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CREFC announces Test

July 2, 2025

CREFC Announces new TEST

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First 100 Days: Cabinet Nominee Update

February 4, 2025

President Donald Trump’s cabinet nominees are in various stages of the confirmation process with nine officials confirmed by the Senate in the last week and others awaiting a Senate vote or confirmation by committee.

A comprehensive tracker of President Trumps’ entire slate of cabinet nominees can be found here.

Confirmed Cabinet Nominees

• Secretary of State Marco Rubio was confirmed by the Senate with a unanimous vote on Jan. 20.
• Director of the Central Intelligence Agency John Ratcliffe was confirmed on Jan. 23, by a 74-25 vote.
• Secretary of Defense Pete Hegseth was confirmed by the Senate on Jan. 25, in a narrow 51-50 vote that saw Democrats and three Senate Republicans voting against him: Lisa Murkowski (R-AK), Susan Collins (R-ME), and Mitch McConnell (R-KY). These Republican defections made it necessary for Vice President JD Vance to cast the tie-breaking vote to confirm his nomination.
• Secretary of Homeland Security Kristi Noem, former South Dakota governor, was confirmed on Jan. 26, by a margin of 59-34, with seven Democrats joining Republicans in confirming her nomination.
• Secretary of the Treasury Scott Bessent was confirmed by the Senate on Jan. 27 in a 68-29 vote.
• Secretary of Transportation Sean Duffy, the former Congressman (R-WI), was confirmed by the Senate on Jan. 28 by a vote of 77-22.
• Environmental Protection Agency Lee Zeldin. The former Congressman (R-NY) was confirmed by the Senate on Jan. 29 by a vote of 56-42.
• Secretary of Interior Doug Burgum. The former Governor (R-ND) was confirmed on Jan. 30 by a vote of 79-18. 
• Secretary of Energy Chris Wright was confirmed by the Senate on Feb. 3 by a vote of 59-38. 
  
   

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Capital Markets Update Week of 2/4

February 4, 2025

Private-Label CMBS and CRE CLOs

Four transactions totaling $3.6 billion priced last week:

• HGMT 2025-HGLR, a $1.2 billion SASB backed by a fixed-rate, 10-year loan for a joint venture between Simon Property Group and Institutional Mall Investors to refinance the Houston Galleria super-regional mall.
• FSRIA 2025-FL10, a $1 billion CRE CLO from FS Credit REIT, comprised of 23 loans secured by 59 properties. The pool’s top property type concentrations are multifamily (45.6%), industrial (21.9%), and hotel (18.9%).
• BX 2025-DIME, a $950 million SASB backed by a floating-rate, five-year loan (at full extension) for Blackstone to finance the recent acquisitions of 57 industrial properties in seven states.
• NY 2025-299P, a $435 million SASB backed by a fixed-rate, 10-year loan for Fisher Brothers and Alaska Permanent Fund to refinance 299 Park Avenue in Midtown Manhattan.
  
   

By the numbers: Year-to-date, private-label CMBS and CRE CLO issuance totaled $13.3 billion, nearly double the $6.8 billion for same-period 2024.

CMBS/CRE CLO Spreads Hold Steady

• Conduit CMBS AAA and A-S spreads were unchanged at +71 and +105, respectively, as were AA and A spreads at +130 and +160, respectively. 
• Conduit CMBS BBB- spreads were unchanged at +415.
• SASB CMBS AAA spreads were unchanged in a range of +90 to +110, depending on property type.
• CRE CLO AAA and BBB- spreads were unchanged at +125 / +130 (Static / Managed) and +350 / +365 (Static / Managed), respectively. 
  
   

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CREFC Launches Two New Committees to Strengthen Industry Advocacy and Legal Insight

February 4, 2025

CREFC is pleased to announce the formation of two new member-driven committees:

• Advocacy Committee and 
• Legal Advisory Council

Both committees will enhance CREFC’s ability to navigate legislative and regulatory changes and provide critical industry guidance. 

Why it matters: These new groups will play a key role in helping CREFC respond to evolving legal, legislative, and policy developments under the new administration.

The newly formed Advocacy Committee complements CREFC’s existing Policy Committee by broadening participation in discussions around legislative and regulatory developments.

• This expanded engagement will allow more members, both Forum leadership and other industry stakeholders, to weigh in on critical policy issues.
• With the new administration and Congress expected to introduce significant regulatory changes, including targeted deregulatory efforts, along with new legislation, the Advocacy Committee will serve as an essential platform for gathering industry input and shaping CREFC’s response.
• The Advocacy Committee is open to all CREFC members.

