Originations

LoanCity, a wholesale lender based in San Jose, Calif., has unveiled the Take 5ive Option ARM, which it says combines the most attractive features of a payment-option adjustable-rate mortgage with the interest rate stability of a 5/1 hybrid ARM.The new product, which is available in most states, gives borrowers the options to pay at the low start-rate for up to five years; pay interest only; pay at a 15-year rate; or make regular principal and interest payments at a 30-year-level. Unlike most option ARMs, the note rate for the new product does not reset monthly; it is fixed for five years. (The current start rate is 2%.) LoanCity said its underwriting of the Take 5ive Option ARM is "extremely flexible." The product has a maximum loan amount of $3 million and can be matched with a piggyback home equity line of credit or loan from LoanCity. Borrowers can have credit scores as low as 620. Rick Soukoulis, chief executive officer of LoanCity, said the product "removes one of the biggest concerns about pay options: the monthly reset feature, which can create anxiety in a rising rate environment." The company can be found online at http://www.loancity.com.

Deutsche Bank Securities Inc., New York, has announced a joint venture with Pinnacle Financial Corp., an Orlando, Fla.-based mortgage lender, to form Pinnacle Commercial Mortgage LLC.The terms of the agreement were not disclosed. Pinnacle Commercial will be an originator of alternative-A, small-balance multifamily, commercial, and mixed-use mortgage loans. "Through this joint venture, Deutsche Bank and its Residential Mortgage-Backed Securities business will continue its expansion in U.S. mortgages and enhance the bank's securitization capabilities," said Phil Weingord, managing director and head of Global Markets Americas at Deutsche Bank Securities. Pinnacle Financial can be found online at http://www.pinnaclefinancial.com, and Pinnacle Commercial can be found at http://www.pcmnationwide.com. Deutsche Bank Securities is the investment banking and securities arm of Deutsche Bank AG, which can be found online at http://www.db.com.

William M. Wagner has been named senior vice president and chief accounting officer of Sunshine Hotel Investors Inc., a real estate investment trust based in San Clemente, Calif.Mr. Wagner was most recently Sunshine's vice president of accounting. He was previously vice president of accounting for The Trizetto Group and an auditor with Ernst & Young. The REIT can be found online at http://www.sunstonehotels.com.

Fred Kennon will retire June 30 as chief financial officer of Entertainment Properties Trust, a real estate investment trust based in Kansas City, Mo., and Gregory K. Silvers has been named to the additional post of chief operating officer of the REIT.In addition, Mark A. Peterson has been named vice president, CFO, and treasurer. The changes will take effect on June 30. Mr. Kennon has been CFO of the company since 1999, and will remain available as a consultant. Mr. Silvers has been the REIT's vice president, general counsel, and secretary since 1998 and its chief development officer since 2001, Entertainment Properties Trust said. Mr. Peterson was most recently the company's vice president of accounting and administration. David M. Brain, the REIT's president and chief executive officer, attributed the changes -- which he termed a "cohesive, planned expansion of our management resourcefulness" -- to a need to focus the company's management on its investment strategy of acquiring, financing, and leasing "high-quality destination properties." The company can be found online at http://www.eprkc.com.

Brookfield Properties Corp., together with the Blackstone Group, is acquiring Trizec Properties, Chicago, and Toronto-based Trizec Canada in a transaction valued at US$8.9 billion.Brookfield, a New York-based office real estate investment trust, is acquiring the common stock of Trizec Properties at $29.01 per share in cash and the shares of Trizec Canada for US$30.97 (C$34.09) per share in cash. The additional US$1.96 cash consideration per Trizec Canada share reflects the value of Trizec Canada's net assets other than its approximately 38% interest in Trizec Properties, Trizec said. The price for the Trizec Properties common stock represents an 18% premium over its June 2 closing price of $24.60 on the New York Stock Exchange. And the price for Trizec Canada shares represents a 30% premium over its closing price on the Toronto Stock Exchange on June 2, the REIT reported. Tim Callahan, president and chief executive of Trizec Properties, said Trizec "continues to be undervalued in the public markets" and added that the sale delivers better value to Trizec shareholders. Mr. Callahan said he does not expect to be a part of the organization after the expected closing of the sale in the third or fourth quarter. Brookfield can be found online at http://www.brookfieldproperties.com.

