DOW JONES NEWSWIRES
Commercial and multifamily mortgage loan originations fell in the third quarter, according to a Mortgage Bankers Association survey, amid tight credit conditions and low demand.
The loans were down 54% from the prior year and 12% sequentially.
A pullback in multifamily activity by Fannie Mae (FNM) and Freddie Mac (FRE) outweighed increases in commercial and multifamily lending by life insurance companies and commercial banks, according to Jamie Woodwell, MBA's vice president of commercial real estate research.
Every investor group and property type saw year-over-year declines in origination volume, MBA said. Loans for retail properties slid 62%, the steepest decline amid the groups tracked. Hotel and multifamily properties declined 46% and 40%, respectively.
Still, a few of the mortgage originations improved sequentially, including office and industrial properties. Hotel, health care, multifamily and retail properties all posted sequential declines.
Last month, Moody's Investors Service warned commercial real estate is unlikely to recover soon, saying there were few signs of robust recovery in demand. The ratings agency said the multifamily sector is more positive due to an increase in projected occupancy and shrinking supply.
-By John Kell, Dow Jones Newswires; 212-416-2480; john.kell@dowjones.com