Discipline and Experience – Jan. 26, 2026
For CRE borrowers in 2026, “access to capital will depend on asset quality, sponsor strength and realistic underwriting,” said Lisa Pendergast, president and CEO of the CRE Finance Council
There’s a lot to unpack in the CRE Finance Council’s Fourth-Quarter 2025 (4Q25) Board of Governors (BOG) Sentiment Index survey. Broadly speaking, while the index approaches the high of 126.6 that was set a year ago, that doesn’t mean survey respondents see uniformly smooth sailing ahead.
Conducted in early January, the survey reflected the positive spirit that was evident at the CREFC Miami annual conference a few days later. “This quarter’s results show a market that has moved from recovery to consolidation at elevated levels,” said Lisa Pendergast, president and CEO of CREFC. However, she added that members are going into 2026 with eyes wide open.
“Access to capital will depend on asset quality, sponsor strength and realistic underwriting,” she continued. “The ‘haves versus have-nots’ theme running through the open-ended responses is the defining dynamic heading into 2026.”
Connect CRE’s sister publication, Connect Money, discusses the survey results in greater depth here. For an analysis of the conversation at CREFC Miami, Slatt Capital COO Jason Berry provided these insights to Connect CRE, drawing from the panel discussions.
“While sentiment was broadly constructive, discussions across panels reflected a clear message: 2026 will reward discipline, experience and selectivity as capital availability improves faster than asset fundamentals in certain sectors,” said Berry.
Panelists noted that CMBS and single-asset single-borrower (SASB) loan issuance saw a strong recovery in 2025, mainly driven by SASB deals and CRE collateralized loan obligations (CRE CLOs). Issuance of conduit loans—loans pooled together and sold as securities—also improved, but growth was limited by high interest rates and concerns about the quality of the properties serving as collateral.
“For conduit loan issuance to increase further, there would likely need to be a drop in the 10-year U.S. Treasury yield and more comfort with 10-year loan structures,” Berry said. As it stands, about 70% of conduit loans issued last year were for five-year terms, since many borrowers were hesitant to commit to longer-term fixed rates.
At a high level, said Berry, “The market is splitting into two groups: properties that can easily get new financing, and those that may need restructuring or other solutions. Office buildings make up about one-third of upcoming loan maturities.”
Among property types, data centers represent the belle of the ball at the moment. However, “deal sizes, insurance availability, tenant concentration, power access and obsolescence risk are limiting factors,” at least as far as SASB transactions are concerned. Banks and specialized capital are best suited to these large transactions.
While multifamily fundamentals remain solid, many deals are experiencing stress due to rising expenses driven by inflation. The common elements in problematic deals include “inexperienced sponsors, deferred maintenance and aggressive 2021–2023 underwriting,” said Berry.
He summed up the current outlook from his company’s perspective as follows: “The year 2026 is shaping up to look a lot like 2025—only busier. Capital is available, competition is intense, and lenders have fresh allocations to deploy. Most lenders want to work with experienced sponsors and capital advisors who can present realistic business plans and underwrite properly.
“With increased volume and lean staff, lender capacity is likely to be an issue, further reinforcing the need for the sponsor to work with experienced capital advisors who have strong lender relationships,” Berry continued. “Personal relationships and people continue to drive most deals, which is why CREFC saw record attendance.”