DBRS Downgrades Three Classes of COMM 2004-LNB2

DBRS has today downgraded three classes of COMM 2004-LNB2 as follows:

-- Class M to D (sf) from C (sf)
-- Class N to D (sf) from C (sf)
-- Class O to D (sf) from C (sf)

These rating actions reflect the most recent losses to the Trust, resulting from the liquidation of two loans in November 2012. Additionally, as a result of Class M through Class O being downgraded to D (sf), the interest in arrears designations for these classes have been removed. As of the November 2012 remittance report, realized losses for these loans total $16.83 million; to date, seven loans have liquidated from the pool at a cumulative loss of $20.42 million. Additionally, with these liquidations, prior interest shortfalls that had affected Class H through Class O were recovered in full and interest shortfalls affecting Class P were partially recovered.

The 1 Northbrook Corporate Center loan (Prospectus ID#15) was secured by a 95,000 sf office property in Trevose, Pennsylvania. The loan transferred to the special servicer in June 2009 due to imminent payment default. At issuance, the property was valued at $19.2 million and the most recent appraisal, from August 2012, valued the property at $5.5 million. According to the November 2012 remittance report, the property was sold for approximately $6.73 million, resulting in a realized loss to the Trust of $9.22 million and a loss severity of 67.90%.

The Northbrook loan (Prospectus ID#22) was secured by a 66,000 sf office property in Bensalem, Pennsylvania. The loan transferred to the special servicer in June 2009 due to imminent payment default. At issuance, the property was valued at $14.1 million and the most recent appraisal, from August 2012, valued the property at $6.5 million. According to the November 2012 remittance report, the property was sold for approximately $4.68 million, resulting in a realized loss to the Trust of $7.61 million and a loss severity of 74.85%.

DBRS continues to monitor this transaction in its Monthly CMBS Surveillance Report, with additional information on the DBRS viewpoint for this transaction including details on the largest loans in the pool, the loans in special servicing and the loans on the servicer’s watchlist. The November 2012 Monthly Surveillance Report for this transaction will publish shortly. If you are interested in receiving this report, contact us at info@dbrs.com.

Notes:
All figures are in U.S. dollars unless otherwise noted.

This rating is endorsed by DBRS Ratings Limited for use in the European Union.

The applicable methodologies are CMBS Rating Methodology (January 2012) and CMBS North American Surveillance Methodology (November 2012), which can be found on our website under Methodologies.