CMBS Conduit Loan Rates 2026
What the Bond Market Is Pricing Today
CMBS conduit loan rates in May 2026 range from 5.75% to 7.50% for 10-year fixed non-recourse permanent financing, with pricing determined by the 10-year Treasury yield plus a CMBS bond spread currently running 175 to 250 basis points depending on property type, leverage, and deal structure. Loans are pooled with other commercial mortgages, securitized, and sold as bonds, which means underwriting standards are set by the bond market rather than a single lender's credit committee. Loan sizes typically run from $3 million to well over $250 million, covering office, retail, multifamily, industrial, hospitality, and self-storage assets on a non-recourse basis.
Current Rate Table
Rates shown are indicative ranges based on current market conditions. Your actual rate will depend on your specific property, leverage, and borrower profile. Contact Commercial Lending Solutions for a precise quote.
| Leverage Tier | Rate Range | Notes |
|---|---|---|
| Industrial or Multifamily, 55% to 60% LTV | 5.75% to 6.25% | Tightest spreads, preferred bond collateral, often qualifies for IO |
| Anchored Retail or Self-Storage, 60% to 65% LTV | 6.25% to 6.75% | Stable cash flow assets priced near mid-range |
| Hospitality or Mixed-Use, 60% to 65% LTV | 6.75% to 7.25% | Operator-dependent assets carry wider CMBS spreads |
| Office or Secondary-Market Retail, 55% to 65% LTV | 7.00% to 7.50% | Elevated bond spread reflects current investor risk aversion to office collateral |
Rates are illustrative ranges as of May 2026 and subject to change. All loan programs subject to underwriting approval. Not a commitment to lend.
What Drives CMBS Conduit Loan Rates
Understanding these factors helps you position your deal for the best available rate.
10-Year Treasury Yield
CMBS conduit rates are fixed at origination and float with the 10-year Treasury until closing. A 25-basis-point move in the 10-year translates directly into a 25-basis-point shift in the all-in rate, making rate lock timing a material execution decision.
CMBS Bond Spread
The spread over Treasuries is set by demand from bond investors for the CMBS security, not by the originating lender. B-piece buyer demand, current CMBS issuance volume, and overall credit market conditions drive spreads. In May 2026, spreads on investment-grade conduit issuances are running 175 to 250 basis points over the 10-year Treasury.
Property Type and Collateral Quality
Bond investors apply wider spreads to collateral types with higher perceived default risk. Industrial and multifamily trade at the tight end; office in secondary markets commands the widest spreads. Hospitality and retail spreads sit in between and are sensitive to tenancy and brand strength.
Debt Service Coverage Ratio
Conduit underwriting uses a stressed DSCR, typically requiring 1.25x or better on in-place net cash flow at the loan constant. Lower DSCR at origination limits available leverage and can push the deal into a higher-spread tier or require additional credit enhancement.
Loan-to-Value and Leverage
CMBS lenders size loans to the lesser of 65% to 75% LTV or the DSCR constraint. Deals cleared below 60% LTV often qualify for interest-only periods, reducing debt service and improving DSCR. Higher leverage compresses IO eligibility and widens the spread the B-piece buyer demands.
Prepayment Structure
Conduit loans carry either yield maintenance or defeasance, both designed to protect bondholders from early repayment. Defeasance requires substituting Treasury securities for the collateral. Neither option is cheap, and the cost of exit in years one through nine is a real economic factor in underwriting total deal returns.
Loan Size and Pooling Dynamics
Very large loans (above $100 million) can become concentration issues within a pool and may price wider than smaller loans that diversify easily into a standard conduit deal. Loans below $5 million may face execution risk from conduit lenders with minimum pool-size requirements, sometimes pushing smaller borrowers toward portfolio or balance-sheet alternatives.
