Life insurance companies participating in Trepp’s LifeComps index covering commercial real estate loans reported a total return of 1.90% in the second quarter of 2025, comprised of a 1.21% income return and a 0.69% appreciation return. Trepp reported the total return outpaced the National Council of Real Estate Investment Fiduciaries’ Open‑End Diversified Core Equity index by 87 basis points, suggesting that returns on high-quality commercial real estate credit remain relatively attractive to similar-quality equity.Â
Although the LifeComps total return showed a modest deceleration from Q1 2025, income returns improved from the previous quarter. The appreciation component of the LifeComps index advanced through tariff-related Treasury and spread movements. The overall portfolio’s duration shortened slightly from 4.01 to 3.91 in Q2 2025 and benefited from declines in three-year and five-year U.S. Treasury yields.
Sixty-two new loan originations were priced in Q2, with a median term of five years and median coupon of 5.98%. New originations were up from the 34 in Q1 and in line with Q3 2024 and Q4 2024 volumes of 52 and 67, respectively. Â
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