The Owner-Occupied CRE Quarterly

First-quarter 2026 was the strongest opening quarter on record by dollar volume: $2.45 billion across 1,445 loans, up nearly 7% year over year even as the loan count fell 13%. The catch is timing. The Oct-Nov shutdown closed October approvals and pushed a backlog into January 2026, which ran about 1.5 times a normal month, so part of the dollar record is post-shutdown catch-up rather than pure new demand. The year-over-year read is still clean, though: Q1 2025 was an uninterrupted full quarter, and this quarter cleared it by 7%.

The deal mix shifted decisively larger across all three quarters. Deals under $1 million fell from 54% of approvals to 41%, while deals of $2 million and up climbed from 23% to nearly a third of the market. The $1 to $2 million tier held around 27%. That up-market shift lifted the median deal to $1.25 million, a 33% increase year over year, and signals that the most active buyers in this segment are businesses taking on larger real estate commitments.

Of roughly 43,000 owner-occupied CRE loans outstanding today, 96.5% are performing and only 3.5% sit in some stage of distress, less than half the 9.0% distress rate across the rest of the 7(a) portfolio. The reason is collateral: when these loans go bad there is a building behind them, so they rarely end in a full write-off. Across more than 30 years of lending, just 34 owner-occupied CRE loans, a 0.02% lifetime loss rate, have ever charged off.

Hotels and motels surged to 13.9% of approvals by loan count, nearly doubling their 7.9% share from a year earlier, the sharpest industry shift in the quarter. Geography held its pattern: California and Texas together took more than a quarter of the market, and California has anchored between 15 and 20% of national volume in each of the last five first quarters, a durable concentration that reflects where owner-occupier demand runs deepest.

The OO CRE market belongs to no single player. In Q1 2026, no lender captured even 8% of the quarter's gross approval dollars, making this one of the most fragmented segments in the SBA book and leaving meaningful share available to any institution that wants to compete. Ranked by Q1 2026 gross approval volume.