Frank Gilhool

Is it better to be a lender or borrower today?  

I think being a lender edges out a borrower, but I’m biased having been a warehouse lender throughout my career (and liking to sleep well at night). Lending in the transitional bridge space benefits enormously because the lender sets the key terms: basis, extension tests etc.  

Borrowers, on the other hand, carry the weight of having to execute on business plans that are always moving targets.

What is the biggest challenge you’ve encountered as a lender in 2026?

It’s the same every year: maintaining discipline. This will be further challenged by the current rate environment putting additional pressure on underwriting and business plans.

Has the can been kicked fully down the road when it comes to loan extensions, or is there more leg action to come?  

More to come, but we are getting toward the end of the road as lenders and borrowers face reality. We see lenders presenting us deals that are well structured that provide time to execute on a credible plan. If the plan fails, the lender is prepared to take (“the can”) over.

Which property sector is most attractive from a lending perspective today, and which are you most cautious about? 

That’s easy: multifamily at a good basis that isn’t underwritten to perfection or requiring epic rent growth.  

Overall, however, it’s less to me about the sector and more about the property and the market it sits in. I’m generally agnostic to the property type so long as it is in a durable market with solid fundamentals. That said, Class B and C office will continue to struggle, and we do have concerns with student housing given the demographic cliff and foreign enrollment’s impact on rent growth, combined with the expectation of continued expense growth, making student housing a bifurcated sector.

How are projections for higher-for-longer interest rates impacting your lending strategy today? 

Don’t rely on rate cuts to get you home. Rely on loan structures that can tolerate elevated rates and exits that are realistic about valuations and debt yields.

What’s your competitive edge in deals today, and who are you competing against most often (banks or non-banks)? 

Strong relationships are at the core of our competitive advantage. Being part of the much larger Nomura securitized products platform with its deep and long-standing relationships has been critical to our success, as we have built our business over the past year. 

On the day-to-day running of the business, given the universe of warehouse lenders is relatively small and competitive, we differentiate ourselves through quick and thoughtful responses, whether positive or negative. This responsiveness is something we believe we do very well.

Do you expect more or fewer loan sales in the year ahead?

We expect more sales because of the following factors: Fatigue from both lenders and borrowers with the extend-and-pretend strategy and hitting refi deadlines; lenders pruning their portfolio of the circa 2020 vintage loans at 3 to 4 percent; ongoing elevated interest rate concerns; and demand from debt funds remaining strong.

What is the most important thing you’ve done as a lender to protect your loan portfolio over the last year? 

Establishing relationships with strong lenders combined with good underwriting.

Is AI indeed going to kill us all? 

It may, but in the meantime, we are using it constantly and loving it.

Biggest headwind and tailwind to lending activity in 2027? 

Rates pressure.

Lightning Round:

“Traitors” or “Alone”? Neither. I watch credit spreads.

Super Bowl or World Cup? Super Bowl.

Orcas or yachts? Yachts that don’t attract orcas.

If you could train AI to do one new thing, what would it be? To pick lotto numbers.

Best vacation you ever took? My three-month garden leave during the summer of 2025.

Sun Belt multifamily or Boston life sciences? Sun Belt multifamily.

Friend, marry, kill: Office, multifamily, data centers Data centers,
multifamily, and I couldn’t hurt a fly.

Book reader or phone scroller/email checker before bed? Catching up on reading Commercial Observer.

Fitness activity of choice? Squash.

Holiday wish? My daughter and her baby’s health, as she is due this coming holiday.

“Power” song you listen to when mentally preparing for a big event/deal/day? “I Won’t Back Down” by Tom Petty.