Fitch Affirms UBSBB 2012-C2

Fitch Ratings has affirmed 13 classes of UBS-Barclays Commercial Mortgage Trust 2012-C2 (UBSBB 2012-C2) commercial mortgage pass-through certificates as a result of stable performance of the underlying pool. A detailed list of rating actions follows at the end of this release.

KEY RATING DRIVERS

The affirmations are based on the overall stable performance of the underlying collateral pool. Although very little change has occurred in credit enhancement since issuance, there were three instances of variance from criteria related to classes D through F, where Fitch's surveillance criteria would indicate that an upgrade is possible. Fitch determined that upgrades are not warranted at this time in the cycle of the deal as no material change to the portfolio has occurred since issuance. As of the April 2016 distribution date, the pool's aggregate principal balance has been reduced by only 6.1% through loan amortization. The current deal balance is $1.14 billion compared to $1.22 billion at issuance. Further, the pool is concentrated with only 54 loans; none paid off in full since issuance, and only four loans (16.3% of the pool) are scheduled to mature before 2022. There is further concentration by asset type with loans secured by retail properties comprising 46% of the portfolio; regional malls total 29% of the pool (including five of the Top 15 loans).

Fitch has designated only two loans as Fitch Loans of Concern (0.46%), and no loans are currently in special servicing. Per the servicer reporting, three loans (1.2% of the pool) are defeased. Interest shortfalls are currently affecting class H. The pool has experienced no realized losses to date.

The largest loan in the pool is secured by 110 William Street (12.1% of the pool), a 920,000 square foot (sf), 32-story office building located in downtown Manhattan, at the intersection of William Street and John Street. The property is located five blocks north of the New York Stock Exchange and has direct access to the recently constructed Fulton Street Transit Center. As of the February 2016 rent roll, the property was 91.3% occupied with less than 5% tenant roll over the next year. The largest tenants are New York City Economic Development (28.4% of net rentable area [NRA]) and the NYS Superintendent of Insurance (12.6%). The year-end 2015 servicer reported debt service coverage ratio (DSCR) was 1.54x. This loan is scheduled to mature in July 2017.

The next largest loan in the pool is secured by a 518,000 sf portion of the Crystal Mall (8.1% of the pool), a two-story enclosed regional mall located in Waterford, CT. Per the servicer, the YTD September 2015 DSCR and collateral occupancy were 1.70x and 88.5%, respectively. There are four anchors at the property, two of which, Macy's and Sear's, are not part of the collateral. The third anchor, JC Penney (17% of the collateral NRA), renewed its lease last year through 2019; and Bed Bath & Beyond/Christmas Tree Shops (12.7%) has a lease through 2024. Approximately 18% of the collateral square footage (12% of total mall sf) rolls over the next year. Annualized in-line (less than 10,000 sf) comparable sales for 2015 were reported at $357 psf, which is in line with the 2014 average.

RATING SENSITIVITIES

Rating Outlooks for all classes remain Stable due to the overall stable performance of the pool. Upgrades, while not likely in the near term, are possible with increased credit enhancement and sustained improvement to the pool's credit metrics. No loans are scheduled to mature until July 2017 (12.1%); and only 16.3% of the pool prior to 2022.Downgrades to the classes are possible should overall performance decline.

DUE DILIGENCE USAGE

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

Fitch affirms the following classes as indicated:

--$5.7 million class A-1 at 'AAAsf'; Outlook Stable;

--$174.8 million class A-2 at 'AAAsf'; Outlook Stable;

--$116.3 million class A-3 at 'AAAsf'; Outlook Stable;

--$479.7 million class A-4 at 'AAAsf'; Outlook Stable;

--$94.2 million class A-S-EC at 'AAAsf'; Outlook Stable;

--$63.8 million class B-EC at 'AAsf'; Outlook Stable;

--$45.6 million class C-EC at 'Asf'; Outlook Stable;

--$203.7 class EC at 'Asf'; Outlook Stable;

--$24.3 million class D at 'BBB+sf'; Outlook Stable;

--$47.1 million class E at 'BBB-sf'; Outlook Stable;

--$22.8 million class F at 'BBsf'; Outlook Stable;

--$24.3 million class G at 'Bsf'; Outlook Stable;

--*Class X-A at 'AAAsf', Outlook Stable.

*Interest-Only class.

The class A-S-EC, class B-EC and class C-EC certificates may be exchanged for class EC certificates, and class EC certificates may be exchanged for class A-S-EC, class B-EC and class C-EC certificates. As of the June 2013 remittance, all of the class A-S-EC, class B-EC and class C-EC certificates had been exchanged for class EC certificates.

Fitch does not rate the interest-only class X-B or class H certificates.

Additional information is available at www.fitchratings.com.

Applicable Criteria

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

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

Criteria for Rating Caps and Limitations in Global Structured Finance Transactions (pub. 28 May 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748781

Global Structured Finance Rating Criteria (pub. 06 Jul 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952

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

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

Related Research

UBS-Barclays Commercial Mortgage Trust 2012-C2 -- Appendix

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=684226

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1003621

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1003621

Endorsement Policy

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

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