The LifeComps Commercial Mortgage Index found returns on investment for commercial mortgages held by life insurers were 14.7% for the full year of 2010, although the fourth quarter had the lowest ROI for the year.
The fourth quarter's return was 1.04%, compared with 4.01% in the third quarter, 4.64% in the second and 4.25% in the first. Income made up 1.54% of ROI, but price lost 50 basis points. This is the first loss in price for life company mortgage investments since the first quarter of 2009 and was driven by higher treasury yields which outweighed the positive effect from tighter spreads, LifeComps said.
By type, industrial had the best return at 1.57% followed by apartment at 1.32%, office at 0.97% and retail, 0.38%.
For the full year, 6.48% of the total return was income and 8.17% was price. Apartments led the way in 2010 with a 17.02% return, followed by retail at 15.85%, industrial at 13.92% and office at 12.30%.
