The level of outstanding commercial real estate debt continued to expand during the second quarter.market may be frozen, but the
Commercial and multifamily mortgage debt outstanding rose 1.5% in the second quarter, to $3.44 trillion, the Mortgage Bankers Association reports, based on an analysis of the Federal Reserve Board Flow of Funds data.
Amid the current credit crunch turmoil, commercial andmortgage debt outstanding gained $51.3 billion from the first quarter of 2008. Multifamily mortgage debt outstanding alone grew to $875 billion, an increase of $16.3 billion or 1.9% from first quarter levels.
"Despite the persistent credit crunch, investors increased their holdings of commercial/multifamily mortgages in the second quarter," says Jamie Woodwell, MBA's Vice President of Commercial Real Estate Research. "The only major investor group to see a decline in their holdings was the commercial mortgage-backed securities (CMBS) market, which has been most profoundly affected by the credit crunch. Other investor groups including, life insurance companies, thrifts and the government-sponsored enterprises (GSEs) increased their holdings over the quarter."