MBP Retina with Thunderbolt Display Windows 8 VM Issue

Hello,

I have a 2012 15" MBP Retina and a 27" Thunderbolt Display setup that I use at work with the latest version of PD8 and Parallels Tools. I had both monitors working great on my Windows 7 Pro VM basically as an extended desktop. I upgraded the VM to Windows 8 Pro and it works fine on the MBP but as soon as I hook up the Thunderbolt display everything goes to heck. Windows 8 VM screen goes black and the Thunderbolt Display goes black, then linen background, then black, etc. It's almost as though Windows 8 is trying to move the desktop to the external monitor, then back to the MBP, and essentially bouncing back and forth between the two but never actually bringing the desktop up on any. It continues like this until I unplug the Thunderbolt display then everything is fine. Not sure how to get Windows 8 to properly understand that it has the Thunderbolt Display connected. I'm sure I'm not the only one running this type of setup so I must be missing a setting either in Parallels 8 or Windows 8.

Any help would be greatly appreciated.

Thanks.

--SOLVED--

UPDATE:

I don't know how or why but after I reinstalled Parallels Tools and rebooted the VM the second monitor is now working properly.

 

If you have retina resolution enabled for the VM, make sure it's assigned 512Mb of video memory and that DirectX 10 is enabled. Both settings are here: VM Configuration > Hardware > Video.