Fitch Affirms KeyBank Real Estate Capital's CMBS Servicer Ratings

NEW YORK--(BUSINESS WIRE)-- Fitch Ratings affirms KeyBank Real Estate Capital's (KBREC) commercial mortgage-backed securities (CMBS) servicer ratings as follows:

--Primary servicer rating at 'CPS1';

--Master servicer rating at 'CMS1';

--Special servicer rating at 'CSS2+'.

Each of the ratings incorporates Fitch's long-term Issuer Default Rating for KeyCorp. of 'A-' with a Stable Rating Outlook as of Nov. 18, 2011 and its commitment to commercial mortgage servicing. KBREC employees averaged among the highest training hours of Fitch-rated servicers for the 12 months ending May 2012.

The master and primary servicer ratings reflect Fitch's assessment of the company's servicing experience, commitment to technology, experienced management team, and strong internal control environment. Fitch found that while the master and primary servicing team experienced high turnover of 17% for the 12 months ending May 2012 as a result of its subservicing agreement with Berkadia earlier this year, the average tenure and experience of staff and management remains unchanged.

The special servicer rating reflects the experience and tenure of the company's asset managers, the ability of asset managers to resolve defaulted loans, and presence of policies and procedures to mitigate potential conflicts of interest with third-party clients.

As of June 30, 2012, KBREC's commercial mortgage loan servicing portfolio consisted of 11,181 loans totaling $100.6 billion, of which 7,748 loans totaling $70.7 billion were CMBS. Also as of June 30, 2012, KBREC was named master servicer for 101 CMBS transactions totaling $65.7 billion, and oversaw 24 third-party servicers who serviced 984 loans totaling $11.4 billion. In addition, as of June 30, 2012 KBREC was named special servicer for 26 CMBS transactions totaling $13.9 billion. As of the same date the company was actively specially servicing 90 CMBS loans totaling $110.5 million and was responsible for four CMBS real estate owned (REO) assets totaling $12.5 million.

The servicer rating is based on the methodology described in Fitch's reports 'U.S. Commercial Mortgage Servicer Rating Criteria,' dated Feb. 18, 2011, and 'Global Rating Criteria for Structured Finance Servicers' dated Aug. 16, 2010, available on Fitch's web site 'www.fitchratings.com'.

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:

--'U.S. Commercial Mortgage Servicer Rating Criteria' (Feb. 18, 2011);

--'Global Rating Criteria for Structured Finance Servicers' (Aug. 16, 2010).

Applicable Criteria and Related Research:

Global Rating Criteria for Structured Finance Servicers

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=547305

U.S. Commercial Mortgage Servicer Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=584005

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