Key takeaways from MBA CREF 2025

The Mortgage Bankers Association’s Commercial/Multifamily Finance Convention & Expo (MBA CREF) is an important gathering for real estate finance professionals that serves as a barometer for capital markets, investment sentiment, and financing trends. Walker & Dunlop’s team attended the conference, engaging with lenders, investors, and capital providers to gauge where the industry is heading.

This year’s conference, held from February 9-12 in San Diego, revealed an industry adjusting to new dynamics—more capital than deals, tighter spreads, and a push for creativity in deal structuring. Below are the key takeaways from MBA CREF 2025.

More capital than deals: A persistent challenge

Despite concerns about economic uncertainty, capital availability remains strong. “There is absolutely no shortage of debt capital within the capital markets today,” said Riley Manke, Director, Capital Markets. However, transaction volume remains subdued as borrowers hesitate due to high interest rates and valuation gaps. Many borrowers are delaying refinancing their maturing loans for as long as possible as these loans are often 200+bps lower than current rates. On acquisitions, buyers continue to wait for cap rate widening to make deals pencil at current all-in interest rates.

Credit spreads tighten, competition heats up

One of the most striking themes from MBA CREF 2025 was the compression of credit spreads. “Spreads are as tight as I’ve seen since 2021,” noted Justin Nelson, W&D Senior Managing Director. The increased competition among lenders is driving pricing lower, as institutions fight for a limited pool of transactions.

To stay competitive, lenders are offering new incentives, including flexible prepayment structures and risk-adjusted pricing. “Lenders are finding ways to stretch underwriting and take on a little more risk, primarily in the form of lower debt service coverage tests,” Manke added.

Lenders get creative to win deals

With fewer transactions in the pipeline, lenders are adjusting strategies to secure business. “It’s not just a race to the bottom on pricing. Creative structuring matters more than ever,” said Andrew Westling, Director, Capital Markets. Some lenders are expanding their risk tolerance by financing earlier-stage projects. For example, some well-known bridge lenders are willing to come in late during the construction process (mitigating risk on cost overruns) but prior to completion on ground-up multifamily projects to secure lease-up deals.

Sector-specific trends: What’s hot and what’s not

Market sentiment varied across asset classes. Here’s what lenders are focusing on in 2025:

• Multifamily: Agency lending continues to dominate, making it difficult for balance-sheet lenders to compete on pricing. Some institutions are responding with more flexible prepayment structures and floating-rate options.
• Office: There’s a notable shift from last year, with some lenders cautiously re-entering the space. “A handful of lenders mentioned that their credit committees are starting to look at office again,” Manke noted, marking a contrast from last year when office was largely avoided.
• Retail: There is a renewed appetite for retail financing, with interest extending beyond food-anchored centers. “Retail is very well received; even shadow-anchored centers and neighborhood retail are seeing strong demand,” Nelson observed.
• Industrial: Some lenders are slowing down on industrial investments due to concerns over rent deterioration and increased supply.
• Hospitality: A select group of lenders is showing interest in conservative hospitality financing, particularly for well-performing properties in key markets.
• Data Centers: While there is capital available, traditional lenders remain cautious. “Alternative credit players are more active than core balance-sheet lenders in this space,” Nelson noted.

The value of MBA CREF

Though many attendees focus on meetings rather than conference sessions, MBA CREF 2025 remains a critical industry event. “It’s a super-efficient way to get a snapshot of the market in just 48 to 72 hours,” said Nelson. The conference facilitates high-level discussions on lending strategies, capital deployment, and emerging trends. “We talk to these lenders every day, but there’s no substitute for face-to-face meetings,” Manke added, reinforcing the event’s networking value.

MBA CREF 2025 highlighted a market in transition—plentiful capital, competitive lending conditions, and a willingness to take on new risk to secure deals. While challenges persist, the industry is showing resilience and adaptability.

For investors, borrowers, and lenders navigating today’s landscape, staying informed on capital markets trends is essential. Connect with Walker & Dunlop for deeper insights into financing strategies tailored to your needs.