Where the Losses Are — Q2 2026
Five Books
Commercial Real Estate by Kind of Property: Balance, Holders and 60+ Day Delinquency Rate
| Kind of property | Balance | CUs | Q2 2022 | Q2 2024 | Q2 2025 | Q2 2026 |
|---|---|---|---|---|---|---|
| Construction and development | $11.0B | 688 | 0.17% | 1.15% | 1.67% | 1.89% |
| Farmland | $2.7B | 373 | 0.84% | 0.99% | 1.11% | 1.39% |
| Multifamily | $47.8B | 1,083 | 0.08% | 0.26% | 0.58% | 0.73% |
| Owner occupied | $38.3B | 1,238 | 0.37% | 0.76% | 0.89% | 1.08% |
| Non-owner occupied | $87.2B | 1,291 | 0.21% | 1.15% | 1.12% | 1.34% |
| All commercial real estate | $187.1B | 1,556 | 0.22% | 0.85% | 0.97% | 1.16% |
The Delinquency Moved treated commercial real estate as one book, 11% of loans, with the fastest-rising delinquency in the system; the Call Report divides it into five. Non-owner-occupied property, the buildings a borrower lets to others, is the largest at $87 billion. Multifamily is $48 billion and has grown fastest, to 3.6 times its size in 2019. Owner-occupied property, a business's own premises, is $38 billion. Construction and farmland are small.
Four years ago no kind but farmland had a delinquency rate above 0.37%. Now none is below 0.73%, and construction loans have the highest rate, at 1.89%.
Source: NCUA Call Report, Q2 2026 · release v2026.2.27 · QuarterCall
Delinquency Rose First on Non-Owner-Occupied Property, Then on Every Kind
Source: NCUA Call Report, Q2 2026 · release v2026.2.27 · QuarterCall
The rise came in two parts. From mid-2022 to mid-2024 delinquent commercial real estate went from $0.26B to $1.29B, and non-owner-occupied property was 69% of the increase. Most of that arrived within a year: the rate on those loans was 0.31% in mid-2023 and 1.15% a year later.
Since mid-2024 the delinquent balance has grown by another $885M, and the increase is no longer concentrated in one kind of property. Non-owner-occupied property is 38% of this second rise, multifamily 28%, owner-occupied 21% and construction 11%.
Multifamily's delinquent balance was $22M four years ago, $98M two years ago and is $347M now, and the institutions reporting any have gone from 51 to 139. Its rate is still the lowest of the five, on the book that grew most.
Losses by Kind
Net Charge-Offs on Commercial Real Estate, by Kind of Property
| Kind of property | 2024 | 2025 | First half 2025 | First half 2026 |
|---|---|---|---|---|
| Construction and development | $33M | $28M | $6M | $4M |
| Farmland | $1M | $1M | $0M | $1M |
| Multifamily | $2M | $26M | $15M | $21M |
| Owner occupied | $13M | $18M | $14M | $11M |
| Non-owner occupied | $152M | $237M | $66M | $131M |
| All commercial real estate | $202M | $310M | $102M | $169M |
Credit unions charged off a net $310M of commercial real estate loans in 2025, and $237M of it was on non-owner-occupied property. In the first half of 2026 the figures are $169M and $131M, the second of them 2.0 times the first half of 2025. Annualized, the loss rate on those loans is 0.30%, from 0.17% a year ago and 0.05% two years ago.
Measured against the system, the losses are small, and few institutions take them. All the commercial real estate charged off in the half is 2.5% of the system's net charge-offs, and a loss rate of 0.18% on the book compares with 5.17% on credit cards. Net losses on non-owner-occupied loans in the half came from 54 institutions, and one of them accounts for 22% of the total. On multifamily, where losses began in 2025, one institution took 58% of that year's.
Delinquency is more widespread than losses: 279 institutions report delinquent non-owner-occupied loans, and the one with the most holds 11% of them.
Half of Lenders Have No Delinquent Loans, and the Highest Rates More Than Doubled
Among the 825 credit unions with at least $10 million of commercial real estate now and two years ago, 416 have none of it delinquent. Two years ago 541 had none. The delinquent balance is higher than it was at 408 institutions and lower at 189.
