Fitch Affirms Bear Stearns 2007-TOP26; Assigns Outlooks

Business Wire, Oct 23, 2008

NEW YORK -- Fitch Ratings has affirmed and assigned Rating Outlooks to Bear Stearns Commercial Mortgage Securities Trust's commercial mortgage pass-through certificates, series 2007-TOP26 as follows:

--$58.9 million class A-1 at 'AAA'; Outlook Stable;

--$177 million class A-2 'AAA'; Outlook Stable;

--$65.4 million class A-3 at 'AAA'; Outlook Stable;

--$78 million class A-AB at 'AAA'; Outlook Stable;

--$991.9 million class A-4 at 'AAA'; Outlook Stable;

--$149.2 million class A-1A at 'AAA'; Outlook Stable;

--$210.6 million class A-M at 'AAA'; Outlook Stable;

--$160.6 million class A-J at 'AAA'; Outlook Stable;

--Interest-only class X-1 at 'AAA'; Outlook Stable;

--Interest-only class X-2 at 'AAA'; Outlook Stable;

--$42.1 million class B at 'AA'; Outlook Stable;

--$18.4 million class C at 'AA-'; Outlook Stable;

--$29 million class D at 'A'; Outlook Stable;

--$15.8 million class E at 'A-'; Outlook Stable;

--$18.4 million class F at 'BBB '; Outlook Stable;

--$18.4 million class G at 'BBB'; Outlook Stable;

--$18.4 million class H at 'BBB-'; Outlook Stable;

--$2.6 million class J at 'BB '; Outlook Stable;

--$2.6 million class K at 'BB'; Outlook Stable;

--$5.3 million class L at 'BB-'; Outlook Negative;

--$2.6 million class M at 'B '; Outlook Negative;

--$5.3 million class N at 'B'; Outlook Negative;

--$2.6 million class O at 'B-'; Outlook Negative.

Fitch does not rate the $15.8 million class P.

The rating affirmations reflect minimal paydown and stable performance since issuance. As of the October 2008 distribution date, the transaction has paid down by 0.81% to $2.089 billion from $2.106 billion at issuance. Rating Outlooks reflect the likely direction of any rating changes over the next one to two years.

There have been no specially serviced loans since issuance and no loan matures prior to 2011. Fitch has identified eight loans (3.9%) as Loans of Concern due to performance declines. The largest Fitch Loan of Concern (1.3%) is the Stony Point East & West. The loan, which had an investment grade shadow rating at issuance, is secured by two office properties located in Santa Rosa, CA. The servicer reported year end (YE) debt service coverage ratio (DSCR) of 1.70 times (x) is down from 2.29x at issuance. Combined occupancy has decreased to 75% as of June 30, 2008 from 94% at issuance. The loan is no longer considered investment grade.

The second largest Fitch Loan of Concern (0.8%) is secured by an office property in Ridgefield Park, NJ. Occupancy as of Dec. 31, 2007 was 69% down from issuance occupancy of 100%.

The transaction contains 12 shadow rated loans(18.1%) for which Fitch reviewed the most recent servicer provided operating statements: One Dag Hammarskjold Plaza (7.2%), Fulbright Tower (3.9%), 503 Broadway (1.4%), Harmony Marketplace (1.4%), Fox Chapel Shopping Center (0.7%), Byram Plaza Shopping Center (0.7%), HSBC Sioux Falls (0.7%), 38-05 to 38-17 and 37-27/29 Main Street (0.5%), 213 West 35th Street (0.5%), Bridgeport Stop & Shop II (0.4%), Westover Apartments (0.3%) and Whole Foods Santa Monica (0.3%). Based on their stable performance since issuance the remaining 12 loans maintain their investment grade shadow ratings.

One Dag Hammarskjold Plaza (7.2%) is a 782,928 square foot (sf) office property located on 2nd Avenue between 47th and 48th Streets in the Grand Central/UN submarket of Manhattan. Major tenants include Interpublic Group, Telerep, and Babcock & Brown, L.P. As of June 30, 2008 occupancy at the property was 98% compared to 97% at issuance. Servicer reported YE 2007 DSCR was 2.10x compared to 2.31x at issuance.

Fulbright Tower (3.9%) is a 1.2 million sf office tower located in the Houston, TX central business district and is part of the Houston Center Complex, also known as 3 Houston Center. The property is within walking distance of the George R. Brown Convention Center, Minute Maid Park, Toyota Center, and Hilton Americas and Four Seasons Hotels. Major tenants include Fulbright & Jaworski, Hydro Gulf of Mexico and Key Energy Services. As of June 30, 2008 occupancy has decreased to 86% from 89% at issuance. Servicer reported YE DSCR was 2.04x compared to 2.71x at issuance, and performance is expected to improve due to several new leases in 2007.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.