August 31, 2008
PRIVATE MORTGAGES POST POSITIVE SECOND QUARTER
Private commercial mortgages held by life insurance
companies posted a 0.26 percent total return for second quarter
2008, according to the LifeComps Commercial Mortgage Index. The
positive return followed a 0.82 percent gain in first quarter 2008.
Of total return in the second quarter, 1.51 percent
was income return and -1.25 percent was price return. The negative
price return resulted from higher treasury yields, which overrode
declines in mortgage spreads during the quarter.
For the twelve months ended June 30, 2008, total
return was 6.15 percent, of which 6.52 percent was income return and
-0.37 percent was price return. The property type with the highest
total return over the prior 12 months was office with a 6.35 percent
return.
The LifeComps Commercial Mortgage Index is the only
published benchmark for the private commercial mortgage market based
on actual cash flow data, which has been collected quarterly from
participating life insurance companies since 1996. LifeComps
originated following the real estate recession of the early 1990s
when a group of major life insurer companies resolved to build the
first database to capture commercial real estate whole loan
performance over time. Participating life insurers include Allstate
Life Insurance Company, CIGNA Investment
Management, The Equitable, John Hancock, Nationwide,
Northwestern Mutual, Principal Financial and Prudential Insurance
Company of America.
Active loans in the LifeComps Index number 6,700 with
an aggregate principal balance of approximately $85.5 billion and
market value of $84.9 billion. The weighted average duration is 4.42
years, and average loan-to-value is 55.3 percent.
Since its inception, the LifeComps database has
tracked individual cash flows on more than 11,500 loans with
principal balances totaling in excess of $155 billion. More than
4,600 loans totaling $61 billion have been tracked from origination
to disposition.
The LifeComps Index is published quarterly, 60 days
after the end of each quarter in compliance with antitrust
guidelines determined by counsel. LifeComps participants receive
detailed quarterly reports that provide commercial mortgage
performance statistics including total return, cash yield, default,
and basis point loss for their portfolio versus the LifeComps total
portfolio as well as attribution analysis showing performance
contribution by property type, region, loan size and origination
year. For more information, visit
www.lifecomps.com.
CONTACTS:
For More Information on this Press Release
Northwestern
Mutual Media Relations, Northwestern Mutual
Phone: 800-323-7033
LifeComps Group
Michael Mannix, Director
Phone: 617-429-3047
