Commercial, Multifamily Mortgage Originations Up 12%

Real Estate In-Depth | November 2015

WASHINGTON—According to the Mortgage Bankers Association’s Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations, third quarter 2015 commercial and multifamily mortgage loan originations were 12% higher than during the same period last year and 3% higher than the second quarter of 2015.

“Commercial mortgage borrowing and lending continued to grow during the third quarter,” said Jamie Woodwell, MBA’s vice president of commercial real estate research. “Every major investor group and property type except one has seen increases in year-to-date lending volumes, and we expect year-end numbers to continue that trend.”

Increases in originations for retail and office properties led the overall increase in commercial/multifamily lending volumes when compared to the third quarter of 2015. The increase included a 39% increase in the dollar volume of loans for retail properties, a 17% increase for office properties, an 11% increase for multifamily properties, a 10% increase for industrial properties, a 9% decrease in hotel property loans, and health care property loans decreased 30% year-over-year.

Among investor types, the dollar volume of loans originated for commercial bank portfolio loans increased by 93% from last year’s third quarter. There was an 18% increase for life insurance company loans, a 3% decrease for Government Sponsored Enterprises (GSEs – Fannie Mae and Freddie Mac) loans, and an 8% decrease in dollar volume for Commercial Mortgage Backed Securities (CMBS) loans.

Third quarter 2015 originations for office properties increased 37% compared to the second quarter 2015. There was a 27% increase in originations for retail properties, a 5% increase for health care properties, a 1% decrease for industrial properties, an 8% decrease for multifamily properties, and a 29% decrease for hotel properties from the second quarter 2015.

Among investor types, between the second and third quarter of 2015, the dollar volume of loans for CMBS increased 22%, loans for life insurance companies increased 13%, originations for commercial bank portfolios increased 9%, and loans for GSEs decreased by 28%.