Commercial mortgage production during last year was up more than a quarter, and volume came close to reaching the highest level on record.
For all 12 months of 2015, commercial mortgage banking firms originated and closed $503.8 billion in commercial real estate loans.
CRE lending activity was substantially higher than during the previous year, when annual commercial mortgage production amounted to $399.8 billion.
The 2015 details were spelled out in the
2015 Commercial Real Estate/Multifamily Finance Annual Origination Volume Summation from the Mortgage Bankers Association.
“Commercial real estate borrowing and lending in 2015 came within a whisker of the record high level of 2007,” MBA Vice President of Commercial Real Estate Research Jamie Woodwell said in the report. “The volume was driven by improving property fundamentals, strong property values and very low interest rates.”
Commercial banks provided more funding in 2015 than any other source: $138.6 billion.
Another $99.4 billion was funded through commercial mortgage-backed securities.
After that were life insurance companies and pension funds; Freddie Mac; Fannie Mae; and real estate investment trusts and investment funds.
Out of last year’s total originations, $201.7 billion went to fund multifamily loans, the most of any property type.
The next-biggest property type was office buildings, followed by retail, lodging, industrial and health care.
“Despite some credit market disruptions to start off this year and regulatory and other hurdles still ahead, many of those positive factors remain in place,” Woodwell said.
