.
 
Escrows and Reserves.  The GPB Portfolio 2 Borrower deposited $313,085 in escrow for annual real estate taxes at loan origination and is required to escrow 1/12 of the annual estimated tax payments monthly. The GPB Portfolio 2 Borrower is required to escrow 1/12 of the annual estimated insurance premiums monthly (unless the GPB Portfolio 2 Borrower maintains insurance under an acceptable blanket insurance policy). The GPB Portfolio 2 Borrower is also required to make monthly deposits of $8,785 for replacement reserves and $20,498 for TI/LC reserves, provided that such deposits are not required at any time that the amount then on deposit in the replacement reserve exceeds $215,530 or in the TI/LC reserve exceeds $502,904. The GPB Portfolio 2 Borrower deposited $12,442 in escrow for ground rent at loan origination and is required to escrow the monthly ground rent payable under the ground lease at least ten business days before the monthly payment date under the GPB Portfolio 2 Mortgage Loan. The GPB Portfolio 2 Borrower deposited $73,132 in escrow for deferred maintenance at loan origination.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-77
 
 
MSC 2012-C4
GPB Portfolio 2
 
Lockbox and Cash Management. A hard lockbox is in place with respect to the GPB Portfolio 2 Mortgage Loan. The GPB Portfolio 2 Mortgage Loan has in place cash management. Funds in the lockbox account are allocated to debt service payments and required deposits to the reserves as described above under “—Escrows and Reserves” and applied on each monthly payment date to make such payments and deposits. Once the funds in the lockbox account are equal to the amount required to be paid or deposited on the next monthly payment date, the excess is swept daily to an account designated by the GPB Portfolio 2 Borrower, provided that, notwithstanding the foregoing, during the continuance of a Trigger Period all excess cash with respect to the GPB Portfolio 2 Mortgage Loan is held by the mortgagee as additional security for the GPB Portfolio 2 Mortgage Loan. A “Trigger Period” will commence upon the occurrence of an event of default or on the date on which the actual debt service coverage ratio (tested as of the end of each calendar quarter) is less than 1.15x for the immediately preceding twelve month period, and will end on the date when such event of default has been cured or waived in writing or when the actual debt service coverage ratio (tested as of the end of each calendar quarter) is and shall have been for the immediately preceding two consecutive calendar quarters equal to or greater than 1.20x.
 
Property Management. The GPB Portfolio 2 Property is managed by The Wilder Companies, Ltd., a Boston-based national real estate development, management and leasing firm.
 
Mezzanine Loan and Preferred Equity.  Future mezzanine financing is permitted subject to various conditions including: (i) no event of default exists, (ii) the principal amount of the mezzanine loan will not result in an aggregate loan-to-value ratio greater than 70% or an aggregate actual debt service coverage ratio less than 1.10x, (iii) the collateral for the mezzanine loan includes only pledges of direct or indirect equity interests in the GPB Portfolio 2 Borrower and any mezzanine accounts and not any portion of the GPB Portfolio 2 Property, (iv) the mezzanine lender shall be a “permitted mezzanine lender” as defined in the loan documents for the GPB Portfolio 2 Mortgage Loan and enters into an intercreditor agreement reasonably acceptable to the lender under the GPB Portfolio 2 Mortgage Loan, (v) if such loan bears interest at a floating rate, the mezzanine loan borrower is required to maintain during the term thereof an interest rate cap which causes the actual debt service coverage ratio immediately following closing to be not less than 1.10x and (vi) the documentation, legal opinions, organizational documents and structure of the mezzanine loan shall be reasonably acceptable to the lender under the GPB Portfolio 2 Mortgage Loan and consistent with documents customarily delivered in connection with mezzanine loans secured by pledges of equity interests in borrowers obligated under mortgage loans included in a commercial mortgage-backed securitization.
 
Additional Secured Indebtedness (not including trade debts). Not permitted.
 
Release of Properties.  The GPB Portfolio 2 Borrower may release any of the GPB Portfolio 2 Properties from the lien of the GPB Portfolio 2 Mortgage Loan after the date that is two years from the securitization closing date and prior to June 7, 2021 through partial or total defeasance, subject to the satisfaction of certain requirements and conditions set forth in the loan documents, including, but not limited to, with respect to any partial defeasance, (i) delivery of defeasance collateral in an amount equal to 115% of the allocated loan amount for the individual GPB Portfolio 2 Property being defeased, (ii) after giving effect to the partial defeasance, the actual debt service coverage ratio with respect to the undefeased portion of the GPB Portfolio 2 Mortgage Loan is not less than the actual debt service coverage ratio with respect to the GPB Portfolio 2 Mortgage Loan as of loan origination (which the parties agreed was 1.44x) and (iii) with respect to each GPB Portfolio 2 Property that is not nor has been subject to a partial defeasance, the applicable anchor tenants as defined in the loan documents (or any successors under leases approved under the loan documents or as otherwise permitted pursuant to the loan documents) remain in occupancy, paying rent and are not in default at such GPB Portfolio 2 Property.
 
Terrorism Insurance.  Generally, the GPB Portfolio 2 Borrower is required to maintain (or cause to be maintained) insurance against loss for acts of terrorism with respect to the GPB Portfolio 2 Property.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-78
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(THIS PAGE INTENTIONALLY LEFT BLANK)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-79
 
 
MSC 2012-C4
GPB Portfolio 1
 
Mortgage Loan No. 8 – GPB  Portfolio 1
           
(PHOTO)
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-80
 
 
MSC 2012-C4
GPB Portfolio 1
   Mortgage Loan No. 8 – GPB  Portfolio 1
         
(MAP)
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-81
 
 
MSC 2012-C4
 GPB Portfolio 1
 
Mortgage Loan No. 8 – GPB Portfolio 1
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Portfolio
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Location(1):
Various
Original Balance:
$62,309,000
General Property Type:
Retail
Cut-off Date Balance:
$62,113,118
  
Detailed Property Type:
Anchored and Unanchored
% of Initial Pool Balance:
5.7%
  
Net Rentable Area:
516,585 SF
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$120
Borrower Name(s):
New Creek LLC
  
Balloon/ARD Balance Per Unit/SF:
$101
Sponsor:
Anastasios Parafestas
  
Year Built / Year Renovated:
Various / Various
Mortgage Rate:
5.500%
  
Title Vesting:
Fee
Note Date:
12/8/2011
  
Property Manager:
The Wilder Companies, Ltd.
First Payment Date:
1/7/2012
      
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
12/7/2021
  
UW Revenues:
$10,099,876
IO Period:
None
  
UW Expenses:
$2,804,141
Original Term to Maturity or ARD:  
120 months
  
UW NOI:
$7,295,735
Seasoning:
3 months
        
UW NCF:
$7,034,965
Original Amortization Term:
360 months
  
UW NOI DSCR:
1.72x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.66x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
11.7%
Prepayment Provisions:
LO (27); DEF (86); O (7)
  
UW NCF Debt Yield:
11.3%
Lockbox/Cash Management:
Hard / In Place
  
UW NCF Debt Yield at Maturity:
13.5%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$6,800,437 (12/31/2011)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$6,913,743 (12/31/2010)
Mezzanine Debt:
Permitted
  
Third Most Recent NOI (As of):
$6,835,639 (12/31/2009)
Reserves
  
Appraised Value:
$102,671,500
Type
Initial
Monthly
Cap  
 
Appraisal As-of Date:
5/12/2011 - 5/21/ 2011
Tax Reserve:
$195,210
$109,431
NAP  
  
Cut-off Date LTV Ratio:
60.5%
Insurance Reserve:
$0
Springing
NAP  
  
LTV Ratio at Maturity/ARD:
50.8%
Replacement Reserve:
$0
$6,500
$159,470  
  
Occupancy Rate (As of):
98.1% (1/31/2012)
TI/LC Reserve:
$0
$15,166
$372,096  
  
2nd Most Recent Occupancy (As of):  
92.8% (12/31/2010)
Def. Maint. Reserve:
$237,050
$0
NAP  
  
3rd Most Recent Occupancy (As of):
93.9% (12/31/2009)
 
(1)
 The GPB Portfolio 1 consists of 11 retail properties in two states. See “–The Mortgaged Property” table below.
 
The GPB Portfolio 1 Mortgage Loan.
 
The Mortgage Loan. The eighth largest loan (the “GPB Portfolio 1 Mortgage Loan”) is a refinance loan evidenced by a note in the original principal balance of $62,309,000, and is secured by 11 first-priority fee mortgages encumbering 11 retail properties in Massachusetts and New Jersey (collectively, the “GPB Portfolio 1 Property”). The GPB Portfolio 1 Mortgage Loan refinanced and paid off portions of three previous loans, each secured, in part, by components of the GPB Portfolio 1 Property, which were included in the MSDWC 2002-TOP7, the MSDWC 2003-HQ2 and the BSCMS 2003-TOP10 CMBS transactions.
 
The GPB Portfolio 1 Mortgage Loan had an initial term of 120 months and has a remaining term of 117 months. GPB Portfolio 1 Mortgage Loan requires payments of principal and interest for its entire term, with a scheduled maturity date of December 7, 2021. Defeasance with direct, non-callable obligations of the United States of America (or other non-callable government securities or other non-callable instruments that will not cause the trust to lose its REMIC status and which, in each case, will not result in a downgrade or withdrawal of the ratings for the REMIC securities) is permitted at any time on or after the first due date following the second anniversary of the securitization closing date. The GPB Portfolio 1 Mortgage Loan is open to prepayment at par during the final 6 months of the loan term.
 
The Borrower and Sponsor. The borrower is New Creek LLC, a single-purpose Delaware limited liability company with at least one independent member (the “GPB Portfolio 1 Borrower”). The GPB Portfolio 1 Borrower is managed and controlled by Anastasios Parafestas. The GPB Portfolio 1 Borrower is related to the GPB Portfolio 2 Borrower. See “Mortgage Loan No. 7 – GPB Portfolio 2”.
 
The GPB Portfolio 1 Mortgage Loan sponsor and non-recourse carve-out guarantor is Anastasios Parafestas. In 1995, Anastasios Parafestas founded and currently operates The Bollard Group LLC, a Boston-based boutique professional services firm that, together
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-82
 
 
MSC 2012-C4
 GPB Portfolio 1
 
with its related organizations, assists entrepreneurs and their families develop their businesses, investing and diversifying their portfolios. Mr. Parafestas and The Bollard Group manage and invest in a real estate portfolio with reported value of more than $575 million, diversified across multiple sectors including office, retail, multi-purpose, land, timber, and hotel properties.
 
The Mortgaged Property. The GPB Portfolio 1 Property consists of 11 retail properties totaling 516,585 SF with ten properties located in Massachusetts and one property located in New Jersey. As of January 31, 2012, the portfolio was 98.1% leased at an average NNN rent of $14.57 PSF. The top three assets in the GPB Portfolio 1 Property by allocated loan balance include the Cambridge Trader Joe’s Property, where Trader Joe’s generates sales of $3,979 PSF, the Falmouth Staples Property (Staples does not report sales), and the Hillsdale King’s Super Market Property, where King’s Super Market generates sales of $597 PSF. Other notable tenants include the Whole Foods located in Brighton, which generates $1,867 PSF in sales, and the Cambridge Micro Center Sales, which generates $1,232 PSF in sales.
 
The following table sets forth further information regarding the GPB Portfolio 1 Property:
 
Property Summary
Property
Location
Allocated Cut-
off Date Loan Amount
Title
Vesting
% of Allocated
Loan Amount
Appraised
Value
Year Built/
Renovated
Percent
Leased
Net  
Rentable    Area (SF)  
Cambridge Trader Joe’s
Cambridge, MA
$16,303,585
Fee
26%
$28,000,000
1948, 1995
100.0%
62,555  
Falmouth Staples
Falmouth, MA
$7,943,948
Fee
13%
$11,786,500
1956 / 2006
92.0%
85,524  
Hillsdale King’s Super
Hillsdale, NJ
$6,739,745
Fee
11%
$12,000,000
1970 / NAP
100.0%
60,428  
Medford Aldi
Medford, MA
$6,019,018
Fee
10%
$11,000,000
1965 / NAP
100.0%
56,215  
Brighton Whole Foods
Brighton, MA
$5,912,355
Fee
10%
$9,800,000
1965, 1975 / 2003
100.0%
27,550  
Everett Walgreens
Everett, MA
$5,645,197
Fee
9%
$8,800,000
1957 / NAP
100.0%
41,278  
Abington Lowe’s
Abington, MA
$4,386,168
Fee
7%
$6,830,000
2008 / NAP
100.0%
102,000  
Waltham CVS / Petco
Waltham, MA
$3,525,881
Fee
6%
$5,750,000
1957 / NAP
100.0%
24,284  
Revere Walgreens
Revere, MA
$2,869,949
Fee
5%
$4,400,000
2008 / NAP
100.0%
15,272  
Quincy Walgreens
Quincy, MA
$1,870,102
Fee
3%
$2,880,000
1945 / 1991
89.3%
25,495  
Wakefield Mike’s Gym
Wakefield, MA
$897,171
Fee
1%
$1,425,000
1939 / NAP
100.0%
15,984  
Total
  
$62,113,118
  
100%
$102,671,500
  
98.1%
516,585  
 
Major Tenants.
 
Lowe’s (102,000 SF, 19.7% of NRA, 6.9% of underwritten base rent). Lowe’s leases 102,000 SF from the GPB Portfolio 1 Borrower, all within the Abington Lowe’s Property. The lease began on January 16, 2009 and expires on January 15, 2029, with six 5-year lease renewal options. Lowe’s Companies, Inc. (NYSE: LOW) operates 1,745 stores in the United States, Canada and Mexico. Total fiscal year 2011 company sales were $50.2 billion. Lowes Companies, Inc. is currently rated A3 by Moody’s and A- S&P.
 
