Commercial mortgage debt threat diminishing, survey says

The amount of commercial real estate debt coming due in the months ahead is falling, the Mortgage Bankers Assn. said, suggesting that its threat to the economy is diminishing.

Ten percent, or $150.6 billion, of commercial and multifamily mortgages held by non-bank lenders and investors will mature in 2012, a 3% decline from the $154.7 billion that matured in 2011 and an 18% decline from 2010, according a survey conducted by the MBA.

The association started taking the survey in 2008 in response to concerns that there was a coming wave of commercial mortgage maturities that would swamp the market, said Jamie Woodwell, MBA’s vice president of commercial real estate research.

The loan maturities vary significantly by investor group. Just 4% of the outstanding balance of multifamily and healthcare mortgages held or guaranteed by Fannie Mae, Freddie Mac, FHA and Ginnie Mae will mature in 2012.

Life insurance companies will see 6% of their outstanding mortgage balances mature in 2012. Among loans held in commercial-mortgage-backed securities, 11% will come due, and 29% of commercial mortgages held by credit companies and other investors will mature in 2012.

The dollar figures reported are the unpaid principal balances as of Dec. 31. Banks and thrifts hold an additional $793 billion in mortgages backed by income-producing properties, which were not covered by the survey.

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