Originations

Washington Real Estate Investment Trust, Rockville, Md., has priced $100 million of 5 1/4% 10-year senior unsecured notes at 99.985.The REIT said the proceeds will be used to repay borrowings under a term loan and lines of credit incurred in connection with recent property acquisitions. Credit Suisse First Boston and Banc One Capital Markets Inc. are the joint book-running managers of the offering. The REIT can be found online at http://www.writ.com.

A group of life insurance companies has released performance data for commercial mortgage loans based on an index that is the first benchmark for the private commercial mortgage market, according to the companies.The LifeComps index is based on actual historical data that enable investors to compare their commercial mortgage loan performance with the market aggregate as well as that of other asset classes. The index was created in 1996 by The Equitable, John Hancock, Northwestern Mutual, Principal Financial, and Prudential Insurance Co., and started collecting data from participants in 1997, the companies said. Since then, Allstate LIC, Connecticut General, and Guardian Life have also elected to participate in the survey. For the third quarter, the index showed a total return of 0.581%. Tom Jensen, a senior portfolio manager at Allstate and chairman of LifeComps, said the index "provides a long-term benchmark that will allow the commercial mortgage asset class to mature and be better understood by investors in commercial mortgage whole loans."

Richard A. Kraemer has been elected chairman of the board of Saxon Capital Inc., a residential mortgage lender and servicer based in Glen Allen, Va.Saxon said the move followed the board's acceptance of Edward G. Harshfield's resignation as chairman "as a result of increased responsibilities in other business activities." Mr. Harshfield will continue as a board member. Mr. Kraemer has been vice chairman of Saxon's board since 2001 and chairs its Audit Committee. The company can be found online at http://www.saxoncapitalinc.com

The Bond Market Association is predicting strong home sales and rising mortgage interest rates in 2004.Members of TBMA's economic advisory committee expect that the 30-year mortgage rate will rise to 6.65% by year-end 2003 and that the rate on the 10-year Treasury note will be 5.10%. With strong economic growth averaging 4.2% next year, TBMA is forecasting that home sales will match the 2002 total, but fall short of this year's record-setting pace, which the association estimates could total 7.2 million by Dec. 31. "Though we would expect less of a boost from mortgage refinancing activity in the coming year, based on the panel's medium forecast, total home sales -- both new and existing -- are expected to top the 6.6 million-unit total of 2002," the TBMA forecast says. The association can be found online at http://www.bondmarkets.com.

Washington Mutual has lowered its earnings guidance for this year and next in light of projected lower mortgage loan volume, the company said Tuesday morning.The company said it now expects 2003 earnings per share in the range of $4.15 to $4.25, down from a previous estimate of $4.33 and a Thomson First Call analysts' consensus estimate of $4.42. WaMu said it expects 2004 EPS to be in a range of $4.30 to $4.80, compared with previous guidance of $4.70 to $4.80. The revised guidance rattled stocks across the mortgage market Tuesday morning, with WaMu's stock falling about 8% in value by 1 p.m. WaMu also cited "increasingly competitive pricing" as a factor in the decision to reduce earnings guidance. WaMu chairman and chief executive officer Kerry Killinger said WaMu is "taking steps to substantially reduce operating costs" in response to the changing market conditions.

New York-based iStar Financial, a real estate investment trust, has announced that it has increased its previously reported offering of senior notes from $250 million to $500 million and agreed to pricing terms for the offering.The company said it has agreed to issue $350 million of 6.0% senior notes due 2010 and $150 million of 6.5% senior notes due 2013. The seven-year notes were priced at 99.436, and the 10-year notes were priced at 99.275. The offering is being led by Deutsche Bank Securities Inc. as sole book-running lead manager and Banc of America Securities LLC as co-lead manager. The REIT can be found online at http://www.istarfinancial.com.

Imperial Capital Bank, La Jolla, Calif., is opening a flagship branch in downtown San Diego and expanding its Imperial Capital Express division into Phoenix, Atlanta, and Austin, Texas.The San Diego branch will provide commercial and multifamily real estate loans to downtown San Diego businesses and area residents. ICB, a subsidiary of ITLA Capital, is closing down another San Diego branch in January 2004, the bank said. The new ICB offices are expected to expand the marketing of the company's loan products across the "sunbelt states," including Arizona, New Mexico, Texas, the Carolinas, Georgia, and Florida. The division specializes in multifamily real estate loans up to $2 million and started its operations in Santa Monica, Calif., in April 2002.

