Robert Milne of Prospect Ridge: 5 Questions

Prospect Ridge has closed its second commercial real estate credit fund with $800 million in capital commitments, the firm announced

The Prospect Ridge Real Estate Debt Fund II, which has roughly $3 billions of total lending capacity, will execute first-mortgage loans, mezzanine loans, and preferred equity investments across the U.S. in a variety of property sectors. 

The credit vehicle was rolled out on the heels of Prospect Ridge’s debut $500 million fund that focused heavily on transitional and value-add opportunities.

Robert Milne, managing director and co-head of credit strategies at Prospect Ridge, spoke with Commercial Observer about the goals behind the new fund, deployment plans and how the overall CRE debt markets are shaping up for the rest of 2026.

This interview has been edited for length and clarity. 

Commercial Observer: What was the impetus for launching this second fund?

Robert Milne: We think there’s a great opportunity in the debt markets right now, coming off of the interest rate increases and what’s happened to valuations across a lot of sectors. We think we’re lending against reset valuations in most sectors. We are lending well below replacement cost, but at the same time fundamentals in the sector we’re lending against are very strong. We’re seeing underlying rent growth and strong occupancies. We think we’re at a great point in the market and we’re going to be able to invest the fund well. 

Describe what deployment is typically like for Prospect Ridge credit vehicles? 

The first fund is fully fully deployed and almost fully realized. We were generally targeting institutional borrowers who have business plans that we believe in. They tend to be on the larger end of loans. We target $65 million to $300 million whole loans.

In which property sectors or geographies are you finding opportunities for your transitional and value-add strategies?

The fund targets the U.S. and all real estate sectors. The places where we found opportunities to date have been multifamily, industrial, hospitality, retail, and senior housing, which is sort of a form of multifamily. Those are just some examples of places we’ve lended on over the last couple years. 

How do you see the commercial real estate debt market shaping up for the rest of 2026 and early 2027?

We’re seeing a lot of opportunities come in where we have good borrowers who have good business plans, so we think that’s going to continue to create opportunities for us to lend. I think that’s the market right now: People have good equity business plans, and that creates good opportunities for us to structure something to help them execute them.

What is your goal for deployment of the new fund? 

We like the market opportunity quite a bit right now, so our goal is to be very active. We’ve been very active in the last 12 months and we expect to be very active over the next 12 months. We think the opportunity exists today. 

Andrew Coen can be reached at acoen@commercialobserver.com.