[May 21, 2013] Fitch Ratings: Affirms GCCFC 2006-FL4 Tweet May 21, 2013 (Close-Up Media via COMTEX) -- Fitch Ratings has affirmed all classes of Greenwich Capital Commercial Funding Corp. (GCCFC), series 2006-FL4. The affirmations reflect the deleveraging of the transaction since the last review. Fitch's performance expectations incorporate prospective views regarding the outlook of the commercial real estate market. A detailed list of rating actions follows below. KEY RATING DRIVERS While credit enhancement to the more senior classes has improved significantly, the transaction faces increased concentration risk with only three loans remaining, all of which are hotel loans that mature in 2014. Under Fitch's methodology, all loans are modeled to default in the base case stress scenario, defined as the 'B' stress. In this scenario, the modeled average cash flow decline is 7 percent and pooled expected losses are 7.2 percent. To determine a sustainable Fitch cash flow and stressed value, Fitch analyzed servicer-reported operating statements and STR reports. Fitch estimates that average recoveries will be strong at approximately 92.8 percent in the base case. All of the original final maturity dates, including all extension options, have passed. Each of the remaining loans has been further extended through a modification and/or forbearance and matures in 2014. Further, all loans have junior debt either inside or outside of the trust. With respect to the pooled classes, two loans were modeled to take a loss in the base case: PGA National Resort and Spa (46.9 percent of the pooled trust balance), and NineZero Hotel (15.3 percent). Six junior non-pooled component classes have all either incurred or are expected to incur losses. The remaining junior non-pooled component classes have paid in full. The PGA National Resort and Spa loan (46.9 percent) is secured by a 339-room full-service resort located in Palm Beach Gardens, FL. The resort is situated on 808 acres and includes five 18-hole golf courses, 19 clay-surface tennis courts, nine food and beverage outlets, 30,000 sf of meeting space, and a 35,500-sf spa. Revenue per available room (RevPAR) as well as servicer reported net operating income (NOI) has improved over last year. NOI remains below that at issuance and Fitch modeled a modest loss on the loan in the base case. The ResortQuest Waikiki Beach loan (37.9 percent) is secured by a leasehold interest in a 644-room full-service hotel located on Waikiki Beach on the Hawaiian island of Oahu. The RevPAR and NOI have both improved since last year. The NOI has recovered significantly from the trough of its performance and is now close to issuance levels. No loss was modeled in the base case. The NineZero Hotel loan (15.2 percent) is secured by a 190-room full-service hotel located in downtown Boston. The RevPAR and NOI have both improved since last year. However, NOI remains below that at issuance and Fitch modeled a loss on the loan in the base case. RATING SENSITIVITIES The ratings are expected to be stable, as the analysis incorporates conservative valuations of the hotels. Upgrades are unlikely as the bonds remain subject to high concentration with only three loans remaining. Fitch affirms the following classes and assigns or revises Recovery Estimates (REs) as indicated: --$12.9 million class A2 at 'AAAsf'; Outlook Stable; --$35.4 million class B at 'AAAsf'; Outlook Stable; --$30.7 million class C at 'AAsf', Outlook Stable; --$18 million class D at 'BBBsf'; Outlook Stable; --$16.7 million class E at 'BBB-sf'; Outlook Stable; --$11.3 million class F at 'BBsf'; Outlook Stable; --$15 million class G at 'CCCsf'; RE 100 percent; --$17.6 million class H at 'CCsf'; RE 70 percent; --$1.8 million class J at 'Dsf'; RE 0 percent; --$0 class K at 'Dsf'; RE 0 percent; --$0 class L at 'Dsf'; RE 0 percent; --$2 million class N-NZH at 'Dsf'; RE 85 percent; --$0 class N-NW at 'Dsf'; RE 0 percent; --$0 class O-NW at 'Dsf'; RE 0 percent; --$0 class P-NW at 'Dsf'; RE 0 percent; --$0 class Q-NW at 'Dsf'; RE 0 percent; --$0 class Q-2600 at 'Dsf'; RE 0 percent. In addition, the following classes originally rated by Fitch have paid in full: A1, N-MET, O-MET, N-LAX, N-SCR, O-SCR, N-PDS, O-PDS, N-WYN, N-HAP, O-HAP, P-HAP, N-CPH, O-CPH, P-CPH, Q-CPH, S-CPH, N-LJS, N-LDC, O-LDC, P-LDC, N-444, O-444, N-E161, N-2600, O-2600, P-2600 and X-1. Applicable Criteria and Related Research: --'Global Structured Finance Rating Criteria' (Jun. 6, 2012); --'Surveillance Criteria for U.S. CREL CDOs and CMBS Large Loan Floating-Rate Transactions' (Nov. 29, 2012). Applicable Criteria and Related Research Surveillance Criteria for U.S. CREL CDOs and CMBS Large Loan Floating-Rate Transactions More Information: www.fitchratings.com http://fitchratings.com/creditdesk/reports/report_frame.cfm rpt_id=695733 http://fitchratings.com/creditdesk/reports/report_frame.cfm rpt_id=679923 http://fitchratings.com/gws/en/disclosure/solicitation pr_id=791243 ((Comments on this story may be sent to [email protected])) [ Back To TMCnet.com's Homepage ]