According to the Mortgage Bankers Association’s (MBA) latest Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations, mortgage loan originations increased 72% in Q1 of 2022, when compared to the same period of time in 2021. In alignment, the MBA notes, with seasonality trends, originations during first three months of 2022 were -39% lower than Q4 of 2021.
Compared to a year earlier, a rise in originations for hotel, industrial, and retail properties led the overall increase in commercial/multifamily lending volumes. By property type, hotels increased by 359%, industrial increased by 145%, retail increased by 88%, health care properties increased by 81%, multifamily increased by 57%, and office increased by 30%.
Among investor types, the dollar volume of loans originated for depositories increased by 194% year-over-year. Life insurance company portfolios increased 81%; investor-driven lenders increased 77%; Commercial Mortgage-Backed Securities (CMBS) increased 56%; and Government Sponsored Enterprises (GSEs – Fannie Mae and Freddie Mac) increased 1%.
In a statement prepared for the release of the survey, Jamie Woodwell, MBA’s Vice President of Commercial Real Estate Research, said:
“The strong momentum in commercial and multifamily borrowing and lending at the end of 2021 carried into the first quarter. The continued growth in lending activity is the result of the ongoing strong demand for certain property types like industrial and multifamily, as well as renewed interest in other property types that saw more dramatic declines during the early stages of the pandemic, such as hotel and retail.
It’s likely that the rise in interest rates will take some wind out of the sails of borrowing in upcoming quarters, but strong market fundamentals, property values and investor interest should continue to support the market.”
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Commercial/Multifamily Borrowing Jumped 72 Percent in the First Quarter of 2022