Moody's affirms 12 CMBS classes of GSMST 2011-GC5

New York, August 17, 2012 -- Moody's Investors Service (Moody's) affirmed the ratings of 12 classes of GS Mortgage Securities Trust 2011-GC5, Commercial Mortgage Pass-Through Certificates, Series 2011-GC5 as follows:

Cl. A-1, Affirmed at Aaa (sf); previously on Oct 13, 2011 Definitive Rating Assigned Aaa (sf)

Cl. A-2, Affirmed at Aaa (sf); previously on Oct 13, 2011 Definitive Rating Assigned Aaa (sf)

Cl. A-3, Affirmed at Aaa (sf); previously on Oct 13, 2011 Definitive Rating Assigned Aaa (sf)

Cl. A-4, Affirmed at Aaa (sf); previously on Oct 13, 2011 Definitive Rating Assigned Aaa (sf)

Cl. A-S, Affirmed at Aaa (sf); previously on Oct 13, 2011 Definitive Rating Assigned Aaa (sf)

Cl. B, Affirmed at Aa3 (sf); previously on Oct 13, 2011 Definitive Rating Assigned Aa3 (sf)

Cl. C, Affirmed at A3 (sf); previously on Oct 13, 2011 Definitive Rating Assigned A3 (sf)

Cl. D, Affirmed at Baa3 (sf); previously on Oct 13, 2011 Definitive Rating Assigned Baa3 (sf)

Cl. E, Affirmed at Ba3 (sf); previously on Oct 13, 2011 Definitive Rating Assigned Ba3 (sf)

Cl. F, Affirmed at B2 (sf); previously on Oct 13, 2011 Definitive Rating Assigned B2 (sf)

Cl. X-A, Affirmed at Aaa (sf); previously on Oct 13, 2011 Definitive Rating Assigned Aaa (sf)

Cl. X-B, Affirmed at Ba3 (sf); previously on Feb 22, 2012 Downgraded to Ba3 (sf)

RATINGS RATIONALE

The affirmations of the 10 principal and interest bonds are due to key parameters, including Moody's loan to value (LTV) ratio, Moody's stressed DSCR and the Herfindahl Index (Herf), remaining within acceptable ranges. Based on our current base expected loss, the credit enhancement levels for the affirmed classes are sufficient to maintain their current ratings.

The ratings of the two interest-only bonds, Classes X-A and X-B, are consistent with the expected credit performance of their referenced classes and thus are affirmed.

Moody's rating action reflects a cumulative base expected loss of 2.4% of the current balance, which is similar to Moody's loss expectation at securitization. Moody's provides a current list of base expected losses for conduit and fusion CMBS transactions on moodys.com at http://v3.moodys.com/viewresearchdoc.aspx?docid=PBS_SF215255. Depending on the timing of loan payoffs and the severity and timing of losses from specially serviced loans, the credit enhancement level for investment grade classes could decline below the current levels. If future performance materially declines, the expected level of credit enhancement and the priority in the cash flow waterfall may be insufficient for the current ratings of these classes.

Moody's analysis reflects a forward-looking view of the likely range of collateral performance over the medium term. From time to time, Moody's may, if warranted, change these expectations. Performance that falls outside an acceptable range of the key parameters may indicate that the collateral's credit quality is stronger or weaker than Moody's had anticipated during the current review. Even so, deviation from the expected range will not necessarily result in a rating action. There may be mitigating or offsetting factors to an improvement or decline in collateral performance, such as increased subordination levels due to amortization and loan payoffs or a decline in subordination due to realized losses.

Primary sources of assumption uncertainty are the extent of growth in the current macroeconomic environment and commercial real estate property markets. While commercial real estate property values are beginning to move in a positive direction along with a rise in investment activity and stabilization in core property type performance, a consistent upward trend will not be evident until the volume of investment activity steadily increases, distressed properties are cleared from the pipeline, and job creation rebounds. The hotel sector is performing strongly and the multifamily sector continues to show increases in demand. Moderate improvements in the office sector continue with minimal additions to supply. However, office demand is closely tied to employment, where growth remains slow. Performance in the retail sector has been mixed with lackluster sales driven by discounting and promotions. However, rising wages and reduced unemployment, along with increased consumer confidence, is helping to spur consumer spending. Across all property sectors, the availability of debt capital continues to improve with increased securitization activity of commercial real estate loans supported by a monetary policy of low interest rates. Moody's central global macroeconomic scenario reflects healthier growth in the US and US growth decoupling from the recessionary trend in the euro zone, while a mild recession is expected in 2012. Downside risks remain significant, although they have moderated compared to earlier this year. Major downside risks include an increase in the potential magnitude of the euro area recession, the risk of an oil supply shock weighing negatively on consumer purchasing power and home prices, ongoing and policy-induced banking sector deleveraging leading to a tightening of bank lending standards and credit contraction, financial market turmoil continuing to negatively impact consumer and business confidence, persistently high unemployment levels, and weak housing markets, any or all of which will continue to constrain growth.

