The screws are tightening on CRE loans. For example, multifamily debt originations dropped sharply while CMBS delinquency rates seem to be nearing the beginning of the great slide. And as CRE property values slide, the ability to easily negotiate a refi on a building gets tougher.

Over the past decade, CRE loan origination volumes had trended upwards, according to Trepp. As that is no longer the case, the question becomes "what proportion of the maturing loan market, both in aggregate and in specific markets, could face refinancing challenges in environments where the prevailing interest rate is higher than the loan coupon."

To get closer to an answer, Trepp performed an analysis on maturing loans that by 2024 could land with a debt service coverage ratio (DSCR) based on net cash flow (NCF) of less than 1.25 times (a common risk management threshold), assuming loan coupon escalations.

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