Commercial, multifamily originations reach record high in 2017

by Francis Monfort12 Apr 2018

Mortgage bankers closed $530.1 billion in commercial and multifamily loans in 2017, posting a new record high, according to the 2017 Commercial Real Estate/Multifamily Finance Annual Origination Volume Summation released by the Mortgage Bankers Association (MBA).

The total dollar volume marks an 8% increase compared to the 2016 dollar volume. Among repeat participants in the survey, the dollar volume of closed loans increased by 7%.

"2017 was a very strong year, driven by solid property fundamentals, rising property values, low interest rates, and a ready supply of mortgage capital all contributing to extraordinarily attractive finance markets," MBA Vice President of Commercial Real Estate Research Jamie Woodwell said. "We expect another robust year in 2018, even with the slight increase in interest rates, although perhaps not quite as robust as 2017."

Commercial banks led all investor groups in terms of total volume with $151.2 billion in 2017 originations. Fannie Mae and Freddie Mac followed in second place with total originations of $130 billion. Commercial mortgage-backed securities issuers; life insurance companies and pension funds; and REITS, mortgage REITS, and investment funds followed.

Mortgage bankers originated loans for multifamily properties the most, with $233.9 billion in total volume. Office buildings, retail properties, hotel/motel, industrial, and health care property types followed. MBA also said that 96% of the total dollar volume were first-lien mortgages.


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