Commercial real estate lending closed the fourth quarter up 38.2% from Q3, thanks to higher levels of liquidity, tighter credit spreads and a loosening of some underwriting standards, according to new research from CBRE. 

Commercial loan closings reached a value on CBRE's Lending Momentum Index of 221 in December, an amount that reflects a significant increase from the prior quarter but was still down 16% year-over-year.

 The non-government agency CRE lending market was more balanced in Q4 and looked a little more like conditions CBRE observed pre-pandemic. It included strong participation from alternative lenders, which accounted for 36% of non-agency loan closing volume in the quarter, and life companies for stabilized low-leveraged loans, which gained momentum in late 2020 to snag a market share of almost 30% in the quarter. Alternative lenders like debt funds, finance companies, and mortgage REITs were also the leading source of bridge loans for the office, retail, and multifamily sectors.