Non-Agency CMBS Issuance Explodes in February
Steve Baumgartner, Mar 2025 - 2 min read 
Image source: EY
Non-Agency CMBS Market Overview
February 2025 defied expectations by delivering post-GFC record-breaking issuance volumes in the U.S. non-agency CMBS market. With over $19 billion brought to market, February marked the highest monthly volume since August 2007.
Source: Commercial Mortgage Alert, Morningstar Credit
The year’s strong start continued a notable trend, with the first two months of 2025 generating more than $27 billion in issuance—triple the $9 billion seen during the same period in 2024.
Source: Commercial Mortgage Alert, Morningstar Credit
Single Asset Single Borrower (SASB) transactions continue to dominate the primary markets, accounting for the majority of issuance with 15 deals totaling $15 billion. Investors maintained their strong appetite for premium SASB offerings backed by strong sponsors. SASB issuance surpassed $21 billion by the end of February, which is already more than the entire year of 2023, which was under $20 billion in total.
Meanwhile, the market demonstrated continued versatility with five conduit transactions exceeding $4.2 billion in February, confirming issuers’ ability to successfully place pooled deals with investors.
Source: Commercial Mortgage Alert, Morningstar Credit
In February, a single CRE CLO transaction reached the market, valued at $800 million, pushing the year-to-date total to $6.25 billion. Though the solitary deal might appear underwhelming following January’s five transactions, industry sources we spoke to attribute this to timing considerations rather than market weakness and they anticipate several new deals will materialize in March.
Source: Commercial Mortgage Alert, Morningstar Credit
The extraordinary surge in February’s non-agency CMBS issuance signals renewed confidence in commercial real estate debt markets despite lingering economic uncertainties. With SASB volumes already surpassing 2023’s full-year totals and conduit transactions showing resilience, market participants are cautiously optimistic about sustained momentum through 2025.
Industry experts anticipate this robust activity will continue as relatively stable spread environments and strong investor demand persist. The expected increase in CRE CLO issuance in March further underscores this positive outlook. While challenges remain in certain property sectors, particularly office space, the diversification of collateral types and strong sponsorship in recent deals suggest the market has adapted to post-pandemic realities.
As we move deeper into 2025, all eyes will be on whether this remarkable pace can be maintained, especially as the Federal Reserve considers its monetary policy trajectory alongside a rapidly changing environment in Washington. For now, the message is clear: the non-agency CMBS market has not only recovered but is thriving at levels not seen since before the Global Financial Crisis.
