Originations

The Market Composite Index, an overall measure of mortgage applications, fell from 619.3 to 574.1 on a seasonally adjusted basis during the week ended Feb. 10, according to the Mortgage Bankers Association's Weekly Mortgage Applications Survey.On an unadjusted basis, applications decreased 4.4% on the week and were down 21.7% from the level recorded a year earlier. The Purchase Index fell from 425.1 to 391.7 on a seasonally adjusted basis, while the Refinance Index declined from 1751.0 to 1636.7. The four-week moving average for the Purchase Index fell from 444.6 to 431.6, and the comparable average for the Refinance Index fell from 1729.3 to 1727.2. Refinancings represented 41.2% of total applications, down from 42.1% the previous week, while adjustable-rate mortgages accounted for 29.6%, the MBA said. The average contract interest rate for 30-year fixed-rate mortgages remained at 6.25%, and points (including the origination fee) rose from 1.23 to 1.34 for loans with 80% loan-to-value ratios, the association reported. The MBA can be found online at http://www.mortgagebankers.org.

The Texas Department of Housing and Community Affairs has announced the release of $16 million for loans to qualified homebuyers wishing to buy a home in the 22 East Texas counties designated as the Hurricane Rita Gulf Opportunity Zone.Provisions of the Gulf Opportunity Zone Act of 2005 have enabled the TDHCA to make loans at a 4.99% interest rate through participating lenders in the so-called Rita GO Zone, the agency said. Under the program, an eligible borrower's income can be up to 140% of the area's median income and the purchase price can be as high as 110% of the area's median home price, according to the TDHCA. Further information on the program can be found online at http://www.myfirsttexashome.com.

The class B notes issued by HarbourView CDO III Ltd., a collateralized debt obligation that includes mortgage-backed securities, has been downgraded from CCC to C by Fitch Ratings.Fitch also affirmed the rating on the class A notes. The rating agency said the deal has been technically in default since March 2005, because the principal balance of the collateral debt securities fell below the aggregate balance of the rated notes. "Fitch has determined that the class B noteholders will continue to experience an impairment of principal and interest over the remaining life of the transaction and that the current ratings of the class B notes no longer reflect the current risk to noteholders," Fitch said. HarbourView III is composed of residential MBS, asset-backed securities, commercial MBS, real estate investment trusts, CDOs, and corporate debt.

Vornado Realty Trust, a real estate investment trust based in Paramus, N.J., has announced the pricing of an offering of $250 million of 5.6% senior unsecured notes at 99.906 by its operating partnership, Vornado Realty LP.The notes, due Feb. 15, 2011, were priced to yield 5.622%. The joint book-running managers for the offering are Banc of America Securities, Citigroup, and Deutsche Bank Securities. The equity REIT can be found on the Web at http://www.vno.com.

Prudential Real Estate Investors, Parsippany, N.J., has announced the formation of an exclusive lending program with Black Mountain Capital Inc., Burlingame, Calif., that offers short-term bridge loans to the commercial real estate industry.Black Mountain and PREI's Global Merchant Banking Group are managing the joint venture, PIM Black Mountain Domestic Venture I LLC, which will be funded initially with $50 million of capital, PREI said. "The venture will fill a void in the commercial finance industry by focusing on very-high-quality funding opportunities that would not otherwise fit into traditional lenders' underwriting criteria," said John Gregorits, a managing director at PREI. The companies can be found online at http://www.prei.com and http://www.blackmountaincapital.com.

Simpson Housing Limited Partnership LLLP, Denver, and Alaska Permanent Fund Corp., Juneau, Alaska, have announced an agreement under which APFC would acquire a co-controlling stake in Simpson, a large private multifamily development and operating company.The transaction would value Simpson in excess of $2 billion, the companies said. APFC would acquire the co-controlling stake in Simpson from the State of Michigan Retirement System. Deutsche Bank Securities acted as sole financial adviser to Simpson and SMRS, while CS Capital Management advised APFC.

The battle for the acquisition of The Town and Country Trust, a Baltimore-based real estate investment trust, is still going strong, with both Magazine Acquisition and Oriole Partnership hiking their bids.TCT has determined that the Oriole Partnership's revised offer is the better one, the multifamily REIT said. Magazine Acquisition has upped its offer to $39.60 per TCT share/operating partnership unit, as well as a prorata payment of dividends, from its previous offer of $39.00 per TCT share/OPU and a prorata payment. Oriole has bettered Magazine by making an offer of $40.15 per TCT share/OPU, plus a prorata dividend payment. Under the terms of an existing merger agreement between TCT and Magazine Acquisition, Magazine has until Feb. 16 to match the Oriole offer. TCT shares closed at $41.05 on Feb. 13. The REIT can be found online at http://www.tctrust.com.

