Fitch Upgrades 3 Classes GMAC 1998-C2.
--$19 million class H to 'BBB-' from 'BB+';
--$19 million class J to 'BB+' from 'BB-';
--$19 million class K to 'BB-' from 'B+'.
In addition, Fitch affirms the following classes:
--$1.2 billion class A-2 at 'AAA';
--Interest Only (IO) class X at 'AAA';
--$126.5 million class B at 'AAA';
--$113.9 million class C at 'AAA';
--$164.5 million class D at 'AAA';
--$38 million class E at 'AAA';
--$88.6 million class F at 'AA-';
--$44.3 million class G at 'BBB+;
--$25.3 million class L at 'B-'.
Fitch affirms the $17.6 million class M at 'CC'. However, the distressed recovery rating has been lowered to 'DR5' from 'DR4' due to a decrease in recoveries.
Class A-1 has paid in full. Class N, which is not rated by Fitch, was reduced to zero due to losses.
The upgrades are a result of defeasance and an increase subordination levels due to additional loan amortization and prepayments since Fitch's last rating action. A total of 74 loans (29.0%) have defeased since issuance. As of the November 2006 distribution date, the transaction's principal balance decreased 24.4% to $1.91 billion compared to $2.53 billion at issuance.
Fitch expects losses on the three specially serviced loans (0.6%) to significantly impact the principal balance of class M. The largest of these loans (0.2%) is an REO asset secured by a 467-pad mobile home property in Saginaw, MI. The special servicer is working with the property manager to improve the site for marketability.
Fitch reviewed operating statement analysis reports and other performance information provided by the master servicer. The Fitch stressed debt service coverage ratio (DSCR) for the loan is calculated based on a Fitch adjusted net cash flow (NCF) and a stressed debt service based on the current loan balance and a hypothetical mortgage constant.
Five credit assessed loans (27.5%) are in the pool. One loan, the Arden Realty Inc. loan (6.7%), is defeased.
The OPERS Factory Outlet Portfolio (9.2%) is secured by 12 cross-collateralized and cross defaulted outlet properties within nine centers. Occupancy as of September 2006 was 92%, a 4.9% decrease from 96.7% at issuance. The year-end (YE) 2005 Fitch stressed debt service coverage ratio (DSCR) was 2.50 times (x) compared to 1.68x at issuance. The loan maintains an investment grade credit assessment.
The two remaining investment grade credit assessed loans, South Towne Center & Marketplace (3.4%) and Grove Property Trust (3.3%), have performed at or better than expected at issuance. The loans maintain investment grade credit assessments.
The Boykin Portfolio (5%) remains below investment grade.
Fitch's Distressed Recovery (DR) ratings, introduced in April 2006 across all sectors of structured finance, are designed to estimate recoveries on a forward-looking basis while taking into account the time value of money. For more information on Distressed Recovery ratings, see the full report ('Structured Finance Distressed Recovery Ratings'), which is available on the Fitch Ratings web site at www.fitchratings.com.
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|Date:||Dec 5, 2006|
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