In times of stress and uncertainty, vacillating and higher interest rates, and bad fortunes for certain property sectors, the private credit sector gains traction for its nimbleness and its ability to seize opportunities while extracting the highest perceived risk-to-reward profile.

How high in the capital stack do you want to go on an iffy office building? Pretty high, if double-digit returns are baked into the cake, and better-quality assets are making a comeback in the central business district in question. The borrowers need the money and don’t have a lot of places to get it.

Add that in the post-pandemic era, interest rates have risen from historic lows, as global central banks have tightened monetary policies to battle the inflation that followed the COVID-19 years of ameliorative and stimulus programs.

Such dynamics are unsettling for the institutional lenders and equity investors — the banks, thrifts, trusts, insurance companies and others — who in