After nearly two years of steady momentum, commercial and multifamily lending continued its resurgence in the third quarter of 2025, marking the fifth consecutive quarter of growth, according to the Mortgage Bankers Association’s Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations.
Originations rose 36% from a year earlier and increased 18% from the previous quarter, driven by stronger activity across office, retail, hotel and multifamily properties. Office lending soared 181% year-over-year, the largest gain among property types, while retail originations doubled. Hotel loans climbed 66%, multifamily loans rose 27% and industrial originations posted a 5% increase. Healthcare stood out as the lone sector in decline, with originations down 43% from a year earlier.
The third quarter also represented a milestone: total volume exceeded that of the corresponding period in 2022 for the first time, a sign of the sector’s broader recovery after the lending slowdown that followed in late 2023. Earlier this year, origination volumes rose 42% year-over-year in the first quarter and 66% in the second. The last quarterly decline occurred in the final quarter of 2023, when lending fell 25% from the same period in 2022.
By capital source, third-quarter origination changes varied widely. Lending by depositories rose 52%, investor-driven lenders increased 83% and Fannie Mae and Freddie Mac were up 40%. CMBS and conduit loans gained 5%, while life insurance company originations slipped 4%.
On a year-to-date basis, commercial and multifamily originations were up 47% compared with the same period in 2024. Multifamily lending increased 44%, office surged 176%, retail climbed 54%, industrial rose 19% and hotel loans were up 16%. Healthcare lending edged up just 2%. Among lending sources, depositories rose 74% from a year earlier, investor-driven lenders increased 67%, Fannie Mae and Freddie Mac climbed 41%, life companies grew 35% and CMBS originations gained 9%.
“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, in prepared remarks.
“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 healthcare and industrial, saw slower activity, overall volumes reflected improving sentiment as property values stabilized and loans reaching maturity were refinanced.”
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