Los Angeles – July 31, 2018 – According to CBRE’s Q2 2018 U.S. Lending Figures reports, although lower loan maturity volumes have resulted in less originations this year, the commercial mortgage market remains in good shape overall. With an additional short-term policy rate increase by the Federal Reserve in June, the yield curve has continued to flatten. As of mid-July, the spread between 10-year and two-year Treasury bonds was only 25 bps—the tightest level since before the 2008 recession, when the yield curve inverted. Q2 lending volume, as measured by the CBRE Lending Momentum Index, was even with Q1 levels. Compared to a year ago, however, the index is down 10.6%. Agency multifamily lending is quite active. Year-to-date through May, combined Fannie Mae and Freddie Mac multifamily loan purchase volume totaled $43 billion, not far off the record-setting pace of $44.6 billion for the same period in 2017. Overall debt service coverage and LTV ratios in Q2 were consistent with the prior quarter. The percentage of loans carrying interest-only terms was 61%, down 5 percentage points from Q1. According to CBRE, there has been no substantial deterioration in loan underwriting measures over the past several quarters.
Hartford, CT, July 10, 2018 – Nassau Re launched an expanded website today at nsre.com, incorporating all of the consumer and agent resources previously found on Phoenix’s website, nsre.com/phoenix. The consolidated website is an early step in the company’s move to grow under the Nassau Re brand. In the coming months, more sales and service materials will begin to carry the Nassau Re name.
Los Angeles – June 30, 2018 – Life insurance companies and pension funds, as part of their overall investment portfolios, hold $475 billion in commercial and multifamily mortgage debt, accounting for 15 percent of the total outstanding. In 2017, life companies lent $80 billion in commercial and multifamily mortgages – a new record and four percent above 2016 levels – growing their portfolios by $40 billion or 9 percent. The long-term nature of commercial and multifamily loans matches well with the long-term nature of many of the liabilities off these companies. And like other capital sources, commercial and multifamily mortgages have performed extremely well for life companies. For most of the past decade-and-a-half, 60+ day delinquency rates have been below 10 basis points. At the end of 2017, just .03 percent of the balance of loans held by life companies were delinquent – 17 out of 33,236 loans.
Michael Zanta, assistant vice president and product delivery manager, talks about pursuing LOMA’s Fellow, Secure Retirement Institute (FSRI) professional designation in LOMA’s monthly magazine.
LOMA, an international trade association for the insurance and financial services industry, launched the FSRI professional designation program in 2013 to support the growing retirement planning and income marketplace.
Zanta said, “The FSRI designation program provided me with a solid understanding of the pillars that support retirement programs in the United States, as well as the opportunities that exist to make these programs more sustainable.”
He added, “… All companies need to think innovatively to provide the products our clients need in the ever-changing retirement environment.”
Los Angeles – May 31, 2018 -Interest rates for commercial mortgage debt have increased over the past two years given the 1.00% rise in the 10-year treasury over that time period. But, that’s not the whole story. The spread over treasuries for new loans has compressed, the average loan constant has decreased, and the debt level per dollar of NOI has also increased (lower debt yields). Assuming a 65% LTV 10-year loan, increases in overall interest rates range from .20%-.60% depending upon the capital source. CorAmerica’s matrix spread has declined by .40% with a net increase in overall rate of .60%. Agency spreads for the same term and LTV have declined .54% with a net change in overall rate of .44%.