Commercial Real Estate Market See Big Jumps in Lending and Loan Demand Per Latest Mortgage Bankers Assocation Quarterly Report


Today, the Mortgage Bankers Association released its analysis of what has been happening in commercial real estate so far this year, and things are looking good.  Today's news stories are finding different aspects of the report upon which to focus, some reporting on the upswing in multifamily mortgage originations, others upon increased demand for things like hotels and retail properties and the like.

Why should anyone give credence to what the Mortgage Bankers Association has to report?

Well, the Mortgage Bankers Association is the organization that represents the real estate finance industry (both residential and commercial) both in Washington D.C. (where the MBA is headquartered) and around the country - its Florida office is in Orlando with local branches based in Broward County, Greater Miami, and the Space Coast

Consider its mission statement

"The Mortgage Bankers Association seeks to create an environment that enables its members to invest in communities and achieve their business objectives. The association creates this environment by developing innovative business tools, educating and training industry professionals, providing a gathering place for the sharing of ideas, acting as the industry's voice on legislative and regulatory issues, and developing open and fair standards and practices for the industry."

The MBA not only provides a place for professional development and networking for those working in the nation's real estate finance industry, it also monitors what is happening within this segment of the economy as well as doing research and studies regarding the future of mortgage banking in the United States.

Which is why the 2012 Report by the Mortgage Bankers Assocation is worth studying. You can read the Second Quarter CMF Study online in pdf format here

What's the Good News that the MBA is reporting? From the report we know, among other things:

1.  Commercial and multifamily lending was 25% higher in the second quarter of 2012 compared to the second quarter of 2011.

2.  Commercial and multifamily lending was 39% higher in the second quarter of 2012 compared to the first quarter of 2012.

3.  The dollar volume of loans in the second quarter of 2012 went up for loans backing:

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

4. Of interest to investors, in the second quarter of 2012 the dollar volume of loans for commercial bank portfolios went up over 58% from the second quarter of 2011.

5. In the second quarter of 2012, there was a 50% jump in loan volumes for Government Sponsored Enterprises (i.e., Fannie Mae and Freddie Mac).


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