The Mortgage Banker Association's (MBA) Commercial Real Estate Finance (CREF) and Multifamily Housing Convention & Expo 2008 held last week began with opening remarks from MBA President and CEO Jonathan Kempner. Kempner's comments drew a parallel between the past year in CREF markets and the recent Super Bowl game in terms of the "Wow factor." Kempner also cited the MBA's involvement in the Terrorism Renewal Insurance Act (TRIA) extension and Federal Housing Administration loan limit increases, which he considered as overall positives for the CREF sector.

In his remarks, MBA Chairman Kieran Quinn referred to the end of the Golden Era that alluded to the mortgage industry's good fortune over the past 15 years. This stint, according to Quinn, lasted longer than most as most up real estate cycles that usually only go on for seven years on average. He noted how capital was flowing into the real estate markets and the fact that interest rates and cap rates remained low until mid-August last year, which was when spreads broke loose in CMBS. He also raised his concern that CMBS would suffer the contagion effect that prime residential mortgage markets have had to endure. Commercial delinquencies, although expected to double in 2008, would still fall in the 1.2% range - quite stellar for most bond markets, Quinn said.

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