Analysts at Kroll Bond Rating Agency predict issuance in bonds backed by commercial mortgages could hit $125 billion next year, even with borrowing costs rising as interest rates go up.

The final tally for this year is likely to surpass $100 billion, up from $84.2 billion in 2014.

The analysts said that the main fuel for higher CMBS volume in 2016 will be the same economic growth underpinning the Fed's recent rate hike.

Still, commercial real estate is already overvalued in some markets of the country, especially those with a looming supply of new buildings, which should put pressure on rents.

The pace of falling vacancy rates in the retail segment this year — 5.9% in 3Q 2015 from 6.5% a year earlier — is unlikely to be repeated in 2016. Beginning the following year, new supply is expected to outstrip absorption.

Retail exposure accounts for about 25% of outstanding CMBS through 3Q 2015.

The office market, accounting for the low-to-mid 20s as a share of overall CMBS, is forecast to keep seeing a decline in vacancy rates until 2018, when new spaces are forecast to come online.

The multifamily segment, meanwhile, is expected to see vacancy rates rise "slightly" next year as the number of these rental properties coming into market exceed the demand.

Echoing the view of other observers, Kroll's analysts see underwriting standards eroding further in 2016. This year "CMBS metrics weakened as leverage and interest-only exposure climbed to new post-crisis highs," they wrote. The analysts expect the pace of deterioration to be more or less the same next year.

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