Walgreens (57,853 SF, 11.2% of NRA, 13.2% of underwritten base rent). Walgreens leases 57,853 SF from the GPB Portfolio 1 Borrower over four different GPB Portfolio 1 Property locations. Two leases began in 1986, one lease began in 1992 and the forth lease began in 1995 and expire in 2021, 2027, 2022, and 2035, respectively. Two leases have remaining lease renewal options and two do not. Walgreens Co. (NYSE, NASDAQ: WAG) operates 7,761 stores. Total fiscal year 2011 company sales were $72.2 billion. Walgreens Co. is currently rated A by S&P and A2 by Moody’s. The four Walgreens stores reported sales of between $282 and $771 PSF.
 
Micro Center Sales (41,724 SF, 8.1% of NRA, 11.3% of underwritten base rent). Micro Center Sales leases 41,724 SF from the GPB Portfolio 1 Borrower, all within the Cambridge Trader Joe’s Property. The lease began on October 1, 1995 and originally expired on September 30, 2010. The tenant has exercised its two 5-year lease renewal options until September 30, 2020.  Micro Center Computer & Electronics is a 23-store computer supply chain. The company is private. Micro Center reported sales of $1,232 PSF.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-83
 
 
MSC 2012-C4
 GPB Portfolio 1
  
The following table sets forth further information regarding major tenants at the GPB Portfolio 1 Property:
 
Tenant Summary
Tenant Name
Credit Rating (Fitch/Moody’s/S&P)(1)
Tenant
NRSF
% of
NRSF
Annualized Underwritten
Base Rent ($)
% of Total
Annual Underwritten
Base Rent
Annualized Underwritten Base Rent ($
Per NRSF)
Lease Expiration
Tenant TTM    Sales PSF  
Tenants
                
Lowe’s
NR/A3/A-
102,000
20%
$510,000
7%
$5.00
1/15/2029
NAV  
Walgreens
NR/A2/A
16,332
3%
$242,367
3%
$14.84
6/30/2021
$740  
Walgreens
NR/A2/A
15,272
3%
$324,988
4%
$21.28
11/30/2027
$283  
Walgreens
NR/A2/A
14,707
3%
$275,462
4%
$18.73
6/30/2035
$394  
Walgreens
NR/A2/A
11,542
2%
$129,270
2%
$11.20
10/31/2022
$771  
Micro Center Sales
NR/NR/NR
41,724
8%
$834,480
11%
$20.00
9/30/2020
$1,232  
King’s Super Market
NR/NR/NR
30,811
6%
$72,027
1%
$2.34
6/30/2017
$597  
Petco
NR/Caa1/B
13,650
3%
$204,750
3%
$15.00
5/31/2014
$236  
Petco
NR/Caa1/B
11,156
2%
$148,152
2%
$13.28
1/31/2017
NAV  
Staples
BBB/Baa2/BBB
24,652
5%
$278,765
4%
$11.31
6/30/2014
NAV  
Off Broadway Shoes
NR/NR/NR
22,478
4%
$442,817
6%
$19.70
8/31/2017
$97  
Subtotal / Wtd. Avg.
  
304,324
59%
$3,463,078
47%
$11.38
    
                 
Other Tenants
  
202,640
39%
$3,924,125
53%
$19.37
Various
  
Vacant Space
  
       9,621
2%
$0
0%
$0.00
    
Total / Wtd. Avg.
  
  516,585
100%
$7,387,203
100%
$14.57
    
 
(1)
Certain ratings are those of the parent company whether or not the parent guarantees the lease.
 
The following table presents certain information relating to the lease rollover at the GPB Portfolio 1 Property:
 
Lease Rollover Schedule(1)(2)
Year
# of Leases Rolling
SF Rolling
Average Underwritten Base Rent PSF
Rolling(3)
Approx.
% of Total
SF Rolling
Approx.
Cumulative %
of SF Rolling
Total
Underwritten
Base Rent
Rolling
Approx.
% of Total
Base Rent
 Rolling
Approx. 
Cumulative % of 
Total Base Rent 
Rolling 
MTM
4
17,974
$11.21
3%
3%
$201,550
3%
3% 
2012
0
0
$0.00
0%
3%
$0
0%
3% 
2013
6
26,434
$18.78
5%
9%
$496,347
7%
9% 
2014
6
59,868
$13.00
12%
20%
$778,383
11%
20% 
2015
4
22,567
$17.59
4%
25%
$396,857
5%
25% 
2016
4
16,040
$21.62
3%
28%
$346,825
5%
30% 
2017
5
73,120
$12.74
14%
42%
$931,690
13%
43% 
2018
2
4,400
$38.86
1%
43%
$170,985
2%
45% 
2019
4
21,666
$14.58
4%
47%
$315,995
4%
49% 
2020
3
47,047
$19.97
9%
56%
$939,604
13%
62% 
2021
5
46,777
$16.17
9%
65%
$756,570
10%
72% 
2022 & Beyond
6
171,071
$12.00
33%
98%
$2,052,397
28%
100% 
Vacant
0
9,621
$0.00
2%
100%
$0
0%
  
Total / Wtd. Avg.
49
516,585
$14.57
100.0%
  
$7,387,203
100%
  
 
(1)
The information in the lease rollover schedule is based on the underwritten rent roll.
 
(2)
Certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date of the subject lease and that are not considered in the lease rollover schedule.
 
(3)
Average Underwritten Base Rent PSF Rolling excludes vacant space.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-84
 
 
MSC 2012-C4
 GPB Portfolio 1
 
The Market. The GPB Portfolio 1 property consists of 11 properties in two states. Certain market information is contained in the table below:
 
Market Summary
Property
Location
Property Occupancy
Submarket Occupancy(1)
Market Comp Occupancy(1)
2010 Population
5 Miles(1)
2010 Average 
Household Income 
5 Miles(1)  
Cambridge Trader Joe’s
Cambridge, MA
100.0%
96.5%
95.0%
928,401
$85,325 
Falmouth Staples
Falmouth, MA
92.0%
89.9%
96.1%
28,464
$78,765 
Hillsdale King’s Super
Hillsdale, NJ
100.0%
97.9%
95.8%
219,672
$139,521 
Medford Aldi
Medford, MA
100.0%
96.5%
97.0%
783,092
$84,261 
Brighton Whole Foods
Brighton, MA
100.0%
96.5%
96.0%
870,686
$89,868 
Everett Walgreens
Everett, MA
100.0%
96.5%
96.0%
636,264
$81,105 
Abington Lowe’s
Abington, MA
100.0%
89.9%
100.0%
161,616
$75,487 
Waltham CVS / Petco
Waltham, MA
100.0%
96.5%
100.0%
348,814
$111,400 
Revere Walgreens
Revere, MA
100.0%
96.5%
100.0%
479,538
$73,160 
Quincy Walgreens
Quincy, MA
89.3%
89.9%
96.0%
356,475
$74,172 
Wakefield Mike’s Gym
Wakefield, MA
100.0%
92.9%
85.6%
231,314
$95,231 
 
(1)
Source: Appraisal
 
Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the GPB Portfolio 1 Property:
 
Cash Flow Analysis
  
 
2009
  
2010
  
2011
  
UW
  
UW PSF
  
Gross Potential Rent(1)
$7,372,698
  
$7,281,619
  
$7,540,240
  
$8,013,317
  
$15.51
  
Total Reimbursements
$2,176,905
  
$2,150,994
  
$2,326,658
  
$2,435,442
  
$4.71
  
Other Income
($18,922)
  
($19,468)
  
($9,220)
  
$0
  
$0.00
  
Less Vacancy & Credit Loss
($28,941)
  
$0
  
($134,841)
  
($348,883)
  
($0.68)
  
Effective Gross Income
$9,501,740
  
$9,413,145
  
$9,722,837
  
$10,099,876
  
$19.55
  
Total Expenses
$2,666,101
  
$2,499,402
  
$2,922,400
 (2)
$2,804,141
  
$5.43
  
Net Operating Income
$6,835,639
  
$6,913,743
  
$6,800,437
  
$7,295,735
  
$14.12
  
TI/LC
$475,500
  
$148,269
  
$412,427
  
$131,624
  
$0.25
  
Capital Expenditures
$51,845
  
$259,287
  
$356,300
  
$129,146
  
$0.25
  
Net Cash Flow
$6,308,294
  
$6,506,187
  
$6,031,710
  
$7,034,965
  
$13.62
  
Occupancy %
93.9%
  
92.8%
  
98.1%
  
95.6%
      
NOI DSCR
1.61x
  
1.63x
  
1.60x
  
1.72x
      
NCF DSCR
1.49x
  
1.53x
  
1.42x
  
1.66x
      
NOI Debt Yield
11.0%
  
11.1%
  
10.9%
  
11.7%
      
NCF Debt Yield
10.2%
  
10.5%
  
9.7%
  
11.3%
      
 
(1)
Historical and underwritten Gross Potential Rent is net of vacancy. Underwritten Gross Potential Rent includes base rent, and $594,158 of percentage rent. In addition, $246,349 in rent steps are underwritten. $152,625 of the underwritten rent steps relate to the Brighton Whole Foods Property, where the Whole Foods tenant has a rent step to $27.68 PSF on July 1, 2016. Also, the Medford Property gained a new Aldi Supermarket lease in June, 2011.
 
(2)
2011 expenses were impacted by higher than normal snow removal costs and increased Massachusetts real estate taxes. Snow removal is underwritten as an average of the past four years.
 
Escrows and Reserves.  The GPB Portfolio 1 Borrower deposited $195,210 in escrow for annual real estate taxes at loan origination and is required to escrow 1/12 of the annual estimated tax payments monthly. The GPB Portfolio 1 Borrower is required to escrow 1/12 of the annual estimated insurance premiums monthly (unless the GPB Portfolio 1 Borrower maintains insurance under an acceptable blanket insurance policy). The GPB Portfolio 1 Borrower is also required to make monthly deposits of $6,500 for replacement reserves and $15,166 for TI/LC reserves, provided that such deposits are not required at any time that the amount then on deposit in the replacement reserve exceeds $159,470 or in the TI/LC reserve exceeds $372,096. The GPB Portfolio 1 Borrower deposited $237,050 in escrow for deferred maintenance at loan origination.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-85
 
 
MSC 2012-C4
 GPB Portfolio 1
 
Lockbox and Cash Management. A hard lockbox is in place with respect to the GPB Portfolio 1 Mortgage Loan. The GPB Portfolio 1 Mortgage Loan has in place cash management. Funds in the lockbox account are allocated to debt service payments and required deposits to the reserves as described above under “—Escrows and Reserves” and applied on each monthly payment date to make such payments and deposits. Once the funds in the lockbox account are equal to the amount required to be paid or deposited on the next monthly payment date, the excess is swept daily to an account designated by the GPB Portfolio 1 Borrower, provided that, notwithstanding the foregoing, during the continuance of a Trigger Period all excess cash with respect to the GPB Portfolio 1 Mortgage Loan is held by the mortgagee as additional security for the GPB Portfolio 1 Mortgage Loan during a Trigger Period. A “Trigger Period” will commence upon the occurrence of an event of default or on the date on which the actual debt service coverage ratio (tested as of the end of each calendar quarter) is less than 1.15x for the immediately preceding twelve month period, and will end on the date when such event of default has been cured or waived in writing or when the actual debt service coverage ratio (tested as of the end of each calendar quarter) is and shall have been for the immediately preceding two consecutive calendar quarters equal to or greater than 1.20x.
 
Property Management. The GPB Portfolio 1 Property is managed by The Wilder Companies, Ltd., a Boston-based national real estate development, management and leasing firm.
 
Mezzanine Loan and Preferred Equity.  Future mezzanine financing is permitted subject to various conditions including, but not limited to: (i) no event of default exists, (ii) the principal amount of the mezzanine loan will not result in an aggregate loan-to-value ratio greater than 70% or an aggregate actual debt service coverage ratio less than 1.10x, (iii) the collateral for the mezzanine loan includes only pledges of direct or indirect equity interests in the GPB Portfolio 1 Borrower and any mezzanine accounts and not any portion of the GPB Portfolio 1 Property, (iv) the mezzanine lender shall be a “permitted mezzanine lender” as defined in the loan documents for the GPB Portfolio 1 Mortgage Loan and enters into an intercreditor agreement reasonably acceptable to the lender under the GPB Portfolio 1 Mortgage Loan, (v) if such loan bears interest at a floating rate, the mezzanine loan borrower is required to maintain during the term thereof an interest rate cap which causes the actual debt service coverage ratio immediately following closing to be not less than 1.10x and (vi) the documentation, legal opinions, organizational documents and structure of the mezzanine loan shall be reasonably acceptable to the lender under the GPB Portfolio 1 Mortgage Loan and consistent with documents customarily delivered in connection with mezzanine loans secured by pledges of equity interests in borrowers obligated under mortgage loans included in a commercial mortgage-backed securitization.
 
Additional Secured Indebtedness (not including trade debts). Not permitted.
 
Release of Properties.  The GPB Portfolio 1 Borrower may release any of the GPB Portfolio 1 Properties from the lien of the GPB Portfolio 1 Mortgage Loan after two years from the securitization closing date and prior to June 7, 2021 through partial or total defeasance, subject to the satisfaction of certain requirements and conditions set forth in the loan documents, including, but not limited to, with respect to any partial defeasance: (i) delivery of defeasance collateral in an amount equal to 115% of the allocated loan amount for the individual GPB Portfolio 1 Property being defeased, (ii) after giving effect to the partial defeasance, the actual debt service coverage ratio with respect to the undefeased portion of the GPB Portfolio 1 Mortgage Loan is not less than the actual debt service coverage ratio with respect to the GPB Portfolio 1 Mortgage Loan as of loan origination (which the parties agreed was 1.63x) and (iii) with respect to each GPB Portfolio 1 Property that is not nor has been subject to a partial defeasance, the applicable anchor tenants as defined in the loan documents (or any successors under leases approved under the loan documents or as otherwise permitted pursuant to the loan documents) remain in occupancy, paying rent and not in default at such GPB Portfolio 1 Property.
 
