Originations

Brandywine Realty Trust, Plymouth Meeting, Pa., has announced the completion of a sale of 7.75 million shares of common stock to Citigroup Global Markets Inc.The net proceeds of $217.1 million will be used to fund a portion of the company's pending acquisition of The Rubenstein Co. LP, Brandywine said. Brandywine, an office and industrial real estate investment trust, can be found on the Web at http://www.brandywinerealty.com.

Two classes of Morgan Stanley Capital I Inc.'s commercial mortgage pass-through certificates, series 1997-XL1, have been downgraded by Fitch Ratings and removed from Rating Watch Negative.Class G was downgraded from BB to B, and class H was downgraded from B-minus to CCC. The rating agency also affirmed the ratings on nine other classes in the deal. Fitch attributed the downgrades to declining operational performance at three of the properties securing the loans: the Grand Kempinski Hotel, Westgate Mall, and Westshore Mall. Fitch can be found online at http://www.fitchratings.com.

Dev Ghose has been elected to the position of executive vice president and chief financial officer by the board of directors of Shurgard Storage Centers Inc., Seattle.Mr. Ghose, who joined the real estate investment trust in June, succeeds Shurgard president Dave Grant, who has been serving as interim CFO, the REIT said. From 1986 to 2003, Mr. Ghose served in various executive posts at Health Care Property Investors, including senior vice president for finance.

At midyear, GMAC Commercial Holding was the No. 1 commercial mortgage servicer in terms of total named servicing volume, with a $240.70 billion portfolio, according to the Mortgage Bankers Association.No. 2 on the list, Wachovia Securities, is well behind GMAC, with a portfolio totaling $140.51 billion. The rankings are based on the MBA's survey of large commercial mortgage-backed securities servicers -- with at least $1 billion in named CMBS servicing volume -- for the period ending June 30. Also on the list -- which includes the servicer's CMBS, life company, and other commercial mortgage loans serviced -- are: Midland Loan Services ($102.43 billion); Lennar Partners ($100.57 billion); GEMSA Loan Services ($60.67 billion); Wells Fargo Commercial Mortgage Servicing ($44.26 billion); Bank of America ($44.22 billion); Prudential Asset Resources ($43.51 billion); ARCap Servicing ($42.61 billion); and Washington Mutual Bank ($32.43 billion). The MBA can be found online at http://www.mortgagebankers.org.

Citigroup and the Association of Community Organizations for Reform Now have announced what they termed "a landmark partnership" to promote homeownership in low- and moderate-income neighborhoods, increase the availability of affordable credit, and promote financial education.Under the partnership, Citigroup and ACORN have agreed to collaborate on several initiatives, including a joint program between Citi and ACORN Housing Corp. to develop a specialized mortgage product for all AHC's homeownership centers and to make mortgages available to immigrants previously shut out of the market. The other initiatives include: expanding access to the Earned Income Tax Credit and, in immigrant communities, to Citibank's Access Account (for previously "unbanked" consumers) and low-cost remittance program; expanding financial education for low- and moderate income consumers; focusing on community development lending to increase affordable housing; providing access to the best combination of loan product, price, and service; and establishing a net-benefit test for real-estate-secured loans. "This is the beginning of what we believe will be a long and successful relationship," said Kevin Kessinger, executive vice president of Citigroup's Global Consumer Group and president of its Consumer Finance North America unit.

General American Corp., a Pittsburgh-based provider of title insurance and settlement services to the mortgage banking industry, has reported the expansion of its operations into Texas with the opening of GAC of Texas in Houston.Industry veteran Steve Black has been named senior vice president and will oversee the operation, which will involve comprehensive title and settlement services for the entire state through a network of vendor partnerships, GAC said. "Our new operations will act as a springboard to allowing us to offer a broader menu of services in the Southwest," said GAC president Rich Snedden. GAC, a unit of Fiserv, can be found online at http://www.gac.com.

Health Care REIT, Toledo, Ohio, has priced the sale of $50 million of senior unsecured notes due Nov. 15, 2013, at an effective yield of 5.68%.The notes are an add-on to $250 million of senior unsecured notes issued in November 2003, the real estate investment trust said. The net proceeds will be used to invest in additional health care properties. The manager of the offering was UBS Investment Bank. The REIT can be found online at http://www.hcreit.com.

Bridger Commercial Funding, San Francisco, has announced the closing of its third securitization of the year, a $1.2 billion deal in which it participated with Banc of America Securities.Bridger said it has securitized more than $1.6 billion in commercial real estate mortgage loans since 1999, working through its nationwide network of over 1,500 commercial banks. The company can be found on the Web at http://www.bridgerfunding.com.

