Arizona CRE refinancing: five checks before a loan matures

Contributed perspective

Editor's note: Craig Hoebing arranges commercial mortgages through Capital Market Funds in Scottsdale. The Arizona transaction examples below are his account of his firm's work; CRE News Today has not independently reviewed the loan files. National maturity statistics come from MBA's February release.

The Mortgage Bankers Association reported in February that $875 billion, or 17 percent, of outstanding U.S. commercial mortgages was scheduled to mature in 2026. Its figures measure unpaid principal balances as of December 31, 2025. Amortization can reduce the balances actually due. This is an annual schedule, rather than an estimate of debt still awaiting refinancing in October. [1]

That number is national. The cited release does not provide an Arizona maturity total. But its breakdown is useful to Arizona owners because it shows why the identity of your lender matters alongside the property's market. Here is how I would work through a maturity coming up in 2026 or 2027.

1. Find out who holds your loan

MBA reports that 21 percent of depository-serviced balances mature in 2026, compared with 25 percent for CMBS, CLO and other asset-backed loans; 29 percent for credit companies, warehouse facilities and other lenders; and 10 percent for life insurers. The share is 4 percent for multifamily and health care loans held or guaranteed by Fannie Mae, Freddie Mac, FHA and Ginnie Mae. [1]

Those are percentages within each group, not shares of all maturities. An apartment owner with an agency loan and years left is in a different position from an industrial owner whose bank loan is due this year. If you are not sure who holds your note, ask your servicer.

2. Know how crowded your property type is

MBA's property-type breakdown puts 2026 maturities at 30 percent of hotel and motel balances, 23 percent of industrial, 17 percent of office and 13 percent of multifamily balances. [1]

That hints at how many owners in your asset class may be asking lenders for proceeds at the same time. It does not tell you what any lender will do with your building. Your own property's leases, operating results and business plan still need to support the financing request.

3. Read the note before you call anyone

Pull the maturity date, prepayment terms, extension options and the tests attached to them, and whether the loan is recourse. An extension available only if a test is met is not the same as an unconditional right to extend. If you may refinance before maturity, the prepayment cost belongs in your payoff number.

An amortization schedule can help you identify the balloon balance. Check a prepayment estimate against the actual loan documents and your servicer's payoff statement. A calculator illustrates the terms entered into it; it cannot establish what your lender will accept.

4. Size the new loan on today's numbers

A maturity is a payoff date. It does not establish that a new loan of the same size is available. Lenders may test debt service coverage, loan-to-value and debt yield. Where those tests apply, the most restrictive can limit proceeds. When the new loan is smaller than the payoff, the gap is cash the owner brings, a different capital structure, or a sale.

Use current net operating income, property value and proposed debt service to understand which test may limit proceeds. Treat a sizing calculator as an illustration. Actual terms depend on the lender and the property.

Two examples from my work show why matching the property to a capital source matters. My firm arranged life-company financing for value-add multifamily in Tucson and a credit-union loan for a six-bay automotive service center in Peoria. These were different properties and financing assignments. A loan structure that fits one building is not a template for the next.

5. Match the building to the right kind of lender

Different capital sources fit different stories. In my experience, core industrial and well-leased retail often start with life companies and banks. Stabilized apartments can fit agency or HUD debt. CMBS can be another option when a life company or bank is not a fit. Bridge debt is for a business plan, such as lease-up or renovation, and it should come with a clear takeout. No type is open to every file.

If you own and occupy the building, compare an SBA 7(a) or 504 structure with conventional bank financing. SBA's 7(a) program provides a lender guarantee and permits uses including working capital and business acquisitions. Its 504 program finances eligible major fixed assets through a certified development company and a senior lender. The CDC/SBA-backed portion carries a fixed rate; the senior lender's terms are separate. A 504 loan cannot fund working capital or investment in rental real estate. [2] [3]

Start before the date is close

An owner who has identified the holder, read the note and run the numbers has a faster, better conversation with a lender. Underwriting, appraisal and closing take time, and a maturity date does not move because the process is slow. In my experience, a typical commercial loan takes 70 to 90 days to close. That is a planning estimate from my work; an individual transaction can take a different amount of time.

Disclosure: Capital Market Funds arranges commercial mortgage financing for property owners and publishes loan calculators. It is not a bank or direct lender. The author reports no other business relationships relevant to the examples or recommendations in this article. This is an unpaid contributed perspective.

About the author

Craig Hoebing is Managing Member of Capital Market Funds, a commercial mortgage advisory firm based in Scottsdale. Headshot: Courtesy of Capital Market Funds, supplied with permission for publication with this article.

Sources

1. Mortgage Bankers Association, February 9, 2026: 17 percent of commercial and multifamily mortgage balances to mature in 2026.
2. U.S. Small Business Administration: 7(a) loans.
3. U.S. Small Business Administration: 504 loans.

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