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How CMBS Conduit Loan Compare to Alternatives
Choosing the right loan structure can mean a 100 to 300 basis point difference in your cost of capital. Here is how current rates compare across loan types.
| Loan Type | Current Rate Range | When to Use vs CMBS Conduit Loan |
|---|---|---|
| Agency Loans (Fannie Mae or Freddie Mac) | 5.50% to 6.75% | Agency rates are often 25 to 75 basis points tighter than CMBS for qualifying multifamily assets and offer more flexible prepayment structures, including step-down prepay. CMBS covers non-multifamily property types that agencies do not, making it the default permanent execution for retail, office, hospitality, and mixed-use. |
| Life Company Loans | 5.50% to 6.50% | Life companies typically price 25 to 50 basis points inside CMBS conduit on core assets, offer more prepayment flexibility, and allow partial recourse structures. However, life companies are selective on property type and market, concentrate on lower-leverage deals, and have smaller individual allocations. CMBS accommodates a wider range of assets and leverage points. |
| Bank Portfolio Loans | 6.00% to 7.50% | Regional and community banks offer recourse permanent loans with more flexible prepayment (often step-down or open after a lockout), shorter fixed periods (3 to 10 years), and quicker credit decisions. CMBS wins on non-recourse, larger loan sizes, longer fixed terms, and access to higher leverage on cash-flowing assets. |
| Debt Fund Bridge Loans | 8.50% to 11.50% | Bridge financing is transitional and priced 250 to 400 basis points above stabilized CMBS rates. The standard execution path for a value-add acquisition is bridge financing during the lease-up period followed by CMBS conduit takeout once the asset stabilizes and qualifies for permanent fixed-rate debt. |
| SBA 504 Loans | 5.50% to 6.50% | SBA 504 financing covers owner-occupied commercial real estate at competitive fixed rates with 10 or 25-year terms and requires the borrower to occupy at least 51% of the property. CMBS serves investor-owned income-producing properties with no owner-occupancy requirement and substantially larger loan sizes. |
CMBS Conduit Loan Rates 2026: Frequently Asked Questions
What are current CMBS conduit loan rates?
CMBS conduit loan rates in May 2026 range from 5.75% to 7.50% for 10-year fixed non-recourse loans. Pricing is determined by the 10-year Treasury yield plus a CMBS bond spread of 175 to 250 basis points. Industrial and multifamily collateral prices at the tight end; office and hospitality in secondary markets price near the wide end of the range.
How is a CMBS loan rate calculated?
A CMBS conduit rate equals the 10-year Treasury yield at rate lock plus the CMBS spread, which is driven by bond investor demand at the time of securitization. The spread typically runs 175 to 250 basis points on current conduit issuances. Unlike bank loans priced to Prime or SOFR, the all-in rate is fixed at origination and does not adjust over the 10-year term.
Are CMBS loans non-recourse?
Yes. Standard CMBS conduit loans are non-recourse, meaning the lender's recovery in default is limited to the collateral property. Borrowers do sign standard carve-out guarantees covering bad acts such as fraud, environmental violations, and unauthorized transfers, but routine loan default does not expose personal assets. Non-recourse execution is one of the primary reasons sophisticated sponsors prefer CMBS over bank financing.
What prepayment options does a CMBS loan have?
CMBS conduit loans use either yield maintenance or defeasance to protect bondholders from early repayment. Yield maintenance requires paying the present value difference between the loan rate and the current Treasury yield on the remaining balance. Defeasance substitutes a portfolio of Treasury securities for the real estate collateral. Both mechanisms are costly in the first several years of the loan term.
What property types qualify for CMBS conduit financing?
CMBS conduit lenders finance most income-producing commercial property types, including multifamily, industrial, anchored and unanchored retail, office, hospitality, self-storage, and mixed-use assets. Hospitality and office currently carry wider CMBS spreads due to bond market risk sentiment. Raw land, ground-up construction, and owner-occupied properties do not qualify for standard conduit execution.
What loan sizes do CMBS conduit lenders require?
Most conduit programs require a minimum loan size of $3 million to $5 million to cover the fixed costs of securitization and due diligence. There is no practical upper limit, with single-asset CMBS transactions regularly exceeding $250 million. Very large loans above $100 million may be structured as single-asset single-borrower (SASB) deals rather than pooled conduit transactions, which affects pricing and structure.
Can I get interest-only on a CMBS conduit loan?
Interest-only periods of 2 to 5 years are available on CMBS conduit loans for deals that meet minimum DSCR and LTV thresholds at origination. Full-term IO is achievable on lower-leverage, high-cash-flow assets, particularly industrial and multifamily. IO improves current cash-on-cash returns but increases balloon risk at maturity since no principal is paid down during the IO period.
Trevor Damyan is a commercial mortgage broker with $1B+ in loans closed and direct relationships with life insurance companies, CMBS desks, debt funds, and non-QM lenders. Rate data is compiled from active lender conversations and closed transaction experience.
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