In 2013, $119.5 billion, eight percent of the outstanding balance, of commercial and multifamily mortgages held by non-bank lenders and investors will mature, a 21 percent decline from the $150.6 billion that matured in 2012, according to a report released by the Mortgage Bankers Association (MBA), the 2012 Commercial Real Estate/Multifamily Survey of Loan Maturity Volumes.
The loan maturities vary significantly by investor group. Just five percent ($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 percent ($21.9 billion) of their outstanding mortgage balances mature in 2013. Among loans held in CMBS, seven percent ($43.4 billion) will come due in 2013. Twenty-one percent ($38.1 billion) of commercial mortgages held by credit companies and other investors will mature in 2013.
“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,” said Jamie Woodwell, MBA’s VP of Commercial Real Estate Research. “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. The volume of loans maturing in 2013 and 2014 will mark cycle lows for loan maturities, each representing less than 8 percent of the outstanding balance of loans. In reality, the relatively long-term nature of commercial and multifamily mortgage debt helped the market weather the recession and its slow recovery.”
MBA’s 2012 survey collected information directly from servicers on the years of maturity of $1.51 trillion in outstanding non-bank-held commercial/multifamily mortgages. Compared to 2012 loan maturities, the volume of loans maturing in 2013 will increase for life insurance companies and for Fannie Mae, Freddie Mac and FHA, and will decrease for commercial mortgage-backed secutiries (CMBS) and for credit companies and other investors.
The dollar figures reported are the unpaid principle balances as of Dec. 31, 2012. Because most loans pay down principle, the balances at the time of maturity will generally be lower than those reported here. This survey covers $1.51 trillion of commercial and multifamily mortgages held or insured by life companies, Fannie Mae, Freddie Mac, FHA, CMBS trusts and other non-bank lenders and investors. Banks and thrifts hold an additional $819 billion in mortgages backed by income producing properties which are not covered by this survey.