Fitch Takes Various Rating Actions on BSCMT 2006-TOP24
NEW YORK -- November 20, 2012
Fitch Ratings has downgraded four and affirmed 14 classes of Bear Stearns
Commercial Mortgage Securities Trust commercial mortgage pass-through
certificates, series 2006-TOP24 (BSCMT 2006-TOP24). A detailed list of rating
actions follows at the end of this press release.
The downgrades reflect an increase in Fitch expected losses. Fitch modeled
losses of 8.02% of the original pool balance (including losses incurred to
date). There are currently eight specially serviced loans (8.9%). The Negative
Outlooks reflect the high Fitch loan-to-values (LTVs) on several of the larger
loans in the pool.
As of the November 2012 distribution date, the pool's aggregate principal
balance has been reduced by 22.25% (including 13.59% of realized losses) to
$1.19 billion from $1.53 billion at issuance. One loan (0.51%) is defeased.
Interest shortfalls are affecting classes B through H.
The largest contributor to modeled losses consists of a 585-room full-service
hotel in Phoenix, AZ. The asset, which transferred to special servicing in
October 2009 due to imminent default, was foreclosed upon in August 2010. The
property was marketed for sale, and a purchase and sales agreement was
executed in November 2012.
The next largest contributor to losses consists of a 295-room full-service
hotel located in Schiller Park, IL, within proximity to Chicago O'Hare
Airport. The loan, which was previously performing under a modification,
failed to stabilize, and transferred back to the special servicer on Dec. 15,
2011. Based on the most recent property performance data, performance remains
below expectations from issuance.
The largest loan in the pool, US Bancorp Tower (15.4%), is collateralized by a
1 million square foot class A office building in Portland, OR. The largest
tenant, US Bancorp (rated 'AA-/F1+/OS' by Fitch), occupies over 40% of the net
rentable area under two separate leases expiring in 2015. Property performance
has been stable since issuance. Whereas this loan represents 15% of the
transaction, any declines in future performance will have a significant impact
on overall deal expected losses. Fitch will continue to monitor US Bancorp's
2015 lease expiration, which may affect the loan's ability to refinance at the
August 2016 maturity date.
Fitch takes various rating actions as indicated:
--$41.8 million class A-3 affirmed at 'AAAsf'; Outlook Stable;
--$68.2 million class A-AB affirmed at 'AAAsf'; Outlook Stable;
--$715.3 million class A-4 affirmed at 'AAAsf'; Outlook Stable;
--$153.5 million class A-M downgraded to 'Asf' from 'AAsf'; Outlook to
Negative from Stable;
--$101.7 million class A-J affirmed at 'BBB-sf'; Outlook Negative;
--$28.8 million class B downgraded to 'CCCsf' from 'Bsf'; RE 100%;
--$13.4 million class C downgraded to 'CCsf' from 'CCCsf'; RE 0%;
--$21.1 million class D downgraded to 'Csf' from 'CCsf'; RE 0%;
--$13.4 million class E affirmed at 'Csf'; RE 0%;
--$13.4 million class F affirmed at 'Csf'; RE 0%;
--$19.2 million class G affirmed at 'Csf'; RE 0%;
--$3.5 million class H affirmed at 'Dsf'; RE 0%;
--$0 class J affirmed at 'Dsf'; RE 0%;
--$0 class K affirmed at 'Dsf'; RE 0%;
--$0 class L affirmed at 'Dsf'; RE 0%;
--$0 class M affirmed at 'Dsf'; RE 0%;
--$0 million class N affirmed at 'Dsf'; RE 0%;
--$0 million class O affirmed at 'Dsf'; RE 0%.
Classes A-1 and A-2 have paid in full. Classes X-1 and X-2 were previously
withdrawn and Class P is not rated.
Additional information is available affirmed 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' (June 6, 2012);
--'Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions' (Dec. 21,
Applicable Criteria and Related Research:
Global Structured Finance Rating Criteria
Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions
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Scarlett Shao, +1-212-908-9169
One State Street Plaza
New York, NY 10004
Mary MacNeill, +1-212-908-0785
Sandro Scenga, New York, +1 212-908-0278
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