277 Park Ave Fin Corp 1997-C1 Cl A-1 Ctfs Upgraded By Fitch.Business Editors & Analysts NEW YORK--(BUSINESS WIRE)--Dec. 21, 2000 277 Park Avenue Finance Corp.'s 1997-C1 $172.5 million class A-1 commercial mortgage pass- through certificates are upgraded to `AA+' from `AA' by Fitch following its annual review. The following classes are affirmed: $85.0 million class A-2 certificates `A', $60.0 million class B-1 certificates `BBB', and $10.0 million class B-2 certificates `BBB-'. The transaction was originally rated in April 1997 and is secured by the 1.75 million square foot, 52-story, multi-tenant, class A commercial office building located at 277 Park Avenue in midtown Manhattan in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , three blocks north of Grand Central Station. The upgrade was due primarily to the principal paydown on the class A-1 certificates to $172.5 million as of the November 2000 distribution date from $190.0 million at origination, a paydown of 9.2%. The paydown is due to the 300-month amortization schedule on the mortgage note. Fitch adjusted net cash flow (`NCF') based on 1999 year-end financial statements, adjusted for replacement reserves, has increased by 0.7% since year-end 1998 and 1.6% since origination. The debt service coverage ratios The debt service coverage ratio (DSCR), or debt service ratio, is the ratio of net operating income to debt payments on a piece of investment real estate. It is a popular benchmark used in the measurement of an income-producing property’s ability to produce based on Fitch adjusted NCF See National Cristina Foundation. , original class balances and the actual mortgage constant of 9.26% for 1999, 1998 and at origination are, respectively, as follows: class A-1, 2.56 times (x), 2.54x, 2.52x; class A-2, 1.77x, 1.76x, 1.74x; class B-1, 1.45x, 1.44x, 1.43x; and class B-2, 1.41x, 1.40x, 1.39x. Based on an 8% capitalization rate Capitalization Rate According to the Appraisal Institute, it is a method used to convert an estimate of a single year's income expectancy into an indication of value in one direct step, by dividing the income estimate by an appropriate rate. on 1999 Fitch NCF, the loan-to-value ratios (LTV's) as of 11/13/00 compared to the LTV's at origination are, respectively, as follows: class A- 1, 30.6%, 36.1%; class A-2, 45.7%, 52.2%; class B-1, 56.4%, 63.6%; and class B-2, 58.2%, 65.5%. The building is currently 99% leased. Donaldson Lufkin & Jenrette, Inc. (DLJ DLJ Distributor License for Java DLJ Donaldson, Lufkin & Jenrette Inc. DLJ Drive Like Jehu (band) DLJ Defence Laboratory Jodhpur (India) DLJ Dead Letter Journal ) currently leases 67% of the property, most of which is due to expire in 2021. Credit Suisse The Credit Suisse Group (SWX:CSGN, NYSE: CS) is a financial services company, headquartered in Zürich, Switzerland. It is the second-largest Swiss bank, behind UBS AG. Group recently acquired DLJ and subsequently, DLJ has offered its space for sublet sub·let tr.v. sub·let, sub·let·ting, sub·lets 1. To rent (property one holds by lease) to another. 2. To subcontract (work). n. . Other major tenants include Sumitomo Bank, Ltd. (170,000 square feet) and Continental Grain Company (112,000 square feet). An average of 1.4% of the leases expires per year through 2009 with any one year's expiration no greater than 3.4%. Fitch will continue to monitor this transaction as surveillance is ongoing. |
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