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US Property Debt Wall Shrinks, Lenders Reopen Spigot
10 Feb
Summary
- Commercial property debt maturities are projected to decrease by 9% this year.
- Lenders are increasing loan originations as the real estate market improves.
- The office sector faces $167 billion in mortgage maturities this year.
The significant wall of maturing commercial real estate debt in the US is showing signs of easing, with maturities expected to decline by 9% to $875 billion in 2026. This projection, from the Mortgage Bankers Association, indicates a steady decrease in annual maturities anticipated through 2031, suggesting an improving outlook for the sector.
Following a period of intense pressure due to rising interest rates and sinking property values, lenders are now increasing loan originations by an estimated 27% this year. Property owners are actively refinancing or selling, contributing to a healthier lending environment. Despite these positive trends, older loans, particularly in the hard-hit office sector, are still expected to see increased delinquencies as $167 billion in mortgages mature this year.
The commercial real estate lending market showed improvement in the fourth quarter of 2025, marked by higher loan volumes and increased loan sizes. Investment in commercial real estate also rose by 22% in 2025, reaching $499 billion, indicating growing investor confidence.
