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Commercial and multifamily mortgage originations increased 27 percent between the third and the fourth quarters of 2014, and were up eleven percent compared to the fourth quarter of 2013, according to the Mortgage Bankers Association’s (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations. MBA’s commercial/multifamily mortgage bankers’ originations index provides a preliminary estimate that originations for the full year 2014 were seven percent higher than in 2013.
“Commercial and multifamily mortgage markets ended the year strong,” said Jamie Woodwell, MBA’s vice president of Commercial Real Estate Research. “The fourth quarter set record quarterly origination volumes for life insurance companies, for Fannie Mae and Freddie Mac and for multifamily lending. With low interest rates, rising property values and improving property fundamentals—and in spite of a significant drop in the volume of loans maturing during the year—the preliminary numbers show every major investor group increased commercial and multifamily lending in 2014.”
The eleven percent overall increase in commercial/multifamily lending volumes when compared to the fourth quarter of 2013 was driven by an increase in originations for multifamily and industrial properties. The increase included a 39 percent increase in the dollar volume of loans for multifamily properties, a 24 percent increase for industrial properties, a 16 percent increase for retail properties, an 11 percent increase for hotel properties, a two percent increase in office property loans, and an eight percent decrease in healthcare property loans.
Among investor types, the dollar volume of loans originated for government sponsored enterprise (GSEs)—Fannie Mae and Freddie Mac—increased by 119 percent from last year’s fourth quarter. There was an eight percent increase for life insurance companies, a six percent increase for CMBS and a seven percent decrease in dollar volume of loans originated for commercial bank portfolios.
Fourth quarter 2014 commercial and multifamily mortgage originations were 27 percent higher than in the third quarter. Compared to the third quarter, fourth quarter 2014 originations for healthcare properties increased 92 percent. There was a 42 percent increase in originations for multifamily properties, a 41 percent increase for retail properties, a 32 percent increase for hotel properties, a 20 percent increase for industrial properties, and office property originations were flat from the third to the fourth quarter 2014.
Among investor types, between the third and fourth quarters of 2014, loans for commercial bank portfolios increased 59 percent, loans for GSEs increased 49 percent, originations for life insurance companies increased 16 percent, and loans for CMBS decreased by three percent.
A preliminary measure of commercial and multifamily mortgage origination volumes shows 2014 originations seven percent higher than during 2013. Compared to 2013, originations for industrial properties increased 27 percent. There was a 21 percent increase for hotel properties, a 15 percent increase for multifamily properties, a five percent increase for office properties, a one percent increase for retail properties, and a four percent decrease for healthcare properties.
Among investor types, 2014 versus 2013, loans for GSEs increased 33 percent, loans for CMBS increased in 20 percent, originations for commercial bank portfolios increased six percent and loans for life insurance companies increased two percent 2014 versus 2013. In late March, MBA will release its Annual Origination Summation report for 2014 with final origination figures for the year.