Ten classes of Anthracite 2006-HY3 Ltd./Corp., a commercial real estate collateralized debt obligation, have been downgraded by Fitch Ratings and removed from Rating Watch Negative. The deal is backed primarily by B-pieces of commercial mortgage-backed securities. The downgrades were based on losses and projected losses to the collateral, Fitch said. The rating agency said it believes investment-grade CMBS "will perform well even in a heightened stress environment," but that the risks facing first-loss and junior-rated bonds in CMBS have risen along with expectations of an increase in commercial real estate defaults.
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