Commercial Loan Debt Declines in 1Q13

There is $2.41 trillion in outstanding commercial and multifamily real estate at the end of 1Q13, a decline of $4.9 billion from 4Q12, according to data compiled by the Mortgage Bankers Association.

This is the first quarter-to-quarter decline since 3Q11.

The decline was mitigated by a $4.1 billion increase in multifamily debt outstanding to $842 billion.

While most types of investors actually increased their holdings of commercial and multifamily debt during the period−the government-sponsored enterprises increased by $3.7 billion and banks and thrifts by $3.1 billion, although life company investments remained flat−commercial mortgage-backed securities holdings fell $4.8 billion and pension funds fell $3.2 billion.

When multifamily is taken as a separate category, the GSE increase of $3.7 billion was the largest, followed by a $2.7 billion increase in bank and thrift holdings. CMBS multifamily holdings fell $3.5 billion.

At the end of 1Q13, banks and thrifts held a 35% share of all CRE/MF debt, followed by CMBS holders at 23%, the GSEs at 16%, life companies at over 13% and all others at less than 13%.

Multifamily alone, the GSEs hold 45%, banks and thrifts hold 28%, CMBS hold 8%, state and local governments hold under 8% and life companies 6%, with all others at 5%.