Fitch Ratings has downgraded two classes and removed three classes from Rating Watch Negative of First Union National Bank Commercial (FUNBC) Mortgage Trust's commercial mortgage pass-through certificates, series 2000-C1. A full list of rating actions follows at the end of this release.
The downgrades reflect Fitch modeled losses of 15.82% of the remaining pool; modeled losses of the original pool are at 3.47%, including losses already incurred to date. Fitch has identified four loans (28.1%) as Fitch Loans of Concern, which includes two specially-serviced loans (25%).
Of the original 143 loans, 18 loans remain outstanding. As of the June 2011 distribution date, the pool's aggregate principal balance has reduced by 90.4% to $74.3 million from $776.3 million at issuance. In addition six loans (16.5%) have been fully defeased. Interest shortfalls totaling $2,098,691 are currently affecting classes J through N.
The largest contributor to modeled losses is a specially serviced (10.9%) REO 206,011 square foot (sf) retail center located in Decatur, IL. The loan was transferred to special servicing in January 2010 due to the borrower's request for a discounted payoff. The servicer reported occupancy as of March 2011 was 8% even though the property was 87% leased with two vacant anchor tenant spaces paying rent. The trust took title to the property through Deed in Lieu of Foreclosure in July 2011.
The second largest contributor to modeled losses is a loan (14.1%) secured by an unanchored 70,853 sf retail property located in Chicago, IL, and a block from the Chicago riverwalk. The loan was transferred to Special Servicing in January 2010 due to maturity default. The original maturity date was February 2010 and the borrower was granted a one-year extension but has still been unable to refinance. The special servicer filed a foreclosure complaint in January 2012 and in March 2012 made a determination that future P&I advances are non-recoverable.
Fitch downgrades the following classes as indicated:
--$3.9 million class J to 'BBBsf' from 'A-sf'; Outlook Negative; Removed from Rating Watch Negative.
--$5.8 million class L to 'CCsf' from 'CCCsf'; RE 45%.
Fitch affirms the following classes as indicated:
--$217,062 class E at 'AAAsf'; Outlook Stable;
--$11.6 million class F at 'AAAsf; Outlook Stable;
--$29.1 million class G at 'A+sf'; Outlook Stable;
--$7.8 million class H at 'Asf'; Outlook Negative; Removed from Rating Watch Negative;
--$7.8 million class K at 'B-sf'; Outlook Negative; Removed from Rating Watch Negative.
Class M remains at 'Dsf/RE 0%'. Class N, which is not rated by Fitch has been reduced to zero from $14.6 million at issuance due to realized losses. Classes A-1, A-2, B, C, and D have paid in full.
Fitch has previously withdrawn the ratings of the interest-only class IO. (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 is available in the Dec. 21, 2011 report 'Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions', which is available at 'www.fitchratings.com' under the following headers:
Structured Finance >> CMBS >> Criteria Reports
Additional information is available at 'www.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://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=679923
Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=662869
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