DBRS Maintains Schooner Trust, Series 2007-8 Under Review with Developing Implications

DBRS, Inc. (DBRS) has today maintained all classes of Commercial Mortgage Pass-Through Certificates issued by Schooner Trust, Series 2007-8 (the Certificates) Under Review with Developing Implications, as listed below:

-- Class A-1 at AAA (sf), Under Review with Developing Implications
-- Class A-2 at AAA (sf), Under Review with Developing Implications
-- Class A-J at AAA (sf), Under Review with Developing Implications
-- Class B at AA (sf), Under Review with Developing Implications
-- Class C at A (sf), Under Review with Developing Implications
-- Class D at BBB (sf), Under Review with Developing Implications
-- Class E at BBB (low) (sf), Under Review with Developing Implications
-- Class F at BB (high) (sf), Under Review with Developing Implications
-- Class G at BB (sf), Under Review with Developing Implications
-- Class H at BB (low) (sf), Under Review with Developing Implications
-- Class J at B (high) (sf), Under Review with Developing Implications
-- Class K at B (sf), Under Review with Developing Implications
-- Class L at B (low) (sf), Under Review with Developing Implications
-- Class XC at AAA (sf), Under Review with Developing Implications

Each class of the Certificates remains Under Review with Developing Implications as DBRS awaits further information regarding the redevelopment plan related to the collateral securing the largest loan in the pool, Londonderry Mall (Prospectus ID#1; 12.0% of the current pool balance). DBRS will continue to monitor the potential cash flow disruptions during the renovation as updates from the servicer on the progress of the plan are made available.

DBRS ran various scenarios to analyze the level of net cash flow decline that could be sustained prior to a potential downgrade of a rated class. The analysis was based on the current loan balance and the YE2013 reporting. Based on the DBRS cash flow sensitivity analysis, DBRS believes that cash flow decline in excess of 20% could be sustained prior to potential rating actions. As the YE2013 reporting is somewhat stale at this point, DBRS expects to re-visit the sensitivity analysis when updated reporting is made available. As many large tenants’ leases expire within the projected redevelopment timeframe, DBRS has requested an update on leasing activity (including renewals and prospective or future tenant commitments) to assess the likelihood of the cash flow decline as well as other factors which may mitigate the property's cash flow volatility during the loan term as the loan is non-recourse.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link to the right under Related Research or by contacting us at info@dbrs.com.

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 (January 2015), which can be found on our website under Methodologies.