Originations

RAIT Investment Trust, Philadelphia, has reported net income of $47.2 million for 2003, an 8.5% increase from $43.5 million in 2002.For the fourth quarter, RAIT reported net income of $13.5 million ($0.60 per share), a 15.4% increase from $11.7 million ($0.63 per share) a year earlier. Revenues for the fourth quarter totaled $21.4 million, representing a 5.9% increase from $20.2 million a year earlier, RAIT said. The real estate investment trust, which invests in commercial real estate, can be found online at http://www.raitinvestmenttrust.com.

New Century Financial Corp., Irvine, Calif., has reported record net earnings of $245.5 million ($6.56 per share) for 2003, compared with $179.7 million ($4.62 per share) the year before.For the fourth quarter, the company reported record earnings of $74.1 million ($2.00 per share), compared with $54.3 million ($1.43 per share) a year earlier. Robert K. Cole, New Century's chairman and chief executive, said the company has been evaluating the potential advantages and disadvantages of converting into a real estate investment trust. "In order to assist us, we are finalizing the engagement of a financial adviser," he said. "We expect to conclude our analysis within the next 75 days." New Century can be found online at http://www.ncen.com.

Radian Group Inc., Philadelphia, has reported net income of $385.9 million ($4.08 per share) in 2003, down from $427.2 million ($4.41 per share) in 2002.For the fourth quarter, Radian reported earnings of $55.5 million ($0.58 per share), down from $107.8 million ($1.14 per share) a year earlier. The company's fourth-quarter results were hurt by two separate charges, the largest being a $62 million ($0.66 per share) charge related to additions to loss reserves in anticipation of claims from a manufactured housing loan transaction originated and serviced by Conseco Finance Corp., St. Paul, Minn. The other charge, $0.09 per share, covers the closing of RadianExpress.com Inc. Radian can be found online at http://www.radianmi.com.

A strengthening economy should boost demand and improve fundamentals for most real estate sectors this year, but the performance of real estate investments may not improve significantly, according to Prudential Real Estate Investors, Parsippany, N.J.PREI said it expects private, unleveraged real estate investments to produce average total returns of about 8% in 2004, most of which will come from property income. In its annual outlook report on the real estate markets, PREI said, however, that the rebound in the economy and the broader equities market will probably cause some capital to flow out of the real estate sector this year, especially if interest rates rise. "With the U.S. economy gaining momentum and encouraging signs that job growth will accelerate in the months ahead, real estate fundamentals should look better over the next 12 months," said Charles Lowrey, chief executive officer of PREI. "However, while that's good news for investors, real estate investment performance may not necessarily improve significantly this year, and could actually fall short of 2003's results." PREI can be found online at http://www.prudential.com/prei.

Ocean West Holding Corp., Tustin, Calif., has announced an agreement between its subsidiary Ocean West Enterprises and Freedom Mortgage Corp. of New Jersey under which Ocean West will manage a new division of Freedom Mortgage.The holding company said the agreement will enable both Ocean West and Freedom Mortgage to increase originations by using the latter's warehouse lines, in return for which Ocean West will split the net profits of the new division with Freedom Mortgage. Freedom Mortgage has approximately $240 million in warehouse lending capacity. Ocean West, a mortgage banking company, can be found online at http://www.oceanwest.com.

The average 30-year fixed mortgage rate fell to 5.64% for the week ending Jan. 23 from the previous week's 5.66%, another six-month low, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate fell from 4.97% to 4.95%, and the average rate for one-year Treasury-indexed adjustable-rate mortgages declined from 3.62% to 3.56%. Fees and points averaged 0.6 of a point for fixed-rate mortgages and 0.7 of a point for ARMs. "Mortgage rates remain low as the economy picks up steam, allowing families a chance to purchase a new home or refinance if they haven't yet," said Frank Nothaft, Freddie Mac's chief economist. "In 2003, single-family housing starts were at their highest annual average in 25 years, and average total home sales are expected to break new records." A year ago, the average 30-year and 15-year fixed rates were 5.91% and 5.31%, respectively, and the average one-year ARM rate was 3.93%, Freddie Mac said. Freddie Mac can be found online at http://www.freddiemac.com.

Simon Property Group Inc., Indianapolis, has reported the sale of $500 million of senior unsecured notes by its partnership subsidiary, Simon Property Group LP.The real estate investment trust said the two tranches consisted of $300 million of 3.75% notes due in 2009 and $200 million of 4.90% notes due in 2014. Merrill Lynch & Co and UBS Investment Bank are the joint book-running managers of the offering. The mall and shopping center REIT can be found on the Internet at http://www.simon.com.

