Annual commercial real estate lending moved up last year, while quarterly production ascended to the highest level in over a decade.
CRE loan originations, including commercial mortgages and multifamily loans,
amounted to an estimated $566 billion during all of 2017, more than $491 in 2016.
But this year, CRE loan production is expected to ease compared to last year, with the forecast for 2018 coming in at $549 billion in total volume.
The Mortgage Bankers Association delivered the outlook in its MBA’s Commercial/Multifamily Real Estate Finance Forecast.
Multifamily loans are expected to account for $271 billion of this year’s activity.
Using the MBA’s data along with its Commercial/Multifamily Mortgage Bankers Originations Index, fourth-quarter 2017 CRE production climbed to around $166 billion — the highest level since the second-quarter 2007. Estimated production was $151 billion in the third-quarter 2017 and $149 billion in the fourth-quarter 2016.
MBA’s data indicated that compared to the final quarter of 2016, origination of loans for commercial mortgage-backed securities and conduits jumped 27 percent — more than any other investor time. At Fannie Mae and Freddie Mac, originations were up 17 percent.
A 5 percent decline from the fourth-quarter 2017 was recorded for commercial bank originations, while originations for life insurance companies fell 4 percent.
Origination of loans secured by hotels leapt 40 percent on a year-over-year basis, the strongest showing of any property type. But retail loan originations sank 40 percent during the same period.
