The TreppWire Podcast: A Commercial Real Estate Show 386. Escalate to De-Escalate: Bank Capital & Lending Shifts, CRE Fundraising, Construction Cost Pressures, & More
Mar 27, 2026
A fast-paced look at intraday rate volatility and the escalate-to-de-escalate market swings driving treasury and mortgage moves. Clear breakdown of proposed bank capital rule changes and how they could free up CRE lending. Rundown of big CRE deals from a major data center land sale to high-profile office refinancings and a $4.3B construction loan. Notes on rising construction costs and retail portfolio investments.
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CMBS Moves Are Measured But Layered By Credit
- CMBS spreads have widened modestly: new-issue AAA is ~10–15 bps wider while AA/A widen more (AA ~30 bps, A ~40 bps).
- Secondary super-senior 10-year benchmarks moved from upper-70s to ~100 bps, showing larger secondary-market moves.
Rising Construction Costs Are Pausing Large Projects
- Construction costs jumped ~12.6% in the first two months of 2026, prompting major projects like Five World Trade Center to pause.
- Lonnie Hendry highlights sponsors pausing to reassess budgets after cost increases and supply shocks.
Banks Gain On Low Leverage Loans But Not Riskier Deals
- Lower capital charges on conservatively underwritten low-LTV loans will compress spreads and make banks more competitive on that slice of CRE.
- Stephen Bushbaum warns higher-leverage, transitional, and value-add deals likely remain the domain of non-bank lenders.