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63 March 2025 J O U R N A L March 2025 » Conventional MCAI increased by 3.8%. The Conforming MCAI increased by 0.5%, while the Jumbo MCAI increased by 5.3% among the Conventional MCAI's component indices. "Credit availability increased to start 2025, driven by conventional cred- it supply rising to its highest level since June 2022," said Joel Kan, MBA's VP and Deputy Chief Economist. "There were expanded loan offerings for cash- out refinances, along with more jumbo and non-QM loan programs. Although similar to last month, these were limited to borrowers with better credit. All other subindexes saw increases in January, a positive development for the spring homebuying season if these trends continue." Key Highlights—Conventional, Government, Conforming & Jumbo Indices In January, the MCAI increased by 2.5% to 99. While the Government MCAI climbed by 1%, the Conven- tional MCAI increased by 3.8%. The Conforming MCAI increased by 0.5%, while the Jumbo MCAI increased by 5.3% among the Conventional MCAI's component indices. Using the same technique as the Total MCAI, the Conventional, Govern- ment, Conforming, and Jumbo MCAIs are created to demonstrate the relative credit risk and availability for their respective indices. The population of loan programs that are examined is the main distinction between the Compo- nent Indices and the entire MCAI. While the Conventional MCAI looks at nongovernment loan pro- grams, the Government MCAI looks at FHA, VA, and USDA loan programs. FHA, VA, and USDA loan offerings are not included in the Jumbo and Conforming MCAIs, which are a subset of the standard MCAI. Conventional lending programs that come inside conforming loan limits are examined by the Conforming MCAI, whereas conventional programs outside of conforming loan limits are examined by the Jumbo MCAI. WHAT PERCENTAGE OF COMMERCIAL MORTGAGE BALANCES WILL MATURE IN 2025? A ccording to the Mortgage Bank- ers Association (MBA), approxi- mately 20% ($957 billion) of $4.8 trillion of outstanding commercial mortgages held by lenders and investors will mature in 2025, a 3% increase from the $929 billion that matured in 2024. The MBA reports these findings in its 2024 Commercial Real Estate Survey of Loan Maturity Volumes. "While the Federal Reserve cut its short-term interest rate target by 100 basis points in 2024, longer-term inter- est rates increased over the same time by an equivalent amount. Commercial property owners who had sought to take advantage of a drop in rates stem- ming from Fed cuts were disappointed," said Mike Fratantoni, MBA's SVP and Chief Economist. "As a result, many loans that might have matured in 2024 have been extended into 2025, with the aggregate results showing a 3% increase in total commercial mortgages matur- ing in 2025 compared to what MBA had estimated would mature last year." The loan maturities vary significant- ly by investor and property type groups. Among loans backed by industrial properties, 22% will come due in 2025, as will 24% of office property loans and 35% of hotel/motel loans. Fourteen percent of mortgages backed by multifamily properties (not including those serviced by depositories) will mature in 2025, as will 18% of those backed by retail and healthcare properties. "Longer-term rates are likely to remain rangebound for the foreseeable future, and the path to work through these maturities will remain challeng- ing," Fratantoni added. "However, as is always the case in CREF markets, opportunities vary widely across capital sources, property types, and geographic markets." According to the MBA's findings, $452 billion (25%) of the outstanding balance of mortgages serviced by deposi- tories, $231 billion (29%) in CMBS, CLOs, or other ABS, and $180 billion (35%) of the mortgages held by credit companies, in warehouse or by other lenders will mature in 2025. Just $31 billion (3%) of the outstanding balance of multifamily and healthcare mortgages held or guaran- teed by Fannie Mae, Freddie Mac, FHA, and Ginnie Mae will mature in 2025. Life insurance companies will see $64 billion (9%) of their outstanding mortgage bal- ances mature in 2025. The MBA reports that the dollar figures reported are the unpaid principal balances as of December 31, 2024. Because most loans pay down principal, the bal- ances at the time of maturity will general- ly be lower than those reported here. "Commercial property owners who had sought to take advantage of a drop in rates stemming from Fed cuts were disappointed." —Mike Fratantoni, MBA, SVP and Chief Economist