Kaufman Provides 2026 Commercial Real Estate Market Insights
Pryor Cashman Partner Bradley A. Kaufman, a member of Pryor Cashman's Real Estate Group and Co-Chair of the Leasing Practice, provided market insight for Practical Law The Journal’s article "Commercial Real Estate: 2026 Trends and Predictions.”
In the article, Brad discusses the evolving dynamics of the U.S. commercial real estate market, addressing trends affecting capital markets, leasing negotiations, development timelines, and risk allocation in real estate transactions as market participants continue to navigate high interest rates and ongoing capital constraints.
Brad notes that while the widely discussed commercial real estate “maturity wall” has begun to ease, the industry is still expected to see a steady flow of loans entering workout mode over the next 12 to 18 months.
“Even as the maturity wall of 2024 eases, a steady flow of loans is likely to enter workout mode over the next 12 to 18 months. That means lots of amend-and-extend conversations, mezzanine loan UCC foreclosures when value is tight, and, in some cases, borrowers handing keys back to lenders to escape carry guaranty liability.”
Brad also highlights a key issue emerging in lease negotiations related to tenant build-outs.
“[T]he most expensive silent issue in lease negotiations is the build-out free rent period. The worst position for a tenant to be in at lease commencement is to be months behind in their build-out and ability to use that space, while having run through or fully expended their construction allowance.”
Read the full article using the link below (subscription may be required).
