While the build-for-rent sector has exploded over the course of the COVID-19 pandemic, there's one sector that's finding it tough to break in: middle-market investors.
According to a new report from Walker & Dunlop, debt in the space has become "a tale of two markets," as large institutions, family offices, and smaller private equity firms are pouring capital into construction. The same goes for mid-market funds and high net worth individuals.
But there's a catch: "Where we see a large gap emerging, is within the construction lending sector. Institutional sponsors aren't having any trouble securing debt; however, middle market investors are facing difficulty due to the lack of banks active in the space," says Keaton Merrell, managing director, Capital Markets at Walker & Dunlop.
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