In the third quarter of 2023, commercial and multifamily mortgage debt outstanding saw a 0.8% increase to reach $37.1 billion, according to the latest quarterly report from the Mortgage Bankers Association (MBA). This brings total commercial and multifamily mortgage debt outstanding to $4.63 trillion by the end of Q3, with a notable rise in multifamily mortgage debt alone at 1.3%, reaching $2.05 trillion.
According to Jamie Woodwell, head of commercial real estate research at MBA, despite a decrease in borrowing activity there has been an ongoing growth in commercial mortgage debt levels due to fewer loans paying off compared to previous periods.
The four largest investor groups include banks and thrifts; federal agency and government-sponsored enterprise portfolios; life insurance companies; as well as CMBS (commercial mortgage-backed securities), CDOs (collateralized debt obligations) and other ABS issues.
This significant increase highlights strong market conditions for CRE financing but also reflects lower sales transactions and refinance volumes leading up until now compared with previous years’ data.
