“The market is just roaring back from a volume perspective”
Global investment firm KKR & Co. has more than doubled its commercial mortgage lending record, citing growing demand for financing for commercial properties.
The company’s real estate finance division financed roughly $4 billion in commercial property loans and committed to $4 billion more this year through June 30 – eclipsing its previous full-year record of $3.1 billion in 2019. However, KKR’s lending volume was down to $1.4 billion last year due to the pandemic.
“The market is just roaring back from a volume perspective,” Matt Salem, KKR’s head of real estate credit, told Bloomberg in an interview. “Pipelines are very big across the board.”
According to the Mortgage Bankers Association, total commercial/multifamily mortgage debt grew by $44.6 billion to $3.93 trillion in the first three months of this year.
As of March 31, KKR reported $28 billion of real estate assets under management, which is projected to increase by $15 billion in the coming year.
KKR, a private equity investor, has funded office projects in big cities, including Atlanta, Dallas and Miami. However, KKR is still staying out of markets hard-hit by the pandemic-induced urban exodus like New York and San Francisco.
“We’re much more focused on creating new loans,” he said, “and not on acquiring the scratch-and-dent ones.”