CMBS Originations Hit Record Low

WASHINGTON, D.C. - Commercial and multifamily mortgage loan originations continued to fall on a year-over-year basis in the second quarter, according to the Mortgage Bankers Association's (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations. Second quarter originations were sixty-three percent lower than during the same period last year. The year-over-year decrease was seen across most property types and investor groups.

"Commercial/multifamily mortgage originations remained low in second quarter," said Jamie Woodwell, MBA's Vice President of Commercial/Multifamily Real Estate Research. "Fannie Mae and Freddie Mac set a new record high; banks, thrifts and life companies are back down from their 2006 and 2007 record paces; and originations for the commercial mortgage backed securities (CMBS) market hit a new record low. The slowdown in originations has come from both a decrease in the supply of capital available and a decrease in the demand for new mortgages. It is likely volumes will remain muted until buyers, sellers, borrowers, lenders and their expectations of rates and terms match closely enough for transaction activity to pick back up."

Decreases in total commercial/multifamily mortgage originations were led by a drop in commercial mortgage-backed security (CMBS) conduit loans. These numbers show the impact of the recent credit crunch and other market disruptions.