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MBA: Commercial and Multifamily Originations See Near 90 Percent Rise Over Last Year's Totals

May 05, 2011

First quarter 2011 commercial and multifamily mortgage originations were 89 percent higher than during the same period last year and 25 percent lower than during the fourth quarter of 2010, according to the Mortgage Bankers Association's (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations. The decrease from fourth quarter 2010 reflects the industry's usual push to finalize deals before the end of the year, and subsequent drop-offs in first quarter numbers. "The pace of commercial and multifamily mortgage lending continued to increase in the first quarter of this year," said Jamie Woodwell, MBA's VP of commercial real estate research. "Commercial/multifamily mortgage origination volumes for the first three months of 2011 were the highest of any first quarter since 2002, and were nearly double the volume seen during the first quarter of 2010." The 89 percent overall increase in commercial/multifamily lending activity during the first quarter of 2011 over the same period in 2010 was driven by increases in originations for all property types. When compared to the first quarter of 2010, this included a 465 percent increase in loans for hotel properties, a 194 percent increase in loans for industrial properties, a 104 percent increase in loans for multifamily properties, a 92 percent increase in loans for office properties, a 91 percent increase in loans for health care properties, and a 13 percent increase in loans for retail properties. Among investor types, first quarter 2011 originations for conduits for commercial mortgage-backed securities (CMBS) increased 391 percent compared to last year's first quarter. There was also a 126 percent increase in loans for life insurance companies, a 73 percent increase in loans for commercial bank portfolios, and a 59 percent increase for the Government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac. First quarter 2011 commercial/multifamily mortgage originations were 25 percent lower than originations in the fourth quarter of 2010. This includes an 83 percent decrease for health care properties, a 48 percent decrease for retail properties, a 44 percent decrease for hotel properties, a 28 percent decrease for multifamily properties, and a 15 percent decrease for office properties. Originations for industrial properties increased 12 percent. Among investor types, first quarter 2011 originations for conduits for CMBS decreased 58 percent compared to the fourth quarter of 2010. There was also a 45 percent decrease for GSEs and a 15 percent decrease for life insurance companies. Originations for commercial bank portfolios increased by 21 percent.
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