OREANDA-NEWS. Fitch Ratings has upgraded nine classes and affirmed one class of Bear Stearns Commercial Mortgage Securities Trust, series 2003-TOP12 (BSCM 2003-TOP12). A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

The upgrades are due to increased credit enhancement and better than expected recoveries on the resolution of two prior specially serviced loans. Fitch modeled losses of 5.4% of the remaining pool; expected losses on the original pool balance total 0.6%, including \$3.3 million (0.3% of the original pool balance) in realized losses to date.

Twenty loans remain in the transaction; there are currently no specially serviced loans however Fitch has designated three Fitch Loans of Concern (22.3%). Five loans (17.1% of the pool) are defeased. Given the concentration of the remaining collateral pool, Fitch has stressed the remaining loans by applying an additional reduction to the net operating income and applying a higher stressed cap rate to each loan to determine value.

As of the January 2015 distribution date, the pool's aggregate principal balance has been reduced by 93.9% to \$71 million from \$1.16 billion at issuance. Interest shortfalls are currently affecting class O.

The largest remaining loan is secured by a 10-story, 163-unit apartment complex located in the SoHo district of New York City (19.4% of the pool). The property is commonly known as the SoHo Abbey with amenities including an elevator, marble lobby, security, central air, and laundry room. The property reported occupancy of 96% as of year-end 2013. The property continues to perform well with a net operating income debt service coverage ratio (NOI DSCR) of 3.58x.

The largest loan of concern is secured by a seven-story, 102,309 sf office property located along US-1 in Boca Raton, FL (17.1%). The property became a Fitch Loan of Concern as a result of the largest tenant, Waddell & Reed Ivy Investment (39.9% of net rentable area), vacating upon their lease expiration in February 2013. Recently, a new lease has been signed with the personal injury law firm, Kanner & Pintaluga. The lease is for ten years and the firm will be occupying approximately 40,000 sf. While the year-to-date net operating income debt service coverage ratio (NOI DSCR) as of June 2014 was 0.68x, Fitch expects improvement to the property's overall performance upon Kanner & Pintaluga occupying the property.

RATING SENSITIVITIES

Rating Outlooks on all classes remain Stable due to increasing credit enhancement and continued paydown.

Fitch upgrades the following classes and assigns Rating Outlooks as indicated:
--\$10.4 million class D to 'AAAsf' from 'AAsf'; Outlook to Stable from Positive;
--\$14.5 million class E to 'AAAsf' from 'Asf'; Outlook Stable;
--\$7.3 million class F to 'AAsf' from 'Asf'; Outlook Stable;
--\$7.3 million class G to 'Asf' from 'BBBsf'; Outlook Stable;
--\$5.8 million class H to 'BBBsf' from 'BBsf'; Outlook Stable;
--\$5.8 million class J to 'BBBsf' from 'BBsf'; Outlook Stable;
--\$2.9 million class K to 'BBsf' from 'Bsf'; Outlook Stable;
--\$2.9 million class L to 'BBsf' from 'Bsf'; Outlook to Stable from Negative;
--\$2.9 million class M to 'Bsf' from 'CCCsf'; Outlook Stable assigned.

Fitch affirms the following class:

--\$2.9 million class N at 'CCCsf'; RE 100%.

Fitch does not rate the class O certificates. Fitch previously withdrew the ratings on the interest-only class X-1 and X-2 certificates.
Additional information on Fitch's criteria for analyzing U.S. CMBS transactions is available in the Dec. 10, 2014 report, 'U.S. Fixed-Rate Multiborrower CMBS Surveillance and Re-REMIC Criteria', which is available at 'www.fitchratings.com' under the following headers:

Structured Finance >> CMBS >> Criteria Reports