Fitch Takes Various Actions on MSDW 2000-LIFE2

NEW YORK--(BUSINESS WIRE)--Fitch Ratings has downgraded one and upgraded one class of Morgan Stanley Dean Witter Capital I Trust's (MSDW) commercial mortgage pass-through certficates, series 2000-LIFE2. A full list of rating actions follows at the end of this release.

The downgrade reflects an increase in Fitch modeled losses to 14.27% of the remaining pool; modeled losses of the original pool are at 2.27%, including losses already incurred to date. Fitch expects losses from loans currently in special servicing to deplete class N, O, and P and impact class M significantly.

The upgrade is a result of increased credit enhancement due to a pay down of 80% since Fitch's last rating action. As of the June 2011 distribution date, the pool's aggregate principal balance has reduced by 91.8% to $62.8 million from $765.3 million at issuance. Interest shortfalls totaling $1,069,205 are currently affecting classes K through P.

Of the original 103 loans, 13 loans remain outstanding. Fitch has identified 11 loans (47.2%) as Fitch Loans of Concern, which includes 10 specially-serviced loans (56.2%). Of the 10 loans in special servicing, three loans (21.7%) are in foreclosure, four assets (16.4%) are real estate owned (REO), one loan (6.3%) is past maturity and non-performing, and two loans (11.8%) are past maturity and performing.

The largest contributor to modeled losses is a 68,100 square foot (sf) industrial building (5.7%) located in Jacksonville, FL. The loan returned to the master servicer in March 2011 as a modified loan. The loan modification changed the payments from principal and interest to interest only and extended the maturity date until June 2012. The most recent servicer-reported occupancy declined from 83.4% at year end (YE) 2009 to 49.09% as of January 2010.

The second largest contributor to modeled losses is a 60,000 sf office building located in Greece, NY which is a suburb 10 miles northwest of Rochester. The loan was transferred to Special Servicing in July 2010 due to imminent maturity default and was converted to REO in January 2011 via Deed-in-Lieu of foreclosure. The servicer-reported occupancy as of May 2011 was 57% with only one tenant occupying that space.

The third largest contributor to modeled losses is a 66 unit apartment complex located in Eastpointe, MI near Detroit. The loan was transferred to special servicing in September 2009 due to monetary default and was foreclosed on in September 2010. The property has been marketed for sale and the special servicing is reviewing purchase offers.

Fitch stressed the cash flow of the remaining loans by applying a 5% reduction to 2009 or 2010 fiscal year-end (YE) net operating income, and applying an adjusted market cap rate between 8.10% and 11.50% to determine value.

All the loans also underwent a refinance test by applying an 8% interest rate and 30-year amortization schedule based on the stressed cash flow. The current weighted average DSCR is 1.71 times.

Fitch has downgraded and revised Recovery Ratings on the following class:

--$4 million class L to 'C/RR2' from 'CC/RR1'.

Fitch has upgraded the following classes:

--$18.4 million class E to 'AA/LS3' from 'A+/LS3'; Outlook Stable.

Fitch has affirmed the following classes and revised Outlooks, Loss Severity and Recovery Ratings as indicated:

--$7.7 million class F at 'A-'; LS to 'LS3' from 'LS4'; Outlook Stable;

--$3.1 million class G at 'BBB+/LS5'; Outlook Stable;

--$9.6 million class H at 'BBB-'; LS to 'LS3' from 'LS4'; Outlook to Stable from Negative;

--$9.2 million class J at 'CCC/RR1';

--$3.1 million class K at 'CCC'; RR to 'RR2' from 'RR1';

--$6.7 million class M at 'C'; RR to 'RR5' from 'RR4'.

The $1.2 million class N and the zero balance class O remain at 'D/RR6'. Class P, which is not rated by Fitch has been reduced to zero from $5.7 million at issuance due to realized losses. Classes A-1, A-2, B, C, and D have paid in full.

Fitch withdraws the ratings of the interest-only class X. (For additional information, see 'Fitch Revises Practice for Rating IO & Pre-Payment Related Structured Finance Securities', dated June 23, 2010.)

Additional information on Fitch's criteria is available in the Nov. 17, 2010 report 'Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions', which is available at 'www.fitchratings.com' under the following headers:

Structured Finance >> CMBS >> Criteria Reports

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'Global Structured Finance Rating Criteria' (Aug. 13, 2010);

--'Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions' (Nov. 17, 2010).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=547326

Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=574208

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