Class A through K and X Trust Certificates affected
Tokyo, December 15, 2009 -- Moody's Investors Service has placed 12 classes of L-JAC8 Trust
on review for possible downgrade; their final maturity will take
place in January 2013.
Class A, Aa2 placed under review for possible downgrade; previously,
downgraded to Aa2 from Aaa on June 2, 2009
Class B, A2 placed under review for possible downgrade; previously,
downgraded to A2 from Aa2 on June 2, 2009
Class C, Baa3 placed under review for possible downgrade; previously,
downgraded to Baa3 from A2 on June 2, 2009
Class D, Ba3 placed under review for possible downgrade; previously,
downgraded to Ba3 from Baa2 on June 2, 2009
Class E, B1 placed under review for possible downgrade; previously,
downgraded to B1 from Baa3 on June 2, 2009
Class F, B2 placed under review for possible downgrade; previously,
downgraded to B2 from Ba1 on June 2, 2009
Class G, B3 placed under review for possible downgrade; previously,
downgraded to B3 from Ba2 on June 2, 2009
Class H, Caa1 placed under review for possible downgrade; previously,
downgraded to Caa1 from Ba3 on June 2, 2009
Class I, Caa2 placed under review for possible downgrade; previously,
downgraded to Caa2 from B1 on June 2, 2009
Class J, Caa3 placed under review for possible downgrade; previously,
downgraded to Caa3 from B2 on June 2, 2009
Class K, Caa3 placed under review for possible downgrade; previously,
downgraded to Caa3 from B3 on June 2, 2009
Class X, Aa2 placed under review for possible downgrade; previously,
downgraded to Aa2 from Aaa on June 2, 2009
L-JAC 8Trust, effected in March 2008, represents the
securitization of two non-recourse loans.
The previous rating actions reflected Moody's concern about the
likelihood of collateral recovery, based on recovery stresses in
the range of 22% to 24% and 24% for the weighted
average (excluding the specially serviced loans) on the entire loan pool
(regarded as having a high likelihood of default).
Moody's received a servicer report on December 10, 2009,
on a loan that defaulted in July 2009, and interviewed the trustee
and servicer. In October 2009, it was decided that the servicer
will sell the loan at auction. The minimum reserve price for the
auction was decided on December 9, 2009, based on an appraisal
from a third party. (The special servicer is now preparing to sell
the loan.)
The rating action reflects Moody's growing concerns about the recovery
plan of the defaulted loan since Moody's assumption was based on the recovery
from the disposition of the underlying property instead of the disposition
of the underlying defaulted loan. Therefore, it is necessary
to anticipate further recovery stress for the disposition of the underlying
defaulted loan.
Additionally, in December 2010, another loan will mature,
for which Moody's will also estimate higher recovery stress than
was assumed in the previous rating action. The loan is backed by
a local mall with single tenant.
Moody's will closely monitor the prospects for loan disposition
and the performance of a remaining property to decide whether to confirm
or downgrade all classes.
The principal methodologies used in rating and monitoring the transaction
were "Moody's Approach to Monitoring CMBS Ratings in Japan" (October 2005)
and "Methodology Update: Surveillance Assumptions for Japanese CMBS"
(April 2009), which can be found at www.moodys.com
in the Research & Ratings directory, in the Rating Methodologies
subdirectory. Other methodologies and factors that may have been
considered in the process of rating this issue can also be found in the
Rating Methodologies subdirectory. Moody's publishes a weekly summary
of structured finance credit, ratings and methodologies, available
to all registered users of our website, at www.moodys.com/SFQuickCheck.
Moody's Investors Service is a publisher of rating opinions and research.
It is not involved in the offering or sale of any securities, nor
is it acting on behalf of the offering party. This release is not
a solicitation or a recommendation to buy, hold, or sell securities.
Tokyo
Takahiro Okubo
Asst Vice President - Analyst
Structured Finance Group
Moody's Japan K.K.
JOURNALISTS: (03) 5408-4110
SUBSCRIBERS: (03) 5408-4100
Tokyo
Koji Kumamaru
Managing Director
Structured Finance Group
Moody's Japan K.K.
JOURNALISTS: (03) 5408-4110
SUBSCRIBERS: (03) 5408-4100
Moody's reviews 12 classes of L-JAC 8 CMBS for possible downgrade