What is Middle Market CRE?
What is middle market cre I have seen it on a few lender websites. Hoping someone can explain.
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I am at a middle market IS shop and we focus on deals in the 5-30 million range.
whatever the speaker/writer wants it to mean in that particular moment/context.
however, i would agree w 'intern in re' above.
also probably depends on product type and location if you wanna get really picky. "middle market office asset in NYC" probably means a different dollar amount from "middle market retail in kansas"
Middle market usually means not doing mom & pop deals (less than $2MM) and not doing institutional deals either (~$50MM+)
Our firm has two funds that focus in the middle market and that range is $7.5MM - $50MM
This is close to how I would define (and yeah it is totally defined as someone chooses), I would probably go with a $5 million to $50 million range, but same concept. Not "regular mom & pops" and not "super institutional", but a lot HNW, small funds, local operators, syndicators, and some smaller institutional deals.
Interestingly, this segment can be very profitable as margins can be larger, fees higher, etc. as it is just more fractured and disorganized than the large institutional market.
I work in the middle market space and it is certainly less competitive, although on the margins you are competing with HNW capital and large institutional players, both of whom are really difficult to compete with from a cost of capital perspective. I will say though that it's a grind and at times feels like a pure volume/diversification play. If your fund is $500-700M, you're likely doing 70-100 deals over the four-year investment window.
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