Commercial and multifamily mortgage loan originations inched up in the second quarter, increasing 3% year over year and 27% quarter over quarter, according to data from the Mortgage Bankers Association (MBA).
Year over year, originations for multifamily properties in the second quarter decreased 14%. Results were varied for other property types. The dollar volume of loans for hotel properties jumped 172%, while industrial and health care properties saw increases of 77% and 50%, respectively. Originations for office properties dropped 29%, and retail decreased 7%.
The dollar volume of loans originated for commercial mortgage-backed securities (CMBS) increased 154% year over year in the second quarter. Investor-driven lenders and life insurance company loans also saw momentum, increasing 17% and 11%, respectively. However, government-sponsored enterprise (GSE) loans saw a 20% decrease, and loans for depositories dropped 26%.
Originations for all property types saw quarterly improvements in the second quarter: multifamily, 27%; health care, 178%; hotel, 84%; industrial, 29%; retail, 18%; and office, 4%. Between the first and second quarters, the dollar volume of loans for life insurance companies rose 60%, while loans for depositories and CMBS both saw increases of 21%. The dollar volume of loans for investor-driven lenders rose 20%, and the GSEs saw a 16% increase.
“Borrowing and lending backed by commercial real estate remained subdued in the second quarter,” said Jamie Woodwell, MBA’s head of commercial real estate research. “Most capital sources remain ready, willing, and able to lend on properties that can support a loan. Driven by growth in the single-asset single-borrower markets, originations for CMBS grew significantly during the quarter.”
He added that the MBA anticipates more borrower activity in the coming quarters due to interest rates moderating and a large number of loans maturing.
