Commercial/Multifamily Borrowing Increased 3 Percent in the Second Quarter of 2024

WASHINGTON, D.C. (August 15, 2024) - Commercial and multifamily mortgage loan originations increased 3 percent in the second quarter of 2024 compared to a year ago, and increased 27 percent from the first quarter of 2024, according to the Mortgage Bankers Association's (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations.

"Borrowing and lending backed by commercial real estate remained subdued in the second quarter," said Jamie Woodwell, MBA's Head of Commercial Real Estate Research. "Most capital sources remain ready, willing and able to lend on properties that can support a loan. Driven by growth in the single-asset single-borrower markets, originations for CMBS grew significantly during the quarter."

Added Woodwell, "With interest rates moderating and a large slug of loans maturing, it is likely we'll see more borrower activity in the coming quarters."

ORIGINATIONS INCREASED 3 PERCENT IN THE SECOND QUARTER OF 2024

Originations in the second quarter of 2024 varied across the different property types. There was an 172 percent year-over-year increase in the dollar volume of loans for hotel properties, a 77 percent increase for industrial properties, and a 50 percent increase for health care properties. Retail property originations decreased 7 percent, multifamily properties decreased 14 percent, and there was a 29 percent decrease for office properties.

Among investor types, the dollar volume of loans originated for commercial mortgage-backed securities (CMBS) increased by 154 percent year-over-year. There was a 17 percent increase for investor-driven lenders, an 11 percent increase for life insurance company loans, but a 26 percent decrease in loans for depositories, and a 20 percent decrease for government sponsored enterprises (GSEs - Fannie Mae and Freddie Mac) loans.

SECOND QUARTER 2024 ORIGINATIONS UP 27 PERCENT FROM THE FIRST QUARTER 2024

On a quarterly basis, in the second quarter of 2024 originations for health care properties increased 178 percent compared to the first quarter of 2024. There was an 84 percent increase in originations for hotel properties, a 29 percent increase for industrial properties, a 27 percent increase for multifamily properties, originations for retail properties increased 18 percent, and the dollar volume of loans for office properties increased 4 percent.

Among investor types, between the first and second quarters of 2024, the dollar volume of loans for life insurance companies increased 60 percent, loans for depositories increased 21 percent, originations for CMBS increased 21 percent, loans for investor-driven lenders increased 20 percent, and the dollar volume of loans for GSEs increased by 16 percent.

To view the report, please visit:: https://www.mba.org/news-and-research/research-and-economics/commercial-multifamily-research/quarterly-commercial-multifamily-mortgage-bankers-originations-index.

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