OREANDA-NEWS. Fitch Ratings has downgraded one class and affirmed 20 classes of LB-UBS Commercial Mortgage Trust (LBUBS) commercial mortgage pass-through certificates series 2006-C1. A detailed list of rating actions follows at the end of this press release.

KEY RATING DRIVERS

The affirmations are a result of Fitch's stable loss projections for the pool. Fitch modeled losses of 20.8% of the remaining pool; expected losses on the original pool balance total 10.8%, including $164.5 million in realized losses to date. At Fitch's last rating action, expected losses for the original pool was 11.2%. Since the last review, several loans have been disposed via liquidation or payoff with better than expected recoveries. Because of this, Fitch has revised the Rating Outlook on class A-J from Negative to Stable.

In the last twelve months, 84 loans have repaid, contributing approximately $1.3 billion in principal paydown to the trust. Three outstanding loans, representing 5.8% of the pool, are fully defeased. There are 12 loans in special servicing, representing 48% of the pool. Four specially serviced loans are in the Top 15, including the largest loan in the pool. Most of these transfers occurred recently and were due to imminent maturity default, as much of the pool was scheduled to mature in December 2015 and January 2016. Thirty of the 32 outstanding loans are scheduled to mature in 2016; while Fitch believes many of those maturing loans not in special servicing will successfully refinance, it is possible that additional defaults will occur.

The largest contributor to expected loss remains DHL Center, the third largest loan, secured by an industrial building located west of Allentown, Pennsylvania. The property was previously occupied solely by DHL, which vacated the building in 2009 but has continued to pay rent per the original terms. Approximately 58.8% of the space is being subleased to two tenants, both with lease expirations in 2020. According to the servicer, the configuration of the property would make it difficult to lease the remaining portion, and it is not being marketed. The loan transferred to the special servicer in October 2015 after the borrower indicated it would not be able to refinance ahead of the loan's scheduled January 2016 maturity. The June 2015 DSCR was 1.30x. The loan remains current as of the December 2015 remittance.

The largest loan in the pool is also in special servicing and is a significant expected loss contributor. The collateral is a mall and lifestyle center in northeast Raleigh, North Carolina known as Triangle Towne Center. It is owned and operated by CBL and the non-collateral anchor tenants include Dillard's, Belk, Macy's, Saks Fifth Avenue and Sears. A competing mall is located approximately 10 miles away and features many of the same tenants as the subject. The loan, which was originally scheduled to mature in December 2015, transferred in September 2015 for imminent default and is now delinquent. Based on the servicer OSAR, the June 2015 trust NOI DSCR was 1.17x. The property was 85.6% occupied as of September 2015. According to the 2015 servicer site inspection, the subject has experienced historical vacancy issues within the lifestyle component.

The fourth largest loan in the pool is the next largest contributor to expected loss and is also secured by a mall. River Valley Mall, located in Lancaster, Ohio, is anchored by Sears, JC Penney, Elder-Beerman, Dick's Sporting Goods and a 10-screen Regal Cinemas. A sixth anchor pad is vacant. The mall is owned and operated by WP Glimcher and was 90.7% occupied as of September 2015; however, leases representing 20.3% of the NRA are scheduled to roll in 2016. The nearest competing mall is located approximately 20 miles away in Columbus, Ohio. The loan, which was originally scheduled to mature in January 2016, transferred to special servicing in October 2015 and remains current.

RATING SENSITIVITIES

The Rating Outlook to class A-M remains Stable and the Rating Outlook to class A-J has been revised from Negative to Stable. A number of loans refinanced or liquidated in the last twelve months with better than expected recoveries. Based on the credit metrics for the remaining loans in the pool, Fitch believes many of the loans expected to transfer ahead of maturity default have already done so. Upgrades to Class A-J in the near future are unlikely given the deal's concentration of specially serviced loans. Distressed classes may be subject to downgrades as losses are realized.

DUE DILIGENCE USAGE

No third party due diligence was provided or reviewed in relation to this rating action.

Fitch downgrades the following class as indicated:

--$18.4 million class E to 'Csf' from 'CCsf'; RE 0%.

Fitch affirms the following classes as indicated:

--$141.2 million class A-M at 'AAAsf'; Outlook Stable;
--$221 million class A-J at 'Bsf'; Outlook to Stable from Negative;
--$15.3 million class B at 'CCCsf'; RE 75%;
--$27.6 million class C at 'CCCsf'; RE 0%;
--$24.6 million class D at 'CCsf'; RE 0%;
--$21.5 million class F at 'Csf'; RE 0%;
--$13.4 million class G at 'Dsf' RE 0%;
--$0 class H at 'Dsf'; RE 0%;
--$0 class J at 'Dsf'; RE 0%;
--$0 class K at 'Dsf'; RE 0%;
--$0 class L at 'Dsf'; RE 0%;
--$0 class M at 'Dsf'; RE 0%;
--$0 class N at 'Dsf'; RE 0%;
--$0 class IUU-3 at 'Dsf'; RE 0%;
--$0 class IUU-4 at 'Dsf'; RE 0%;
--$0 class IUU-5 at 'Dsf'; RE 0%;
--$0 class IUU-6 at 'Dsf'; RE 0%;
--$0 class IUU-7 at 'Dsf'; RE 0%;
--$0 class IUU-8 at 'Dsf'; RE 0%;
--$0 class IUU-9 at 'Dsf'; RE 0%.

The class A-1, A-2, A-3, A-4, A-AB, IUU-1 and I-UU2 certificates have paid in full. Fitch does not rate the class P, Q, S, T and IUU-10 certificates. Fitch previously withdrew the ratings on the interest-only class X-CP and X-CL certificates.