Fitch Affirms Opryland Hotel Trust Series 2001-OPRY.Business Editors CHICAGO--(BUSINESS WIRE)--April 29, 2004 Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. affirms Opryland Hotel Trust's commercial mortgage pass-through certificates Pass-Through Certificates (PTCs) are instruments that evidence the ownership of two or more Equipment Trust Certificates. In other words, Equipment Trust Certificates may be bundled into a pass-through structure as a means of diversifying the asset pool and/or increasing the size , series 2001-OPRY, as follows: -- $78.7 million class A-2 'AAA'; -- $18.5 million class B 'AA'; -- $39.3 million class C 'A-'; -- $10 million class E 'BB'. The class A-1 certificates have been paid in full. The $50.7 million class D certificates are not rated by Fitch. The borrower has exercised the first of two one-year extension options resulting in a maturity date of March 31, 2005. Fitch's underwritten net cash flow (NCF See National Cristina Foundation. ), based upon year-end 2003 financial statements, reflects an improvement of 18% from year-end 2002. However, overall NCF remains approximately 30% below issuance levels. The loan benefits from a cash-trap reserve that is employed when the trailing twelve-month (TTM TTM Trailing 12 months. Often used with Earnings Per Share. ) debt service coverage ratio 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 (DSCR DSCR See: Debt-service coverage ratio ) falls below 1.25 times (x). Due to a cash-trap event the borrower paid down the mortgage loan from excess cash flow until the DSCR was equal to 1.25x. As a result of the cash-trap event, the mortgage balance has been reduced by over $54 million. The loan is now performing above the cash-trap requirements. As of the April 2004 distribution date, the transaction balance has been reduced by 28.3% to $197.2 million, which equates to a current loan per room of $68,370. The overall decline in the hotel's performance has been partly mitigated by the partial prepayment of the mortgage loan due to the cash-trap event, the improved NCF compared to year-end 2002, and the mezzanine loan being paid in full. The certificates represent the beneficial ownership interest in the trust, which consists of the fee interest in the 2,883-room full-service Opryland Hotel/Convention Center, located in Nashville, TN. Fitch will continue to monitor this transaction, as surveillance is ongoing. |
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