Commercial, multifamily originations keep pace year over year

by Francis Monfort22 Aug 2018

Commercial and multifamily mortgage loan originations increased 4% during the second quarter, remaining on pace with the same period in 2017, according to the Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations released by the Mortgage Bankers Association (MBA).

On a quarter-over-quarter basis, originations were 32% higher than the first quarter.

"Commercial and multifamily real estate borrowing and lending continues to track with last year's level," said Jamie Woodwell, MBA's vice president for commercial real estate research. "Investor demand for multifamily properties and hotels are helping push originations higher, even as loan demand for retail properties is down. New loan demand continues to be supported by still-low long-term interest rates, growing property incomes, and rising values."

The year-over-year increase was primarily driven by a rise in originations for hotel and multifamily properties. The dollar volume of loans for hotel properties increased 22% from the year-ago period, while multifamily properties recorded a 17% increase. Retails properties posted a 1% increase. Loans for office, industrial, and health care properties all decreased over the same period.

Hotel properties increased 89% during the second quarter compared to the first quarter. Retails property originations increased 87%, with office, multifamily, and industrial properties also posting increases. However, there was a 9% decrease for health care properties from the first quarter.