MBA Predicts $827B CRE Lending Surge

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Good morning. After a quiet stretch, CRE lending is gearing up for a big year. The MBA expects a 24% jump in originations as rate cuts begin to stir up demand.

Today’s issue is brought to you by Warespace—deploying $500MM in small-bay industrial, with $200MM already spent across 9 national markets.

🎙️This Week on No Cap: We get an insider’s look at multifamily’s policy future with NMHC President Sharon Wilson Géno, covering today’s biggest legislative wins, looming battles, and what’s really at stake for owners and renters.

Market Snapshot

Lending Comeback

TOGETHER WITH WARESPACE

We’re deploying $500M to acquire industrial properties.

WareSpace is the next generation of small-bay industrial—co-warehousing designed for small and growing businesses. One simple monthly payment covers everything: property tax, utilities, equipment, racking, shared kitchens, and conference rooms—the features small businesses actually want.

We’re actively acquiring flex, industrial, office, and big-box retail properties (50K–250K SF).

New market entrances year-to-date: Los Angeles, Miami, Denver, DC, Charlotte, Salt Lake City, and Phoenix.

We’re still acquiring in all major MSAs.

What we’re targeting

• Immediate or near-term vacancies

• Class A–C assets with loading docks or drive-ins

• Transitional properties that need capex

Have a deal? Send it to VP of Acquisitions, Jeff Jenkins at [email protected].

We close fast, pay cash, and move quickly. Let’s make a deal!

*This is a paid advertisement. Please see the full disclosure at the bottom of the newsletter.

• Capital strategy: Dolfin Partners structured a sale-leaseback for North American Casualty Co.®, unlocking capital and securing long-term occupancy for a mission-critical headquarters asset. (sponsored)

• Transaction surge: CRE deal volume soared to nearly $27B in September, making it 2025’s busiest month yet.

• Cycle reset: Despite rising loan modifications and mounting distress, the CRE credit market is showing signs of a typical downturn—not a full-blown crisis. 

• Shutdown shock: The prolonged U.S. government shutdown is delaying permits, disrupting data, and stirring uncertainty across CRE markets. 

• Cost creep: New tariffs on imported construction materials could raise CRE project costs by up to 4.6%, adding pressure to rents and development budgets. 

• Legal spotlight: The DOJ’s tougher stance on financial transparency, foreign investment, and money laundering is raising the compliance stakes for CRE developers and investors. 

• Asset offload: Douglas Elliman offloaded its property management arm for $85M to slash debt.

• Open uncertainty:  Florida’s open-carry ruling is pressuring property owners to set firearm policies or face legal and tenant uncertainty.

• Build lag: A national housing shortfall of 7.1M units is deepening as multifamily building permits fall behind in high-growth U.S. regions.

• Premium pressure: New York lawmakers are pushing a trio of bills to ease skyrocketing insurance costs for affordable housing landlords. 

• Insurance squeeze: Soaring insurance premiums and tighter policy terms are derailing multifamily deals, hitting smaller owners hardest. 

• Presale surge: Witkoff Group pre-sold $200M worth of Miami Beach condos before launching full marketing or breaking ground.

• Aging opportunity: Berkadia more than doubled its capital for seniors housing loans, targeting California and other U.S. markets.

• Site for sale: Lennar’s multifamily arm is selling a prime South Loop site in Chicago, shelving plans for a 344-unit tower.

• Next-gen renters: Today’s renters are younger, more diverse, and increasingly digital-first, yet rising fees and limited affordability keep them rooted in the rental market. 

• Zoning shortcut: LA developers are pivoting to 100% affordable housing as the city’s Executive Directive 1 slashes approval times and boosts returns.

• Server state: Virginia leads the world in data center growth, but the industry’s massive energy demands and land use are sparking environmental and community pushback.

• Capital infusion: MDH Partners secured $112M from Truist Bank to refinance nearly 800K SF of newly acquired industrial assets across Georgia, Nevada, and California. 

• Perry's power: Rick Perry’s Fermi America has signed deals with Korean firms to build nuclear reactors for a $14B Texas data center campus. 

• IOS expansion: Alterra IOS secured a $150M loan from Blue Owl Capital to fuel its national expansion in the booming IOS sector.

• Expanding footprint: EQT Real Estate has acquired an 11-building, 4.8 MSF industrial portfolio from Hillwood across five major U.S. logistics hubs.

• Glory days: Chicago’s Magnificent Mile is showing signs of revival as crime dips, foot traffic nears prepandemic levels, and retailers return to take advantage of lower rents. 

• Deal season: Retailers anticipate value-driven holiday shopping as cautious consumers seek early deals and trade down to private-label products.

• Leasing power: Retail REITs are entering Q4 2025 with strong fundamentals, buoyed by tight supply, high occupancy, and resilient consumer spending.

• Dollar decisions: Dollar General offers scale and stability, while Dollar Tree draws investors with stronger sales and premium locations—forcing buyers to weigh yield against performance.  

• Spending split: Lower-income consumers are cutting back, while wealthier shoppers keep spending—pushing brands to rethink pricing and product strategies.

• City vision: Extell’s Gary Barnett is betting on Midtown’s future with a new 600-foot office tower anchored by IKEA.

• Office unwind: Brookfield, facing billions in losses from U.S. office properties hit by the post-pandemic downturn, is accelerating asset sales and debt restructuring.

• Distress strategy: Namdar Realty and Mason Asset have a deal to acquire 190 S. LaSalle in Chicago, marking their third distressed office buy in the city.

• Urban exit: Deloitte will exit its 84,000 SF office in DTLA's Gas Company Tower by late 2026, joining a wave of major firms leaving the area.

• Hotel premium: Sotherly Hotels will be acquired in an all-cash joint venture deal offering shareholders a 153% premium, marking the highest REIT buyout premium in five years.

A MESSAGE FROM EQUITY INSTITUTIONAL SERVICES

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*ici.org; This is a paid advertisement. Please see the full disclosure at the bottom of the newsletter.

📈 CHART OF THE DAY