Commercial, Multifamily Mortgage Debt Climbs to Record $4.88 Trillion in U.S.
By Michael Gerrity, World Property Journal on September 26, 2025 7:53 AM
Commercial and multifamily mortgage debt outstanding rose by $47.1 billion in the second quarter, reaching a record $4.88 trillion, according to new data released by the Mortgage Bankers Association.
The 1% quarterly gain was fueled by broad-based increases across capital sources, with life insurers and banks leading the expansion. Debt tied specifically to multifamily properties advanced $27.7 billion, or 1.3%, to $2.19 trillion.
"Commercial and multifamily mortgage debt outstanding increased modestly in this year's second quarter," said Reggie Booker, MBA's associate vice president of commercial research. "Every major capital source added to its holdings, but growth varied, with life insurance companies increasing their holdings by 2.4% and banks by 0.9%."
Bank Holdings Dominate
Commercial banks remain the largest investors, holding 38% of outstanding debt, or $1.8 trillion. Agency and government-sponsored enterprise (GSE) portfolios and mortgage-backed securities follow with 22% ($1.08 trillion), while life insurance companies control 16% ($769 billion). Commercial mortgage-backed securities (CMBS), collateralized debt obligations (CDOs), and other asset-backed securities account for another 13% ($643 billion).
Life Insurers Outpace Peers
In dollar terms, life insurers added the most during the quarter, increasing their holdings by $17.7 billion, or 2.4%. Banks and thrifts added $16.3 billion (0.9%), and agency and GSE portfolios grew by $8.7 billion (0.8%). Real estate investment trusts (REITs) also boosted positions, up $1.9 billion (2.2%).
Private pension funds posted the largest percentage jump, at 3%, while state and local government retirement systems cut exposure by 1.9%.
Multifamily Lending Strong
Within multifamily, GSE-backed portfolios and securities remain the dominant force, holding 49% of all outstanding multifamily debt at $1.08 trillion. Banks and thrifts follow with $645 billion (29%), while life insurers' share rose sharply to $256 billion (12%) after a $14.2 billion increase, the sector's largest quarterly gain at 5.8%.
Nonfinancial corporations, by contrast, pulled back sharply, cutting multifamily mortgage holdings by 15.5%.
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