Second-quarter 2007 commercial/multifamily originations rise.

Even while up from the previous quarter, commercial and multifamily mortgage bankers' loan originations during the second quarter of 2007 were 40 percent higher than the same period last year--an increase seen across most property types and investor groups, according to the Mortgage Bankers Association (MBA).

MBA's Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations noted that increases in total commercial/multifamily mortgage originations were led by increases in commercial mortgage-backed securities (CMBS) conduit loans and loans financing hotel properties.

The strong second quarter included heavy volume driven by real estate investment trust (REIT) privatizations, and continues a trend of second-quarter-over-second-quarter increases going back to the beginning of MBA's survey in 2001, explained Jamie Woodwell, MBA senior director of commercial/multifamily research.

"A number of large deals helped boost commercial/multifamily origination volumes in the second quarter," said Woodwell. "As a result, the quarter saw significant growth in CMBS and hotel loans. Overall, second-quarter commercial/multifamily originations remained strong despite the initial phases of a general repricing of risk in the commercial/multifamily and other capital markets."

Absent the spate of large hotel deals, overall originations would have increased approximately 27 percent and conduit originations by 42 percent between the second quarter of 2006 and the second quarter of 2007, added Woodwell.

The increase in commercial/multifamily lending activity during the second quarter was driven by increases in originations for most property types.

When compared with the second quarter of 2006, the overall increase included a 330 percent increase in loans for hotel properties, a 34 percent increase in loans for retail properties, a 19 percent increase in loans for office properties, an 18 percent increase in loans for multifamily properties, a 14 percent decrease in loans for health-care properties and a 7 percent decrease in loans for industrial properties.

Among investor types, conduits for CMBS saw an increase of 77 percent compared with last year, a 14 percent increase for government-sponsored enterprises (GSEs), an 11 percent decrease for commercial bank portfolios and a 15 percent decrease in loans for life insurance companies, said MBA.

Meanwhile, second-quarter 2007 mortgage originations were 26 percent higher than originations in the first quarter, according to the MBA numbers. Compared with the first quarter, the numbers showed increases in all property types except office and health care, reported MBA.