As commercial real estate moves into 2026, many investors remain cautious. Interest rates are elevated, refinancing is harder, and a significant volume of debt is approaching maturity. Yet according to Peachtree Group CEO Greg Friedman, today’s challenges are often misunderstood.
“This is not a property issue or an asset-level issue in most cases,” Friedman said. “This environment, for the most part, is balance sheet driven.”
Where Pressure is Coming From
Across most property types, operating fundamentals remain relatively stable. The real pressure is coming from capital structures that were built in a much lower interest rate environment. As loans mature, many borrowers are discovering that refinancing now requires additional equity or a rethinking of their capital stack.
That challenge is being magnified by what Friedman describes as an unprecedented wave of loan maturities. “Over the next 12 months, close to a trillion dollars of commercial real estate loans are maturing,” he noted.
Opportunity for Investors
For investors, this dynamic is creating opportunity, particularly in credit. As banks pull back due to regulatory and balance sheet constraints, private lenders are stepping in at more attractive bases. “We’re buying loans or making loans at discounts to current value,” Friedman explained. “In many cases, we’re getting equity-like returns without having last dollar equity risk.”
At the same time, equity investing requires greater selectivity than in prior cycles. From 2010 to 2022, falling interest rates provided a powerful tailwind for valuations. That environment no longer exists. Today, equity returns depend on disciplined buying, asset management, and operational execution.
What’s Next
Looking ahead, Friedman expects 2026 to remain uneven but constructive. While refinancing pressure may persist in the near term, limited new supply and continued demand growth could support improved pricing power later in the year.
Key Takeaways
Listen to the full episode of Peachtree Point of View for Greg Friedman’s perspective on navigating commercial real estate in 2026.
