Billions in CMBS loans are sitting idle, reaching maturity with no resolution in sight.

Unresolved loans make up 75% of delinquent loans tied to commercial mortgage-backed securities, up from 42% three years prior.

There are $23B of these delinquent loans at or near maturity, according to Trepp analysis reported by Bloomberg.

Loans originated when interest rates were at or around zero are due for repayment. But in a wildly different environment, with higher interest rates and spiking tariffs on imports, borrowers don’t know their next move, Trepp Chief Economist Rachel Szymanski told Bloomberg.

Some are opting out of the refinancing or repayment routes to resolve their CMBS debt. Instead, many are treading water, paying their interest while waiting until the Federal Reserve gives an update about interest rates. The next decision will be announced July 30, though most investors expect the central bank to hold rates steady.

The stall is bottlenecking the capital markets, Szymanski said.

Not all the frozen loans are distressed, but distress is rising, especially for aging office CMBS debt.

According to Trepp, 11.08% of office buildings tied to CMBS loans are delinquent, a 49-basis-point increase from December and a new record high.

Investors tied to single, older office assets are being hit with losses when loans sell.

A $233M CMBS bundle backed by Sprint’s former HQ, a 20-building office campus in suburban Kansas City, resulted in just $146M for creditors when the loan sold in May. The riskiest portion, worth $65M, was fully wiped out.

Prompted by an unstable market, few refinancing options and falling property values, lenders are sticking to the extend-and-pretend playbook. Instead of taking back assets with falling values, they are stretching loan terms to delay refinancing or payouts.

CMBS loan modifications, Freddie Mac debt and collateralized loan obligations totaled $39B for the year ending in March. Over that year, they doubled from $18.2B.