1st Union/Lehman/BoA CMBS Class Downgraded

Class L of First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust commercial mortgage pass-through certificates, series 1998-C2, has been downgraded from Caa2 to Caa3 by Moody's Investors Service.In addition, Moody's upgraded five classes and affirmed the ratings of seven other classes from the transaction. The downgrade was attributed to realized and expected losses from specially serviced loans. Forty-two loans have been liquidated from the trust, resulting in realized losses of approximately $40.3 million, the rating agency said. Nineteen loans, representing 5.1% of the pool, are in special servicing, and Moody's said it estimates that they will result in losses of approximately $4.7 million. The certificates are collateralized by 527 mortgage loans, consisting of conduit loans (54.5%), defeased loans (21.6%), large loans (16.7%), and credit tenant leases (7.2%). Moody's can be found online at http://www.moodys.com.