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"The spike in delinquencies due to Katrina became apparent in October. Based on preliminary October reports, 40 percent of the Katrina-affected loans were past due or delinquent. Of the multifamily loans reporting, approximately 50 percent are one-month delinquent." --Larry Kay, credit analyst and a director in the structured finance ratings group at Standard & Poor's.

Freddie Mac to Restate Its Profit Downward
Should Allstate Get a Helping Hand?

CMBS Servicers Discuss Hurricanes as DQ Numbers Rise
Offices 'Hot,' But Not 'On Fire,' Report Says

Red Mortgage Capital Uses FHA to Refinance Tuttle's Grove

TRIA Symposium Focuses on Risk

COMBOG Committee Update
MBA Legislative Advocacy Update
Clarification: Newmark Headquarters in San Francisco

Earn Your CMB at the 2006 CREF/Multifamily Housing Convention

Aerobiology Director Commends MBA Mold Paper

Forecasting Future Trends Contest at CREF

"The spike in delinquencies due to Katrina became apparent in October," said credit analyst Larry Kay, a director in the structured finance ratings group at Standard & Poor's, New York. "Based on preliminary October reports, 40 percent of the Katrina-affected loans were past due or delinquent. Of the multifamily loans reporting, approximately 50 percent are one-month delinquent."

The top three CMBS master servicers (by volume), Wachovia Securities, Charlotte, N.C., GMAC Commercial Mortgage (GMACCM), Horsham, Pa., and Midland Loan Services, Overland Park, Kan., combined their data and said 449 properties were affected by Katrina and Rita, totaling $2.8 billion as of September 28 and 598 properties were affected by the hurricanes at a total of $2.9 billion as of October 25.

At a CMBS roundtable held by Fitch Ratings, New York, servicers said they expect site inspections to start with a few weeks, but “an active B-piece buyer” said that master servicers should have been out inspecting properties sooner. According to the ratings agency, the master servicers argued that it was too early in the process to speak to borrowers at their properties because insurance adjusters had not yet evaluated the property. Also, master servicers said access to properties was “extremely limited” except for the largest assets.

“Properties should be inspected as soon as practical with care taken to protect the interests of the investors as well as the safety of the employees of both master and special servicers,” said Stephanie Petosa, senior director at Fitch Ratings.

Available information varied from satellite photos of affected properties to copies of actual insurance certificates. Loans on properties that were determined to be total losses based on pictures and conversations with borrowers have already been transferred to special servicers.

Servicers said they will decide on a loan-by-loan basis as to whether loans transfer to special servicing because of the differences in insurance coverage and the fact that each situation is unique, according to Fitch. One B-piece investor said that if the borrower cannot pay once business interruption insurance payments cease, the loan should be transferred to special servicing. “Close communication between master servicers and special servicers is crucial,” Petosa said.

Delinquent U.S. CMBS in the third quarter increased slightly to $3.001 billion after four quarters of consecutive decline, based on the percentage of resolutions being liquidated, according to Roy Chun, credit analyst and managing director in the CMBS surveillance group at Standard & Poor’s. “All property types, except retail, experienced increased delinquencies,” he said.

On a more positive note, the delinquency rate went down to 0.87 percent from 0.93 percent in the previous quarter due to continued strong issuance. The increase in the rate did not come from the hurricanes, Katrina and Rita, because many September loan payments had already been sent before Katrina hit land and when Rita made landfall later in the quarter, according to Standard & Poor’s.

The ratings agency said the effects of both hurricanes will become more evident this quarter despite a positive ratings performance. North American CMBS hit a record with 348 ratings upgrades and a total of 600 raised ratings for the year, 92 more than in 2004. Through September, Standard & Poor's initiated 680 total rating actions on outstanding CMBS, and nearly 88 percent were upgrades. The 15 downgrades for the quarter fell to their lowest level since the second quarter of 2001.

"Even after factoring in the potential rating effect of Katrina and Rita, we expect 2005 to close with the highest upgrade-to-downgrade ratio of any year since Standard & Poor's began rating CMBS," Kay said.

