NEW YORK CITY—Notwithstanding a sluggish start to 2017, the year's first half nonetheless saw issuance of $34.4 billion in private-label CMBS, Kroll Bond Rating Agency reported earlier this month. That's a 27.8% increase from the year-ago period, and more than half of the year-to-date dollar volume was generated in May and June alone, according to KBRA.

Yet despite what S&P Global Ratings calls “active demand for CMBS” in a new report on structured finance, the report also contains the ratings agency's prediction that the year will finish with total volume basically flat from 2016. What's holding the industry back from breaking through the $100-billion barrier that has eluded it in recent years?

In simplest terms, a changing market. “CMBS have always been unique in that originators not only took time to create pools for issuance, but also made secondary markets that made them even more sensitive to the price movements of the financial crisis,” write S&P analysts James Digney and Deegant Pandya. “That price volatility created significant loan and bond losses for many CMBS originators, causing several to exit the sector and ensuring that the CMBS market that re-emerged in 2010 would have shorter origination warehouse periods.” The result, Digney and Pandya write, was “smaller CMBS pools with greater property type concentrations.”