Freddie Mac has partnered with The Wilmington Housing Authority of Delaware and other local nonprofits, pledging to purchase up to $50 million in eligible mortgages for low- to moderate-income Wilmington families.The initiative plans to provide a supply of about 500 affordable for-sale homes through both new construction and rehabilitation efforts in targeted areas of the city. Products offered include HOPE IV and the Department of Housing and Urban Development's 5(h) program, which had not been available to local residents in the past. The partnership is "a focused, comprehensive effort to deploy some of the most effective state and federal housing initiatives now available, beginning with HUD's Housing Choice Vouchers," said Dave Stevens, Freddie Mac's senior vice president of mortgage sourcing, operations, and funding. Freddie's "community gold mortgage" program will assist city borrowers and housing voucher holders who want to become homebuyers, provided they earn at least $18,500 a year and can cover a downpayment equal to 2% of the home's purchase price. Combined city and state funds will offer individual grants of up to $10,000 in downpayment and closing costs.

Freddie Mac, which has been besieged by an accounting scandal since midyear, has named the former president of the Federal Reserve Bank of Boston, Richard F. Syron, as it new chairman and chief executive.Mr. Syron, who also headed the American Stock Exchange for five years, is the board's pick to lead the secondary-market giant out of the dark days of a scandal that has hammered its reputation, employee morale, and investor confidence. "Freddie Mac is a great company with an important public mission to help make homeownership more affordable for American families," Mr. Syron said in a statement. "I am a strong believer in that mission." Mr. Syron joins the company from the publicly traded Thermo Electron Corp., Waltham, Mass., a manufacturer of high-tech equipment. But Mr. Syron is best known in the mortgage and financial services industries for the years he spent at the Boston Fed (1989 to 1994). It was during this period that banks -- and the New England economy in particular -- were in bad financial shape. In its Dec. 8 issue, National Mortgage News reported that there were two final candidates for CEO: Roger Haughton, CEO of the PMI Group, and an unknown. NMN went to press last Thursday. Freddie made its announcement concerning Mr. Syron Sunday afternoon.

Arlington Hospitality Inc., a hotel development and management company based in Arlington Heights, Ill., has announced the recent completion of a 1-for-100 reverse stock split, followed by a 100-for-1 forward split.The reverse/forward split will enable the company to completely redeem, for $3.83 per share in cash, the shares of common stock owned by stockholders holding less than 100 shares on the Nov. 28 effective date, Arlington said. The company said it expects to purchase 35,000 shares from approximately 900 stockholders. The reverse/forward split is aimed at "reducing the company's administrative costs and allowing holders of less than 100 of the company's shares to receive cash for their shares without incurring transaction costs," Arlington said. The company can be found online at http://www.arlingtonhospitality.com.

Washington Real Estate Investment Trust, Rockville, Md., has announced a public offering of 2 million shares of its common stock.The REIT said it will grant the underwriters an option to buy up to 300,000 additional shares to cover any overallotments. Credit Suisse First Boston is expected to be the sole bookrunner and joint lead manager of the offering, with A. G. Edwards & Sons as the other lead manager. The REIT can be found online at http://www.writ.com.

The City of Indianapolis multifamily revenue bonds (Sunrise Apartment Project) have been downgraded from C to D by Fitch Ratings.The rating agency said the downgrade is based on the bond payment default as of the December 2003 distribution, reflecting the inability of the property to generate sufficient cash flow to service its principal and interest obligations. The bonds are secured by a mortgage loan on a 320-unit multifamily property in Indianapolis.

Vestin Group, a Las Vegas-based commercial mortgage lender and asset manager, has reported the resignation of Steve Byrne as chief operations officer and director of the company.The resignation is effective Nov. 30. Mr. Byrne has resigned to "pursue other interests," according to Vestin. Steve Stern of Stern & Co., Vestin's public relations representative, said Vestin is not looking for a successor at the moment, but will be "at some point." He declined to comment further.

