At Commercial Observer’s National Institutional Investor & Private Equity Forum, RXR Executive Vice President, Chief Strategy Officer & Head of Equity Capital Markets, Scott Crowe, described a structural shift that has occurred across the lending industry, with banks becoming more risk averse, especially after the regional banking crisis of 2023. Crowe shared that amid several bank failures, the banks left standing have opted for loan-on-loan financings with debt funds rather than direct lending into real estate projects.
Addressing a crowded room, Crowe added, “Banks are trying to get out of the real estate business. They’d rather lend to us and be in the safe part of capital stacks and leave the higher loan-to-values (LTV) behind and get closer to the equity. They’d rather see groups like ourselves take this risk.”
