The most recent Commercial/Multifamily Mortgage Debt Outstanding quarterly report from the Mortgage Bankers Association (MBA) shows that the amount of outstanding commercial and multifamily mortgage debt at the end of 2024 was $172 billion (3.7%) more than at the end of 2023.
According to MBA’s study, the total amount of outstanding mortgage debt increased by 1.1% ($50.7 billion) to $4.79 trillion in Q4 of 2024. During Q4 multifamily mortgage debt increased by $38.9 billion (1.8%) to $2.16 trillion, and for the whole year, it increased by $111.0 billion (5.4%).
“Commercial and multifamily mortgage debt outstanding increased to almost $4.8 trillion in Q4 of 2024, up 3.7% compared to last year,” said Mike Fratantoni, MBA’s SVP and Chief Economist. “Multifamily debt now totals almost $2.2 trillion, up 5.4% compared to the last year. Life insurance companies had the fastest growth in commercial debt outstanding over the past year, accounting for almost 39% of the annual increase. By contrast, bank holdings increased by just 1% over the year, with this growth accounting for 10.5% of the total increase.”
The four main investor groups are life insurance companies, federal agency and government sponsored enterprise (GSE) portfolios, commercial mortgage-backed securities (CMBS), collateralized debt obligation (CDO) and other asset backed securities (ABS) offerings, and banks and thrifts.
“For the tenth consecutive quarter, multifamily debt outstanding increased at a faster rate than the overall CRE market,” Fratantoni said. “Almost 56% of the growth in multifamily MDO reflected growth in Agency and GSE portfolios and mortgage-backed securities (MBS).”
Examining U.S. Commercial & Multifamily Mortgage Debt Outstanding
At $1.8 trillion, the biggest portion of commercial/multifamily mortgages (38%) are still held by commercial banks and thrifts. At $1.1 trillion, or 22% of the total, agency and GSE portfolios and MBS are the second-largest holders of commercial and multifamily mortgages. CMBS, CDO, and other ABS issues hold $626 billion (13%), while life insurance companies possess $779 billion (16%).
The largest portion of the total debt outstanding, when considering only multifamily mortgages, agency and GSE portfolios, and MBS, is $1.1 trillion (49% of the total), followed by commercial banks with $629 billion (29%), life insurance companies with $255 billion (12%), state and local governments with $92 billion (4%), and CMBS, CDO, and other ABS issues with $68 billion (3%).
The highest dollar-term growth in commercial/multifamily mortgage debt holdings occurred in Q4 of 2024, with an increase of $31.2 billion (3.0%) in the Agency, GSE, and MBS portfolios. Holdings of life insurance firms rose by $22.7 billion (3%), while those of the federal government increased by $1.2 billion (1.2%), and those of CMBS, CDO, and other ABS issues increased by $6.4 billion (1%). The holdings of commercial banks decreased by $4.5 billion, or a slight decrease of 0.2%.
The highest percentage rise in commercial/multifamily mortgage holdings was 3.0% for agency and GSE portfolios and MBS.
The amount of outstanding multifamily mortgage debt increased by $38.9 billion, or 1.8%, between the third and fourth quarters of 2024. The highest rise in multifamily mortgage debt holdings in monetary terms was $31.2 billion (3.0%) for agency and GSE portfolios and MBS. CMBS, CDO, and other ABS problems boosted their holdings by $282 million (0.4%), while life insurance companies grew their holdings of multifamily mortgage debt by $10.2 billion (4.2%). The assets of state and local governments decreased by $1.6 billion, or 1.7%.
Private pension funds experienced the largest decline in multifamily mortgage holdings (10.9%), while life insurance firms saw the largest gain (4.2%).
Multifamily mortgage debt outstanding increased by $111.0 billion in 2024, or 5.4%. With a 6.2% ($61.8 billion) increase in multifamily mortgage debt holdings, agency and GSE portfolios and MBS experienced the biggest gain in monetary terms. The highest decline in holdings was $419 million (26.4%) for private pension funds.
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