Approximately $8.7 Million of Notional Structured Securities Affected
New York, June 19, 2018 -- Moody's Investors Service, ("Moody's") has
affirmed the rating on one interest only (IO) class of Wachovia Bank Commercial
Mortgage Trust 2003-C6, Commercial Mortgage Pass-Through
Certificates, Series 2003-C6 as follows:
Cl. IO, Affirmed C (sf); previously on Jun 23,
2017 Affirmed C (sf)
RATINGS RATIONALE
The rating on the IO class was affirmed based on the credit quality of
its referenced classes. The IO class is the only outstanding Moody's
rated class in this transaction.
Moody's rating action reflects a base expected loss of 4.5%
of the current balance, compared to 22.3% at Moody's
last review. Moody's base expected loss plus realized losses is
now 0.8% of the original pooled balance, compared
to 0.9% at the last review. Moody's provides
a current list of base expected losses for conduit and fusion CMBS transactions
on moodys.com at http://www.moodys.com/viewresearchdoc.aspx?docid=PBS_SF215255.
FACTORS THAT WOULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS:
An IO class may be subject to ratings upgrades if there is an improvement
in the credit quality of its referenced classes, subject to the
limits and provisions of the updated IO methodology.
An IO class may be subject to ratings downgrades if there is (i) a decline
in the credit quality of the reference classes and/or (ii) paydowns of
higher quality reference classes, subject to the limits and provisions
of the updated IO methodology.
METHODOLOGY UNDERLYING THE RATING ACTION
The methodologies used in this rating were "Moody's Approach
to Rating Large Loan and Single Asset/Single Borrower CMBS" published
in July 2017 and "Moody's Approach to Rating Structured Finance
Interest-Only (IO) Securities" published in June 2017.
Please see the Rating Methodologies page on www.moodys.com
for a copy of these methodologies.
DEAL PERFORMANCE
As of the May 15, 2018 distribution date, the transaction's
aggregate certificate balance has decreased by 99% to $8.7
million from $953 million at securitization. The certificates
are collateralized by five mortgage loans ranging in size from 2%
to 46% of the pool.
Two loans, representing 31% of the pool, are on the
master servicer's watchlist. The watchlist includes loans
which meet certain portfolio review guidelines established as part of
the CRE Finance Council (CREFC) monthly reporting package. As part
of our ongoing monitoring of a transaction, Moody's reviews the
watchlist to assess which loans have material issues that could impact
performance.
Six loans have been liquidated from the pool with a loss, resulting
in (or contributing to) an aggregate realized loss of $6.8
million (19% loss severity on average). One loan,
the Trader Joe's Plaza Loan ($4.0 million --
46.5% of the pool), is currently in special servicing.
The loan was secured by a retail property in Las Vegas, Nevada and
the property was sold in May 2018.
Moody's was provided with full year 2016 operating results for 100%
of the pool and full or partial year 2017 operating results for 100%
of the pool (excluding specially serviced and defeased loans).
Moody's weighted average conduit LTV is 89% compared to 75%
at Moody's prior review. Moody's conduit component
excludes loans with credit assessments, defeased and CTL loans and
specially serviced and troubled loans. Moody's net cash flow
(NCF) reflects a weighted average haircut of 34% to the most recently
available net operating income (NOI). Moody's value reflects
a weighted average capitalization rate of 10%.
Moody's actual and stressed conduit DSCRs are 0.63X and 1.57X,
respectively, compared to 0.76X and 1.55X at the prior
review. Moody's actual DSCR is based on Moody's NCF
and the loan's actual debt service. Moody's stressed
DSCR is based on Moody's NCF and a 9.25% stressed
rate applied to the loan balance.
The top three loans represent 51.8% of the pool balance.
The largest loan is the Rite Aid -- Las Vegas, Nevada Loan
($1.8 million -- 20.9% of the pool),
which is secured by an approximately 17,000 square foot (SF) retail
property located in Las Vegas, Nevada. The property is fully
leased to Rite Aid, which subleases the space to Dollar General,
through June 2023. The loan is fully amortizing and matures in
June 2023. Moody's LTV and stressed DSCR are 66% and 1.64X,
respectively.
The second largest loan is the Bailey Building Loan ($1.8
million -- 20.4% of the pool), which is secured
by an approximately 45,000 SF office building located in Montgomery,
Alabama. As of December 2017, the property was 52%
leased, down from 88% as of December 2016. Moody's
LTV and stressed DSCR are 132% and 0.78X, respectively,
compared to 92% and 1.12X at the prior review.
The third largest loan is the Rite Aid -- Bayville, New Jersey
Loan ($909,314 -- 10.5% of the pool),
which is secured by an approximately 11,000 SF retail property located
in Bayville, New Jersey. The property is leased to Rite Aid
through September 2018. The loan has amortized 59% since
securitization and matures in September 2018. Moody's LTV and stressed
DSCR are 65% and 1.68X, respectively, compared
to 75% and 1.44X at the prior review.
REGULATORY DISCLOSURES
For further specification of Moody's key rating assumptions and sensitivity
analysis, see the sections Methodology Assumptions and Sensitivity
to Assumptions of the disclosure form.
The analysis includes an assessment of collateral characteristics and
performance to determine the expected collateral loss or a range of expected
collateral losses or cash flows to the rated instruments. As a
second step, Moody's estimates expected collateral losses or cash
flows using a quantitative tool that takes into account credit enhancement,
loss allocation and other structural features, to derive the expected
loss for each rated instrument.
Moody's did not use any stress scenario simulations in its analysis.
For ratings issued on a program, series or category/class of debt,
this announcement provides certain regulatory disclosures in relation
to each rating of a subsequently issued bond or note of the same series
or category/class of debt or pursuant to a program for which the ratings
are derived exclusively from existing ratings in accordance with Moody's
rating practices. For ratings issued on a support provider,
this announcement provides certain regulatory disclosures in relation
to the credit rating action on the support provider and in relation to
each particular credit rating action for securities that derive their
credit ratings from the support provider's credit rating.
For provisional ratings, this announcement provides certain regulatory
disclosures in relation to the provisional rating assigned, and
in relation to a definitive rating that may be assigned subsequent to
the final issuance of the debt, in each case where the transaction
structure and terms have not changed prior to the assignment of the definitive
rating in a manner that would have affected the rating. For further
information please see the ratings tab on the issuer/entity page for the
respective issuer on www.moodys.com.
For any affected securities or rated entities receiving direct credit
support from the primary entity(ies) of this credit rating action,
and whose ratings may change as a result of this credit rating action,
the associated regulatory disclosures will be those of the guarantor entity.
Exceptions to this approach exist for the following disclosures,
if applicable to jurisdiction: Ancillary Services, Disclosure
to rated entity, Disclosure from rated entity.
Regulatory disclosures contained in this press release apply to the credit
rating and, if applicable, the related rating outlook or rating
review.
Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moody's legal entity that has issued
the rating.
Please see the ratings tab on the issuer/entity page on www.moodys.com
for additional regulatory disclosures for each credit rating.
Christopher Bergman
Analyst
Structured Finance Group
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653
Matthew Halpern
Vice President - Senior Analyst
Structured Finance Group
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653
Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A.
JOURNALISTS: 1 212 553 0376
Client Service: 1 212 553 1653
