Pioneering CMBS Creates Unique Background for California Governor Run, Ethan Penner Says
By Andrew Coen September 18, 2025 3:32 pm
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Ethan Penner, a trailblazer of the commercial mortgage-backed securities (CMBS) market three decades ago while leading Nomura Securities, is now looking to govern the most populous U.S. state.
Penner, who was an early adoptee of CMBS as a lending product while serving as CEO of Nomura from 1993 to 1998, launched an independent bid for California governor this week on a business-friendly platform that aggressively tackles the state’s homelessness challenges. Penner said his experience fostering new capital into commercial real estate when banks were hit hard by the savings and loan crisis is an example of how his approach to government would work.
“When the commercial real estate industry was completely in shambles and the entire real estate industry was thrown into collapse, I understood the systems that caused it to collapse,” Penner told CO. “I understood how to create an alternative or new system that stepped up and solved the existential crisis that the industry was facing.”
The gubernatorial campaign announcement by Penner came on the heels of Tokyo-based Nomura re-establishing its U.S. CMBS business he once led. The relaunched unit will be led by former Barclays CMBS lenders Larry Kravetz and Frank Gilhool.
Penner, who is currently CEO of Mosaic Real Estate Investors, is looking to succeed term-limited Democratic Gov. Gavin Newsom in next year’s election. He said modernizing California’s tax and regulatory systems are among his chief priorities, but he is also looking to confront California’s homeless problem with new public safety strategies.
The CRE veteran will face an uphill climb to reach the governor’s mansion in Sacramento, given California’s heavy Democratic majority and the party largely running the state for the last two decades. A number of Democrats have also announced 2026 gubernatorial runs, including Xavier Becerra, who was U.S. secretary of health and human services under President Joseph Biden, and former congresswoman Katie Porter.
Tech entrepreneur Ethan Agarwal is also running as a pro-business Democrat, while billionaire developer Rick Caruso told Bloomberg TV he is seriously deciding whether to run for governor or Los Angeles mayor.
“I think that what California Democrats are looking at today is this is a failed society, and I think that the responsibility for our failure must reside with the people who have been in power for the last 20 years,” said Penner, who noted the state is last in the U.S. for net migration, homelessness and poverty. “I do think that at this unique moment in time many of these Democratic voters are going to be looking outside the Democratic Party for an answer.”
Andrew Coen can be reached at acoen@commercialobserver.com
