Scott Reid
According to the MBA’s Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations, a decrease in loan originations for retail and multifamily properties led to a 2 percent decrease in overall commercial/multifamily originations in the second quarter compared with the same period a year ago.
The 2 percent decrease between the second quarter of this year and the second quarter of 2013 included a 10 percent decrease in the dollar volume of loans for retail properties, a 10 percent decrease for multifamily properties and a 6 percent decrease for office properties.
Loan originations for retail and multifamily properties in the second quarter of 2014 were 34 percent higher than the first quarter, due to the increase of hotel property originations by 91 percent, a 78 percent increase for health care properties, a 64 percent increase for retail properties and 44 percent increase for office properties.
Jamie Woodwell, MBA’s vice president of commercial real estate research, says there are a variety of factors at work. “Low interest rates and improving property fundamentals are prompting borrowers to act, but the relatively low volume of loans hitting maturity is checking overall demand.”
Among investor types, the dollar volume of loans originated for government-sponsored enterprises (GSEs), Fannie Mae or Freddie Mac, decreased by 13 percent compared with last year’s second quarter. There was a 13 percent decrease for life insurance company loans, a 19 percent increase for commercial bank portfolio loans and a 45 percent increase in dollar volume for CMBS loans.
Between the first and second quarters of 2014, the dollar volume of loans for CMBS increased 132 percent, loans for GSEs increased 99 percent, originations for life insurance companies increased 47 percent and loans for commercial bank portfolios decreased by 12 percent.