MBA: Short-term Commercial Loans More Likely to Mature in 2009

There are $171 billion of commercial and multifamily mortgage loans held by non-bank lenders and investors that are set to mature this year, a survey from the Mortgage Bankers Association said. The Commercial Real Estate/Multifamily Survey of Loan Maturity Volumes found that short-term floating-rate mortgages in commercial mortgage-backed securities and mortgages held by credit companies, warehouse facilities and other investors are more likely to mature in 2009 and 2010 than are fixed-rate CMBS mortgages, mortgages held by life insurance companies or multifamily mortgages held or guaranteed by Fannie Mae, Freddie Mac or FHA. MBA found that $120 billion of non-bank commercial/multifamily mortgages are scheduled to mature in 2010. "Substantial concerns have been raised about the volume of mortgages maturing in the face of the current credit crunch," said Jamie Woodwell, MBA's vice president of commercial real estate research. "This study shows that while the dollar volume of maturing non-bank mortgages represents only one-tenth of the total outstanding balance, it is not evenly spread across investor and lender groups. Across all these investor groups, commercial/multifamily lenders and servicers have a wide variety of tools to help them deal with maturing mortgages, which should mitigate - but not eliminate - the impact of maturities in 2009." Of the total non-bank holdings of commercial/multifamily mortgages coming due in 2009, 52.8% is in CMBS, collateralized debt obligations or other forms of asset-backed securities, and an additional 33.6% is held by credit companies, warehouse facilities or other investors. Life insurance companies hold only 9.8% of the non-bank mortgages maturing in 2009, and 3.8% are held or guaranteed by Fannie Mae, Freddie Mac or FHA.