Commercial and Multifamily Borrowing Declines 56% in 2023Q1

The Mortgage Bankers Association (MBA) announced Tuesday (5-9-23) the results of its Quarterly Survey of Commercial/Multifamily Mortgage Bankers Organizations. According to the report, commercial and multifamily mortgage loan originations in 2023Q1 were 56% lower year-over-year and 42% below 2022Q4.

Among investor types, between 2022Q4 2022 and 2023Q1, the dollar volume of loans for life insurance companies dropped 56%; loans for depositories decreased 48%; organizations for investor-driven lenders decreased 42%; and loans for GSEs declined 40%. The dollar volume of loans from CMBS increased by 99%.

Providing additional background and his analysis, Jamie Woodwell, MBA’s Head of Real Estate Research, said:

“While the first quarter is typically the quietest quarter of the year, borrowing and lending backed by commercial and multifamily properties declined in the first quarter to the slowest pace since 2014. Uncertainty and volatility in regard to interest rates and property values, and supply and demand imbalances for some property types, has led to a logjam in commercial real estate sales and financing markets.

As loans mature and adjustable-rate loans reset, we should start to get greater insight into where things stand.”