Key Takeaways from the MBA Conference in San Diego: 2025 Financing Outlook
By Matt Shane
I recently attended the Mortgage Bankers Association (MBA) Conference in San Diego, where I had the opportunity to meet with life insurance companies, banks, CMBS lenders, and private debt funds to discuss the current lending environment and opportunities for 2025. Here are some key insights from the conference:
Life Companies Remain Active but Selective
Life insurance companies continue to be a stable source of capital, offering competitive rates for high-quality assets with strong sponsorship. However, they are being more selective, prioritizing lower leverage and well-located properties in primary and secondary markets.Banks Are Tight on Capital, Focused on Relationships
Regulatory pressures and liquidity constraints have banks maintaining a cautious approach. While they are lending, they are favoring existing clients, lower-risk transactions, and shorter-term loans with recourse.CMBS Market Adjusting to Higher Rates
The CMBS market is showing signs of stabilization after a volatile 2024. Spreads have tightened recently, and securitization activity is picking up. Lenders are emphasizing strong debt service coverage ratios (DSCR) and conservative underwriting.Private Debt & Bridge Lenders Filling the Gap
With traditional lenders tightening, private capital and debt funds are stepping up to provide bridge loans and structured financing. While pricing is higher, these lenders are offering flexibility, particularly for transitional assets and value-add plays.Office Sector Faces Challenges, But Deals Are Getting Done
Lenders remain cautious on office properties, particularly in non-core locations. However, well-leased buildings with strong credit tenants and adaptive reuse strategies are still attracting capital. Creative structuring and sponsorship strength are key.Retail & Industrial Holding Strong
Grocery-anchored retail and well-located industrial assets continue to see strong lender demand. Retail lending has improved for necessity-based centers, while industrial remains a top-performing asset class.Multifamily Remains a Preferred Asset, but with Tighter Terms
Multifamily lending is still active, but underwriting has become more conservative due to softening rent growth and increased expenses. Life companies and agencies remain dominant players, favoring stabilized properties with strong occupancy.
Overall, 2025 is shaping up to be a year of cautious optimism in the commercial real estate debt markets. While liquidity is available, lenders are focused on quality deals, strong sponsorship, and disciplined underwriting. If you’re looking to finance an acquisition, refinance a property, or explore creative capital solutions, now is the time to engage with lenders and structure the right financing strategy.
Contact SF Capital today to discuss how these insights impact your financing needs for the year ahead.