The methodologies used in this rating were "Moody's Approach to Rating Fusion U.S. CMBS Transactions" published in April 2005, and "Moody's Approach to Rating Structured Finance Interest-Only Securities" published in February 2012. Please see the Credit Policy page on www.moodys.com for a copy of these methodologies.

Moody's review incorporated the use of the excel-based CMBS Conduit Model v 2.61 which is used for both conduit and fusion transactions. Conduit model results at the Aa2 (sf) level are driven by property type, Moody's actual and stressed DSCR, and Moody's property quality grade (which reflects the capitalization rate used by Moody's to estimate Moody's value). Conduit model results at the B2 (sf) level are driven by a paydown analysis based on the individual loan level Moody's LTV ratio. Moody's Herfindahl score (Herf), a measure of loan level diversity, is a primary determinant of pool level diversity and has a greater impact on senior certificates. Other concentrations and correlations may be considered in our analysis. Based on the model pooled credit enhancement levels at Aa2 (sf) and B2 (sf), the remaining conduit classes are either interpolated between these two data points or determined based on a multiple or ratio of either of these two data points. For fusion deals, the credit enhancement for loans with investment-grade credit assessments is melded with the conduit model credit enhancement into an overall model result. Fusion loan credit enhancement is based on the credit assessment of the loan which corresponds to a range of credit enhancement levels. Actual fusion credit enhancement levels are selected based on loan level diversity, pool leverage and other concentrations and correlations within the pool. Negative pooling, or adding credit enhancement at the credit assessment level, is incorporated for loans with similar credit assessments in the same transaction.

The conduit model includes an IO calculator, which uses the following inputs to calculate the proposed IO rating based on the published methodology: original and current bond ratings and credit assessments; original and current bond balances grossed up for losses for all bonds the IO(s) reference(s) within the transaction; and IO type as defined in the published methodology. The calculator then returns a calculated IO rating based on both a target and mid-point. For example, a target rating basis for a Baa3 (sf) rating is a 610 rating factor. The midpoint rating basis for a Baa3 (sf) rating is 775 (i.e. the simple average of a Baa3 (sf) rating factor of 610 and a Ba1 (sf) rating factor of 940). If the calculated IO rating factor is 700, the CMBS IO calculator would provide both a Baa3 (sf) and Ba1 (sf) IO indication for consideration by the rating committee.

Moody's uses a variation of Herf to measure diversity of loan size, where a higher number represents greater diversity. Loan concentration has an important bearing on potential rating volatility, including risk of multiple notch downgrades under adverse circumstances. The credit neutral Herf score is 40. The pool has a Herf of 23, which is the same as at securitization.

Moody's ratings are determined by a committee process that considers both quantitative and qualitative factors. Therefore, the rating outcome may differ from the model output.

The rating action is a result of Moody's on-going surveillance of commercial mortgage backed securities (CMBS) transactions. Moody's monitors transactions on a monthly basis through a review utilizing MOST® (Moody's Surveillance Trends) Reports and a proprietary program that highlights significant credit changes that have occurred in the last month as well as cumulative changes since the last full transaction review. On a periodic basis, Moody's also performs a full transaction review that involves a rating committee and a press release. This is Moody's first full-review since securitization. The initial Pre-Sale Report was released on September 20, 2011. Please see the ratings tab on the issuer / entity page on moodys.com for the last rating action and the ratings history.

DEAL PERFORMANCE

As of the August 10, 2012 distribution date, the transaction's aggregate certificate balance has decreased by 1% to $1.73 billion from $1.75 billion at securitization. The Certificates are collateralized by 74 mortgage loans ranging in size from less than 1% to 11% of the pool, with the top ten loans representing 53% of the pool. Three loans, representing 5% of the pool, have investment grade credit assessments. The pool does not contain any defeased, liquidated or specially serviced loans.

One loan, representing 1% of the pool, is on the master servicer's watchlist. The watchlist includes loans which meet certain portfolio review guidelines established as part of the CRE Finance Council (CREFC) monthly reporting package. As part of our ongoing monitoring of a transaction, Moody's reviews the watchlist to assess which loans have material issues that could impact performance.

Moody's was provided with full year 2010 and full or partial year 2011 operating results for 100% of the conduit, respectively. The conduit portion of the pool excludes the three loans with credit assessments. Moody's weighted average conduit LTV is 92%, which is the same as at securitization. Moody's net cash flow reflects a weighted average haircut of 10% to the most recently available net operating income. Moody's value reflects a weighted average capitalization rate of 9.3%.

