Originations

The average 30-year fixed mortgage rate dropped to 6.16% for the week ending Sept. 5 from 6.44% the previous week, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate fell from 5.77% to 5.46%, and the average rate for one-year Treasury-indexed adjustable-rate mortgages declined from 3.98% to 3.87%. Fees and points averaged 0.6 points for all three mortgage categories. "The release of the August jobs report showed a continuation of the jobless recovery, which served to stem some of the enthusiasm in the Treasury bond market," said Frank Nothaft, Freddie Mac's chief economist. "This, of course, caused interest rates, including mortgage rates, to ease back from the highest level we had seen in a year." Mr. Nothaft also pointed to 15.7% annualized growth in single-family mortgage debt outstanding in the second quarter as "one more sign" that the second quarter was a "record period" for the housing industry. A year ago, the average 30-year and 15-year fixed rates were 6.18% and 5.59%, respectively, and the average one-year ARM rate was 4.32%, Freddie Mac said. Freddie Mac can be found online at http://www.freddiemac.com.

Warburg, Pincus Equity Partners LP and certain affiliates have agreed to sell all Price Legacy Corp. securities held by them to The Price Group LLC or its assignees, according to Price Legacy, a San Diego-based real estate investment trust.Price Legacy said the securities include approximately 18 million shares of series B preferred stock, 5.0 million shares of common stock, and warrants to purchase 2.5 million shares of common stock. The shopping center REIT said The Price Group, a significant stockholder in Price Legacy, intends to assign the contractual right to buy Warburg's securities to third parties in a manner that ensures that the ownership will comply with the REIT ownership limits in Price Legacy's charter. The REIT can be found online at http://www.pricelegacy.com.

Sovran Self Storage, Buffalo, N.Y., has entered into financing arrangements that will give the self-storage real estate investment trust access to up to $300 million in senior unsecured debt.Initial funding of $209 million was used to repay a part of Sovran's term and line of credit loans, the REIT said. The rest of the funding will be used to fund acquisitions and for general corporate purposes. Fleet Securities is the lead arranger on the financing, which includes a $100 million private placement of 10-year notes, a $100 million five-year term loan, and a $75 million line of credit (which can be expanded to $100 million). Interest is fixed at 6.26% on $80 million of the 10-year term notes, and at the London interbank offered rate plus 1.5% for the remaining $20 million. The $100 million five-year term note bears interest at LIBOR plus 1.5%, and the revolving credit facility carries interest at LIBOR plus 1.375%.

The seasonally adjusted rate of Canadian housing starts was 233,900 in August, up from 223,500 in July, according to the Canada Mortgage and Housing Corp."Year-to-date, actual starts have exceeded last year's level of 4.7%," said Bob Dugan, chief economist at the CMHC. The agency can be found on the Web at http://www.cmhc.ca.

Two classes of notes issued by Ingress I Ltd., a static-pool collateralized debt obligation backed in part by mortgage-related securities, have been downgraded by Moody's Investors Service.The downgrades were as follows: Class B Second Priority Fixed Rate Term Notes Due 2040, from Aa2 to Aa3; and Class C Third Priority Fixed Rate Notes Due 2040, from A3 to Ba3. Both classes remain on watch for possible downgrade. Moody's said the actions were necessary to ensure that the ratings "accurately reflect the risk of expected losses from the underlying collateral pool, which has continued to deteriorate in credit quality since the last rating action on the affected notes." The CDO is supported by asset-backed securities, commercial mortgage-backed securities, and real estate investment trust securities.

American Home Mortgage Inc., Melville, N.Y., has announced the hiring of approximately 325 employees who formerly worked at the now-defunct Capital Commerce Mortgage, Sacramento, Calif.The new employees, including 13 production center managers, will become the Western region of American Home's wholesale channel, which operates as American Brokers Conduit, the company said. They will operate from 15 branches, mainly in California and other Western states. Al Crisanty, who managed sales for the group at Capital Commerce (which ceased operations in August), has been named senior vice president for wholesale originations. The company said the new group is expected to add significantly to American Home's 2004 loan production, but at lower gross and net margins than its retail loan production businesses. The company can be found on the Web at http://www.americanhm.com.

