Distress and Opportunity in Real Estate Today: Cash-In Refinancing, Rising Rates, and Smart Investing – Chris Litzler: Ep #537

Joining us today is Chris Litzler, Senior Managing Director at Marcus & Millichap, for an insider look at the current state of real estate capital markets. We dive into the world of refinancing and acquisition lending. With interest rates significantly higher than just a few years ago, most refinancing today is “involuntary,” driven by maturities or covenant breaches, and the need for borrowers to bring in fresh equity (cash-in) to right-size loans.

Chris explains what passive investors should be looking for in real estate deals—starting with strong sponsors, high-quality assets in resilient markets, and smart loan structures. There is potential for new developments in the market with the scarcity of new construction (especially in multifamily), and opportunity for those who can weather short-term financing risk with strong equity positions. We also touch on the growing role of private credit funds, their structure, and how shadow banking and leverage could introduce unseen risks in the market.

Minute Markers:

01:37 – Introducing Chris Litzler of Marcus & Millichap.
03:58 – How most refinancing is now about problem-solving, not strategic or opportunistic moves.
05:57 – “Cash-In” refinancing explained and why borrowers today often have to bring equity to the table.
07:00 – Loan maturity pressures and lender behavior.
11:14 – Borrower options when fresh capital is required.
12:49 – How higher-quality opportunities are emerging for well-capitalized buyers.
14:02 – Interest rates and the bond markets – predictability is key for investor confidence.
17:16 – Global uncertainty: tariffs, inflation, and a growth-slowing environment.
21:41 – How short-term loans are under pressure.
23:48 – The need for passive investors to look for experienced sponsors and high-quality assets.
28:14 – Why new real estate developments may still work in today’s market.
30:40 – Shadow Banking risks.
32:54 – Common mistakes passive investors make.
34:39 – Tradeoffs in private equity vs. private credit spaces with inflation.

If you like this episode, here are more episodes we think you’ll enjoy:

Ep #534 – Russ Morgan – Becoming a Better Investor: What to Pay Attention to and What to Ignore
Ep #532 – David McAlvany – Recession and Reindustrialization: Investing Wisely in a Time of Transformation
Ep #527 – Marcus Crigler – Real Estate Investing and Profit Retention For 2025

Featured on the Show:

#ChrisLitzler #RealEstateRefinancing #RealEstateOpportunities #PrivateCredit #ShadowBanking #Equity #Loans #PassiveInvestor

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Power Concepts:

“There’s kind of been a sentiment shift that interest rates aren’t going to come drop and save you. It’s time to meet the market and transact.” – Chris Litzler

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“The overarching theme is quality. Your manager is experienced, capable, strong. That’s the first way to de-risk any deal.” – Chris Litzler