American Insured Mortgage Investors LP Series 86 and Series 88 have announced that they expect to receive proceeds from the disposition of their remaining mortgages by the end of January, resulting in their liquidation.Both partnerships said they expect to declare a final liquidating distribution to unitholders in February and to dissolve and terminate in accordance with the terms of their amended partnership agreements.

Genworth Financial Inc., a subsidiary of GE that comprises virtually all its life and mortgage insurance businesses, has filed a registration statement with the Securities and Exchange Commission for an initial public offering of common stock.Fairfield, Conn.-based GE said it intends to divest its remaining interest in Genworth as soon as practicable, subject to market conditions. The parent company said it will use the proceeds of the IPO to invest in growth initiatives and to reduce "parent-support debt" at GE Capital. The joint lead managers and bookrunners for the IPO are Morgan Stanley and Goldman, Sachs & Co.

Stewart Mortgage Information, Houston, has introduced what it terms the first guaranteed, ready-to-fund home equity loan bundled services package.The guaranteed bundle, or HELP, allows lenders to provide more accurate cost estimates, SMI said. For one fixed price, HELP includes integrated mortgage origination and settlement services for home equity loans, such as a tri-merged credit report, upfront disclosures, a deed report, and closing documents. It provides immediate access to products needed to prequalify a home equity transaction and allows the process to be stopped before incurring the cost of a full HELP bundle, SMI said. "We are so confident in our service offering that we guarantee delivery within 15 days," said Don O'Neill, SMI's chief executive officer. HELP can be ordered through RealEC, an electronic exchange for mortgage originators, real estate professionals, and settlement services providers. Stewart Mortgage Information is a wholly owned subsidiary of Stewart Information Services Corp., which can be found online at http://www.stewart.com.

Wachovia Securities, Charlotte, N.C., has created a real estate services group and named Leslie Fairbanks to head the unit.Wachovia said the new unit will include its commercial real estate services group, which services a portfolio of commercial mortgages and commercial mortgage-backed securities; a tax credit investment asset management group; and an asset and portfolio management group that handles special servicing assignments. Ms. Fairbanks will report to Bill Green, head of Wachovia's real estate capital markets unit. "Mortgage servicing and tax credit investment asset management are core businesses in our commercial real estate finance platform, and aligning these businesses is part of a natural evolution," Mr. Green said. Ms. Fairbanks was previously a managing director in Wachovia's structured finance group, the company said. In a related development, Alan Kronovet has been named head of Wachovia's commercial real estate services group.

Fannie Mae reported net income of about $7.90 billion for 2003, up 71.1% from that of the year previous. Diluted earnings per share were up 75%, to $7.91.However, Fannie Mae prefers to measure its "core business earnings," which differ from the net income measure prescribed under generally accepted accounting principles. Core earnings were up 14.3% to approximately $7.31 billion for the year and up 5.9% to $1.77 billion for the fourth quarter. Core earnings per share were up 15.7%, at $7.29 per share, for the year and up 6.6% to $1.66 for the quarter. Net interest income for the year totaled about $13.57 billion, up 28.4%, and guaranty fee income totaled approximately $2.41 billion, up 32.7%, Fannie Mae reported. Meanwhile, credit-related expenses rose to $111.6 million from $91.7 million in 2003, and the government-sponsored enterprise reported losses of about $2.26 billion from the call and repurchase of debt, compared with $710.5 million in 2002. Chairman and chief executive officer Franklin Raines touted the results. "Fannie Mae delivered outstanding business results in 2003, capitalizing on opportunities and meeting significant challenges posed by a year of historic refinance and purchase volumes and volatility in our market," he said. Fannie Mae can be found online at http://www.fanniemae.com

Washington Mutual has reported earnings of $3.88 billion ($4.21 per share) for 2003, up from $3.86 billion ($4.02 per share) the year before.Home loan volume set a record of $384.18 billion for the year, up from $279.45 billion in 2002. However, fourth-quarter volume dropped $42.28 billion, falling from $99.81 billion in the fourth quarter of 2002 to $57.53 billion, the company said. Earnings fell in the fourth quarter, totaling $842 million ($0.93 per share), compared with $941 million ($1.00 per share) a year earlier. "Even though the market remains predominantly a fixed-rate market, the company is beginning to see a shift toward adjustable-rate mortgages," WaMu said. ARMs represented 55% of WaMu's home loan application volume in the fourth quarter, compared with 38% in the third quarter, the company said.

