Fitch Downgrades MSCI 2006-IQ12; Assigns Outlooks

NEW YORK--(Business Wire)--
Fitch Ratings has taken various rating actions on 25 classes of Morgan Stanley
Capital I (MSCI) Trust 2006-IQ12, commercial mortgage pass-through certificates,
including downgrades to 12 classes. In addition, Fitch has assigned Rating
Outlooks and Loss Severity (LS) ratings, as applicable. A detailed list of
rating actions follows at the end of this press release.

The downgrades are the result of Fitch's loss expectations on specially serviced
loans as well as prospective views regarding commercial real estate market value
and cash flow declines. Fitch forecasts potential losses of 7.8% for this
transaction, should market conditions not recover. Today's rating actions are
based on losses of 6.2% including 100% of the losses associated with term
defaults and any losses associated with maturities within the next five years.
Given the significant term to maturity, Fitch's actions only account for 25% of
the losses associated with maturities beyond five years. The bonds with Negative
Outlooks indicate classes that may be downgraded in the future should full
potential losses be realized.

Fitch analyzed the transaction and calculated expected losses by assuming cash
flows on each of the properties decline 15% from year-end (YE) 2007 and property
values decline 35% from issuance. These loss estimates were reviewed in more
detail for loans representing 61.6% of the pool and, in certain cases, revised
based on additional information and/or property characteristics.

Approximately 13.7% of the mortgages are scheduled to mature within the next
five years, of which 12.9% of the pool is maturing in 2011. In 2016, 81% of the
pool is scheduled to mature.

Fitch identified 78 Loans of Concern (24.4%) within the pool, 26 of which
(12.1%) are specially serviced. Three of the specially serviced loans (6.8% of
the pool) are within the transaction's top 15 loans, which comprises 45.8% of
the total pool's unpaid principal balance.

Through its analysis, Fitch determined eight of the top 15 loans (18.4% of the
pool) have a higher probability of defaulting during the term or at maturity,
with loss severities ranging from less than 10% to approximately 75%. Of the top
15 loans, the largest contributors (by loan balance) to expected term losses are
as follows: Westin O'Hare (3.8% of the pool balance), Harbour Centre (1.9%) and
New Horizon Apartments (1.1%). These three loans are in special servicing.

Westin O'Hare is collateralized by a 525 key full-service hotel located in
Rosemont, IL adjacent to Chicago O'Hare International Airport. The loan
transferred to special servicing in June 2009 for imminent default as the
borrower indicated they would no longer fund the debt service shortfalls. The
performance of the hotel has declined significantly from issuance. The trailing
twelve month (TTM) occupancy, average daily rate (ADR) and revenue per available
room (RevPAR) as of July 2009 was 61.2%, $126 and $77, respectively, compared to
71%, $185 and $131, respectively at issuance. The annualized June 2009 servicer
reported debt service coverage ratio (DSCR) was 0.48 times (x) compared to 1.46x
at issuance.

Harbour Centre is secured by a 217,056 square foot (sf) office building located
in Aventura, FL. The loan transferred to special servicing in April 2009 for
imminent payment default. The borrower is seeking to modify the loan as the
property has lost tenants since issuance with a recent reported occupancy as of
June 2009 of approximately 70%, compared to 90% at issuance. Approximately 28%
of the leases are scheduled to expire prior to YE 2011. The annualized June 2009
servicer-reported DSCR was 1.00x on an interest-only basis. The sponsor is
Triple Net Properties, LLC.

New Horizon Apartments (1.1%) is secured by a 912 unit multifamily property
located in Memphis, TN. The property is real estate owned (REO) and is
approximately 25% occupied as of August 2009 compared to 86.5% at issuance.
Fitch expects significant losses upon disposition of this asset based on recent
valuations.

Fitch downgrades, removes from Rating Watch Negative, and assigns LS ratings,
Recovery Ratings (RR) and Outlooks to the following classes as indicated:

--$242.3 class A-J to 'BBB/LS3' from 'AAA'; Negative Outlook;

--$17.1 million class B to 'BBB-/LS5' from 'AA+'; Negative Outlook;

--$44.4 million class C to 'BB/LS5' from 'AA'; Negative Outlook;

--$27.3 million class D to 'BB/LS5' from 'A+'; Negative Outlook;

--$13.7 million class E to 'BB/LS5' from 'A'; Negative Outlook;

--$23.9 million class F to 'B/LS5' from 'A-'; Negative Outlook;

--$23.9 million class G to 'B-/LS5' from 'BBB+'; Negative Outlook;

--$27.3 million class H to 'B-/LS5' from 'BBB'; Negative Outlook;

--$27.3 million class J to 'CCC/RR6' from 'BB+';

--$34.1 million class K to 'CC/RR6' from 'B-';

--$3.4 million class L to 'C/RR6' from 'CCC/RR2';

--$6.8 million class M to 'C/RR6' from 'CC/RR4'.

Fitch affirms the following class:

--$13.7 million class N at 'C/RR6'.

Additionally, Fitch affirms the following classes and Outlooks and assigns LS
ratings as indicated:

--$32.6 million class A-1 at 'AAA/LS1'; Outlook Stable;

--$511.5 million class A-1A at 'AAA/LS1'; Outlook Stable;

--$70.2 million class A-2 at 'AAA/LS1'; Outlook Stable;

--$225 million class A-NM at 'AAA/LS1'; Outlook Stable;

--$44.5 million class A-3 at 'AAA/LS1'; Outlook Stable;

--$88.2 million class A-AB at 'AAA/LS1'; Outlook Stable;

--$897.6 million class A-4 at 'AAA/LS1'; Outlook Stable;

--$173 million class A-M at 'AAA/LS3'; Outlook Stable;

--$100 million class A-MFL at 'AAA/LS3'; Outlook Stable;

--Interest-only class X-1 at 'AAA'; Outlook Stable;

--Interest-only class X-2 at 'AAA'; Outlook Stable;

--Interest-only class X-W at 'AAA'; Outlook Stable.

The $3.4 million class O, $6.8 million class P, $10.2 million class Q and $20.4
million class S are not rated by Fitch.

Additional information on Fitch's amended criteria for analyzing recent vintage
U.S. CMBS is available in the July 8, 2009 report, 'Surveillance Methodology for
Recent Vintage U.S. CMBS,' which is available at www.fitchratings.com under the
following headers:

Structured Finance >> CMBS >> Criteria Reports

Fitch will release a report titled 'Morgan Stanley Capital I Trust 2006-IQ12'
that will contain a graph of revised loss expectations for the transaction at
'www.fitchratings.com' under the following headers:

Structured Finance >> CMBS >> Special Reports

Additional information is available at www.fitchratings.com.

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
DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S
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 Ratings
Jeffrey Diliberto, +1-212-908-9173
Adam Fox, +1-212-908-0869
Sandro Scenga, +1-212-908-0278 (Media Relations)
sandro.scenga@fitchratings.com

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