The balance of construction loans SS held by banks increased nearly 15 percent compared with a year ago, reported Chandan Economics, New York.
"In the realm of construction loans, where small and medium-size banks face a more limited set of competitors, growth in total construction exposure is easily outpacing lending on in-place commercial properties," said Chandan Economics Founder Sam Chandan.
All regulated financial institutions file quarterly call reports about their financial condition with the Federal Deposit Insurance Corporation (FDIC) or National Credit Union Administration (NCUA). Chandan analyzed these call reports and said bank lending on multifamily properties increased 12.4 percent and on commercial real estate increased 4.1 percent during the same period.
The balance of commercial real estate loans held on bank balance sheets increased by $13.4 billion during the first quarter to $1.16 trillion, Chandan said--the eighth consecutive quarterly net increase in bank lending on commercial real estate. And banks lending on multifamily assets increased by $8 billion during the quarter to $305.3 billion--the 16th consecutive net increase.
The U.S. Census Bureau reported that construction spending rose 2.2 percent in April to a seasonally adjusted annual rate of $1,006 trillion. It also revised its calculation of February and March spending upward.
Private nonresidential construction spending rose 3.1 percent during the month and...