Washington Mutual Inc., Seattle, eliminated the equivalent of 4,500 jobs from its home loans group in the fourth quarter, and more cuts are on the way, a company executive said on a conference call to discuss fourth-quarter results (see item below).Chief administrative officer Craig Chapman said an additional 1,800 workers have been notified that their positions will likely be eliminated in the first quarter of this year. He said lowering the company's head count is "necessary and integral" to WaMu's ambitious plan to reduce its cost structure by $1 billion. WaMu can be found online at http://www.wamu.com.

Purchase applications set a record high and refinance applications soared during the week ended Jan. 16 as the Market Composite Index, an overall measure of mortgage applications, surged from 702.6 to 916.1 on a seasonally adjusted basis, according to the Mortgage Bankers Association's Weekly Mortgage Applications Survey.On an unadjusted basis, applications rose 35.7% on the week, but they were down 19.6% from the level of a year earlier. The Purchase Index rose from 445.9 to 501.6 on a seasonally adjusted basis, while the Refinance Index soared from 2195.7 to 3327.3. "Spurred by mortgage rates below 6%, the Purchase Index reached a record high and the Refinance Index increased by over 51% last week," said Jay Brinkmann, the MBA's vice president of research and economics. "The Refinance Index increase marks the highest week-to-week percent[age] increase since the week ending Jan. 12, 2001." Refinancings represented 57.7% of total applications, up from 51.6% the previous week, while adjustable-rate mortgages accounted for 27.8%. The average contract interest rate for 30-year fixed-rate mortgages dipped from 5.56% to 5.55%, and points (including the origination fee) decreased from 1.38 to 1.32 for loans with 80% loan-to-value ratios, the MBA reported. The MBA can be found online at http://www.mortgagebankers.org.

Single-family housing starts fell by 0.6% in December, but 2003 will still go down in the record book by topping a construction record that dates back to 1977.The Census Bureau reported that single-family starts fell from a seasonally adjusted annual rate of 1.67 million in November to 1.66 million in December. For the year, builders broke ground on 1.50 million new homes, topping the previous record of 1.45 million set 26 years ago. A month ago, National Association of Home Builders forecasters said they expected 2004 to be another good year, but unlikely to exceed 2003. However, NAHB economists say they now believe that the Federal Reserve will keep interest rates low until November and that it could be another record year.

Post Properties Inc., Atlanta, has announced the closing of a $350 million unsecured revolving line of credit with a nine-bank syndicate.The three-year facility, representing a $30 million increase in the company's borrowing capacity, bears an interest rate of 90 basis points over the London interbank offered rate. Wachovia Capital Markets was the lead arranger of the facility. Post is a real estate investment trust that specializes in luxury apartment communities. It can be found online at http://www.postproperties.com.

NovaStar Financial Inc., Kansas City, Mo., has priced a public offering of 2.6 million shares of 8.90% series C cumulative redeemable perpetual preferred stock.The shares have a liquidation value of $25 per share. The lead manager of the offering is Friedman, Billings, Ramsey & Co. NovaStar said it has granted the underwriters a 30-day option to buy up to an additional 390,000 shares to cover any overallotments. The company, a real estate investment trust, can be found online at http://www.novastaris.com.

Nationwide Health Properties Inc., Newport Beach, Calif., has priced a public offering of 6.5 million shares of common stock at $19.73 per share.NHP, a real estate investment trust, said the underwriters have been granted a 30-day option to buy up to 975,000 additional shares to cover any overallotments. UBS Investment Bank and J.P. Morgan Securities Inc. are the joint book-running managers for the offering. The REIT can be found on the Web at http://www.nhp-reit.com.

Taubman Centers, Bloomfield Hills, Mich., has completed a $347.5 million commercial mortgage-backed securities financing on a Los Angeles shopping center.The retail real estate investment trust said the 10-year loan carries a 5.5% interest rate. The proceeds from the securitization were used to pay off the $146 million, 8.3% mortgage on the property and the company's lines of credit, Taubman said. "With the completion of this financing, 76% of our total debt is fixed at an average rate of 6.2%," said Robert S. Taubman, president and chief executive officer of Taubman Centers.