Ashford Hospitality Trust, a real estate investment trust based in Dallas, has priced an offering of 2.0 million shares of 8.55% cumulative preferred stock at $25 per share.The proceeds of $48 million will be used for general corporate purposes, including the acquisition of additional hotel investments, Ashford said. Wachovia Securities and Friedman Billings Ramsey were the joint book-running managers of the offering, and Legg Mason Wood Walker Inc. and Stifel, Nicolaus & Co. were the co-managers. The underwriters were granted a 30-day option to buy up to 300,000 additional shares to cover any overallotments. The REIT can be found online at http://www.ahtreit.com.

InterFirst Wholesale Mortgage Lending, Ann Arbor, Mich., has reported the introduction of renovation and rehabilitation mortgage loans through its Construction Lending Center.The loans, part of the company's "All in One" construction loan program, provide funding based on the completed value of the home after the renovation, enabling consumers to afford major renovations or repairs, InterFirst said. "By providing the ideal solution for consumers considering the purchase of a home that requires some upgrades, rehabilitation and renovation loans enable mortgage brokers to continuously build two valuable referral sources: Realtors and builders," said InterFirst president William A. Newman. The wholesaler, a division of ABN Amro Mortgage Group, can be found online at http://www.interfirst.com.

A new tuition-free, Internet-based training program designed to help bilingual military personnel enter the mortgage finance industry, and thereby promote Latino homeownership, has been announced by Freddie Mac and the Mortgage Bankers Association.Called Welcome Home, the new program also boasts the participation of the Department of Defense Reserve Forces Policy Board, the National Association of Hispanic Real Estate Professionals, the National Puerto Rican Coalition, Univision, and four prominent lenders: Branch Banking & Trust, CitiMortgage, GMAC Mortgage, and U.S. Bank Home Mortgage. Freddie Mac and the MBA said the program will aim at providing about 1,000 new graduates a year for potential careers in mortgage sales, origination, underwriting, servicing, collections, and commercial and multifamily lending. "A lack of bilingual information about homebuying and mortgage finance may be stopping thousands of Latino families from seriously considering homeownership, according to numerous studies," the organizations said.

The average 30-year fixed mortgage rate fell to 5.75% for the week ending Sept. 17 from 5.83% the previous week, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate fell from 5.22% to 5.13%, while the average rate for one-year Treasury-indexed ARMs climbed from 4.00% to 4.03%. Fees and points averaged 0.8 of a point for fixed-rate mortgages and 0.7 of a point for ARMs. "The Consumer Price Index figures released [Sept. 16] showed that the run-up in oil prices has not been inflationary at the consumer level, much to the relief of mortgage lenders," said Frank Nothaft, Freddie Mac's chief economist. "And price stability in products other than oil have allowed for more money to go toward homebuying and home projects." A year ago, the average 30-year and 15-year fixed rates were 6.16% and 5.46%, respectively, and the average one-year ARM rate was 3.87%, Freddie Mac said. Freddie Mac can be found online at http://www.freddiemac.com.

Bank of America, Charlotte, N.C., one of the largest players in residential loans, has a new mortgage chief -- Floyd Robinson.On Thursday the nation's sixth-largest funder named Mr. Robinson president of its consumer real estate division, which oversees mortgage banking. Mr. Robinson replaces Kevin Shannon, who was named the bank's chief credit management and portfolio analysis executive. Mr. Shannon played a key role in BoA's expansion of its presence in retail and wholesale lending by beefing up its hiring of account executives. (About two years ago, BoA exited the correspondent channel entirely.) Mr. Robinson was promoted from his position as president of dealer financial services, which oversees auto, recreational vehicle, and marine lending. Dealer services has $26 billion in assets. BoA's mortgage unit has $253 billion in housing receivables on its books, ranking fifth nationwide.

Only 10% of those questioned in a recent survey could name their credit score, according to TrueCredit.com, San Luis Obispo, Calif., which commissioned the poll.The survey also found that only one in eight respondents knew that the 650-850 range represents what is deemed a "good" credit score. (An interesting finding was that one in five Americans living in the West were able to identify a good credit score, far better than the national average, TrueCredit said.) "It is shocking how little Americans know about their credit," said John Danaher, president of TrueCredit. "Consumers are in the dark as to their financial well-being, and this is likely costing them billions each year." The survey was conducted by Roper Public Affairs. TrueCredit can be found on the Web at http://www.truecredit.com.

