Commercial and multifamily mortgage loan originations increased 18% in the third quarter compared to the second quarter and were 16% higher compared to the third quarter of 2013, according to the Mortgage Bankers Association's (MBA) quarterly Commercial/Multifamily Mortgage Originations report.
Driving the overall increase was an increase in originations for industrial and multifamily properties.
On a year-over-year basis, the increase included a 41% increase in the dollar volume of loans for multifamily properties, a 22% increase for industrial properties, an 11% increase for office properties, an 11% increase for retail properties and a 4% increase in hotel property loans. There was a 43% decrease in health care property loans.
Among investor types, the dollar volume of loans originated for government sponsored enterprises (GSEs) Fannie Mae and Freddie Mac increased by 118% from the third quarter of 2013.
There was a 47% increase for commercial mortgage-backed securities (CMBS) loans, a 1% increase for life insurance company loans and a 16% decrease in dollar volume for commercial bank portfolio loans, according to the report.
Looking at the increase on a quarter-over-quarter basis, originations for office properties increased 43% compared to the second quarter. There was a 31% increase in originations for multifamily properties, a 19% increase for industrial properties, a 7% increase for retail properties and an 11% decrease for hotel properties. There was a 24% decrease for health care properties compared to the second quarter.
Quarter over quarter, dollar volume of loans for the GSEs increased 57%, loans for CMBS increased 10%, originations for life insurance companies increased 9% and loans for commercial bank portfolios decreased by 7%.
‘Commercial real estate borrowing and lending continued at a strong clip in the third quarter,’ says Jamie Woodwell, vice president of commercial real estate research for the MBA, in a release. ‘Low rates coupled with growth in property incomes, property values and sales transactions have pushed year-to-date commercial and multifamily mortgage originations five percent above last year's pace.’
To view the full report, click here.