Commercial originations hit highs

by Justin da Rosa05 Aug 2015
It’s not just the residential mortgage sector that is experiencing a post-recession resurgence, as commercial lending sees impressive volume increases as well.

"Driven by increasing property values, improving property fundamentals and still low interest rates, commercial and multifamily lending and borrowing continued its strong pace in the second quarter," Jamie Woodwell, MBA's Vice President of Commercial Real Estate Research said in a release. "The rate of year-over-year growth slowed from the first quarter, but year-to-date lending is up for every major lender group.  Mortgage bankers' originations for Fannie Mae and Freddie Mac are near record quarterly levels."

And while the commercial market doesn’t always follow the residential market, originators are viewing these stats with optimism.

“The commercial market is a little different because it didn’t suffer as much as the residential market,” John Councilman of AMC Mortgage Corporation told MPA. “Overall, though, I think people are viewing (the market) with optimism and that’s why you’re seeing commercial originations are up; office projects are doing extraordinarily well, despite the time we are in and the number of telecommuters these days.”

According to the Mortgage Bankers Association, second quarter 2015 originations for commercial/multifamily saw a year-over-year increase that includes a 58 percent increase in dollar volume for multifamily loans and a 32 percent increase for industrial properties.

“Commercial real estate lending experienced growth in every major property type during the second quarter of 2015,” The MBA said in a release. “Specifically, second quarter 2015 commercial and multifamily mortgage loan originations were 29 percent higher than during the same period last year.”

Dollar volumes also increased for office properties (+22 percent), retail properties (+17 percent), and hotel properties (+16 percent), according to the MBA.


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