Subprime lender People's Choice Financial Corp. is undergoing an audit in preparation for an initial public offering, a spokesman for the company has told MortgageWire.Based in Irvine, Calif., People's Choice is a top-40-ranked subprime funder founded in 1999 by Neil Kornswiet, a former top executive at Aames Financial, Los Angeles. The spokesman said PCFC is "working toward" an IPO, but could not say when the company might file an S-11 form with the Securities and Exchange Commission. In November the lender laid off 100 workers in an effort to cut costs and consolidate operations. In mid-December company executive vice president Reyes Topete retired, agreeing to stay on as a consultant. The company can be found online at http://www.pchl.com.

Brookdale Senior Living Inc., Chicago, has announced the establishment of a $330 million credit facility, of which $250 million is earmarked for acquisitions.The rest of the facility is devoted to working capital, Brookdale said. The company said it has committed to purchase $743 million in senior housing assets since its initial public offering in November 2005. The facility is provided by Lehman Brothers, Goldman Sachs, Citigroup, and LaSalle Bank. Brookdale can be found on the Web at http://www.brookdaleliving.com.

Zacks.com, the online unit of Zacks Investment Research Inc., Chicago, has placed Starwood Hotels & Resorts Worldwide, on its #5 Rank List -- Stocks to Sell Now.Zacks said Starwood recently issued earnings guidance of approximately $2.14 per share for 2006, after which 13 of the 16 analysts covering Starwood's stock revised their forecasts, dropping the consensus estimate to $2.15 per share. "Notably, even prior to Starwood's guidance, estimates had been falling -- over the past 60 days, the consensus forecast for 2006 profits has dropped by a cumulative 33 cents per share," Zacks reported. Zacks can be found online at http://www.zacks.com.

Bedford Property Investors Inc., Lafayette, Calif., has announced an agreement under which it will be acquired by an affiliate of LBA Realty LLC, Irvine, Calif.The agreement provides that Bedford's stockholders will receive $27.21 per share in cash for each share of Bedford's common stock and will cease to be stockholders in the company. Of the per-share total, $27 would be payable upon the consummation of the merger, and the rest would be paid in the form of a regular dividend of $0.21 for the quarter ending March 31. Bedford's series A and B cumulative redeemable preferred stock will remain outstanding after the closing of the transaction, which is expected to occur late in the second quarter. Bedford, an equity real estate investment trust, can be found online at http://www.bedfordproperty.com.

Class B of Aegis Asset Backed Securities Trust, series 2003-1, has been placed on Rating Watch Negative by Fitch Ratings.Fitch also affirmed the ratings on four other classes in the transaction, whose collateral pool consists chiefly of subprime residential mortgage loans. The watchlist placement is due to monthly collateral losses that have exceeded excess spread and reduced overcollateralization, the rating agency said. "As of the January distribution date, the OC balance had declined to $1,079,166, below its current target of $3,006,562," Fitch reported.

AmeriVest Properties Inc., a Denver-based real estate investment trust, has announced the approval by its board of directors of a plan to liquidate the company.AmeriVest said it estimates that liquidating distributions will be paid over a period of six to 24 months and that stockholders could receive $4.20-$4.80 per share in total distributions over that period. "With the adoption and implementation of this plan, we will be asking our shareholders to approve the process of monetizing value from the 12 properties currently owned by the company in Dallas, Phoenix, and Denver," said Charles Knight, the company's president and chief executive officer. AmeriVest said it has retained Trammell Crow Co. to serve as real estate adviser and broker in connection with the plan. The REIT can be found online at http://www.amvproperties.com.

The "litmus paper test" of whether something is a violation of the Real Estate Settlement Procedures Act is whether one is not certain of its legality, according to Lawrence Jacobson, an attorney from Beverly Hills, Calif.In that case, he told the Turn On Your Million-Dollar Brain VI conference in Ft. Lauderdale, Fla., one should work under the assumption that it is a violation. He added that the people who are most hurt by RESPA violators are the ones who comply with the law. As business slows down, the number of violations will increase, he said. Mr. Jacobson also reminded the audience that while something might pass muster under RESPA, it could be a violation of a state or local law.

