First quarter 2016 multifamily and commercial loan originations were 38 percent lower than the fourth quarter of 2015 but in line with the seasonality of the market, according to the quarterly survey by the Mortgage Bankers Association (MBA).
Overall first quarter 2016 saw these types of loan originations essentially flat compared to the first quarter of 2015.
“In the aggregate, commercial real estate borrowing and lending started 2016 in a similarly strong fashion to 2015,” Jamie Woodwell, MBA’s Vice President of Commercial Real Estate Research, said in a press release. “Borrowing backed by retail, office, hotel and multifamily properties picked up, as did lending by banks. Disruptions in the broader capital markets pushed originations for commercial mortgage-backed securities (CMBS) down. Across property types and investor types, changes in regulation and broader market conditions could have an impact on originations during the remainder of the year.”
First quarter 2016 multifamily loan originations up two percent year-over-year
A rise in originations for retail and office properties led the overall increase in lending volumes when compared to the first quarter of 2015. The first quarter also saw:
- 44 percent year-over-year increase in the dollar volume of loans for retail properties
- 18 percent increase for office properties
- 2 percent increase for multifamily properties
- 3 percent increase for hotel properties
- 56 percent decrease in industrial property loans
- 57 percent decrease in health care property loans
Among investor types, the dollar volume of loans originated for commercial bank portfolio loans increased by 44 percent year-over-year. There was a one percent year-over-year decrease for life insurance company loans, a 19 percent decrease in the dollar volume of Commercial Mortgage Backed Securities (CMBS) loans, and a 22 percent decrease in Government Sponsored Enterprises (GSEs – Fannie Mae and Freddie Mac) loans.
First quarter 2016 loan originations down 38 percent from fourth quarter 2015
In line with the seasonality of the market, first quarter 2016 originations compared to fourth quarter 2015 showed:
- 62 percent decrease for health care properties
- 57 percent decrease for hotel properties
- 57 percent decrease for industrial properties
- 46 percent decrease for retail properties
- 39 percent decrease for multifamily properties
- 23 percent decrease for office properties
Detailed statistics on the size and scope of this loan origination market are available from these MBA commercial/multifamily research reports. • Commercial Real Estate/Multifamily Finance: Annual Origination Volume Summation, 2015 • Commercial Real Estate/Multifamily Finance Firms: Annual Origination Volumes, 2015 • Commercial/Multifamily Database Subscription