After several years of tight credit, lenders are competing for commercial property loans again. According to MSCI's August 2026 Capital Trends report, as covered by GlobeSt and CRE Daily on October 1, 2026, average loan-to-value ratios rose to 65.9% in the first half of 2026, up 1.7 percentage points from a year earlier.
Banks are back
Banks' share of commercial property lending rose to 39% from 34%, back in line with their 10-year average. Regional and local banks grew their share to 21% and made 60% of loans of $10 million or less. Debt funds and other investor-driven lenders grew to a 16% share, with the highest average loan-to-value of any lender group at 69.5%. Government agencies' share fell to 17%.
MSCI's Jim Costello cautioned that the data doesn't conclusively show lenders taking on much more risk; part of the increase reflects a return from unusually tight conditions and a shift in the mix of loans.
What it means for owners and buyers
- More options: owners refinancing or buyers financing a purchase have more lenders to choose from than in several years, especially for smaller loans.
- Leverage isn't free: higher leverage can come with higher pricing, tighter terms, and more refinancing risk later. Compare the full cost, not just the loan amount.
- Lenders still underwrite the property: environmental history, open permits, and lease issues still shape what a lender will offer.
Sources
This article is general market commentary for property owners and investors. It is not investment, legal or tax advice. Figures are as reported by the sources above on the dates shown.
