Lenders Still Lending for Apartments, But at Much Lower Volume
- Oct 18, 2010
Dees Stribling, Contributing Editor
Washington, D.C.–The Mortgage Bankers Association reports that aggregate lending for financing apartment properties nationwide shrank about 40 percent in 2009 compared with 2008. At the same time, however, most of the same lenders were able to keep lending, albeit at lower transaction and dollar volumes.
According to the organization’s new “Report on Multifamily Lending for 2009,” some 2,725 different multifamily lenders provided a total of $52.5 billion in new financing for U.S. apartment buildings with five or more units. The most active 122 lenders represented just 4 percent of total number of active lenders, but 77 percent of the dollar volume lent.
In terms of total dollar volume, the top five apartment lenders in 2009 were Wells Fargo Bank N.A., PNC Real Estate, Deutsche Bank Commercial Real Estate, CBRE Capital Markets Inc., and Capmark Financial Group Inc., notes the report.
Three-quarters of the active lenders made five or fewer loans over the course of the year, but the remarkable thing is that they were still making loans despite the exceptionally difficult economic conditions of 2009. “The multifamily market has always been diverse, and that continued to be the case even in the midst of the recent recession,” Jamie Woodwell, MBA’s vice president of commercial real estate research, tells MHN.
“As we’ve seen in previous years, in 2009 a wide range of lenders made loans to finance multifamily properties around the country,” he continues. “Some lenders made just one or two multifamily loans and some made thousands; some loans were for hundreds of thousands of dollars and some were for tens or hundreds of millions.”
Annual Report on Multifamily Lending for 2009 includes a listing of the lenders who made multifamily loans in 2009, specifying their lending volume, number of loans made and average loan size. It also profiles distinct market segments within the multifamily lending community, including the very-small loan (loans of $1 million or less) lender segment, which lists the metro areas and the volume of very-small loans made in 2009.
The report is based on data from the MBA 2009 Commercial Multifamily Annual Origination Volume Summation and the Home Mortgage Disclosure Act (HMDA). The MBA survey targets specialized commercial/multifamily originators and covered $82 billion in commercial/multifamily loans in 2009. The HMDA data adds multifamily loans from banks, thrifts and other institutions that meet certain single-family origination thresholds. When combined, the two datasets provide a comprehensive assessment of the multifamily mortgage market.