NEW YORK--(BUSINESS WIRE)-- Fitch Ratings has affirmed Wachovia Bank Commercial Mortgage Trust, series 2003-C3 commercial mortgage pass-through certificates. A detailed list of rating actions follows at the end of this release.

The affirmations are due to stable performance and low Fitch expected losses. Fitch modeled losses of 1.80% of the remaining pool. As of the July 2011 distribution date, the pool's aggregate balance has been reduced by 30.59% (including 4% in realized losses) to $650.58 million from $937.26 million at issuance. Currently, 21 loans (23.44%) are defeased.

Fitch has identified 15 Loans of Concern (14.94%) including three assets in special servicing.

The largest contributor to loss (1.58% of pool balance) is a 464-unit multifamily property in San Antonio, Texas. The loan was transferred to the special servicer because of deferred maintenance and poor performance on the property. The borrower is currently coming out of pocket to keep the loan current because the property experienced severe declines in occupancy due to economic conditions.

The second largest contributor to loss (1.19% of pool balance) is a 108,738 square foot office property located in San Diego, CA. The property is current; however, the current occupancy of the building is at 71.76% and there is significant roll-over risk with 20 tenants (62.23% of square footage) leases expiring before the end of 2012.

Fitch has taken the following actions:

--$9.8 million class A-1 affirmed at 'AAAsf'; Outlook Stable;

--$477.8 million class A-2 affirmed at 'AAAsf'; Outlook Stable;

--$36.3 million class B affirmed at 'AAAsf'; Outlook Stable;

--$12.8 million class C affirmed at 'AAAsf'; Outlook Stable;

--$25.7 million class D affirmed at 'AAAsf'; Outlook to Positive from Negative.

--$12.8 million class E affirmed at 'AAsf'; Outlook to Positive from Negative;

--$10.5 million class F affirmed at 'Asf'; Outlook to Positive from Negative;

--$12.8 million class G affirmed at 'BBBsf'; Outlook to Stable from Negative;

--$12.8 million class H affirmed at 'BBsf'; Outlook to Stable from Negative;

--$22.2 million class J affirmed at 'CCCsf/RR1';

--$9.3 million class K affirmed at 'CCCsf/RR1';

--$7 million class L affirmed at 'Dsf'; to 'RR3' from 'RR1';

Classes M, N, and O remain 'Dsf' due to realized losses. The Recovery Ratings (RRs) of classes M and N have been revised as shown:

-Class M to 'D/RR6' from 'D/RR3';

-Class N to 'D/RR6' from 'D/RR4';

-Class O remains at 'D/RR6'.

Fitch does not rate class P. The class IO-I notes were previously withdrawn and the class IO-II notes have paid in full.

Additional information on Fitch's criteria for analyzing U.S. CMBS transactions is available in the Nov. 17, 2010 report, 'Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions', which is available at 'www.fitchratings.com' under the following headers:

Structured Finance >> CMBS >> Criteria Reports

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

Applicable Criteria and Related Research:

--'Global Structured Finance Rating Criteria' (Aug. 13, 2010);

--'Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions' (Nov. 17, 2010).

Applicable Criteria and Related Research:

Global Structured Finance Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=646569

Surveillance Methodology for U.S. Fixed-Rate CMBS Transactions

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=574208

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CONTACT:

Fitch Ratings
Primary Analyst
Matthew McGowan, +1-212-908-0733
Analyst
Fitch, Inc.
One State Street Plaza
New York, NY 10004
or
Committee Chairperson
Mary MacNeill, +1-212-908-0785
Managing Director
or
Media Relations:
Sandro Scenga, +1-212-908-0278 (New York)
sandro.scenga@fitchratings.com

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