Terrorism Insurance.  Generally, the GPB Portfolio 1 Borrower is required to maintain (or cause to be maintained) insurance against loss for acts of terrorism with respect to the GPB Portfolio 1 Property.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-86
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 (THIS PAGE INTENIONALLY LEFT BLANK)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-87
 
 
MSC 2012-C4
 Midtown Square Shopping Center
 
Mortgage Loan No. 9 – Midtown Square Shopping Center
 
(PHOTO)
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-88
 
 
MSC 2012-C4
 Midtown Square Shopping Center
 
Mortgage Loan No. 9 – Midtown Square Shopping Center
 
 
 
 
(MAP)
 
 
 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-89
 
 
MSC 2012-C4
 Midtown Square Shopping Center
 
Mortgage Loan No. 9 – Midtown Square Shopping Center
 
 
 
 
(PHOTO)
 
 
 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-90
 
 
MSC 2012-C4
 Midtown Square Shopping Center
 
Mortgage Loan No. 9 – Midtown Square Shopping Center
 
(MAP)
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-91
 
 
MSC 2012-C4  Midtown Square Shopping Center
                
Mortgage Loan No. 9 – Midtown Square Shopping Center
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment (DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
1221 Coolidge Hwy
Troy, MI 48084
Original Balance:
$35,000,000
  
General Property Type:
Retail
Cut-off Date Balance:
$34,956,343
  
Detailed Property Type:
Anchored
% of Initial Pool Balance:
3.2%
  
Net Rentable Area:
193,301 SF
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$181
Borrower Name(s):
Grand/Sakwa New Holland
Shopping Center, L.L.C.
  
Balloon/ARD Balance Per Unit/SF:
 
$152
 
Sponsor:
Grand-Sakwa Properties
  
Year Built / Year Renovated:
2001 / NAP
Mortgage Rate:
5.500%
  
Title Vesting:
Fee
Note Date:
1/20/2012
  
Property Manager:
Grand/Sakwa Management LLC
First Payment Date:
3/10/2012
      
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
2/10/2022
  
UW Revenues:
$4,926,846
IO Period:
None
  
UW Expenses:
$1,437,174
Original Term to Maturity or ARD:
120 months
  
UW NOI:
$3,489,673
Seasoning:
1 month
  
UW NCF:
$3,288,913
Original Amortization Term:
360 months
  
UW NOI DSCR:
1.46x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.38x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
10.0%
Prepayment Provisions:
LO (25); DEF (88), O (7)
  
UW NCF Debt Yield:
9.4%
Lockbox/Cash Management:
Hard / Springing
  
UW NCF Debt Yield at Maturity:
11.2%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$3,756,573 (12/31/2011)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$3,854,864 (12/31/2010)
Mezzanine Debt:
None
  
Third Most Recent NOI (As of):
$3,778,753 (12/31/2009)
Reserves
  
Appraised Value:
$47,500,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
12/18/2011
Tax Reserve:
$104,737
$13,244
NAP  
  
Cut-off Date LTV Ratio:
73.6%
Insurance Reserve:
$0
Springing
NAP  
  
LTV Ratio at Maturity/ARD:
61.7%
Replacement Reserve:
$0
$3,061
$58,000  
  
Occupancy Rate:
100.0% (1/3/2012)
TI/LC Reserve:
$0
$12,100
$750,000  
  
2nd Most Recent Occupancy:
100.0% (12/8/2011)
         
3rd Most Recent Occupancy:
100.0% (12/20/2010)
 
The Midtown Square Shopping Center Mortgage Loan.
 
The Mortgage Loan. The ninth largest loan (the “Midtown Square Shopping Center Mortgage Loan”) is a refinance loan evidenced by a note in the original principal amount of $35,000,000, and is secured by a first priority fee mortgage encumbering the retail property  known as Midtown Square Shopping Center in Troy, Michigan (the “Midtown Square Shopping Center Property”). The Midtown Square Shopping Center Mortgage Loan refinanced and paid off the previous loan secured by the Midtown Square Shopping Center Property, which was included in the MSDWC 2002-TOP7 CMBS transaction.
 
The Midtown Square Shopping Center Mortgage Loan had an initial term of 120 months and has a remaining term of 119 months. The Midtown Square Shopping Center Mortgage Loan requires payments of principal and interest for its entire term, with a scheduled maturity date of February 10, 2022. Defeasance with direct, non-callable obligations of the United States of America (or other non-callable government securities or other non-callable instruments that will not cause the trust to lose its REMIC status and which, in each case, will not result in a downgrade or withdrawal of the ratings for the REMIC securities) is permitted at any time on or after the first due date following the second anniversary of the securitization closing date. The Midtown Square Shopping Center Mortgage Loan is open to prepayment at par during the final 6 months of the loan term.
 
The Borrower and Sponsor.  The borrower is Grand/Sakwa New Holland Shopping Center, L.L.C., a Delaware limited liability company with one independent director (the “Midtown Square Shopping Center Borrower”). The Midtown Square Shopping Center Mortgage Loan sponsor is Grand/Sakwa Properties, LLC (“Grand/Sakwa Properties”) and the nonrecourse carve-out guarantor is Stephen Grand.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
   
 
T-92
 
 
MSC 2012-C4  Midtown Square Shopping Center
 
Grand/Sakwa Properties was founded in 1989 by Stephen M. Grand and Gary Sakwa, and is based in Farmington Hills, Michigan. The company owns and/or manages 25 properties in four states, most of which are located in Michigan. Grand/Sakwa Management LLC, a sponsor affiliate, provides asset and property management services for over six million square feet of retail, office, and mixed-use properties, including those developed and/or acquired by Grand/Sakwa Properties, as well as on behalf of third-party owners.
 
The Mortgaged Property. The Midtown Square Shopping Center Property was constructed in 2001 and leased in 2001-2002. The property is anchored by a Kroger grocery store. Shadow anchors, which are not collateral for the Midtown Square Shopping Center Mortgage Loan, but which are owned by affiliates of the Midtown Square Shopping Center Borrower and are a part of the shopping center, include Kohl’s, Home Depot, and Target. Other major tenants at the Midtown Square Shopping Center Property include Dunham’s Sports, Michaels, Old Navy and Petco. The anchor and major tenants have all been at the property since the 2001-2002 opening. The Kroger anchor store was originally a Farmer Jack.
 
The Midtown Square Shopping Center Property is part of a larger development that includes the shadow anchors listed above and 285 townhome condominium units, which were sold between 2002 and 2005. Between 1949 and 1999, a portion of the Midtown Square Shopping Center Property site was utilized as the Ford New Holland Tractor Plant, which operated as a research and development facility. All areas of the Midtown Square Shopping Center Property and the associated off-site portions have been remediated to meet applicable “Part 201 Cleanup Criteria”. On April 28, 2010, the responsible party, CNH America, LLC, executed a Limited Commercial Remedial Action Agreement with the Michigan Department of Natural Resources and Environment, achieving “Case Closure” status. An Operations and Maintenance Plan was prepared for CNH America, LLC, to effectively maintain the engineering controls installed at the Midtown Square Shopping Center Property and other portions of the former New Holland facility.
 
Anchor and Major Tenants.
 
Kroger (58,505 SF, 30.3% of NRA, 27.3% of underwritten base rent). The Kroger Co. of Michigan leases 58,505 SF of space from the Midtown Square Shopping Center Borrower. The lease began on September 12, 2001 and the original tenant was Borman’s Inc., which did business at the Midtown Square Shopping Center Property as “Farmer Jack”. The current term expires on September 30, 2021 and the lease has one, ten-year and four, five-year lease extension options. On June 28, 2007, the lease was assigned to and assumed by Kroger. The Kroger Co. (NYSE: KR) operates 2,439 supermarkets and multi-department stores in 31 states under two dozen local banner names. The company also operates 796 convenience stores, 363 jewelry stores, 1,067 supermarket fuel centers and 40 food processing plants in the U.S. The company reported 2010 sales of $82.0 billion and net earnings of $1.1 billion. Kroger is currently rated BBB by Fitch, Baa2 by Moody’s, and BBB by S&P. The tenant does not report sales at this location.
 
Dunham’s Sports (24,026 SF, 12.4% of NRA, 10.6% of underwritten base rent). Dunham’s Athleisure Corporation leases 24,026 SF of space from the Midtown Square Shopping Center Borrower. The lease began on June 8, 2001. The current term expires on January 31, 2017 and the lease has two, five-year lease extension options. Dunham’s Athleisure Corporation is a private company that operates approximately 160 sporting goods stores in 12 states. The company was founded in Waterford, MI in 1937. Dunham’s reported sales of $132 PSF for the trailing-twelve month period ending November 1, 2011.
 
Michaels (23,975 SF, 12.4% of NRA, 10.6% of underwritten base rent). Michaels Stores, Inc. leases 23,975 SF of space from the Midtown Square Shopping Center Borrower. The lease began on February 3, 2002. The current term expires on February 28, 2017 and the lease has two, five-year lease extension options. Michaels Stores, Inc., together with its subsidiaries, is the largest arts and crafts specialty retailer in North America. The company was founded in 1983 and, as of November 16, 2011, operated 1,064 retail stores in 49 states and Canada, and 135 Aaron Brothers stores in nine states. As of March 21, 2011, approximately 93% of the company’s outstanding common stock was owned by an entity controlled by Bain Capital Partners, LLC and The Blackstone Group. The company’s common stock is no longer publicly traded. The company reported 2010 sales of $4.031 billion and gross profit of $1.564 billion. The tenant does not report sales at this location.
 
Old Navy (21,744 SF, 11.2% of NRA, 10.6% of underwritten base rent). Old Navy leases 21,744 SF of space from the Midtown Square Shopping Center Borrower. The lease began on September 18, 2001. The original term expired on September 30, 2006 and the tenant exercised an option to extend the lease term for five years until September 30, 2011. The tenant then exercised a second five-year lease extension option to September 30, 2016. The lease has one additional five-year extension option remaining. Old Navy is a subsidiary of Gap Inc. (NYSE: GPS) and, as of the January 28, 2012, the end of its 2011 fiscal year, operated 1,016 Old Navy clothing stores in North America. Gap Inc. reported 2011 net sales of $14.5 billion and net income of $833 million. Gap Inc., is currently rated BBB- by Fitch, Baa3 by Moody’s and BB+ by S&P. Old Navy reported sales of $265 PSF for the trailing-twelve month period ending November 1, 2011.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
    
 
T-93
 
 
MSC 2012-C4  Midtown Square Shopping Center
 
The following table sets forth further information regarding tenants at the Midtown Square Shopping Center Property:
 
Tenant Summary
 
Tenant Name
Credit Rating
(Fitch/Moody’s/S&P)(1)
Tenant NRSF
% of NRSF
Annualized Underwritten Base Rent ($)
% of Total Annual
   Underwritten
Base Rent
Annualized Underwritten Base Rent ($ Per NRSF)
Lease Expiration
TTM October 2011 Sales PSF
Tenants
                
Kroger
BBB/Baa2/BBB
58,505
30%
$1,050,000
27%
$17.95
9/30/2021
NAV  
Dunham’s Sports
NR/NR/NR
24.026
12%
$408,442
11%
$17.00
1/31/2017
$132  
Michaels
NR/NR/NR
23,975
12%
$407,575
11%
$17.00
2/28/2017
NAV  
Old Navy
BBB-/Baa3/BB+
21,744
11%
$407,684
11%
$18.75
9/30/2016
$265  
Petco
NR/Caa1/B
15,619
8%
$281,142
7%
$18.00
1/31/2017
NAV  
Subtotal / Wtd. Avg.
143,869
74%
$2,554,843
66%
$17.76
    
                 
Other Tenants
  
49,432
26%
    $1,296,124
34%
$26.22
Various
  
Vacant Space
  
0
0%
$0
0%
$0.00
    
Total / Wtd. Avg.
  
  193,301
100%
    $3,850,967
100%
$19.92
    
    
(1) 
Certain ratings are those of the parent company whether or not the parent company guarantees the lease.
 
The following table presents certain information relating to the lease rollover at the Midtown Square Shopping Center Property:
 
Lease Rollover Schedule(1)(2)
Year
# of Leases Rolling
SF Rolling
Average Underwritten Base Rent PSF
Rolling(3)
Approx.
% of Total
SF Rolling
Approx.
Cumulative %
of SF Rolling
Total
Underwritten
Base Rent
Rolling
Approx.
% of Total
Base Rent
 Rolling
Approx. 
Cumulative % of 
Total Base Rent 
Rolling 
MTM
0
0
$0.00
0%
0%
$0
0%
0% 
2012
2
13,261
$28.27
7%
7%
$374,863
10%
10% 
2013
1
3,496
$30.00
2%
9%
$104,880
3%
12% 
2014
2
5,223
$28.61
3%
11%
$149,432
4%
16% 
2015
1
1,444
$27.00
1%
12%
$38,988
1%
17% 
2016
3
33,098
$19.49
17%
29%
$645,186
17%
34% 
2017
6
74,975
$18.54
39%
68%
$1,390,298
36%
70% 
2018
0
0
$0.00
0%
68%
$0
0%
70% 
2019
1
3,299
$29.50
2%
70%
$97,320
3%
73% 
2020
0
0
$0.00
0%
70%
$0
0%
73% 
2021
1
58,505
$17.95
30%
100%
$1,050,000
27%
100% 
2022 & Beyond
0
0
$0.00
0%
100%
$0
0%
100% 
Vacant
0
0
$0.00
0%
100%
$0
0%
100% 
Total / Wtd. Avg.
17
193,301
$19.92
100%
  
$3,850,967
100%
  
   
(1)
The information in the lease rollover schedule is based on the underwritten rent roll.
 
(2)
Certain tenants may have lease termination options that are exercisable prior to the originally stated expiration date of the subject lease and that are not considered in the lease rollover schedule.
 
(3)
Average Underwritten Base Rent PSF Rolling excludes vacant space.
 
The Market. The Midtown Square Shopping Center Property is located in Troy, Michigan, approximately 16 miles northwest of the Detroit CBD, within the South Oakland submarket. Estimated population within a five-mile radius is approximately 240,705 and 98,230 within three miles. The sub-market retail vacancy is approximately 11.4% and the rental comparables vacancy rate is 13.0%. Average asking rental rates were $19.35 PSF during the third quarter of 2011. Downtown Birmingham Michigan is approximately 1 mile west of the property. Estimated average household income within a 5-mile radius is $91,583.
  
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
    
 
T-94
 
 
MSC 2012-C4  Midtown Square Shopping Center
  
The following table sets forth certain information regarding competitive anchored retail properties in the vicinity of the Midtown Square Shopping Center Property.
 