The major insurance question at the roundtable was the future of business interruption insurance for borrowers with businesses closed due to the hurricane but did not suffer “covered” hurricane effects such as flood or wind damage. Fitch said interaction between industry representatives is an effective plan that has yielded results in the past.

While it appears unlikely for the borrower or issuer to set aside additional reserves for unexpected events, servicers at the CMBS roundtable noted the trade organizations, such as the Mortgage Bankers Association (MBA) and the Commercial Mortgage Securities Association (CMSA), will continue discussions between servicers and the insurers to focus on projects such as the standardization of claim forms.

Meanwhile, advancing becomes a heightened issue in vintage deals, when loans in a pool decease and the potential for non-recoverability increases, according to Fitch. Servicers at the CMBS roundtable said the decision to advance payment based on their determination of non-recoverability should not change, and it did not seem to be a concern for investors.

September advancing was lighter than expected with payments in mid-stream when Katrina hit. While $6.7 million was advanced on 139 loans, servicers at the Fitch CMBS roundtable predicted 246 loans ($147 million) would be advanced in October and it is expected that insurance will kick in by November decreasing the need for advancing.

As for Wachovia, GMACCM and Midland, October advances were $5.3 million, far below estimates, Fitch said. Servicers said that business interruption insurance payments helped offset the amount of advancing requirements, so far.
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Offices 'Hot,' But Not 'On Fire,' Report Says
MBA (11/10/2005) Murray, Michael

Office recovery continues to gain momentum as vacancies decline across the country, but the sector is “no house of fire,” according to the Emerging Trends in Real Estate 2006 report released by the Urban Land Institute (ULI) and PricewaterhouseCoopers LLP, New York.

Given job losses, downsizing and outsourcing, office investors "need to accept stabilized vacancy [at a rate of about 10 percent]," the report said. "[Office] building owners face the music—demand growth for office space will likely not rise aggressively as it did in the 1990s."

While prime assets in good locations are the best bet to make decent holds, trophy buildings in high barrier-to-entry 24-hour high-growth markets are very attractive deals, according to the report. “Then, buyers should just back up the Brinks truck at closing.”
    
However, despite continuous flow of capital into the real estate industry, growth was stable overall, and it is likely to be more moderate over the next year compared to strong levels of growth in recent months. The survey respondents showed cautious optimism over the economy, with descriptions such as "pretty good," and "moving at three-quarters speed."

Based on the economy's moderate expansion across a wider range of sectors, growth could be more stable and sustainable, respondents noted, as consumer spending; energy prices; housing demand; job growth; corporate productivity gains and inflation factor into the equation for stability and growth in the office sector. Interviewees signaled caution over “a looming transition to a period of more measured, possibly lackluster, performance," the report said.

Higher home prices and home building costs, rising mortgage rates, and rising numbers of echo-boomer renters will boost occupancy and rents throughout 2006 and into 2007 in the apartment sector, the report said, but the condo craze could come back to haunt some high-end apartment markets with speculative buying driving demand. “For 2006, multifamily will be the bellwether for other sectors,” the report said. “If development imbalances can be controlled, increasing numbers of renters should bolster occupancies and increase cash flows, creating a landlord's market.”

Hotels and retail properties rank strongest in the survey. Hotels are making a "roaring comeback" as occupancy rates approach 70 percent making it the sector with the most potential, the report said. But researchers noted that higher airline fares and gas prices could hold up travel and slow growth trends as resorts and destination cities show “the most punch.”

Retail property performance "cannot get any better," based on steady jolts from continued consumer spending, the report said. However, while fortress malls and infill neighborhood centers in upscale suburban markets look “unassailable,” researchers said rising energy costs, higher property taxes, higher consumer credit interest rates, and increasing medical expenses could start to slow consumer spending. Holding the best infill properties is a “best bet” but temperamental energy prices will hold the key in the retail market, the report said.

Meanwhile, slow moving rents, excellent liquidity and a ready exit strategy define the report’s approach to industrial property. The report’s “best bet” for industrial property investors is to own big box warehouse in the small number of airport and seaport markets serving global transportation routes.

"Hold full-service hotels; sell or hold apartments; hold warehouses; sell commodity office; and sell retail," the report said.
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The refinance reduces the mortgage rate and extends the maturity date of the non-recourse financing to 40 years. The FHA insured loan was processed through the HUD-Columbus office.

