Multifamily Debt Gets Crowded as Banks Return to the Lending Game

Multifamily borrowers have more places to find debt, but refinancing troubled deals is getting increasingly expensive.

Nina Dale
August 25, 2026

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Good morning. Banks are beating the agencies on some multifamily loans again. As traditional lenders return to the market, borrowers are benefiting from a debt landscape that looks considerably more competitive than it did just a few years ago.

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CRE Trivia 🧠

Which hotel, opened in 1941 by Thomas Hull, was the first resort to open on the Las Vegas Strip?

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Market Snapshot

S&P 500

GSPC

7,652.86

Pct Chg:
-0.28%

FTSE NAREIT

FNER

865.50

Pct Chg:
+0.63%

10Y Treasury

TNX

4.706%

Pct Chg:
-0.032%

CME Term SOFR

1-Month

3.68%

Pct Chg:
-0.00

*Data as of 08/24/2026 market close.

Debt Wars

Multifamily Debt Gets Crowded as Banks Return to the Lending Game

Multifamily borrowers have more lenders competing for their business in 2026, but abundant capital doesn’t mean underwriting has gotten any easier.

Capital is plentiful: Debt availability has expanded considerably, with Fannie Mae, Freddie Mac, private credit, banks and life insurers all chasing multifamily opportunities. Cushman & Wakefield says well-positioned deals are drawing strong lender interest, although properties with operational or underwriting complications can still face a lengthy path to closing.

Refis rule the market: Refinancing remains the dominant source of lending activity as transaction volume continues to recover. At CBRE, roughly 60% of debt placements are refinancings, versus 40% tied to acquisitions, as owners focus on extending maturities and navigating higher borrowing costs.

Banks are back: After retreating amid rising rates and the 2023 banking turmoil, banks are back. CBRE says bank lending is up 30% YoY, while FDIC-insured multifamily loans rose 4.1% to $665.3B. On some deals, banks are beating agencies with borrowing costs 30 to 40 bps lower.

Private credit provides the bridge: Debt funds remain a key lifeline for developers facing maturing construction loans, providing more time to stabilize assets without selling or injecting fresh equity. Some borrowers are even securing cash-neutral refis at better spreads than their original financing.

But extensions are getting expensive: The safety net has limits. Some debt funds that once charged 1% to 3% of the loan balance for extensions may now demand closer to 10%, raising the stakes for borrowers seeking another modification later this year.

Agencies lose some ground: Fannie Mae and Freddie Mac remain competitive for stabilized properties, but their share of CBRE debt placements has fallen from 50%–60% to about 40% as banks and insurers gain ground, particularly on more complex deals.

➥ THE TAKEAWAY

More lenders, more leverage: Multifamily’s debt market has gone from scarcity to competition, giving strong borrowers more financing choices and potentially better pricing. The real test will come from properties that still need time: as extension costs rise, 2026’s abundance of capital may help postpone distress, but it won’t make troubled capital stacks disappear.

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✍️ Editor’s Picks

Claim your free investor portal: Thinking about switching but still under contract? Get Cash Flow Portal free until your current contract ends. (sponsored)
Scarcity advantage: Hines is restarting its development engine as constrained supply, rising rents and stabilizing financing make new projects increasingly profitable across key real estate sectors.
Banking housing: Major U.S. banks are committing billions to boost housing supply, affordability and homeownership while strengthening a mortgage business weakened by low inventory and sluggish demand.
Housing expansion: CoStar has completed its $800M acquisition of Zonda, expanding its reach into new-home data, builder software and residential marketplaces across the $400B U.S. new-home market.
Buying window: Morgan Stanley sees an attractive entry point for CRE as repriced assets, constrained supply and strong demand trends create opportunities in industrial, residential and senior housing.

🏘️ MULTIFAMILY

Leadership shakeup: Fannie Mae’s executive departures are raising concerns that internal restructuring could disrupt the availability, pricing and execution of multifamily financing.
Rental frenzy: San Francisco’s AI-fueled housing boom is driving record rents, bidding wars and fierce competition as limited apartment supply struggles to keep pace with surging demand.
Selective bets: StarPoint Properties is raising its multifamily investment bar, favoring deals with built-in upside and rejecting assets where supply risks could erode future rent growth and appreciation.

🏭 Industrial

Industrial slowdown: U.S. industrial deliveries fell 12% year over year in H1 2026, but major logistics hubs including Dallas-Fort Worth and Houston captured a growing share of new supply.
Power premium: Bay Area industrial properties with high electrical capacity are gaining value as AI and robotics demand power-ready facilities faster than the region can supply them.
Midwest momentum: SparrowHawk and Almanac secured a $236M loan to acquire EQT’s 4.4M SF, 20-property industrial portfolio across six Midwest markets.

🏬 RETAIL

Hawthorne falls: After decades of vacancy and legal troubles, Hawthorne Plaza is being demolished under a court order requiring its owners to redevelop or tear down the long-abandoned mall.
Suburban feast: Wonder is taking its multibrand food hall model to Texas with plans for more than 100 suburban locations across four major metros by 2027.
Retail rebounds: Retail demand returned in Q2 as limited new supply, stable vacancies and rising investment activity strengthened the sector’s outlook, supporting rents and investor interest.

🏢 OFFICE

Office recovery: Office fundamentals are improving as limited new supply and sustained absorption push vacancy lower, though performance increasingly depends on market-specific strengths.
Urban squeeze: Los Angeles’ urban office distress is concentrated in troubled towers, while $1.6B of suburban properties face major-tenant lease expirations that could put their stronger refinancing position to the test.
Lease surge: Brooklyn office leasing more than doubled in Q2, pushing availability to a nearly decade-low 17.2% as large deals and space removals drove positive absorption.

🏨 HOSPITALITY

Beyond gambling: Casinos are reshaping properties with sports, dining, entertainment, wellness and outdoor spaces to attract Gen Z consumers who increasingly prefer digital betting and social experiences.
Event boost: Hotel operators raised 2026 forecasts after strong second-quarter performance fueled by major events and resilient leisure demand, despite geopolitical and economic headwinds.
Hotel momentum: U.S. hotels posted their 18th consecutive week of year-over-year gains, with RevPAR rising 6.2% to $111.29 as San Diego led major markets with a 22.8% surge.

📈 CHART OF THE DAY

Retail demand remains stronger than expected, as robust leasing activity and limited new supply keep fundamentals balanced across major retail REIT portfolios.

El Rancho Vegas. Hull’s property pioneered the hotel-casino resort format — combining lodging, dining, entertainment, and gambling under one roof — that every subsequent Strip developer would imitate.