Competitive Property Summary
 
Property
Year Built
Total GLA
Recent Leases
Range of  Recent Rents PSF
 Occ.  
Canton Corners, 42405-42871 Ford Road, Canton Township MI
1988
196,587
AT&T, Game Stop, Scottrade, Inc., Sweet Treats
$25.00 - $30.72
88%   
Fairlane Green – Phase II, 3121 Fairlane Blvd., Allen Park MI
2006
118,950
Catherine, Potbelly, Best Buy, LA Fitness
$15.50 - $30.00
95%   
Kroger Center, 715 East Maple Road, Birmingham MI
2002
10,096(1)
Qdoba, Duru’s Custom Shirts
$25.01 - $33.00
70%(2)  
Adams Market Place, 2520 South Adams Rd., Rochester Hills MI
2009
100,161
Radio Shack, Burn Fitness, Marshall’s
$8.60 - $18.00
54%(3)   
Hampton Village Centre, 2627-2951 South Rochester Rd., Rochester Hills MI
1990
459,289
Ulta, Tuesday Morning, DSW Warehouse, TJ Maxx
$5.01 - $20.41
93%  
Woodhaven Commons, 19001 West Road, Woodhaven MI
1974
268,495
Ulta Salon
$21.50
85%  
 
Source: Appraisal
 
(1)
Kroger is a shadow anchor and is not included in the subject GLA.
 
(2)
The property recently lost one tenant.
 
(3)
The property is in lease-up.
 
Operating History and Underwritten Net Cash Flow. The following table presents certain information relating to the historical operating performance and the Underwritten Net Cash Flow at the Midtown Square Shopping Center Property:
 
Cash Flow Analysis
 
  
 
2009
  
2010
  
2011
  
UW
  
UW PSF
  
Gross Potential Rent(1)
$3,789,282
  
$3,777,086
  
$3,775,842
  
$3,850,967
  
$19.92
  
Total Reimbursements
$1,150,133
  
$1,152,916
  
$1,077,588
  
$1,312,000
  
$6.79
  
Other Income(2)
$38,773
  
$40,577
  
$51,855
  
$45,000
  
$0.23
  
Less Vacancy & Credit Loss
$0
  
$0
  
$0
  
($281,121)
  
($1.45)
  
Effective Gross Income
$4,978,188
  
$4,970,579
  
$4,905,285
  
$4,926,846
  
$25.49
  
Total Expenses
$1,199,435
  
$1,115,715
  
$1,148,712
  
$1,437,174
  
$7.43
  
Net Operating Income
$3,778,753
  
$3,854,864
  
$3,756,573
  
$3,489,673
  
$18.05
  
TI/LC
$0
  
$0
  
$0
  
$163,127
  
$0.84
  
Capital Expenditures
$0
  
$0
  
$0
  
$37,633
  
$0.19
  
Net Cash Flow
$3,778,753
  
$3,854,864
  
$3,756,573
  
$3,288,913
  
$17.01
  
Occupancy %
98.0%
  
100%
  
100%
  
92.7%
      
NOI DSCR
1.58x
  
1.62x
  
1.58x
  
1.46x
      
NCF DSCR
1.58x
  
1.62x
  
1.58x
  
1.38x
      
NOI Debt Yield
10.8%
  
11.0%
  
10.7%
  
10.0%
      
NCF Debt Yield
10.8%
  
11.0%
  
10.7%
  
9.4%
      
   
(1)
Historical Gross Potential Rent is net of vacancy. Underwritten Gross Potential Rent is net of approximately $85,280 in downward adjustments to rents deemed materially above market levels.
 
(2)
Other Income is comprised entirely of percentage rent payments.
 
Escrows and Reserves.  The Midtown Square Shopping Center Borrower deposited $104,737 in escrow for annual real estate taxes at loan origination and is required to escrow 1/12 of the annual estimated tax payments monthly. The Midtown Square Shopping Center Borrower is required to escrow 1/12 of the annual estimated insurance premiums monthly (unless the Midtown Square Shopping Center Borrower maintains insurance under an acceptable blanket insurance policy). The Midtown Square Shopping Center Borrower is also required to make monthly deposits of $3,061 for replacement reserves and $12,100 for TI/LC reserves, provided that such deposits are not required at any time that the amount then on deposit in the replacement reserve exceeds $58,000 or in the TI/LC reserve exceeds $750,000.
 
Lockbox and Cash Management. A hard lockbox is in place with respect to the Midtown Square Shopping Center Mortgage Loan. The Midtown Square Shopping Center Mortgage Loan has springing cash management. Provided a Cash Sweep Period has not commenced and is continuing, funds in the lockbox account are swept daily to an account designated by the Midtown Square Shopping Center Borrower. During the continuance of a Cash Sweep Period, funds in the lockbox account are applied on each monthly payment date to pay debt service on the Midtown Square Shopping Center Mortgage Loan and to fund the required reserves deposits as
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
    
 
T-95
 
 
MSC 2012-C4  Midtown Square Shopping Center
   
described above under “—Escrows and Reserves”, with any excess (net of profits from payments made by tenants attributable to electric resale at the Property as determined by lender which amounts will be disbursed to Midtown Square Shopping Center Borrower) being held by the mortgagee as additional security for the Midtown Square Shopping Center Mortgage Loan). A “Cash Sweep Period” will (i) commence upon (a) the occurrence and continuance of an event of default, (b) the date on which the debt service coverage ratio is less than 1.10x for six consecutive calendar months, or (c) the date which is twelve months prior to the expiration of the lease agreement dated August 16, 2000 made between the Midtown Square Shopping Center Borrower, as landlord, and Borman’s Inc., as tenant, and assigned to The Kroger Co. of Michigan (“Kroger”) on June 28, 2007, as amended (the “Kroger Lease”), unless either (1) Kroger has not notified the Midtown Square Shopping Center Borrower that it does not elect to renew the Kroger Lease for a term expiring not earlier than September 30, 2031 or (2) Kroger has entered into a renewal of the Kroger Lease expiring not earlier than September 30, 2026 and the debt service coverage ratio is not less than 1.25:1.0, and (ii) end on the date when (a) no event of default has occurred and is continuing, (b) the debt service coverage ratio is and shall have been for the immediately preceding three consecutive calendar months equal to or greater than 1.10x, or (c) either (1) Kroger has renewed the Kroger Lease for a term expiring not earlier than September 30, 2031, (2) Kroger has entered into a renewal of the Kroger Lease with a term not expiring earlier than September 30, 2026 and the debt service coverage ratio is not less than 1.25 to 1.0, (3) all or a portion of the Kroger lease space has been re-let to one or more Kroger replacement tenants and the debt service coverage ratio is not less than 1.25 to 1.0 or (4) the Midtown Square Shopping Center Borrower has delivered to mortgagee a letter of credit in a face amount equal to twelve months of excess cash flow, provided, however, that in no event shall the face amount of such letter of credit be less than $1,500,000.
 
Property Management. The Midtown Square Shopping Center Property is managed by Grand/Sakwa Management LLC, an affiliate of the Midtown Square Shopping Center Borrower.
 
Mezzanine Loan and Preferred Equity.  Not permitted.
 
Additional Secured Indebtedness (not including trade debts).  Not permitted.
 
Release of Parcels.  Not permitted.
 
Terrorism Insurance.  Generally, the Midtown Square Shopping Center Borrower is required to maintain (or cause to be maintained) insurance against loss for acts of terrorism with respect to the Midtown Square Shopping Center Property.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
    
 
T-96
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(THIS PAGE INTENTIONALLY LEFT BLANK)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
    
 
T-97
 
        
MSC 2012-C4 United HealthCare Services
 
Mortgage Loan No. 10 – United HealthCare Services
     
(PHOTO) 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
    
 
T-98
 
        
MSC 2012-C4 United HealthCare Services
           
Mortgage Loan No. 10 – United HealthCare Services
         
(MAP)
                  
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
    
 
T-99
 
        
MSC 2012-C4 United HealthCare Services
 
Mortgage Loan No. 10 – United HealthCare Services
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
BANA
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
13625 & 13675 Technology Drive
Eden Prairie, MN 55344
Original Balance:
$32,500,000
General Property Type:
Office
Cut-off Date Balance:
$32,500,000
  
Detailed Property Type:
Suburban
% of Initial Pool Balance:
3.0%
  
Net Rentable Area:
473,325 SF
Loan Purpose:
Acquisition
  
Cut-off Date Balance Per Unit/SF:
$69
Borrower Name(s):
AGNL Health, L.L.C.
  
Balloon/ARD Balance Per Unit/SF:
$63
Sponsor:
AG Net Lease II Corp.
  
Year Built / Year Renovated:
2001 / 2011
Mortgage Rate:
4.857%
  
Title Vesting:
Fee
Note Date:
2/29/2012
  
Property Manager:
Borrower/Owner Managed
First Payment Date:
4/1/2012
      
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
3/1/2022
  
UW Revenues:
$3,326,004
IO Period:
60 months
  
UW Expenses:
$66,520
Original Term to Maturity or ARD:
120 months
  
UW NOI:
$3,259,484
Seasoning:
0 months
  
UW NCF:
$3,141,153
Original Amortization Term:
360 months
  
UW NOI DSCR:
1.58x
Loan Amortization Type:
Partial IO
  
UW NCF DSCR:
1.53x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
10.0%
Prepayment Provisions:
LO (24); DEF (91); O (5)
  
UW NCF Debt Yield:
9.7%
Lockbox/Cash Management:
Hard / In-Place
  
UW NCF Debt Yield at Maturity:
10.5%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
NAP
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
NAP
Mezzanine Debt:
Future Mezzanine
  
Third Most Recent NOI (As of):
NAP
Reserves
  
Appraised Value:
$50,000,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
1/26/2012
Tax Reserve(1):
$0
Springing
NAP  
 
Cut-off Date LTV Ratio:
65.0%
Insurance Reserve(1):
$0
Springing
NAP  
 
LTV Ratio at Maturity/ARD:
59.9%
Replacement Reserve(1):
$0
Springing
NAP  
 
Occupancy Rate:
100.0% (3/1/2012)
TI/LC Reserve:
$0
$0
NAP  
 
2nd Most Recent Occupancy:
NAP
         
3rd Most Recent Occupancy:
NAP
 
(1)
The United HealthCare Services tenant pays taxes and insurance directly and is responsible for maintenance and repairs, see “—Escrows and Reserves” below.
 
The United HealthCare Services Mortgage Loan.
 
The Mortgage Loan.  The tenth largest mortgage loan (the “United HealthCare Services Mortgage Loan”) is an acquisition loan evidenced by a note in the original principal amount of $32,500,000 and is secured by a first priority fee mortgage encumbering a suburban office property known as United HealthCare Services (the “United HealthCare Services Property”). The United HealthCare Services Mortgage Loan was originated on February 29, 2012 by or on behalf of Bank of America, National Association.
 
The United HealthCare Services Mortgage Loan had an initial term of 120 months and has a remaining term of 120 months. The United HealthCare Services Mortgage Loan requires payments of interest only for the first 60 months of its term and principal and interest thereafter for the remainder of its term based on a 30-year amortization schedule. The scheduled maturity date is March 1, 2022. Defeasance with direct, non-callable obligations of the United States of America is permitted at any time on or after the first due date following the second anniversary of the securitization closing date. The United HealthCare Services Mortgage Loan is open to prepayment at par during the final 4 months of the loan term.
 
The Borrower and the Sponsor.  The borrower is AGNL Health, L.L.C., a single-purpose Delaware limited liability company with at least one independent director (the “United HealthCare Services Borrower”). The United HealthCare Services Borrower is owned 100% by AG Net Lease II Corp., the borrower principal and non-recourse guarantor of the United HealthCare Services Mortgage Loan. Equity ownership in AG Net Lease II Corp. is held by AG Net Lease Realty Fund II, L.P. (91%), the sponsor, and Net Lease Realty Fund (SO), L.P.
  
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
    
 
T-100
 
        
MSC 2012-C4 United HealthCare Services
      
AG Net Lease II Corp. is an affiliate of Angelo Gordon & Co., a privately held registered investment advisor dedicated to alternative investing. Angelo Gordon & Co. was founded in 1988 and currently manages approximately $22 billion. Angelo Gordon & Co. has acquired over $13.0 billion in real estate assets since 1993.
 
The Mortgaged Property. The United HealthCare Services Property is class “A” suburban office campus consisting of three, three-story office building containing 473,325 SF located in Eden Prairie, Minnesota. The United HealthCare Services Property is located at 13625 & 13675 Technology Drive and is bounded by State Highway 5 to the north, U.S. Highway 169 to the east, Flying Cloud Drive and Pioneer Trail to the south and Eden Prairie Road to the west. The United HealthCare Services sponsor purchased the United HealthCare Services Property in a sale/leaseback transaction in December 2011 for approximately $50 million. The United HealthCare Services Property contains 1,147 parking spaces in a four-level parking ramp as well as an additional 54 surface parking spaces for an overall parking ration of 2.54 spaces per 1,000 square feet of net rentable area. The United HealthCare Services Property, which was built in 2001 and renovated in 2011, is currently 100% leased by United HealthCare Services, Inc.
 
Sole Tenant.
 
United HealthCare Services, Inc. (473,325 SF, 100.0% NRA, 100.0 of underwritten base rent).  United HealthCare Services, Inc. (“United HealthCare Services”) leases 100.0% of the 473,325 SF at the United HealthCare Services Property under a 12-year, triple-net (NNN) lease expiring on December 12, 2023 with five, three-year renewal options. The lease provides for a rental rate of $6.60 PSF with 2.5% annual rent increases. Wells Fargo Bank, N.A. currently subleases 111,763 (23.6% of NRA) under a lease expiring October 12, 2015 with one, five-year renewal option. United HealthCare Services intends to occupy this space when it becomes available and income from this sublease was not included in the underwriting for the United HealthCare Services Mortgage Loan.
 