The highest rates rose most. Two years ago, the tenth of these lenders with the highest rates had at least 1.80% of their commercial real estate delinquent; now that threshold is 3.95%. On non-owner-occupied property, 44 of the 701 institutions with $10 million or more of such loans have over 5% of them delinquent, and hold $6.7 billion. Four years ago 6 did.
Credit Unions With $1B–$10B in Assets Hold Two-Thirds of Commercial Real Estate Loans
Commercial Real Estate by Asset-Size Cohort, Q2 2026
| Cohort | Holders | Balance | Of loans | Of net worth | 60+ days | Non-owner occ. | Multifamily | Net charge-offs |
|---|---|---|---|---|---|---|---|---|
| Under $100M | 241 | $0.6B | 1.6% | 6% | 1.86% | 2.18% | 3.46% | -0.00% |
| $100M–$500M | 651 | $11.1B | 7.4% | 38% | 1.25% | 1.27% | 1.39% | 0.07% |
| $500M–$1B | 239 | $16.2B | 11.7% | 73% | 0.98% | 1.17% | 0.72% | 0.13% |
| $1B–$10B | 402 | $123.2B | 13.2% | 84% | 1.12% | 1.11% | 0.82% | 0.16% |
| Over $10B | 23 | $36.0B | 7.2% | 47% | 1.35% | 2.17% | 0.25% | 0.33% |
Credit unions in the $1B–$10B tier hold 66% of the system's commercial real estate. It is 13% of their loans and equal to 84% of their net worth, from 75% two years ago. Their delinquency rate on it went from 0.62% to 1.12% in those two years.
The largest credit unions moved the other way. Their rate was 1.87% two years ago, when the first rise was at its height, and is 1.35%; on non-owner-occupied loans it fell from 3.41% to 2.17%. They also have the highest loss rate, 0.33% annualized, and we read part of their fall in delinquency as charge-offs: a delinquent loan that is charged off leaves the delinquency count.
For 369 institutions the commercial real estate book is larger than their net worth, and they hold 58% of it, $109 billion. For 86 it is more than twice net worth. The concentrated holders' delinquency rate is 1.22%, against 1.09% for everyone else.
Most Commercial Real Estate Refinances, Reprices or Matures Within Five Years
Of the commercial real estate book, 72% contractually refinances, reprices or matures within five years, from 55% three years ago. The Terms Changed sets that beside the rest of the balance sheet. For these loans, the risk does not depend on default alone. A commercial mortgage that matures must be refinanced at the rate and appraised value of that day, and one that reprices takes the rate of that day; $135 billion does one or the other within five years.
Connecting the Lines
For the system, commercial real estate is a small problem: its losses are a fortieth of what credit unions charge off, and most of them are on non-owner-occupied property at a few dozen institutions.
The breakdown by kind of property shows how delinquency has developed. The first rise was on non-owner-occupied property and was steepest at the largest lenders, and that is the kind on which loans have since been charged off. The second rise is on every kind of property, and most of it is in the $1B–$10B tier, which holds two-thirds of the book; for those credit unions the book is equal to most of their net worth. The loans in that second rise have so far produced few losses: outside non-owner-occupied property, net charge-offs in the first half were $38M.
What to watch
- Multifamily delinquency — $347M and 139 institutions, on the book that grew fastest
- The non-owner-occupied loss rate — 0.30% annualized, and whether the count of institutions with a loss widens from 54
- The $1B–$10B tier — a delinquency rate of 1.12% on a book equal to 84% of net worth
- Construction loans — the highest rate, 1.89%, with $4M charged off in the half
- The Call Report has itemized delinquency and charge-offs by kind of property only since March 2022; balances by kind are read from 2019.
- Net charge-offs on commercial real estate come from few institutions, and one can be a fifth of a half-year's total, so a kind's loss rate is not a typical holder's.
- Charge-off rates for a first half are year-to-date figures annualized over the average balance, and are not like-for-like with a full year's.
- The Call Report names five kinds of property and no more; it does not say whether a building is an office or a warehouse, where it is, or what it is worth against the loan.
- Tier figures are aggregates of the institutions in a tier at each date, and institutions move between tiers.