record low interest rates, the Mortgage Bankers Association's (MBA) Commercial
and Multifamily Originations Index fell during the third quarter of 2012. MBA reports that volume was down seven
percent from one year earlier and 17 percent below that in the second quarter
of 2012. Year-to-date originations
however are running 15 percent ahead of the same period in 2011. The Index has improved three-fold since
hitting bottom in the first quarter of 2009 but remains at less half the level
of most quarters between the second quarter of 2005 and the end of 2007.
multi-family component of the index was one of two to increase during the third
quarter. Lending increased by 7 percent
from Quarter Two and 30 percent year-over-year.
Originations for most other types of property covered by the MBA survey
were down from the previous quarter, (Retail -43 percent; Office -29 percent;
Health Care, -25 percent; Hotel -25 percent), industrial lending was the only
other sector to improve, increasing by 8 percent.
sectors fared better on a year-over-year basis with retail and office
properties again having the largest downside, decreases of 35 and 24 percent
respectively. The remainder showed annual increases; 4 percent for hotel properties, and a 19 percent
increase for both industrial and health care properties. The multi-family lending market, with its 30
percent increase may have been assisted by declining
rental vacancy rates and lower homeownership reported by the Census Bureau.
and multifamily mortgage
borrowing slowed in the third quarter,"
said Jamie Woodwell, MBA's Vice President
of Commercial Real Estate Research. "Even
though low interest rates continue to make borrowing extremely attractive, a moderate pace of commercial property sales
transactions and a continued drop in the volume of commercial mortgages maturing
limited the overall
amount of commercial
mortgage loans originated."
investor types, between the second and third quarters of 2012, loans for
conduits for CMBS saw a decrease in volume of 55 percent, loans for life
insurance companies dropped 37 percent, originations for commercial bank
portfolios increased six percent and loans for GSEs increased by 14 percent.
an annual basis, the
dollar volume of loans acquired by life insurance companies dropped 32 percent
from a year earlier. There was an 8
percent increase for commercial bank portfolios and 30 percent for the government
sponsored enterprises Fannie Mae and Freddie Mac. The volume of loans originated for CMBS conduits