The Mortgage Bankers Association (MBA) forecasts commercial and multifamily will close at $578 billion by the end of 2021, an increase of 31 percent compared with 2020. Last year, commercial and multifamily lending closed at a volume of $442 billion.
“Commercial and multifamily real estate markets are moving past the pain that the COVID-19 pandemic caused in 2020,” Jamie Woodwell, MBA vice president for commercial real estate research, said in a release. “There remain significant differences by property type, but incomes have rebounded strongly and investor interest in real estate and real estate finance is robust. The result is strong property appreciation and increased transaction activity, both of which is fueling financings.”
Multifamily lending alone is projected to set a record at $409 billion in 2021, a 13 percent increase from 2020. This number includes some loans made by small and midsize banks not captured in the overall total. MBA also expects further increases in activity in 2022 and forecasts $597 billion in commercial/multifamily mortgage bankers originations and $421 billion in total family lending.
“MBA’s forecast anticipates the economic rebound to continue this year and next, with real estate benefiting both from a rebound from last year’s lows, and from broader economic growth,” he said. “There remains uncertainty about the impact of new strains of the virus in the fall, but even in a negative scenario – which we don't expect – it is hard to imagine the real estate market having to experience anything like the widespread closures of last year.”