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Rising Cap Rates Signal Shift in CMBS Lending Landscape

Cap rates climb for most property types in Q4 CMBS lending.

By Erik Sherman | February 25, 2025 at 05:54 AM

Cap rate trends are on the rise, indicating shifting dynamics in the underwriting landscape. This is the conclusion of a CRED iQ analysis of key metrics for new CMBS conduit lending in Q4 2024 compared to Q3 2024 performance. This analysis encompassed 819 properties across 284 loans, resulting in over $7 billion in loan originations for securitizations.

The increase in cap rates is notable across various property types. Office cap rates ranged from 4.60% to 10.50%, with an average of 7.40%, up from 7.16% in Q3 2024. Multifamily cap rates fell between 3.90% and 7.60%, averaging 5.90%, a slight increase from the previous quarter’s average of 5.77%.

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