|Title: ||MBA Report Shows Third Quarter 2009 Commercial and Multifamily Mortgage Performance Falls in Weakened Economy|
Washington, DC (December 7, 2009) – Delinquency rates continued to increase in the third quarter for most commercial/multifamily mortgage investor groups, according
to the Mortgage Bankers Association’s (MBA) Commercial/Multifamily Delinquency Report.
“Commercial and multifamily mortgages continued to feel stress in the face of the weakened economy,” said Jamie Woodwell,
MBA’s Vice President of Commercial Real Estate Research. “The deterioration in commercial and multifamily loan performance
is generally in line with what is being seen in other parts of the economy, with loans backed by commercial properties continuing
to perform far better than construction and development loans.”
Construction and development loans are not included in the numbers presented here, but are included in many regulatory definitions
of ‘commercial real estate’ despite the fact that they are often backed by single-family residential development projects
rather than by office buildings, apartment buildings, shopping centers or other income-producing properties.
Between the second and third quarters, the 30+ day delinquency rate on loans held in commercial mortgage-backed securities
(CMBS) rose 0.17 percentage points to 4.06 percent. The 60+ day delinquency rate on loans held in life company portfolios
rose 0.08 percentage points to 0.23 percent. The 60+ day delinquency rate on multifamily loans held or insured by Fannie
Mae rose 0.11 percentage points to 0.62 percent. The 90+ day delinquency rate on multifamily loans held or insured by Freddie
Mac remained unchanged at 0.11 percent. The 90+day delinquency rate on loans held by FDIC-insured banks and thrifts rose
0.51 percentage points to 3.43 percent.
Based on the unpaid principal balance of loans (UPB), delinquency rates for each group at the end of the third quarter were
• CMBS: 4.06 percent (30+ days delinquent or in REO);
• Life company portfolios: 0.23 percent (60+days delinquent);
• Fannie Mae: 0.62 percent (60 or more days delinquent)
• Freddie Mac: 0.11 percent (90 or more days delinquent);
• Banks and thrifts: 3.43 percent (90 or more days delinquent or in non-accrual).
The MBA analysis looks at commercial/multifamily delinquency rates for five of the largest investor-groups: commercial banks
and thrifts, commercial mortgage-backed securities (CMBS), life insurance companies, Fannie Mae and Freddie Mac. Together
these groups hold more than 80 percent of commercial/multifamily mortgage debt outstanding.
The analysis incorporates the same measures used by each individual investor group to track the performance of their loans.
Because each investor group tracks delinquencies in its own way, delinquency rates are not comparable from one group to another.
The Mortgage Bankers Association (MBA) is the national association representing the real estate finance industry, an industry
that employs more than 280,000 people in virtually every community in the country. Headquartered in Washington, D.C., the
association works to ensure the continued strength of the nation's residential and commercial real estate markets; to expand
homeownership and extend access to affordable housing to all Americans. MBA promotes fair and ethical lending practices and
fosters professional excellence among real estate finance employees through a wide range of educational programs and a variety
of publications. Its membership of over 2,200 companies includes all elements of real estate finance: mortgage companies,
mortgage brokers, commercial banks, thrifts, Wall Street conduits, life insurance companies and others in the mortgage lending
field. For additional information, visit MBA's Web site: www.mba.org.