Published by Northern Ridge Capital
Index Rates (as of April 24, 2026)
| Rate | Value | Source |
|---|---|---|
| SOFR (30-Day Avg) | 4.14% | NY Federal Reserve |
| 5-Year Treasury | 3.72% | Federal Reserve H.15 |
| 10-Year Treasury | 4.31% | Federal Reserve H.15 |
| Fed Funds Rate | 3.50% – 3.75% | Federal Reserve |
| Prime Rate | 6.75% | Federal Reserve H.15 |
Consumer Sentiment Near Historic Lows
The University of Michigan’s final Consumer Sentiment Index for April came in at 49.8, down from 53.3 in March and now comparable to the June 2022 trough. Declines were broad-based across all income levels, age groups, and political affiliations. Year-ahead inflation expectations surged to 4.7%, the largest one-month jump since April 2025, while long-run expectations climbed to 3.5%, the highest since October 2025.
The partial recovery tied to a brief ceasefire announcement underscores how event-driven this index has become. If energy prices and geopolitical headlines deteriorate again, sentiment could reverse quickly. For CRE owners, the most direct exposure is in hospitality, discretionary retail, and experiential assets. Necessity-based retail and multifamily remain better insulated.
The Fed Holds Again
The FOMC meets Tuesday and is widely expected to hold the federal funds rate unchanged at 3.50% to 3.75%. Markets are currently pricing only a 26% probability of a rate cut by December, down sharply from earlier in the year when two cuts were broadly anticipated. With inflation expectations elevated and the Strait of Hormuz still effectively closed, the Fed has limited room to ease. Borrowers should not build their financing strategy around rate relief in the near term.
Retail Sales: Strong Headline, Weaker Reality
The Census Bureau reported total retail and food services sales rose 1.7% in March and 4.0% year over year, but the headline is heavily distorted. Gasoline station receipts surged 15.5%, driven by the conflict in the Middle East. Excluding gas, sales rose just 0.6%. Core retail sales also gained 0.6%, broadly in line with a moderate consumer spending pace supported in part by tax refund timing.
Higher fuel costs are beginning to crowd out discretionary budgets, particularly for lower-income households. With consumer confidence at multi-year lows and tax refund support unlikely to repeat, demand across hospitality and discretionary retail warrants caution heading into Q2.
Multifamily Gets a Quiet Tailwind
Pending home sales fell 1.1% year over year in March, and the average 30-year mortgage rate remains above 6%. The National Association of Home Builders Housing Market Index held at 38 in March, its 23rd consecutive month in contractionary territory, with 64% of builders still offering incentives. Affordability constraints continue to keep would-be buyers in the rental market, supporting occupancy across multifamily nationally. The Sun Belt remains the regional outperformer, with the South posting the only year-over-year gain in pending sales at 2.3%.
CRE Loan Spreads Are Tightening
One of the more constructive data points for borrowers: CRED iQ’s latest loan analytics show 10-year spreads on stabilized CRE loans compressed 12 to 18 basis points over the trailing 12 months, with most of the compression occurring in Q1 2026. As of March 31, spreads on 60 to 65% LTV permanent loans stood at 154 bps for multifamily, 162 bps for industrial, 176 bps for retail, and 220 bps for office. With the 10-year Treasury at approximately 4.31%, implied all-in coupons are roughly 5.79% for multifamily, 5.87% for industrial, 6.01% for retail, and 6.45% for office.
Senior Housing: Occupancy Keeps Climbing
Senior housing occupancy rose 0.4 percentage points to 89.5% in Q1 2026, marking the 19th consecutive quarter of improvement according to NIC MAP. Units under construction fell to their lowest level since 2012, and year-over-year inventory growth hit a record low of 0.4%. The development slowdown is driven by capital constraints and elevated labor and materials costs rather than weak demand, pushing institutional investors toward acquisitions of existing properties rather than new development.
The Bottom Line for Borrowers
Capital is available and lenders are competing for the right deals. Spreads are compressing. But the macro environment remains unsettled, the Fed is on hold, and borrowing costs are unlikely to fall meaningfully in the near term. For owners with loans approaching maturity or deals in the pipeline, waiting for a more favorable rate environment carries real risk.
Have a deal or a loan maturing? Contact Northern Ridge Capital to discuss your financing options.