Within commercial real estate, capital is active, but highly discriminatory. We characterize the current environment as selective risk-on. The industrial sector continues to command attention. For example, the Plymouth Industrial REIT going private in a ~$2.1 billion deal signals private capital sees value in infill industrial assets with predictable cash flows.¹ Banking consolidation matters. The Huntington National Bank acquisition of Cadence Bank in a $7.1 billion all-stock transaction underscores scale and deposit priorities, not growth for growth’s sake.²

On the occupier side: Amazon's recent announcement of 14,000 corporate job cuts as it re-allocates capital into AI infrastructure (described by management as “the most transformative technology since the internet”)³ is more than tech-sector news. It could be a new shift in demand for real estate assets, potentially reallocating some office demand to data centers, though for not even a fraction of the space; and in some ways is slightly reminiscent of the e-commerce revolution when retail moved into warehouses.

This is underscored by an earlier article by the New York Times stating that Amazon expects AI and robotic automation will replace 600,000 Amazon jobs by 2033.12 Since the 1950’s, we have been warned that robots were coming for our jobs; however, now because of on-shoring, high labor costs, and AI, it’s really happening. Good real estate sponsors will have to continue to evolve to stay abreast of automation trends in order to remain competitive.

Given these signals, we remain very conservative and favor short-term loans that allow us to make small course adjustments on a more frequent basis to stay ahead of the larger trends. We still view this as the early phase of a hedged soft-landing cycle. Our strategy is highly selective deployment utilizing conservative underwriting of projects with resilient cash-flows. We continue to focus on experienced operators with proven track records. Cycles like this reward conviction and patience, as demand for bridge capital increases during times of great transition.

_{1 - Plymouth Industrial REIT Announces Agreement to Be Acquired by Makarora for $2.1 Billion. GlobeNewsWire.  
2 - Huntington Bancshares buying Cadence Bank. AP News.
3 - Amazon is cutting 14,000 corporate jobs. The Verge. 12 - Karen Weise, “Amazon Plans to Replace More Than Half a Million Jobs With Robots,” The New York Times, October 21, 2025.}

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