Commercial/Multifamily Borrowing Increases 42% In The First Quarter Of 2025
Commercial and multifamily mortgage loan originations were 42 percent higher in the first quarter of 2025 compared to a year earlier, and decreased 40 percent from the fourth quarter of 2024, according to the Mortgage Bankers Association’s (MBA) Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations.
“Commercial and multifamily mortgage originations posted a strong rebound in the first three months of the year, increasing 42 percent compared to year-ago levels,” said Reggie Booker, MBA’s Associate Vice President of Commercial Research. “The first quarter of the year is typically the slowest, so this level of activity — particularly the strong gains in office, health care, and multifamily lending — signals renewed momentum and growing confidence in key segments of the market. Despite ongoing volatility in interest rates and the broader financial markets, borrowers and lenders are finding opportunities to move new deals forward.”
Compared to a year earlier, a rise in originations for office, health care, and multifamily led to an overall increase in commercial/multifamily lending volumes. There was a 205 percent year-over-year increase in the dollar volume of loans for office properties, a 159 percent increase for health care properties, a 39 percent increase for multifamily properties, and a 30 percent increase for hotel properties. Originations for industrial properties decreased 2 percent, and retail property loan originations decreased 3 percent compared to the fourth quarter of 2024.
Among investor types, the dollar volume of loans originated for depositories increased by 83 percent year-over-year. There was a 61 percent increase in loans for life insurance companies, a 37 percent increase in commercial mortgage-backed securities (CMBS) loans, a 20 percent increase in government sponsored enterprises (GSEs – Fannie Mae and Freddie Mac) loans, and a 12 percent increase in investor-driven lender loans.
On a quarterly basis, first quarter originations for retail properties decreased 66 percent compared to the fourth quarter of 2024. There was a 64 percent decrease in originations for hotel properties, a 43 percent decrease for industrial properties, a 41 percent decrease for multifamily properties, and a 34 percent decrease for health care properties. Originations for office properties increased 44 percent compared to the fourth quarter of 2024.
Among investor types, between the fourth quarter of 2024 and first quarter of 2025, the dollar volume of loans for GSEs decreased 51 percent, loans for investor-driven lenders decreased 49 percent, originations for life insurance companies decreased 40 percent, loans for depositories decreased 39 percent, and the dollar volume of loans for CMBS decreased by 6 percent.
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