Home prices increased at an annualized rate of 8.7% nationwide in the first quarter, down from a revised rate of 12.9% in the fourth quarter, according to the Conventional Mortgage Home Price Index released by Freddie Mac.The Pacific states recorded the biggest price increases, with a 13.3% annualized growth rate, Freddie Mac said. The South Atlantic states experienced the second-highest annualized gains in the first quarter, with a 12.7% growth rate, and the Middle Atlantic states came in third, at 9.8%. "Home prices are starting to feel the effects of the upward trend in mortgage rates," said Frank Nothaft, Freddie Mac's chief economist. "That trend continued during the first quarter, with 30-year fixed mortgage rates climbing from an average 6.15% in January to 6.32% in March, according to the Primary Mortgage Market Survey.... We are expecting about half of the increase that we saw in the national average home-value appreciation in 2005 and 2006, which puts annual home price growth between 6% and 8%, depending on how fast interest rates rise over the remainder of the year." The index was jointly developed by Freddie Mac and Fannie Mae. Freddie Mac's website address is http://www.freddiemac.com.

Camden Property Trust, a Houston-based real estate investment trust, has priced a public offering of 3.6 million common shares at $71.25 per share.The multifamily REIT said it will use the net proceeds to reduce the balance under its unsecured credit facility. Deutsche Bank Securities Inc., the sole underwriter of the offering, has been granted an option to buy up to 360,000 additional common shares to cover any overallotments. Camden can be found on the Web at http://www.camdenliving.com.

Capmark Financial Group, Horsham, Pa., has appointed William F. Aldinger III president and chief executive officer of the company.Capmark, formerly GMACCH, said Mr. Aldinger is replacing Robert D. Feller, who is leaving the company. He will also serve on Capmark's board of directors. Most recently, Mr. Aldinger served as the chairman and CEO of HSBC North America Holdings, until his retirement last year, Capmark said. He has also been with Wells Fargo Bank, Citibank, and the U.S. Trust Co.

E*Trade Financial Corp., New York, and NeighborWorks America, Washington, D.C., have announced the launch of the "Keys to My Home" website, which offers bilingual, user-friendly information about preparing for and maintaining homeownership.Resources on the new website include "The Top 10 Questions to Ask Your Lender," a primer on home insurance, mortgage loan affordability and debt calculators, and a mortgage comparison worksheet. "Keystomyhome.org provides customized budget tables that fit the unique needs of each consumer," said Ken Wade, chief executive officer of NeighborWorks America. "This tailored approach is ... the perfect blend of technology and a human touch." The English version of the website launched June 1, and the Spanish version will be available this summer. The website is one of several education initiatives supported by E*Trade Financial and NeighborWorks America, including neighborhood computer-lab homebuyer kiosks in target minority and low- to moderate-income markets. The new site can be found online at http://www.keystomyhome.org.

Southcoast Financial Corp., Mt. Pleasant, S.C., has announced an agreement to acquire the assets of Charles Towne Mortgage Corp., Charleston, S.C.The terms of the deal were not disclosed. Southcoast said it will retain all employees of Charles Towne. Charles Towne will operate as an independent division of Southcoast Community Bank, a subsidiary of Southcoast Financial that can be found on the Web at http://www.southcoastbank.com.

Higher-priced home purchase loans rose 172% last year among the 10 leading national mortgage lenders, according to a study of federal Home Mortgage Disclosure Act data by Traiger & Hinckley LLP, a New York-based law firm.The firm said diminishing home equity and rising loan-to-income ratios were important factors in the increase. The study also showed that minority and white borrowers paid approximately the same average rate spread on higher-priced loans. "We interpret the growth in rate-spread loans as an attempt by lenders to manager increased credit risk without dashing the American dream of homeownership," said Warren Traiger, a partner in the law firm. "This strategy has not adversely impacted minority groups. On the contrary, lending to minority homebuyers has increased significantly and, despite the greater volume of higher-cost loans, the average price of those loans was consistent across different racial and ethnic groups." The law firm can be found online at http://www.traigerlaw.com.

Employment in the mortgage industry fell in April for the second month in a row.The U.S. Bureau of Labor Statistics reported that employment in the mortgage banker/broker sector slipped by 2,500 jobs, from 503,600 in March to 501,100 in April. Meanwhile, the U.S. economy created 75,000 new jobs in May, and the unemployment rate fell to 4.6%. (There is a one-month lag in BLS reporting of mortgage-sector employment data. The May data will not be released until early next month.)The BLS can be found online at http://stats.bls.gov.

Ashford Hospitality Trust Inc., a Dallas-based real estate investment trust, has been added to the MSCI US REIT Index, according to the REIT.The index was formerly known as the Morgan Stanley REIT Index. Ashford can be found online at http://www.ahreit.com, and MSCI can be found at http://www.msci.reit.

Post Apartment Homes LP, Atlanta, has priced a $150 million public offering of senior unsecured notes due 2013.The notes, priced at 0.998, will bear interest at 6.30%. Post Apartment Homes is the operating subsidiary of Post Properties Inc., a real estate investment trust that specializes in luxury apartments. The REIT can be found online at http://www.postproperties.com.