Richard Karl Goeltz, a former vice chairman and chief financial officer of American Express Corp., has been elected to the board of directors of Freddie Mac.Before joining American Express, Mr. Goeltz was group CFO and a member of the board of National Westminster Bank and executive vice president for finance and CFO at The Seagram Co. Ltd., Freddie Mac said. He is a former member of the Financial Accounting Standards Board Advisory Council and of the United Kingdom's Accounting Standards Board.

Stewart Title Co., Houston, has announced the acquisition of Lake County Abstract Co., Leadville, Colo.The terms of the transaction were not disclosed. Stewart, a wholly owned subsidiary of Stewart Information Services Corp., said key management and staff will remain with the company. "This is a strategic acquisition for Stewart, completing our coverage of markets in the central Colorado mountain region," said Rand Zimmerman, group president of Stewart Title. The parent company can be found on the Web at http://www.stewart.com.

Freddie Mac has announced that it will not invest in subprime mortgages originated on or after Aug. 1, 2004, that contain mandatory arbitration clauses.The government-sponsored enterprise said the policy is aligned with its existing prohibition on the use of mandatory arbitration for prime mortgage investments, and touted its status as the first secondary-market investor to adopt such a stance. "Freddie Mac believes that all homeowners should be able to voluntarily choose the mortgage dispute resolution option they believe to be in their best interests," said Paul Peterson, Freddie Mac's chief operating officer. The GSE said some lenders have improved consumer protections when using mandatory arbitration clauses, but added that practices in the subprime market are uneven. "As a result, there exists the greater likelihood that borrowers may be unaware that they are agreeing to be bound by this dispute resolution mechanism," Freddie Mac said. The Department of Housing and Urban Development and the Federal Trade Commission have recommended banning mandatory arbitration agreements under the Home Ownership and Equity Protection Act and for high-cost home loans, the company said. Freddie Mac owns about $13 billion in subprime loans in its retained portfolio. The GSE can be found online at http://www.freddiemac.com.

Mortgage lenders reduced their payrolls in October for the second consecutive month -- this time by 4,700 full-time employees -- as demand for refinancings fell dramatically.The Bureau of Labor Statistics data released Friday show that employment in the mortgage banker/broker sector fell from 421,400 in September to 416,700 in October. The interest rate on the 30-year fixed-rate mortgage stayed below 6% in October. However, origination volume was off by 30%-50% during some weeks in October (compared with that of the same weeks a year earlier). Meanwhile, the November job report for the economy as a whole disappointed many who expected to see a real boost in hiring. Only 57,000 new jobs were created in November, compared with 126,000 in October. (There is a one-month lag in mortgage employment data due to changes the Labor Department made to its employment report earlier this year.) The BLS can be found online at http://stats.bls.gov.

SL Green Realty Corp., New York, has priced a public offering of 5.6 million shares of 7.625% series C cumulative redeemable preferred stock.The shares have a liquidation preference of $25 per share and will be redeemable at par at the option of the company on or after Dec. 12, 2008, the company said. The underwriters have been granted a 30-day option to buy up to 840,000 additional shares of the stock to cover any overallotments. Wachovia Securities was the sole book-running manager for the offering. SL Green is a real estate investment trust that specializes in acquiring, owning, and managing office properties in Manhattan. It can be found online at http://www.slgreen.com.

New York-based iStar Financial, a real estate investment trust, has announced a $250 million offering of seven-year senior notes.The offering is being led by Deutsche Bank Securities Inc. as sole book-running lead manager and Banc of America Securities LLC as co-lead manager. The REIT can be found online at http://www.istarfinancial.com.

An additional $100 million of lending to low- and moderate-income families for affordable housing has been made available in Los Angeles and Orange counties by two California housing finance agencies.The "historic" agreement was announced by the California Housing Finance Agency (the state's affordable housing bank) and the Southern California Home Financing Authority (the state's largest local user of single-family mortgage revenue bonds). "For too long, working families have been squeezed out of the Southern California housing market because their income was either too low or too high to qualify for first-time homebuyer loans at below-market interest rates," said Theresa Parker, executive director of CalHFA. "This unique partnership between our two entities will allow income limits to be adjusted and interest rates lowered, thereby expanding the sphere of affordable housing within their reach." CalHFA can be found online at http://www.calhfa.ca.gov.