NEW YORK--(BUSINESS WIRE)--Fitch Ratings has affirmed 20 classes of ML-CFC Commercial Mortgage Trust, series 2007-9 (ML-CFC 2007-9), commercial mortgage pass-through certificates. A detailed list of rating actions follows at the end of this press release.
KEY RATING DRIVERS
The affirmations represent overall stable performance of the transaction since the last rating action. Fitch modeled losses of 18.9% of the remaining pool; expected losses on the original pool balance total 16.6%, including $110.9 million (3.9% of the original pool balance) in realized losses to date. Fitch has designated 96 loans (58.2% of the pool) as Fitch Loans of Concern, which includes 21 specially serviced assets (17.7% of the pool).
As of the December 2013 distribution date, the pool's aggregate principal balance has been reduced by 32.8% to $1.89 billion from $2.81 billion at issuance. Per the servicer reporting, three loans (0.6% of the pool) are defeased. Interest shortfalls are currently affecting classes F through T.
The largest contributor to expected losses is the specially-serviced DLJ West Coast Hotel Portfolio loan (4.3% of the pool). The loan was transferred to special servicing in May 2009 due to imminent default. The loan was initially secured by six cross-collateralized and cross-defaulted hotel properties totaling 1,159 rooms located in California and Oregon. The hotels operated under the Residence Inn, Hawthorne Suites, Courtyard Marriot, and Hilton Garden Inn flags. To date, five of the six properties have been sold. A sale date for remaining property has not been determined.
The second largest contributor to expected losses is the specially-serviced St. Louis Flex Office Portfolio loan (2.7% of the pool). The loan was transferred to special servicing in November 2010 for imminent default due to cash flow issues. The asset consists of a portfolio of six industrial/flex properties totaling 864,540 square feet located in the St. Louis, Missouri metropolitan statistical area (MSA). All six properties became real-estate owned in May 2012. The special servicer has been pursuing a lease-up strategy and will evaluate the market and property performance before listing for sale.
The third largest contributor to expected losses is the specially-serviced Morgan 7 RV Park Portfolio loan (1.9% of the pool). The loan was transferred to special servicing in October 2011 for delinquent payments. The loan is secured by a portfolio of seven RV parks (totaling 1,586 RV sites) of various vintages ranging from 1960-1990 located on a total of 306 acres in Maine, Michigan, New Jersey and New York. Two of the three Maine properties were foreclosed on in March 2013, the third in June 2013 and the Michigan property was foreclosed in April 2013. Receivers have been appointed on the remaining New York and New Jersey properties.
Rating Outlooks on classes A-2, A-3, A-SB, and A-4 remain Stable due to sufficient credit enhancement and continued paydown. Negative Outlooks on classes AM and AM-A are due to volatility surrounding values and future losses on the specially serviced assets. In addition, various loans within the top 15 have stressed loan to values (LTVs) in excess of 100%, which can impact a loan's ability to refinance at maturity, and four of the top 15 are in special servicing.
Fitch affirms the following classes as indicated:
--$37 million class A-2 at 'AAAsf', Outlook Stable;
--$134.8 million class A-3 at 'AAAsf', Outlook Stable;
--$67.6 million class A-SB at 'AAAsf', Outlook Stable;
--$931 million class A-4 at 'AAAsf', Outlook Stable;
--$210 million class AM at 'BBBsf', Outlook Negative;
--$56.8 million class AM-A at 'BBBsf', Outlook Negative;
--$168 million class AJ at 'CCCsf', RE 65%;
--$56.8 million class AJ-A at 'CCCsf', RE 65%;
--$31.6 million class B at 'CCsf', RE 0%;
--$21.1 million class C at 'CCsf', RE 0%;
--$28.1 million class D at 'Csf', RE 0%;
--$24.6 million class E at 'Csf', RE 0%;
--$24.6 million class F at 'Csf', RE 0%;
--$28.1 million class G at 'Csf', RE 0%;
--$28.1 million class H at 'Csf', RE 0%;
--$24.6 million class J at 'Csf', RE 0%;
--$15.6 million class K at 'Dsf', RE 0%;
--$0 class L at 'Dsf', RE 0%;
--$0 class M at 'Dsf', RE 0%;
--$0 class N at 'Dsf', RE 0%.
The class A-1 and A-1A certificates have paid in full. Fitch does not rate the class P, Q, S and T certificates. Fitch previously withdrew the ratings on the interest-only class XP and XC certificates.
Additional information on Fitch's criteria for analyzing U.S. CMBS transactions is available in the Dec. 18, 2012 report, 'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria', which is available at 'www.fitchratings.com' under the following headers:
Structured Finance then CMBS then Criteria Reports
Additional information is available at 'www.fitchratings.com'.
Applicable Criteria and Related Research:
--'Global Structured Finance Rating Criteria' (May 24, 2013);
--'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria' (Dec. 18, 2012).
Applicable Criteria and Related Research:
Global Structured Finance Rating Criteria
U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria