Commercial real estate is working through the largest refinancing cycle in its modern history, and it is happening quietly, one loan maturity at a time.
The numbers are public and they are large. According to the Mortgage Bankers Association's 2025 Survey of Loan Maturity Volumes, 17 percent of the $5.0 trillion in outstanding commercial mortgages — roughly $875 billion — is scheduled to mature in 2026, with another $652 billion coming due in 2027. Add those together and more than $1.5 trillion of commercial real estate debt has to be dealt with in the next two years. Nearly $957 billion was already scheduled to mature in 2025, much of it pushed there by earlier extensions. MBAMBA Newslink
Why does this matter? Because most of this debt was originated in a different world. Loans written in the mid-2010s and the 2020–2021 window carried rates that no longer exist. Commercial mortgage rates remain well above their pandemic-era lows, so borrowers refinancing maturing debt face substantially higher borrowing costs — and for several years, the market's answer was to extend rather than resolve. That era is ending. MBA's chief economist has noted that lenders are no longer simply extending loan terms, and the maturity wall has begun shrinking for the first time in years — which means resolutions are actually happening now: refinancings at today's rates, recapitalizations, and sales by owners who can't or won't bridge the gap. MBAMBA
Every one of those maturities forces a decision, and forced decisions are where disciplined capital earns its keep.
Here is how we read the reset at SIMM. First, it is a lending opportunity before it is a buying opportunity. The pressure is heaviest exactly where traditional credit has pulled back — 21 percent of depository-held mortgage balances and 29 percent of credit-company and warehouse balances mature in 2026. Borrowers with sound projects still need construction, bridge, and transitional financing, and fewer institutions are providing it. Stepping into that gap in first-lien position, against real collateral, at today's conservative advance rates, is the most direct way to be paid for this moment. MBA Newslink
Second, the reset reprices assets without repricing demand. A property changing hands because its debt matured is not a property people stopped needing. Housing demand in growth markets hasn't gone anywhere — the country remains millions of homes short — and workforce and multifamily fundamentals are driven by household formation, not by where the 10-year Treasury sits this quarter. When capital structure forces sales, buyers with patient capital get to acquire durable demand at a discount created by someone else's balance sheet.
Third, discipline matters more now, not less. A reset punishes optimistic underwriting. Deals that only worked at 2021 rates are exactly the ones coming apart. Our test hasn't changed: basis that works without appreciation, structures where investors are paid first, and a willingness to pass on far more opportunities than we fund. In a market where MBA expects the 10-year Treasury to average around 4.2 percent in 2026, the deals that pencil honestly at today's cost of capital are the only ones worth doing. MBA
The last reset of this scale, in 2008–2012, built many of the strongest track records in private real estate. This one is quieter — no bank runs, no headlines — just a very large stack of loans meeting a very different rate environment, one maturity at a time. The window doesn't announce itself. It just passes.
Sources: Mortgage Bankers Association, 2025 Commercial Real Estate Survey of Loan Maturity Volumes and CREF Forecast (February 2026). Figures are industry estimates, change over time, and are presented for informational purposes only. This commentary reflects SIMM Capital's opinion, is not investment advice, and is not an offer or solicitation of any security. Any offering is made only to verified accredited investors under Rule 506(c) through definitive offering documents.