WASHINGTON, D.C. — Riding on the strength of Fannie Mae and Freddie Mac, new mortgage originations for commercial real estate properties increased 29 percent in the second quarter compared with the same period a year ago, according to the Mortgage Bankers Association (MBA). What’s more, new mortgage originations in the second quarter were up 16 percent from the first quarter of 2015
The MBA’s Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations shows year-over-year increases in mortgage originations every year since 2009.
Government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac led the commercial real estate lending market with a 113 percent increase in deal volume from second-quarter 2014 to second-quarter 2015.
“Driven by increasing property values, improving property fundamentals and still-low interest rates, commercial and multifamily lending and borrowing continued its strong pace in the second quarter,” says Jamie Woodwell, MBA’s vice president of commercial real estate research. “Mortgage bankers’ originations for Fannie Mae and Freddie Mac are near record quarterly levels.”
Of all property sectors, multifamily posted the strongest increase at 58 percent, followed by industrial properties at 32 percent. Office, retail and hotel properties saw more modest increases of 22 percent, 17 percent and 16 percent, respectively.
The only property type to experience a decrease in lending activity was the healthcare sector, which saw a 50 percent drop in lending volume.
The only investor type to see a year-over-year decrease was the commercial mortgage-backed securities segment, which dropped by 17 percent. Commercial bank portfolio loans and life insurance company loans saw increases of 64 percent and 14 percent, respectively.
MBA’s Survey of Commercial/Multifamily Mortgage Bankers Originations provides updates on changes in the originations market based on a same-store sample of originations every quarter. The report shows trends by investor type in the volume of loans originated, breaking the data down by property type as well. MBA launched the survey in 2002; it uses an average of 2001 data as its benchmark and indexes all data compared to that.
Click here to read the full report.
— Jeff Shaw