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Commercial Mortgage Market Expected to Remain Strong in 2016

Commercial Mortgage
Posted on 
January 14, 2016

An increase in commercial and multifamily lending is expected in 2016 according to a Mortgage Bankers Association (MBA) survey which shows that lenders’ and borrowers’ appetites for new loans will stay robust.

“Commercial mortgage lenders anticipate another competitive year in 2016, as lender desire to make loans remains strong,” said Jamie Woodwell, MBA’s Vice President for Commercial Real Estate Research. “With strong market fundamentals and the 10 year loans made during 2006 and 2007 maturing this year and next, lenders also anticipate strong demand from borrowers. This is a similar to last year’s strong forecast for the commercial mortgage market in 2015.

Here is what MBA learned from surveying the top commercial and multifamily origination firms:

  • For 2016, 90% of the top firms expect originations to increase, with 50% expecting an increase of 5% or more and 61% expecting their own firms’ originations to increase by 5% or more.
  • Lenders are looking to make more loans with 61% reporting that in 2015, lenders have a “very strong” appetite for new loans. Nearly 60% believe this trend will continue into 2016.
  • Lenders also believe that borrowers are eager for new commercial mortgages, with 52% reporting that borrowers had a “very strong” appetite to take out new mortgages in 2015. Nearly half of the firms surveyed expect this trend to continue into 2016.
  • Many originators surveyed stated that their own firm’s appetite to make new loans was “very strong.” 65% of originators surveyed expect their own firm’s appetite to be “very strong” in 2016, mirroring 2015’s numbers.
  • Overall, originators anticipate that the commercial and multifamily mortgage industry will grow at a strong pace. Half of those surveyed expect total market originations to increase 5% or more in 2016, and 61% expect their own originations to increase by 5% or more.

With such a positive outlook for the commercial and multifamily mortgage market, 2016 is the time to begin closing small-balance commercial mortgages if you haven’t already started. Both lender and borrowers have a strong appetite for commercial and multifamily loans, and brokers who choose to work with them can expect a strong 2016, as well.

APEX has been closing small-balance commercial mortgages for over 25 years. For more information about how we can help you and your borrowers, call 800-262-2739 or contact us online.


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