[February 13, 2012] Fitch Affirms 'AAA' Classes of Bear Stearns 2007-TOP26 Tweet Feb 13, 2012 (Close-Up Media via COMTEX) -- Fitch Ratings has affirmed the 'AAA' classes and downgraded 10 classes of Bear Stearns Commercial Mortgage Securities Trust (BSCMS) Series 2007-TOP26. A detailed list of rating actions follows at the end of this press release. The downgrades reflect an increase in Fitch modeled losses across the pool and greater certainty of losses associated with specially serviced assets. Fitch modeled losses of 8.9 percent of the original pool (includes losses realized to date) based on updated cashflows and valuations of specially serviced loans. There are currently eight specially serviced loans (4.2 percent) in the pool. As of the January 2012 distribution date, the pool's aggregate principal balance was reduced to $1.85 billion from $2.11 billion at issuance. There are no defeased loans. There are cumulative interest shortfalls in the amount of $2.1 million currently affecting classes F through P. Fitch has identified 46 loans (20.8 percent) as Fitch Loans of Concern, which includes eight specially serviced loans (4.2 percent). The largest contributor to Fitch modeled losses is a loan (3.0 percent) secured by a 479,913 square foot (sf) office property located in Phoenix, AZ. The loan was transferred back to the master servicer in August 2011 after being modified in May 2011. The modification terms wrote down the principal balance by $9 million to $56 million. As of the September 2011 rent roll the property is 55.2 percent occupied which declined from 77.5 percent due to Viad Corp. significantly reducing the amount of space occupied in the building. Leases representing 12 percent of NRA expire through YE2012. The second largest contributor to Fitch modeled losses is a loan (2.6 percent) secured by a 210,186 sf office property located in Tacoma, WA. The investment grade single tenant moved its headquarters to Seattle and vacated the property in 2010. The tenant is obligated to make rental payments through November 2013; however, efforts to sublease the property have not been successful to date. A cash flow sweep was be triggered in December 2011, which has collected $580,020 to cover costs associated with re-leasing the property. The third largest contributor to Fitch modeled losses is a loan (1.7 percent) secured by a 260,467 sf office property located in Atlanta, GA. Occupancy as of the October 2011 rent roll is 70.3 percent which declined from 75.7 percent as of June 2010. The loss associated with this property is due to reduced cashflow from declining occupancy and rent concessions. Fitch downgrades the following classes and assigns Recovery Estimates (RE) as indicated: --$160.6 million class A-J to 'BB' from 'BBB-sf'; to Outlook Negative from Stable; --$42.1 million class B to 'CCCsf' from 'Bsf'; RE 65 percent; --$18.4 million class C to 'CCCsf' from 'B-sf'; RE 0 percent; --$29 million class D to 'CCsf' from 'CCCsf'; RE 0 percent; --$15.8 million class E to 'CCsf' from 'CCCsf'; RE 0 percent; --$18.4 million class F to 'CCsf' from 'CCCsf'; RE 0 percent; --$18.4 million class G 'to 'Csf' from 'CCCsf'; RE 0 percent; --$18.4 million class H to 'Csf' from 'CCsf'; RE 0 percent; --$2.6 million class J to 'Csf' from 'CCsf'; RE 0 percent; --$2.6 million class K to 'Csf' from 'CCsf' RE 0 percent. In addition, Fitch affirms the following classes and revises Outlooks as indicated: --$49 million class A-2 at 'AAAsf'; Outlook Stable; --$65.4 million class A-3 at 'AAAsf'; Outlook Stable; --$78 million class A-AB at 'AAAsf'; Outlook Stable; --$991.9 million class A-4 at 'AAAsf'; Outlook Stable; --$122.7 million class A-1A at 'AAAsf'; Outlook Stable; --$210.6 million class A-M at 'AAAsf'; Outlook to Negative from Stable. Classes L, M, N, and O remain at 'Dsf'; RE 0 percent. Fitch does not rate class P. Class A-1 has been paid in full. Fitch previously withdrew the ratings assigned to the interest-only classes, X-1 and X-2. For additional information, see 'Fitch Revises Practice for Rating IO & Pre-Payment Related Structured Finance Securities, dated June 23, 2010.) Additional information on Fitch's criteria for analyzing U.S. CMBS transactions is available in the Dec. 21, 2011 report, 'Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions', which is available at 'fitchratings.com' under the following headers: Structured Finance then CMBS then Criteria Reports Additional information is available at 'fitchratings.com'. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings. Applicable Criteria and Related Research: --'Global Structured Finance Rating Criteria' (Aug. 4, 2011); --'Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions' (Dec. 21, 2011). Applicable Criteria and Related Research: Global Structured Finance Rating Criteria http://fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=646569 Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions http://fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=662869 ((Comments on this story may be sent to [email protected])) [ Back To TMCnet.com's Homepage ]