Owners who think clearly about refinancing, selling, or holding in 2026 will be those who have prepared for these decisions well in advance. As we move deeper into 2026, commercial real estate owners face a set of decisions that can shape their cash flow, portfolio risk, and long-term wealth creation. After several years of high interest rates, refinancing pressure, and uneven market recovery across property types, the question of whether to refinance, sell, or hold is no longer academic. It is a decision rooted in fundamentals, capital markets realities, and your own investment goals.
Understanding how to weigh each pathway is essential in a year where capital costs remain elevated; maturities are significant, and buyer sentiment varies widely by sector.
The Current Financing Landscape
A defining theme for 2026 is the ongoing refinancing wave. A large majority of commercial real estate loans originated during the low-interest rate years are either maturing or approaching maturity. Between now and 2030, more than $2 trillion in CRE loans are expected to come due, a scale of refinancing activity that requires thoughtful navigation.
At the same time, lenders are taking a harder line on capital quality. After years of modifications and “extend-and-pretend” strategies, many financial institutions are pushing owners to either pay down debt, refinance at current rates, or face workout solutions.
While monetary policy remains in flux, with markets pricing in potential rate cuts later this year, borrowing costs today are still materially higher than they were in the 2018 to 2021 period. That reality changes how owners should approach refinancing and sale timing.
When Refinancing Makes Sense
Refinancing can be a powerful tool, but only under the right conditions.
Cash Flow Preservation
If you own a property with stable occupancy, strong tenant covenants, and a healthy net operating income (NOI), refinancing can preserve cash flow and avoid default or forced sale. This is especially true if you can extend debt maturities or modestly reduce rates relative to an expiring higher-cost loan.
Stretch Maturities
For owners facing a maturity in the next 12 to 24 months, refinancing can be a way to smooth out capital requirements and avoid fire-sale pricing pressure. In some markets, lenders may offer customized structures like stretch senior notes or mezzanine tranches that keep properties financed without large equity injections as per CRE experts.
Strategic Upgrades
In properties where rental growth or cap-ex improvements can materially increase value, refinancing fund upgrades might make sense. This is more common in selective sectors such as industrial or stabilized retail.
When It Might Not Be Right
A higher rate environment means that refinance payments could be significantly larger than existing debt services. In some scenarios, particularly for assets with limited upside, refinancing may squeeze cash flow and depress returns. In that case, holding the property without meaningful restructuring could be more prudent.
When Selling Becomes the Best Option
Selling is not a last resort. In many cases, it can be the most rational decision.
Valuation Visibility and Price Discovery
Transaction activity today is uneven. Well-located, high-quality assets are still trading at respectable cap rates, and in some markets, investors with dry powder are looking to deploy capital where fundamentals are strong. These conditions offer owners a chance to capture value before the next major repricing cycle, particularly in sectors with lingering headwinds, like office or underperforming retail.
Avoiding Refinancing Risk
If your debt maturity is imminent, and refinancing terms are unattractive or unavailable, a sale can avert distress outcomes. Successful dispositions allow owners to redirect capital into higher-growth opportunities or pay debt obligations.
Tax and 1031 Strategies
Selling at the right time also opens the door to strategic tax planning. Using tools such as a 1031 exchange or Delaware Statutory Trust structures can defer capital gains, preserve wealth, and reposition into properties better suited for current market dynamics.
When Holding Is the Right Choice
Holding makes sense when the fundamentals of your asset remain strong, even if short-term yields are soft.
Long-Term Income and Growth
For assets with reliable cash flow and strong tenant profiles, holding through market fluctuations can generate income and provide optionality as conditions improve. Industrial, last-mile logistics, and well-leased residential assets often fall into this category.
Redevelopment or Repositioning Potential
Some properties have intrinsic value that market pricing has yet to be fully recognized. A thoughtful repositioning plan, whether through redevelopment or operational improvements, can enhance returns over the long term.
Opportunity Cost Calculation
Holding can also make sense when the cost of selling, including brokerage fees, capital gains, and transaction costs, outweighs incremental return expectations from a sale.
Bringing It All Together
Every property owner’s situation is unique, but the broader market context in 2026 offers some clear structural themes:
- Refinancing is available but selective. Capital is present in the market, yet lenders are disciplined, favoring strong fundamentals.
- Sale opportunities exist, particularly for top-tier or high-demand assets. Owners willing to transact now may capture pricing before broader market repricing emerges.
- Hold strategies remain valid when long-term yield prospects and repositioning value justify patience.
At its core, the decision framework should be grounded in disciplined underwriting, realistic projections of future cash flow, and a clear understanding of your own investment goals. There is no one-size-fits-all answer, but there is always a well-reasoned strategy.
Related read: Commercial Real Estate in 2026: What Smart Investors Are Preparing for Now from the ICRE Investment Team explores how investors are positioning themselves in today’s market and what trends they are watching closely.
Aligning Strategy with Goals
Owners who think clearly about refinancing, selling, or holding in 2026 will be those who have prepared for these decisions well in advance. The market is sorting itself, strong assets and disciplined owners are finding capital and opportunity, while others are rethinking their strategies.
If you are evaluating these choices for your portfolio this year, the right guidance matters. The ICRE Investment Team is actively advising owners on strategic options that balance risk, return, and timing. Whether you are considering refinancing options, prepping a sale, or planning a long-term hold strategy, we can help you weigh the data, structure your transaction, and align your next step with your financial objectives.
