Signs of trouble loom in commercial real estate loans

Get out the economic anxiety blankets: Banks nationwide, by a big margin in some cases, are slowing down commercial real estate lending in most property categories, according to a CoStar Group report.

In the analysis, which includes Mortgage Bankers Association data from the 2018 third quarter, CoStar reports banks are getting “squeezed between rising interest rates and competing nonbank lenders” that dangle low-cost loans to expand market share. “It's the first sign of a slowdown in real estate lending by banks this year following the end of an extended period of ultra-low interest rates,” the report states.