ICSC Las Vegas – Recap From a Bridge Lending Lens

Last week I had the privilege of attending ICSC Las Vegas.  Seemed like a normal trip but two days before leaving I was sent my 25th anniversary ICSC pin.   

To me, it was a bit of a surreal moment.  On the one hand I was thankful for the recognition and appreciation and on the other hand I could not believe that for 25 years retail has been such an integral part of what we do.  Retail has historically and continues to be a consistent product that we originate and source/provide capital for. Retail has indeed consistently shown the ability to adapt to different economic and social hurdles over the past 25 years.  Either way, retail is a big part of our brand, and it is always a pleasure to attend and experience Las Vegas ICSC. While at the same time, we continue to serve as a generalist across all asset types, boding well for opportunities in different debt fund borrowing sectors.   

I have provided some key overall takeaways in a separate Slatt weekly communication – here’s a curated version of this list focused on a bridge lending point of view. 

Key Takeaways 

• Bridge and interim financing remain plentiful across the retail sector from debt funds, banks, and life company lenders. 

• Retail continues to outperform other sectors as construction and delivery of new inventory remains at low levels resulting in high occupancy levels and higher rents. 

• Demand for in-line national and regional tenants continues.  Rents across the country for in-line retail strip centers or shadow-anchored strip centers continue to hold and show there is continued demand for these tenants to grow.  There is a major focus on Sun Belt and Southern U.S. markets where there is high population growth.   

• Cost of capital in the higher leverage build-to-suit space continues to compress as more lenders come into the space.  Higher LTC debt fund lenders who have historically had the space to themselves are seeing competition from traditional national, community and local commercial banks. 

• Borrowers are all looking for shorter-term solutions from debt funds as many borrowers look to acquire these funds in the hope that rates come back in over the next 12-18 months.   

• An additional highlight at ICSC this year was the introduction of Women’s Day programming. Attendees spoke highly of the event, and many indicated they would participate again if the program was offered in future years. 

• General feel for attendance was strong, but as with many large format conferences there are increasingly more off-site meetings or events. Conference leadership needs to find a way to keep costs of the event down while encouraging industry folks to attend the actual event on site.   

This year’s ICSC Las Vegas reinforced retails resilience and continued importance in the capital markets. Would enjoy hearing your point of view if you attended this year. Let’s connect!