Tuttle’s Grove II houses 297 units in 33 two-story buildings. Originally constructed in 1998 and financed with an FHA Section 221(d)(4) insured mortgage loan, the property consists of 60 one-bedroom units, 176 two-bedroom units and 61 three-bedroom units.

The sponsor of the project, Columbus-based Kontogiannis & Associates, specializes in high-end single and multifamily residential units including apartments and condominiums, as well as seniors housing that includes assisted living, Alzheimer’s and nursing facilities.

“The borrower was able to take advantage of the current interest rate environment and significantly reduce its annual mortgage payments,” said Edward Tellings, director of Red Mortgage Capital Inc.

Common amenities at Tuttle’s Grove II include a swimming pool, whirlpool/spa, tennis courts, clubhouse, fitness center, extra storage and gated entrance. Unit amenities consist of balconies, fireplaces, microwaves, dishwashers, washer & dryers and oversized closets.
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The University of Pennsylvania, Congressional Quarterly and the Communications Institute are sponsoring the event.

Click here to link to the Symposium online.
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General Committee News

Planning is underway for each committee to host a telephone conference meeting with its members during November and December 2005. Commercial/Multifamily NewsLink will carry notices of the dates and times of each committee’s call. All members are welcome to participate in these telephonic meetings regardless of membership on a particular committee. These calls are closed to the press.

The CREF Convention & Expo 2006 will soon be here (February 5-8, 2006). The Commercial Real Estate/Multifamily Finance Board of Governor's (COMBOG's) 11 standing committees will have in-person meetings at the CREF Convention on Sunday, February 5, 2006. Please plan to attend the committee meeting(s) that interest you. The meeting schedule is as follows:

9:00 a.m. – 10:00 a.m.
Research Committee
Education Committee
Legislative Committee

10:00 a.m. – 11:00 a.m.
Portfolio Investors Committee
Technology Initiatives Committee

10:00 a.m. – 11:30 a.m.
Multifamily Housing Committee

11:30 a.m. – 12:30 p.m.
Mortgage Banking Committee
International Committee
 
1:00 p.m. – 2:00 p.m.
Asset Administration Committee
 
2:00 p.m. – 3:00 p.m.
Loan Origination Committee Capital Markets Committee

Please plan to attend a special session at this year’s Convention: MBA 101 or Get up! Get Out! Get Going! on Sunday, February 5, 8:00 am to 9:00 am.

This session is tailored to introduce the committee process and the events of the CREF Convention to first time attendees and those who want to know how to become more involved in MBA’s activities. The session is hosted by a graduate of the MBA Future Leaders Program and representatives from the commercial/multifamily committees.

For information and registration for CREF 2006, please go to http://events.mortgagebankers.org/cref2006/default.html.
 
For additional information on any of MBA’s commercial/multifamily committees, including an online sign-up form, please go to http://www.mortgagebankers.org/cref/about/committees.html.

*****

COMBOG:  The first meeting of the 2006 COMBOG took place on Tuesday, October 25, in conjunction with MBA’s 92nd Annual Convention in Orlando, Fla. Twenty-five Board members participated in the meeting.

Ed Padilla, CEO of NorthMarq Capital Inc., Minneapolis, and 2006 COMBOG vice chair, led a discussion by addressing business and commercial/multifamily finance trends, based on the question: “Where is the commercial real estate finance industry going?”

The COMBOG touched on various issues such as the importance and changing nature of relationships in the industry between the intermediary, capital source and borrower. COMBOG members noted that there is a trend in the industry of combining more services, including finance and investment sales, and that today’s borrower is a more sophisticated customer.

Jack Cohen, CEO of Cohen Financial, Chicago, facilitated discussion focused on the industry’s need to continue to grow and educate staff to groom the next generation of mortgage banking leaders. COMBOG discussed ideas on how best to determine the sources for “new blood"; how a business recruits qualified staff; and how it determines training needs for that staff. The Board also discussed strategies a business can use beyond staff acquisition and training and how a firm can maintain high retention rate after significant investments were made in education and training.

