Small Decrease in Commercial/Multifamily Debt Outstanding

The level of commercial/multifamily mortgage debt outstanding decreased slightly by 0.1% in the third quarter, to $3.44 trillion, according to the Mortgage Bankers Association's analysis of the Federal Reserve Board Flow of Funds data. The $3.44 trillion in commercial/multifamily mortgage debt outstanding recorded by the Federal Reserve was a decrease of $3.3 billion from the second quarter 2008. Multifamily mortgage debt outstanding grew to $890 billion, an increase of $15.2 billion or 1.7% from second quarter. "Uncertainty surrounding the weakening economy, coupled with the continuing pressures of the credit crunch, led to a slight pullback among investors in commercial/multifamily mortgages in the third quarter," said Jamie Woodwell, MBA's vice president of commercial real estate research. "The government-sponsored enterprises and other finance companies have taken advantage of the limited competition to increase their holdings, but the numbers show banks and thrifts beginning to pull back on their holdings and the CMBS market continuing to pay-down its holdings with few, if any, acquisitions."