Fitch Downgrades 3 Distressed Classes of WBCMT 2007-WHALE 8

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has downgraded 3 classes and affirmed three classes of Wachovia Bank Commercial Mortgage Trust (WBCMT) series 2007-WHALE 8. A detailed list of rating actions follows at the end of this release.

KEY RATING DRIVERS

The downgrades reflect losses incurred to the classes as a result of recovered advances on the remaining loan in the pool. Wells Fargo, the Master Servicer for the transaction, has deemed the advances on the $58.4 million Four Seasons Nevis loan as non-recoverable and has clawed back previously advanced funds from trust proceeds. The recovery of advances has led to realized losses to classes H, J, K, and L.

The $51 million pooled loan and $7.4 million non-pooled subordinate loan which secures the rake bonds (FSN-1 and FSN-2) are the only remaining loans in the trust. The servicer had advanced $45.3 million including $29.7 million towards repairs & operations, $6.3 million for taxes & insurance, $2.1 million advanced for principal & interest, and $7.1 million for interest on advances. As reflected in the May 2015 remittance, the servicer has recovered the total $45.3 million in advances by clawing back the funds from proceeds received by the trust from the full payoff of the $133 million Longhouse Hospitality Pool loans, which paid off as of the May 2015 distribution. As a result, classes E, F, G, and the related rake bonds (LP-1, LP-2, and LP-3) received $87.9 million in principal proceeds. The remaining $45.3 million was used to repay servicer advances and was reflected as a realized loss to the H through L pooled classes.

The collateral consists of a 196-key hotel located in Charlestown, Nevis. The hotel, which was built in 1991, is the largest full-service luxury resort on the island of Nevis in the West Indies. The property sits on 346 acres and provides amenities such as a private beach, swimming pools, food and beverage outlets, flexible meeting and ballroom space, tennis courts, an 18-hole golf course, and health club facilities.

The property suffered hurricane damage and was subsequently closed in October 2008. The special servicer foreclosed on the property in May 2010. The property has since been repaired and re-opened for business in December 2010. As of trailing 12-month (TTM) January 2015, occupancy reported at 48.4%, ADR at $608, and RevPAR at $294.50. Net operating income for TTM September 2014 reported in line with year-end 2013 at approximately $2.76 million, after several years of negative operations during the property's closure and rehabilitation. The property is currently being marketed for sale.

RATING SENSITIVITIESTo determine a Fitch stressed value on the Four Seasons Nevis, Fitch analyzed servicer-reported operating statements (year end 2014), Smith Travel Research (STR) reports, and updated property valuations. The current rating on class G also incorporates the risk for foreign sovereign exposure, and limits its rating to below investment grade (below 'BBB-sf').

Additional information regarding sovereign risk and structured bonds can found in Fitch's 'Criteria for Sovereign Risk in Developed Markets for Structured Finance and Covered Bonds', published Feb. 20, 2015.

Fitch downgrades the following classes:-- $12.1 million class H to 'Dsf' from 'CCsf'; RE 35%;-- $0 class J to 'Dsf' from 'Csf'; RE 0%;-- $0 class K to 'Dsf' from 'Csf'; RE 0%;

Fitch affirms the following classes:-- $38.9 million class G at 'Bsf'; Outlook Stable;-- $0 class L at 'Dsf'; RE 0%;-- $3.3 million class FSN-1 at 'Csf'; RE 0%.

The pooled A-1, A-2, B, C, D, E, F and the interest only X-1A classes have paid in full. Fitch previously withdrew the rating on the interest only X-1B class. In addition the non-pooled LXR-1, LXR-2, AP-1, AP-2, FA, HH-1, MH-1, LP-1, LP-2, and LP-3 rake classes have paid in full. Fitch does not rate the non-pooled AP-3, AP-4, HH-2, FSN-2, and MH-2 rake classes.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:--'Global Structured Finance Rating Criteria' (March 31, 2015);--'Criteria for Analyzing Large Loans in U.S. Commercial Mortgage Transaction' (March 20, 2015);--'Criteria for Sovereign Risk in Developed Markets for Structured Finance and Covered Bonds' (Feb. 20, 2015);--'Criteria for Rating Caps and Limitations in Global Structured Finance Transactions' (May 28, 2014).

Applicable Criteria and Related Research:Criteria for Rating Caps and Limitations in Global Structured Finance Transactionshttp://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=748781Criteria for Sovereign Risk in Developed Markets for Structured Finance and Covered Bondshttp://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=862115Criteria for Analyzing Large Loans in U.S. Commercial Mortgage Transactionshttp://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=862818Global Structured Finance Rating Criteriahttp://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=864268

Additional DisclosureSolicitation Statushttp://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=985180ALL 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/20150521006557/en/

Fitch Ratings
Primary Analyst
Benson Thomas, +1-212-908-0645
Director
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Committee Chairperson
Mary MacNeill, +1-212-908-0785
Managing Director
or
Media Relations
Sandro Scenga, New York, +1 212-908-0278
[email protected]

Source: Fitch Ratings

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