Market opportunities are here, but we're in for a long winter
With the lending market still in a state of uncertainty, Commercial Observer called together a panel of industry leaders to share their strategies for navigating these unprecedented times. Madison Realty Capital Managing Principal and Co-Founder Josh Zegen, told CO that his firm is staying focused on what it knows, which largely centers on value-add construction loans for multifamily developments. Seeing a “general lack of capital” in the area, Zegen and MRC are holding firm while keeping their margins safe by “pushing stuff out two or two-and-a-half years, stressing rents and going lower on a loan-to-cost basis.” Still, MRC’s large debt funds have given it some leeway to expand into new areas that have cropped up in the upheaval caused in some sectors by the pandemic. “We’ve done a number of off-market transactions with banks where they’ve given us seller financing, either because they need a quick closing or it’s one way to bridge the gap when you have a well-collateralized deal and some unknown, as to when that loan may pay off. There are a whole host of opportunities out there.”
