Private Credit’s Rising Role in Commercial Real Estate

Bloomberg Article Says ‘Shadow Lenders’ are Increasingly Important

Private credit is playing an even more significant role in funding commercial real estate loans in America, according to a recent article from Bloomberg.

An April 2023 article by Carmen Arroyo and John Sage said while regional banks account for approximately 70% of American banks’ commercial real estate loans, that number is being scaled back, a response to a regional bank crisis in the U.S. and increasing loan defaults.

Because bond markets have dried up, too — commercial mortgage bonds are down by 82% in the past year, according to Bloomberg — a rising group of “shadow lenders” are using private credit to fill the void.

Continue reading the Bloomberg article to learn more about how private credit is increasingly important in financing commercial real estate.