Commercial and multifamily mortgage loan originations during the second quarter were up by 12% from the prior quarter and up 16% from one year earlier, according to data from the Mortgage Bankers Association (MBA).
The lending volumes were fueled by a rise in originations for retail, office, hotel, industrial, and multifamily properties. There was a 61% year-over-year surge in the dollar volume of loans for retail properties, a 47% rise for office properties, a 19% increase for hotel properties, an 8% upswing for multifamily properties, and a 6% jump increase for industrial properties.
The sole sector where originations declined was healthcare properties, which recorded a 19% year-over-year drop.
Among investor types, the dollar volume of loans originated for commercial mortgage-backed securities (CMBS) increased by 68% year-over-year. There was a 61% spike in loans for depositories, an 18% increase in investor-driven lender loans, and a 17% leap in loans for the government-sponsored enterprises. The outlier during the quarter was the 27% decrease in life insurance company loans.
“Commercial and multifamily mortgage lending maintained its upward trajectory in the second quarter as improving capital markets and stronger transaction activity supported higher origination volumes,” said Reggie Booker, MBA’s associate vice president of commercial research. “Office lending was strong, with increases in originations on an annual and quarterly basis, signaling renewed financing activity in a sector that has faced significant headwinds. Additionally, CMBS and bank lenders posted particularly strong gains in the second quarter. Although activity remains uneven across some capital sources and property sectors, the overall increase in lending points to continued improvement in commercial real estate finance markets.”
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