Fitch Downgrades 13 Classes from BSCMSI 2005-PWR7; Assigns Outlooks & LS Ratings

The downgrades are the result of Fitch's loss expectations and its
prospective views regarding cash flow declines and commercial real
estate market values. Fitch forecasts potential losses of 5.0% for this
transaction, should market conditions not recover. Today's rating
actions are based on the full losses of 5.0% as a majority of loans
mature in the next five years. The bonds with Negative Outlooks indicate
classes that may be downgraded in the future.

To determine potential defaults for each loan, Fitch assumed cash flow
would decline by 10% from year-end 2008. That is consistent with the
analysis used in its review of recent vintage transactions whereby cash
flow was assumed to decline 15% from year-end 2007 projected over a
three-year period. If the stressed cash flow would cause the loan to
fall below 0.95 times (x) debt service coverage ratio (DSCR), Fitch
assumed the loan would default during the term. To determine losses,
Fitch used the above stressed cash flow and applied a market cap rate by
property type, ranging between 7.5% and 9.5%, to derive a value. If the
loan balance at default is less than Fitch's derived value, the loan
would realize that amount of loss. These loss estimates were reviewed in
more detail for loans representing 55.4% of the pool and, in certain
cases, revised based on additional information and/or property
characteristics. Loss expectations attributed to loans reviewed in
detail represent 100% of the 5.0%.

Approximately 70% of the mortgages mature within the next five years as
follows: 0.5% in 2011, 17.5% in 2014, and 51.8% in 2015.

Fitch identified 119 Loans of Concern (25.0%) within the pool, two of
which (8.0%) are specially serviced. Six of the Fitch Loans of Concern
(18.8%) are within the transaction's top 15 loans, and two (8.0%) is
specially serviced.

Losses are expected on five (15.5%) of the loans within the Top 15: four
(14.0%) have defaulted, or are expected to default during the term,
while losses on one loan (1.5%) are expected at maturity. Loss
severities associated with these loans range from 9% to 48%. The largest
overall contributors to deal loss are as follows: Shops at Boca Park
(5.4%), Marquis Apartments (4.3%), and Garden State Pavilion (2.6%).

The Shops at Boca Park loan is secured by a 277,472 square foot (sf)
lifestyle center in Summerlin, NV, northwest of Las Vegas. The loan
transferred to the special servicer Oct. 20, 2009 for imminent default.
As of the August 2009 rent roll, the property was 85% occupied, down
from 97.9% at issuance. The largest tenants are The Great Indoors
(50.22% of net rentable area [NRA], expires 2022), Recreation Equipment,
Inc. (10.6%, expires 2019) and The Cheesecake Factory (3.55%, expires
2015). The property has lost a number of tenants as Las Vegas and the
surrounding suburbs have been hit by the current economic downturn. The
Las Vegas retail market continues to see the effect of the current
economic downturn with PPR forecasting vacancy to peak at 27.5% next
year. The servicer reported DSCR as of July 31, 2009 was 0.96x.

The Marquis Apartments loan is collateralized by a 641-unit multifamily
property in King Prussia, PA. Property amenities include: 24-hour
security, a fitness center, outdoor and indoor heated pool, parking, a
clubhouse and large outdoor recreation areas. Occupancy at the property
declined to 78% during the second quarter of 2009, down from 93% at
issuance. The servicer reported DSCR as of June 30, 2009 was 0.78x,
reflecting the drop in occupancy. The loan remains current as of
November 2009; however, Fitch expects the loan may default during the
term due to the declining occupancy.

The Garden State Pavilion loan is secured by a 389,384 sf anchored
retail center in Cherry Hill, NJ. The largest tenants at the property
are Shop Rite (27.9% of NRA, expires 2024), Ross Stores (11.7%, expires
2015), Staples (9.2%, expires 2013), Petco (7.3%, expires 2016),
Racetrack Supermarket (3.9%, expires 2024), and Old Country Buffet
(3.9%, expires 2013). The loan transferred to the special servicer Jan.
5, 2009 and is currently 90+ days delinquent. Occupancy has dropped to
72% from 82% at issuance. The decline in occupancy was manly driven by
the loss of Old Navy and Rack Room Shoes. As of Sept. 20, 2009, servicer
reported DSCR was 0.54x. The special servicer is pursuing foreclosure of
the property.

Fitch has taken the following rating actions as highlighted below. The
rating actions include downgrades, removal of classes from Rating Watch
Negative, the assignment and revision of Recovery Ratings (RRs), Loss
Severity (LS) ratings and Rating Outlooks:

--$85.7 million class A-J to 'AA/LS3' from 'AAA'; Outlook Stable;

--$33.7 million class B to 'A/LS4' from 'AA'; Outlook Stable;

--$8.4 million class C to 'BBB/LS5' from 'AA-'; Outlook Stable;

--$15.5 million class D to 'BB/LS5' from 'A'; Outlook Stable;

--$11.2 million class E to 'BB/LS5' from 'BBB+'; Outlook Negative;

--$11.2 million class F to 'BB/LS5'from 'BBB'; Outlook Negative;

--$9.8 million class G to 'B/LS5' from 'BBB-'; Outlook Negative;

--$12.7 million class H to 'B-/LS5' from 'BB-'; Outlook Negative;

--$4.2 million class J to 'B-/LS5' from 'B+'; Outlook Negative;

--$4.2 million class K at 'CCC/RR6' from 'B';

--$5.6 million class L at 'CCC'/RR6 from 'B-';

--$4.2 million class M at 'C/RR6' from 'CCC/RR1';

--$1.4 million class N at 'C/RR6' from 'CC/RR1'.

Fitch also affirms the following classes and assigns LS ratings, Rating
Outlooks and revises Recovery Ratings as indicated:

--$170.2 million class A-2 at 'AAA/LS1'; Outlook Stable;

--$106 million class A-AB at 'AAA/LS1'; Outlook Stable;

--$527.7 million class A-3 at 'AAA/LS1'; Outlook Stable;

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

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

--$2.8 million class P at 'C/RR6'.

Class A-1 has paid in full. Fitch does not rate the $14 million class Q.

Additional information on Fitch's amended criteria for analyzing recent
vintage U.S. CMBS is available in the July 8, 2009 report, 'Surveillance
Methodology for Recent Vintage U.S. CMBS' is available at 'www.fitchratings.com'
under the following headers:

Structured Finance then CMBS then Criteria Reports

Structured Finance then CMBS then Special Reports

Additional information is available at 'www.fitchratings.com'.

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SOURCE: Fitch Ratings

Fitch Ratings 
Jonathan Teichmann, 212-908-0862, New York 
Britt Johnson, 312-606-2341, Chicago 
or 
Media Relations: 
Sandro Scenga, 212-908-0278, New York 
Email: sandro.scenga@fitchratings.com

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