Fitch Downgrades 1 Class of CSFB 1999-C1

CHICAGO--(BUSINESS WIRE)-- Fitch Ratings has downgraded one class and affirmed three classes of Credit Suisse First Boston Mortgage Securities Corp. (CSFB) commercial mortgage pass-through certificates series 1999-C1. A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

The downgrade to class G reflects the possibility of losses from the one specially serviced asset, which may be significant given the low occupancy of the property and the special servicer's value-add strategy. Only two other loans remain, both of which are defeased with maturity dates March 2019. Although class G is fully covered by the defeased collateral, Fitch remains concerned about the ultimate recovery of the specially serviced asset given significant expenses incurred and likely expenses required to implement the value-add strategy.

As of the April 2016 distribution date, the pool's aggregate principal balance has been reduced by 97.6% to $28.2 million from $1.17 billion at issuance. There has been $82.7 million (7.1% of the original pool balance) in realized losses to date. Interest shortfalls are currently affecting classes H through O.

The specially-serviced loan (24.7%) is secured by a 129,293 square foot office building located in Parsippany, NJ. The loan transferred to the special servicer in June 2013 due to imminent default, primarily the result of vacancy issues. The property's largest tenant (52% of GLA) vacated in December 2013. Foreclosure has been completed and the property became real estate owned (REO) in August 2015. Current occupancy is approximately 16% as of April 2016. The special servicer has no current disposition plans and is implementing a value-add strategy.

RATING SENSITIVITIES

The Rating Outlook on class G has been revised to Negative from Stable due to the prolonged value-add strategy and likely expenses pertaining to the specially serviced asset. A further downgrade may be possible if the asset suffers a worse than anticipated recovery. A future upgrade will be unlikely given the risk of losses and interest shortfalls with the current asset disposition plan of the REO asset; should the asset be disposed prior to incurring any shortfalls to class G the class would be upgraded.

DUE DILIGENCE USAGE

No third party due diligence was provided or reviewed in relation to this rating action.

Fitch has downgraded the following class and revised the Rating Outlook as indicated:

--$20.2 million class G to 'BBsf' from 'BBBsf'; Outlook to Negative from Stable.

Fitch has affirmed the following classes and revises the RE as indicated:

--$8 million class H at 'Dsf'; RE 0%.

Fitch has affirmed following classes:

--$0 class J at 'Dsf'; RE 0%;

--$0 class K at 'Dsf', RE 0%.

The class A-1, A-2, B, C, D, E and F certificates have paid in full. Fitch does not rate the class L, M and O certificates. Fitch previously withdrew the rating on the interest-only class A-X and N certificates.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Counterparty Criteria for Structured Finance and Covered Bonds (pub. 14 May 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158

Criteria for Rating Caps and Limitations in Global Structured Finance Transactions (pub. 28 May 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748781

Global Structured Finance Rating Criteria (pub. 06 Jul 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952

U.S. and Canadian Fixed-Rate Multiborrower CMBS Surveillance and U.S. Re-REMIC Criteria (pub. 13 Nov 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=873395

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1004368

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1004368

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160512005809/en/

Fitch Ratings
Primary Analyst
Daniel Anderson
Associate Director
+1-312-606-2305
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Committee Chairperson
Mary MacNeill
Managing Director
+1-212-908-0785
or
Media Relations:
Sandro Scenga, +1 212-908-0278
[email protected]

Source: Fitch Ratings

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