NEW YORK, September 26 (Fitch) Fitch Ratings has downgraded one class and placed four classes of GMAC Commercial Mortgage Securities, Inc.'s mortgage pass-through certificates, series 2001-C1 on Rating Watch Negative. In addition Fitch has affirmed six distressed classes of the transaction. A detailed list of rating actions follows at the end of this release.
The downgrade of class D to 'A' and placement on Rating Watch Negative is due to the expectation that the class will not receive principal or interest payments for approximately six months. The master servicer will begin withholding principal and interest payments in order to recover an insurance property protection advance made for real estate owned (REO) Bridgewater Place property. Although full recovery of principal and interest is possible, Fitch does not rate classes that have incurred an interest shortfall higher than 'A'.
The placement of classes D through G on Rating Watch Negative is as a result of interest shortfalls, as well as a concern that seven of the remaining eight loans are in special servicing. Fitch will resolve the Rating Watch within the next several months following a detailed review of the transaction after the receipt of updated valuations on the specially serviced loans and additional information on the interest recovery prospects of the classes is received.
Bridgewater Place is an REO office property (19.2% of the pool balance) located in Grand Rapids, MI. The 315,202 square foot (sf) 17 story property was built in 1993 within the central business district (CBD). The servicer-reported occupancy was 61% as of August 2012. Varnum, the largest tenant, renewed their lease earlier this year for a term of 10 years but downsized their footprint by 14,047 sf. The special servicer continues to market the vacant space and recently listed the property for sale. The master servicer had previously ceased advancing principal and interest. The insurance advance is considered a property protection advance.
Fitch has downgraded and placed the following class on Rating Watch Negative:
--$0.8 million class D to 'Asf' from 'AAAsf' The following classes are placed on Rating Watch Negative
--$17.3 million class E 'Asf';
--$13.0 million class F 'BBB-sf';
--$13.0 million class G 'CCCsf'; RE100%. Additionally, Fitch has affirmed the following classes:
--$25.9 million class H at 'Csf'; RE5%;
--$6.5 million class J at 'Csf'; RE0%.
Classes K, L, M and N remain at 'Dsf'; RE0%; due to realized losses.
Class A-1, A-2, A-3, B, C and the interest-only class X-2 have paid in full. Fitch does not rate class P. Class X-1 and O was previously withdrawn.