Credit Suisse First Boston Mortgage Securities Corp. had three classes of its commercial mortgage pass-through certificates series 2002-CP5 downgraded by Fitch Ratings, while nine classes were affirmed.
The downgrades reflect an increase in Fitch expected losses across the pool. Fitch projected losses of 42.1% of the remaining pool. Meanwhile, expected losses on the original pool totals 6.3%, including $31.5 million (2.7% of the original pool balance) in realized losses to date.
Fitch has designated 17 loans as “loans of concern.” All of these are specially serviced assets, the New York-based ratings agency said.
As of the June 2013 distribution date, the pool’s aggregate principal balance has been reduced by 91.4% to $102.3 million from $1.19 billion at issuance. Additionally, no loans are defeased.
The largest contributor to expected losses is a loan secured by a 241,942-square-foot office property in Greenbelt, Md., that represents 22.9% of the overall pool. This became an REO asset in February 2013 via foreclosure with a takeover occupancy of approximately 65%.
Another major contributor to the pool’s expected losses is a loan affiliated with an 89,751-square-foot office building in Bloomfield, Mich., which made up 9.9% of the pool. The file transferred to special servicing on August 27, 2012 due to the borrower’s inability to refinance the debt prior to maturity on Oct. 1, 2012.
The largest tenant—accounting for 81% of the gross leasable area—for this Michigan asset ended their lease starting on March 31, 2012. But Fitch said the borrower is interested in a maturity extension to resolve this tenancy issue, as the current occupancy of the property is now at 9%.
Fitch said the ratings outlook on classes D through E remain stable due to increasing credit enhancement and continued paydown. But rating outlooks on classes F through H are negative because of the highly concentrated nature of the pool and the number of loans that are in special servicing.
