Fitch Downgrades CRE CDO Classes

Sixty-eight classes in five commercial real estate CDOs from various issuers have been downgraded by Fitch Ratings and removed from Rating Watch Negative. The affected collateralized debt obligations were as follows: 17 classes from ACAS CRE CDO 2007-1 Ltd./LLC; 15 classes from Ansonia CDO 2006-1 Ltd./LLC; 14 classes from JER CRE CDO 2006-2 Ltd./LLC; 12 classes from LNR CDO V series 2007-1 Ltd./LLC; and 10 classes from LNR CDO VI series 2007-2 Ltd./LLC. The deals are backed primarily by B-pieces of commercial mortgage-backed securities, as well as the debt of real estate investment trusts (in the Ansonia deal) and commercial real estate loans (in the JER deal). 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. Fitch can be found online at http://www.fitchratings.com.