Banks cited a range of factors for these changes, including a less favorable outlook for commercial rents, vacancy rates, property prices, and the overall economic landscape. Rising interest rates decreased customer acquisition and development activity, and a less optimistic outlook for rental demand was also identified as a reason for weaker demand.
The tightening of lending standards and terms was evident in various aspects of CRE lending, including wider interest rate spreads, reduced maximum loan sizes, lower loan-to-value ratios, increased debt service coverage ratios, and shorter interest-only payment periods.
Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.
