The tightening cycle for commercial real estate debt has just about run its course according to the Federal Reserve’s quarterly Senior Loan Officer Opinion Survey on Bank Lending Practices. In the just-released October survey, 3.6 percent of respondents said they tightened standards for commercial real estate loans in the prior three months, the lowest level in 4 ½ years. Just under 2 percent reported stronger demand for loans from creditworthy borrowers, the first positive reading in 4 ½ years. Anecdotal evidence indicates that large, well-capitalized lenders are competing for the best credits, i.e. loans to strong borrowers for core properties in primary, supply-constrained markets. But smaller regional and community banks continue to clean up problem loans left after the debt bubble burst, taking national property price indexes down by 40 percent from late 2007 to late 2009 before firming over the past year. Commercial mortgage-backed securities are making a comeback while insurance companies and GSEs remain active. Overall, debt capital is available for deals that make sense, and there is strong competition for the best deals. The decision by the Federal Reserve to purchase $600 billion of Treasury securities, a strategy called quantitative easing, could make debt capital even more available by encouraging lenders and investors to take on more risk.