Originations of commercial and multifamily mortgages were up by nine percent on a year-over-year basis during the first quarter, according to new data from the Mortgage Bankers Association’s (MBA)
. However, the first quarter’s origination levels were 27 percent lower than the fourth quarter of 2016.
The year-over-year spike was fueled by the rise of originations in three sectors: a 40 percent year-over-year boost for industrial properties, a 22 percent upswing for health care properties and a 14 percent increase for multifamily properties; office properties saw a modest two percent uptick in originations. However, hotel property loans decreased by 40 percent while retail property loans declined by 23 percent.
Among investor types, the dollar volume of loans originated for the government-sponsored enterprises increased by 33 percent year-over-year while commercial bank portfolio loans increased 11 percent. But life insurance companies’ loans were flat year-over-year while loans originated for commercial mortgage-backed securities were down 17 percent.
“Commercial real estate borrowing and lending started 2017 on much the same footing it ended 2016,” said Jamie Woodwell, MBA’s vice president of commercial real estate research. “Multifamily properties remain the key force behind overall originations trends, and the GSEs continue to drive multifamily originations. Matching broader investment themes, financing backed by industrial properties also picked up, while retail declined.”