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Good Morning Everyone

While headlines buzz about the Willis Tower mega-extension, the real story unfolds in what I call "The Ocean 11% Heist" - and pulling it off requires more finesse than cracking the Bellagio vault. As Ocean needed 11 specialists, developers are stacking diverse capital sources to survive. Take West Harbor's $61.5M hybrid financing - they combined senior debt with C-PACE in a move that would make even Rusty Ryan raise an eyebrow. The new normal is the paradigm, "Frankenstein Financing," where 3+ capital sources are needed. With MBA data showing 43% of 2025 maturities needing this creative approach, the winners will be those who, like Ocean's crew, can think three steps ahead and make it to the next cycle.

This week's top deals and lenders plus:
💚 Industry Winners & Losers
🎯 Tips For CRE Borrowers
🔄 Opportunities for CRE Brokers, Lenders, Developers, Investors, and RE Agents
💎 New Loan Programs

Let’s dive in.

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I hope you find value in today's newsletter if you seek insights on CRE lending trends, financing strategies, and active lenders for your next deal.

Bridge Loan Guy
Top Loans of the Week

Construction Loans: Vici Properties/Eldridge Industries (Mezz), Tyko Capital, Lightstone Capital (bridge to complete)
Refinance: Blackstone Mortgage Trust, Forbright Bank
Bridge Loans: Peachtree Group, Silver Arch Capital Partners, EBSC Lending
Acquisition Loans: Deutsche Bank, J.P. Morgan
CMBS & Fixed-Rate Instruments: KeyBank, JP Morgan, Citigroup, PGIM RE
C-PACE: Nuveen Green, Oceanview Life & Annuity Co.

Largest single deal: $1.3 billion CMBS loan extension for Willis Tower (Blackstone)

Number of states involved: Transactions spanned 22+ states, from California and New York to Ohio and Idaho.

Sectors financed: Retail, Office, Multifamily, Hospitality, Industrial/Flex, Specialty & Mixed-Use, Cannabis

LENDERS: If you want your top loans of the week/month featured in our next newsletter, email a press release or short description of the loan, including any relevant information, to [email protected]

Construction Loans
◾ Manhattan developer secures a $158M construction loan for Turtle Bay condos from Tyko Capital.
◾ San Diego developer grabs a $29.8M construction loan for Kaya multifamily from Lightstone Capital igniting.

Bridge Loans
◾ Driftwood Capital’s Fort Lauderdale hotel lands a $43M bridge loan from Peachtree Group.
◾ Silver Arch Capital provides a $14.5M bridge loan to a Brooklyn developer for unsold The Oosten condos.
◾ Milwaukee operator nets a $19.5M bridge loan from EBSC Lending for a 57-unit multifamily lease-up project.

Refinancing Loans
◾ Forbright Bank’s $32M refi repositions 21 Alpha Group/Intelligent Design’s Crenshaw Plaza strategic reset.
◾ RFR avert 475 Fifth Avenue foreclosure by landing a $160M recap from J.P. Morgan Chase and Citigroup.

CMBS Loans
◾ KeyBank’s $1.3B CMBS extension drives a transformative restructuring of Blackstone’s Chicago landmark property.

Acquisition Loans
◾ Lone Star Funds lands a $145M fixed-rate acquisition loan from Deutsche and JP Morgan for Bank of America Plaza property.

Mezzanine Loans
◾ Cain International’s Beverly Hills mixed-use secures a $300M mezz loan from Vici Properties and Eldridge Industries for a $5.2B luxury vision.

C-PACE Financing (Green/ESG Loans)
◾ West Harbor JV clinches a $61.5M recap for its waterfront “eatertainment” destination, with Oceanview Life & Annuity Co. powering the transformation.
◾ Sweetwater Companies secures a $15M C-PACE construction loan from Nuveen Green Capital and Sundance Bay for Madison Station’s energy-efficient upgrade.

🏆 Winners 
◾ Grocery-Anchored Retail: Crenshaw Plaza's $32M financing through Forbright Bank, anchored by Vallarta Supermarkets with 97% occupancy, shows continued lender appetite for necessity-based retail
◾ Class A Multifamily: PGIM's $345M fixed-rate portfolio financing for Mill Creek and Walker & Dunlop's $81M deal for Baldwin & Sons highlight strong fundamentals and diverse capital sources for quality multifamily assets
◾ Industrial Outdoor Storage (IOS): Alterra IOS’s $189 million financing from Blackstone Mortgage Trust highlights growing investor interest in this niche sector.

