CMBS market projected to grow 20%; Debt trouble returns for mall portfolio; Loan payoffs plunge

This week's column examines a $200 billion target for the CMBS market next year, a regional mall portfolio's debt trouble returning and a sharp drop in loan payoffs. Read the entire piece by clicking "read more" below.

CMBS market projected to grow 20%: After nearly three years of limited transactions, 2026 could mark an inflection point for the commercial real estate market, where loan activity accelerates instead of merely treading water. If that shift occurs, analysts expect it to benefit securitized lending.

The issuance of private-label commercial mortgage-backed securities is projected to climb as much as 20% in 2026 to more than $200 billion, as lower interest rates and greater agreement on price levels drive transactions, according to BofA Global Research. That would surpass this year's volume, one of the highest on record.

BofA projected traditional fixed-rate, long-term CMBS loan issuance would reach $40 billion to $45 billion next year. This year's level is approaching $30 billion, according to CoStar data.

Looking at other securitized loan types, the bank predicts single-asset, single-borrower volume could hit $90 billion to $100 billion. The current 2025 SASB level is approaching $82 billion, according to CoStar. READ MORE

Blue Vista Capital launches $600 million venture to buy self-storage properties

Investment firm Blue Vista Capital Management, an affiliate of banking giant UBS and Extra Space Storage have formed a $600 million venture to acquire self-storage properties nationwide.

The decision comes as major institutional investors have committed more than $1 billion to U.S. self-storage assets in recent weeks. Industry analysts have noted that demographic shifts support long-term demand for self-storage, as baby boomers downsize and younger generations continue to maintain strong storage usage.

Bond rating firm KBRA identified 2025 as an inflection point for the beleaguered sector. Self-storage faced headwinds over the past two years from stagnant home sales and an elevated housing supply following pandemic-era gains. READ MORE

UK real estate and prime offices to lead total returns charge across Europe

Prime real estate returns for 2026 to 2030 across 20 leading European countries will average 8.4% a year, with the UK and prime offices leading the charge, according to real estate investment management giant AEW.

In its 2026 European Annual Outlook, the firm finds the region's real estate recovering slowly but surely, with liquidity returning and prime yields tightening.

At a presentation at AEW's 8 Bishopsgate offices in the City of London, Christina Ofschonka, chief investment officer, Europe, head of Germany and CEE, said: "The valuation falls are broadly behind us and, as with today, we see the sun coming up at some point. We are taking confidence from and making decisions based on the numbers we are seeing. We continue to focus on logistics and residential, but increasingly we are targeting UK offices and we have been able to convince investors, both domestic and from abroad to back this." READ MORE

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