Commercial real estate borrowers are facing a tougher test as roughly $65 billion in CMBS loans come due by the end of 2026, including about $37 billion with no remaining extension options, according to Bisnow and Trepp data.
The loans were often made when interest rates were much lower. Now, borrowers are facing higher financing costs, stricter underwriting and property values that have fallen in some parts of the market.
More than half of properties with CMBS debt maturing this year may need additional borrower equity to refinance at current rates, according to Trepp. That is putting more pressure on owners to contribute capital, restructure their loans or sell.
Office Is Taking the Biggest Hit
Office properties are particularly exposed. Trepp is tracking 130 CMBS maturities totaling $5.5 billion in August, including five nonperforming loans, all tied to office properties.
CMBS distress reached 7.86% in July, while the office distress rate was much higher at 11.91%. Retail and multifamily properties are also facing refinancing pressure, but office remains the most troubled major property type.
Interest-only office loans face some of the largest refinancing gaps because borrowers may have difficulty generating enough income to support new debt at today’s rates.
More Loans Are Reaching a Final Decision
For years, some owners have relied on extensions while waiting for financing conditions or property values to improve. That strategy becomes harder when a loan reaches a hard maturity with no extension remaining.
Some owners are still finding financing for strong properties. Others are putting in new equity to make deals work. Properties that cannot support refinancing may have to be sold or transferred to lenders.
The growing amount of debt entering special servicing suggests more borrowers and lenders are moving toward actual resolutions rather than continuing to delay them.
2026 Could Force More Price Discovery
The maturity wave could also put more pressure on commercial property values.
When owners refinance or sell at today’s rates and income levels, transactions can establish new valuations for properties that have been carried at older prices. That could create more opportunities for buyers with available capital while forcing owners of weaker assets to recognize larger losses.
The pressure is likely to remain strongest in office, where higher vacancies and changing demand have already complicated the refinancing picture.
With a large share of 2026 maturities still ahead, the remainder of the year could determine how many borrowers can refinance successfully and how many will need to bring in new money, restructure their debt or sell.
