Approximately 8% of the outstanding balance of commercial and multifamily mortgages held by nonbank lenders and investors will mature in 2013, according to the Mortgage Bankers Association. By dollar amount it is a 21% drop to $119.5 billion from the $150.6 billion that matured last year.
But the biggest single chunk of loans maturing this year, $43.4 billion, is from commercial mortgage-backed securities. Another $38.1 billion is held by credit companies and other investors, with $21.9 billion held by life insurers and $16 billion in the portfolios of Fannie Mae, Freddie Mac, the Federal Housing Administration and Ginnie Mae.
“During the recession, and even in more recent years, approaching commercial and multifamily mortgage maturity volumes were referred to as akin to a ‘ticking time-bomb’ that would overwhelm the real estate finance markets,” said Jamie Woodwell, MBA’s vice president of commercial real estate research.
“Commercial and multifamily mortgages are generally long-term loans that span seven years, 10 years or longer, and each year since 2010 the volume of commercial and multifamily mortgages maturing in that year has declined.
“The volume of loans maturing in 2013 and 2014 will mark cycle lows for loan maturities, each representing less than 8% of the outstanding balance of loans. In reality, the relatively long-term nature of commercial and multifamily mortgage debt helped the market weather the recession and its slow recovery.”
The MBA added the number of loans maturing in 2013 over 2012 is increasing for the life companies and for the government-sponsored enterprises.
A separate study from Trepp found 72% of CMBS loans paid off as scheduled in 2012.