US Commercial and Multifamily Mortgage Debt Outstanding Rises in Q2

According to the Mortgage Bankers Association’s (MBA) latest Commercial/Multifamily Mortgage Debt Outstanding quarterly report, commercial and multifamily mortgage debt outstanding increased 0.9%, or $42.9 billion, in Q2.

Total commercial and multifamily mortgage debt outstanding reached $5.1 trillion at the end of Q2. Multifamily mortgage debt increased 0.9%, or $20.7 billion, from Q1 to $2.3 trillion.

Commercial banks continued to hold the largest share of commercial and multifamily mortgage debt, at 38%, or $1.9 trillion. Federal agency and government-sponsored enterprise (GSE) portfolios and mortgage-backed securities (MBS) held 23%, or $1.2 trillion, followed by life insurance companies at 15%, or $782 billion, and commercial mortgage-backed securities (CMBS), collateralized debt obligations (CDO), and other asset-backed securities (ABS) at 13%, or $651 billion.

MBA noted that many life insurance companies, banks, and GSEs purchase and hold CMBS, CDO, and other ABS issues. Those loans are included in the “CMBS, CDO and other ABS” category in the report.

Commenting on the report, MBA Associate Vice President of Commercial Research Reggie Booker said:

“Commercial and multifamily mortgage debt outstanding continued to expand in the second quarter, reaching a record $5.1 trillion as stronger borrowing activity and capital availability supported growth in the market. Growth was broad-based across the major capital sources, with banks and thrifts, agency and GSE portfolios and MBS, and CMBS, CDO and other ABS all increasing their holdings. Multifamily debt also rose, reaching $2.3 trillion, with agency and GSE financing accounting for half of all outstanding multifamily mortgage debt. The continued increases across these capital sources point to a commercial real estate finance market that is steadily expanding its capacity to support property investment and refinancing activity.”