Members pointed out that MBA can play a key role in the education process through Campus MBA with training for the CMB designation, the new Commercial School of Mortgage Banking, the upcoming Commercial Loan Originations 101, and the popular Regional Servicing Training Forums.

Tari Flannery, president, M&T Realty Capital Corporation, proposed the GSE Multifamily Inspector Qualifications Best Practices developed by the Multifamily Housing Committee for approval by the COMBOG. These best practices were developed in response to Fannie Mae and Freddie Mac proposing new requirements for property inspectors.

The GSEs also suggested MBA develop an inspectors’ training course to improve the quality of multifamily property inspections. The three-day course, developed by a working group under the auspices of the Multifamily and Education Committees and in conjunction with staff from Fannie Mae and Freddie Mac, will be offered for the first time in March 2006 in Washington, D.C., and Las Vegas.

Jonathan Kempner, president and CEO of MBA, presented an MBA Update to the COMBOG on the state of the Association, and MBA Chairman Regina Lowrie, CMB, briefed the COMBOG on her new think tank initiative, the Council to Shape Change, which was announced at the Annual Convention.

The Board received an update on MBA’s advocacy efforts, including a presentation by Mike Petrie, CMB, chair of the 2006 Legislative Committee, and Kurt Pfotenhauer, MBA’s senior vice president of government affairs, which provided an overview of MBA’s advocacy process. David Kittle, chairman of MORPAC, presented an update on MORPAC’s progress in 2005.

The many contributions of outgoing COMBOG chair, Dan Phelan, and outgoing MBA Chairman, Mike Petrie (MBA’s first Multifamily Chairman) were also recognized during the meeting.

The next meeting of the COMBOG will take place in conjunction with the CREF Convention & Expo 2006, on February 5, 2006, 3:30 pm – 6:00 p.m. in Orlando. 

Asset Administration:  The Asset Administration Committee continues to assist MBA members in addressing the business issues from the aftermath of the hurricane season.  Several conference calls have been held, the most recent on October 27, to focus on servicer concerns related to hurricane damage.  The call was chaired by Jan Sternin, senior vice president, Midland Loan Services Inc., Overland Park, Kan., and chair of the 2004-2005 Asset Administration Committee.  Regular calls will continue through the year to provide servicers an open forum for information exchange. The Commercial/Multifamily Hurricane Resource Center is updated regularly as new information and useful links are identified.  The Resource Center can be found at http://www.mortgagebankers.org/resources/katrina/cref_mf.html.

The SEC Asset-Backed Securities (ABS) Working Group completed a draft White Paper entitled Securities & Exchange Commission's Regulation of Asset-Backed Securities: Impact of Regulated Disclosure on CMBS Servicing.  The paper is available for industry comment through Friday, November 11.  Please contact Committee Staff Representative Katie Schwarting at kschwarting@mortgagebankers.org for additional information or to obtain a copy of the draft paper.  

MBA expects to finalize and distribute the final paper in early December.  The deadline for full compliance with the new regulation is January 1.

The CEO Servicing Advisory Group will hold its next call on Thursday, November 17, with Don Bober, Wells Fargo Commercial Mortgage Group, as chair.  Contact Katie Schwarting for additional information.

Capital Markets:  MBA’s Commercial/Multifamily group partnered with its residential counterparts to provide comments on three FASB Exposure Drafts in early October. 

The three drafts included:  1) Accounting for Servicing of Financial Assets, which contains guidance for applying an elective approach for measuring servicing rights at fair value; 2)  Accounting for Transfers of Financial Assets, which would clarify and/or change the terminology used to describe transferors’ interests in securitized financial assets, the initial measurement of transferors’ beneficial interests, the permitted activities & assets of qualifying special purpose entities (QSPEs) and the guidance relating to isolation of transferred assets; and 3) Accounting for Certain Hybrid Financial Instruments, which would require entities to evaluate any interests retained as a result of a securitization transaction to determine whether they contain “embedded derivative instruments.” 

All three Exposure Drafts would amend existing Statement of Financial Accounting Standards No. 140, Accounting for Transfers & Servicing of Financial Assets and Extinguishments of Liabilities.  These changes could have significant consequences on the entire commercial/multifamily real estate finance industry.

