Commercial Mortgage Rates: Week of August 24, 2026

Rate Summary: Week of August 24 through August 28, 2026

It was a relatively quiet week in the capital markets, which, after the volatility of the past several months, qualified as welcome news for borrowers and brokers alike. The 10-year Treasury yield drifted in a tight channel between approximately 4.45% and 4.62%, ultimately closing the week near 4.54%. SOFR (Secured Overnight Financing Rate) remained anchored just above 4.30%, consistent with the Federal Reserve's current pause posture heading into the fall policy calendar. The net result: commercial mortgage rates were largely unchanged week over week, with lenders making only minor spread adjustments across product types.

For sponsors who have been waiting on the sidelines, the environment is beginning to look more workable. Debt service coverage ratios are still the central underwriting constraint for most lenders, but with property income growing modestly in several markets and rates stabilizing, the pencils are starting to sharpen again. That said, the market remains bifurcated. Well-leased, stabilized assets in primary markets are attracting real competition. Transitional deals, secondary-market properties, and anything with near-term lease rollover are still facing a much narrower lender universe and wider spreads.

Treasury Yields and Index Benchmarks

The 10-year Treasury, which serves as the primary pricing benchmark for fixed-rate commercial real estate loans, ended the week at approximately 4.54%. That is roughly 8 basis points lower than where it opened Monday, reflecting a modest flight-to-quality bid after Friday's personal consumption expenditures data came in slightly below consensus. The 5-year Treasury, which many bank and life company lenders use for shorter fixed-rate terms, closed near 4.28%.

On the floating-rate side, 1-month SOFR closed the week at approximately 4.32%, while Term SOFR (30-day) was quoted around 4.34%. These figures matter because bridge lenders, construction lenders, and most debt fund platforms price off SOFR rather than Treasuries. A loan priced at SOFR plus 275 basis points, for example, would carry an all-in floating rate of approximately 7.09% at current index levels, before any rate cap cost is factored in.

The Fed's next Federal Open Market Committee meeting is scheduled for mid-September. Market futures as of Friday afternoon were pricing in roughly a 30% probability of a 25-basis-point cut at that meeting, with the higher probability assigned to a continued hold. The lack of urgency from Fed officials in their recent commentary suggests borrowers should not underwrite a near-term rate cut as a base case.

What It Means for Borrowers

The stabilization in yields is good news in theory, but the practical reality for many commercial real estate borrowers is that rates are still meaningfully higher than the underwriting assumptions baked into deals originated in 2020 through 2022. Refinance stress remains the dominant theme in the market. Sponsors with loans maturing in the next 12 to 18 months need to be proactive, not reactive. Waiting for rates to fall another 50 or 100 basis points before engaging lenders is a strategy that carries real execution risk.

For acquisition borrowers, the calculus is more nuanced. Cap rates in most asset classes have adjusted, but the bid-ask spread between sellers and buyers has not fully closed. Where transactions are occurring, they tend to involve motivated sellers, assumable debt, or all-cash buyers who plan to leverage later. Borrowers pursuing conventional financing need to stress-test their deals at current rates, not at projected future rates, and build in realistic lease-up timelines.

Life company lenders remain the most aggressive fixed-rate execution for long-term, stabilized assets, particularly industrial, multifamily, and grocery-anchored retail. Their spreads have compressed meaningfully over the past two quarters as deal flow has remained below historical norms and they are under pressure to deploy capital before year end. Bank lenders are more selective, with credit committees showing heightened scrutiny of office exposure and interest reserves. CMBS execution is available and pricing has tightened, but the cost of execution, including rating agency fees, B-piece pricing, and closing timelines, means it is not always the right tool for smaller loan sizes.

CRE Loan Rate Ranges by Loan Type

The following ranges are indicative of where lenders are quoting as of the week of August 24 through August 28, 2026. Actual terms will vary based on property type, market, loan-to-value, debt service coverage, sponsor strength, and loan size. These are not quotes or commitments.

