The refinancing wave, also known as the “Maturity Wall”, is reaching its peak in the German real estate market. According to a survey by EY-Parthenon, conducted between August and September 2026 among 90 real estate financing credit institutions and 70 law firms specialising in restructuring, approximately a quarter of financings are due in the next two years. For individual institutions, this proportion is significantly higher. The previously assumed market bottom is interpreted by financing experts merely as a temporary stabilisation within a still strained downturn.
Jean-Pierre Rudel, Partner at EY Real Estate and co-author of the study, assesses the current situation as critical. He emphasises that the refinancing wave is culminating at an unfavourable time, as declining prices, falling valuations, high interest rates and persistent transaction weakness mutually reinforce each other. An immediate response is considered essential, as the failure to implement necessary value adjustments carries the risk of a structural exacerbation of existing financing gaps, as Korbinian Gennies, also Partner at EY-Parthenon and co-author of the study, adds.
Increasing Burden from Non-Performing Loans
The extent of the difficulties is manifest in elevated rates of non-performing loans (NPLs). Nearly a third of the institutions surveyed report an NPL ratio between four and six per cent, while for a quarter of institutions, it is even higher. Almost half of the financiers noted a deterioration in this ratio. In the first quarter of 2026, approximately 6.8 per cent of commercial real estate loans, corresponding to a volume of around EUR 18 billion, were classified as non-performing.
The previously dominant strategy of “Amend & Extend” — bilateral measures such as maturity extensions, covenant adjustments or contract amendments, supplemented by additional equity or shareholder loans — is increasingly reaching its limits. More than 40 per cent of credit institutions stated that they had not found a viable solution in individual cases. Declining real estate values, rising financing costs and tightened credit requirements are eroding the basis for this pragmatic bridging solution, which, according to Mr Rudel, is prospectively becoming a burden itself. Consequently, more comprehensive and sustainable restructuring instruments are demanded.
Price Declines Across All Asset Classes and Outlook
The market expects widespread price declines across all asset classes. The proportion of respondents who anticipate rising real estate prices has plummeted from 30 to two per cent within six months. Even the residential segment, traditionally more stable, is not exempt; here, around ten per cent of players in both the institutional and private sectors expect price declines. Financing costs are perceived as the biggest challenge, while construction costs have lost significance.
- —Office properties are judged most critically, with around 70 per cent expecting price declines; nobody anticipates rising prices here.
- —This segment is simultaneously affected by structural demand weakness (74 per cent), declining values (62 per cent), high financing costs (57 per cent) and growing equity requirements (48 per cent).
- —Retail, hotel and logistics properties are increasingly negatively influenced by the overall economic situation and the financing environment.
A possible market upturn is further postponed into the future. Around 80 per cent of respondents expect rising interest rates in the next twelve months, compared to 16 per cent a year ago; however, no one now expects falling interest rates. The necessary market adjustments and value corrections must be accepted and implemented to bring valuations, financing conditions and market expectations back into alignment, according to Dr Kriemann and Mr Gennies.
