MBA President and CEO Bob Broeksmit on Recent Coverage of Uncertainty in Commercial Real Estate Markets
WASHINGTON, D.C. (March 24, 2023) — Bob Broeksmit, CMB, President and CEO of the Mortgage Bankers Association (MBA), issued the following on recent coverage of uncertainty in commercial real estate markets:
“The recent bank closures and evidence of stress in other segments of the financial markets have dominated both press coverage and the conversation here in Washington and around the country.
"Lately, there has been discussion of other “perceived risks” that may be impacting bank balance sheets, including commercial real estate. Unfortunately, some analysis and reporting can lead to perceptions that do not capture the complete picture and exacerbate anxieties during these uncertain times.
"One example is this Wall Street Journal article, which relies on data that defines both small banks and commercial mortgage debt in ways that could lead readers to assume that important parts of the economy – in this case commercial real estate finance and banking – are far more fragile than a closer reading of the numbers would imply.
"A better – and we feel more accurate – way of capturing total assets and commercial real estate debt held by FDIC-insured institutions is in today’s MBA Chart of the Week (see below), authored by Jamie Woodwell, MBA’s Head of Commercial Real Estate Research. As Jamie mentions, MBA strips out many miscellaneous categories to focus on income-producing CRE properties, which is what we think most people generally mean when talking about the commercial real estate market. That, and a more refined view of the broad range of banks in the market, brings greater clarity to the role that smaller banks play in commercial real estate markets, and the role that commercial real estate plays among smaller banks.
"Today’s Chart of the Week is just one example of how MBA is working hard on the advocacy, communications, and research fronts to provide you, regulators, the media, and policymakers with the most updated, accurate information on real estate finance. For more on MBA’s estimates of the volume of loans that will be maturing this year and in coming years, please click here.
"Markets are in flux to be sure, and advocacy and real-time data are essential in uncertain times. We are here to support you. Please continue to contact us with your questions and concerns."