Fitch Upgrades 1 Class of Wachovia 2005-C22

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has upgraded one and affirmed 11 classes of Wachovia Bank Commercial Mortgage Trust, 2005-C22 commercial mortgage pass-through certificates. A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

The upgrade is the result of increasing credit enhancement from continued paydown and further certainty regarding losses on the specially serviced loans. Since the last rating action, 122 loans paid in full including six specially serviced loans with better than expected recoveries. There are seven loans remaining, of which six (65%) are in Special Servicing and one (35%) is on the Servicer's Watch List.

Expected losses on the original pool balance total 9.7%, including $228 million (9% of the original pool balance) in realized losses to date. As of the February 2016 distribution date, the pool's aggregate principal balance has been reduced by 97.2% to $70 million from $2.53 billion at issuance. Interest shortfalls are currently affecting classes E through Q.

The largest contributor to expected losses is One Riverfront Plaza (23%), an office building totaling 130,726 sf, located in Westbrook, ME. The loan transferred to special servicing in December due to a maturity default. The borrower has been unable to refinance due to the single tenant vacating in January. The borrower is currently negotiating with a new tenant to occupy the entire building.

The second largest contributor to expected losses is Palmer Town Center (36%), a 153,400 sf retail property (anchored by Home Depot) located in Easton, PA. The collateral excludes the Home Depot 97,895 sf space. The loan reached its anticipated repayment date (ARD) in October 2015. Per the Master Servicer, they are waiting on a response regarding the borrower's payoff intent. The loan's final maturity date is in 2020. The loan's annualized September 2015 debt service coverage ratio (DSCR) was 1.48x and occupancy was 90% as of January 2016.

RATING SENSITIVITIES

Class E will remain at 'Csf' due to expected losses. Once losses are incurred the class will be downgraded to 'D.' Classes F through P have realized losses and will remain at 'D'. Class D is likely to remain at 'CCCsf' as further upgrades are limited by the concentrated nature of the pool and adverse selection. Additionally, the majority of the remaining paydown relies on dispositions of specially serviced loans.

DUE DILIGENCE USAGE

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

Fitch upgrades the following class and revised REs as indicated:

--$22.4 million class D to 'CCCsf' from 'Csf', RE 100%.

Fitch affirms the following classes and revised REs as indicated:

--$47.5 million class E at 'Csf', RE 65%;

--$647 thousand class F at 'Dsf', RE 0%;

--$0 class G at 'Dsf', RE 0%;

--$0 class H at 'Dsf', RE 0%;

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

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

--$0 class L at 'Dsf', RE 0%;

--$0 class M at 'Dsf', RE 0%;

--$0 class N at 'Dsf', RE 0%;

--$0 class O at 'Dsf', RE 0%;

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

The class A-1, A-2, A-3, A-PB, A-4, A-1A, A-M, A-J, B and C certificates have paid in full. Fitch does not rate the class Q certificates. Fitch previously withdrew the rating on the interest-only class IO certificates.

Additional information is available at www.fitchratings.com.

Applicable Criteria

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=1000662

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1000662

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/20160309006122/en/

Fitch Ratings
Primary Analyst
Catherine Barbieri, +1-212-908-0638
Associate Director
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Committee Chairperson
Robert Brook Sutherland, +1-212-908-0638
Senior Director
or
Media Relations, New York
Sandro Scenga, +1-212-908-0278
[email protected]

Source: Fitch Ratings

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