Education Committee: Work continues on development and implementation of the Multifamily Property Inspection course which will be offered in Las Vegas, and Washington, D.C., in March 2006.  Campus MBA, MBA’s educational arm, is also preparing for the second offering of the Commercial School of Mortgage Banking, March 5-10, 2006, Miami, Fla., and the first offering of Commercial Loan Origination 101, January 22-23, 2006 in San Francisco, Calif.

The Committee is also devoting attention to development of a range of coursework for the creation of a new MBA education designation, the Certified Mortgage Servicer (CMS). 

International:  The Committee is planning to have a guest speaker and special international reception at the CREF Convention in Orlando in February 2006.  Plans are underway for the Committee’s first call and meeting in December 2005 and February 2006, respectively.
 
Legislative Committee:  The committee continues to monitor and advise on MBA’s most pressing legislative and advocacy issues, including the extension of the Terrorism Risk Insurance Act (TRIA), GSE reform, and modernization of the REMIC laws. 
 
On October 19, commercial members Stacey Berger (Midland), Joe Franzetti (Citigroup) and Kathy Marquardt (GMACC) along with representatives from Real Estate Roundtable (RER), Commercial Mortgage Securities Association (CMSA) and National Association Real Estate Investment Trust (NAREIT), participated in a “fly-in” to visit Capitol Hill to discuss the extension of TRIA with key congressional members and staff.

On November 4, MBA delivered separate letters to the leadership of the Committee on Financial Services (US Senate) and the Banking, Housing, and Urban Affairs Committee (US House of Representatives) to urge them to support legislation that would make available federal terrorism insurance after the Terrorism Risk Insurance Act of 2002 (TRIA) expires on December 31.

The letters cautioned that the “the failure to have a federal terrorism insurance program in place on January 1, 2006 could result in significant breakdowns in the commercial real estate finance industry and other markets”.  The MBA continues to work closely with Congress to reach a bipartisan solution for this important issue.

Also on November 4, MBA’s Mortgage Action Alliance issued a Call to Action on TRIA urging members to contact their members of Congress in support of legislation that would either enact a terrorism insurance program or extend TRIA which expires on December 31. 

Loan Origination:  Staff Representative Katie Schwarting, attended and co-chaired the last meeting of the ASTM International Working Group on Maximum Seismic Probability, October 16-19, 2006 in Dallas.  MBA is working with ASTM to develop a seismic risk assessment standard.   An overview of the results of a recent survey of MBA members on seismic risk will be released before the end of 2005.  

In the aftermath of the hurricanes on the Gulf Coast, a useful resource for member companies will be MBA’s recently released white paper on mold entitled Mold: Steps toward Clarity.  The white paper is available via the web at:  http://www.mortgagebankers.org/cref/WhitePaper/PDF/Mold%20White%20Paper%20-%20FINAL.pdf.  

This paper was recently cited as an authoritative source on mold by Dr. Harriet Burge, director of aerobiology at Environmental Microbiology Laboratory Inc. and director of the microbiology laboratory at the Harvard School of Public Health (see Weekly Spotlight). 

The Committee also held conference calls with members to address business issues created in the aftermath of the recent hurricane season. 

Effective immediately, the new staff representative for the Capital Markets Committee is George Green, director, Commercial/Multifamily.  Green may be reached at (202) 557-2840 or ggreen@mortgagebankers.org.
 
Mortgage Banking:   Planning is underway for the scheduling of monthly telephone meetings of the Mortgage Banking Committee and a new schedule for 2006 is forthcoming.   A proposed issue that the Committee may address is to assess state licensing issues and, if using equity placement in the business model, equity registration requirements. 

Effective immediately, the new staff representative for the Mortgage Banking Committee is George Green, director, Commercial/Multifamily. He may be reached at (202) 557-2840 or ggreen@mortgagebankers.org.

Multifamily Committee:  The Committee finalized and submitted for approval to the COMBOG “best practices” for inspector qualifications for physical inspections of GSE-financed properties.  The best practices were approved by unanimous vote at the October 25 COMBOG meeting.  The best practices are available on the MBA website at: http://www.mortgagebankers.org/cref/1102.html. 

