Fitch: CRE Refinancing Stability Underpinned by Resilient Debt Capital Markets
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U.S. commercial real estate loan refinancing remains “resilient,” with ample liquidity absorbing this year’s elevated maturities, according to Fitch Ratings, Chicago/Toronto.
However, the ongoing office sector correction continues to push commercial mortgage-backed securities delinquencies higher, according to Fitch Ratings’ U.S. Commercial Real Estate CMBS Loan Performance Monitor: 2H25.
Fitch noted it expects rising delinquencies to persist into 2026 due to a possibly slowing economy, uncertainty around tariff and policy impact and a cooling labor market. “However, the pace should moderate, supported by steady new issuance, active modifications and further anticipated rate cuts [from the Federal Reserve],” the report said.
This year’s repayments tracked last year’s level as strong liquidity and a more stable interest rate environment supported refinancing conditions, Fitch said. Through the third quarter, the ratings firm tracked $28.8 billion (1,723 loans) of non-defaulted, non-defeased U.S. CMBS conduit and Freddie Mac loans maturing in 2025. “Of these, borrowers repaid $19.9 billion (1,444 loans), for a 69% refinance rate by balance (84% by count), comparable to 68% and 84%, respectively, in 2024. Retail and hotel repayments slowed, while office gained momentum.”
Fitch’s projections incorporate refinance stress testing on 2026-2027 maturing conduit and Freddie Mac loans, assessing performance against debt service coverage ratio and loan-to-value thresholds at current market capitalization rates, interest rates and insight from recent CMBS transactions.
Looking ahead to 2026, Fitch said it projects overall refinancing will remain broadly in line with this year, with 69% by balance (78% by count) meeting its refinance stresses. “We also expect office and retail activity to improve, with higher urban office and regional mall repayment rates following multiple weak quarters,” the report said.