Campus Apartments, a Philadelphia-based student housing investor, has entered into a joint venture to invest as much as $1 billion in student housing with the real estate investment arm of the Government of Singapore Investment Corp., according to the company.Campus Apartments, which finances and manages housing on college and university campuses nationwide, said it expects to continue to develop and acquire student and faculty housing, condominiums, and other "related mixed-use development properties," both on- and off-campus, through the venture. The equity stake to be invested by the partners was not disclosed, but the company reported that the venture is likely to be "leveraged to more than $1 billion" to expand its investment capabilities. "The venture will enable us to execute on a healthy pipeline of deals throughout the country, and it catapults us into a leading position in the national college housing market," said David Adelman, president and chief executive officer of Campus Apartments.

The Eleventh Federal Home Loan District Cost of Funds Index continued its upward march in April, rising 13 basis points.The index as calculated by the Federal Home Loan Bank of San Francisco stood at 3.759%, compared with 3.624% in March. When compared with that of April 2005, the index has increased by 124 bps. For comparative purposes, the average rate for the 30-year fixed-rate mortgage increased 65 bps from April 2005 to April 2006, according to monthly data from the Freddie Mac Primary Mortgage Market Survey. In May it increased another 9 bps to 6.6%. On the other hand, the average rate for the one-year adjustable-rate mortgage increased 137 bps from April 2005 to April 2006, to 5.62%. For May, that rate increased just a single basis point.

The number of applications received by private mortgage insurers in April slipped below the total received in February, normally one of the worst months of the year.In April, according to a Mortgage Insurance Companies of America survey of its members, 101,070 applications were received, well below the 141,117 received in March and the 108,788 received in February. Only January has been slower in application activity for MIs over the last 12 months. In dollar volume, primary new insurance written totaled $13.6 billion in April, down over 35% from $20.9 billion in March. However, much of the decline was in the bulk category, as volume fell from just under $9 billion in March to only $2.6 billion in April. The traditional category was down by just $1 billion in April, to approximately $11 billion. New pool risk written for the month totaled $22.0 million, down from $76.7 million in March. In the last month of the past three quarters, mortgage insurers have done more than double the business in new pool risk written that they did in the first two months. The cure/default ratio was 98% in April, as cures totaled 34,866 and defaults totaled 35,570.

The average 30-year fixed mortgage rate rose from 6.62% to 6.67% over the seven-day period ended June 1, and the one-year ARM rate hit its highest level in nearly five years, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate rose from 6.23% to 6.26%, the average rate for five-year Treasury-indexed hybrid adjustable-rate mortgages rose from 6.21% to 6.26%, and the average rate for one-year Treasury-indexed ARMs climbed from 5.61% to 5.68%, its highest level since the 5.71% recorded in the week ended Aug. 17, 2001, Freddie Mac reported. Fees and points averaged 0.4 of a point for fixed-rate mortgages, 0.5 of a point for hybrid ARMs, and 0.7 of a point for one-year ARMs. "The [Federal Reserve Board] released the minutes of its most recent [Federal Open Market Committee] meeting, which showed that some members were concerned about inflationary pressure," said Frank Nothaft, Freddie Mac's chief economist. "This caused the bond market yields to rise, and brought about market speculation that the Fed may hike rates sooner than has been expected. All this combined to nudge rates up again this week." A year ago, the average 30-year and 15-year fixed rates were 5.62% and 5.20%, respectively, and the average one-year ARM rate was 4.26%, Freddie Mac said. Freddie Mac can be found online at http://www.freddiemac.com.

Washington Real Estate Investment Trust, Rockville, Md., has announced a public offering of 2.6 million shares of its common stock.The REIT said it will grant the underwriters an option to buy up to 390,000 additional shares to cover any overallotments. Credit Suisse First Boston will be the sole bookrunner and joint lead manager of the offering, with A. G. Edwards & Sons as the other joint lead manager. The REIT can be found online at http://www.writ.com.

Twenty-five subordinate certificates from 12 subprime home equity loan transactions issued by Structured Asset Securities Corp.'s Amortizing Residential Collateral Trusts have been placed under review for possible downgrade by Moody's Investors Service.The affected classes are as follows: series 2001-BC1, class M1 and class M2; series 2001-BC6, class M2; series 2002-BC1, class M2 and class B; series 2002-BC2, class M1, class M2, and class B; series 2002-BC3, class M2 and class B; series 2002-BC4, class M3 and class B1; series 2002-BC5, class M3; series 2002-BC6, class M3 and class B; series 2002-BC7, class B1, class B2, and class B3; series 2002-BC8, class M3, class M4, and class B; series 2002-BC9, class M3, class M4, and class B; and series 2002-BC10, class M3. The rating actions were based on the weaker-than-expected performance of the mortgage pools and the resulting erosion of credit support, Moody's said. The rating agency can be found online at http://www.moodys.com.