• By offering a legal perspective on a wide range of topics, the Council will ensure that CREFC’s advocacy efforts remain well-informed and strategically focused.
• The Legal Advisory Council is open to all CREFC members who are attorneys (e.g., law firms, internal counsel).

According to Lisa Pendergast, CREFC’s President and CEO:

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Spotlight on Freshmen in the House Financial Services Committee 

February 4, 2025

Seven freshman Representatives have joined the House Financial Services Committee (HFSC), a coveted post for new Members of Congress. The committee has wide influence over the economy through its oversight of financial regulators, capital markets, housing, insurance, and monetary policy. 

The following is a summary of the freshman lawmakers on the HFSC, relevant backgrounds, and the districts they represent:

Congressman Marlin Stutzman (R-IN-3)

• While Rep. Stutzman is technically a freshman member of the current Congress, he returns to a seat he held from 2010-2017.
• In 2016, Rep. Stutzman did not run for re-election to the House, instead choosing to mount a bid for the U.S. Senate. His campaign for the Senate ended in defeat, as Stutzman did not advance past the Republican primary. 
• Indiana’s third district encompasses Fort Wayne and a large northeastern portion of the state.

Congressman Troy Downing (R-MT-2)

• Rep. Downing served as the state auditor for Montana from 2021-2025.
• Downing served in the U.S. Air Force and Air National Guard from 2001-2010, with a Combat Search and Rescue squadron that included two tours of duty to Afghanistan.
• Montana’s second district encompasses the entire eastern half of the state, including the cities of Billings and Helena.

Congressman Mike Haridopolos (R-FL-8) 

• Rep. Haridopolos served as a member of the Florida House of Representatives from 2003-2010 and as President of the Florida Senate from 2010-2012.
• Florida’s eighth district encompasses all of Cape Canaveral and Brevard County.

Congressman Tim Moore (R-NC-14)

• Rep. Moore served as Speaker of the North Carolina House of Representatives from 2015-2025, and served in the state legislature since 2003.
• The fourteenth district encompasses Charlotte and large segments of western North Carolina.

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CREFC's December 2024 Monthly CMBS Loan Performance Report

• Conduit/SASB CMBS combined delinquency of 6.57% 
  • Delinquency rate increased 17 bps in December and 10 of 12 months in 2024
  • On a YOY basis, the overall combined delinquency rate is up 206 bps (6.57% vs. 4.51% in December 2023)
• Office delinquency rate surged 63 bps in December to 11.01%, following a 101 bp increase in November
  • Before this, the highest office delinquency rate recorded was 10.70% in December 2012 
  • Office delinquency rate is up 519 bps YOY
    • Convergence of WFH demand shock, elevated rates (despite year-to-date Fed rate cuts), and a pullback in bank lending will continue to present office financing headwinds
• December delinquency rate is still 375 bps below the 10.32% peak in June 2020 – the height of pandemic-related lockdowns
• Loans in special servicing (SS) rose 36 bps to 9.89% in December and up 311 bps YOY
  • SS rate is at highest level since November 2020 – the last time the overall SS rate had breached 10%
• In a report dated 1/10/25, BofA Global Research examined YTD pay-off trends for conduit loans
  • In one analysis, pay-off rates were calculated by property type and loan size; as shown below, successful pay-off rates decreased as loan size increased, with office loans facing the most significant challenges 
  • Among IO loans, only 56% of loans paid off, below the 63% across the overall sample; among amortizing loans, a much higher 82% paid off on time

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CREFC’s 4Q 2024 Sentiment Index Highlights Broad Optimism as Market Dynamics Stabilize 

January 28, 2025

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First 100 Days: Regulatory Update

January 28, 2025

The financial markets expect a considerable deregulatory push under the Trump administration. However, policymakers, including Republican members of Congress, continue to note that deregulation can be as painful as putting new regulations in place. As a former Justice Department official observed in the American Banker:

"An executive order has the force of law within the executive branch, but if one of the next steps is to rescind regulations or to adopt new regulations, that process has to go through the formal notice-and-comment rulemaking process. Deregulation is by definition regulation, and that's going to take time."

President Donald Trump directed a freeze on federal rulemaking pending review, giving his administration the opportunity to reconsider any rules close to being proposed or completed. Freezing regulations for review is a standard transition practice.

• Any rules sent to the Federal Register that have not yet been published are to be withdrawn for review.
• Any rule recently published that has not yet taken effect will have its effective date delayed 60 days.

Personnel Is Policy

As reported in December 2024 by CREFC, President Donald Trump nominated Paul Atkins, former Commissioner at the Securities and Exchange Commission (SEC), to head the SEC. Please see here for details on Atkins’ agenda.

On Jan. 21, Trump nominated Bill Pulte to lead the Federal Housing Finance Agency (FHFA).

