FICC Focus Real Estate Private Credit With Madison’s Zegen: FICC Special
Aug 1, 2025
Josh Zegen, principal and co-founder of Madison Realty Capital, shares insights into the evolving realm of real estate private credit. He highlights the importance of flexible capital in filling the financing gap traditionally occupied by banks. The conversation dives into the affordability crisis in residential real estate and the trend towards single-family rentals. Zegen also discusses innovative strategies for repurposing office spaces into residential units and explores nontraditional investment sectors, shedding light on their unique risks and opportunities.
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US Housing Affordability Crisis
- The US faces a housing affordability crisis due to new housing targeting middle to higher incomes.
- Supply overhang in certain markets is easing as new starts slow and financing tightens post-March 23 banking crisis.
Build-to-Rent Impact on Housing
- Build-to-rent single-family housing shows very high occupancy and longer tenant stays compared to oversupplied Class A multifamily apartments.
- This trend has significantly helped housing supply and provided an exit for home builders post-GFC.
Office Sector Distress and Conversion
- The biggest distress is in B and C quality office buildings post-COVID due to work-from-home impacts.
- Prime AAA office buildings show strong leasing and absorption, aided by initiatives like NYC's office-to-residential conversion tax abatement.