United HealthCare Services is a wholly owned subsidiary of UnitedHealth Group Incorporated (NYSE: UNH). UnitedHealth Group Incorporated is a leading healthcare company providing comprehensive healthcare services through six segments, including: UnitedHealthcare Employer & Individual, UnitedHealthcare Medicare & Retirement, UnitedHealthcare Community & State, OptumHealth, Optumsight and OptumRx, to over 75 million people worldwide. The United HealthCare Services Property will serve as the headquarters for the Optum business line, which through a combination of the three Optum segments forms a leading information and technology-enabled health services business that through its 30,000 combined workforce, serves the entire health ecosystem, including nearly 250,000 health professionals and physician practices, 6,200 hospitals and facilities, more than 270 state and federal government agencies, over 2,000 health plans, two of every five Fortune 500 employers, more than 400 global life sciences companies and one in every five U.S. consumers. As of the year ended December 31 2011, UnitedHealth Group Incorporated reported revenue of approximately $101.9 billion and net income of approximately $5.1 billion. UnitedHealth Group Incorporated is rated “A-” by Fitch, “A3” by Moody’s and “A-” by S&P.
 
The following table presents certain information relating to the tenant at the United HealthCare Services Property:
 
Tenant Summary
Tenant Name
Credit Rating
(Fitch/Moody’s/S&P)(1)
Tenant  
NRSF  
% of  
NRSF  
Annualized  
Underwritten  
Base Rent ($)  
% of Total  
Annual  
Underwritten  
 Base Rent  
Annualized  
Underwritten Base  
Rent ($ Per NRSF)  
Lease  
Expiration  
United HealthCare Services, Inc.
A-/A3/A-
473,325  
100%  
$3,501,057  
100%  
$7.40  
12/12/2023  
Total / Wtd. Avg.
  
473,325  
100%  
$3,501,057  
100%  
     
 
(1)
Certain ratings are those of the parent company whether or not the parent guarantees the lease.
 
The Market.  The United HealthCare Services Property is located in Eden Prairie south of State Highway 5 and west of U.S. Highway 169 approximately 16 miles southwest of the Minneapolis central business district in the Minneapolis-St. Paul-St. Cloud, MN-WI statistical area (also known as the “Twin Cities”).
 
The 2011 population of Twin Cities region was approximately 3.2 million and has grown at a rate of 1.0% over the past 10 years. Through 2015, population in the Twin Cities is expected to outpace the U.S. average and grow at an annual average rate of 1.1%. For the five-year period ending in 2010, the annual average unemployment rate for the Twin Cities was 5.7%, below the U.S. average of 6.8%. As of 2010, the average household income in the Twin Cities was $83,246. As of 2011, the estimated population within a one-, three- and five-mile radius of the United HealthCare Services Property was approximately 9,818, 55,765 and 138,189 respectively. As of 2011, the estimated average household income within a one-, three- and five-mile radius of the United HealthCare Services Property was approximately $87,314, $114,592 and $113,379, respectively.
 
Employment in the Twin Cities is concentrated in trade, transportation and utilities, education and health services, professional and business services and the government sector, representing 18.2%, 16.0%, 15.2% and 13.6%, respectively. The Twin Cities is home to eighteen of the nation’s Fortune 500 corporations, including: United Health Group, Target Corporation, Best Buy, Travelers Cos., 3M Corporation, U.S. Bancorp, Northwest Airlines, General Mills and Medtronic. The largest employers in the Twins Cities are Target Corporation (27,756 employees), Allina Health System (23,653 employees), Wells Fargo & Company (20,884 employees), Fairview Health System (20,148 employees), University of Minnesota (18,470 employees) and 3M Corporation (16,500 employees).
   
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
    
 
T-101
 
        
MSC 2012-C4 United HealthCare Services
     
The appraiser analyzed rent comparables ranging from 66,199 SF to 337,000 SF with net rental rates ranging from $6.00 PSF to $14.00 PSF and concluded an average market rental rate of $11.00 PSF. Six office rent comparables to the United HealthCare Services Property are shown in the table below:
 
Competitive Property Summary
 
Property
Address
City
State
Tenant Name
NRSF 
Rent  
PSF  
Lease Type
Meridian Crossings
One & Two Meridian Crossings
Richfield
MN
U.S. Bancorp
337,000  
$13.00  
Net
5995 Opus Parkway
5995 Opus Parkway
Minnetonka
MN
G&K
95,000  
$11.25  
Net
10350 Bren Road West
10350 Bren Road West
Minnetonka
MN
Digital River
132,000  
$6.00  
Net
One Southwest Crossing
11095 Viking Drive
Eden Prairie
MN
Cigna
211,105  
$12.00  
Net
Crosstown Centre
10050 Crosstown Circle
Eden Prairie
MN
Vacant
95,194  
$14.00  
Net
7500 Flying Cloud Drive
7500 Flying Cloud Drive
Eden Prairie
MN
Vacant
66,199  
$14.00  
Net
 
Source: Appraisal
 
Operating History and Underwritten Net Cash Flow.  The following table presents certain information relating to the Underwritten Net Cash Flow at the United HealthCare Services Property:
 
Cash Flow Analysis
  
 
UW
  
UW PSF
  
Gross Potential Rent
$3,501,057
  
$7.40
  
Total Reimbursements
$0
  
$0.00
  
Other Income
$0
  
$0.00
  
Less Vacancy & Credit Loss
($175,053)
  
($0.37)
  
Effective Gross Income
$3,326,004
  
$7.03
  
Total Operating Expenses
$66,520
  
$0.14
  
Net Operating Income
$3,259,484
  
$6.89
  
TI/LC
$0
  
$0.00
  
Capital Expenditures
$118,331
  
$0.25
  
Net Cash Flow
$3,141,153
  
$6.64
  
         
Occupancy %
95.0%
      
NOI DSCR
1.58x
      
NCF DSCR
1.53x
      
NOI Debt Yield
10.0%
      
NCF Debt Yield
9.7%
      
Average Annual Rent PSF
$7.40
      
 
Escrows and Reserves.  The United HealthCare Services Borrower is required under the terms of its lease to pay all taxes and insurance directly in connection with the United HealthCare Services Property. If the United HealthCare Services Borrower does not provide evidence to the lender that all taxes in connection with the United HealthCare Services Property have been paid and that an insurance policy is in place acceptable to the lender, escrows of 1/12 of the estimated taxes and insurance premium monthly will be required. In addition, provided no event of default, the United HealthCare Services Borrower will not be required to make monthly escrow deposits for capital expenditures so long as the United HealthCare Services Property is being maintained pursuant to the terms of its lease.
 
Lockbox and Cash Management. A hard lockbox is in place with respect to the United HealthCare Services Mortgage Loan. The United HealthCare Services Mortgage Loan has in place cash management. Funds in the lockbox account are swept daily to the cash management account and applied on each monthly payment date to pay debt service on the United HealthCare Services Mortgage Loan and to fund the required reserves deposits as described under “—Escrows and Reserves”, with any excess being remitted to the United HealthCare Services Borrower until the occurrence of a Cash Sweep Period, during which time any excess cash is held by the mortgagee as additional security for the United HealthCare Services Mortgage Loan. A “Cash Sweep Period” will generally commence if the debt service coverage ratio for the immediately preceding six month period is less than 1.20x and ending on the date the debt service coverage ratio equals or exceeds 1.35x for the immediately preceding three month period.
 
Property Management. The United HealthCare Services Property is managed by the United HealthCare Services Borrower.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
    
 
T-102
 
        
MSC 2012-C4 United HealthCare Services
   
Mezzanine Loan and Preferred Equity.  At any time after a date that is five years after the closing date of the United HealthCare Services Mortgage Loan or in connection with a sale of the United HealthCare Services Property to an unaffiliated third party purchaser, the United HealthCare Services Mortgage Loan documents permit mezzanine debt subject to various conditions including: (i) the combined debt service coverage ratio for the United HealthCare Services Mortgage Loan and the mezzanine loan on the date the mezzanine debt is incurred is not less than 1.40x, (ii) the aggregate sum of the United HealthCare Services Mortgage Loan and the mezzanine debt does not exceed a loan-to-value ratio on the date the mezzanine debt is incurred of 65% and (iii) the United HealthCare Services Mortgage Loan and the mezzanine debt have a combined debt yield on the date the mezzanine debt is incurred of not less than 9.50%.
 
Additional Secured Indebtedness (not including trade debts). Not permitted.
 
Release of Parcels.  Not permitted.
 
Terrorism Insurance.  The United HealthCare Services Borrower is required pursuant to the United HealthCare Services Mortgage Loan documents to maintain (or cause to be maintained) insurance against loss for acts of terrorism with respect to the United HealthCare Services Property, provided that the sole tenant (a) is permitted to self-insure (including for terrorism insurance) so long as its lease is in full force and effect and (b) currently self-insures (including for terrorism insurance). The current terrorism insurance was issued by an affiliate of the United HealthCare Services Borrower.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
    
 
T-103
 
 
MSC 2012-C4
Southbrook and Baybrook Village Center
 
Mortgage Loan No. 11 – Southbrook and Baybrook Village Center
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
BANA
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment (DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
1453-1501 West Bay Area Boulevard
Houston, TX 77598
Original Balance:
$31,140,000
  
General Property Type:
Retail
Cut-off Date Balance:
$30,995,567
  
Detailed Property Type:
Anchored
% of Initial Pool Balance:
2.8%
  
Net Rentable Area:
278,388 SF
Loan Purpose:
Acquisition
  
Cut-off Date Balance Per Unit/SF:
$111
Borrower Name(s):
OWRF Baybrook LLC
  
Balloon/ARD Balance Per Unit/SF:
$95
Sponsor:
O’Connor Associates L.P.
  
Year Built / Year Renovated:
1991 / 2009
Mortgage Rate:
6.050%
  
Title Vesting:
Fee
Note Date:
9/12/2011
  
Property Manager:
Wulfe Management Services, Inc.
First Payment Date:
11/1/2011
      
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
10/1/2021
  
UW Revenues:
$5,092,364
IO Period:
None
  
UW Expenses:
$1,637,523
Original Term to Maturity or ARD:    
120 months
  
UW NOI:
$3,454,841
Seasoning:
5 months
  
UW NCF:
$3,185,388
Original Amortization Term:
360 months
  
UW NOI DSCR:
1.53x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.41x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
11.1%
Prepayment Provisions:
LO (29); DEF (84); O (7)
  
UW NCF Debt Yield:
10.3%
Lockbox/Cash Management:
Hard / In-Place
  
UW NCF Debt Yield at Maturity:
12.0%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$2,889,904 (T-7 7/31/2011 Ann.)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$2,935,040 (12/31/2010)
Mezzanine Debt:
Permitted
  
Third Most Recent NOI (As of):
$2,659,335 (12/31/2009)
Reserves
  
Appraised Value:
$44,200,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
8/4/2011
Tax Reserve:
$598,000
$59,800
NAP  
  
Cut-off Date LTV Ratio:
70.1%
Insurance Reserve:
$0
Springing
NAP  
  
LTV Ratio at Maturity/ARD:
60.0%
Replacement Reserve:
$0
$3,480
NAP  
  
Occupancy Rate:
97.4% (1/19/2012)
TI/LC Reserve:
$145,000
$12,144
$290,000  
  
2nd Most Recent Occupancy:
81.3% (12/31/2010)
Other Reserve(1):
$1,400,000
$0
NAP  
  
3rd Most Recent Occupancy:
81.3% (12/31/2009)
 
(1)
An upfront reserve is in place for leasing costs associated with the K&G space.
 
The Southbrook and Baybrook Village Center property is a 278,388 SF power shopping center located in Houston, Texas that is 97.4% occupied as of January 19, 2012 by 22 tenants. The Southbrook and Baybrook Village Center Property’s diverse group of tenants include: Toys“R”Us, Sports Authority, Jo-Ann Fabric, PetSmart, K&G and Ross Stores. The largest tenant, Toys“R”Us (16.5% of SF, 12.9% of annual underwritten rent), is on a ground lease expiring in January 2017, with three five-year renewal options. Sports Authority (12.8% of SF, 10.7% of annual underwritten rent) is on a lease expiring in January 2022 with four five-year renewal options, replacing the former tenant, Linens and Things. Jo-Ann Fabrics (10.7% of SF, 8.8% of annual underwritten rent) is on a lease expiring in January 2019 with four five-year renewal options. PetSmart (10.5% of SF, 9.0% of annual underwritten rent) is on a lease expiring in April 2018 with three five-year renewal options. The other two major tenants are K&G (9.9% of SF, 7.1% of annual underwritten rent) and Ross Stores (9.7% of SF, 6.2% of annual underwritten rent). K&G has a termination option tied to sales that gives the tenant the right to terminate the lease with 120 days prior written notice if during the period of June 1, 2011 to May 31, 2012 sales do not exceed $5 million. Approximately $51 PSF was escrowed at closing for tenant improvement and leasing commissions associated with the re-letting of this space should K&G exercise its termination option.
 
The Southbrook and Baybrook Village Center property is located along West Bay Area Boulevard, immediately west of Interstate Highway 45, in the Clear Lake submarket of Houston, and across the street from Baybrook Mall, the second ranked suburban mall in Houston as measured by sales. The population within a one-, three- and five-mile radius of the Southbrook and Baybrook Village Center property is 8,957, 77,827 and 184,316, respectively. The average household income within a one-, three- and five-mile radius of the Southbrook and Baybrook Village Center property is $51,920, $73,178 and $92,077, respectively.
 
