Investors beef up commercial holdings

by MPA30 Sep 2013

Commercial and multifamily mortgage debt increased by $24.5bn in the second quarter as three major investor groups beefed up their holdings, according to a report released Thursday by the Mortgage Bankers Association.

Total commercial/multifamily mortgage debt in the second quarter stood at $2.45 trillion, $24.5bn higher than the Q1 figure. Outstanding multifamily debt jumped to $875bn, a $10.9bn increase from Q1, according to MBA.

“A strong appetite among investors to put their money to work in commercial and multifamily mortgages led to an increase in the level of mortgage debt outstanding,” said Jamie Woodwell, MBA’s vice president of commercial real estate research.  “In the second quarter alone, banks increased their holdings of commercial and multifamily mortgages by $16 billion; Fannie Mae, Freddie Mac and FHA increased their multifamily holdings and guarantees by $5.6 billion and life insurance companies increased their commercial and multifamily holdings by $4.0 billion.”

Commercial banks hold the largest share of commercial and multifamily debt -- $855bn, or 35% of the total debt, according to MBA. Commercial mortgage-backed securities, collateralized debt obligations and other asset-backed security issues are the second-largest holders of commercial/multifamily mortgages, with holdings of $557bn, or 23%.


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