WAY Wednesday | October 8, 2025

QuadReal, established in 2016, is a Vancouver-based global real estate investment, development, and operating company managing approximately $94 billion in assets. Leveraging a vertically integrated platform across equity, debt, development, and operations, QuadReal invests in and manages a diversified portfolio spanning residential, including student housing, industrial, data center, office, retail, and self-storage sectors worldwide. With a commitment to innovation, sustainability, and long-term value creation, the firm partners with leading institutions and programmatic platforms to deliver resilient performance across market cycles. Recognized for its scale, discipline, and forward-looking approach, QuadReal is a trusted partner to the WAY Capital team.

Capital Types: Senior Debt, Sub-Debt, Common Equity
Financing Types: Bridge, Construction, Land, Perm
Asset Classes: Multifamily, Industrial, Retail, Data Center, Self-Storage, Student housing
Geographic Focus: Nationwide

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Market Minute – Average Loan Size and LTV by Lender Type

CMBS resurgence in size, tempered by structure
CMBS lenders have returned to the market with larger average loan sizes—peaking near $27.9M in 2025 (up from $26.4M in 2024 and more than double the 2020 average of $12.1M)—signaling renewed securitization appetite and investor demand for scale. However, average loan-to-value ratios remain steady around 63–64%, reflecting a cautious structural stance despite higher issuance. Debt buyers are emphasizing stronger collateral and clearer cash flow visibility, tempering the market’s expansion. CMBS now accounts for roughly 21% of total originations, reaffirming its selective but substantial market role.

Banks are tightening relative to peers
Banks continue to serve as the market’s backbone but are doing so through a shift from direct CRE loans toward note-on-note financing, catering to debt funds seeking back leverage. Banks share of total originations rose to 33% in 2025 (from 27% in 2024), though underwriting standards remain conservative. National banks are prioritizing lower-leverage, higher-quality loans, while regional and local banks remain constrained, averaging loan sizes below $7M and maintaining flat LTVs amid balance sheet and regulatory pressures.

Investor-driven capital remains the most aggressive
Investor-driven lenders (including private credit funds and debt funds) have become the most active and aggressive participants, offering larger loans averaging $17–20M+ and LTVs approaching or exceeding 69–70%, the highest among peers. Their market share has climbed to 14% of total originations, as they step into the void left by banks’ retreat from direct CRE lending. Supported by record dry powder—the MSCI “Dry Powder Index” up more than 150% since 2020—these lenders are sustaining liquidity, particularly across multifamily and industrial assets where yield opportunities remain strongest.

Insurance companies are steady but selective
Insurance companies maintain their role as disciplined, reliable lenders, issuing mid-to-large loans in the $17–25M range while keeping LTVs near 60%. Their capital deployment remains concentrated in core, high-quality assets that align with risk-matching mandates. Though insurers’ overall market share remains modest, their consistent presence provides much-needed liquidity and stability in a market otherwise characterized by cyclical and yield-driven shifts.

Takeaways

Market bifurcation solidified: Institutional lenders (banks, insurers) pursue low-leverage, low-risk strategies, while private and CMBS channels compete for yield through larger, higher-LTV executions.

CMBS revival with restraint: Average loan size up to $27.9M, but LTVs steady near 63%, reflecting scaled issuance with conservative structure.

Banks cautiously re-entering: Combined share rose to 33% of originations yet underwriting remains conservative; regional banks dominate the sub-$10M space.

Investor-driven lenders (debt funds) filling the void: Share up to 14% of the market; LTVs hit 69%, the highest among peers, with strong growth in multifamily and industrial.

Private credit expansion continues: Record dry powder levels support investor-driven growth, sustaining liquidity where banks have pulled back.

Construction lending reshuffled: Investor-driven lenders now lead (30%), while the banks share has fallen well below pre-2020 norms.

Leverage premium compressing: Higher mortgage rates have eroded the return amplification of debt, making intrinsic asset performance more decisive.