Driven by the government-sponsored enterprises, multifamily lending rose last year, as did office loan originations. But issuance of commercial mortgage-backed securities tumbled.
In the fourth-quarter 2016, commercial mortgage originations came to approximately $153 billion, accelerating from around $128 billion in the previous three-month period.
Commercial real estate loan production, however, descended compared to the fourth quarter of 2015, when CRE lenders made a total of $164 billion in new mortgages.
The estimates were based on an analysis of CRE lending reports issued by the Mortgage Bankers Association.
The trade group reported that full-year 2016 originations
worked out to an estimated $502 billion, modestly off from $504 billion the previous year. MBA predicts that CRE loan production will climb to $515 billion this year.
Multifamily originations at Fannie Mae and Freddie Mac increased 10 percent between 2015 and last year — the biggest year-over-year increase of any investor type — according to MBA’s data.
Washington-based Fannie reported that it provided $55.309 billion in financing last year that was responsible for funding 724,000 multifamily units. Business soared from $42.342 billion in 2015.
McLean, Virginia-based Freddie reported that it financed 738,901 multifamily units for $56.8 billion last year, rising from 650,402 units for $47.3 billion in 2015.
MBA’s data indicate that CRE lending at commercial banks increased 6 percent in 2016 from a year earlier.
Commercial mortgage production at life insurance companies was unchanged last year.
The only investor category in MBA’s report to see a decline was CMBS/Conduits: 15 percent.
By property type, there was a 6 percent-year-over-year increase in multifamily originations and office building financing.
But originations of retail property loans were off by a 10th from 2015, while industrial property financing fell 16 percent, and hotel lending tumbled
23 percent. The biggest decline between 2015 and 2016 was with originations for health care properties: 49 percent.
