Short answer
SOFR is the Secured Overnight Financing Rate, published daily by the Federal Reserve Bank of New York. It is the post-LIBOR benchmark for most floating-rate CRE loans. Most loans use a 30-day average SOFR (or term SOFR) plus a credit spread , reset monthly.
What replaced LIBOR with SOFR?
LIBOR, the London Interbank Offered Rate, was discontinued for new originations in 2021 and for most legacy contracts by mid-2023. SOFR replaced it as the standard floating-rate benchmark for US CRE.
Most floating-rate CRE loans now reference 30-day average SOFR or 1-month/3-month CME term SOFR. The conversion from LIBOR to SOFR generally added a small adjustment (typically 11 to 26 bps) to keep economic terms equivalent.
Sources
- Secured Overnight Financing Rate (SOFR) · Federal Reserve Bank of New York · daily
- Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations · Mortgage Bankers Association · 2026-Q1