Subprime lender NovaStar Financial postponed its fourth-quarter earnings release Friday morning, sending its stock down 12%.In a statement released just after midnight Thursday, the Kansas City, Mo.-based lender -- a target of short-sellers -- blamed the delay on its decision "to obtain legal opinions to further support certain tax positions" of the company. As of MortgageWire's deadline, its spokesman could not be reached for comment. In the statement, the nation's 17th-largest funder of subprime loans did not elaborate on the matter. Over the past six months some directors and officers, including director Gregory Barmore (a former chief executive of GE Mortgage Insurance), have been exercising options and announcing their intention to sell shares. At midday Friday, NovaStar was trading at $27.65, about $2 above its 52-week low and $15 below its high. NovaStar's subsidiary NovaStar Mortgage can be found on the Web at http://www.novastarmortgage.com.

Fannie Mae's multifamily investments totaled $25.6 billion last year, making it the second-best year for the company on that score, Fannie has reported at the Mortgage Bankers Association's commercial real estate finance convention in Orlando, Fla.The government-sponsored enterprise said production of small loans (up to $5 million) increased to $5.2 billion, a 53% rise over that of 2004. Investments in multifamily affordable housing, including bond credit enhancements, stood at $3 billion. Other Fannie Mae funding highlights for 2005 include a record $1.8 billion in equity investments that qualify for the low-income housing tax credit, and $15.8 billion in delegated underwriting and servicing product. The GSE can be found online at http://www.fanniemae.com.

The average 30-year fixed mortgage rate rose from 6.23% to 6.24% over the seven-day period ended Feb. 9, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate rose from 5.81% to 5.83%, the average rate for five-year Treasury-indexed hybrid adjustable-rate mortgages increased from 5.87% to 5.89%, and the average rate for one-year Treasury-indexed ARMs climbed from 5.33% to 5.34%. Fees and points averaged 0.6 of a point for fixed-rate mortgages and 0.7 of a point for ARMs. "With no big economic news to influence the direction of mortgage rates this week, the numbers drifted very slightly upward," said Frank Nothaft, Freddie Mac's chief economist. "We see this trend continuing through 2006, with the 30-year FRM ending the year at about 6.3% as the housing market eases back from last year's record-setting levels toward a somewhat more normal rate of activity." A year ago, the average 30-year and 15-year fixed rates were 5.57% and 5.10%, respectively, and the average one-year ARM rate was 4.11%, Freddie Mac said. Freddie Mac can be found online at http://www.freddiemac.com.

The battle for the acquisition of the Town and Country Trust, a Baltimore-based real estate investment trust, is heating up.The multifamily REIT has reported receiving a revised offer from Oriole Partnership, and Magazine Acquisition has also upped the ante. The offer from Oriole Partnership has been raised to $39.50 per share/operating partnership unit of TCT, as well as a prorata dividend payment per share/OPU, while Magazine Acquisition has increased its offer to $39.00 per TCT share/OPU plus a prorata dividend payment. The REIT reported that its board of trustees has determined that the Oriole Partnership revised offer is a "superior transaction." Magazine Acquisition has until Feb. 13 to match the Oriole offer before the TCT board can change its recommendation relating to a previous merger agreement with Magazine Acquisition. The REIT can be found online at http://www.tctrust.com.

ComUnity Lending, Morgan Hill, Calif., has consolidated its CreditFlex Funding nonprime lending division into its overall operations.The offices of CreditFlex Funding, which was started in late 2003 as the nonprime wholesale lending arm of ComUnity Lending, will now become ComUnity Lending offices, the parent company said. "We wanted to focus on providing a wide variety of products to our brokers, and found that having two separate divisions offering the same products was becoming redundant," said Jayson Stebbins, executive vice president of ComUnity Lending. "This is not a reflection on CreditFlex's success -- in fact, the division was very successful in developing new business in the nonprime lending arena for us." The company can be found online at http://www.comunitylending.com.

CoreLogic, a provider of mortgage risk assessment and fraud prevention systems, Sacramento, Calif., has announced the development of the Core Mortgage Risk Monitor, a map that forecasts the most likely locations of fraud "hot spots" over the next 12 to 18 months.CoreLogic said the five U.S. markets currently most at risk are Memphis; Youngstown-Warren-Boardman, Ohio-Pa.; Akron, Ohio; Dayton, Ohio, and Toledo, Ohio. The company said it will use its proprietary data systems to update the risk monitor on a quarterly basis. CoreLogic can be found on the Web at http://www.corelogic.com.