Originations

New Plan Excel Realty Trust, New York, and JPMorgan Fleming Asset Management have formed a joint venture to acquire "institutional grade" community and neighborhood shopping centers nationwide.New Plan said the two partners have made equity commitments totaling $150 million to the venture, NP/I&G Institutional Retail Co. The contribution is split 80% and 20% between a JP Morgan affiliate and New Plan. New Plan, a retail real estate investment trust, will be responsible for initiating acquisitions for the venture, and managing and leasing the properties. The venture has already made its first acquisition -- a 251,236-square-foot Lake Grove, N.Y., grocery-anchored community shopping center -- for approximately $44 million, New Plan said.

Meanwhile, the Office of Federal Housing Enterprise Oversight's House Price Index indicates that average home prices rose by 5.61% in the third quarter from the level recorded a year earlier, according to OFHEO.OFHEO's index also shows that price appreciation, based on resales and refinancings, accelerated from a 4.66% annual rate in the second quarter to a 5.56% annual rate in the third quarter. The second-quarter number was the lowest annualized rate of appreciation since the HPI registered 4.58% in the fourth quarter of 1999. OFHEO gets its pricing data from Fannie Mae and Freddie Mac. In general, the increase in house prices has slowed over the past four quarters from an 8.73% annual rate in the third quarter of 2002. "These numbers in our HPI report show a stabilization of prices, with continued strength in housing markets throughout most of the country," OFHEO Director Armando Falcon Jr. said. The National Association of Realtors recently reported that the national median existing-home price was $172,400 in October, up 8.2% from October 2002. OFHEO can be found online at http://www.ofheo.gov.

Home prices increased at an annualized rate of 4.8% nationwide in the third quarter, down slightly from a revised rate of 4.9% in the second quarter, according to the Conventional Mortgage Home Price Index released by Freddie Mac.The index showed that the Pacific states recorded the largest gains in home prices in the third quarter, rising at an annualized rate of 7.2%. The New England states followed with a 7.0% annualized growth rate, and the Middle Atlantic states of New York, New Jersey, and Pennsylvania finished third with a 6.4% growth rate. "Even with the rapid rise in mortgage rates that occurred in July, demand for home purchases stayed strong," said Any Crews Cutts, Freddie Mac's deputy chief economist. "However, continued job losses, particularly in the Midwest and Southern manufacturing states, stalled home price growth in those areas, causing the national average quarterly growth rate to come in below expectations for the quarter." The index was jointly developed by Freddie Mac and Fannie Mae and, unlike the OFHEO House Price Index (see item below), it is based on observations of actual sales prices or appraised values of the same homes over time, Freddie Mac said. Freddie Mac can be found online at http://www.freddiemac.com.

First Union Real Estate Equity and Mortgage Investments and FUR Investors LLC have announced a stock purchase agreement under which FUR will buy at least 5 million common shares from the real estate investment trust for $2.60 per share.As part of the transaction, FUR will commence a tender offer to buy up to 5 million common shares at $2.30 per share. If the tender offer is not fully subscribed, First Union said it will increase the number of shares to be issued to FUR by the amount of the deficiency, up to a maximum of 5,185,724 shares. As part of the transaction, Michael L. Ashner will become president and chief executive officer of First Union, and an affiliate of Mr. Ashner will provide asset management and general advisory services under an arm's-length agreement, the company said. Mr. Ashner is a real estate investor who controls FUR Investors.

The Eleventh Federal Home Loan District Cost of Funds Index for October stood at 1.909%, a decline of over 1 basis point from September's 1.923%.This was the third consecutive month that the index has been below the 2% mark, and once again it is at an all-time low. In October 2002, the index stood at 2.708%. For comparative purposes, the monthly average commitment rate for the one-year adjustable-rate mortgage (as reported by the Freddie Mac Primary Mortgage Market Survey) was 3.74% in October. For the same month in 2002, it was 4.27%. COFI is a lagging indicator, and it usually reflects changes in the market that took place three to six months ago. The ARM rate, according to the Freddie Mac survey, bottomed at 3.52% in June, before rising to 3.86% in September.

