Commercial real estate lending surged in the first quarter of 2025, driven by higher financing volumes and robust activity from banks, although caution persists due to government policy and economic uncertainty impacting Treasury yields, CBRE said Monday. The CBRE Lending Momentum Index, tracking the pace of CBRE-originated commercial loan closings in the U.S., increased by 13% from Q4 2024 and 90% year-over-year.
Commercial mortgage loan spreads tightened significantly in Q1, averaging 183 basis points. That’s down 29 bps Y-O-Y and one bp from Q4 2024. Multifamily loan spreads narrowed by seven bps to 149 bps, the lowest since Q1 2022, due largely to tighter agency loan spreads.
“Despite persistent and volatile Treasury rates, credit spreads continued to compress, enabling sponsors to pursue early refinancings and accretive debt for acquisitions,” said James Millon, U.S. president of debt & structured finance for CBRE. “The increased investment sales activity created new financing opportunities and established valuations for less liquid asset classes.”
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