Kim McKee

Describe the past 12 months in one word, then tell us the key lending opportunities you and your team have uncovered.

Promising. Transaction volume has been muted, but we’re seeing a number of encouraging signs. Our payoff volume has picked up to more typical levels, and we’re actively competing in the market trying to put dollars out. We’re still doing multifamily and industrial, and recently have taken advantage of opportunities in areas like lodging, student housing, retail and data centers. In addition, we’ve been active in the subscription line space.

Are rate cuts the silver bullet the industry has been waiting for to solve all woes?

Rate cuts aren’t going to fix everything, and conditions won’t dramatically change overnight. It’s going to take time. But lower rates will provide some much-needed relief and help shift sentiment, which should result in more deal activity. 

What excites you most about today’s lending market?

We’re in a good spot and well positioned to support our clients as the market opens up. The bank is well capitalized and looking to broaden and deepen relationships. We have a large national platform, yet we’re nimble and can provide custom solutions for our borrowers.

Tougher market: GFC or these past four years?

GFC, without a doubt. There was a deep global recession with prolonged high unemployment, a housing market crash, large bank failures, capital market dysfunction and massive government intervention. Versus this cycle: The economy is holding up, stock market is at all-time highs, capital markets are operating relatively efficiently, and most banks are lending. The sharp rise in rates has put pressure on CRE across the board, but most sectors are holding up fairly well with the exception of office.

Who lent you your very first dollar, and what was it for?

Student loans to help fund my law degree. Fortunately, my banking day job financed most of it, which allowed me to keep the debt levels low.

Are you still as enthusiastic about multifamily as you were three years ago?

We continue to lend on multifamily and feel good about the sector. Although there are pockets of oversupply in certain markets, there’s still a substantial housing shortage in the U.S. and the macroeconomic fundamentals are solid. In addition to Class A, market-rate product, we’re looking to do more attainable/essential housing and student housing. 

How much of your activity is note-on-note lending versus direct lending today?

U.S. Bank has been active in the repo and note-on-note space for nearly 15 years. It’s a mature business for us which has performed well through cycles, and it’s an area we intend to continue to grow. 

Lightning Round:

If I could lend money to one person in the world, it would be…Someone who always pays their lender back, in good times and bad times, no matter what. 

AI: Helpful or fad?

Helpful, but it’s still early innings. 

How many days are you in the office today?

Generally Monday through Thursday.

Modify or foreclose?

Modify — a mutually agreed-upon solution is generally the best outcome. 

Pref equity or mezz?

Preferred equity. 

Class B office: Tear down and start over, or convert?

Tear down and start over.

Song title that encapsulates your current mindset? 

“Tomorrow” from the musical “Annie.”