Fitch Expects Triple-A Ratings for $716m JP Morgan CMBS

Fitch Ratings today released the pre-sale report on the forthcoming JP Morgan Chase Commercial Mortgage Securities Trust 2010-C1. The deal, if priced, would become the second commercial mortgage-backed security (CMBS) issued in 2010 and one of the first since the freeze of the securitization market. The Royal Bank of Scotland issued the first in April 2010. The credit-rating agency expects to assign JP Morgan triple-A status to $608m of class-A certificates. The series JPMCC 2010-C1 certificates are backed by 36 loans secured by 96 commercial properties with an aggregate principal balance of approximately $716.3m. Retail properties represent the highest concentration of the pool at 70.9%. The loans bear an average size of $19.9m. Fitch noted low leverage relative to 2007-2008 conduit transactions. The stressed coverage and loan-to-value (LTV) are 1.37x and 78.2%, respectively. This compares favorably, Fitch said in its pre-sale report, with 1.05x and 110.7% across Fitch-rated conduit transactions in 2007-2008. Midland Loan Services, a wholly owned subsidiary of PNC Bank, will act as servicer. Loan concentration increases the potential impact of event risk on the transaction, Fitch said. The largest single loan in the pool, Gateway Salt Lake, represents 14.1% of the total pool. The largest 10 loans account for 55.1% of the pool, and the top 15 make up 68.5%. JP Morgan Chase Bank and Ladder Capital Finance originated the loans, according to Fitch. A JP Morgan spokesperson did not return an e-mailed request for comment before this story was published. Write to Diana Golobay.

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