MBA Survey: Q2 2009 Commercial/ Multifamily Originations Up from Last Quarter, Down from Last Year

WASHINGTON, D.C. (Aug. 6, 2009) - Second quarter 2009 commercial and multifamily mortgage loan originations were 50 percent higher than during the first quarter of 2009, a quarter with very little activity, but remained 54 percent lower than during the same period last year, according to the Mortgage Bankers Association's (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations.

"Commercial and multifamily mortgage originations continue to feel the effects of the recession and the credit crunch, with volumes 54 percent below last year's second quarter, and 83 percent below the peak seen in the second quarter of 2007," said Jamie Woodwell, (top right photo) MBA's Vice President of Commercial Real Estate Research.

"A 50 percent increase in volumes between the first and second quarter of this year follows a traditional seasonal increase in the second quarter. It also likely signals that commercial and multifamily mortgage originations bottomed in the first quarter of 2009."

SECOND QUARTER 2009 54 PERCENT LOWER THAN SECOND QUARTER 2008

The 54 percent overall decrease in commercial/multifamily lending activity during the second quarter was driven by decreases in originations for all property types.

When compared to the second quarter of 2008, the decrease included an 81 percent decrease in loans for office properties, a 77 percent decrease in loans for hotel properties, a 70 percent decrease in loans for health care properties, a 65 percent decrease in loans for industrial properties, a 51 percent decrease in retail property loans, and a 21 percent decrease in multifamily property loans.

Among investor types, commercial bank portfolios saw a decrease of 83 percent compared to last year's second quarter.

There was also a 57 percent decrease in loans for conduits for CMBS, a 54 percent decrease in loans for life insurance companies, and the dollar volume of loans for Government Sponsored Enterprises (or GSEs - Fannie Mae and Freddie Mac) saw a slight increase of 2 percent.

SECOND QUARTER 2009 50 PERCENT HIGHER THAN FIRST QUARTER 2009

Second quarter 2009 mortgage originations were 50 percent higher than originations in the first quarter. Due to the low base of originations in the first quarter, the percentage increases seen in the second quarter are quite dramatic.

Among investor types, loans for conduits for CMBS saw an increase in loan volume of 471 percent compared to the first quarter, loans for life insurance companies saw an increase in loan volume of 46 percent compared to first quarter 2009, GSEs' volume increased by 39 percent during the same time span, and originations for commercial bank portfolios increased 6 percent from the first quarter to second quarter 2009.

Compared to the first quarter of 2009, second quarter originations for health care properties saw a 173 percent increase.

There was a 129 percent increase for hotel properties, a 93 percent increase for retail properties, a 73 percent increase for multifamily properties, a 28 percent decrease for office properties, and a 46 percent decrease for industrial properties.

CONTACT: Carolyn Kemp, (202) 557-2727, ckemp@mortgagebankers.org