Moody's actual and stressed conduit DSCRs are 1.56X and 1.11X, respectively, compared to 1.56X and 1.10X at securitization. Moody's actual DSCR is based on Moody's net cash flow (NCF) and the loan's actual debt service. Moody's stressed DSCR is based on Moody's NCF and a 9.25% stressed rate applied to the loan balance.

The largest loan with a credit assessment is the Museum Square Loan ($58 million -- 3.4% of the pool), which is secured by a 553,000 square foot (SF) class B+ office located in the Miracle Mile submarket of Los Angeles, California. The property was 86% leased as of March 2012 compared to 81% in June 2011. The property's average occupancy over the past five years is 92%. Moody's credit assessment and stressed DSCR are Baa1 and 1.73X, respectively, the same as at securitization.

The other two loans with credit assessments, the ARCT Wal-Mart & Sam's Portfolio Loan and the Alhambra Renaissance Center Loan, each represent less than 1% of the pool. Both have a Baa3 credit assessment, the same as at securitization.

The top three conduit loans represent 29% of the pool balance. The largest conduit loan is the Park Place Mall Loan ($197 million -- 11.4% of the pool), which is secured by the borrower's interest in a 1.06 million SF dominant super-regional mall in Tucson, Arizona. Sears, Dillard's and Macy's anchor the mall and own their own spaces. The largest collateral tenant is an 18-screen movie theatre. March 2012 total mall and in-line occupancy were 97% and 92%, respectively, compared to 97% and 93% in July 2011. In-line sales for the trailing twelve months ending March 2012 were $462 PSF compared to $450 PSF in June 2011. Moody's LTV and stressed DSCR are 94% and 0.97X, respectively, compared to 96% and 0.96X at securitization.

The second largest conduit loan is the 1551 Broadway Loan ($180 million -- 10.4% of the pool), which is secured by a 26,000 SF single tenant retail property and a 15,000 SF LED sign located in the Bow Tie area of Manhattan'sTimes Square district. The property and LED sign are leased to AE Outfitters, Inc. a fully owned subsidiary of American Eagle Outfitters, Inc. through February 2024. The location generated 2010 annual sales of $1,855 per square foot, which is considered very strong. Moody's LTV and stressed DSCR are 90% and 0.93X compared to 88% and 0.96X at securitization.

The third largest conduit loan is the Copper Beech Portfolio Loan ($118 million -- 6.8% of the pool), which is secured by four cross-defaulted and cross-collateralized student housing complexes in Virginia, West Virginia, Texas and Pennsylvania. The collateral consists of 3,052 beds in 1,063 units (2.87 beds per unit on average). The portfolio only contained one vacant unit as of March 2012. The average monthly rent is $1,362 per unit or $475 per bed. Moody's LTV and stressed DSCR are 88% and 1.08X compared to 89% and 1.07X at securitization.

REGULATORY DISCLOSURES

The Global Scale Credit Ratings on this press release that are issued by one of Moody's affiliates outside the EU are endorsed by Moody's Investors Service Ltd., One Canada Square, Canary Wharf, London E 14 5FA, UK, in accordance with Art.4 paragraph 3 of the Regulation (EC) No 1060/2009 on Credit Rating Agencies. Further information on the EU endorsement status and on the Moody's office that has issued a particular Credit Rating is available on www.moodys.com.

For ratings issued on a program, series or category/class of debt, this announcement provides relevant regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides relevant regulatory disclosures in relation to the rating action on the support provider and in relation to each particular rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides relevant regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

Moody's considers the quality of information available on the rated entity, obligation or credit satisfactory for the purposes of issuing a rating.

Moody's adopts all necessary measures so that the information it uses in assigning a rating is of sufficient quality and from sources Moody's considers to be reliable including, when appropriate, independent third-party sources. However, Moody's is not an auditor and cannot in every instance independently verify or validate information received in the rating process.

Please see Moody's Rating Symbols and Definitions on the Rating Process page on www.moodys.com for further information on the meaning of each rating category and the definition of default and recovery.

Please see ratings tab on the issuer/entity page on www.moodys.com for the last rating action and the rating history. The date on which some ratings were first released goes back to a time before Moody's ratings were fully digitized and accurate data may not be available. Consequently, Moody's provides a date that it believes is the most reliable and accurate based on the information that is available to it. Please see the ratings disclosure page on our website www.moodys.com for further information.

Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.

Peter Simon Associate Analyst Structured Finance Group Moody'sInvestors Service, Inc.250 Greenwich StreetNew York, NY 10007 U.S.A. JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653Michael Gerdes MD - Structured Finance Structured Finance Group JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653 Releasing Office: Moody's Investors Service, Inc.250 Greenwich StreetNew York, NY 10007 U.S.A. JOURNALISTS: 212-553-0376 SUBSCRIBERS: 212-553-1653(C) 2012 Moody's Investors Service, Inc. and/or its licensors and affiliates (collectively, "MOODY'S"). All rights reserved.

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