Historical 5-Year Commercial Mortgage Spreads 425 400 375 350 - - PowerPoint PPT Presentation

25-Year Average Spread - 172

75 100 125 150 175 200 225 250 275 300 325 350 375 400 425

1985 1988 1991 1994 1997 2000 2003 2006 2009 2012

Spread (bp)

Historical 5-Year Commercial Mortgage Spreads

27-Year Average Spread - 172

Source: RBC Capital Markets, BMO Capital Markets

2% 4% 6% 8% 10% 12% 14% 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012

Interest Rate

Historical 5-Year Commercial Mortgage Rates

27-Year Average Rate -

Source: RBC Capital Markets, BMO Capital Markets

$0.0 ¡ $0.5 ¡ $1.0 ¡ $1.5 ¡ $2.0 ¡ $2.5 ¡ $3.0 ¡ $3.5 ¡ 2007 ¡ 2008 ¡ 2009 ¡ 2010 ¡ 2011 ¡

($ ¡Billions) ¡

Life ¡Insurance ¡Companies ¡ Mortgage ¡Approvals ¡

Q1 ¡& ¡Q2 ¡ Q3&Q4 ¡

100 200 300 400 500 600 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Spread (bp)

5-Year BBB Corporate Spread vs. 5-Year Commercial Mortgage Spread 5-Year Mortgage Spread 5-Year BBB Corporate Spread

Source: RBC Capital Markets, BMO Capital Markets