Fitch Downgrades ML-CFC Commercial Mortgage Trust 2006-1; Assigns Outlooks

CHICAGO--(Business Wire)--
Fitch Ratings has downgraded and removed from Rating Watch Negative 14 classes,
and assigns Rating Outlooks to all rated classes of commercial mortgage
pass-through certificates from ML-CFC Commercial Mortgage Trust, series 2006-1.
A detailed list of rating actions follows at the end of this press release.

The downgrades are the result of loss expectations and reflect Fitch's
prospective views regarding commercial real estate market value and cash flow
declines. Fitch forecasts potential losses of 4.2% for this transaction, should
market conditions not recover. Today's rating actions are based on losses of
3.5%, 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 53.5% of the pool and, in certain cases, revised
based on additional information and/or property characteristics. Approximately
70.6% of the losses were on loans reviewed in detail. Approximately 73.5% of the
recognized losses were from loans reviewed in detail.

Approximately 26.6% of the mortgages mature within the next five years as
follows: 8.3% in 2010, 8.1% in 2011, 8.6% in 2012, 0.8% in 2013, and 0.8% in
2014. In 2016, 67.2% of the pool is scheduled to mature. Three (21.1%) of the
largest 15 loans are scheduled to mature before 2012.

Fitch identified 25 Loans of Concern (19.9%) within the pool, 10 of which (5.4%)
are specially serviced. Of the specially serviced loans, one (0.5% of the pool)
is current. Three of the Fitch Loans of Concern (10.6%) are within the
transaction's top 15 loans, and one (2%) is specially serviced.

Losses are expected on seven of the loans within the top 15: two (4%) of these
loans are expected to default during the term, while losses on the remaining
five loans (8.5%) are expected at maturity. Loss severities associated with
these loans range from approximately 5% to 40%. The largest contributors to loss
are as follows: Inglewood Park (2%), U-Store-It Portfolio (1%), and Prince
George Center II (2%).

The Inglewood Park loan is collateralized by a seven-building office/industrial
park located in Largo, Maryland totaling 536,197 square foot (sf). The property
was transferred to the Special Servicer May 10, 2009 due to payment default. In
January 2007, the property was purchased for $69 million and the $43 million
loan was assumed by the current borrower. Property occupancy recently dropped to
44% following the loss of several large tenants. Workout discussions with the
special servicer are in progress.

The U-Store-It Portfolio loan is collateralized by four properties, containing
194,241 sf of self-storage space and 56,455 sf of commercial/warehouse space.
The loan was transferred to the special servicer on June 3, 2009. The properties
are all located in the Chicago, IL metropolitan statistical area (MSA). The
single tenant occupying the warehouse space vacated at the expiration of its
lease term (Dec. 31, 2008). Current occupancy is approximately 66% (as of July
6, 2009). Workout discussions with the special servicer are in progress.

The Prince George Center II loan is collateralized by an office building located
in Hyattsville, MD, totaling 394,578 sf. Occupancy is currently 100%. The
property has been 99.5% occupied since issuance by the U.S. Treasury Department
under a 20-year lease with the General Services Administration (GSA) (expiring
2012). This issuer-reported year end (YE) 2008 debt service coverage ratio
(DSCR) was 0.94 times (x) (compared to 1.24x at issuance). The utilities expense
at the property increased by 40% as local deregulation recently ended. The GSA
tenant needs to approve any utility pass-back, which has resulted in the
decreased DSCR. Fitch's analysis resulted in a higher probability of default
during the loan term due to the pending maturity of the major tenant and the
recent decline in cash flow.

Fitch downgrades, removes from Rating Watch Negative, and assigns Loss Severity
(LS) ratings and Outlooks to the following classes:

--$82.1 million class A-J to 'AA/LS3' from 'AAA'; Outlook Negative;

--$100 million class AN-FL to 'AA/LS3' from 'AAA'; Outlook Negative;

--$50.9 million class B to 'A/LS4' from 'AA'; Outlook Negative;

--$21.4 million class C to 'BBB/LS5' from 'AA-'; Outlook Negative;

--$29.5 million class D to 'BBB-/LS5' from 'A'; Outlook Negative;

--$16.1 million class E to 'BB/LS5' from 'A-'; Outlook Negative;

--$24.1 million class F to 'BB/LS5' from 'BBB'; Outlook Negative;

--$16.1 million class G to 'B/LS5' from 'BBB-'; Outlook Negative;

--$26.8 million class H to 'B-/LS5' from 'BB+'; Outlook Negative;

--$5.4 million class J to 'B-/LS5' from 'BB'; Outlook Negative;

--$5.4 million class K to 'B-/LS5' from 'BB-'; Outlook Negative;

--$8 million class L to 'CCC/RR6' from 'B+';

--$2.7 million class M to 'CCC/RR6' from 'B';

--$8 million class N to 'CCC/RR6' from 'B-'.

Fitch affirms and revises the Recovery Rating for the following class:

--$5.4 million class P affirmed at 'CCC/RR6' (revised from 'CCC/RR1').

Fitch also affirms the following classes and assigns LS ratings and Outlooks:

--$20.3 million class A-1 at 'AAA/LS1'; Outlook Stable;

--$337.5 million class A-2 at 'AAA/LS1'; Outlook Stable;

--$66.2 million class A-3 at 'AAA/LS1'; Outlook Stable;

--$105.2 million class A-3FL at 'AAA/LS1'; Outlook Stable;

--$75 million class A-3B at 'AAA/LS1'; Outlook Stable;

--$121 million class A-SB at 'AAA/LS1'; Outlook Stable;

--$489.5 million class A-4 at 'AAA/LS1'; Outlook Stable;

--$229.8 million class A-1A at 'AAA/LS1'; Outlook Stable;

--$214.2 million class A-M at 'AAA/LS3'; Outlook Stable;

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

Fitch does not rate the $26.8 million class Q.

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 then CMBS then Criteria Reports

Fitch will release a report titled 'ML-CFC Commercial Mortgage Trust 2006-1'
that will contain a graph of revised loss expectations for the transaction at
'www.fitchratings.com' under the following headers:

Structured Finance then CMBS then 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, Chicago
Ryan Frank, 312-368-3133
Britt Johnson, 312-606-2341
or
Media Relations:
Sandro Scenga, 212-908-0278, New York
Email: sandro.scenga@fitchratings.com

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