DBRS Upgrades Seven Classes and Confirms Eight Classes of MSAT 2005-RR4

DBRS has today upgraded the ratings of the following seven classes of Commercial Mortgage-Backed Securities Pass-Through Certificates, Series 2005-RR4, issued by Multiple Security Asset Trust LP, Series 2005-RR4 (MSAT) as follows:

-- Class E to AAA (sf) from AA (sf)
-- Class F to AA (sf) from A (sf)
-- Class G to A (high) (sf) from BBB (high) (sf)
-- Class H to A (low) (sf) from BBB (sf)
-- Class J to BBB (sf) from BB (high) (sf)
-- Class K to BB (high) (sf) from BB (sf)
-- Class L to B (high) (sf) from B (sf)

Additionally, DBRS has confirmed the ratings on the remaining classes in the transaction. All trends are Stable, except for Class M, Class N and Class O, which do not have trends assigned.

The rating upgrades are a result of positive credit migration on the underlying U.S. commercial mortgage-backed securities (CMBS) assets, attributed to amortization, increased defeasance, loan seasoning and increased credit enhancement as a result of successful loan repayments at maturity and recoveries on liquidated loans. This performance has resulted in significant collateral reduction to the MSAT 2005-RR4 capital structure. Since issuance in March 2005, the transaction has amortized by 62.4%, including an additional 8.1% since the last DBRS rating action on all classes in March 2013. Of the 16 original underlying CMBS transactions that were contributing to the MSAT 2005-RR4 transaction, the contributing classes in ten transactions have paid off in full, and five of the remaining six underlying U.S. CMBS transactions are currently experiencing principal repayment.

While potential losses associated with the underlying U.S. CMBS specially serviced loans could reduce credit enhancement or affect the lowest-rated classes, the performance of the overall transaction has been strong. As of the March 2014 remittance report, the transaction has experienced realized losses of approximately $25.5 million; however, losses have been contained to the unrated Class P-3. The MSAT 2005-RR4 capital structure currently has $13.4 million of credit support below the lowest DBRS-rated class. With this surveillance review, DBRS anticipates losses associated with the underlying specially serviced loans to be contained to Class O, which DBRS rates C (sf).

A full report providing additional analytical detail on the contributing underlying U.S. CMBS transactions will be published shortly.

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

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

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