• Pulte is CEO of Pulte Capital Partners LLC, a strategic investment firm that invests in building products businesses. He is the grandson of William Pulte, founder of the Pulte residential home construction company.
• Pulte’s nomination came as a surprise given his lack of experience in the housing finance market. However, his comments on the lack of housing supply in the U.S. reflect Trump’s focus on the housing sector.
• During a 2024 interview on Fox Business, Pulte blamed regulation and the lack of housing supply for driving up home prices, stating that “until we increase supply, whether it comes from old homes. . . or new homes, you’re going to have these prices go up.”

Other than Pulte’s nomination, Trump’s focus on financial services generally has taken a back seat to other priorities, such as immigration and DEI. Yet, he has named acting heads for a few key agencies. These officials will run their respective agencies on an interim basis until full-time chairs are nominated and confirmed.

• SEC: Mark Uyeda, currently an SEC Commissioner, will serve as acting head. During his time as a commissioner, Uyeda has argued the SEC is operating outside of its mandate. He will serve on the SEC alongside fellow Republican Commissioner Hester Peirce and Democratic Commissioner Caroline Crenshaw.
• Commodity Futures Trading Commission (CFTC): CFTC Commissioner Caroline Pham has been named acting CFTC Chair. One of the agency’s five politically-appointed commissioners since 2022, Pham has advocated for clearer crypto rules and focused on American competitiveness and right-sizing regulations to promote market liquidity.
• Federal Deposit Insurance Corporation (FDIC): FDIC Vice Chair Travis Hill assumed the role of Acting Chair Monday, outlining a comprehensive agenda of priorities. In addition, Hill committed to ensuring that the FDIC “remains within our statutory mandates, and stops coloring outside the lines.”
• Given that Hill is considered a top candidate for FDIC Chair, his priorities provide insight into the path bank regulators might take over the next few years.

Trump surprised many market observers by not firing Rohit Chopra, director of the Consumer Financial Protection Bureau (CFPB) or replacing Michael Hsu, Acting Director of the Office of the Comptroller of the Currency (OCC), on day one of his presidency. Additionally, Caroline Crenshaw, a Democrat on the SEC whose term recently expired, has retained her seat for now.

What people are saying: Identifying and installing leaders across the financial regulatory agencies can be like a game of chess.

• Trump might have been waiting for Treasury Secretary nominee Scott Bessent to be confirmed and in place at Treasury before making final decisions about other financial regulators. With Bessent’s confirmation last night, we might see more nominations soon.
• American Banker notes that the Trump administration “has been stalled in filling posts for the CFPB and the OCC, in part, by longstanding tradition that has entitled the minority party to fill two of the five seats on the FDIC's board.”
• The FDIC board is composed of a chairman, a vice chair, the heads of the CFPB and the OCC, and one board member of the opposing political party.
• As Isaac Boltansky, managing director and director of policy research at BTIG, stated, "As soon as Trump replaces the heads of the OCC and CFPB, there will be too many Republicans on the five-member board and one of them will need to depart.”

Key policy news? In terms of financial policy, GSE reform and the Basel 3 Capital Endgame remain the highest profile issues.

Financial market participants continue to speculate on whether the Trump administration will prioritize removing the GSEs from conservatorship. Senior policymakers have indicated that privatizing the GSEs is not likely to be an immediate priority for the administration.

• In remarks before the National Association of Realtors, HFSC’s French Hill said: 

“We absolutely have to have executive branch leadership, and that's not a cop-out. I mean, it's just something that can't just be orchestrated by Congress.”

• Politico notes that Hill’s call for executive branch involvement “comes days after Trump’s nominee for Treasury secretary, Scott Bessent, gave noncommittal answers about overhauling Fannie and Freddie in response to questions from the Senate Finance Committee.”

The Basel 3 Endgame also continues to come up in discussions, with senior GOP lawmakers recommending withdrawal of the current proposal and potential capital-neutral re-proposal.

• Acting FDIC Chair Hill also noted the need to adjust:

“our capital and liquidity rules to appropriately balance driving economic growth with ensuring safety and soundness and resilience to shocks.”

CREFC will keep membership closely informed of policy developments that impact the CRE markets, including the nominations and confirmations of leaders in the financial regulatory space.

