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Commercial And Multifamily Lending May Surpass $1T For The First Time In 2022


A new forecast predicts 2022 will be the year mortgage borrowing and lending will surpass $1T for the very first time.

The total volume for commercial and multifamily properties is expected to increase 13% from last year, according to a forecast released this week by the Mortgage Bankers Association.

The record would mean more than just a bounce back from the pandemic-induced dip, exceeding 2019's totals by a significant margin, CoStar first reported.

"Commercial real estate lending volumes are closely tied to the values of the underlying properties. In 2021 those values rose by more than 20 percent, and those increases will fuel further demand for mortgage debt in the coming years," Jamie Woodwell, MBA's vice president for commercial real estate research, said in a press release. 

Woodwell also said increasing investor confidence in rising property incomes will support demand for mortgage capital.

All signs point to a resurgent commercial real estate sector seeing record sales totals. Last year, that total hit a record $809B, far surpassing the record of about $600B set in 2019, The Wall Street Journal reported.

Those records in part came about through record investment in industrial properties. MBA's report found that originations for industrial properties increased by 140% since 2020, fueling a sharp price increase through the end of last year.

The trade association changed its forecast from its previous measure to include mortgages made by small and midsized depositories. That change may have captured more of the growth in the lending space: Banks, CMBS and alternative lenders all contributed more to capital markets in Q4 2021 than in Q4 2020, while life companies almost halved their contributions over the same period, according to data from CBRE.

The CBRE report also showed lending momentum on the rise through the end of last year, with the real estate services and investment firm's Lending Momentum Index up 42% from pre-pandemic levels.