KeyBank 2015 Annual Report Download - page 75

As presented in Figure 17, at December 31, 2015, our commercial real estate portfolio included mortgage loans
of $8 billion and construction loans of $1.1 billion, representing 13% and 2%, respectively, of our total loans.
Nonowner-occupied loans represented 11% of our total loans and owner-occupied loans represented 4% of our
total loans. The average size of mortgage loans originated during 2015 was $5.5 million, and our largest
mortgage loan at December 31, 2015, had a balance of $69.3 million. At December 31, 2015, our average
construction loan commitment was $8.5 million. Our largest construction loan commitment was $48 million, and
our largest construction loan amount outstanding was $43 million.
Also shown in Figure 17, at December 31, 2015, 72% of our commercial real estate loans were for nonowner-
occupied properties, compared to 70% at December 31, 2014. Approximately 15% of these loans were
construction loans at both December 31, 2015, and December 31, 2014. Typically, these properties are not fully
leased at the origination of the loan. The borrower relies upon additional leasing through the life of the
construction loan to provide the cash flow necessary to support debt service payments. A significant decline in
economic growth, and in turn, in rental rates and occupancy, would adversely affect our portfolio of construction
loans.
Figure 17. Commercial Real Estate Loans
Geographic Region Percent of
Total
Commercial
Mortgagedollars in millions West Southwest Central Midwest Southeast Northeast National Total Construction
December 31, 2015
Nonowner-occupied:
Retail properties $ 204 $ 102 $ 69 $ 119 $ 266 $ 94 $ 144 $ 998 11.1 % $ 181 $ 817
Multifamily properties 401 149 543 620 859 157 172 2,901 32.2 491 2,410
Health facilities 218 — 134 127 331 206 15 1,031 11.4 161 870
Office buildings 94 7 197 85 114 56 — 553 6.1 38 515
Warehouses 133 2 45 98 35 83 167 563 6.3 57 506
Manufacturing facilities 6 — 2 12 16 15 14 65 .7 — 65
Hotels/Motels 14 — 11 6 — 6 — 37 .4 — 37
Residential properties 1 — 25 1 2 12 1 42 .5 8 34
Land and development 6 — 5 11 8 10 — 40 .4 32 8
Other 65 12 4 24 33 80 76 294 3.3 17 277
Total nonowner-occupied 1,142 272 1,035 1,103 1,664 719 589 6,524 72.4 985 5,539
Owner-occupied 1,021 5 274 568 57 563 — 2,488 27.6 68 2,420
Total $ 2,163 $ 277 $ 1,309 $ 1,671 $ 1,721 $ 1,282 $ 589 $ 9,012 100.0 % $ 1,053 $ 7,959
December 31, 2014
Total $ 2,518 $ 307 $ 1,261 $ 1,668 $ 1,393 $ 1,315 $ 685 $ 9,147 $ 1,100 $ 8,047
December 31, 2015
Nonowner-occupied:
Nonperforming loans — — — $ 7 — $ 9 — $ 16 N/M $ 7 $ 9
Accruing loans past due 90 days or more — — — 2 — 4 — 6 N/M — 6
Accruing loans past due 30 through 89 days $ 2 — — 5 — — 1 8 N/M 1 7
West – Alaska, California, Hawaii, Idaho, Montana, Oregon, Washington, and Wyoming
Southwest – Arizona, Nevada, and New Mexico
Central – Arkansas, Colorado, Oklahoma, Texas, and Utah
Midwest – Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin
Southeast – Alabama, Delaware, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, South Carolina, Tennessee,
Virginia, Washington, D.C., and West Virginia
Northeast – Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont
National – Accounts in three or more regions
During 2015, nonperforming loans related to our nonowner-occupied properties decreased by $5 million from
$21 million at December 31, 2014, to $16 million at December 31, 2015, as a result of continued improvement in
asset quality and market conditions. This category of loans declined by $2 million during 2014.
Since December 31, 2014, our nonowner-occupied commercial real estate portfolio has increased by
approximately $84 million, or 1.3%, as many of our clients have taken advantage of opportunities to permanently
refinance their loans at historically low interest rates.
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