Record $573.9 Billion of U.S. Commercial, Multifamily Mortgage Originations Made in 2018

According to the Mortgage Bankers Association's 2018 Commercial Real Estate/Multifamily Finance Annual Origination Volume Summation, mortgage bankers in the U.S. closed a record $573.9 billion in commercial, multifamily loans in 2018.

Commercial bank portfolios were the leading capital source for whom loans were originated in 2018, responsible for $174.0 billion of the total. The government sponsored enterprises (GSEs) Fannie Mae and Freddie Mac saw the second highest volume, at $142.3 billion, and were followed by commercial mortgage-backed securities (CMBS) issuers, life insurance companies and pension funds, and REITs, mortgage REITs and investment funds.

In terms of property types, multifamily properties saw the highest volume of mortgage bankers' origination volume, at $266.4 billion, followed by office buildings, retail properties, industrial, hotel/motel and health care. First liens accounted for 96 percent of the total dollar volume closed.

"Borrowing and lending backed by commercial and multifamily properties hit another new record last year," said Jamie Woodwell, MBA's Vice President of Commercial Real Estate Research. "Solid fundamentals, growing property values, low interest rates and strong appetites from both borrowers and lenders all helped drive an 8 percent increase in recorded multifamily lending from a year ago. Repeat participants in our survey increased their lending by 4 percent during 2018, with the remaining growth coming from the addition of new firms."

Added Woodwell, "Many capital sources rose to record levels of lending-- including bank portfolios, life insurance companies, and the GSEs (Fannie Mae and Freddie Mac). Among property types, multifamily pulled even further ahead as the dominant lending target, growing to 46 percent of total mortgage banker lending - a series high."

The reported dollar volume of commercial and multifamily mortgages closed last year was 8 percent higher than the volume reported in 2017. Among repeat participants in the survey, the dollar volume of closed loans increased by 4 percent.