• Agency Multifamily (Fannie Mae / Freddie Mac, 10-year fixed): All-in approximately 5.75% to 6.25%, representing spreads of roughly 120 to 170 basis points over the 10-year Treasury. Loan-to-value up to 80% for conventional product; lower leverage tiers are pricing toward the tighter end of that range.
• HUD/FHA Multifamily (223f, 35-year fixed): All-in approximately 5.50% to 5.90%. HUD remains the lowest fixed-rate execution available in the market for qualifying properties, though timeline and MIP costs must be weighed carefully against the rate advantage.
• Life Company Fixed-Rate (5- to 10-year, stabilized assets): All-in approximately 5.85% to 6.60%, with spreads of approximately 130 to 205 basis points over the corresponding Treasury benchmark. Industrial and grocery-anchored retail are pricing toward the tighter end; office remains largely outside life company appetite in most markets.
• CMBS Fixed-Rate (10-year): All-in approximately 6.25% to 7.00%, or roughly 170 to 245 basis points over the 10-year Treasury. Pricing varies significantly based on property type, market tier, and deal structure. Non-recourse execution with interest-only periods available on higher-quality collateral.
• Bank Permanent Fixed-Rate (3- to 7-year term): All-in approximately 6.25% to 7.25%, depending on term, recourse, and property type. Banks continue to price off Treasuries but are adding credit spread for asset classes with near-term uncertainty. Relationship borrowers with deposits at the institution are still accessing better pricing than one-off transactional deals.
• Bridge Loans (floating rate, value-add and transitional): SOFR plus 250 to 425 basis points, producing all-in floating rates of approximately 6.82% to 8.57% at current index levels. Spreads are tightest for light value-add multifamily in primary markets and widest for retail repositioning or office transition deals. Rate caps are typically required and add meaningful carry cost, particularly for caps struck at current strike levels.
• Construction Loans (floating rate): SOFR plus 275 to 475 basis points, or all-in approximately 7.09% to 9.07% floating. Lenders are requiring meaningful equity cushion (typically 30% to 40% loan-to-cost) and are underwriting exit scenarios conservatively. Ground-up multifamily in supply-constrained markets is drawing the most interest from construction lenders; ground-up office is essentially unlendable in most markets.
• Debt Fund and Private Credit (bridge and transitional): SOFR plus 375 to 600 basis points, with all-in floating rates of approximately 8.07% to 10.32%. Debt funds are filling the gap where banks have pulled back, particularly on larger transitional deals, mixed-use assets, and hospitality. Speed and certainty of execution are the key value proposition, and borrowers are paying for it in spread.
• SBA 504 (owner-occupied commercial real estate): The 504 debenture rate for 25-year fixed debentures was quoted this week at all-in approximately 5.60% to 5.80% on the CDC portion. The conventional first mortgage component prices separately, typically all-in approximately 6.25% to 7.00% on a bank fixed or floating basis.

Market Outlook: Looking Into September

The week ahead brings several data releases that could move rates meaningfully. The August jobs report, due the first Friday of September, will carry particular weight given the Fed's dual mandate posture. A softer number would likely push the 10-year Treasury toward the low 4.40s and add conviction to the rate-cut-in-September camp. A stronger-than-expected print would do the opposite, potentially pushing yields back above 4.65% and reinforcing the hold narrative.

Beyond the immediate data cycle, the medium-term picture for commercial real estate debt markets is one of gradual normalization rather than sudden relief. Most capital markets strategists are penciling in a 10-year Treasury that finishes 2026 in the 4.25% to 4.60% range, which would not dramatically change the all-in rate landscape but would help at the margin. The bigger unlock for CRE transaction volume is likely to come from price discovery, meaning sellers coming to market with realistic expectations rather than from rates alone.

Lender sentiment is incrementally more constructive heading into Q4. Several life companies have signaled they are at or ahead of their year-to-date deployment targets, which could mean slightly less aggressive pricing as the year closes. Agency lenders remain active and are motivated to close before year-end volume caps are reached. CMBS conduit pipelines are building, which is a reasonable indicator that deal flow is improving even if volume is still well below peak levels.

Action Items for Borrowers This Week

• If you have a loan maturing in the next 12 months, begin the refinance conversation now. Lender underwriting timelines have stretched, and early-stage conversations cost nothing.
• For acquisition deals in process, stress-test your debt service at current rates plus a 25-basis-point buffer. Do not underwrite a rate cut into your year-one cash flow assumptions.
• If you are considering a bridge loan, get current rate cap quotes before finalizing your business plan. Cap costs at current strike levels can significantly affect total deal economics.
• Value-add multifamily sponsors should explore whether agency execution via Fannie Mae or Freddie Mac's lease-up programs might offer better economics than a conventional bridge-to-perm structure given current spread dynamics.
• Borrowers with floating-rate loans should review their rate cap expiration dates. A number of caps originated in 2023 and 2024 are approaching expiration, and replacement cap costs remain elevated.

Contact CLS CRE at 310.708.0690 or loans@clscre.com for current rate quotes on your deal.