The Market Composite Index, an overall measure of mortgage applications, rose to 771.8 on a seasonally adjusted basis during the week ended Sept. 5 from 628.7 the week before, as the Refinance Index jumped more than 45%, according to the Mortgage Bankers Association of America's Weekly Mortgage Applications Survey.On an unadjusted basis, applications were up 2.9% on the week but down 37.7% from the level recorded a year earlier. On a seasonally adjusted basis, the Purchase Index increased from 396.1 to 408.8, and the Refinance Index jumped from 1981.5 to 2883.6. "With mortgage rates decreasing for the first time in over two months, consumers are taking advantage of a dip in interest rates," said MBA chief economist Doug Duncan. "The rise to a 55% share of applications for refinances from 46% the previous week shows consumer attention to possibly the final opportunity to capture a temporary rate drop in a rising rate environment. While the percentage increase in the indexed level of activity was large, this week's Refinance Index level was less than one-third of the level experienced at the height of the boom in early June." The average contract interest rate for 30-year fixed-rate mortgages fell from 6.25% to 5.99%, and points (including the origination fee) increased from 1.27 to 1.41 for loans with 80% loan-to-value ratios, the MBA reported. The MBA can be found online at http://www.mbaa.org.

Standard & Poor's has announced that it is now including commercial mortgage-backed securities pricing in its Conquest pricing service.The financial information services company said it will provide evaluations "that are directly related to market activity for liquid securities and a proven methodology to compare illiquid securities to the active market." S&P said it also expects to provide CMBS customers "with prices that have no potential bias inherent in owning or selling securities." S&P analysts will be available to discuss the prices. The company's proprietary Conquest technology analyzes call protection, loan prepayment rates, loan defaults, default recovery rates, and cash flow distribution to ascertain bond prices.

Kimco Realty Corp., New Hyde Park, N.Y., has announced a public offering of 2.4 million shares of its common stock.The net proceeds will be used to invest equity capital in Kimco's co-investment programs, for property acquisitions, and for general corporate purposes, the company said. Banc of America Securities LLC is the sole book-running underwriter for the offering. Kimco, a real estate investment trust specializing in shopping centers, has granted the underwriter an option to buy up to 360,000 additional shares of common stock to cover any overallotments. The REIT can be found online at http://www.kimcorealty.com.

The American Land Title Association has reported that gross revenues for the title industry totaled $7.49 billion for the first six months of this year, up 36.5% from the same period in 2002, which was a record year for the industry.The loss ratio (losses and loss-adjustment expenses as a percentage of total operating income) fell to 3.64% from 4.24% for the first half of 2002. The level of pretax profit for the period surged to $454 million, compared with $156.1 million last year, which ALTA said reflects the strength of the market and the fact that costs have increased less than revenues. On an after-tax basis, including investment income, title insurers earned $436.2 million, compared with $227.7 million a year earlier. ALTA can be found on the Web at http://www.alta.org.

New Century Financial Corp., Irvine, Calif., has established a $2 billion asset-backed extendable short-term note facility.The facility will be used by the subprime mortgage banker to fund loan production and to aggregate loans pending sale, the company said. The notes connected with the facility will be issued in private offerings and thus will not be registered under the Securities Act of 1933. They will not be sold in the United States absent registration or exemption. New Century can be found online at http://www.ncen.com.

The ratings on three classes of Morgan Stanley Capital I Inc.'s commercial mortgage pass-through certificates, series 1998-CF1, have been lowered by Standard & Poor's Ratings Services.The downgrades were as follows: class C, from A to BBB; class D, from BB-plus to B; and class E, from BB to CCC. Classes D and E were removed from CreditWatch with negative implications, and the ratings on five other classes in the deal were affirmed. S&P attributed the downgrades to expected losses on the numerous delinquent and specially serviced mortgages, $14.1 million in accrued interest shortfalls, and expectations that the shortfalls will continue until the resolution of real estate owned health care assets. In addition, the master servicer, GMAC Commercial Mortgage Corp., has $16.1 million in outstanding advances to the trust, the rating agency said. S&P can be found on the Web at http://www.standardandpoors.com.

Four classes of Deutsche Mortgage & Asset Receiving Corp.'s commercial mortgage pass-through certificates, series 1998-C1, have been downgraded by Fitch Ratings.The downgrades were as follows: class H, from BB-minus to B-plus; class J, from B-plus to B-minus; class K, from B-minus to CCC; and class L, from CC to C. The rating agency also placed classes G, H, and J on Rating Watch Negative, and affirmed the ratings on eight other classes in the deal. "The rating actions reflect continuing deterioration in the pool's collateral performance and a high percentage of loans expected to incur losses, as well as the accumulating interest shortfalls," Fitch said. "The interest shortfalls caused by the appraisal reductions, nonrecoverable expenses, loan modifications, and special servicing fees have affected subordinate classes, and permanent impairment to classes L and M [not rated by Fitch] is likely." The rating agency can be found online at http://www.fitchratings.com.

