MBA: Commercial and Multifamily Debt Down Slightly in Q2

by devteam September 25th, 2012 | Share

The level of commercial andrnmultifamily mortgage debt decreased by 0.4 percent from the first to the secondrnquarter of 2012 according to the Mortgage Bankers Association (MBA).  The outstanding balance of this debtrndecreased by $10.4 billion from the total in the first quarter to $2.37 trillionrnin outstanding debt.</p


Commercial banks continue to holdrnthe largest share of commercial and multifamily mortgages, $815 billion or 34.4rnpercent of the total.  The second largestrnholder is the sector for commercial mortgage-backed securities (CMBS), collateralizedrndebt obligations (CDOs), and asset-backed securities (ABS) which account for 23.4rnpercent.  Agency and government sponsoredrnenterprise (GSE) portfolios and residential mortgage-backed securities (MBS)rnhold 15.2 percent of the debt, life insurance companies 13.5 percent, and staternand local governments 3.6 percent.  Allrnother debt holders account for the remaining 9.9 percent of the debt, arncategory that includes households, the federal government, other insurancerncompanies, finance companies, REITS, and public and private pension funds.  Many of the sectors above also hold CMBS, CDO,rnand other ABS issues and their holdings are included in the CMBS/CDO sector.</p

The largest decrease in holdingsrnof CMBS and multi-family debt was in the CMBS, CDO, ABS sector which decreasedrnby $19.8 billion or 34 percent followed by finance companies, down $5.1 billionrnor 8.4 percent.  The largest percentagerndecrease was in the household sector, down 13.4 percent.  The largest increases were in Agency and GSErnPortfolios and MBS, up $7.10 billion or 2.0 percent while other insurancerncompanies had the largest percentage increase at 4.1 percent.</p

“CMBS loans paid-off, paid-down,rnand were liquidated at a far faster pace than new CMBS loans were originatedrnduring the quarter,” Jamie Woodwell, MBA’s Vice President of Commercial RealrnEstate Research said.  “The drop in CMBSrnbalances more than offset the increases in holdings by Fannie Mae, Freddie Mac,rnand FHA, banks, and life insurance companies.</p

Looking only at multi-familyrnmortgage debt, holdings in the second quarter increased by $5.4 billion or 0.7rnpercent to $826 billion.  The largestrnincrease was in the agency and GSE portfolios and MBS which increased $7.1rnbillion or 2 percent.  Commercial banksrnincreased their holdings of this debt by $3.6 billion or 1.6 percent and liferninsurance companies increased by $576 billion or 1.2 percent.  CMBS, CDO, and other ABS issues decreasedrntheir holdings by $4.8 billion or 5.4 percent.</p

Private pension funds had thernlargest decrease in multifamily mortgage holdings, down 8.6 percent followed byrnCMBS, CDO, and other ABS issues at -5.4 percent.

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