21 Industries Exposed to a Refinancing Squeeze as Debt Rolls Over

Higher borrowing costs can strain borrowers when debt matures just as earnings weaken, collateral values fall or access to new capital tightens.

A refinancing squeeze develops when three pressures arrive together: debt matures, replacement financing carries a much higher interest rate, and the borrower cannot raise prices, increase earnings or sell assets cheaply enough to absorb the additional interest expense.

That matters in 2026 because borrowing costs remain well above the ultra-low-rate period. As of July 29, 2026, the federal funds target range was 3.50%–3.75%. In commercial and multifamily real estate, about $875 billion of mortgages mature in 2026 and another $652 billion in 2027, according to the MBA figures cited in the source material.

A company that borrowed $100 million at 4% would have annual interest expense of $4 million. Refinancing the same debt at 8% raises that expense to $8 million.

With EBITDA of $10 million, interest coverage drops from 2.5 times to 1.25 times. If EBITDA also falls to $8 million during a recession or period of weaker consumer spending, nearly all operating profit would go toward interest.

The same basic mechanism runs through the 21 industries below, although the source of the pressure differs.

1. Collateral repricing

Property-related borrowers face more than higher interest expense. The collateral securing their debt may also be worth less than when the loans were originated.

An apartment building producing $5 million of net operating income would have an implied value of about $125 million at a 4% cap rate. At a 6% cap rate, the implied value falls to about $83 million even if the property’s income is unchanged.

For a property carrying an $80 million mortgage, that decline can make refinancing much harder because a lender may no longer be willing to replace the full amount of the existing loan.

1. Office real estate

Office owners face higher refinancing rates alongside weaker occupancy and property values.

Potential refinancing pressures include:

• lower occupancy;
• lower rents or larger tenant incentives;
• higher cap rates;
• lower appraisal values; and
• more cautious lenders.

An owner with a $70 million loan might qualify for only $45 million to $50 million of new financing, requiring additional equity to close the gap.

About 17% of office mortgages covered by the MBA survey mature during 2026.

2. Commercial construction

Construction loans are often relatively short-term. The expected financing path is generally:

• construction loan;
• project completion;
• stabilization of occupancy; and
• refinancing into permanent debt.

If permanent financing becomes substantially more expensive, the completed project’s economics may no longer support enough debt.

Developers may then need:

• additional equity;
• a loan extension;
• a discounted sale; or
• a restructuring.

Construction costs also rose considerably during the post-pandemic period, adding pressure to the capital structure.

3. Hotels

Hotels combine large fixed costs with cyclical revenue, leaving them exposed to both expensive refinancing and volatile cash flow.

The maturity concentration is also relatively high. MBA data cited in the source indicate that about 30% of hotel and motel mortgage balances mature in 2026.

4. Regional and community banks

Banks are usually not the underlying property borrowers. Their exposure comes from owning the loans.

The pressure can move through the system as follows:

• property values fall;
• borrowers restructure or default;
• banks recognize losses;
• bank capital declines; and
• lenders tighten credit.

That can make commercial real estate refinancing more difficult and potentially deepen weakness in the sector.

Smaller regional and community banks can be particularly sensitive when commercial real estate represents a large share of their loan portfolios.

5. Multifamily and apartment syndications

Many apartment deals completed around 2020–2022 were based on combinations of:

• low borrowing rates;
• rising rents;
• high occupancy;
• low cap rates; and
• relatively easy refinancing.

Some also used floating-rate bridge debt.

If rents fail to rise enough while financing costs increase, distributions can disappear. More importantly, the property may be worth less at refinancing than originally assumed.

Around 13% of multifamily mortgage balances in the MBA survey mature in 2026.

2. Shadow lenders

In this group, the vulnerability moves from the borrower toward the financial companies funding riskier borrowers.

The chain can run from investors or banks to a shadow lender and then to the borrower. When borrower quality deteriorates, losses can move back through that chain.

6. Private credit funds

Private credit funds often lend to leveraged, sponsor-backed companies, including borrowers with relatively thin interest coverage.

Many loans are:

• leveraged;
• floating-rate;
• sponsor-backed; and
• extended to companies with limited room to absorb higher interest expense.

