MBA: Q2 CRE Originations Increase Over Q1, Remain Flat Over Last Year

Second-quarter commercial and multifamily mortgage loan originations were 1% higher than they were during the same period last year and 35% higher than during the first quarter, according to the Mortgage Bankers Association's (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations.

‘Borrowing remains light, as few commercial property owners are selling or refinancing their properties unless they have to,’ says Jamie Woodwell, the MBA's vice president of commercial real estate research. ‘Life insurers, [commercial mortgage-backed securities (CMBS)] conduits and others are back in the market and lending, and rates are at extremely attractive levels. However, low volumes of property sales, depressed property values, stressed cashflows and modest loan maturities are all keeping borrowing to a minimum.’

The 1% overall increase in lending activity during the second quarter was driven by increases in originations for office and industrial properties, the MBA says. When compared to the second quarter of 2009, the increase included a 183% increase in loans for industrial properties, a 180% increase in loans for office properties, an 18% increase in loans for hotel properties, a 76% decrease in loans for healthcare properties, a 25% decrease in multifamily property loans and a 9% decrease in retail property loans.

By investor types, originations for life insurance companies and CMBS conduits increased dramatically on a percentage basis, while originations for Fannie Mae and Freddie Mac fell by more than half (55%) from 2009 levels.

Compared to the first quarter, second-quarter originations for hotel properties saw a 405% increase. There was also a 114% increase for industrial properties, a 107% increase for healthcare properties, a 56% increase for office properties and a 38% increase for multifamily properties. Retail property originations fell 11% from the first quarter.

The complete report is available on the MBA's website.

SOURCE: Mortgage Bankers Association


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