Japan Lender Survey 2026

The financing environment for real estate in Japan remains accommodative and continues to provide support to a buoyant real estate investment market. Bank of Japan (BoJ) statistics show outstanding loans to the real estate sector by Japanese financial institutions (includes domestic banks, Shinkin banks, and other financial institutions) reached JPY 147 trillion as of the end of March 2026, up 7% from the previous fiscal year-end. Of this total, loans extended to special purpose companies (SPCs) for real estate securitization reached JPY 19 trillion as of the end of March 2026, up 18% from the previous fiscal year-end, continuing its upward trend. The BoJ's latest Financial System Report (April 2026 issue) identified the growing level of real estate credit exposure as a potential risk factor to financial system stability. However, its overall assessment was that no issues have arisen thanks to prudent credit risk management maintained by financial institutions.

CBRE recently carried out its annual Lender Survey targeting companies that provide real estate financing. This year’s survey, conducted in April and May of this year, asked respondents about their lending activity in FY 2025 (from April 2025 to March 2026) and their expectations for FY 2026. The results suggest no material change in the lending stance of financial institutions, indicating that accommodative lending conditions should persist through FY 2026.

Among FY 2025 lending activity, 33% of senior lenders and 65% of mezzanine lenders reported that 100% of their loan volume was directed toward new acquisitions, with both figures representing an increase from the prior survey. Regarding lending terms for prime assets, LTV criteria remained broadly flat compared to the previous survey, while spreads tightened. Required spreads for mezzanine lenders, which had been on an upward trend in the years through to the 2025 survey, declined across all asset types in this year’s survey, indicating that an increasing number of lenders are considering expanding their focus on or newly entering the mezzanine segment. In addition, "location" saw an increase in responses as an important lending criterion compared to the prior survey, confirming a trend toward greater selectivity among lenders. In terms of preferred asset types, office ranked first among both senior and mezzanine lenders.

Regarding the loan volume outlook for FY 2026, approximately 60% of respondents indicated that volumes would increase from the previous year, with nearly all the remainder expecting no change. Among market risk factors, "rising interest rates" retained top position for the second consecutive year. Over the next 12 months, while 40% of senior lenders and 60% of mezzanine lenders expect spreads to increase, some respondents anticipated spread compression. The proportion of lenders expecting real estate prices to rise over the next 12 months reached 43%, the highest level on record since CBRE first conducted the survey in 2018.