Commercial banks held the largest share of commercial/multifamily mortgages at $1.3 trillion, or 39 percent. Agency and government-sponsored enterprise and mortgage-backed securities were tied as the second largest holders of commercial/multifamily mortgages, at $675 billion or 20 percent of the total, followed by life insurance companies with $509 billion or 15 percent, and commercial mortgage-backed securities, collateralized debt obligations and other asset-backed securities holding $466 billion or 14 percent.
Between December 2017 and December 2018, commercial banks saw a $71 billion gain in dollar terms in their holdings of commercial/multifamily mortgage debt, a six percent increase. At the same time, state and local government decreased their holdings of commercial/multifamily mortgages by $1.1 billion, or one percent. In percentage terms, other insurance companies saw the largest increase with a 12 percent increase in their holdings of commercial/multifamily mortgages, while state and local government retirement funds saw the largest decrease with a 14 percent reduction.
“2018 recorded the largest annual increase in commercial and multifamily mortgage debt outstanding since the Great Recession, and the largest increase in multifamily mortgage debt on record,” said Jamie Woodwell, MBA’s Vice President of Research & Economics. “Growth in multifamily mortgage debt made up almost half the total increase in debt outstanding, and Fannie Mae, Freddie Mac and FHA collectively accounted for two-thirds of the multifamily growth. The GSEs, life insurance companies, the CMBS market and banks all increased their holdings of commercial and multifamily mortgage debt during the year.”
