It’s been a good run for us in all sectors but that will clearly be coming to an end. I think the article nails it regarding industrial moving forward as being an outlier with vacancy remaining steady for a few years. We’ve been gearing up to find higher leverage on office and retail properties since those sectors will lag an invariably need more capital than in the past few years.
The other trend we’re seeing is on the construction side. The piece mentions increases in costs and it seems be getting worse with all the tariffs being put in place so we’re working with a lot more non bank commercial real estate lenders to get these deals done. Hopefully there won’t be a double whammy with commercial real estate mortgage interest rates increasing this year.
– Adam Horowitz (Principal of Lever Capital Partners and President of the Real Estate Capital Alliance).