Monday Market Moves | Week of January 13, 2026

Welcome to Monday Market Moves, the weekly series from Essex Capital Markets briefing you on Chicago commercial real estate capital markets. We cover key trends in CRE debt, refinancing, and capital structures to help investors and owners navigate today’s financing environment.

This Week: Multifamily Remains Chicago’s Most Financeable Asset

As capital markets move into 2026, lender behavior across asset classes remains selective. Office and retail continue to face elevated scrutiny, industrial underwriting has tightened in certain submarkets, and construction lending remains conservative. Against that backdrop, multifamily continues to stand out as the most consistently financeable asset class in Chicago.

While financing today requires more discipline than in prior cycles, multifamily assets with stable operations and realistic underwriting assumptions are still attracting strong lender interest across agencies, regional banks, and private capital sources.

Why Multifamily Continues to Lead

Several factors continue to support multifamily’s position at the top of lender preference lists.

• Durable demand fundamentals. Chicago’s multifamily market continues to benefit from steady renter demand, particularly in neighborhood submarkets with access to transit, employment centers, and amenities.

• Predictable cash flow. Compared to other asset classes, multifamily offers shorter lease terms and diversified income streams, which lenders view as lower risk in uncertain environments.

• Limited new supply in many submarkets. Constrained development pipelines have helped support occupancy and rent stability across large portions of the city.

These fundamentals give lenders confidence, even as underwriting standards remain conservative.

Lender Appetite Remains Broad

Multifamily is one of the few asset classes where multiple capital sources remain meaningfully engaged.

• Agency lenders continue to anchor the market for stabilized assets, offering long-term, non-recourse options with flexible structures.

• Regional banks remain active, particularly on smaller balance deals and relationship-driven executions.

• Private lenders and debt funds are filling gaps where leverage, timing, or asset profile falls outside traditional boxes.

The result is a deeper and more competitive lending environment for multifamily than for most other property types.

Chicago Signals: Execution Still Matters

While multifamily remains financeable, execution is not automatic.

• Loan proceeds are increasingly driven by in-place performance rather than pro forma assumptions.

• Cash flow and underwritten debt service coverage remain the key drivers for proceeds levels.

• Rising operating expenses, insurance costs, and conservative stress testing can materially affect sizing.

• Sponsors with organized financials, clear business plans, and realistic expectations continue to see the strongest outcomes.

Multifamily owners who approach financing proactively are finding that capital remains available, even if leverage levels are more measured and underwriting is somewhat conservative.

Bottom Line

As the market moves through 2026, multifamily continues to be Chicago’s most financeable asset class. Stable demand, predictable cash flow, and broad lender appetite are keeping capital flowing, even as underwriting remains disciplined. For owners and investors, success still hinges on preparation and execution, but the foundation for financing remains firmly in place.

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