Dec 5 - Fitch Ratings has affirmed the super senior classes and downgraded 7
classes of Credit Suisse Commercial Mortgage Trust, series 2007-C5 commercial
mortgage pass-through certificates. A detailed list of rating actions follows
the end of this press release.
The downgrades are due to realized losses incurred and increased loss
expectations, primarily associated with the specially serviced loans, since
Fitch's last rating action. Fitch expected losses of the original pool are at
20.6%, which includes 5.28% in realized losses to date.
As of the November 2012 distribution date, the pool's certificate balance has
paid down 11.1% to $2.273 billion from $2.720 billion. Fitch identified 73 (59%)
Loans of Concern, including 23 (16.9%) specially serviced. Of the specially
serviced assets, 5 (4.8%) are real estate owned (REO) and 8 (3.8%) are in
foreclosure. There are no defeased loans. In addition, cumulative interest
shortfalls totaling $23.5 million are affecting classes B through S.
The largest contributor to Fitch expected losses is the largest loan (8.42%),
Gulf Coast Town Center Phases I & II. The interest-only loan is secured by a
991,027 sf open-air anchored retail mall located in Fort Myers, FL. The property
has been suffering from poor performance due to lower rents, rent concessions
and increases in expenses. However, most of the rent concessions offered in 2010
and 2011 are due to expire by year-end 2012. The servicer reports that the
property's occupancy and NOI DSCR was 91.3% and 1.00x, respectively, as of June
The second largest contributor to Fitch expected losses is a loan (8.18%)
collateralized by 11 industrial properties with 5.27 million sf. The properties
are located across nine states: Arizona, California, Delaware, Georgia,
Illinois, Kentucky, Tennessee and Texas. The two largest properties, located in
Hebron, KY (Cincinnati MSA) and Memphis, TN account for approximately 58% of the
total square footage of the portfolio. The portfolio's performance over the last
several years still continues to struggle due to the weak local economies
causing increased tenant turnover and vacancy. The portfolio's occupancy dropped
slightly to 88% as of June 2012 from 90% as of year-end 2011. As a result, the
servicer-reported DSCR remained relatively unchanged at 1.05x for the three
months ended March 2012 compared to 1.04x as of YE2011.
The third largest contributor to Fitch expected losses is a mixed portfolio of
five properties located in and around Rochester, NY. The portfolio includes two
multifamily apartment buildings with 568 units, two mixed-use and one industrial
with 441,026 sf. The loan transferred to the special servicer in Dec. 2008 due
to monetary default. Prior to the trust's foreclosure in Nov. 2009, the former
seller filed a lawsuit claiming his signature was forged. The trust's insurance
company is defending against the title claim and a hearing is expected to be
held in Dec. 2012.
Fitch downgrades the following classes and assigns Recovery Estimates (REs) as
--$197.9 million class A-M to 'B-sf' from 'BBsf; Outlook Negative;
--$74.1 million class A-1-AM to 'B-sf' from 'BBsf; Outlook Negative;
--$153.4 million class A-J to 'CCsf' from 'CCCsf'; RE 0%;
--$57.4 million class A-1-AJ to 'CCsf' from 'CCCsf'; RE 0%;
--$23.8 million class B to 'Csf' from 'CCsf'; RE 0%;
--$20.4 million class C to 'Csf' from 'CCsf; RE 0%;
--$34 million class D to 'Csf' from 'CCsf'; RE 0%.
Fitch affirms the following classes and assigns REs as indicated:
--$60.4 million class A-2 at 'AAAsf'; Outlook Stable;
--$161 million class A-3 at 'AAAsf'; Outlook Stable;
--$64 billion class A-AB at 'AAAsf'; Outlook Stable;
--$982.5 million class A-4 at 'AAAsf'; Outlook Stable;
--$333.4 million class A-1-A at 'AAAsf'; Outlook Stable;
--$30.6 million class E at 'Csf'; RE 0%;
--$13.6 million class F at 'Csf'; RE 0%;
--$40.8 million class G at 'Csf'; RE 0%;
--$20.4 million class H at 'Csf'; RE 0%;
--$5.9 million class J at 'Dsf'; RE 0%.
Fitch does not rate classes O, P, Q and S.
Class A-1 has paid in full. Due to realized losses classes K, L, M, and N have
been reduced to zero and remain at 'Dsf/RE 0%'.
Fitch has previously withdrawn the rating on the interest-only classes A-SP and
Additional information on Fitch's criteria is available in the Dec. 21, 2011
report, 'Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions', 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);
--'Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions' (Dec. 21,
Applicable Criteria and Related Research:
Global Structured Finance Rating Criteria
Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions