While all major capital sources increased their holdings of commercial and multifamily mortgages during the quarter, Woodwell noted that nearly two-thirds of the overall growth came from multifamily properties. Furthermore, he said that 80% of that multifamily growth came from agency and GSE mortgage-backed securities and portfolios.

The largest holders of commercial/multifamily mortgages were banks (38% market share) at $1.5 trillion. Agency and GSE portfolios and MBS followed with 22% share at $861 billion. Life insurance companies held $588 billion (15%), while commercial mortgage-backed securities (CMBS), collateralized debt obligation (CDO), and other asset-backed securities (ABS) issues held $540 billion (14%).

“As the uncertainty from the COVID-19 pandemic wanes, lenders will have greater clarity into the different properties and property types and be in stronger positions to make new loans,” Woodwell said.