Fitch Affirms Bear Stearns Commercial Mortgage Securities Inc., Series 2006-BBA7

CHICAGO--(BUSINESS WIRE)--Fitch Ratings has affirmed all classes of notes for Bear Stearns Commercial Mortgage Securities Inc., commercial mortgage pass-through certificates, series 2006-BBA7, and assigned Rating Outlooks as outlined below:

-- $284.3 million class A-1 'AAA'; Outlook Stable;

-- $128.1 million class A-2 'AAA'; Outlook Stable;

-- Interest only class X-1B 'AAA'; Outlook Stable;

-- Interest only class X-3 'AAA'; Outlook Stable;

-- $30.9 million class B 'AA+'; Outlook Stable;

-- $22.8 million class C 'AA'; Outlook Stable;

-- $21.0 million class D 'AA-'; Outlook Stable;

-- $21.0 million class E 'A+'; Outlook Stable;

-- $20.1 million class F 'A'; Outlook Stable;

-- $36.8 million class G 'A-'; Outlook Stable;

-- $16.6 million class H 'BBB+'; Outlook Stable;

-- $8.8 million class J 'BBB'; Outlook Stable;

-- $9.6 million class K 'BBB-'; Outlook Stable.

Interest-only classes X-1A and X-2 have paid in full.

Affirmations are due to stable performance of the two remaining assets. As of the October 2008 distribution report, the transaction has paid down 14% to $600 million from $700 million. Three of the five original loans have paid in full, and the two remaining loans are collateralized by two portfolios of hotels located in various states.

The Columbia Sussex Portfolio (93.1%), the largest loan in the pool, is collateralized by 14 full-service hotels located in 13 major urban markets with a total of 5,821 rooms. At issuance, the portfolio occupancy was 76% with an average daily rate (ADR) of $131, and revenue per available room (RevPAR) of $99.58. For the year-to-date through September 2008, the portfolio occupancy, ADR, and RevPAR were 65%, $163, and $105.58, respectively. The initial maturity date was Oct. 12, 2007. The loan has three one-year options to extend, and is currently in the second of the one-year extensions with a maturity date of Oct. 12, 2009. As a condition of the extension, the loan was converted from interest-only to amortizing.

The Citigroup Property Investors Hilton Portfolio (6.9%) is secured by five hotels in five different states in distinct markets with a total of 944 rooms. At issuance, occupancy was 72.1%, ADR was $92.9, and RevPAR was $66.97. For the year-to-date through September 2008, the portfolio occupancy, ADR, and RevPAR were 73%, $106, and $77.55, respectively. The initial maturity date was Oct. 12, 2007. The loan has three one-year options to extend, and is currently in the second of the one-year extensions with a maturity date of Oct. 12, 2009. As a condition of the extension, the loan was converted from interest-only to amortizing.

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