The Southbrook and Baybrook Village Center sponsor is O’Connor Associates, L.P., an affiliate of O’Connor Capital Partners, a privately owned, independent real estate investment trust and development firm founded in 1983. O’Connor Capital Partners has acquired or developed more than $20 billion of property for investment funds, institutional clients and its own account. The Southbrook and Baybrook Village Borrower purchased the Southbrook and Baybrook Village Center property for approximately $42.9 million with the proceeds from the mortgage loan and a cash contribution of approximately $14.8 million.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-104
 
 
MSC 2012-C4
                                                                                Forest Hills Village
 
Mortgage Loan No. 12 – Forest Hills Village
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
BANA
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
7927 Forest Hills Road, Loves Park,
IL 61111; 11701 North 2nd Street, Machesney Park, IL 61115
Original Balance:
$30,055,000
  
General Property Type:
Manufactured Housing
Cut-off Date Balance:
$30,055,000
  
Detailed Property Type:
Manufactured Housing
% of Initial Pool Balance:
2.7%
  
Number of Units/SF:
963 Pads
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$31,210
Borrower Name(s):
Forest Hills Village MHC LLC
  
Balloon/ARD Balance Per Unit/SF:
$25,719
Sponsor:
Edward C. Zeman
  
Year Built / Year Renovated:
1974-2000/ NAP
Mortgage Rate:
4.990%
  
Title Vesting:
Fee
Note Date:
2/28/2012
  
Property Manager:
Mobile Management Co., Inc.
First Payment Date:
4/1/2012
  
Underwriting and Financial Information
Anticipated Repayment Date:
NAP
  
UW Revenues:
$4,157,359
Maturity Date:
3/1/2022
  
UW Expenses:
$1,355,837
IO Period:
None
  
UW NOI:
$2,801,522
Original Term to Maturity or ARD:    
120 months
  
UW NCF:
$2,772,632
Seasoning:
0 months
  
UW NOI DSCR:
1.45x
Original Amortization Term:
360 months
  
UW NCF DSCR:
1.43x
Loan Amortization Type:
Amortizing
  
UW NOI Debt Yield:
9.3%
Interest Accrual Basis:
Actual/360
  
UW NCF Debt Yield:
9.2%
Prepayment Provisions:
LO (24); DEF (89); O (7)
  
UW NCF Debt Yield at Maturity:
11.2%
Lockbox/Cash Management:
Soft / Springing
  
Most Recent NOI (As of):
$2,701,231 (12/31/2011)
Pari Passu Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$2,633,206 (12/31/2010)
Subordinate Mortgage Debt:
None
  
Third Most Recent NOI (As of):
$2,644,914 (12/31/2009)
Mezzanine Debt:
None
  
Appraised Value:
$41,130,000
Reserves
  
Appraisal As-of Date:
2/8/2012
Type
Initial
Monthly
Cap  
  
Cut-off Date LTV Ratio:
73.1%
Tax Reserve:
$221,647
$31,664
NAP  
  
LTV Ratio at Maturity/ARD:
60.2%
Insurance Reserve:
$0
Springing
NAP  
  
Occupancy Rate:
92.6% (2/9/2012)
Replacement Reserve:
$0
$2,408
NAP  
  
2nd Most Recent Occupancy:
90.9% (12/31/2010)
         
3rd Most Recent Occupancy:
92.0% (12/31/2009)
 
The Forest Hills Village mortgaged property is comprised of two manufactured housing communities located three miles apart in Loves Park, Illinois (Forest Hills) and Machesney Park, Illinois (Forest View). Developed in phases between 1974 and 2000, Forest Hills is a 101-acre site with 633 pads for 510 single or double-wide sites and 123 double-wide sites. There are also 68 manufactured homes at Forest Hills, currently valuated at $2,890,347, which are a part of the collateral but have not been included in the appraised value. Developed in 1993, Forest View is a 146-acre site, with an additional 9.6 acres of surplus land zoned for manufactured housing, with 330 double-wide pad sites. The Forest Hills Village property was 92.6% occupied as of February 9, 2012 and has maintained a physical occupancy between 90.9 and 92.5% since 2007.
 
The Forest Hills Village property is located along the Rock River, approximately 80 miles northwest of Chicago, approximately 15 miles south of the Wisconsin border, and adjacent to the city of Rockford, Illinois. The Forest Hills Village property is in close proximity to Interstate 90, which provides direct access to Chicago, Illinois and Madison, Wisconsin. Major employers in the area include Rockford Health System, SwedishAmerican Health System, Wal-Mart Stores, Inc., Rockford Memorial Hospital and OSF Saint Anthony Medical Center. As of 2011, the estimated population within a one-, three- and five-mile radius of Forest Hills was approximately 8,980, 60,969 and 123,956, respectively, and the estimated average household income within a one-, three- and five-mile radius was approximately $53,030, $66,044 and $64,826, respectively. As of 2011, the estimated population within a one-, three- and five-mile radius of Forest View was approximately 3,086, 25,937 and 65,781, respectively, and the average household income within a one-, three- and five-mile radius was approximately $70,032, $70,579 and $67,706 respectively.
 
The Forest Hills Village sponsor, Edward C. Zeman, is the president of Zeman Homes & Neighborhoods, the eleventh largest manufactured home community owner/operator in the country. Zeman Homes & Neighborhoods provides residential and manufactured housing management and development services, and home financing and leasing services. Zeman Homes & Neighborhoods owns and operates 45 manufactured housing communities consisting of over 10,000 pad sites located in Illinois and Indiana.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-105
 
 
MSC 2012-C4
Mattel Building
 
Mortgage Loan No. 13 – Mattel Building
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
2031 E. Mariposa Avenue
El Segundo, CA 90245
Original Balance:
$29,500,000
General Property Type:
Office
Cut-off Date Balance:
$29,500,000
  
Detailed Property Type:
Suburban
% of Initial Pool Balance:
2.7%
  
Net Rentable Area:
192,000 SF
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$154
Borrower Name(s):
AGNL Toys, L.P.
  
Balloon/ARD Balance Per Unit/SF:
$142
Sponsor:
AG Net Lease II Corp.
  
Year Built / Year Renovated:
1954 / NAP
Mortgage Rate:
4.900%
  
Title Vesting:
Fee
Note Date:
2/14/2012
  
Property Manager:
Tenant-Managed
First Payment Date:
4/10/2012
      
Anticipated Repayment Date:
3/10/2022
  
Underwriting and Financial Information
Maturity Date:
3/10/2042
  
UW Revenues(2):
$4,186,060
IO Period:
60 months
  
UW Expenses:
$720,760
Original Term to Maturity or ARD:    
120 months
  
UW NOI:
$3,465,300
Seasoning:
0 months
  
UW NCF:
$3,196,810
Original Amortization Term:
360 months
  
UW NOI DSCR:
1.84x
Loan Amortization Type:
Partial IO
  
UW NCF DSCR:
1.70x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
11.7%
Prepayment Provisions:
LO (24); DEF (92); O (4)
  
UW NCF Debt Yield:
10.8%
Lockbox/Cash Management:
Hard / In Place
  
UW NCF Debt Yield at Maturity:
11.7%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
NAV
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
NAV
Mezzanine Debt:
None
  
Third Most Recent NOI (As of):
NAV
Reserves
  
Appraised Value:
$45,000,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
1/19/2012
Tax Reserve(1):
$0
Springing
NAP  
  
Cut-off Date LTV Ratio:
65.6%
Insurance Reserve(1):
$0
Springing
NAP  
  
LTV Ratio at Maturity/ARD:
60.5%
Replacement Reserve(1):
$0
Springing
NAP  
  
Occupancy Rate:
100.0% (12/31/2011)
TI/LC Reserve(1):
$0
Springing
NAP  
  
2nd Most Recent Occupancy:
100.0% (12/31/2010)
         
3rd Most Recent Occupancy:
100.0% (12/31/2009)
 
(1)
Monthly reserve collections are waived for taxes and insurance so long as there is no event of default under the loan or the lease, and the tenant is in occupancy and not in bankruptcy. Monthly reserve collections are waived for capital replacement costs, tenant improvements, and leasing commissions if the tenant maintains a minimum BB- credit rating or equivalent, and there is no event of default under the loan.  In addition, monthly reserve collections for capital replacement costs are waived because tenant is responsible for such costs pursuant to the lease.
 
(2)
UW Revenues reflect the average rental rate in place through the 10-year loan term, plus reimbursements. This equates to an underwritten base rent of $18.18 PSF. The current base rental rate is $16.13 PSF. The next scheduled base rent step is 5/1/2014 to $17.34 PSF. The final base rent step during the loan term is scheduled for 11/1/2021 to $21.54 PSF.
 
The Mattel Building property is a one-story, single-tenant office and research/development building, with a mezzanine component, containing 192,000 SF, located in El Segundo, California. The property was constructed in 1954 and has gone through periodic renovations. It currently serves as Mattel, Inc.’s global design facility, and has been occupied by the company since 1990. The tenant recently extended its lease expiration from 10/31/2016 to 10/31/2026. The property is located adjacent to Mattel’s global headquarters, and shuttles currently run between the two buildings every 15 minutes. Mattel, Inc. (NYSE: MAT), together with its subsidiaries, engages in the design, manufacture, and marketing of various toy products globally, including Barbie, Hot Wheels, WWE Wrestling, Fisher Price brands, and American Girl brands. The company is currently rated A- by Fitch, Baa1 by Moody’s, and BBB+ by S&P.
 
The Mattel Building property is located in the South Bay El Segundo office submarket, which, during the third quarter of 2011, had a reported 20.1% vacancy rate. The seven appraisal-provided rent comparables indicate NNN rents of $11.40 - $18.00 PSF.
 
The mortgage loan sponsor is an affiliate of Angelo, Gordon & Co., a privately held registered investment advisor founded in 1988. The company, which began investing in commercial real estate in 1993, has acquired over $13 billion of properties. The company maintains offices in New York, Los Angeles, Hong Kong, Seoul, Tokyo and Shanghai.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-106
 
 
MSC 2012-C4
Sirata Beach Resort
 
Mortgage Loan No. 14 – Sirata Beach Resort
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
5300 - 5396 Gulf Boulevard
St. Pete Beach, FL 33706
Original Balance:
$28,000,000
General Property Type:
Hospitality
Cut-off Date Balance:
$28,000,000
  
Detailed Property Type:
Full Service
% of Initial Pool Balance:
2.5%
  
Number of Units/SF:
382 Rooms
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$73,298
Borrower Name(s):
Sirata Beach Resort LLC
  
Balloon/ARD Balance Per Unit/SF:
$66,236
Sponsor:
The Nicklaus Family
  
Year Built / Year Renovated:
1958 / Various
Mortgage Rate:
5.800%
  
Title Vesting:
Fee
Note Date:
2/13/2012
  
Property Manager:
Sirata Beach Resort, LLC
First Payment Date:
4/10/2012
      
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
3/10/2017
  
UW Revenues:
$18,071,744
IO Period:
None
  
UW Expenses:
$13,472,581
Original Term to Maturity or ARD:    
60 months
  
UW NOI(2):
$4,599,163
Seasoning:
0 months
  
UW NCF:
$3,876,293
Original Amortization Term:
300 months
  
UW NOI DSCR:
2.17x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.83x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
16.4%
Prepayment Provisions:
YM1 (24); DEF/YM1 (32); O (4)
  
UW NCF Debt Yield:
13.8%
Lockbox/Cash Management:
Hard / Springing
  
UW NCF Debt Yield at Maturity:
15.3%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$5,386,572 (12/31/2011)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$4,423,226 (12/31/2010)
Mezzanine Debt:
None
  
Third Most Recent NOI (As of):
$5,576,801 (12/31/2009)
Reserves
  
Appraised Value:
$58,000,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
2/1/2012
Tax Reserve:
$126,636
$31,659
NAP  
  
Cut-off Date LTV Ratio:
48.3%
Insurance Reserve:
$55,624
$7,534
NAP  
  
LTV Ratio at Maturity/ARD:
43.6%
FF&E Reserve(1):
$2,000,000
Springing
NAP  
  
Occupancy Rate (As of):
73.0% (12/31/2011)
Def. Maint. Reserve:
$24,375
$0
NAP  
  
2nd Most Recent Occupancy (As of):
66.4% (12/31/2010)
         
3rd Most Recent Occupancy (As of):
71.2% (12/31/2009)
 
(1)  
Monthly FF&E escrows equal to 4% of gross revenues will commence with the 24th loan payment. The borrower escrowed $2,000,000 for certain planned upgrades, at loan closing. Planned upgrades include two restaurant renovations, replacement of case goods in all rooms, and certain fire safety improvements.
 
The Sirata Beach Resort property is an unflagged, full-service, 382-room (including 226 suites and efficiency units) beach resort located on the Gulf of Mexico in St. Pete Beach, Florida. The hotel was originally constructed as a beach-front motel in 1958, but has since been effectively rebuilt and enlarged through construction and acquisition of adjacent properties. The most recent expansion included a new tower with 80 suites constructed in 2000. Altogether, the hotel now consists of 9 buildings of 1 to 8 stories on 12.5 acres of land directly fronting the Gulf of Mexico. The property also includes 15,000 SF of conference and banquet space, two full service restaurants, two beach-front bars, three swimming pools, and a health club and spa. Approximately 80% of demand is derived from leisure travelers.
 
Eight competing hotels and resorts are noted in the subject market. Including the Sirata Beach Resort property, total room supply is 2,155 units with 2011 overall/average estimated occupancy of 73.4%, an ADR of $144.26, and a RevPAR of $105.89. The property had a 72.9% occupancy, an ADR of $115.80, a RevPAR of $84.42, an occupancy penetration of 99.3%, an ADR penetration of 80.3% and RevPAR penetration of 79.7%.
 
