A new analysis from Trepp — a commercial real estate data and analytics firm — found that U.S. commercial real estate has repeatedly entered periods of distress when acquisition financing accounts for roughly 30% or more of commercial mortgage-backed securities (CMBS) issuance.
Looking at market cycles from 2005 through 2026, the research found the same pattern emerged before the 2008 financial crisis, the late-2010s low-interest-rate boom, and the pandemic-era buying surge.
Office Properties Still Working Through Pandemic-Era Deals
Trepp’s analysis shows today’s office market remains focused on resolving loans made during the 2020–2022 acquisition boom rather than financing new purchases.
By early 2026, the firm identified 252 delinquent or specially serviced office and multifamily CMBS loans from that period, totaling nearly $4.8 billion. Many properties are relying on loan extensions, restructurings, or additional equity as higher interest rates continue to pressure valuations.
Refinancing Replaces New Acquisitions
The market has shifted sharply since the pandemic. Acquisition lending for office and multifamily properties has fallen to roughly 4% to 6% of CMBS issuance in 2026, while refinancing now accounts for nearly 80% of new lending.
The change reflects a market focused on refinancing existing debt instead of bidding up property values through new acquisitions.
A Metric Investors Continue to Watch
Trepp says the 30% acquisition threshold is not a prediction of an imminent downturn but a warning sign that investors may be paying for future price appreciation rather than a property’s current income.
Although acquisition activity remains well below that level today, many office assets purchased during the pandemic continue to face refinancing challenges as elevated borrowing costs weigh on the commercial real estate market.
