Commercial and multifamily mortgage bankers closed $399.8 billion worth of loans in 2014, according to the Mortgage Bankers Association’s 2014 Commercial Real Estate/Multifamily Finance Annual Origination Volume Summation.
“Last year was a strong year for commercial and multifamily mortgage borrowing and lending,” says Jamie Woodwell, the association’s vice president of commercial real estate research. “The year saw record origination volumes from life insurance companies and the GSEs [government-sponsored enterprises], and the second-highest level on record for banks. Only 2006 and 2007 recorded higher overall origination volumes. With property fundamentals and values continuing to improve, and interest rates still extraordinarily low, last year’s momentum has carried into the start of 2015.”
Commercial mortgage–backed securities (CMBS) issuers were the leading investor group for whom loans were originated in 2014, responsible for $106.3 billion of the total. Commercial banks saw the second-highest volume, $102.5 billion, and were followed by the following: life insurance companies and pension funds; Fannie Mae; Freddie Mac; and real estate investment trusts (REITs), mortgage REITs, and investment funds.
In terms of property types, multifamily properties saw the highest origination volume, $150.3 billion, followed by office buildings, retail properties, hotel/motel, industrial, and health care. First liens accounted for 97 percent of the total dollar volume closed.
The reported dollar volume of commercial and multifamily mortgages closed in 2014 was 12 percent higher than the volume reported in 2013. Among repeat participants in the survey, the dollar volume of closed loans rose by 6 percent.