Loans will be made or arranged pursuant to California Financing Law.
Rubicon Mortgage Fund, LLC. CFL 6053884
Rubicon Realty Advisors, Inc. CFL 6053885. NMLS ID: 2257291
For most of the last century, if you needed a loan to buy, build, or refinance a commercial property in the United States, you went to a bank. That’s changed. Over the past two decades, and especially since the 2008 financial crisis, private lenders have taken on a much bigger role in financing commercial real estate. Rubicon Mortgage Fund, LLC has been part of that shift since 2008, so we wanted to lay out what’s actually driving it, and what the research says about why it matters.
Private credit isn’t a new idea, but its growth has accelerated. According to Franklin Templeton Institute, banks’ share of private lending in the U.S. economy has fallen from 60% in 1970 to 35% in recent years (Davidow & Thakur, 2026). That’s a long, steady retreat, not a sudden event, and commercial real estate lending has followed the same pattern.
The retreat sped up after the 2008 crisis, and again more recently. Following the collapse of Silicon Valley Bank in 2023, banks have grown more cautious about lending to small and middle-market borrowers, focusing instead on larger corporate clients (Davidow & Thakur, 2026). For property owners who don’t fit neatly into a big bank’s underwriting box, that’s left a real gap. Private lenders, including asset-based and commercial real estate debt funds, have stepped in to fill it.
There’s a reason this split exists, and it’s not just about who has capital available. A study published in the Review of Financial Studies modeled the commercial real estate debt market as split between two types of creditors: banks, and arm’s-length investors who buy securitized loans (Black, Krainer, & Nichols, 2020). The researchers found that safer, more stable properties tend to get funded through securitization, while properties more likely to need renegotiation or workout support get funded by banks, because banks are better equipped to manage a loan through distress (Black et al., 2020).
Private lenders occupy a related but distinct space in this picture. They step in on deals where speed, flexibility, or a nontraditional property type make a conventional bank loan difficult, filling gaps that neither big banks nor the securitized bond market are set up to serve efficiently.
One of the more useful things researchers have studied is how commercial real estate actually performed through recent crises, and what that says about the health of the broader system. A 2023 IMF working paper analyzed over a million CRE transactions from 1994 to 2020 and found that liquidity, not just prices, is what absorbs the shock during a downturn (Alter, Badarinza, & Mahoney, 2023). Transaction volumes drop sharply during a crisis, prices adjust, and then activity rebounds once conditions stabilize.
Their data also showed that a one standard deviation tightening in financial conditions is associated with roughly a 2.5% to 3% drop in commercial real estate prices in the following quarter, with the effect strongest in the retail sector (Alter et al., 2023).
That resilience matters for private lenders specifically. When bank capital tightens, as it has, borrowers still need financing to refinance maturing loans, complete renovations, or close acquisitions on a timeline that works. Private credit has increasingly been the source of that financing.
None of this is abstract for the people actually trying to get a deal done. A borrower with a good property and a tight timeline, who doesn’t fit a bank’s current risk appetite, has more legitimate financing options today than they did ten years ago. That’s the practical result of everything above: private lenders built a track record, the research backs up why the split between bank and non-bank financing makes economic sense, and the data shows the broader market held up better than a lot of people expected.
At Rubicon, we’ve been part of that shift since 2008, providing direct, asset-based bridge financing across California when a deal needs to move faster or look different than a traditional bank loan allows.
Alter, A., Badarinza, C., & Mahoney, E. (2023). Commercial real estate in crisis: Evidence from transaction-level data (IMF Working Paper No. WP/23/15). International Monetary Fund.
Black, L. K., Krainer, J. R., & Nichols, J. B. (2020). Safe collateral, arm’s-length credit: Evidence from the commercial real estate market. The Review of Financial Studies, 33(11), 5173–5211.
Davidow, T., & Thakur, P. (2026, April). The evolution of private credit. Franklin Templeton Institute. https://www.franklintempleton.com/articles/2026/alternatives/the-evolution-of-private-credit
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According to the Franklin Templeton Institute, banks’ share of private lending in the U.S. economy has fallen from 60% in 1970 to 35% in recent years (Davidow & Thakur, 2026). It has been a long, steady retreat rather than a sudden event, and commercial real estate lending has followed the same pattern. The pace picked up after the 2008 financial crisis, and again more recently.
According to the Franklin Templeton Institute, banks’ share of private lending in the U.S. economy has fallen from 60% in 1970 to 35% in recent years (Davidow & Thakur, 2026). It has been a long, steady retreat rather than a sudden event, and commercial real estate lending has followed the same pattern. The pace picked up after the 2008 financial crisis, and again more recently.
