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Banks provide leverage behind private credit boom in commercial real estate

Private credit loans totaled about $1.4T, roughly 10% of U.S. nonfinancial corporate debt, in the second half of 2025, with bank credit commitments to other financial entities rising to $2.6T by year end.

Reported · Written up by our desk · Commercial

Private credit has rapidly expanded into commercial real estate lending as traditional banks shift away from direct lending, but still support the market through back-leverage structures, according to an investigation by Bisnow.

Bisnow cites Federal Reserve data showing that in the second half of 2025, private credit loans were about $1.4T, or 10%, of total debt for U.S. nonfinancial corporations. The report also notes that private credit entities nearly doubled their debt holdings from 2021, when they held $770B.

The article says banks credit commitments to other financial entities grew to $2.6T by the end of last year, up from $1.2T in 2018. It describes how the financing web can be hard to trace, because the leverage provider may not appear on borrower loan documents or in property-level records.

Bisnow adds that its Atrium Data-backed database mapped the relationships using Uniform Commercial Code filings, linking partnerships and collateral assignments for properties, primarily in New York City. The piece also says the five largest U.S. banks dominate the space, with Goldman Sachs having the largest scope, though it does not provide further deal specifics due to nondisclosure limits.

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