2024: A Golden Opportunity for Alternative CRE Lenders to Communicate Their Value

By Greg Michaels

As we shake off last year’s capital markets hangover and look ahead to what the rest of 2024 has in store for the commercial real estate (CRE) industry, the largest U.S. banks as well as many regional banks remain retrenched, which is severely constraining liquidity. Amidst the continuing uncertain environment, which over the past year-plus has involved rapidly rising interest rates and a dearth of financing availability, many companies in the industry—lenders and otherwise—are still experiencing an absence of fresh transactions. Moreover, questions linger surrounding the office market, the potential for a recession and international macroeconomic events, making 2024 as unpredictable as any year on record.

Golden opportunities for alternative lenders

That said, there is optimism that a pricing reset will take place later this year, which should result in increased deal flow. The capital void left by banks has created a golden opportunity for alternative lenders. These debt platforms have stepped in to fill the gap, serving as a reliable source of capital for market participants and taking advantage of the opening that has presented itself in today’s market environment.

All of these alternative lenders want access to attractive financing opportunities, which are much harder to find today. Due to the volume of deals that have historically come across their desks, many of these firms have never had to prioritize marketing and public relations to support their businesses. However, due to increased competition for a smaller number of viable loans, non-bank lenders must consider how their communication strategies are supporting origination activities. Failure to do so can have an adverse effect on their ability to effectively deploy and raise capital, hindering overall growth. The need for targeted, proactive communication is equally as important for newer market participants hoping to take advantage of the dislocation. If the market doesn’t know these firms exist or appreciate their capital solutions, they are putting themselves at a severe disadvantage.

Sophisticated communications strategies are critical in 2024

In 2024, it is more important than ever for alternative lenders, intermediaries and other real estate firms looking to remain competitive to leverage sophisticated communications strategies to craft messaging and get their corporate narratives into the public domain. Being visible, proactively sharing market insights and highlighting successful transactions can help drive deal flow, clarify market misconceptions and capture share-of-voice — all of which support reputation building.

By working with corporate communications and public relations professionals, alternative lenders position themselves to have a leg up in a highly competitive market. Important tactics these firms should understand and utilize – in no particular order – include:

  • Employing micro-strategies to promote select originations and corporate news
  • Increasing the quality of corporate messaging
  • Leveraging exclusives and embargoes, as warranted
  • Participating in industry trend stories
  • Securing long-form profiles and Q&As
  • Putting macroeconomic data into perspective
  • Developing thought leadership content
  • Speaking on industry panels
  • Building reporter relationships

While many firms believe that public relations is only important when deals are getting done and there are transactions to promote, nothing could be further from the truth. In between the relevant business announcements such as closed transactions, the opening of a new office, etc., alternative lenders should utilize corporate communications to proactively contextualize and drive the narrative related to a challenging market environment, in addition to telling their story and showcasing the firm’s brightest stars as they do what they do best: getting deals financed and sharing salient and compelling market insights. In doing both, executives have the opportunity to become invaluable sources of smart commentary for key reporters, cementing their places as thought leaders in the industry and creating strong visibility to support deal flow.

As alternative lenders continue to fulfill an important need in the CRE market, they must consider the implications of operating without proper public relations representation, which could result in lost opportunities.

ICR’s PR teams can help you stand out in a competitive market with a strategic communications strategy for this year. Get in touch.