There have been any number of indicators that commercial real estate lending has been falling, from anecdotal reports to the Federal Reserve's senior loan officer survey. Now we can add one more to the list: The CBRE Lending Momentum Index, which tracks the pace of CBRE-originated commercial loan closings in this country, reports lending has fallen 33% in the first quarter from the fourth quarter of last year and 53.5% from a year earlier when loan volume was strong. 

Rachel Vinson, President of Debt & Structured Finance, U.S. for Capital Markets at CBRE, explained the drop this way. "The Federal Reserve's commitment to reduce inflation with aggressive rate hikes continued to heighten market uncertainty through the first quarter," she said, adding, "While plenty of debt capital remains available, increased borrowing costs coupled with credit tightening continues to put downward pressure on lending activity." She also predicted that "borrowers will continue to opt for shorter-term, fixed-rate debt with shortened call protection until volatility begins to normalize."

The Mortgage Bankers Association recently reported similar trends for the first quarter with originations dropping 42% below the prior quarter and 56% down from the same period last year.