As rates rise, borrower stress can lead to:

• payment-in-kind interest;
• covenant amendments;
• loan markdowns;
• non-accruals or defaults; and
• declines in private-credit fund net asset values.

The source also notes an important qualification. A Reuters analysis of 74 BDC and private-credit portfolios found relatively limited 2026 maturities, with larger concentrations around 2028–2029.

Private credit’s 2026 exposure is therefore more closely tied to deteriorating borrower quality and refinancing conditions than to a single large maturity wall.

7. Subprime auto lenders

Subprime borrowers are already financially stretched, making affordability sensitive to higher interest rates.

The pressure can come from several directions:

• higher monthly payments;
• rising delinquencies or defaults;
• more expensive warehouse credit lines;
• tougher securitization conditions; and
• weaker recovery values if repossessed vehicles sell below the outstanding loan balance.

Funding costs can therefore rise at the same time that credit losses increase.

8. Specialty finance companies

Specialty finance businesses often borrow in wholesale markets and lend those funds onward.

Their profitability depends on the difference between:

• interest received from borrowers;
• their own funding costs; and
• credit losses.

If funding costs rise from 4% to 7% while defaults also increase, that spread can narrow quickly.

9. Non-bank mortgage lenders and servicers

Many non-bank mortgage businesses rely on sources including:

• warehouse facilities;
• securitization;
• servicing cash flows; and
• capital markets.

Higher mortgage rates can also reduce refinancing and origination volumes.

That leaves the industry vulnerable to a combination of higher funding costs, fewer new mortgages and greater liquidity pressure.

3. Consumer-demand-sensitive businesses

These companies are not necessarily the most indebted. Their problem is that earnings can fall just as refinancing costs increase.

Because lenders assess debt partly in relation to EBITDA, a fall in earnings can push debt-to-EBITDA ratios higher even when the company has not borrowed more money.

10. Casual dining

Consumers can reduce restaurant spending relatively quickly.

Restaurants also carry substantial fixed or semi-fixed expenses, including:

• leases;
• labor;
• food;
• utilities; and
• franchise obligations.

A modest drop in sales can therefore produce a larger decline in EBITDA, reducing the cash available for debt service.

11. Mall-based retail

Mall-based retailers face similar demand pressure while also carrying lease and inventory costs.

A consumer pullback can lead to:

• lower sales;
• greater inventory markdowns;
• weaker gross margins; and
• lower EBITDA.

Lease and debt obligations, meanwhile, remain.

12. Airlines

Airlines combine cyclical demand with large fixed costs, including:

• aircraft leases and debt;
• labor;
• airport costs;
• fuel; and
• maintenance.

Relatively small changes in passenger demand or fares can produce large movements in profit, leaving heavily indebted airlines more exposed when refinancing becomes expensive.

13. Advertising and marketing agencies

Advertising budgets can be cut quickly when corporate clients become cautious.

Hiring or production spending may continue while marketing budgets are frozen, causing agency revenue and EBITDA to fall. That weakens debt-service capacity just as refinancing costs may be rising.

14. Furniture, home improvement and big-ticket home goods

Demand in these categories is closely connected to:

• housing transactions;
• consumer confidence; and
• financing costs.

Home purchases often trigger additional spending on furniture, appliances, renovations, flooring and other home improvements.

Higher mortgage rates can suppress housing turnover, while households that remain in their homes may postpone discretionary purchases of $5,000 to $30,000.

4. Unprofitable growth companies

These businesses face a different problem: they do not generate enough internal cash to finance operations and therefore depend repeatedly on outside capital.

That model becomes harder when investors demand stronger returns and financing is more expensive.

15. Unprofitable EV manufacturers

Vehicle manufacturing requires large amounts of capital for:

• factories;
• tooling;
• battery development;
• inventory;
• research; and
• distribution.

Companies that are losing money on each vehicle or have not reached sufficient scale can find debt refinancing increasingly difficult.

They may then have to seek equity financing, potentially at much lower valuations.

16. Unprofitable consumer-tech and DTC startups

The common growth model has been to raise capital, spend heavily on customer acquisition, expand revenue and pursue profitability later.

When financing becomes harder:

• fundraising becomes more difficult;
• marketing spending is cut;
• growth slows;
• valuations fall; and
• later funding rounds become harder to complete.

