Large REITs Slow Commercial Mortgage Loan Origination

Mortgage real-estate investment trusts (REITs), which typically originate about $10 billion in loans per quarter, have significantly pulled back due to the downturn in the CRE sector. Mortgage REITs are scaling back originations to protect their balance sheets amidst the most challenging CRE market in decades. Default rates within the sector are rising as elevated interest rates pose refinancing challenges for borrowers. The retreat of Mortgage REITs from lending highlights an increasingly tight credit landscape.

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