MBA Chart of the Week: Commercial, Multifamily Interest Rates

Source: MBA CRE Mortgage Credit Availability Index (MCAI)

The 10-year Treasury rate has jumped to 4.5% due to the spike in inflation. With the job market holding steady, the Federal Reserve’s next move is likely to be a rate hike, with MBA’s forecast predicting a first hike in mid-2027. Furthermore, the increase in rates is impacting on financing costs for commercial real estate.

This week’s Chart of the Week examines how the current rate environment is feeding into CRE lending rates across four major property types. The graph uses data from MBA’s monthly CRE Mortgage Credit Availability Index, and reports quoted rates at origination for Multifamily, Office, Retail, and Industrial properties from late 2023 through mid-2026. The quotes are for mortgages with a loan-to-value ratio of 65 percent and a debt service coverage ratio of 1.35 at origination.

The figure shows that median rates across all four property types troughed in late 2024 and early 2025, briefly approaching 5.5%. Rates decreased throughout 2025, bottoming out in March of 2026. However, between March and May, we have seen an upward of 75 basis point increase in median rates across property types. This is likely due to the rapidly changing economic environment since the start of March.  

MBA expects CRE lending rates to remain elevated absent a significant weakening of the job market. MBA Research forecasts increased origination volume for non-residential CRE and a slight decline in multifamily lending in 2026.

– Judith Ricks, Ph.D. (jricks@mba.org)

– Dianna Takacs, CRE Research Analyst (dtakacs@mba.org)