Should I Sell or Refinance My Commercial Property? Here’s the Guide (2026)
What to do with your commercial real estate investment properties in 2026?
In today’s dynamic real estate environment, one of the most common questions property owners face is whether it makes more sense to sell or refinance their commercial property. The right answer depends on a mix of market conditions, your financial goals, and the property’s performance. As we enter 2026, several key factors are influencing that decision.
Understanding the 2026 Market Landscape
The commercial real estate market has seen significant shifts over the past year. Interest rates have stabilized after several cycles of adjustment despite remaining elevated, and property values in many sectors—especially industrial, multifamily, and well-located office spaces—have started to regain traction. More than three-quarters of global CRE leaders are planning to increase their investment levels over the next 12-18 months. However, access to capital remains tight, and lenders are more selective about what projects they’ll finance.
When Selling May Make Sense
Selling can be the right move when an asset has reached a strong point in its value cycle or when future upside appears limited. In some cases, emerging occupancy or operational challenges suggest that capital may be better deployed elsewhere.
For other owners, selling creates an opportunity to reposition a portfolio, pursue a 1031 exchange, or align capital gains with broader financial or estate-planning objectives. When timing and market conditions align, selling can be a strategic way to lock in value, reduce risk, and create flexibility for the next investment cycle.
When Refinancing May Be the Better Option
Refinancing can be an effective strategy for owners who believe in the long-term potential of their property and want to maintain ownership. As loans approach maturity, refinancing may offer improved terms, greater flexibility, or access to additional liquidity. For stable, income-producing assets, it can unlock equity to fund improvements, acquisitions, or other investments without triggering the tax consequences of a sale. With cautious optimism returning to lending markets in 2026, refinancing may also help strengthen cash flow while preserving future upside.
Key Questions to Consider Before Deciding
Before moving forward, property owners benefit from taking a close look at how their asset is performing relative to the market. Understanding the property’s current value compared to outstanding debt, recent trends in the local submarket, and whether returns still align with investment objectives is critical. Tax implications should also be carefully evaluated, as the long-term impact of selling versus refinancing can differ significantly depending on ownership structure and holding period. A comprehensive valuation and financial analysis often provides the clarity needed to make a confident decision.
Both selling and refinancing can be effective strategies in 2026, but the right choice ultimately depends on individual goals, risk tolerance, and capital positioning. Working with an experienced commercial real estate broker helps ensure that decisions are informed by current market realities and aligned with long-term plans. For owners weighing their options, a tailored property evaluation and market outlook can provide the insight needed to move forward with confidence in today’s dynamic environment.
Commercial Brokers International has been helping our clients make the right decisions with their investment portfolios since 2025. If you have any more questions, don’t hesitate to reach out to us at 310-943-8530 or info@cbicommercial.com.
Our trusted lending partner Icon Capital Advisors assists commercial real estate owners and investors in obtaining the most appropriate financing for their assets. Considering refinancing your investment property? Call 424-320-9870 or email info@icateam.com.