NEW YORK CITY-Fitch Ratings has downgraded seven classes of JP Morgan Chase Commercial Mortgage Corp.’s commercial mortgage pass-through certificates part of series 2005-LDP2. The ratings agency designated 48 loans--or 19.6% of the series--as loans of concern, which include 17 specially-serviced loans.
Adam Fox, senior director in Fitch's US CMBS group, tells GlobeSt.com in an e-mail that the downgrades “were the result of a greater certainty of expected losses.” As of the September 2011 distribution date, the pool’s aggregate principal balance has been reduced by 20.61%, including 2.07% of realized losses, to $2.365 billion from $2.9 billion at issuance, says Fitch.
Fox explained that the largest contributor to the losses was the Cross Creek Shopping Center in Memphis, a 363,000-square-foot property anchored by the Home Depot, Kroger Inc. and Rhodes Furniture.
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The $55.4-million loan was originally sponsored by Amin L. Lahka of Lakha Investments, but the property has since been foreclosed upon, Fox says. The loan was transferred to special servicing by LNR Partners Corp. in January 2010 due to monetary default, and as of October 2010, the property is real estate owned. The property is targeted for a September auction date through Auction.com, according to Fitch.
The second largest contributor to the downgrade is a loan on Ashwood-Southfield, a 334,086-square-foot two-property office portfolio in Atlanta and Southfield, MI, Fox says. The loan is secured by 900 Ashwood Parkway in Atlanta and Southfield Crossing just outside Detroit. The $27.8-million loan was transferred to special servicing by LNR in March 2011 for imminent default, says Fitch. A potential loan restructure is currently being negotiated with the borrower, Kevin A. Shields of Griffin Capital.
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