Commercial, Multi-Family Mortgages Totaling $119 Billion to Mature in 2013
Eight percent or $119.5 billion of the outstanding balance of commercial and multi-family mortgages held by nonbank lenders and investors will mature this year.
That amount is down by 21% compared to the $150.6 billion that matured in 2012, according to the Mortgage Bankers Association’s 2012 Commercial Real Estate/Multifamily Survey of Loan Maturity Volumes.
The loan maturities vary significantly by investor group, the MBA said.
Five percent or $16 billion of the outstanding balance of multifamily and health care mortgages held or guaranteed by Fannie Mae, Freddie Mac, FHA and Ginnie Mae will mature in 2013.
Life insurance companies will see 7% or $21.9 billion of their outstanding mortgage balances mature in 2013, the MBA said.
Twenty-one percent or $38.1 billion of commercial mortgages held by credit companies and other investors will mature in 2013.
Commercial and multifamily mortgages are generally long-term loans that span seven years, 10 years or longer, and each year since 2010, the volume of commercial and multifamily mortgages maturing in that year has declined, according to Jamie Woodwell, MBA’s vice president of commercial real estate research.
The volume of loans maturing in 2013 and 2014 will mark cycle lows for loan maturities, each representing less than 8% of the outstanding balance of loans, Woodwell said, adding the relatively long-term nature of commercial and multifamily mortgage debt helped the market weather the recession and its slow recovery.
“During the recession, and even in more recent years, approaching commercial and multifamily mortgage maturity volumes were referred to as akin to a ‘ticking time-bomb’ that would overwhelm the real estate finance markets,” Woodwell said.
The MBA’s 2012 survey collected information directly from servicers on the years of maturity of $1.51 trillion in outstanding nonbank-held commercial and multifamily mortgages. The dollar figures reported are the unpaid principal balances as of Dec. 31, 2012, according to the association.
The MBA said because most loans pay down principal, the balances at the time of maturity will generally be lower than those reported here.