Commercial/multifamily mortgage originations rebound in Q4

by Candyd Mendoza09 Feb 2021

Commercial and multifamily mortgage lending saw some improvement in the fourth quarter of 2020, according to the Mortgage Bankers Association’s (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations.

Originations of mortgage loans backed by commercial and multifamily properties spiked 76% from the third quarter’s record low. However, commercial/multifamily borrowing and lending in 2020 was 30% lower than in 2019.

“Borrowing and lending remain weakest for the property types most impacted by the pandemic – particularly hotel and retail buildings. Multifamily, led by government-backed financing from FHA, Freddie Mac and Fannie Mae, continued to see the strongest commercial mortgage activity,” said Jamie Woodwell, vice president of commercial real estate research at MBA.

By property types, originations for hotel (+411%), industrial (+136%), retail (+111%), health care (+77%), and office (+26%) properties skyrocketed from the third quarter.

Among investor types, commercial bank portfolios posted the biggest increase, up 113% quarter over quarter. Loans for life insurance companies (+100%), government-sponsored originations (+67%), Commercial Mortgage-Backed Securities (+35%) followed.