Several member calls have been held to discuss Hurricane Katrina housing relief and rebuilding efforts, and suggestions were made for legislative and regulatory changes to address multifamily lenders’ concerns. MBA is following up on those suggestions.

The Committee held its first meeting of 2006 by teleconference on October 19.  Notes from that meeting are available at:  http://www.mortgagebankers.org/cref/commit/multifamily/main.html.

An FHA Servicers Roundtable with HUD asset administration staff is scheduled for November 29 at MBA’s offices in Washington, DC.

Portfolio Investors:  The last of four Life Company Regional Roundtables for 2005 was held October 6 in Irvine, Calif.  The Roundtable was sponsored by Babson Capital Management LLC and hosted by Lydia Shen, managing director at Babson.   These roundtables, which are by invitation-only, are aimed at facilitating a high-level, peer-to-peer dialogue among key life insurance companies and other commercial real estate portfolio lenders.  A schedule of the roundtables for 2006 will be announced shortly.

Planning is underway for the Committee’s first telephone and in-person meetings in November 2005 and February 2006 as well as for the next round of Portfolio Investors Regional Roundtables.  Effective immediately, the new staff representative for the Portfolio Investors Committee is George Green, Director, Commercial/Multifamily.  Green may be reached at (202) 557-2840 or ggreen@mortgagebankers.org.

Research Committee:   MBA’s Commercial/Multifamily Research Committee will hold a conference call November 16 to kick off its new year.  Among the topics to be discussed are: an update on ongoing and "in-development" MBA commercial/multifamily research efforts; review of a draft survey to gauge research priorities of the MBA commercial/multifamily leadership; and planning for the Committee's year ahead, including the Research Committee meeting the morning of Sunday February 5 at the CREF Convention. 

To join MBA’s Research Committee visit http://www.mortgagebankers.org/cref/about/join.html.  To find out more about the Committee and/or MBA’s research, contact Jamie Woodwell at jwoodwell@mortgagebankers.org.

Technology Initiatives:  The Commercial Technology Initiatives Committee (the “CommTech Committee”) started to discuss data security for the commercial industry.  This complex issue was raised by MBA’s Board of Directors Technology Steering Committee at the MBA Annual Convention, and the CommTech Committee is currently in the “analysis” phase of preparing guidance information for the industry. 

Through its data standards subsidiary, the Mortgage Industry Standards Maintenance Organization (MISMO), MBA will release a technical standard by the end of the year to facilitate the movement of information when loan servicing rights transfer between trading partners. This standard is broadly aimed at all firms that acquire or place servicing, regardless of industry sector. For further details, please contact Dan Szparaga at dszparaga@mortgagebankers.org.
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MBA Legislative Advocacy Update
MBA (11/10/2005) Pfotenhauer, Kurt

TRIA Update
Last week, MBA contacted  all 50 governors' offices urging them to sign onto a letter  to Senate Majority Leader Bill Frist, R-Tenn., and Minority Leader Harry Reid, D-Nev., and a similar letter to House Speaker Dennis Hastert, R-Ill., and Minority Leader Nancy Pelosi, D-Calif., encouraging Congress to consider a temporary extension of the Terrorism Risk Insurance Act that ultimately leads to a long-term solution. MBA also sent the same letter to the presidents and executive directors of state MBAs, asking them for their help in obtaining governors' signatures. This effort was on behalf of the Coalition to Insure Against Terrorism (CIAT), of which MBA is a steering committee member.  
 
MBA anticipates that bills to extend TRIA will be introduced in the coming weeks in the House and Senate.  The latest intelligence indicates that leadership in both the House and Senate are committed to passing an extension of TRIA prior to Congress's adjournment for the year.  MBA contacted the chairmen and ranking members of the House Financial Services and Senate Banking Committees this week reiterating the importance of maintaining the availability and affordability of terrorism insurance beyond December 31.
 
For more information, please contact Josh Denney at (202) 557-2816 (jdenney@mortgagebankers.org).
 
House Subcommittee Marks Up Data Security Legislation
On November 3, the House Energy and Commerce Committee's subcommittee on Commerce, Trade and Consumer Protection marked-up and reported to the full Committee H.R. 4127, the Data Accountability and Trust Act . The bill, which was introduced by subcommittee Chairman Cliff Stearns, R-Fla., would require companies to safeguard sensitive financial information of consumers and to notify consumers when such information is compromised.

