The amount of commercial and multifamily mortgage debt outstanding swelled in the fourth quarter of 2012, marking the largest increase since 2008, according to the Mortgage Bankers Association analysis of the Federal Reserve Board's flow of funds.
Multifamily mortgage debt outstanding rose to $846 billion, increasing $11.8 billion, or 1.4%, from the third quarter of 2012 and up $25.7 billion, or 4.4%, from 2011.
"The appetite among lenders and investors for commercial and multifamily mortgages grew during the fourth quarter," said Jamie Woodwell, MBA’s vice president of commercial real estate research. "The fourth quarter saw the largest increase in commercial and multifamily mortgage debt outstanding since 2008."
He added, "Bank-held commercial mortgages increased by the largest amount since 2008. The balance of loans held in CMBS rose by the most since 2007 and the balances of loans held by life companies and held or guaranteed by Fannie Mae, Freddie Mac and FHA continued their multi-year increases."
In regards to multifamily mortgages, agency and government-sponsored enterprise portfolios as well as mortgage-backed securities hold the largest share of outstanding debt with holdings totaling $376 billion, or 45% of all debt in this category.
In the fourth quarter, agency and GSE portfolios, and MBS also posted an increase in their holdings of commercial/multifamily mortgage debt, rising $17.1 billion, or 2.1%, year-over-year.