Fitch Upgrades 1 Class of MSDW 2002-IQ2
NEW YORK -- March 13, 2014
Fitch Ratings has upgraded one and affirmed seven classes of Morgan Stanley
Dean Witter Capital I Trust commercial mortgage pass through certificates,
series 2002-IQ2. A detailed list of rating actions follows at the end of this
KEY RATING DRIVERS
The upgrade and affirmations are due to sufficient credit enhancement to the
remaining Fitch rated classes. Despite high credit enhancement and minimal
expected losses, upgrades were limited given the concentrated nature of the
pool. Expected losses on the original pool balance total 0.8%, including $4.6
million (0.6% of the original pool balance) in realized losses to date.
As of the February 2014 distribution date, the pool's aggregate principal
balance has been reduced by 95% to $38.9 million from $778.6 million at
issuance. There are 16 loans remaining in the pool, all of which are
performing and with the master servicer. The largest loan represents 52% of
the pool balance; the top three loans (67.5%) are amortizing on a 25-year
schedule with the remaining loans fully amortizing.
The largest loan is a retail center in Knoxville, TN anchored by Kohl's (22%,
exp. 2019), KVAT Food Stores (14.7%, exp. July 2018), Steinmart (10%, exp.
November 2017 and Bed, Bath and Beyond (10%, exp. 2023). The loan is currently
100% occupied and matures in 2019.
There are several single tenant property concentrations in the remaining pool,
with 9 loans being occupied by a single tenant. The second largest loan (8.5%
of the pool) is occupied by two tenants, Winn-Dixie and a Wendy's Restaurant.
The third largest loan (7.2%) is an 80,000 square foot (sf) single-tenant
industrial property located in San Diego, CA. The loan has a stable NOI DSCR
of 1.91x as of Year End (YE) 2012. However, the tenant has extended their
lease only a year to June 2015 from the previous June 2014 expiration.
Additionally, there are three single tenant Rite-Aid loans (7.8%) and three
single tenant Winn-Dixie loans (2.1%).
The ratings are expected to remain stable due to the concentrations within the
Fitch upgrades the following class:
--$3.9 million class K to 'BBBsf' from 'BBB-sf', Outlook Stable.
Fitch affirms the following classes:
--$657,052 class F at 'AAAsf', Outlook Stable;
--$5.8 million class G at 'AAAsf', Outlook Stable;
--$9.7 million class H at 'AAsf', Outlook Stable;
--$5.8 million class J at 'Asf', Outlook Stable;
--$3.9 million class L at 'B+sf', Outlook Stable;
--$2.9 million class M at 'Bsf', Outlook Stable;
--$2.9 million class N at 'CCCsf', RE 100%.
The class A-1, A-2, A-3, A-4, B, C, D, and E certificates and the
interest-only class X-2 certificates have paid in full. Fitch does not rate
the class O certificates. Fitch previously withdrew the rating on the
interest-only class X-1 certificates.
Additional information on Fitch's criteria for analyzing U.S. CMBS
transactions is available in the Dec. 11, 2013 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' (May 24, 2013);
--'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria'
(Dec. 11, 2013).
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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