Fitch Affirms MSC 2011-C1
NEW YORK -- February 15, 2013
Fitch Ratings has affirmed 11 classes of Morgan Stanley Capital I Trust (MSC)
commercial mortgage pass-through certificates series 2011-C1 due to stable
performance. A detailed list of rating actions follows at the end of this
KEY RATING DRIVERS
Fitch's affirmations are based on the stable performance of the underlying
collateral pool. There have been no delinquent or specially serviced loans
since issuance. The pool has experienced no realized losses to date.
As of the January 2013 distribution date, the pool's aggregate principal
balance has been reduced by 1.9% to $1.52 billion from $1.55 billion at
issuance. No loans have defeased since issuance.
The largest loan in the transaction (15.5%) is secured by a 1.1 million square
foot (sf) (435,219 sf owned) regional mall located in Newark, DE. The mall is
anchored by Macy's, JC Penney, Target, and Nordstrom. Major tenants include
Barnes & Noble (anchor owned), Forever 21 (2.5%) net rentable area (NRA) and
H&M (1.8%) NRA. In-line tenants include Express/Express Men, Anthropologie,
Victoria's Secret, and Urban Outfitters. Total mall occupancy as of Sept. 30,
2012 was 98%, compared to 94% at issuance. The most recent servicer-reported
debt service coverage ratio (DSCR) as of third quarter 2012 was 2.67 times (x)
up from 1.88x at issuance. The loan sponsors are Prime Property Fund and
General Growth Properties.
The second largest loan in the pool (11.5%) is secured by a two-building
office complex consisting of 1.9 million sf located in Chicago, IL. Major
tenants are Blue Cross and Blue Shield Association (12%), lease expiration in
March 2024, Fox Television Studios (5%), lease expiration December 2022, and
Teng & Associates (4%), lease expiration June 2017. There is limited near-term
rollover with 8% rolling in 2013. Additionally, less than 15% rolls annually
through 2020. The property is currently 79% leased, which compares to 73% at
issuance. The most recent servicer-reported DSCR as of third quarter 2012 was
1.99x up from 1.87x at issuance.
The largest Fitch Loan of Concern is the eighth largest loan in the deal
(3.6%) and is secured by a 222,768 sf office building located in the Westwood
section of Los Angeles, CA. The property has seen a decline in occupancy since
issuance. The largest tenants at issuance were Richardson & Patel (10.3%) NRA,
with a lease expiration in October 2011, Castle & Cook (10.2%), lease
expiration July 2015, and The Regency Club (8.2%), lease expiration in June
2011. The most recent servicer-reported occupancy as of September 2012 is 60%
down from 70% at year-end 2011 and 84.2% at issuance. The most recent
servicer-reported DSCR as of September 2012 was 1.04x, down from 1.55x at
issuance. Fitch is awaiting an updated rent roll. Fitch will continue to
closely monitor this loan.
Fitch affirms the following classes:
--$58 million class A-1 at 'AAAsf'; Outlook Stable;
--$597.2 million class A-2 at 'AAAsf'; Outlook Stable;
--$105.1 million class A-3 at 'AAAsf'; Outlook Stable;
--$404.1 million class A-4 at 'AAAsf'; Outlook Stable;
--Interest-only class X-A 'at 'AAAsf'; Outlook Stable;
--$60 million class B at 'AAsf'; Outlook Stable;
--$89 million class C at 'Asf'; Outlook Stable;
--$85.2 million class D at 'BBBsf'; Outlook Stable;
--$19.4 million class E at 'BBB-sf'; Outlook Stable;
--$13.5 million class F at 'BB+sf'; Outlook Stable;
--$15.5 million class G at 'BBsf'; Outlook Stable.
Fitch does not rate the class H, J, K, L, M and interest-only class X-B
Additional information on Fitch's criteria for analyzing U.S. CMBS
transactions is available in the Dec. 18, 2012 report, 'U.S. Fixed-Rate
Multiborrower CMBS Surveillance and Re-REMIC Criteria', 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' (June 6, 2012);
--'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria'
(Dec. 18, 2012).
Applicable Criteria and Related Research:
Global Structured Finance Rating Criteria
U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria
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Alex Benz, +1-212-908-0854
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
Mary MacNeill, +1-212-908-0785
Sandro Scenga, +1-212-908-0278
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