Corporate real estate executives are "cautiously optimistic" about the economy, but are still "struggling to deal with a substantial inventory of excess space," according to a survey by Jones Lang LaSalle, an international property services firm headquartered in Chicago and London.In addition, new accounting rules on the impairment of excess space have "created additional hurdles" for CRE executives, the company said. "While the past couple of years have been difficult for CRE executives, some important lessons have been learned," said Richard McBlaine, the company's president for strategic consulting. "The next real estate cycle should see CRE executives putting greater emphasis on the flexibility of their portfolios." The survey found that 49% of respondents were either "highly optimistic" or "somewhat optimistic" about the economy, and that two-third expect to add space by 2005. Jones Lang LaSalle's website address is http://www.joneslanglasalle.com.

Michael Warner has been named president of Avizen Lending Solutions, Minneapolis, a mortgage broker and lender formerly known as American Summit.Mr. Warner replaces Michael McVay, the founder of the company, who will retain the roles of chairman and chief executive officer, Avizen said. Mr. Warner was formerly vice president of the company's mortgage and lending divisions. He will now head Avizen as well as WealthSpring Mortgage, the company's retail mortgage broker division.

The ratings on four securities from four unrelated transactions have been lowered by Standard & Poor's Ratings Services and placed on CreditWatch with negative implications due to their reliance on Royal Indemnity Co. insurance policies.The downgrades were as follows: series A of Banc of America Large Loan Inc. commercial mortgage pass-through certificates, series 2001-WBM, from BBB-plus to BBB-minus; class A-2 of CVS credit lease pass-through certificates, from BBB-plus to BBB-minus; Short Term Asset Receivables Trust net lease pass-through certificates, series BC 2000A, from BBB to BBB-minus; and North First Credit Lease Trust 2001-CTL1 credit lease-backed pass-through certificates, from BBB to BBB-minus. S&P said the ratings are dependent on the financial strength rating on Royal, which was lowered from BBB-plus to BBB-minus Sept. 5.

Workers earning the federal minimum wage must work the equivalent of nearly three full-time jobs to afford the typical two-bedroom apartment, according to new research.At the going rate of $791 a month for a standard two-bedroom unit, someone earning $5.15 hourly would have to work 118 hours a week to pay his rent, the study by the National Low Income Housing Coalition found. If he worked only 40 hours a week, he would have to make $15.21 an hour to put his family in a two-bedroom rental, the study said. NLIHC president Sheila Crowley called the situation "appalling." She warned that if it isn't corrected, the first step on the ladder to homeownership will no longer exist for the majority, relegating them to a life of substandard housing, living with their parents, or doubling and even tripling up with others who are in the same boat. "Eventually, the number of people who succeed as renters will be so small that the pool of potential homeowners will evaporate," Ms. Crowley said. "There will be two distinct classes of people -- homeowners and everyone else." The now annual "Out of Reach" study found that renters in 66% of the nation's 356 metropolitan statistical areas must earn a "housing wage" of at least twice the prevailing federal minimum.

Zan Hamilton, a former investment banker who joined California lender Platinum Capital Group back in April, parted ways with the company last week, MortgageWire has learned.Mark Moses, Platinum's chief executive, called Mr. Hamilton "a nice guy," but said "we mutually agreed to part ways." Mr. Hamilton, a former Credit Suisse First Boston executive vice president, could not be reached for comment by MW's deadline. He was with the top-100 lender less than five months. Platinum, based in Irvine, Calif., quickly named mortgage industry veteran Pete Levasseur as its new president and chief operating officer. According to Platinum, Mr. Levasseur has 30-plus years' experience in the mortgage industry. During his career, he has worked for ITT Diversified Financial and Amresco. His most recent position was executive vice president of Metrociti Mortgage Corp.

United Dominion Realty Trust Inc., Richmond, Va., has announced a public offering of 4 million shares of its common stock.The proceeds of the offering will be used to fund future acquisitions and for other general corporate purposes, but in the meantime they will be used to reduce outstanding variable-rate debt under unsecured credit facilities, United Dominion said. The company said it has granted the underwriter, Wachovia Securities, an option to buy up to 600,000 additional shares to cover any overallotments. United Dominion, a multifamily real estate investment trust, can be found online at http://www.udrt.com.

Hospitality Properties Trust, Newton, Mass., has announced the sale of $125 million of 6.75% senior notes due Feb. 15, 2013.The real estate investment trust said the notes are expected to constitute an additional issuance of the 6.75% senior notes (due in 2013) sold earlier this year, and will be traded under the same CUSIP number. UBS Securities LLC was the underwriter of the notes. The hotel REIT can be found on the Internet at http://www.hptreit.com.