Total primary mortgage insurance written by the members of the Mortgage Insurance Cos. of America totaled $30.6 billion in October, down 16.5% from September's $36.7 billion.It was the eighth consecutive month in which the industry has written over $30 billion in primary new insurance. In October 2002, it wrote $27.6 billion. Since July 2003 the data reported by MICA do not include Radian Guaranty Inc., the Philadelphia-based company that is no longer a member of the trade group. By type, $22.3 billion of traditional mortgage insurance and $8.3 of bulk insurance was written in October. Application volume fell 2.4%, declining from 239,168 in September to 233,393 in October. This represents over 100,000 fewer applications than were received in June, when volume peaked at 334,385. New pool risk written in October totaled $636.2 million, up from $605.0 million in September. The cure/default ratio remained virtually unchanged from September, at 87.1%. There were 37,742 cures and 43,309 defaults in October. MICA can be found online at http://www.micanews.org.

Following up on its purchase of a minority stake in AMI Capital last year, Wachovia Bank, Charlotte, N.C., has acquired the remaining stake in the Bethesda, Md.-based multifamily lender and servicer.The terms of the deal were not disclosed. AMI originates and services multifamily mortgages through Fannie Mae's Delegated Underwriting and Servicing program and the Federal Housing Administration-insured lending program. The acquisition will enable Wachovia to qualify as one of 27 designated Fannie Mae DUS lenders in the multifamily financing area, according to Steve Jones, managing director for strategic investments in the Wachovia Real Estate Capital Markets group. "By acquiring full ownership of AMI, we are following through on a commitment to be a more meaningful player for multifamily clients nationwide, and to the commercial and multifamily servicing sector," Mr. Jones said. "We view DUS and agency lending as an important addition to Wachovia's product line."

CapitalSource, a Chevy Chase, Md.-based commercial finance firm that also funds real estate and health care properties through its health care finance and structured finance groups, has reported the securitization of $500 million of debt.The proceeds from the offering were used to repay borrowings under some of its credit facilities, the company said. This is the company's second securitization of "term debt" for 2003 and the financing will be recorded on its balance sheet, CapitalSource said. The notes are backed by a $500 million pool of senior and subordinated commercial loans, including loans backed by real estate and originated by the company. The interest rates on the different classes of the offering range from 40 basis points above the London interbank offered rate for the highest-quality loans to LIBOR plus 250 bps for the class D loans. CapitalSource has retained a 13.5% interest in the loan pool.

American Mortgage Network, San Diego, has announced the opening of a new regional center in the Dallas area to serve mortgage brokers in much of Texas and Arkansas.AmNet recently opened a regional center in Houston. The Dallas-area operation, located in Irving, will be headed by Nancy Snowden, who has 35 years of mortgage banking experience, AmNet said. "The residential housing market in the Dallas area is outperforming other segments of the economy," Ms. Snowden said. ".... Underwriting and closing will be handled through both the Dallas and Houston offices, while account executives will be located throughout the state to serve broker needs in specific geographic areas." AmNet, a wholly owned subsidiary of American Residential Investment Trust, can be found online at http://www.amnetmortgage.com.

Volt Inc., a power provider and marketer of alternative energy and financial services based in Oakhurst, Calif., has announced an agreement to purchase all the outstanding shares of Priority One Mortgage Corp., Milford, Pa., for an undisclosed amount of cash and preferred stock.Volt said Priority One's president, Scott Finley, and his staff would remain in their current capacities. The acquisition would enable the company to expand its financial services business in New Jersey and Pennsylvania "at the same time it is looking at energy and real estate projects in the region," Volt said. The company can be found on the Web at http://www.voltinc.com.