The mortgage loan sponsors are members of the Nicklaus family, which has owned the Sirata Beach Resort property for almost 50 years. Four siblings, H. Gregg Nicklaus, Lenne B. Nicklaus, Deborah L. Nicklaus and Valerie N. Hval, whose grandfather purchased the property in 1962, currently own, operate and manage the hotel.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-107
 
 
MSC 2012-C4
Hilton Springfield
 
Mortgage Loan No. 15 – Hilton Springfield
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/ Moody’s):
NR/NR/NR
  
Property Address:
6550 Loisdale Road
Springfield, VA 22150
Original Balance:
$25,900,000
General Property Type:
Hospitality
Cut-off Date Balance:
$25,900,000
  
Detailed Property Type:
Full Service
% of Initial Pool Balance:
2.4%
  
Number of Units/SF:
245 Units
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$105,714
Borrower Name(s):
Ramspring Limited Partnership
  
Balloon/ARD Balance Per Unit/SF:
$81,559
Sponsor:
Coakley & Williams
  
Year Built / Year Renovated:
1978 / 2008-2010
Mortgage Rate:
5.780%
  
Title Vesting:
Fee
Note Date:
3/1/2012
  
Property Manager:
Coakley & Williams Hotel Management Company
First Payment Date:
4/10/2012
    
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
3/10/2022
  
UW Revenues:
$12,712,336
IO Period:
None
  
UW Expenses:
$9,052,996
Original Term to Maturity or ARD:     
120 months
  
UW NOI:
$3,659,340
Seasoning:
0 months
  
UW NCF:
$3,150,850
Original Amortization Term:
300 months
  
UW NOI DSCR:
1.87x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.61x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
14.1%
Prepayment Provisions:
LO (24); DEF (92); O (4)
  
UW NCF Debt Yield:
12.2%
Lockbox/Cash Management:
Soft / Springing
  
UW NCF Debt Yield at Maturity:
15.8%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$3,645,411 (12/31/2011)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$3,477,660 (12/31/2010)
Mezzanine Debt:
Permitted
  
Third Most Recent NOI (As of):
$3,605,638 (12/31/2009)
Reserves
  
Appraised Value:
$49,000,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
1/12/2012
Tax Reserve:
$323,606
$39,982
NAP  
  
Cut-off Date LTV Ratio:
52.9%
Insurance Reserve:
$0
Springing
NAP  
  
LTV Ratio at Maturity/ARD:
40.8%
FF&E Reserve(1):
$2,500,000
$42,374
NAP  
  
Occupancy Rate (As of):
69.4% (12/31/2011)
Def. Maint. Reserve:
$260,000
$0
NAP  
  
2nd Most Recent Occupancy (As of):
58.8% (12/31/2010)
Other Reserve(2):
$1,000,000
Springing
NAP  
  
3rd Most Recent Occupancy (As of):
56.7% (12/31/2009)
             
 
(1)
The lender holds a $2,500,000 reserve for elective upgrades anticipated for completion in Year 1 of the loan term. These planned costs include the renovation of the property ballrooms, restaurant and main lobby.
 
(2)
The lender holds a $1,000,000 reserve for certain legal post-closing obligations. In addition, on the date that any Property Improvement Plan is imposed by the franchisor pursuant to the franchise agreement, borrower is required to deposit 125% of the sum required.
 
The Hilton Springfield property is 245-room full service Hilton hotel in Springfield, Virginia, 13 miles south of Washington D.C. The property is located just off Interstate 95 one exit south of the interchange with Interstate 495 (The Capital Beltway), and approximately 11 miles south of the Pentagon. The 12-story property was constructed in 1978, renovated between 2008 and 2010, and includes 7,814 SF of banquet and meeting space. A 328-seat Houlihan's Restaurant and Bar is located at the property and is operated by the borrower under a franchise agreement. Other amenities include an indoor swimming pool and fitness center. Demand generators include the Federal Government (Fort Belvoir, National Geospatial Intelligence Agency, Defense Logistics Command, Customs, Coast Guard, and the Homeland Security Agency). Private demand generators include Accenture, Boeing Preferred, Booze Allen, Microsoft, Hewlett Packard, Lockheed Martin, Northrop Grumman, Raytheon, and SAIC. Approximately 85% of the weekday business is defense contractor related. The Base Realignment and Closure Act (BRAC) led to the relocation of several military Departments and Agencies to Fort Belvoir and the surrounding area.
 
Eight competing hotels are noted in the subject market, although the Hilton Springfield property is the only full service hotel in the submarket. Including the property, total room supply is 1,506 units with 2011 overall/average estimated occupancy of 68.0%, an ADR of $135.37, and a RevPAR of $92.06. In 2011, the property reported an average occupancy of 69.4%, an ADR of $150.83, a RevPAR of $104.72, an occupancy penetration of 102.1%, an ADR penetration of 111.4% and RevPAR penetration of 113.8%.
 
The Hilton Springfield property is owned and operated by affiliates of Coakley & Williams Hotel Management Company, which manages a portfolio of 26 hotels with approximately 4,000 rooms in 13 states and Washington, D.C. The company, or its predecessors, developed its first hotel property in 1971.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-108
 
 
MSC 2012-C4
U-Haul 2011 Portfolio
 
Mortgage Loan No. 16 – U-Haul 2011 Portfolio
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
BANA
  
Single Asset/ Portfolio:
Portfolio
Credit Assessment (DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
Various(2)
Original Balance:
$25,000,000
General Property Type:
Self Storage
Cut-off Date Balance:
$25,000,000
  
Detailed Property Type:
Self Storage
% of Initial Pool Balance:
2.3%
  
Number of Units/SF:
375,593 SF
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$67
Borrower Name(s):
Twenty SAC Self-Storage Corporation
  
Balloon/ARD Balance Per Unit/SF:
$56
Sponsor:
SAC Holding Corporation;
Blackwater Investments, Inc.
  
Year Built / Year Renovated:
Various(2)
Mortgage Rate:
5.775%
  
Title Vesting:
Fee
Note Date:
2/28/2012
  
Property Manager:
U-Haul International, Inc.
First Payment Date:
4/1/2012
      
Anticipated Repayment Date:
3/1/2022
  
Underwriting and Financial Information
Maturity Date:
3/1/2032
  
UW Revenues:
$4,838,271
IO Period:
None
  
UW Expenses:
$1,674,486
Original Term to Maturity or ARD:     
120 months
  
UW NOI:
$3,163,785
Seasoning:
0 months
  
UW NCF:
$3,080,315
Original Amortization Term:
360 months
  
UW NOI DSCR:
1.80x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.75x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
12.7%
Prepayment Provisions:
LO (24); DEF/YM1 (93); O (3)
  
UW NCF Debt Yield:
12.3%
Lockbox/Cash Management:
Soft / Springing
  
UW NCF Debt Yield at Maturity:
14.6%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$3,413,145 (TTM 9/30/2011)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$3,327,926 (12/31/2010)
Mezzanine Debt:
None
  
Third Most Recent NOI (As of):
$3,443,478 (12/31/2009)
Reserves
  
Appraised Value:
$36,120,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
10/21/2011 - 11/5/2011
Tax Reserve:
$217,330
Springing
NAP  
  
Cut-off Date LTV Ratio:
69.2%
Insurance Reserve:
$0
Springing
NAP  
  
LTV Ratio at Maturity/ARD:
58.5%
Replacement Reserve:
$175,000
$6,958
$175,000  
  
Occupancy Rate:
83.5% (12/5/2011)
Other Reserve(1):
$162,676
$0
NAP  
  
2nd Most Recent Occupancy:
78.0% (12/31/2010)
         
3rd Most Recent Occupancy:
77.2% (12/31/2009)
 
(1)  
The U-Haul 2011 Portfolio borrower is required also to escrow $162,676 for immediate repairs.
 
(2)  
See table below.
 
The U-Haul 2011 Portfolio mortgage loan is secured by nine self-storage properties built between 1950 and 1981, located in eight states (Arizona, California, Georgia, New Jersey, Oregon, Rhode Island, Texas and Virginia.)  The U-Haul 2011 Portfolio property consists of 4,619 storage units (approximately 24% are climate controlled) and fourteen parking storage spaces for RV/boats.
 
The U-Haul 2011 Portfolio properties are operated by U-Haul International, Inc., a subsidiary of AMERCO (NASDAQ: UHAL).  AMERCO, through U-Haul International, Inc., is a do-it-yourself moving and storage operator founded in 1945 and based in Reno, Nevada that supplies products and services to help people move and store household and commercial goods in the United States and Canada. U-Haul International, Inc. engages in the rental of trucks, trailers and self-storage spaces through a network of approximately 1,400 company operated retail moving centers and approximately 15,000 independent U-Haul dealers.
 
The U-Haul 2011 Portfolio mortgage loan sponsors are SAC Holding Corporation and its parent company, Blackwater Investments, Inc. Mark Shoen, who together with his two brothers collectively own 47.0% of AMERCO, is the sole owner (100%) of both sponsors. Blackwater Investments Inc., through its subsidiaries including SAC Holding Corporation, owns over 212,000 self-storage units comprising over 19.7 million SF.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-109
 
 
MSC 2012-C4
U-Haul 2011 Portfolio
 
The following table sets forth further information regarding the U-Haul 2011 Portfolio Property:
 
Property Summary
Property
Location
Allocated Loan Amount
% of
Allocated
Loan Amount
Appraised Value
Year Built/
Renovated
Percent
Leased
     Net Rentable   
Area (SF)  
U-Haul Atlanta
Atlanta, GA
$7,420,000
30%
$10,600,000
1950 / NAP
78.1%
111,839  
U-Haul San Antonio
San Antonio, TX
3,860,000
15%
5,520,000
1965 / 1982
94.0%
41,650  
U-Haul Warwick
Warwick, RI
3,360,000
13%
4,800,000
1978 / NAP
89.3%
43,479  
U-Haul Lemon Grove
Lemon Grove, CA
3,235,000
13%
4,700,000
1961 / NAP
85.4%
21,062  
U-Haul Arlington
Arlington, TX
1,975,000
8%
2,900,000
1979 / NAP
93.8%
43,496  
U-Haul Mesa
Mesa, AZ
1,760,000
7%
2,700,000
1978 / NAP
86.1%
41,000  
U-Haul Portsmouth
Portsmouth, VA
1,610,000
6%
2,300,000
1973 / NAP
80.0%
28,163  
U-Haul Toms River
Toms River, NJ
1,110,000
4%
1,600,000
1954 / 1975
63.9%
27,904  
U-Haul Bend
Bend, OR
670,000
3%
1,000,000
1981 / NAP
81.3%
17,000  
Total / Weighted Average
     $25,000,000
100%
$36,120,000
  
83.5%
375,593 
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-110
 
 
MSC 2012-C4
Independence Hill Independent Living
 
Mortgage Loan No. 17 – Independence Hill Independent Living
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
20450 Huebner Road
San Antonio, TX 78258
Original Balance:
$22,000,000
General Property Type:
Multifamily
Cut-off Date Balance:
$22,000,000
  
Detailed Property Type:
Senior Housing
% of Initial Pool Balance:
2.0%
  
Number of Units:
292 Units
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$75,342
Borrower Name(s):
Stone Oak Villas I, Ltd.
  
Balloon/ARD Balance Per Unit/SF:
$63,655
Sponsor:
Gary J. Katleman, Jeannine DeVetter
  
Year Built / Year Renovated:
1987 / 2001
Mortgage Rate:
5.790%
  
Title Vesting:
Fee
Note Date:
2/29/2012
  
Property Manager:
Dial Communities, Inc.
First Payment Date:
4/10/2012
      
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
3/10/2022
  
UW Revenues:
$8,882,914
IO Period:
None
  
UW Expenses:
$6,170,677
Original Term to Maturity or ARD:    
120 months
  
UW NOI:
$2,712,237
Seasoning:
0 months
  
UW NCF:
$2,624,637
Original Amortization Term:
360 months
  
UW NOI DSCR:
1.75x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.70x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
12.3%
Prepayment Provisions:
LO (24); DEF (92); O (4)
  
UW NCF Debt Yield:
11.9%
Lockbox/Cash Management:
Hard / Springing
  
UW NCF Debt Yield at Maturity:
14.1%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$2,439,113 (12/31/2011)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$2,852,783 (12/31/2010)
Mezzanine Debt:
None
  
Third Most Recent NOI (As of):
$3,416,930 (12/31/2009)
Reserves
  
Appraised Value:
$37,850,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
1/24/2012
Tax Reserve:
$79,569
$26,523
NAP  
  
Cut-off Date LTV Ratio:
58.1%
Insurance Reserve:
$7,987
$7,616
NAP  
  
LTV Ratio at Maturity/ARD:
49.1%
Replacement Reserve(1):
$2,300,000
$7,300
NAP  
  
Occupancy Rate (As of):
88.4% (2/3/2012)
         
2nd Most Recent Occupancy (As of):
87.7% (12/31/2010)
         
3rd Most Recent Occupancy (As of):
91.4% (12/31/2009)
 
(1)
The lender holds a $2,300,000 reserve for certain specified elective upgrades to be performed post-closing, including new siding and landscaping.
 
The Independence Hill Independent Living property is an independent-living retirement facility containing 292 units ranging in size from 572 to 1,107 SF in two 3- and 4-story main buildings and 10 two-story cottages in San Antonio, TX. Rents range from $1,395 to $4,015 per unit per month and include two meals a day, as well as interior- and exterior-home and yard-maintenance and amenities such as housekeeping and linen service, on-site cafeteria and café, concierge services, scheduled transportation for shopping, church services and appointments, massage therapist and personal trainer, on-site beauty shop and banking services, outdoor heated pool, and guest suites. The residents also have privileges at The Club at Sonterra, a nearby private club that offers golf, tennis, swimming, and social events. There are no nursing or assisted-living services offered at the Independence Hill Independent Living property, which is part of the larger Independence Village at Stone Oak community of independent-living and assisted-living retirement facilities and single-family independent-living villas. The Independence Hill Independent Living property is currently 88% occupied; the average competitor occupancy of 86%.
 
The full-service hospital nearest the subject property is North Central Baptist Hospital, located just south of the subject site. There are seven other major hospitals located within several miles of the subject, including the University Hospital, Southwest Texas Methodist Hospital, Methodist Children’s Hospital, St. Luke’s Baptist Hospital, Christus Santa Rosa Medical Center, and the Audi L. Murphy V.A. Hospital.
 
