A rise in originations for hotel, multifamily, and industrial properties led the overall increase
Originations of commercial and multifamily mortgages increased slightly during the first quarter from the year-ago period, led by a rise in originations for hotel, multifamily, and industrial properties, according to the Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations released by the Mortgage Bankers Association (MBA).
First-quarter originations increased 1% compared to the same period last year. Meanwhile, first-quarter originations dropped 33% compared to the fourth quarter in line with the seasonality of market.
"Borrowing and lending backed by commercial real estate is starting 2018 at roughly the same pace at which it started 2017," said Jamie Woodwell, MBA vice president of commercial real estate research. "The property types drawing the most attention of late continued to follow different paths, with retail originations declining while multifamily and industrial increased. It was the strongest first quarter on record for originations of loans for life insurance companies and the GSEs, Fannie Mae and Freddie Mac."
On a year-over-year basis, the quarter saw a 54% increase in the dollar volume of loans for hotel properties, an 18% increase for multifamily properties, and a 14% increase for industrial properties. The dollar volume of loans declined 39% for health care properties, 27% for retail properties, and 1% for office properties.
The dollar volume of loans originated for CMBS increased by 12% year-over-year. Loans for life insurance companies grew 9%, while Fannie and Freddie loans gained 8%. Loans originated for commercial bank portfolios loans decreased 23%.
Compared to the fourth-quarter, hotel properties decreased 53%. The quarter also saw originations decrease 41% for health care properties, 37% for retail properties, 32% for office properties, 28% for multifamily properties, and 13% for industrial properties.
Among investor types, the dollar volume of loans for CMBS decreased 47% quarter over quarter. GSE originations dropped 35%, while loans for commercial bank portfolios decreased by 34%. Loans for life insurance companies decreased 18%.
