After several years of caution, banks appear to be slowly stepping back into commercial real estate lending, and retail properties are helping lead the shift.
According to recent data from S&P Global Market Intelligence, 11 of the 18 U.S. banks with more than $1 billion in retail and shopping center loans increased their balances through 2025. A dozen institutions reported year-over-year growth, suggesting lenders are becoming more comfortable with the sector again.
Retail performance has been stronger than many expected coming out of the pandemic and interest rate cycle. Open-air shopping centers, particularly grocery-anchored properties, have continued to show stable occupancy and consistent foot traffic.
At the same time, much of the capital that was raised to invest in distressed CRE never fully deployed. Instead, private credit stepped in to fill much of the lending gap, refinancing properties that many expected would face challenges.
Now, with fewer credit surprises and stronger bank balance sheets than during previous cycles, lenders appear to be gradually returning.
This doesn’t mean lending conditions are suddenly wide open. But it does suggest that confidence in retail real estate fundamentals is improving, and that financing availability may continue to expand as the year progresses.
Be the first to know about new investment properties.
Subscribe to our mailing list
