Pat Crandall

What’s been the biggest highlight and biggest challenge of 2025 for your team thus far?

The biggest challenge has been the uncertainty in the marketplace, largely emanating from Washington, D.C.  It’s hard for developers and LP investors to have conviction around a large development project when tariffs are on and off and on again, combined with all the noise around geopolitical and interest rate uncertainty. I’d say the biggest highlight has been that, in spite of all of that uncertainty, our investment in relationships has resulted in our ability to finance some of the premier sponsors in the business, as well as being the leading construction lender in the purpose-built student housing space.

Which lending opportunities that didn’t exist last year are you grabbing today? 

Our niche in construction financing, so I don’t think there are any opportunities that didn’t exist last year given that focus. But we are securing business from best-in-class sponsors, particularly on larger loans, given we don’t require repayment guaranties, syndication, or deposits as many banks do.

As a nonbank, what’s your competitive advantage over banks today? 

In addition to the factors I mentioned above, we have a lot more flexibility than regulated banks to deal with the inevitable surprises inherent in development. We can also entertain borrower requests for modifications or accommodations that make business sense, but would be more challenging for regulated banks. This is partly why we have done so much repeat business with borrowers.

As a construction lender, what are you hearing in terms of developers’ willingness to commence new projects amid tariff upheaval? Has it altered your pipeline at all? 

I mentioned this previously, but this uncertainty has caused some developers to put projects on hold, or LP investors to back out of deals that might otherwise make sense.

Have the capital markets’ resiliency surprised you over the past few years? Discuss.

Absolutely.  Not only does the stock market continue to surge, with equity valuations that seem very aggressive, since we turned the page to 2025, the banks (both money center and regional) are fully back in the pool, providing liquidity to the market that simply wasn’t available in the last two years. Not only are they providing direct financing, they are also providing significant leverage to nonbank lenders, resulting in a race to the bottom on pricing.

What could be the industry’s next black swan?

There are so many areas of risk in the system currently. But I don’t think real estate credit has lost underwriting discipline (yet). 

I do think risk may be mis-priced currently, and that investors are betting on interest rates decreasing and increasing rents, and neither of those assumptions may come to fruition in the near term.  

What’s the one thing you wish you knew coming into 2025 that you know now?

That the banks would come back into the CRE lending space so aggressively!  

Lighting Round:

“The Summer I Turned Pretty” or “The Morning Show”?

Neither?  If not an option, “Morning Show.”

Biggest moment of 2025: Taylor Swift’s engagement or Fed rate cuts?

Neither?  If not an option, I’m going with rate cuts.

Data Centers: Been there done that, or Gimme more?

Gonna need more power for more data centers!

Where will rates be one year from now?

Lower.

Friend, unfriend, block: Office, retail, hospitality?

Block, friend, friend (all in certain markets).

How do you shake off market stress?

Play golf, which induces different stress.

NFL or college football?

College.

What song would be the theme tune of your life?

I’d have to say “Hey Jude” as that’s my middle name.

Thanksgiving: Are you the chef or spectator/taster?

Chef.

Holiday wish?

No more wars.