What the 10-year is doing to cap rates this spring.
The 10-year Treasury has held in a 4.25–4.60% band for six weeks. Here's what that's meant for CRE underwriting, agency debt pricing, and cap rate spreads in April 2026.
The 10-year Treasury yield has sat in a 4.25–4.60% band for the last six weeks, bracketing 4.40% most days. That range matters for commercial real estate because the 10-year is the reference rate under almost every piece of long-term CRE debt — and the rate against which investors set their cap rate spread.
At 4.40%, with a 175–225 bp CRE risk premium, the arithmetic gets you to the cap rates institutional multifamily and credit-tenant net lease are actually trading at in primary markets right now. That's not a coincidence.
What's priced today
Current indications from brokers we talk to:
- Institutional multifamily, primary markets. Class A trades 5.25–5.75% cap. Secondary-market Class A runs 5.75–6.25%.
- Single-tenant absolute NNN, investment-grade tenant, long term. 5.50–6.25% cap.
- Industrial distribution, primary markets. 5.50–6.25% cap; infill last-mile tighter.
- Self-storage stabilized primary. 5.75–6.50% cap.
These are roughly 75–125 bps wider than the peaks of 2021–22, reflecting the repricing that followed the Fed's 2022 tightening cycle. They are narrower than many bears expected a year ago.
Agency debt pricing
Fannie DUS and Freddie Optigo quotes this month on stabilized Class A multifamily are clearing in the high-5s to low-6s all-in for 7-10 year fixed. Spread to Treasuries has tightened slightly as agency paper has been well-bid in the bond market.
CMBS origination is back to pre-2022 monthly volumes on a seasonally-adjusted basis. Spreads have normalized. Coupon all-in on stabilized CRE runs mid-6s to low-7s depending on DSCR, debt yield, and asset type.
The bridge-to-agency math
Every multifamily bridge loan originated in 2021 was underwritten assuming a refinance at somewhere in the 3.5–4.5% coupon range. Those loans are now refinancing — or not — at coupons 150–200 bps higher than that underwriting assumed.
The deals that survive either (a) actually hit their rent-growth and NOI targets and can cover debt service at the higher coupon, or (b) have sponsors willing to write a meaningful equity check into the refi. The deals that don't survive go to workout or forced sale. More on that in our bridge-refi wave piece.
What to watch next
Three things we're tracking into May:
- Next Fed meeting signal on cut cadence. Any acceleration or pause changes the forward curve and immediately feeds through to long CRE spreads.
- Primary-market industrial absorption. If infill tightens further while outer-suburban softens, the submarket split we wrote about in Q1 widens.
- DST sponsor offerings. Watch whether net-lease DSTs continue to pull share from multifamily DSTs as yields in the net-lease market stabilize.
For the 1031 buyer on a 45-day clock: the current rate environment favors sellers of stabilized credit-tenant NNN and institutional multifamily with priced-in agency refis. It punishes anyone trying to exchange into transitional or value-add at aggressive going-in caps. Play the tape that's actually in front of you.