Women CRE Leaders Say Capital Deployments Could Make A Lot Of Noise In DFW Next Year

After nearly two years of relative silence from core capital funds, their voices could get very loud in 2025.

And that capital is targeting assets that fall outside the usual apartment, office and industrial buildings, according to some of DFW's most prominent women in commercial real estate.

Twenty-four top women in finance were honored Tuesday at Bisnow's Dallas Women Leading Real Estate event at The Renaissance in Dallas.

Finance was also the topic of the day for panelists, who discussed what is driving deals, what properties are hot and where the money is coming from.

JLL Managing Director of Capital Markets Teddy Leatherman has seen a pivot to alternatives, with core funds looking to diversify.

“There's plenty of dry powder on the sidelines,” Leatherman said. “There's $254B of equity that's been raised that needs to be deployed into commercial real estate.”

Instead of investing in just traditional asset classes, those core funds are increasingly interested in alternatives ranging from student housing to single-family rentals and mobile home parks, she said.

JPI Managing Director of Capital Markets Adrienne Bain said she is also seeing more interest in alternative product types from lenders and allocators of capital. 

“They're looking at affordable … is a good way of putting it, both ‘big A’ and ‘little a,’” Bain said. “Sixty percent of my pipeline has some component of affordable next year. We're developing across the income spectrum, but also looking at different product types like [build-to-rent].”

The capital available is also diversifying. Matthews Southwest Vice President of Capital Markets and Partner Relations Audrey Schmeltz said her firm has seen more financing opportunities in the debt fund space. 

Others are seeing capital inflows from overseas.

While equity from the Middle East and Asia has been prevalent historically, hedging costs have made it hard for those interests to get money into the U.S., Leatherman said. But she expects to see equity coming from the UK, Canada and Australia in 2025.

“You'll see a big push from a lot of Canadians, specifically in … student housing in 2025,” she said.

Activity among capital providers has an ebb and flow depending on what is going on from a macro perspective, Bain said. JPI is doing deals with a variety of capital providers, including REITs, traditional senior debt lenders and debt funds.

“When traditional bank debt is inexpensive and plentiful, the debt funds are a little less active,” Bain said. “When it's more expensive and a little harder to access, then the debt funds are more active.”

That's good news, with more opportunities cropping up, panelists said.

On the multifamily side, RREAF Residential CEO Melanie French said she is starting to see more real estate-owned properties and properties heading toward foreclosure because they aren't covering debt. She expects to see a significant chunk of that going into assets that couldn’t make it through the last three years.

“Right now, I'm talking with four different owners about taking on properties to manage that have been foreclosed on,” French said. “That is a much larger number than in the last 12 to 18 months.”

When forging strong relationships with capital sources, Schmeltz said she has had success getting things to the finish line by being transparent about risks and deadlines. Open communication is vital to success, especially in difficult markets, Leatherman said. 

“In terms of leading a team, it's really important to have a positive outlook, especially in tough times,” Leatherman said. “Someone once told me, ‘Positive people get deals done. Negative people just sound smart.’ That's really true. If you're all pushing in the same direction, you're going to get the deal done one way or another.”

French said there are three things that are critical to anyone looking to climb the corporate ladder. 

“That's what I call TCR: trust, credibility and rapport,” French said. “It starts with that, because at the end of the day, it is a business of relationships [and] a business of influence.”