A rebound in economic growth and job gains over the next year, combined with a decline in oil prices and increased spending by businesses, bodes well for the commercial real estate sector, according to the National Association of Realtors.Walt McDonald, president of the NAR, said vacancy rates have been "steadily declining" for various commercial property types due to a growing demand for space. "It looks like we'll see an acceleration in the demand for space over the next year with declining vacancy rates in the office, industrial, and multifamily sectors," Mr. McDonald said. Based on data provided by Boston-based Torto Wheaton Research, the NAR reported that office and industrial markets on the East and West Coasts are faring the best. Net absorption of office space should total 45.3 million square feet this year, up from 20 million square feet in 2003, the NAR said. The association said it expects net absorption in the multifamily sector to be at 260,000 units, compared with 159,400 units for 2003. The NAR can be found on the Internet at http://realtor.org.

The Market Composite Index, an overall measure of mortgage applications, fell from 692.0 to 678.2 on a seasonally adjusted basis during the holiday-shortened week ended Sept. 10, according to the Mortgage Bankers Association's Weekly Mortgage Applications Survey.On an unadjusted basis, applications declined 22.5% on the week and was down 25.4% from the level of a year earlier (a week that did not include Labor Day). The Purchase Index fell from 476.0 to 455.7 on a seasonally adjusted basis, while the Refinance Index climbed from 1948.9 to 1972.5. Refinancings represented 43.2% of total applications, up from 41.4% the previous week, while adjustable-rate mortgages accounted for 33.0%, the MBA said. The average contract interest rate for 30-year fixed-rate mortgages fell from 5.79% to 5.68%, and points (including the origination fee) decreased from 1.37 to 1.36, for loans with 80% loan-to-value ratios, the MBA reported. The MBA can be found online at http://www.mortgagebankers.org.

The 1999 North Carolina anti-predatory-lending law has caused a decline in lending to minority and low-income borrowers, according to a study released by the Mortgage Bankers Association.In addition, the MBA said the study demonstrates that the North Carolina law has had negative effects on the availability of credit for all income and racial groups. The study, conducted by Abt Associates Inc., Cambridge, Mass., looked at lending volumes before and after the law was passed on a census-tract-by-census-tract basis and compares the results with what took place in states with economies similar to North Carolina's. "The study reveals, vis-à-vis the anti-predatory lending bill, the North Carolina state legislature has imposed a modern-day form of redlining on its citizens by choking off mortgage credit to minority and low-income neighborhoods," said MBA chairman Robert M. Couch. The study analyzed the changes in lending in North Carolina and the neighboring states of Tennessee and South Carolina before and after passage of the North Carolina law. Among the study's major findings is that overall lending in predominantly minority neighborhoods declined 1.2% in North Carolina after passage of the law, compared with a 5.2% increase in the comparison states. Loans by subprime lenders declined 8.1% and loans by prime lenders increased 0.7%, the study said.

A researcher for the nation's leading subprime trade group has confirmed what lenders have been talking about for months -- that profit margins in the niche are falling.Discussing his new study on subprime lending in New Jersey, Professor Richard DeMong of the University of Virginia noted that margins are "clearly" falling, saying one reason for the decline is that more lenders are flooding into the niche. At a Sept. 15 legislative conference sponsored by the National Home Equity Mortgage Association, Mr. DeMong said New Jersey's predatory-lending law (first enacted in 2002) has caused subprime lending to drop "significantly" in the state -- particularly first liens. The study, based on first-quarter results and sponsored by NHEMA, confirms the findings of two previous studies on how the Home Ownership Security Act reduced subprime lending in the state. NHEMA attorney Wright Andrews conceded that the group may have a credibility problem in Washington because even though "we keep saying the sky is falling," loan volumes keep going up. NHEMA is trying to combat this perception and believes its members (particularly national lenders) are "cross-subsidizing" difficult markets by charging higher rates in states where nonconforming loan laws are less onerous.

LoanCity, an online wholesale lender based in San Jose, Calif., has announced enhancements to its line of alternative-A mortgage products.The enhancements include an 80/20 purchase option, streamlined documentation requirements, flexible qualifying options, and competitive pricing, the company said. "We're committed to offering the edge that brokers need to be profitable," said Rick Soukoulis, founder and chief executive officer of LoanCity. The company can be found on the Web at http://www.loancity.com.

Industry practices constitute barriers to homeownership for Hispanics, according to a study based on an 11-city focus group and released by the Congressional Hispanic Caucus Institute.Fellows from the CHCI's National Housing Initiative told a news conference that the industry should reform the way "frontline" mortgage sales agents are compensated by increasing monetary incentives for serving consumers who need more tailored assistance. They also recommended more-flexible underwriting and credit scoring standards. Ron Jauregui, one of the three NHI fellows, said the message to the mortgage industry is that corporate messages and innovative product development "must be consistent" with what happens on the front line. "Without a sincere understanding of the Hispanic consumers' experience and the trust factor that exists within it, neither the message nor the product will resonate," he said. The institute can be found online at http://www.chci.org.