Fitch Downgrades Bear Stearns Commercial Mortgage Securities Trust

Fitch Ratings has downgraded 11 classes of Bear Stearns Commercial Mortgage Securities Trust (BSCMSI), 2005-PWR7 commercial mortgage pass-through certificates, due to further deterioration of performance.

While projected losses on loans in special servicing remained fairly consistent relative to the previous review, Fitch-modeled losses across the pool increased due to asset-specific performance issues, evidenced by a 13.4% year-over-year decline in Fitch-adjusted net operating income (NOI) for all non-defeased, non-specially serviced loans in the pool. The year-over-year servicer-reported NOI decline was lower, at 5.6%.

As of the October 2010 distribution date, the pool's aggregate principal balance has been reduced by 10.4% to $1.01 billion from $1.12 billion at issuance, including a pay down of 10.3% and realized losses of 0.1%. Three loans (3.2%) are currently defeased, Fitch notes.

Fitch identified 23 ‘loans of concern’ within the pool, four of which are specially serviced. Six of the Fitch loans of concern are within the transaction's top 15 loans, including two loans that are specially serviced.

SOURCE: Fitch Ratings


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