In 2025, multifamily borrowers benefited from a broad, active debt capital landscape. Berkadia worked with 235 unique capital sources and closed more than 1,600 loans totaling $35 billion in originations. Roughly 43% of that volume was placed with third-party capital providers such as banks, insurance companies, private capital funds, and CMBS lenders, with the remainder through the Agencies (Fannie Mae, Freddie Mac, HUD).
This diversification of debt sources reflects a market where borrowers have choices around structure, term, and risk profile. In 2025, we completed loans with 98 banks, 39 insurance companies, 10 conduits, and 84 private capital providers. That breadth speaks to a sustained—and in some cases growing—allocation of capital to commercial real estate (CRE) debt, particularly in the multifamily sector.
Looking ahead, several forces suggest that debt capital should remain abundant in 2026. On the securitized side, we anticipate a more active market as investors gain comfort with the interest rate environment and collateral performance. Fannie Mae and Freddie Mac have each raised their lending caps to $88 billion, signaling continued commitment to the space. Insurance companies are leaning in, targeting shorter-duration loans as they seek yield to match annuity businesses. Banks that had focused on providing back-leverage to private capital funds are beginning to return to direct lending in a more meaningful way.
In an environment of global uncertainty, access to a broad range of debt solutions has become increasingly important. By working with a diversified set of capital providers and structures, Berkadia can align financing strategies with each client’s objectives while helping them navigate shifting market conditions.
Operating fundamentals are a key part of this story. As concessions related to the recent wave of new supply burn off in many markets, rent growth appears poised for upward momentum over the next 6–12 months. While it will vary by market and asset quality, the overall trend points toward stabilization and modest improvement rather than continued deterioration. The pipeline of new construction has slowed significantly. As existing supply is absorbed and limited new product comes online, fundamentals should gain further support.
At the same time, the market is not without stress. Many loans that were previously extended are coming up against new decision points, and we expect distressed sales to increase as private capital funds and banks require action. These situations, while challenging for individual owners, can create opportunities for well-capitalized buyers and underscore the importance of having flexible financing solutions that can accommodate business plans across the risk spectrum.
The CLO market offers another lens into the health and evolution of multifamily debt. In 2025, total CLO issuance reached $30.5 billion, with multifamily collateral accounting for approximately $21.5 billion, or about 70% of the total. That momentum has carried into 2026; more than $9 billion in issuance occurred in the first eight weeks alone. January 2026 saw seven deals totaling $7.5 billion—nearly one-quarter of 2025’s full-year volume. This activity underscores both investor appetite for the asset class and the role of transitional and bridge financing in today’s market.
Against this backdrop, lenders are innovating across products and structures. Shorter-term, fixed-rate bridge loans are increasingly available where they align with a sponsor’s business plan, offering a middle ground between traditional floating-rate bridge debt and longer-term permanent financing. Many firms that historically focused on joint-venture equity have expanded into preferred equity. While preferred equity introduces complexity—especially around intercreditor dynamics with senior lenders—it is often priced below common equity, making it an attractive tool for sponsors seeking to optimize their capital stack.
Within this broader menu of capital options, each transaction is highly specific. Borrowers are placing greater emphasis on flexibility: the ability to prepay, extend, or access future funding as conditions change. Terms, covenants, and structure are being scrutinized as closely as proceeds and rate. In this environment, access to a wide range of capital providers—and a clear understanding of their current appetite—is as important as ever.
While multifamily remains the core focus for many lenders, there is growing interest in adjacent sectors. Dedicated platforms for hotels, student housing, seniors housing, and medical office are seeing increased attention as some capital providers seek yield or diversification beyond traditional multifamily exposure. For borrowers in these sectors, the expanding lender universe may create additional financing options over the next several years.
Berkadia’s role within this landscape is to help clients navigate a complex set of choices. With more than 200 mortgage bankers in dialogue with capital sources, we see shifts in pricing, structure, and risk appetite in real time. That engagement allows us to connect borrowers with capital solutions that align with their objectives, whether in multifamily or across other income-producing property types.
