The bid-credit gap is closing as buyers catch up

JLL's Global Bid Intensity Index now sits well above where it stood a year ago, and the latest month's move is the sharpest in a year: June was the jump, and July produced the second-highest number of unique bidders since the index began. That is equity arriving late to a party the credit markets have been hosting for months. The credit side remains the obvious leader — JLL's Credit Intensity Index still runs materially above its 2021 record highs even after average winning loan-to-value rates and distinct lender volumes moderated from April — so lenders are still competing harder for deals than buyers are. But the gap between the two indices peaked in May and is now compressing, which JLL reads as healthier functioning across global commercial real estate capital markets.

This publication argued yesterday that credit is back but buyers are still catching up, and the latest data supports that reading, with the bid-credit spread narrowing for two months. What remains unresolved is how much of that compression is buyers stepping up and how much is lenders stepping back; the moderating LTVs suggest some of the latter, while the expanding buyer pools point to the former.

The indices measure competition, not closings — how many bidders are showing up and how hard lenders are pushing, rather than whether contracts are getting signed. The gap between intent and closed volume is where the rest of the year will be decided, and the compression is a sign that the intent is becoming real.

From a transaction perspective, the compression matters more than the levels because a wide gap means the lender is leading the deal and equity is hesitant — a recipe for slow volume — while a narrowing gap is the precondition for a real recovery in closed transactions, the bid side finally willing to meet the credit side. The last two months have pointed in that direction.

The stronger bid is also showing up in the size of deals getting done, with JLL tying the conviction to commercial real estate's relative value proposition and seeing the confidence increasingly evident in larger transaction sizes. That is what a broadened buyer pool should produce — not just more bids, but larger commitments.

That bid intensity improved while macro uncertainty persisted makes the move more meaningful: investors are making relative-value calls, not waiting for clarity. The credit side has been giving them the clarity — with liquidity as strong as it is, the underwrite is no longer about loan availability but about asset-specific pricing and the competition for any given property.

Richard Bloxam, CEO of Capital Markets at JLL, puts the moment in plain terms: "Liquidity is back—and building." The credit strength over the past year, he says, is now directly propelling transaction activity, with lender confidence spreading into the equity market, and his phrase "with clear intent" describes a bid side that has moved from watching to acting.

The question is whether the catch-up has more room to run. The compression since May has been driven by both sides — bid intensity has improved while credit intensity has moderated from its peak — and if that dual move continues, the market should see the recovery translate into volume. If the credit side re-accelerates and the spread widens again, the recovery remains hostage to the same imbalance.

For investors, the practical implication is about timing: the settlement price in any trade depends on who is more eager, the buyer or the lender. Right now, the two are converging, which is exactly the moment when transactions get done. The JLL data will not tell you which assets are on the block, but it does tell you the window for buying at today's bid is unlikely to get wider — and that argues for acting on the liquidity rather than waiting for it.