Private Credit Is Challenging Banks and Changing the Terrain of CRE Finance
Commercial Observer reported on the evolution of private credit in commercial real estate, transforming from a minor financing option two decades ago into a $1.7 trillion industry expected to double by the end of this decade. Madison Realty Capital's Josh Zegen highlights that the market now views private credit as a first option rather than a last resort, creating robust competition with traditional banking institutions. From 2013 to 2023, U.S. private credit grew dramatically from $141 billion to $853 billion, fundamentally changing the lending landscape. This evolution reflects both market education and adaptation, with borrowers increasingly turning to private credit for speed, flexibility, and customized deal structures, especially following the 2023 regional banking crisis.
