Back to All Blog Posts

In 2013, Commercial Mortgages & Multifamily Lending Growing while Retail Property Loans Shrinking

Commercial Mortgage
Posted on 
July 2, 2013

The financial crisis has certainly changed a lot of things for a lot of people, but one thing is certain: it has not affected all sectors of the mortgage market equally. In fact, there are segments of the mortgage market which are thriving so far in 2013 – like the commercial and multifamily lending market, while other segments are not fairing as well.

In the first quarter of 2013, commercial and multifamily lending has increased 9 percent compared to the same time period last year, according to the Mortgage Bankers Association (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations.

“The overall number masks larger increases in the dollar volume of loans originated for commercial mortgage-backed securities (CMBS) and Fannie Mae and Freddie Mac and a decline in the amount originated for life insurance company portfolios,” said Jamie Woodwell, MBA’s Vice President of Commercial Real Estate Research in a press release from the organization.

The increase can be attributed to a decline in overall homeownership rates caused by the financial crisis. Because of this decline, owners of multifamily properties can expect to see an increase in renters. According to the US Census, the renter population between the ages of 24 and 30 is expected to increase from 66 million in 2012 to 70 million in 2025.

So far in the first quarter of 2013, the commercial mortgage market has seen a 35 percent increase in hotels and 30 percent increase in multifamily properties, as well as a 2 percent increase in industrial properties. The industry also experienced a 6 percent decrease in office properties, a 15 percent decrease in health care loans, and a 25 percent decrease in retail property loans.


You might also be interested in