Loan Activity for Multifamily Development Up 39% Year-Over-Year
Originally Published by: Multifamily Executive — May 15, 2025
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Commercial and multifamily mortgage loan originations started off strong for 2025, with a 42% year-over-year increase in the first quarter, according to the Mortgage Bankers Association (MBA).
Originations for multifamily properties increased 39% year over year, noted the MBA’s 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% 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.”
In addition to multifamily, office properties saw a 205% year-over-year increase in the dollar volume of loans, while originations for health care and hotel properties saw 159% and 30% bumps, respectively. Originations for industrial and retail properties decreased 2% and 3%, respectively year over year.
The dollar volume of loans originated for depositories increased by 83% in the first quarter year over year, followed by life insurance companies, 61%; commercial mortgage-backed securities, 37%; government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac, 20%; and investor-driven lender loans, 12%.
On a quarter-over-quarter basis, commercial and multifamily mortgage loan originations were down 40% in the first quarter, with multifamily seeing a 41% drop. Office property originations increased 44%, while the other sectors saw decreases. The dollar volume of loans for hotel properties declined 64%; industrial properties, 43%; and health care properties, 34%.
Between the fourth quarter of 2024 and the first quarter of 2025, the dollar volume of GSE loans decreased 51%. Loans for investor-driven lenders declined 49%, while originations for life insurance companies and depositories decreased 40% and 39%, respectively. The dollar volume for CMBS decreased the least by 6%.