I came across a piece by Jarred Schenke at Bisnow the other day, and it spelled out what a lot of us have been seeing: a massive wave of commercial real estate debt—loans made when interest rates were almost free—coming due in 2026. And it’s going to test a lot of owners. Lenders and owners kept deals alive with short-term extensions, mezzanine loans, and private credit. Think duct tape on a leaky boat. It has worked longer than expected… but duct tape has its limits.
What’s happening now is simple: loans from the “cheap money” era are maturing, rates are higher, values have softened in some sectors, and lenders are out of patience. More than $930 billion in commercial loans are set to mature in 2026 alone. That’s not a wave—it’s a tidal surge. SBA 7(a) and 504 loans originated before 2022 are about to reset as well, and those rate jumps are brutal. Many of these loans were written when prime was in the 3–4% range. Today it’s about 7%. That means thousands of business owners—especially restaurants, gyms, service businesses, and retailers—are staring at significant monthly loan payment increases. Add that to rising labor costs, insurance spikes, utilities, food inflation, and relentless regulatory expenses, and the squeeze becomes real. For businesses already running on thin margins, a loan reset isn’t just a financial nuisance—it’s an existential threat.
Sacramento owners aren’t immune. Apartment buildings financed in 2021–2022 are staring at big rate jumps. The office market is dealing with soft demand and lenders who are done ‘pretending and extending.’ Retail and industrial are healthier, but rising rates don’t skip anyone. Actually, Industrial has seen a spike in vacancies, so there may be more stress here as well. With this said, the borrowers who get ahead of this have options. The people who wait will have decisions made for them.
If your loan matures between 2025 and 2027, now is the time for clarity. I’ll run a straightforward, no-nonsense “refi or sell” analysis so you know exactly where you stand. No pressure. Just facts and strategy before the clock runs out.