S ups rtgs on German CMBS Fleet Street Finance 2 Class A nts

Fleet Street Finance Two is a European commercial mortgage backed securities (CMBS) true sale transaction that canadian goose jacket closed in October 2006. It is backed by a single loan secured against a Karstadt sale and leaseback portfolio comprising mostly department stores across Germany. The outstanding loan balance Canada Goose Parka has reduced to EUR660.2 million canada goose black friday sale (from EUR1,192.0 million at closing) as a result of prepayments following property sales, and of quarterly scheduled amortizations. There is a subordinated mezzanine loan outside the transaction. The rights between the issuer and the junior lenders are regulated by an intercreditor agreement.

canada goose coats on sale The key tenant, Karstadt Warenhaus GmbH (Karstadt), filed for insolvency in 2009. Following that, the borrower proposed a restructuring of the transaction. In 2010, the noteholders and mezzanine lenders agreed to this proposal. Key elements of the restructuring plan included extending the loan maturity date to 2014, and the notes legal final maturity date to 2017 on the condition that all the property income and canada goose store sales canada goose uk black friday proceeds uk canada goose are used to service interest and principal on the securitized canada goose uk outlet loan. The restructured transaction includes liquidity support for canada goose clearance sale the class A notes during the extended period after 2014. However, it does Canada Goose Online not include liquidity for the buy canada goose jacket class B, C, or D notes in that period.

Canada Goose sale Our ratings address timely payment of interest under the notes until their legal maturity date (July 2017). They do not address timely payment of the subordinated excess spread, if any, which is now being paid to the noteholders.

canada goose clearance Although we viewed the completion of Karstadt restructuring as a favorable credit factor, we consider that the transaction continues to be significantly exposed to inherent risks within single tenanted portfolios. Absent any new information that could lead us to reconsider our view on the key tenant creditworthiness, we continue to assume that Karstadt may again experience financial difficulties. Our analysis of loan creditworthiness therefore considers our view on the likely level of recoveries that could be available to the issuer following Karstadt insolvency.

canada goose black friday sale THE SECURITIZED LOAN Following https://www.goosefrshop.com the 2010 transaction restructuring, the mezzanine lenders stopped receiving interest and principal on the mezzanine loan. The entire property cash flow Canada Goose Outlet is now used to service and amortize the securitized loan until full repayment.

canada goose deals The securitized loan pays floating rate interest. However, the borrower has entered into interest rate cap arrangements to cover 100% of cheap canada goose uk the securitized loan amount against interest rate fluctuations until loan maturity.

canada goose store Given the loan deleveraging and current low Canada Goose Coats On Sale interest rates, the reported interest coverage ratio has significantly increased to canada goose 6.71x as of April 2012 from 2.39x at closing. Canada Goose online The servicer reports a loan to value ratio of 57.97% as of April 2012, based on an October 2010 valuation.

canada goose coats THE LOAN COLLATERAL The securitized loan is now backed by 52 properties, down from 109 at closing. Most of the remaining properties are department canada goose coats stores across Germany, operated by Karstadt. The top 10 properties account for about 67% of the remaining portfolio by market canada goose homme pas cher value.

canada goose Subsequent to the canada goose factory sale 2010 restructuring, the borrower sold 44 properties (in all, 57 properties have been sold since closing). The sales proceeds were used to amortize the securitized loan.

canada goose clearance sale Most of the sold properties were not what we consider to be core assets. Nonetheless, we note that since the restructuring, the borrower has sold properties at an average price of 98% higher than the 2009 valuation, which was based on the assumption that the properties were fully vacant on sale.

COUNTERPARTY RISK Under our counterparty criteria, the maximum rating achievable for this transaction cannot exceed our long term cheap Canada Goose rating on the issuer liquidity facility provider, Lloyds TSB Bank PLC (A/Stable/A 1).

Canada Goose online RATING ACTIONS Given the loan deleveraging, we consider that the risk of principal losses canada goose clearance has decreased. However, the structure does not provide liquidity support for the class B, C, and D notes during the extended period. Therefore, these classes of notes canada goose uk shop remain exposed to interest shortfalls, in our view. As a consequence, we have affirmed our ratings on these notes at speculative grade levels.

buy canada goose jacket Although the class A notes benefit from liquidity support that seeks to ensure timely payment of interest until 2017, our rating on this class of notes remains constrained at (sf) by our rating on the liquidity facility provider.

Canada Goose Parka Absent liquidity risks and counterparty constrains, all of the notes could have achieved higher ratings.

Canada Goose Jackets POTENTIAL EFFECTS OF PROPOSED CRITERIA CHANGES We have taken today rating Canada Goose Jackets actions based on our criteria for rating European commercial mortgage backed securities (CMBS). However, these criteria are under review (see Notice Of Proposed Criteria Change: Methodology And Assumptions For Rating European Commercial Mortgage Backed Securities, published on Nov. 8, 2011).

buy canada goose jacket cheap As highlighted in canada goose coats on sale the Nov. 8 Advance Notice of Proposed Criteria Change, we expect to publish a request for comment (RFC) outlining our proposed criteria changes for rating European CMBS transactions. Subsequently, we will consider market feedback before publishing our updated criteria. Our review may result uk canada goose outlet in changes to the methodology and assumptions we use when rating European CMBS, and consequently, it may affect Canada Goose sale both new and outstanding ratings on European CMBS transactions.

canadian goose jacket Until such time that we adopt new criteria for rating European CMBS, we will continue to rate and surveil these transactions using our existing criteria (see Criteria And Research

Canada Goose Outlet RELATED CRITERIA AND RESEARCH European CMBS Monthly Bulletin (March 2012): A Quiet Month Ahead Of April EUR2.6 Billion Refinance Challenge, buy canada goose jacket cheap March 29, 2012 (published monthly).



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