The data pointed to a sustained rebound in lending activity, with strong momentum across key property types and capital sources
Commercial and multifamily mortgage originations surged in the third quarter of 2025, climbing 36% from a year earlier and 18% from the previous quarter, according to the Mortgage Bankers Association’s (MBA) latest survey.
The data pointed to a sustained rebound in lending activity, with strong momentum across key property types and capital sources.
“Commercial and multifamily borrowing has now increased for five straight quarters on both a quarterly and annual basis,” said Reggie Booker, MBA’s associate vice president of commercial/multifamily research.
“Lending activity increased last quarter across most major property types and capital sources, led by particularly strong growth in office, retail, and hotel properties. While some sectors, such as health care and industrial, saw slower activity, overall volumes reflected improving sentiment as property values stabilized and loans reaching maturity were refinanced.”
Office and retail originations posted triple-digit gains
The office sector saw the most dramatic recovery, with the dollar volume of loans for office properties jumping 181% year-over-year.
Retail property originations doubled, up 100% from Q3 2024, while hotel loans climbed 66%.
Multifamily lending also posted a solid 27% increase, and industrial property loans edged up by 5%.
In contrast, health care property originations fell 43% compared to the same period last year.
Investor-driven lenders and GSEs ramped up activity
Investor-driven lenders led the charge among capital sources, with an 83% year-over-year increase in loan volume.
Depository institutions followed with a 52% rise, and government-sponsored enterprises (GSEs) such as Fannie Mae and Freddie Mac boosted their lending by 40%.
Commercial mortgage-backed securities (CMBS) loans rose 5%, while life insurance company loans dipped 4%.
On a quarterly basis, retail property originations soared 141% from Q2 to Q3 2025.
Hotel and office properties saw increases of 76% and 67%, respectively, while multifamily lending rose 12%. Health care and industrial sectors lagged, with declines of 6% and 17%.
Market sentiment improves, but sector risks remain
The latest data underscores a broader trend of renewed confidence in commercial real estate finance, as property values stabilized and refinancing activity picked up. However, the sharp decline in health care originations and modest growth in industrial loans highlight ongoing sector-specific challenges.
The rebound in office and retail lending comes amid continued debate over the long-term outlook for these asset classes, given evolving work and shopping patterns.
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