Mail Stop 3561
February 21, 2006
Timothy F. Danello
Senior Vice President and Assistant General Counsel
Wachovia Corporation
301 South College Street
Charlotte, NC 28288-0630
Re: Wachovia Commercial Mortgage Securities, Inc.
Registration Statement on Form S-3
Filed January 24, 2006
File No. 333-131262
Dear Mr. Danello:
We have limited our review of your filing for compliance
with
Regulation AB. Please note that our limited review covers only
those
issues addressed in the comments below. Please also note that our
comments to either the base prospectus and/or the supplements
should
be applied universally, if applicable.
Where indicated, we think you should revise your document in
response to these comments. If you disagree, we will consider
your
explanation as to why our comment is inapplicable or a revision is
unnecessary. Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us with
supplemental information so that we can better understand your
disclosure. After reviewing this information, we may raise
additional comments.
The purpose of our review process is to assist you in your
compliance with the applicable disclosure requirements and to
enhance
the overall disclosure in your filing. We look forward to working
with you in these respects and welcome any questions you may have
about our comments or on any other aspect of our review. Feel
free
to call us at the telephone numbers listed at the end of this
letter.
Registration Statement on Form S-3
General
1. Please confirm that the depositor or any issuing entity
previously
established, directly or indirectly, by the depositor or any
affiliate of the depositor has been current and timely with
Exchange
Act reporting during the last twelve months with respect to asset-
backed securities involving the same asset class. Please refer to
General Instruction I.A.4. of Form S-3. Also, please provide us
with
the CIK codes for any affiliate of the depositor that has offered
a
class of asset-backed securities involving the same asset class as
this offering.
2. Please confirm that all material terms to be included in the
finalized agreements will also be disclosed in the final Rule
424(b)
prospectus, or that finalized agreements will be filed
simultaneously
with or prior to the final prospectus. Refer to Item 1100(f) of
Regulation AB.
3. Please note that a takedown off of a shelf that involves
assets,
structural features, credit enhancement or other features that
were
not described in the base prospectus will usually require either a
new registration statement, if to include additional assets, or a
post-effective amendment. Refer to Rule 409 of the Securities
Act,
which requires that the registration statement be complete at the
time of effectiveness, except for information that is not known or
reasonably available. Please confirm for us that the base
prospectus
includes all assets, credit enhancements or other structural
features
reasonably contemplated to be included in an actual takedown.
4. If available, please provide us with a copy of any updated
pooling
and servicing agreement, marked to show changes from the prior
pooling and servicing agreement, including any changes you made to
comply with Regulation AB.
5. Disclaimers of liability for material information provided by
issuers or underwriters or any of their affiliates in not
appropriate. Please delete all such disclaimers of accuracy and
completeness, such as the ones found on pages S-76 and 62 of the
prospectus supplement and page 62 of the base prospectus.
Prospectus Supplement
General
6. We note that page 49 of the base prospectus contemplates a pre-
funding account to purchase additional mortgage loans. Please
provide a bracketed placeholder in the supplement showing that you
will provide the disclosure required by Items 1111(g) and
1103(a)(5)
of Regulation AB.
Cover Page
7. Please revise the third paragraph in the box on the left here,
the
applicable language on the cover page of the base prospectus, and
all
such references throughout the registration statement, to ensure
that
they accurately reflect the language under Item 1102(d) of
Regulation
AB. In this regard, please clarify that the securities represent
the
obligations of the "issuing entity."
8. Please briefly describe any credit enhancement or other support
for the transaction. Refer to Item 1102(h) of Regulation AB.
Summary, page S-7
9. Please identify, in an appropriate section of the summary, any
events in the transaction agreements that can trigger liquidation
or
amortization of the asset pool or other performance triggers that
would alter the transaction structure or flow of funds. Refer to
Item 1103(a)(3)(vii) of Regulation AB.
10. If applicable, please provide a bracketed placeholder showing
that you will identify any credit enhancement or support
providers.
Refer to Item 1103(a)(3)(ix) of Regulation AB.
11. Please summarize the circumstances under which pool assets may
be
added, removed or substituted. Refer to Item 1103(a)(6) of
Regulation AB.
The Parties, page S-8
12. Please revise your disclosure to clarify that the Trust Fund
and
the Issuing Entity are one and the same.
13. Also, it appears that the Mortgage Loan Sellers should be
called
Originators.
The Sponsor, page 54
14. Please tell us why Wachovia is identified as a party that
"may"
be a sponsor. There may be other sponsors if this is intended to
be
a rent-a-shelf filing but it appears that Wachovia might always be
one of the sponsors. Please advise.
Significant Originators, page S-63
15. Please confirm that you will provide the disclosure required
by
Item 1110 of Regulation AB.
Use of Proceeds, page S-113
16. Please expand the disclosure to provide the amount of expenses
incurred in connection with the selection and acquisition of the
pool
assets payable from the offering proceeds. Refer to Item 1107(j)
of
Regulation AB.
