Fitch Downgrades 1 Distressed Class of WAMU 2006-SL1
NEW YORK -- June 25, 2013
Fitch Ratings has downgraded one class and affirmed 12 classes of WaMu
Commercial Mortgage Securities Trust 2006-SL1, small balance commercial
mortgage pass-through. A detailed list of rating actions follows at the end of
this press release.
KEY RATING DRIVERS
The affirmations are the result of sufficient credit enhancement to the
classes due to scheduled amortization and paydown. The downgrade is due to
principal losses incurred on class G. Fitch modeled losses of 8.7% of the
remaining pool; expected losses on the original pool balance total 9.4%,
including $19.5 million (3.8% of the original pool balance) in realized losses
to date. Fitch has designated 100 loans (30.1%) as Fitch Loans of Concern,
which includes 14 specially serviced assets (4.6%).
As of the May 2013 distribution date, the pool's aggregate principal balance
has been reduced by 36.2% to $326.4 million from $511.4 million at issuance.
No loans are defeased. Interest shortfalls are currently affecting classes G
The largest contributor to expected losses (1.1% of the pool), is currently
specially serviced and secured by a multifamily property consisting of 169
units located in Chicago, IL The property was 84.6% occupied as of January
2011. The special servicer has engaged legal counsel to proceed with the
enforcement of the Lender's rights and ligation remains ongoing. The Lender's
summary judgment motion remains full submitted and the special servicer awaits
the court's decision.
The Rating Outlooks on classes A, A1A, and B remain Negative due to the small
balance nature of the loans and lack of updated operating performance on many
of the loans. Loss severities on smaller balance loans have been higher than
typical CMBS loans. Should additional loans become specially serviced and/or
loss estimates increase further downgrades are possible.
Fitch downgrades the following class:
--$7.3 million class G to 'Dsf' from 'Csf'; RE 0%
Fitch affirms the following classes and assigns or revises REs:
--$39.8 million class A at 'Asf'; Outlook Negative;
--$233.2 million class A1A at 'Asf'; Outlook Negative;
--$10.2 million class B at 'BBsf'; Outlook Negative;
--$14.7 million class C at 'CCCsf'; RE 85%.
--$10.2 million class D at 'CCsf'; RE 0%;
--$7 million class E at 'CCsf'; RE 0%;
--$3.8 million class F at 'Csf'; RE 0%;
--$0 class H at 'Dsf'; RE 0%;
--$0 class J at 'Dsf'; RE 0%;
--$0 class K at 'Dsf'; RE 0%;
--$0 class L at 'Dsf'; RE 0%;
--$0 class M at 'Dsf'; RE 0%.
Fitch does not rate the class N certificates. Fitch previously withdrew the
rating on the interest-only class X certificates.
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'.
Applicable Criteria and Related Research:
--'Global Structured Finance Rating Criteria' (June 24, 2013);
--'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
ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS.
PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK:
HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING
PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND
METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF
CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL,
COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM
THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER
PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS
OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN
EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER
ON THE FITCH WEBSITE.
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
Sandro Scenga, +1-212-908-0278 (New York)
Press spacebar to pause and continue. Press esc to stop.