🚨🚨🚨🚨🚨
Why This Is Dangerous:
– The CMBS delinquency surge shows credit deterioration = actual defaults!
– The FDIC unrealized loss chart shows valuation deterioration/paper losses👇
– Both stem from higher interest rates and falling asset prices, meaning the stress isn’t… pic.twitter.com/EXMXRBrJ9q— James Sullivan (@SullivanJam) November 6, 2025
– Office property loans show record delinquencies at 11.76%.
– Banks reduce office CRE exposure while biotech real estate slows.
– $936B in U.S. CRE mortgages set to mature next year.
U.S. regional banks‘ commercial real estate loan books are proving broadly resilient despite worries sparked by a handful of soured loans, but the office sector continues to be a pain point, analysts said.
At least eight mid-sized and regional U.S. banks reported lower non-performing loans (NPLs) — loans on which borrowers missed scheduled payments — in their CRE portfolios in the third quarter compared with a year ago, a Reuters analysis of earnings reports showed.
Commercial real estate, mainly office loans, have been under pressure since the COVID-19 pandemic overhauled working habits, and return-to-office mandates have not yet translated into a meaningful rebound in office real estate demand.
Nearly a dozen lenders said they have reduced their concentration of office loans. Flagstar Bank, formerly New York Community Bank, whose CRE troubles sparked a sector-wide crisis of confidence last year, reduced its allowances for credit losses tied to its office portfolio by 142 basis points in the third quarter.
https://journalrecord.com/2025/11/06/us-regional-banks-commercial-real-estate-loans/