Fitch Downgrades CWCapital Asset Management LLC's Special Servicer Rating

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has downgraded the commercial mortgage special servicer rating of CWCapital Asset Management LLC (CWCAM) to 'CSS2+' from 'CSS1-'.

The primary driver of the rating change is the second consecutive year of material noncompliance with servicing criterion noted in the company's annual Reg AB audit. In its action, Fitch also considered recent changes to the compliance infrastructure including the formation of a compliance committee to regularly review exception reporting, the depth and scope of the internal audit function, and the strength of its proprietary asset management technology, CAMS.

Fitch's rating also reflects the company's strong asset management capabilities for defaulted/non-performing commercial real estate assets and extensive workout experience, having resolved more than 400 commercial mortgage loans in 2014, its highly experienced management team, and CAMS.

CWCAM is among the three largest CMBS special servicers by unpaid balance and acts as special servicer on behalf of third-party and affiliated controlling class holders and CDO transactions. CWCAM's active special serviced portfolio has declined 51% by loan count and 39% by unpaid principal balance (UPB) over the past two years. CWCAM currently does not invest in CMBS B-pieces and new assignments are dependent on third-party appointments.

As of Dec. 31, 2014, CWCAM was the named special servicer on 7,601 loans in 147 CMBS transactions with a UPB of $109.8 billion. As of the same date, the company was actively working out 239 CMBS loans totaling $5.7 billion and 268 REO assets totaling $7.9 billion. Additionally, the company is named special servicer on 687 non-CMBS loans with a UPB of $3.1 billion and is actively servicing 26 non-CMBS loans with a UPB of $262.7 million and seven REO with a UPB of $113.6 million. At Dec. 31, 2014, approximately 97% of the company's special servicing portfolio was CMBS.

The servicer rating is based on the methodology described in Fitch's reports 'Rating Criteria for U.S. Commercial Mortgage Servicers' dated Feb. 14, 2014, and 'Rating Criteria for Structured Finance Servicers' dated April 23, 2015, available on Fitch's website www.fitchratings.com or by clicking on the links.

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

Applicable Criteria and Related Research:

--'Rating Criteria for U.S. Commercial Mortgage Servicers' (Feb. 14, 2014);

--'Rating Criteria for Structured Finance Servicers' (Apr. 23, 2015).

Applicable Criteria

Rating Criteria for Structured Finance Servicers (pub. 23 Apr 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=864375

Rating Criteria for U.S. Commercial Mortgage Servicers (pub. 14 Feb 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=735382

Additional Disclosures

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=986346

Endorsement Policy

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

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View source version on businesswire.com: http://www.businesswire.com/news/home/20150612005893/en/

Fitch Ratings
Primary Analyst
Howard Miller
Director
+1-212-908-0737
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Lisa Cook
Director
+1-212-908-0665
or
Committee Chairperson
Daniel Chambers
Managing Director
+1-212-908-0782
or
Media Relations:
Sandro Scenga, +1-212-908-0278

Source: Fitch Ratings

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