Commercial and multi-family mortgage bankers' loan originations were strong in the first quarter, according to the Mortgage Bankers Association's (MBA) Quarterly Survey of Commercial/Multi-family Mortgage Bankers Originations. While down from the fourth quarter of last year, first quarter originations were up 37 percent compared to the same period last year. The increase was seen across all property types and most investor groups.
"Increases in total commercial/multi-family mortgage originations were led by increases in commercial mortgage-backed securities (CMBS) conduit loans and loans financing office properties," said Jamie Woodwell, MBA's senior director of commercial/multi-family research. "The strong first quarter included heavy volume driven by real estate investment trusts privatizations and continues a trend of first quarter-over-first quarter increases going back to the beginning of MBA's survey which was first released in 2001."
The increase in commercial/multi-family lending activity during the first quarter was driven by increases in originations for all property types. When compared to the first quarter of 2006, the overall increase included a 64 percent increase in loans for health-care properties, a 62 percent increase in loans for office properties, a 37 percent increase in loans for hotel properties, 26 percent increase in multi-family loans, 25 percent increase in loans for retail properties and a 14 percent increase in loans for industrial properties.
Among investor types, conduits for CMBS, government-sponsored enterprises (or GSEs--Fannie Mae and Freddie Mac) and life insurance companies saw increases when compared to the same quarter last year, while originations for commercial banks decreased compared to the first quarter of 2006.
First quarter 2007 mortgage bankers' originations were 15 percent lower than originations in the fourth quarter of 2006, reflecting the industry's usual push to finalize deals before the end of the year, and the traditional and subsequent drop-offs in first quarter numbers. First quarter numbers show decreases in all property types except hotel.
More detailed statistics on the commercial/multi-family origination market are available from other periodic MBA commercial/multi-family reports. These include:
-Commercial Real Estate/Multi-family Finance: Annual Origination
Volume Summation, 2006
-Commercial Real Estate/Multi-family Finance Firms: Annual Origination Volumes, 2006
-MBA Annual Report on Multi-family Lending, 2006
-Commercial Real Estate/Multi-family Finance Quarterly Data Book
For more information, visit www.mbaa.org.