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Dekel Capital has launched a new credit platform focused on supplying equity for acquisitions and refinances in the current tight debt market, Commercial Observer has learned.

The Los Angeles-based real estate investment firm’s new credit strategy is geared toward providing multifamily sponsors with mezzanine and preferred equity capital between $2 million and $10 million. Shlomi Ronen, Dekel’s founder and managing principal, said the offering is designed to help property owners in need of equity to finance their assets in a climate with stricter underwriting standards and higher operating costs.

As the old saying goes, “when life gives you lemons, make lemonade.” And of late it definitely feels like the CRE industry has received its fair share of lemons. The post pandemic slow return to office, the Fed’s historic increase of short-term rates, tight labor markets, and persistently high material costs have all created headwinds for CRE investors and developers. While forcing investors to pivot business plans in order to mitigate market risk,

Tightened lending standards and declining loan demand at large commercial banks are creating a path for nonbank entities such as Dekel Capital to establish lending platforms.

Dekel, based in Century City, has launched a correspondent lending platform that will operate on behalf of capital providers including a global asset manager and large European bank. The platform will be used to originate balance-sheet and commercial mortgage-backed securities loans for the acquisition,

While there’s comfort in comparing the present high interest rate environment to the economic crisis of 2008, CRE investors are having to work a lot harder in 2022 to get deals done, according to Dekel Capital’s founding principal.

Earlier this year, the Fed declared war on inflation that most recently hit 8%, using its blunt tool, the federal funds rate, to increase the cost of doing business across every sector of the economy,

It’s been quite an eventful stretch in the capital markets this past month as investors and lenders processed strong inflation reports and the Fed issued an equally strong response to slow the rate of inflation. The uncertainty about the future has led many to take a pause and revaluate what the future holds for commercial real estate, weighing the prospect of ongoing inflation or a hard economic landing into a recession.