MBA: 3Q Commercial/Multifamily Borrowing Jumps Nearly 120% Year over Year

Commercial and multifamily mortgage loan originations increased by 119 percent in the third quarter from a year ago and increased by 19 percent from the second quarter, the Mortgage Bankers Association’s Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations reported.

Jamie Woodwell

“Overall levels of commercial real estate borrowing and lending are running at high levels, but there continues to be an important differentiation by property type,” said Jamie Woodwell, MBA Vice President of Commercial Real Estate Research. “Borrowing hit an all-time quarterly high during the third quarter, driven by strong or improving market fundamentals, higher property values, low interest rates and solid mortgage performance.”

Woodwell said borrowing and lending backed by industrial and multifamily properties are each running at a record annual pace. While year-to-date office and retail lending are up significantly from last year, both remain below 2019 levels.

“Among capital sources, nearly every major group–including CMBS, banks, life companies and investor-driven lenders–is lending well above 2020 levels, with life companies and investor-driven lenders also exceeding their 2019 year-to-date volumes,” Woodwell noted. “The one exception is the GSEs (Fannie Mae and Freddie Mac), whose conservator limited their loan purchase volumes this year.”


All property types showed an increase in the third quarter in commercial/multifamily lending volumes from a year ago, including an 866 percent year-over-year increase in dollar volume of loans for hotel properties, a 317 percent increase for retail properties, a 156 percent increase for industrial properties, a 105 percent increase for multifamily properties, a 102 percent increase for office properties and a 45 percent increase for health care property loan originations.

Among investor types, dollar volume of loans originated for investor-driven lenders (real estate investment trusts, specialty finance, credit companies and other) increased by 319 percent year-over-year. MBA reported a 232 percent increase for commercial bank portfolio loans, a 175 percent increase for life insurance company loans, a 125 percent increase in the dollar volume of commercial mortgage-backed securities loans and a 15 percent increase for Government-Sponsored Enterprises loans.


On a quarterly basis, third-quarter originations for retail properties increased 62 percent. MBA reported a 60 percent increase in originations for hotel properties, a 31 percent increase for multifamily properties and a 9 percent increase for office properties. Industrial properties were essentially unchanged, and originations for health care properties decreased 52 percent.

Among investor types, dollar volume of loans for GSEs increased 79 percent, commercial banks’ portfolios increased 51 percent and originations for life insurance companies increased 3 percent. Loans for CMBS decreased 5 percent and loans for investor-driven lenders decreased 6 percent.

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