The bill's notification trigger is tied to a "significant risk of identity theft," and is confined only to information kept in electronic, unencrypted form.  Among the changes that were made during the mark-up was removal of enforcement by state attorneys general. 
 
For more information, please contact Rachel Voss at (202) 557-2865 (rvoss@mortgagebankers.org).             
 
White House Requests Funding For Hurricane Recovery
On October 28, the White House sent two requests to the House concerning funding for hurricane recovery.  The first request is to reallocate $17.1 billion of the $62.3 billion already appropriated by Congress for FEMA Katrina disaster relief.  $2.2 billion of the $17.1 billion is to go to HUD for the following purposes:
 
• $1.5 billion for Community Development Block Grants to assist states in providing housing, infrastructure and other needs related to rebuilding communities.
• $50 million for SHOP for land acquisition and other activities to provide 2,000 housing units for low-income families and to facilitate the new urban Homesteading Program.
• $200 million for the Urban Homesteading Program utilizing HUD foreclosed properties.
• $70 million for HOME for construction and rehabilitation of 4,000-4,500 housing units, with considerable waivers.
• $390 million for vouchers for 65,000 HUD assisted households and previously homeless people for six months (KDHAP).
 
The reallocation request also directs $105 million to USDA Rural Housing programs and $500 million to the Social Services Block Grant at the Department of Health and Human Services to provide social services to displaced people.
 
For more information, please contact Renee Rappaport at (202) 557-2758 (rrappaport@mortgagebankers.org).
 
House and Senate Pass FY 2006 Agriculture Appropriations Bill
The House and Senate last week passed the conference report accompanying the FY 2006 Agriculture appropriations bill, H.R. 2744 .  The bill includes $3.681 billion in budget authority for Section 502 single family guaranteed loans an increase of $622 million from FY 2005, and $100 million in budget authority for Section 538 multifamily guaranteed loans an increase of $800,000 from FY 2005. The bill now goes to the President for his signature.

For more information, please contact Renee Rappaport at (202) 557-2758 (rrappaport@mortgagebankers.org).
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Clarification: Newmark Headquarters in San Francisco
MBA (11/10/2005) MBA Staff

An article titled "Newmark Realty Capital Runs Successful MORPAC Campaign," in last week's MBA Commercial/Multifamily NewsLink, said the headquarters for Newmark Realty Capital was Long Beach, Calif. The corporate headquaters for Newmark Realty Capital is San Francisco, Calif.
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Michael Lipson

In the October 2005 issue of Indoor Environment Connections, Burge said MBA’s paper “directly confronts mold” and shows there are broader industry implications beyond mortgage lending. “I strongly recommend that you all read at least the executive summary of this white paper,” Burge wrote in her column. “It is well-written, based on good research and agrees in general with the best practices in our [environmental] industry.”

““The Mold White Paper is an excellent resource tool and has filled an industry void of  information specifically directed toward  lenders and servicers,”," said Don Glitz, vice president, corporate risk manager at GMAC Commercial Holding Corp , Horsham, Pa. "This article is a great example of the larger industry acceptance of MBA and its members' thoughtful work product.”

Burge, also an associate professor and director of the microbiology laboratory at the Harvard School of Public Health, said the paper summed up three major points in a succinct fashion. “The first is that ‘there is some possibility of a mold problem in any building or structure, and in any geographical area.’ This is absolutely true,” Burge said.

The aerobiology director and Harvard professor concurred with the paper that mold can appear at any time in the property’s life and can reappear if not properly removed. She also advocates the third point that responsibility of “all parties,” including mortgage lenders, building owners and managers, take a proactive approach to recognize and deal with a mold problem. “I personally feel that these three statements are the most valuable part of this white paper,” Burge said. “On the other hand, the article goes on to talk about investigations, remediation and clearance criteria” which Burge recommended for her readers.

Click here to view MBA's White Paper, “Mold: Steps Toward Clarity ,” or go to www.mortgagebankers.org, click on “Commercial/Multifamily,” and click "Standards & Best Practices" on the left.
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