17. Private higher education

Private schools generally carry substantial fixed costs, including campuses, buildings and debt, faculty and administration.

If enrollment falls, tuition revenue declines while much of the cost base remains.

That can leave weaker institutions with substantial borrowing under greater debt-service pressure. The source distinguishes these institutions from elite universities with large endowments.

18. Clinical-stage biotechnology

Clinical-stage biotechnology companies can have little or no product revenue while maintaining high research and development spending.

They may require hundreds of millions of dollars before reaching commercialization.

When financing becomes more expensive, companies may have to:

• issue additional equity;
• license assets;
• cut research;
• merge; or
• shut down programs.

A failed clinical trial can make refinancing effectively unavailable.

5. Highly leveraged operators

These businesses are vulnerable because debt is already large in relation to cash flow. Even a relatively small increase in borrowing costs can therefore have a substantial effect on interest coverage.

19. Private-equity-owned healthcare services

Private-equity acquisitions frequently use significant leverage.

Healthcare operators can simultaneously face:

• wage inflation;
• nursing shortages;
• reimbursement pressure;
• insurance reimbursement delays; and
• regulatory costs.

That can compress EBITDA while interest expense increases.

For example, $500 million of debt at 5% produces $25 million of annual interest expense. At 9%, that rises to $45 million, an additional $20 million a year without any expansion of staff or facilities.

20. Trucking and freight

Trucking is highly cyclical. When excess capacity develops, freight rates can fall while operators still have to pay for:

• truck and equipment financing;
• insurance;
• drivers;
• maintenance; and
• fuel.

A company that financed its fleet at lower rates can therefore face declining freight revenue at the same time that refinancing costs increase.

21. Staffing and recruiting

Recruiting can weaken early when companies become cautious because new hiring can be frozen quickly.

For leveraged staffing businesses, falling revenue can reduce EBITDA and push debt-to-EBITDA ratios higher even without an increase in borrowing.

Five paths to the same refinancing problem

The 21 industries fall into five broad types of exposure:

• Collateral repricing: Asset values fall, leaving the new loan smaller than the old one.
• Shadow lenders: Borrower credit deteriorates while the lender’s own funding becomes more expensive.
• Consumer-sensitive businesses: Lower spending reduces EBITDA just as debt costs rise.
• Unprofitable growth companies: Businesses that continually need outside capital find financing harder to obtain.
• Highly leveraged operators: Existing debt is already large relative to cash flow, making higher rates harder to absorb.

These pressures can also reinforce one another. Higher rates can weaken property values, create refinancing gaps and increase lender losses. Tighter credit can then reduce business and consumer spending, lowering corporate EBITDA and increasing default pressure.

The source includes an important caveat: 2026–27 is not necessarily a single universal maturity cliff across all 21 industries. Some companies refinanced or extended leveraged-loan maturities during 2024–25, shifting substantial amounts toward 2028, while stronger borrowers can still obtain capital.

The risk is therefore better viewed as a multi-year repricing process, with financially weaker borrowers likely to face pressure first.

Commercial real estate has one of the clearest near-term maturity concentrations. MBA estimates cited in the source put commercial and multifamily mortgage maturities at $875 billion in 2026 and $652 billion in 2027.

The central measure is not simply the amount of debt outstanding, but the relationship between new interest expense and sustainable cash flow.

When that burden becomes too large, borrowers generally face four options identified in the source:

• inject equity;
• sell assets;
• restructure the debt; or
• default.

TL;DR:
Higher refinancing costs can expose borrowers when debt matures as earnings weaken, collateral values fall or access to capital tightens. The source identifies 21 vulnerable industries, with commercial real estate facing $875 billion of mortgage maturities in 2026.

AI summary:

• A rollover squeeze occurs when maturing debt must be refinanced at substantially higher rates while cash flow or asset values cannot absorb the increase.
• Commercial real estate faces about $875 billion of mortgage maturities in 2026 and $652 billion in 2027.
• Office, hotels and multifamily face both higher financing costs and possible declines in collateral values.
• Private lenders, consumer-sensitive businesses and unprofitable growth companies face different versions of the same refinancing pressure.
• The source describes the risk as a multi-year repricing process rather than a universal 2026–27 maturity cliff.