❌ Losers 
◾ Traditional Office: While high-quality assets like Willis Tower are securing extensions, Class B and C office properties face stricter underwriting and challenging refinancing conditions.
◾ Hospitality: Despite a $43 million bridge loan for Driftwood Capital’s Fort Lauderdale hotel, the sector remains vulnerable to economic fluctuations.
◾ Under-supported retail centers: Retail projects lacking solid credit anchors secure short-term, high-rate bridge loans, reflecting lender hesitancy in the pure retail space.

📝 Current Tips For Borrowers

1. Extension Engineering

   Structure loans with multiple extension options tied to specific performance metrics rather than flat fees (like Willis Tower deal). Lenders are more amenable to performance-based extensions that align with projected NOI growth rather than traditional extension fees.

2. Capital Stack Engineering

   Consider a "horizontal" rather than "vertical" capital stack. Instead of traditional senior/mezzanine structures, explore parallel financing streams (like combining C-PACE with traditional debt) to optimize the overall cost of capital. This approach can sometimes yield 100-150bps savings on blended rates.

3. Recession-Resistant Structuring

   Build in operating covenant flexibility for potential market downturns. Rather than focusing solely on debt service coverage ratios, negotiate performance metrics that account for market cycles.

🧩 The Rise of "Frankenstein Financing"
The $61.5M West Harbor recapitalization (blended senior debt + C-PACE) and Nuveen’s pioneering $15M Idaho C-PACE deal reveal a structural shift: Borrowers are stitching together 3+ capital sources to navigate tightening lender appetites. This mirrors MBA data showing 43% of 2025 maturities require layered solutions to avoid default.

An emerging pattern is that non-recourse senior loans are now foundational "keystones," augmented by subordinate C-PACE/TIF districts, preferred equity, and asset-specific revenue participation.

Strategy Tip: Pursue capital providers specializing in "gap filler" roles –
◾ C-PACE: Nuveen Green Capital, Petros PACE
◾ Mezzanine: Peachtree Group, Lightstone Capital
◾ Revenue Participation: CrowdStreet, RealtyMogul

Strategy Tip for Small Sponsors
◾ Bridge Loan Specialists: Avatar Financial, Kiavi
◾ Hyperlocal TIF/C-PACE: Petros PACE, EBSC Lending

Actionable Playbook: Structure deals with “modular” capital components that can scale as milestones are reached. Lightstone embedded a ratchet allowing +15% loan increments upon 50%/75%/90% lease-up for the Kaya deal – a template smaller sponsors should replicate.


Opportunities
◾ Brokers: Pursue mixed-use development specialists, especially in secondary/tertiary markets where there's less competition
Best referral partners: Property tax assessors, and local economic development officials.

◾ Lenders: Target Class A suburban multifamily developers in high-growth markets and entertainment-focused retail developments near major tourist destinations

◾ Developers: Convert older retail or office buildings near regional colleges into mixed-use student/young professional housing.
Best referral partners: University real estate departments and local economic development agencies.

◾ Investors: Convert aging motels into workforce housing with micro-retail components.
Best referral partners: Affordable housing consultants and local housing authorities

◾ Real Estate Agents: Create a specialty practice helping traditional retailers adapt their spaces for alternative retail.
Best referral partners: Local zoning attorneys and business license consultants.


😲 Didn’t see that one coming

◾ Shareholders sue Cannabis REIT over looming rent defaults, spotlighting risk in unconventional asset classes – Read
◾ Wells Fargo targets a $84M foreclosure on 4 Westside projects, intensifying risk concerns in adaptive reuse – Read
◾ A lender takes control of Houston's troubled Crowne Plaza via foreclosure, spotlighting distress in hospitality assets – Read
◾ Nikola launches a comprehensive voluntary Chapter 11 sale process, signaling strategic restructuring amid market headwinds – Read
◾ Equinix confronts a new fraud suit as a judge greenlights proceedings, intensifying scrutiny on data center operations – Read

LENDERS, SEND US YOUR LOAN PROGRAMS AND CLOSED DEALS AND REACH OVER 3,500 INTERESTED READERS

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We would love your feedback on what information you want more of. If you have anything interesting to share or a deal that we can help with, reach out to us by sending us an email at [email protected]. Thank you for reading, and enjoy the rest of your week.

Lastly, no content provided by Bridge Loan Guy or Loans, Lenders & Leverage should be considered tax, investing, or financial advice. This email and any other content we provide are for entertainment and education purposes only. We do not claim to provide tax, investment, financial, or other legal advice. Any content provided by Bridge Loan Guy or Loans, Lenders & Leverage is the personal opinion of our owners and/or staff – you should always conduct your own research.