Fitch Affirms BSCMSI 2004-PWR5

CHICAGO--()--Fitch Ratings has affirmed all classes of Bear Stearns Commercial Mortgage Securities Trust (BSCMSI) commercial mortgage pass-through certificates series 2004-PWR5 as a result of stable performance since issuance. A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

Fitch modeled losses of 3.1% of the remaining pool; expected losses on the original pool balance total 2.9%, including $13.6 million (1.1% of the original pool balance) in realized losses to date. Fitch has designated 30 loans (16%) as Fitch Loans of Concern, which does not include any specially serviced loans.

As of the January 2014 distribution date, the pool's aggregate principal balance has been reduced by 44% to $691.3 million from $1.23 billion at issuance. Per the servicer reporting, 11 loans (31.8% of the pool) are defeased. Interest shortfalls are currently affecting class Q; 84 loans or 88.8% of the pool matures in 2014.

The three largest contributors to expected losses represent approximately 70% of total modeled losses.

The largest contributor to expected losses is the Bald Hill Plaza loan (1.6% of the pool), which is secured by a 128,840 square foot (sf) retail property located in Warwick, RI. The loan is current through the January 2014 remittance date. Net operating income (NOI) has dropped 34% since origination. The servicer -reported NOI debt service coverage ratio (DSCR) has decreased to 0.84x as of third quarter 2013, down from 0.86x at YE 2012, and from 1.24x at origination. The property's occupancy is reported at 91%, down from 99% at origination. Tenants maturing in 2014 represent 13% of the property. The loan matures in July 2014.

The next largest contributor to expected losses is the Centerpointe Tech Center loan (1%), which is secured by a 152,679 sf flex office property located in San Diego, CA. The loan was assumed by a new Sponsor in June 2012 and performance has improved with occupancy increasing from 45% at YE 2012 to 68% through third quarter 2013. The servicer reported NOI DSCR is improving from 0.10x at YE 2012 to 0.70x through third quarter 2013. The loan matures in July 2014.

The third largest contributor to expected losses is the largest loan in the pool, 2941 Fairview Park Drive loan (9.4%), which is secured by a 352,583 sf office property in Falls Church, VA. The property is current through the January remittance. The YE 2012 servicer-reported DSCR is 1.20x, down from 1.58x at origination. Occupancy at YE 2012 was 85%, in line with the 87% occupancy at origination. General Dynamics (rated 'A' by Fitch) occupies 48% with a lease expiring in March 2019. No other tenant occupies more than 10% of the net rentable area.

RATING SENSITIVITY

Rating Outlooks on classes A-5, B, as well as classes D through H are Stable due to increasing credit enhancement and continued paydown. The Rating Outlook on Class C is Positive. Should payoffs occur as expected, upgrade could be possible for this class.

Fitch affirms the following classes and assigns or revises REs as indicated:

--$4.6 million class J at 'CCCsf', RE 100%;
--$4.6 million class K at 'CCCsf', RE 50%.

Fitch affirms the following classes as indicated, and revises Outlooks as indicated:

--$547.5 million class A-5 at 'AAAsf', Outlook Stable;
--$29.3 million class B at 'AAAsf', Outlook Stable;
--$9.3 million class C at 'AAsf', Outlook Positive;
--$20 million class D at 'AAsf', Outlook Stable;
--$13.9 million class E at 'Asf', Outlook Stable;
--$15.4 million class F at 'BBB+sf', Outlook Stable;
--$9.3 million class G at 'BBBsf', Outlook Stable;
--$18.5 million class H at 'Bsf', Outlook Stable;
--$6.2 million class L at 'CCsf', RE 0%;
--$4.6 million class M at 'CCsf', RE 0%;
--$4.6 million class N at 'CCsf', RE 0%;
--$3.1 million class P at 'Csf', RE 0%.

Fitch does not rate the class Q certificates. Fitch previously withdrew the ratings on the interest-only class X-1 and X-2 certificates.

Additional information on Fitch's criteria for analyzing U.S. CMBS transactions is available in the Dec. 11, 2013 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 >> CMBS >> 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:
U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=724961
Global Structured Finance Rating Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=708661

Additional Disclosure
Solicitation Status
http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=818190
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Contacts

Fitch Ratings
Primary Analyst
Valerie Jayson, +1-312-368-3116
Associate Director
Fitch Ratings, Inc.
70 W Madison Street
Chicago, IL 60602
or
Committee Chairperson
Mary MacNeill, +1-212-908-0785
Managing Director
or
Media Relations
Sandro Scenga, +1-212-908-0278 (New York)
sandro.scenga@fitchratings.com

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Contacts

Fitch Ratings
Primary Analyst
Valerie Jayson, +1-312-368-3116
Associate Director
Fitch Ratings, Inc.
70 W Madison Street
Chicago, IL 60602
or
Committee Chairperson
Mary MacNeill, +1-212-908-0785
Managing Director
or
Media Relations
Sandro Scenga, +1-212-908-0278 (New York)
sandro.scenga@fitchratings.com