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Capital Markets Update Week of 1/28

January 28, 2025

Private-Label CMBS and CRE CLOs

Six transactions totaling just over $5 billion priced last week:

• MF1 2025-FL17, a $1.2 billion CRE CLO from MF1, comprised of 25 loans secured by 86 multifamily properties
• LNCR 2025-CRE8, a $1.0 billion CRE CLO from LoanCore, comprised of 24 loans secured by 35 properties. The pool consists of multifamily (46.2%), industrial (29.6%), and hotel (13.1%) property types
• BBCMS 2025-C32, a $1.0 billion conduit backed by 49 10-year loans secured by 75 properties from Barclays and 12 other contributors
• AREIT 2025-CRE10, a $911 million CRE CLO from Argentic, comprised of 23 loans secured by 90 properties. The pool’s top property type concentrations are multifamily (45.5%), industrial (32.4%), and hotel (10.3%)
• BX 2025-BIO3, a $535 million SASB backed by a fixed-rate, five-year loan to Blackstone’s BioMed Realty unit to refinance eight life-science buildings
• JPMCC 2025-BMS, A $270 million SASB backed by a floating-rate, five-year loan (at full extension) for Stockbridge Capital to refinance two single-tenant office properties in San Mateo, CA.

By the numbers: Year-to-date, private-label CMBS and CRE CLO issuance is off to a strong start, totaling $9.1 billion. This is more than double the $4.5 billion for same-period 2024.

Spreads Largely Unchanged

• Conduit AAA and A-S spreads were unchanged at +71 bps and +105 bps, respectively, while AA and A spreads were tighter by 5 bps to +130 and +160, respectively.
• Conduit BBB- spreads were tighter by 10 bps at +415.
• SASB AAA spreads were unchanged in a range of +90 bps to +110 bps, depending on property type.
• CRE CLO AAA and BBB- spreads were unchanged at +130 / +135 bps (Static / Managed) and +370 / +395 bps (Static / Managed), respectively.

Agency CMBS

• Agency issuance totaled $2.8 billion last week, consisting of $1.4 billion in Fannie DUS, $1.1 billion in Freddie K, SBL, and Multi-PC transactions, and $269.9 million in Ginnie Mae Project Loan transactions.
• Agency issuance for the year totaled $8.9 billion, 27% higher than the $7 billion for same-period 2023.

The Economy, the Fed, and Rates…

Economic Data

• The labor market shows signs of moderation, while remaining fundamentally sound. Initial jobless claims increased by 6,000 to 223,000, while continuing claims reached 1.9 million, the highest since November 2021.
• The California wildfires have impacted employment metrics, with Bloomberg Economics estimating a reduction in January's nonfarm payrolls by approximately 16,000 jobs. Job-finding periods have lengthened for the unemployed despite overall low unemployment rates.
• The housing market closed 2024 with mixed signals. Existing home sales rose 2.2% in December to an annualized rate of 4.24 million units, marking three consecutive monthly increases. However, 2024 recorded the lowest annual sales since 1995. Mortgage rates, projected to remain above 6% through at least 2027, according to some estimates, continue to constrain affordability.
• The University of Michigan’s sentiment index fell to 71.1 in January, marking the first decline in six months. Inflation expectations rose to 3.3% for the next year, highlighting consumer concerns about potential tariffs and price pressures.

Growth Outlook

• The economy enters 2025 with considerable momentum, with fourth-quarter GDP growth potentially reaching 3%, according to the Atlanta Fed's GDPNow forecast. This performance continues a pattern of stronger-than-expected growth, with 2024 GDP estimated between 2.4% and 2.7%.
• The International Monetary Fund recently upgraded its 2025 U.S. growth forecast to 2.7%, while downgrading other major economies. Business sentiment is generally optimistic about the new administration, though uncertainty remains as to the impact of proposed policy changes.

Federal Reserve Policy and Interest Rates

• The Federal Reserve is expected to maintain its benchmark rate between 4.25-4.50% at this week's meeting, following three consecutive cuts in late 2024. The policy outlook has become more complex, with markets now pricing in two quarter-point reductions by year-end, down from four previously anticipated.
• Fed officials appear increasingly concerned about inflation risks from potential policy changes, including tariffs and immigration restrictions. BlackRock CEO Larry Fink suggested economic strength might eventually necessitate rate increases, though this isn't his baseline scenario.
• Dan Ivascyn, Chief Investment Officer of PIMCO, said he expected the Fed to keep rates steady until there was “more clarity either on the data front or the policy front.” He further noted:

Market Reaction and Treasury Yields

• The S&P 500 gained almost 2% last week, its strongest start to a presidential term since 1985. Optimism was driven by Trump’s softer trade stance and pro-business policies, although volatility will likely persist due to tariff uncertainties.
• Treasury yields declined slightly, with the 10-year yield ending at 4.62%. Short-term yields were particularly sensitive to rate speculation, dropping four basis points during the week. Further steepening of the yield curve is anticipated later in 2025.

You can download CREFC’s one-page MarketMetrics with statistics covering the economy and the CRE debt capital markets here.

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