Commercial Lending up Big in 2013, Led by Multifamily

Mortgages for multifamily properties outpaced other commercial and multifamily mortgage originations in 2013 the Mortgage Bankers Association (MBA) said today.  Those loans accounted for $136.9 billion in loan volume during the year out of a total of $358.5 in loans originated by commercial and multifamily mortgage bankers.  The second most active property type was office buildings followed by retail properties, hotel/motel, industrial, and health care.  Ninety-seven percent of the dollar volume of loans were first mortgage liens.

The total reported loan volume increased 47 percent from what was reported in 2012, however MBA said that a growth in its survey coverage accounted for part of the growth in loan volume.    Among the survey's repeat respondents the dollar volume of lending increased by 22 percent.

MBA's 2013 Commercial Real Estate/Multifamily Finance Annual Origination Volume Summation notes that commercial banks and savings institutions were the leading investor group, accounting for $100.5 billion of the total loan volume.  This sector was followed by CMBS issues with $79.8 billion, and then by life insurance companies and pension funds, Fannie Mae, and REITS.

"Improving property markets and a strong appetite among lenders led to a very active year in commercial real estate finance," said Jamie Woodwell, MBA's Vice President of Commercial Real Estate Research.  "Multifamily rental properties drew the most financing, and banks and thrifts were the largest source of commercial real estate lending.  Despite the fact there are fewer maturing loans in need of refinancing this year, originations should continue to be buoyed by higher property values, rising property incomes and still low interest rates."