Fitch Upgrades 1 Class of DLJCM 1999-CG3

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has upgraded one and affirmed five classes of DLJ Commercial Mortgage Corporation commercial mortgage pass-through certificates series 1999-CG3. A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

The upgrade is due to high credit enhancement (CE), despite the concentrated nature of the pool. There are only four loans remaining, including one defeased loan (30% of the pool) and one specially serviced loan (10.9%). Fitch modeled losses of 6.7% of the remaining pool; expected losses on the original pool balance total 5.3%, including $46.8 million (5.2% of the original pool balance) in realized losses to date.

As of the March 2015 distribution date, the pool's aggregate principal balance has been reduced by 98.7% to $11.8 million from $899.3 million at issuance. Interest shortfalls are currently affecting classes B-5 through D.

The specially-serviced loan is the Whitfield Village Apartments, which is secured by four 2-story and one 1-story building that consists of 48, 2-bedroom/2-bathroom, Class C, multifamily units located in Sarasota, FL (55 miles south of Tampa). The loan transferred to special servicing in March 2012 for monetary default. Prior to the trust taking the property into receivership in March 2013, the borrower filed for Chapter 11 bankruptcy. Per the most recent property inspection dated July 2014, the property was found to be in good condition with the primary deferred maintenance items being the deteriorated parking lot and drainage system. The property is 88% occupied as of January 2015. The most recent debt-service coverage ratio (DSCR) as of year-end (YE) 2014 was 1.03x.

The loan was modified effective Jan. 1, 2015 and modification terms include an interest rate reduction to 5.25% from 8.58%, extension of the maturity to Dec. 1, 2024 from July 1, 2019; and prepayment allowed in whole or in part on any payment date without penalty. The loan is expected to be returned to the master servicer after the receipt of three timely payments and all outstanding items have been cleared.

RATING SENSITIVITIES

The Rating Outlook on class B-4 remains Stable due to increasing CE and continued paydown. Although CE is high and a significant amount of the class is covered by defeasance, upgrades are not likely as the defeased loan does not mature until 2023 and the remaining pool is concentrated. All of the remaining loans are multifamily loans with maturities in 2023, 2024 and 2028.

Fitch upgrades the following class as indicated:

--$4.6 million class B-4 to 'BBsf' from 'Bsf'; Outlook Stable.

Fitch affirms the following classes as indicated:

--$7.2 million class B-5 at 'Dsf'; RE 90%;

--$0 class B-6 at 'Dsf'; RE 0%;

--$0 class B-7 at 'Dsf'; RE 0%;

--$0 class B-8 at 'Dsf'; RE 0%;

--$0 class C at 'Dsf'; RE 0%.

The class A-1A, A-1B, A-1C, A-2, A-3, A-4, A-5, B-1, B-2 and B-3 certificates have paid in full. Fitch does not rate the class D certificates. Fitch previously withdrew the rating on the interest-only class S certificates.

Additional information on Fitch's criteria for analyzing U.S. CMBS transactions is available in the Dec. 10, 2014 report, 'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria', which is available at 'www.fitchratings.com' under the following headers:

Structured Finance >> CMBS >> Criteria Reports

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

Applicable Criteria and Related Research:

--'Global Structured Finance Rating Criteria' (March 31, 2015);

--'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria' (Dec. 10, 2014).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=864268

U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=812608

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=982442

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.

Fitch Ratings
Primary Analyst
Lisa Cook
Director
+1-212-908-0665
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Committee Chairperson
Mary MacNeill
Managing Director
+1-212-908-0785
or
Media Relations
Sandro Scenga, New York, +1-212-908-0278
[email protected]

Source: Fitch Ratings

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