Dealmaking & Financing Update

Features May 5, 2025| | jorenstein

Coverage from Connect Phoenix Multifamily, SFR & BTR 2025

Dealmaking & Financing Update

Featuring:

Mitch Ginsberg
CEO
CommLoan
Moderator

Tyler Bruggman
VP
ABI Multifamily

Andrew Kim
Director
Thorofare Capital

George Maravilla
Partner
Tower Capital

Sam Pewitt
SVP
The Mogharebi Group

Derek Smigiel
Senior Director
JLL Capital Markets

 

Intro

With market volatility and interest rate fluctuations, how can investors make informed decisions?

The Dealmaking & Financing Update talk brought together industry leaders in commercial real estate to discuss the challenges and opportunities in the current market landscape. The panel offered practical perspectives on lending constraints, market sentiment, and capital allocation amidst economic uncertainty.

This Playbook will delve into expert insights shared during the event, highlighting key takeaways on dealing with market volatility, strategies to overcome construction and lending hurdles, and the future outlook for real estate investments.

The Impact of Market Volatility on Real Estate Financing

The current market volatility—driven by interest rate swings, global economic policy shifts, and tariff changes—has created uncertainty in real estate financing. Panelists agreed that private equity and lenders are cautious, waiting for signs of stability before committing capital. The uncertainty in the market impacts construction financing and loan-to-cost ratios, thereby affecting the supply of new constructions.

“We’re living through certainly unprecedented times. With extreme volatility on the ten-year all of a sudden, they don’t know where to underwrite, so they get very conservative.”
— Mitch Ginsberg, CEO, CommLoan

Takeaways

• Monitor bond yields and geopolitical factors (e.g., tariffs) as leading indicators of debt market movement.
• Build flexible deal structures that can adapt to interest rate changes.
• Communicate transparently with lenders and investors about how your project mitigates market uncertainty.

Strategies for Navigating Construction and Lending Challenges

Construction lending has become significantly tighter. Tariffs and cost volatility make it difficult to forecast construction budgets. Many lenders are underwriting more conservatively, reducing LTCs from 70% to 65% or lower. As a result, developers face equity shortfalls and many projects are being delayed or canceled—setting the stage for a sharp supply drop-off in the next 18–24 months.

“All that means less construction will happen. And most of the room knows that supply is gonna fall off a cliff.”
— George Maravilla, Partner, Tower Capital

Takeaways

• Seek early-stage financing partners who understand longer-term supply dynamics.
• Build partnerships with bridge lenders for post-construction transitions.
• Consider secondary and tertiary markets where capital is less concentrated and underwriting may be more favorable.

Future Outlook for Real Estate Investment

Panelists are cautiously optimistic about the second half of 2025 and beyond. While transaction volumes in Phoenix and similar markets dropped sharply since 2021, fundamentals remain strong. There is strong capital interest in Sunbelt markets, especially for newer multifamily assets. Institutional and private investors are lining up to acquire newer, high-quality properties at or below replacement cost, expecting strong rent growth by 2026–2027 due to the coming supply shortage.

“If you can make a deal work today, it should look even better a year or two from now.”
— Tyler Bruggman, VP, ABI Multifamily

Takeaways

• Focus on high-growth markets like Phoenix, Vegas, and Dallas with strong job and population growth.
• Look at 2000s+ construction deals, which are attracting the most institutional interest.
• Prepare for a rent rebound post-2026 as supply dramatically tightens.

 

Conclusion

The Dealmaking & Financing Update session made one thing clear: while short-term uncertainty is undeniable, the long-term fundamentals of real estate—particularly in high-growth markets—remain strong.

From rising interest rates to construction slowdowns and tighter lending conditions, today’s challenges are shaping tomorrow’s opportunities. As developers hit pause and capital waits on the sidelines, savvy investors have a rare chance to position themselves ahead of the next growth cycle.

The experts agree: we’re in a short-term squeeze with a long-term upside. Markets like Phoenix, Dallas, and Vegas are expected to experience accelerated rent growth starting in 2026, driven by a sharp drop in new supply and continued population and job growth. Now is the time to build conviction, tighten underwriting, and start planting seeds for future returns. Whether you’re buying, building, or financing, your success depends on how well you understand the current dislocation and how strategically you move during this window of transition.