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The Mortgage Bankers Association's Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations reported an 18% decrease in commercial and multifamily mortgage originations in Q4 2020, compared to the same period in 2019.
While commercial and multifamily originations were down year-over-year, it was 76% higher than Q3 2020. Overall commercial and multifamily borrowing was down 30% year-over-year in 2020.
"The last three months of 2020 were stronger than earlier quarters for borrowing backed by commercial and multifamily properties," said Jamie Woodwell, MBA's vice president of Commercial Real Estate Research. "Commercial mortgage loan originations during last year's fourth quarter were 18% lower than a year earlier, but up significantly from the very low third quarter. Borrowing and lending remain weakest for the property types most impacted by the pandemic - particularly hotel and retail buildings. Multifamily, led by government-backed financing from FHA, Freddie Mac and Fannie Mae, continued to see the strongest commercial mortgage activity."
On a quarterly basis, Q4 originations for hotel properties jumped 411% compared to Q3 2020, according to the report. There was a 136% increase in originations for industrial properties, a 111% increase for retail properties, and a 77% increase for multifamily properties. Originations for health care properties increased 77%, and originations for office properties increased 26%.
"Among investor types, 2020 versus 2019, loans for CMBS decreased 58%, originations for commercial bank portfolios decreased 44% and loans for life insurance companies decreased 39%. GSE loans increased 18%," according to the survey.