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Commercial Mortgage Originations Hit Record Level in 2017

The volume of commercial mortgages originated hit a record high of $530.1 billion in 2017, according to data from the Mortgage Bankers Association’s (MBA) Commercial Real Estate/Multifamily Finance Annual Origination Volume Summation.

“2017 was a very strong year, driven by solid property fundamentals, rising property values, low interest rates, and a ready supply of mortgage capital all contributing to extraordinarily attractive finance markets,” said Jamie Woodwell, MBA’s vice president of commercial real estate research. “We expect another robust year in 2018, even with the slight increase in interest rates, although perhaps not quite as robust as 2017.”

According to the report, the reported dollar volume of commercial and multifamily mortgages closed in 2017 saw an 8% increase from 2016, and repeat participants in the survey saw a 7% increase from 2016.

Multifamily property types led the way with origination volume of $233.9 billion, followed by office buildings, retail properties, hotel/motel properties, industrial properties and health care properties.

While 2018 might not be a record-setter, brokers who aren’t already closing commercial mortgages would do well to consider adding these loans to their product offerings. For those looking to increase their income without impeding on their residential business, closing small-balance commercial mortgages is a great choice. With the right lender, closing commercial mortgages within the small-balance niche is easy, quick and profitable.

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