Oakwood Homes Corp., Greensboro, N.C., has announced an agreement under which it would be acquired by Clayton Homes Inc., Knoxville, Tenn., for approximately $373 million in cash, subject to certain adjustments.Oakwood, which filed for Chapter 11 bankruptcy protection on Nov. 15, 2002, said the purchase is expected to be accomplished through an amendment to the company's reorganization plan, which is pending in the U.S. Bankruptcy Court for the District of Delaware. "Although we were poised to emerge from Chapter 11 as a stand-alone company, after considering Clayton's offer, the board and the creditors' committee decided that the cash recovery provided by the Clayton offer was in the best interests of the financial stakeholders," said Myles E. Standish, Oakwood's chairman and chief executive officer. Clayton is a builder, retailer, and financer of manufactured homes. Oakwood, a major manufacturer and lender in the manufactured housing industry, can be found online at http://www.oakwoodhomes.com.

Spurred by a surge in refinance applications, the Market Composite Index, an overall measure of mortgage applications, jumped to 775.6 on a seasonally adjusted basis during the week ended Nov. 21 from 663.2 the week before, according to the Mortgage Bankers Association of America's Weekly Mortgage Applications Survey.On an unadjusted basis, applications were up 28.1% on the week and down 33.8% from the level of a year earlier. The Purchase Index rose from 425.9 to 459.9 on a seasonally adjusted basis, while the Refinance Index surged from 2043.9 to 2612.2. Refinancings represented 53.3% of total applications, up from 48.1% the previous week, while adjustable-rate mortgages accounted for 27.0%. The average contract interest rate for 30-year fixed-rate mortgages rose from 5.64% to 5.73%, and points (including the origination fee) fell from 1.54 to 1.45 for loans with 80% loan-to-value ratios, the MBA reported. The MBA can be found online at http://www.mbaa.org.

The average 30-year fixed mortgage rate rose to 5.89% for the week ending Nov. 28 from 5.83% the previous week, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate rose from 5.17% to 5.22%, and the average rate for one-year Treasury-indexed adjustable-rate mortgages climbed from 3.72% to 3.77%. Fees and points averaged 0.6 points for 30-year fixed-rate mortgages and 0.7 points for ARMs and 15-year FRMs. "Monetary and fiscal policy have given the economy plenty of room to take off, and it looks like it may finally be doing just that," said Frank Nothaft, Freddie Mac's chief economist. With no signs of rising inflation, mortgage rates are likely to remain at or near current levels, he said. A year ago, the average 30-year and 15-year fixed rates were 6.13% and 5.57%, respectively, and the average one-year ARM rate was 4.19%, Freddie Mac said. Freddie Mac can be found online at http://www.freddiemac.com.

New-home sales fell 3.5% in October but remained above the 1 million mark for the eighth consecutive month.The U.S. Census Bureau reported that sales of new single-family homes fell from a seasonally adjusted annual rate of 1.15 million in September to a 1.11 million rate in October. New-home sales are expected to hit a new record in 2003, easily beating last year's record of 973,000 sales. A survey of mortgage applications made during the week of Nov. 21 supports this forecast. The Mortgage Bankers Association reported that the number of applications for mortgages to purchase homes was only slightly below the record set last May.

After apparently agonizing over a rather paltry 3.4% increase in the conforming loan limit, Fannie Mae and Freddie Mac have raised their ceiling for single-family mortgage purchases to $333,700 for next year.The comparatively small, $11,000 increase is less than half the 7.33% hike put into effect at the beginning of 2003, when the limit was raised to $322,700. And it is only about a third of the 9.36% jump put into effect in 2002. The two government-sponsored enterprises had trouble with a change instituted in January in how the Federal Housing Finance Board determines the index on which the loan limits are based. But in the end, they decided to accept the board's determination that the average price of both new and existing houses increased only 3.4% between October 2002 and October 2003. Still, the higher ceiling on loans the GSEs can purchase for their own portfolios or bundle into securities for sale to investors will help upwards of 150,000 homebuyers save $38,700 over the life of a 30-year loan, according to Freddie Mac's estimates. The higher loan limit will also result in an increase in the Federal Housing Administration ceiling next year to roughly $290,733 in about three dozen high-cost markets and $160,200 nearly everywhere else.

