The level of commercial/multifamily mortgage debt outstanding increased by $46 billion in the fourth quarter of 2016, a 1.6 percent increase from the third quarter and a 5.8 year-over-year increase, according to the new data from the Mortgage Bankers Association (MBA)
Total commercial/multifamily debt outstanding rose to $2.96 trillion at the end of the fourth quarter while multifamily mortgage debt outstanding rose to $1.14 trillion, an increase of $27.3 billion, or 2.4 percent, from the third quarter. Commercial banks held the largest share of commercial/multifamily mortgages during the fourth quarter—$1.2 trillion, or 40 percent of the total—while agency and government-sponsored enterprise (GSE) portfolios and mortgage-backed securities (MBS) were the second largest holders with $521 billion, or 18 percent of the total.
Looking only at multifamily mortgages, agency and GSE portfolios and MBS held the largest share of the total debt outstanding—$521 billion, or 46 percent of the total—while banks and thrifts held $383 billion, or 34 percent of the total.
“Commercial and multifamily mortgage debt outstanding grew roughly in line with property values in 2016,” said Jamie Woodwell, MBA’s vice president of commercial real estate research. “With property values up eight percent, the amount of mortgage debt outstanding grew six percent. Looking just at multifamily properties, an 11 percent increase in property values was met with a 10 percent increase in mortgage debt.”