Fitch Upgrades 5 Classes of JPMCC 2004-C1

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has upgraded five and affirmed one class of J.P. Morgan Chase Commercial Mortgage Securities Corp. 2004-C1 (JPMCC 2004-C1) commercial mortgage pass-through certificates. A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

The upgrades are the result of increasing credit enhancement from continued paydown and stable performance of the underlying collateral in the remaining pool.

As of the January 2016 distribution date, the pool's aggregate principal balance has been reduced by 97.5% to $25.8 million from $1.04 billion at issuance. Since the last rating action, two specially serviced loans have liquidated with better than expected recoveries. There are 14 loans remaining in the pool, three of which are defeased (18.9%) and six with fully amortizing terms (30%).

Fitch modeled losses of 15.9% of the remaining pool; expected losses on the original pool balance total 1.5%, including $11.7 million (1.1% of the original pool balance) in realized losses to date. Fitch has designated four loans (33.5%) as Fitch Loans of Concern, which includes two specially serviced assets (21.3%).

The largest contributor to expected losses is the Square Lake Park Office Building (14.3%), a 40,563 square foot (sf) office complex located in Bloomfield Hills, MI. The loan transferred to special servicing in November 2013 due to maturity default. As per the special servicer, the property was foreclosed upon in March 2014.

Since the property became REO, the largest tenant (50.7% of the net rentable area) renewed their lease for an additional five years, which improves the marketing profile of the asset. The property is 96% occupied as of January 2016. The special servicer has indicated that they intend to bring the asset to market in the first quarter of 2016.

The next largest contributor to expected losses is a 15,770 sf office complex located in Lawrenceville, GA (7%). Foreclosure was completed in August 2013. As per the special servicer, the property was 79% occupied as of January 2016 with no new lease prospects. The special servicer has indicated they are exploring leasing possibilities and evaluating the asset to determine a sale strategy.

RATING SENSITIVITIES

The Rating Outlooks on classes J through M are Stable due to increasing credit enhancement and continued paydown. The distressed classes (those rated below 'B') may be subject to further downgrades in the event loan performance deteriorates, as the transaction is becoming increasingly concentrated.

DUE DILIGENCE USAGE

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

Fitch upgrades the following classes and assigns Rating Outlooks as indicated:

--$3.2 million class J to 'AAAsf' from 'Asf'; Outlook Stable;

--$5.2 million class K to 'AAAsf' from 'Asf'; Outlook Stable;

--$3.9 million class L to 'BBBsf' from 'Bsf'; Outlook Stable.

--$5.2 million class M to 'BBsf' from 'CCCsf'; Outlook Stable

--$2.6 million class N to 'CCCsf' from 'CCsf'; RE 100%.

Fitch affirms the following class and revises REs as indicated:

--$2.6 million class P at 'Csf'; RE 75%.

The class A-1, A-2, A-3, A-1A, B, C, D, E, F, G, H and X-2 certificates have paid in full. Fitch does not rate the class NR certificates. Fitch previously withdrew the rating on the interest-only class X-1 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=998996

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=998996

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/20160203006606/en/

Fitch Ratings
Primary Analyst
Catherine Barbieri
Associate Director
+1-212-908-0638
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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