Key Highlights
Dwight Mortgage Trust provided a $183M construction loan for a 530-unit luxury community in Gilroy, CA.
It is the largest construction financing in Dwight's history.
The developer is Ten South Construction.
The loan funds new supply into a market where national starts have collapsed.
Non-bank credit is stepping into construction lending banks have stepped back from.
The Signal
Development capital is selective, not absent — it's chasing the supply gap.
Private credit is filling the bank-sized hole in construction lending.
The best new supply gets funded precisely because so little is being built.
Read alongside today's national print, this loan is the counter-move. Deliveries are falling below the decade norm — and a lender just wrote its largest-ever construction check to add 530 units in a supply-starved Northern California submarket.
That's not a contradiction; it's the strategy. When the pipeline empties everywhere, the projects that do get financed are betting on delivering into a tighter market two years out, when today's completions are absorbed and new competition is scarce.
The financing source is the second signal. This is a mortgage-REIT construction loan, not a bank line. Non-bank lenders are underwriting ground-up multifamily that regional banks have largely retreated from — a structural shift in who funds new housing.
Implications
Developers who can secure construction debt now are positioning to deliver into a 2027–28 supply trough — the best-timed part of this cycle. The scarcity of financing is itself a moat: fewer funded starts means less future competition. For lenders, ground-up multifamily is where private credit is taking share from banks, and pricing that risk is the opportunity.
Key Takeaway
With national supply collapsing, the developers who can still get financed are timing the next cycle's tightest window.
Source: CRE Daily · ~July 10, 2026