BRE Properties Inc., San Francisco, has announced the adoption of a phased, one-year executive succession plan under which Frank C. McDowell, BRE's president and chief executive officer, will retire on Jan. 1, 2005.Constance B. Moore, BRE's executive vice president and chief operating officer, will succeed Mr. McDowell, who will serve as an executive consultant to the company and its board of directors after his retirement, which begins the second phase of the plan. In the first phase, effective Jan. 1, 2004, Mr. McDowell will assume the role of vice chairman and chief executive officer and Ms. Moore will become president and COO, assuming day-to-day operating responsibility, the company said. BRE, a real estate investment trust, can be found online at http://www.breproperties.com.

Household International Inc., the Association of Community Organizations for Reform Now, and a group of borrowers have announced a proposed settlement of a nationwide class-action lawsuit involving the mortgage lending practices of Household's two U.S. branch-based businesses.The core of the settlement with the two businesses, Household Finance Corp. and Beneficial Corp., is a foreclosure avoidance program that will provide relief to delinquent Household borrowers who are at risk of losing their homes, the announcement said. Components of the program include interest rate reductions, waivers of unpaid late charges, deferral of accrued unpaid interest, and principal reductions. In addition, Household has agreed to provide funding for ACORN-sponsored financial counseling and literacy programs over the next three years. "Household's performance on implementing the foreclosure avoidance program has been exceptional, and we are hopeful that our future work together will deliver enormous benefits to subprime borrowers," said ACORN president Maude Hurd. Household can be found online at http://www.household.com.

Independence Community Bank, Brooklyn, N.Y., is acquiring Staten Island, N.Y.-based Staten Island Bancorp in a $1.5 billion transaction, and Lehman Brothers is acquiring most of the assets of SIB Mortgage Corp. in connection with the merger.ICB is paying $23.88 per SIB share, which will make for an exchange ratio of 0.6232 ICB shares for each SIB share, according to ICB, and may vary with changes in the market price of ICB stock. The total consideration will include $369 million in cash and approximately 29 million ICB shares. The acquisition, expected to close in the second quarter of 2004, will create a $17 billion community bank with 116 bank branches. Approximately 60% of the combined bank's $9 billion portfolio will be in commercial loans. ICB said it expects the acquisition to provide: an avenue to expand the company's presence in the New Jersey, Brooklyn, and Staten Island markets; opportunities for cost savings and revenue growth; and increased funding for multifamily and commercial loan production. Alan H. Fishman, ICB's president and chief executive officer, will be president and CEO of the combined bank. And Harry P. Doherty, chairman and CEO of SIB, will be its vice chairman.

Citigroup will pay $1.25 billion to acquire the consumer lending unit of Washington Mutual.The Tampa, Fla.-based unit provides consumer installment and real estate loans from some 400 offices located mostly in smaller communities in the Southeastern and Southwestern United States. As of Sept. 30, the subsidiary had $4.1 billion of assets. WaMu chief executive officer Kerry Killinger said the sale of this business "at an attractive premium" will allow WaMu to use its capital for core growth businesses. He said the subsidiary's mostly smaller-market focus differed from the parent company's strategy of targeting larger urban and suburban markets. WaMu can be found online at http://www.wamu.com.

Existing-home sales fell 4.9% in October but remained above the 6 million mark for the fourth consecutive month.The National Association of Realtors reported that resales fell from a record seasonally adjusted annual rate of 6.68 million in September to 6.35 million in October. NAR chief economist David Lereah said the housing sector remains "very healthy," but that sales may have peaked and there may be a "modest dropoff in housing activity." Nevertheless, he said he expects existing-home sales to remain at about the 6 million rate in November and December. And the sales total for 2003 will be above 6 million, exceeding last year's record of 5.56 million. The NAR can be found on the Internet at http://realtor.org.