MBA: 2Q Commercial/Multifamily Borrowing Up 20% From Year Ago

Second quarter commercial and multifamily mortgage loan originations jumped by 28 percent from the first quarter and by 20 percent from a year ago, the Mortgage Bankers Association reported in its Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations.

“Borrowing and lending backed by commercial and multifamily properties has been strong the first half of this year,” said MBA Vice President of Commercial Real Estate Research Jamie Woodwell. “Reflecting broad industry trends, borrowing backed by industrial properties increased by two-thirds compared to the first half of 2016, while borrowing backed by retail properties dropped by one-sixth. As was the case during the first quarter, commercial/multifamily mortgage bankers’ originations increased despite a slowdown in the volume of sales transactions.”

2Q Originations Up 20% From Year Ago
A rise in originations for industrial and office properties led the overall increase in commercial/multifamily lending volumes from a year ago. MBA reported a 91 percent year-over-year increase in dollar volume of loans for industrial properties, a 33 percent increase for office properties, a 21 percent increase for multifamily properties, a 14 percent increase for hotel properties, a 7 percent increase in health care property loans and a 9 percent decrease in retail property loans.

Among investor types, dollar volume of loans originated for commercial mortgage-backed securities loans increased by 168 percent year-over-year. MBA reported a 26 percent year-over-year increase for government sponsored enterprises (Fannie Mae and Freddie Mac) loans, a 2 percent decrease in life insurance company loans and a 21 percent decrease in the dollar volume of commercial bank portfolio loans.

2Q Originations Up 28% from 1Q
Second quarter originations for hotel properties increased by 139 percent compared to the first quarter. MBA reported a 39 percent increase in originations for industrial properties, a 39 percent increase for office properties, a 34 percent increase for retail properties, a 25 percent increase for multifamily properties and a 34 percent decrease for health care properties.

Among investor types, dollar volume of loans for CMBS increased 117 percent, loans for life insurance companies increased 25 percent, originations for GSEs increased 22 percent, and loans for commercial bank portfolios decreased by 5 percent.

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