Browse Tag: Mortgage Bankers Association

Commercial Real Estate Mortgage Lending In 2013: Capital Comeback?

Universal Life Insurance Company

New numbers from the Mortgage Bankers Association (MBA) tell a tale of heightened loan origination from commercial banks and life insurance companies to commercial property in 2012.  Will 2013 mark the return of pre-recession levels of capital to commercial property markets?

Commercial/Multifamily Mortgage Bankers Originations Index published by the MBA shows commercial banks produced their highest loan origination volumes since second quarter 2008.  Life insurance companies as a class “have origination volumes greater than before the recession while other lender types are still at below-recession levels” according to a National Real Estate Investor report.

[Many] market observers believe that both banks and life insurers will have closed 2012 with year-over-year increases in commercial/multifamily originations. A December report from Marcus & Millichap Real Estate Investment Services notes that portfolio lenders have been doing more commercial real estate transactions in 2012 than in 2011. Banks, including national, international and regional companies, accounted for roughly 25.5 percent of all commercial real estate loans closed last year, according to research by Marcus & Millichap and Real Capital Analytics, while life insurers were responsible for 18.1 percent of all loans.

When NREI spoke to Dave Clark, senior vice president of real estate with Northwestern Mutual last January, the Milwaukee, Wis.–based life insurer had a goal of increasing its commercial real estate originations by $500 million, to a total of $5 billion in 2012. The firm managed to close 2012 with nearly $5 billion in new transactions, Clark says.

“Our mortgage loan account has done wonderfully well through the downturn, with essentially no losses,” he says. “People are very happy with that performance. Combine [that] with interest rates that are low enough to be attractive to borrowers but are still higher than what you could get on corporate bonds, and I would speculate that life companies will continue to seek relative value in mortgages. This year, our origination goal would probably be 10 percent higher” than in 2012.

(Photo credit: Thomas Hawk)

 

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Mortgage Bankers Association: Strong Upticks In Most Commercial Sectors

U.S. Subprime lending expanded dramatically 20...
Different banking numbers; today’s are sunnier.

Our pinstriped friends over at the Mortgage Bankers Association released the 2Q 2012 Commercial/Multifamily Survey today, and announced a series of positive findings.

In second quarter 2012, MBA’s survey found:

  • Commercial plus multifamily lending was 25% higher  compared to the second quarter of 2011.
  • Commercial plus multifamily lending was 39% higher compared to the first quarter of 2012.
  • Dollar volume of loans for commercial bank portfolios went up over 58% from the second quarter of 2011.
  • A 50% rise in loan volumes for Government Sponsored Enterprises (i.e., Fannie Mae and Freddie Mac).

Additionally, loan dollar volume went up in 2Q 2012 for loans backing:

  • 56% – retail properties;
  • 22% – hotel properties;
  • 19% – multifamily apartment buildings; and
  • 15% – office buildings.

Report: Office loan originations up sharply at +66%

According to MBA’s numbers for loan originations nationaiwde for 2Q 2012, there was a 66% increase for office properties as well as a 47% percent increase for  industrial properties, a 33% percent increase for healthcare properties, a 29% percent  increase for retail properties and a 21%  percent increase for multifamily properties.

The good commercial RE news found its way around the pinstripe-prone community this morning, with coverage at AmericanBanker.com leading the way.

About The MBA

Headquartered in Washington, the Mortgage Bankers Association works to help their members conduct business of single and multifamily mortgage finance by promoting fair and ethical lending practices, fostering professional excellence through educational programs and publications, providing news and information, and holding conferences.

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