Dial Communities, Inc. (Dial Communities), the parent company of Dial Realty, Corp., is engaged in planning, acquisition, development, financing, construction, leasing, and management of real estate that includes single-family housing, apartment communities, shopping centers, office buildings, senior housing facilities and hotels across the Midwest and Texas. Dial Communities is a real estate investment and development company founded in 1968 and principally operated by Joel Katleman (Chairman) and his son, Gary Katleman (President and CEO). Dial Communities is involved in the acquisition, development, and management of apartment and retirement communities throughout San Antonio, Texas.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-111
 
 
MSC 2012-C4
Independence Place - Fort Campbell
 
Mortgage Loan No. 18 – Independence Place - Fort Campbell
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
 
3193 Fort Campbell Boulevard
Clarksville, TN 37042
Original Balance:
$20,800,000
General Property Type:
Multifamily
Cut-off Date Balance:
$20,800,000
  
Detailed Property Type:
Garden/Military Housing
% of Initial Pool Balance:
1.9%
  
Number of Units:
228 Units
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$91,228
Borrower Name(s):
Independence Place Fort Campbell Patriots, LLC
  
Balloon/ARD Balance Per Unit/SF:
$69,997
Sponsor:
Cecil Phillips; Place Base Housing, LLC
  
Year Built / Year Renovated:
2009 / NAP
Mortgage Rate:
5.620%
  
Title Vesting:
Fee
Note Date:
3/1/2012
  
Property Manager:
Place Management Group, LLC
First Payment Date:
4/10/2012
      
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
3/10/2022
  
UW Revenues:
$3,801,245
IO Period:
None
  
UW Expenses:
$1,567,104
Original Term to Maturity or ARD:    
120 months
  
UW NOI:
$2,234,141
Seasoning:
0 months
  
UW NCF:
$2,072,141
Original Amortization Term:
300 months
  
UW NOI DSCR:
1.44x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.34x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
10.7%
Prepayment Provisions:
LO (24); DEF (92); O (4)
  
UW NCF Debt Yield:
10.0%
Lockbox/Cash Management:
Soft / Springing
  
UW NCF Debt Yield at Maturity:
13.0%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$1,744,675 (12/31/2011)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$834,725 (12/31/2010)
Mezzanine Debt:
None
  
Third Most Recent NOI (As of):
NAP
Reserves
  
Appraised Value:
$30,600,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
9/19/2011
Tax Reserve:
$56,790
$28,395
NAP  
  
Cut-off Date LTV Ratio:
68.0%
Insurance Reserve:
$0
Springing
NAP  
  
LTV Ratio at Maturity/ARD:
52.2%
Replacement Reserve:
$0
$13,509
NAP  
  
Occupancy Rate (As of):
82.4% (2/25/2012)
Def. Maint. Reserve:
$4,688
$0
NAP  
  
2nd Most Recent Occupancy (As of):
88.4% (12/5/2011)
         
3rd Most Recent Occupancy (As of):
48.0% (12/25/2010)
 
The Independence Place - Fort Campbell property is a three-story, 228-unit garden-style apartment complex built in 2009 and located in Clarksville, Tennessee. The property consists of 14 buildings and has 24 one-bedroom/one-bathroom units averaging 697 SF, 96 two-bedroom/ two-bathroom units averaging 906 SF, and 108 four-bedroom/ four-bathroom units averaging 1,414 SF. Leases are typically by the bedroom to accommodate varying troop deployment schedules. The property is located directly across Fort Campbell Boulevard from the Ft. Campbell main entrance and is occupied primarily by military personnel and civilian workforce and contractors associated with the base. Ft. Campbell was ranked 14 out of 97 installations according to the Military Value of Installations section contained within the Department of the Army Analysis and Recommendations May 2005 BRAC report. Units are generally leased furnished. Property amenities include cable TV with HBO, washers and dryers in each unit, internet service, a swimming pool, a fitness center, a basketball court, a sand volleyball court, a computer lab, a game room with pool tables, plasma TVs and gaming stations, a tanning dome, a putting green and outdoor grilling stations.
 
The five noted comparable properties were built between 2004 and 2010 and have current occupancies from 90% to 98%. The comparable properties range in average size from 909 SF to 1,012 SF, compared to 1,125 SF for the Independence Place - Fort Campbell property. The property is unique in the market in that the apartments are furnished and most utilities are included in the rental rates.
 
The mortgage loan sponsors are Mr. Cecil Phillips and Place Base Housing, LLC. In 1984, Mr. Phillips founded Phillips International, the predecessor to Place Properties, LP that financed and developed on-campus and off-campus student housing at major US colleges and universities, medical office buildings, shopping centers, and multi-family housing projects, hotels, golf courses, resorts, residential developments, as well as land held for commercial and recreational development. Mr. Phillips has financed, developed, and overseen the development of more than 33,000 bedrooms of on-campus and off-campus housing at 30 different campuses. Place Base Housing, LLC currently has a portfolio of nine military housing properties (including the subject) that total 2,212 units and 5,268 beds. The company has developed eight of the military properties under the Independence Place brand.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-112
 
 
MSC 2012-C4
University Park Shopping Center
 
Mortgage Loan No. 19 – University Park Shopping Center
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
 
 
 
3909 East Evans, 2033, 2043 & 2073 South Colorado Boulevard and 3970 East Buchtel Boulevard Denver, CO 80210
Original Balance:
$20,450,000
Cut-off Date Balance:
$20,181,264
General Property Type:
Retail
% of Initial Pool Balance:
1.8%
  
Detailed Property Type:
Unanchored
Loan Purpose:
Refinance
  
Net Rentable Area:
76,006 SF
Borrower Name(s):
UPSC LLC
  
Cut-off Date Balance Per Unit/SF:
$266
Sponsor:
Jeff Oberg
  
Balloon/ARD Balance Per Unit/SF:
$225
Mortgage Rate:
5.830%
  
Year Built / Year Renovated:
2007 / NAP
Note Date(1):
12/22/2010
  
Title Vesting:
Fee
First Payment Date:
2/5/2011
  
Property Manager:
St. Charles Realty Management, LLC
Anticipated Repayment Date:
NAP
      
Maturity Date:
3/5/2022
  
Underwriting and Financial Information
IO Period:
None
  
UW Revenues:
$2,438,720
Original Term to Maturity or ARD:   
134 months
  
UW Expenses:
$491,831
Seasoning:
14 months
  
UW NOI:
$1,946,889
Original Amortization Term:
360 months
  
UW NCF:
$1,848,841
Loan Amortization Type:
Amortizing
  
UW NOI DSCR:
1.37x
Interest Accrual Basis:
Actual/360
  
UW NCF DSCR:
1.30x
Prepayment Provisions:
LO (38); DEF (92); O (4)
  
UW NOI Debt Yield:
9.6%
Lockbox/Cash Management:
Hard / Springing
  
UW NCF Debt Yield:
9.2%
Pari Passu Mortgage Debt:
None
  
UW NCF Debt Yield at Maturity:
10.8%
Subordinate Mortgage Debt:
None
  
Most Recent NOI (As of):
$1,635,873 (12/31/2011)
Mezzanine Debt:
None
  
Second Most Recent NOI (As of):
$1,719,147 (12/31/2010)
     
Third Most Recent NOI (As of):
$1,332,104 (12/31/2009)
Reserves
  
Appraised Value:
$30,365,000
Type
Initial
Monthly
Cap
  
Appraisal As-of Date:
2/10/2012
Tax Reserve(2):
$149,388
$25,246/Springing
NAP
  
Cut-off Date LTV Ratio:
66.5%
Insurance Reserve(2):
$3,315
$1,105/Springing
NAP
  
LTV Ratio at Maturity/ARD:
56.2%
Replacement Reserve:
$0
$950
NAP
  
Occupancy Rate(4):
86.9% (12/31/2011)
TI/LC Reserve:
$0
$6,334
NAP
  
2nd Most Recent Occupancy:
91.0% (12/31/2010)
Earnout Reserve(3):
$1,300,000
$0
NAP
  
3rd Most Recent Occupancy:
85.7% (12/31/2009)
 
(1)
The loan was originated on December 22, 2010. In January 2011, a tenant occupying 19,392 sq. ft. filed for bankruptcy protection and subsequently vacated the property. The loan sponsor subsequently executed a lease for the vacated space (see footnote 4 below) and the loan was modified on March 1, 2012 to extend the loan term to March 5, 2022 and lend an additional $1,300,000 into a lender controlled escrow account (see footnote 3 below).
 
(2)
The borrower makes monthly deposits of $25,246 and $1,105 for taxes and insurance reserves for the entirety of the property excluding the portion occupied by Office Depot. At lender’s option, additional deposits allocable to Office Depot will spring upon event of default, the tenant rating dropping below BBB-, or failure to provide evidence of tax and insurance payments
 
(3)
Lender holds a $1,300,000 earnout reserve that may be disbursed to the borrower from time to time upon satisfaction of certain conditions, including a 10.5% NOI debt yield and either (a) construction of a new building on the parcel the borrower plans to develop, or (2) lender’s receipt of a fully executed ground lease for the parcel. Any funds remaining on deposit on March 5, 2015 shall be applied to the outstanding loan balance accompanied by a yield maintenance premium.
 
(4)
The occupancy figure as of 12/31/2011 includes Vitamin Cottage occupying 19,392 SF and Procuts occupying 1,393 SF. Vitamin Cottage Natural Grocers currently occupies 9,968 SF at the property and recently signed an amendment to relocate to the vacant 19,392 SF space at $23.26 PSF. The 9,968 SF space is underwritten as vacant. Procuts has executed a lease for 1,393 SF at $30 PSF for five years. Both tenant spaces are currently being prepared for occupancy.
 
The University Park Shopping Center property is a 76,006 SF neighborhood shopping center consisting of four separate buildings on a 6.71 acre parcel in Denver, Colorado. The property is anchored by a 21,666 SF Office Depot, which has been a tenant since 2007 and is leased through 9/30/2017 with five 5-year renewal options. Other tenants include Vitamin Cottage Natural Grocers, which is expanding at the property from 9,968 SF to 19,392 SF on a lease until May 31, 2022, Wells Fargo Bank, and Pei Wei Asian Diner, which reported annualized sales of $428 PSF as of January 2012. The property includes a 0.74-acre parcel on which the borrower plans to develop a pad site.
 
The University Park Shopping Center property is located in the University/DU neighborhood, which is located approximately seven miles southeast of the Denver CBD.  The 2011 population and average household income within a 5-mile radius are estimated at 406,544, and $68,367, respectively. The six rental comparables had occupancies ranging from 85% to 100%.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-113
 
 
MSC 2012-C4
Livermore Medical Office
 
Mortgage Loan No. 20 – Livermore Medical Office
 
Mortgage Loan Information
  
Mortgaged Property Information
Mortgage Loan Seller:
MSMCH
  
Single Asset/ Portfolio:
Single Asset
Credit Assessment
(DBRS/KBRA/Moody’s):
NR/NR/NR
  
Property Address:
 
1133 East Stanley Blvd.
Livermore, CA 94550
Original Balance:
$16,500,000
General Property Type:
Office
Cut-off Date Balance:
$16,436,723
  
Detailed Property Type:
Medical
% of Initial Pool Balance:
1.5%
  
Net Rentable Area:
63,576 SF
Loan Purpose:
Refinance
  
Cut-off Date Balance Per Unit/SF:
$259
Borrower Name(s):
LMOA LLC
  
Balloon/ARD Balance Per Unit/SF:
$221
Sponsor:
Joseph W. Callahan, Jr.
  
Year Built / Year Renovated:
2003 / NAP
Mortgage Rate:
6.010%
  
Title Vesting:
Leasehold
Note Date:
11/8/2011
  
Property Manager:
Callahan Property Company, Inc.
First Payment Date:
12/10/2011
      
Anticipated Repayment Date:
NAP
  
Underwriting and Financial Information
Maturity Date:
11/10/2021
  
UW Revenues:
$2,504,038
IO Period:
None
  
UW Expenses:
$684,496
Original Term to Maturity or ARD:
120 months
  
UW NOI:
$1,819,542
Seasoning:
4 months
  
UW NCF:
$1,698,653
Original Amortization Term:
360 months
  
UW NOI DSCR:
1.53x
Loan Amortization Type:
Amortizing
  
UW NCF DSCR:
1.43x
Interest Accrual Basis:
Actual/360
  
UW NOI Debt Yield:
11.1%
Prepayment Provisions:
LO (28); DEF (88); O (4);
  
UW NCF Debt Yield:
10.3%
Lockbox/Cash Management:
Hard / Springing
  
UW NCF Debt Yield at Maturity:
12.1%
Pari Passu Mortgage Debt:
None
  
Most Recent NOI (As of):
$1,956,335 (12/31/2011)
Subordinate Mortgage Debt:
None
  
Second Most Recent NOI (As of):
$1,864,672 (12/31/2010)
Mezzanine Debt:
None
  
Third Most Recent NOI (As of):
$1,786,972 (12/31/2009)
Reserves
  
Appraised Value:
$24,150,000
Type
Initial
Monthly
Cap  
  
Appraisal As-of Date:
7/26/2011
Tax Reserve:
$40,074
$13,358
NAP  
  
Cut-off Date LTV Ratio:
68.1%
Insurance Reserve:
$0
$0
NAP  
  
LTV Ratio at Maturity/ARD:
58.1%
Replacement Reserve:
$0
$1,377
$38,145  
  
Occupancy Rate:
100.0% (2/3/2012)
TI/LC Reserve:
$0
$7,947
$286,097  
  
2nd Most Recent Occupancy:
100.0% (12/31/2010)
         
3rd Most Recent Occupancy:
100.0% (12/31/2009)
 
The Livermore Medical Office property is a 63,576 SF medical office building constructed in 2003 and located in Livermore, California, approximately 35 miles southeast of downtown San Francisco The property is on the ValleyCare Livermore Medical Campus, which contains Valley Memorial Center and Lifestyle Rx. Valley Memorial Center is a 91,758 SF acute rehabilitation and skilled nursing facility with 110 beds. It also contains diagnostic imaging, laboratory, office and occupational health facilities. Lifestyle Rx is a 67,528 SF medical fitness and rehabilitation center. Both Valley Memorial Center and Lifestyles Rx are owned and operated by the property’s largest tenant, ValleyCare Health System. ValleyCare is a private, not-for-profit health system located in Pleasanton and Livermore, CA. ValleyCare leases 8 spaces in the property totaling 49,619 SF, including a 34,159 SF urgent care facility. The Livermore Medical Office property is subject to an unsubordinated ground lease that commenced in June 2003 and has an initial expiration of June 14, 2058, with one 10-year extension option.
 
Estimated 2011 population within a five-mile radius was 110,094. The East Bay Medical Office occupancy rate is 95% to 100% and the average Livermore medical office occupancy rate is 99.1%.
 
This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-114
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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This is not a research report and was not prepared by the Morgan Stanley or BofA Merrill Lynch research departments. Please see additional important information and qualifications at the end of this Term Sheet.
 
 
T-115
 
 
MSC 2012-C4
 
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