CMBS Weekly: REIS 1Q CRE fundamentals review

Research evidence excerpt

CMBS Weekly: REIS 1Q CRE fundamentals review

Accessible version

CMBS Weekly

REIS 1Q CRE fundamentals review

Key takeaways 15 May 2026

Securitized Products Strategy• Remain overweight CMBS; strong bond fund inflows and higher yields support more

United States

private label and Agency spread tightening.

• Private label issuance slowed this week with only 3 deals totaling $4.4bn pricing. Alan Todd, CFA

CMBS Strategist

BWIC activity increased. BofAS

+1 646 855 6383

• This week, we provide our quarterly update on CRE fundamentals for 1Q26: alan.todd@bofa.com

fundamentals continued to improve, but unevenly. Nick O'Brien

BofAS

April CPI comes in hot, markets react sharply +1nicholas.obrien@bofa.com646 855 6366

With the April CPI print running at 0.6% month-over-month and 3.8% on an annualized

basis, Treasury markets had a sharp reaction to the news, with 30-year bond auctions at

over 5%, the highest since 2007. CMBS has seen an equivalent “inflation” increase over

the past few years, with revenues not matching operational costs across nearly all

property types. Exhibit 1: Benchmark spreads were

unchanged this week in secondary

Quieter week of issuance and spreads Benchmark spreads were stable in secondary

trading this week

Although only three deals priced this week in the private label market, 2026 issuance

totals are generally ahead of 2021 totals, which was the highest year of issuance in On-the-run Conduit bond spreads to

private label CMBS in recent history. Investor demand seems to match the record supply, Treasury

with spreads unchanged on the week. We retain our overweight recommendation and A1 (3yr) 5/1470 WTD0 MTD-5 YTD-10 Min70 Max80

expect LCF AAA spreads will narrow to the mid T+60bp area and benchmark BBB- A2 (5yr) 110 0 -10 -17 110 127