Appendix A-1, page A-1
17. We suggest explicitly incorporating the Appendices into the
text
to remove any misunderstanding that they are not part of the
prospectus supplement
Base Prospectus
Summary of Prospectus, page 7
The Mortgage Assets, page 8
18. Please revise to specify what you mean by your reference to
"other types of commercial properties" in the forth bullet point
of
page 8. Please note that a takedown off of a shelf that involves
assets that were not described in the base prospectus will usually
require a new registration statement.
Cash Flow Agreements, page 9
19. Please revise to specify what you mean by your reference to
"other types of similar agreements" described in the prospectus
supplement. The base prospectus should specifically describe each
form of derivative that is reasonably contemplated to be used in
an
actual takedown. Please delete any language that indicates
additional derivatives may be added in prospectus supplements.
20. Please confirm that you will not include in the asset pool any
derivative agreement that could be used to synthetically create a
non-ABS product whose payment would be based primarily by
reference
to something other than the performance of the receivables or
other
financial assets in the asset pool.
Risk Factors, page 13
Inclusion in a Trust Fund of Delinquent Mortgage Loans May
Adversely
Affect the Rate of Defaults and Prepayments on the Mortgage Loans,
page 34
21. Please reconcile your disclosure here and on page 44, that
some
assets may be delinquent as of the date of issuance, and your
disclosure on page S-52 of the prospectus supplement, wherein you
provide that no mortgage loan was more than 30 days delinquent as
of
the cut-off date. If applicable, please include bracketed
disclosure
in an appropriate section of the delinquency information for the
asset pool per Item 1111(c) of Regulation AB.
Descriptions of the Certificates, page 55
Distributions of Interest on the Certificates, page 56
22. Please confirm that all indices that may be used to determine
interest payments will be standard indices that measure interest
in
debt transactions and will not be indexes of commodities or
securities.
Descriptions of Credit Support, page 75
23. Please revise to specify what you mean by your reference here
and
on page 9 to another method of credit support described in the
related prospectus supplement. The base prospectus should
specifically describe each form of credit enhancement that is
reasonably contemplated to be used in an actual takedown. Please
delete any language that indicates additional credit enhancements
may
be added in prospectus supplements.
24. Please provide a bracketed placeholder in the prospectus
supplement if a credit enhancement provider might be liable or
contingently liable to provide payments representing 10% or more
the
cash flow supporting any offered class. Refer to Item 1114(b).
Part II
Signatures
25. Please revise to clarify that the registration statement is
being
signed by the Chief Executive Officer. Refer to General
Instruction
V.B. of Form S-3.
Undertakings, page II-2
26. Please provide the new undertakings required under Securities
Act
Reform. Refer to Item 512(a) of Regulation S-K
* * * * *
As appropriate, please amend your registration statement in
response to these comments. You may wish to provide us with
marked
copies of the amendment to expedite our review. Please furnish a
cover letter with your amendment that keys your responses to our
comments and provides any requested information. Detailed cover
letters greatly facilitate our review. Please understand that we
may
have additional comments after reviewing your amendment and
responses
to our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that the
filing includes all information required under the Securities Act
of
1933 and that they have provided all information investors require
for an informed investment decision. Since the company and its
management are in possession of all the facts relating to a
company`s
disclosure, they are responsible for the accuracy and adequately
of
the disclosures they have made.
Notwithstanding our comments, in the event the company
requests
acceleration of the effective date of the pending registration
statement, it should furnish a letter, at the time of such
request,
acknowledging that:
* should the Commission or the staff, acting pursuant to delegated
authority, declare the filing effective, it does not foreclose the
Commission from taking any action with respect to the filing;
* the action of the Commission or the staff, acting pursuant to
delegated authority, in declaring the filing effective, does not
relieve the company from its full responsibility for the adequacy
and
accuracy of the disclosure in the filing; and
* the company may not assert staff comments and the declaration of
effectiveness as a defense in any proceeding initiated by the
Commission or any person under the federal securities laws of the
United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in connection with our review of
your
filing or in response to our comments on your filing.
We will consider a written request for acceleration of the
effective date of the registration statement as a confirmation of
the
fact that those requesting acceleration are aware of their
respective
responsibilities under the Securities Act of 1933 and the
Securities
Exchange Act of 1934 as they relate to the proposed public
offering
of the securities specified in the above registration statement.
We
will act on the request and, pursuant to delegated authority,
grant
acceleration of the effective date.
We direct your attention to Rule 461 regarding requesting
acceleration of a registration statement. Please allow adequate
time
after the filing of any amendment for further review before
submitting a request for acceleration. Please provide this
request
at least two business days in advance of the requested effective
date.
If you have any questions regarding these comments, you may
contact John Stickel at (202) 551-3324. If you need further
assistance, you may contact me at (202) 551-3750.
Sincerely,
Max A. Webb
Assistant Director
cc: Via Facsimile (704) 348-5200
Stuart N. Goldstein, Esquire
Cadwalader, Wickersham & Taft LLP
227 West Trade Street
Charlotte, NC 28202
Wachovia Commercial Mortgage Securities, Inc.
February 21, 2006
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