February 01, 2013 at 17:09 PM EST
Fitch Downgrades 6 Classes of BSCMT 2006-TOP24

Fitch Ratings has downgraded six classes and affirmed 12 classes of Bear Stearns Commercial Mortgage Securities Trust commercial mortgage pass-through certificates, series 2006-TOP24 (BSCMT 2006-TOP24). A detailed list of rating actions follows at the end of this press release.

SENSITIVITY/RATING DRIVERS

The downgrades are primarily the result of higher than expected losses on the Real Estate Owned (REO) $52.9 million Hilton Tapatio. The asset, which had been REO since August 2010, was sold in January 2013 for just under $21 million. While Fitch anticipated the low sale price, recoveries to the trust ($5.1 million) were lower than expected; related fees and expenses totaled $15.8 million which were not fully reported to Fitch at the last review by the special servicer, C-III Asset Management LLC.

The downgrade to class A-J and the Negative Rating Outlook on the A-M classes reflect the reduced credit enhancement and the thinness of the remaining classes.

Based on the portfolio as of the January 2013 distribution date, Fitch's modeled losses are 5.9% of the remaining pool; expected losses on the original pool balance total 10.6%, including losses already incurred to date. Fitch has designated 37 loans (18.4%) as Fitch Loans of Concern, which includes six loans (4.1%) currently in special servicing.

Fitch downgrades the following classes and assigns Recovery Estimates (REs) as indicated:

--$101.7 million class A-J to 'CCCsf' from 'BBB-sf', RE 90%;

--$28.8 million class B to 'Csf' from 'CCCsf', RE 0%;

--$13.4 million class C to 'Csf' from 'CCsf', RE 0%;

--$0.7 million class E to 'Dsf' from 'Csf', RE 0%;

--$0 class F to 'Dsf' from 'Csf', RE 0%;

--$0 class G to 'Dsf' from 'Csf', RE 0%.

Fitch affirms the following classes as indicated:

--$33.9 million class A-3 at 'AAAsf'; Outlook Stable;

--$64.9 million class A-AB at 'AAAsf'; Outlook Stable;

--$715.3 million class A-4 at 'AAAsf'; Outlook Stable;

--$153.5 million class A-M at 'Asf'; Outlook Negative;

--$21.1 million class D at 'Csf'; 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%.

Classes A-1 and A-2 have paid in full. Classes X-1 and X-2 were previously withdrawn and Class P is not rated.

Additional information on Fitch's criteria for analyzing U.S. CMBS transactions is available in the Dec. 18, 2012 report, 'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria', which is available at 'www.fitchratings.com' under the following headers:

Structured Finance >> CMBS >> Criteria Reports

Additional information is available at 'www.fitchratings.com'. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.

Applicable Criteria and Related Research:

--'Global Structured Finance Rating Criteria' (June 6, 2012);

--'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria' (Dec. 18, 2012).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=679923

U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=696969

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.

Contacts:

Fitch Ratings
Primary Analyst
Scarlett Shao
Associate Director
+1-212-908-9169
Fitch, Inc.
One State Street Plaza
New York, NY 10004
or
Committee Chairperson
Mary MacNeill
Managing Director
+1-212-908-0785
or
Media Relations:
Sandro Scenga, +1-212-908-0278
sandro.scenga@fitchratings.com
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