Arbor Private Construction Builds Momentum as Market Activity Rises

Key Points

• Arbor Private Construction (APC) is experiencing strong nationwide demand as developers accelerate multifamily projects through late 2025.

• Recent survey data shows financing and payment delays have stalled some U.S. construction activity, creating an opening for private lenders.

• APC has recently closed major construction loans in Surfside, FL; Bayonne, NJ; and Plymouth Meeting, PA, for both ground-up and conversion projects.

• Arbor EVP David Friedman says confidence is returning as equity becomes more comfortable deploying capital and lenders re-enter the construction market.

Arbor Private Construction (APC) is seeing a sharp rise in demand as developers look for financing partners who can carry projects from shovel-ready to permanent agency execution. Launched in late 2023, the APC program has quickly become a preferred option for experienced sponsors navigating a market where construction financing remains available but selective.

This surge is happening as traditional financing sources show strain. An October 2025 survey of 400 construction professionals reported that late payments and financing gaps contributed to delays in 42 percent of projects, adding a hidden 14 percent tax on total costs industry-wide. Private developments placed on hold are up 35 percent year over year. In this climate, lenders with consistent capital and long-term views are shaping the next wave of multifamily supply.

Why Investors and Developers Are Turning to APC

David Friedman, Arbor’s Executive Vice President and Chief Credit Officer and Head of APC, said the biggest hurdle in the past two years was not construction cost volatility, but finalizing equity.

“Over the last 18 to 24 months, when it came to getting projects off the ground, we found that finalizing the equity contribution was often the biggest holdup,” Friedman said. “Six months removed from Liberation Day, developers and contractors have a better understanding of tariff impact to budget, and we are now in an environment where rates are expected to ease further into 2026. Equity is more comfortable moving off the sidelines.”

Friedman added that the key to navigating tariffs is focusing on trades and budgets up front. Labor remains an unknown, but he said experienced lenders can manage that risk.

These dynamics are paving the way for construction financing to pick up speed through the end of 2025 and into 2026.

APC Builds Partnerships with Strong Sponsors

Arbor built APC using its deep experience in build-to-rent and agency lending. The goal is to serve as a long-term capital partner for experienced sponsors. “Offering floating-rate construction lending does not mean we are a short-term lender,” Friedman said. “We want to partner with equity sponsors who plan to hold an asset long term. We stay involved from the first shovel in the ground through an agency execution.”

The product applies to mid-rise vertical multifamily projects in primary and strong secondary markets with positive demographic and employment trends.

Recent APC Deals Across Major Markets

• Surfside, FL: Arbor closed a $115 million construction loan for a mid-rise, 68-unit luxury development in Surfside. The project includes wellness-focused amenities such as a spa, private theater, fitness center and library with work pods. Friedman described the deal as the “quintessential APC project,” given the sponsor’s track record, the affluent submarket and strong rental demand. Construction is underway and targeted for completion in late 2026.
• Bayonne, NJ: APC recently financed a $58 million loan for a 197-unit project in Bayonne, an emerging commuter market outside New York City. The development will feature a rooftop deck, outdoor pool, ground-floor retail and modern finishes. Delivery is expected in 2026.
• Plymouth Meeting, PA: Arbor provided a $42 million loan for a 149-unit office-to-residential conversion near Philadelphia. Large floor plates, thoughtful layout, and experienced operators made this an ideal APC conversion candidate. The first phase is set to be completed in early 2026.

Why the Market Is Moving Again

Friedman said that the regional banking crisis of early 2023 triggered one of the most challenging lending environments in years. Banks tightened underwriting and pulled back on construction loans. That gap allowed private lenders with long-term confidence in multifamily to gain ground.

Now, more than 32 months later, lenders are easing back in, and competition is returning.

“Banks are looking to bring revenue back and construction is one way to do that,” Friedman said. “This has created healthy competition in the market, and borrowers are benefiting from it.”

Developers looking at conversions are also driving new activity. With the office market facing structural challenges, many owners are exploring office-to-residential transformations. For Arbor, underwriting these deals goes far beyond construction mechanics.

“It is not just about swinging a hammer,” Friedman said. “The question is whether the sponsor can place a converted building competitively in the rental submarket it will compete in. Unit mix, layout, natural air and light, amenities. All of those details matter.” 

 

Partnering with Arbor

Friedman said the APC program is gaining momentum at the right moment. “I am very optimistic about construction lending and the growth of our platform,” he said. 

APC, available through Arbor Realty Trust, is an active construction lending platform designed for experienced sponsors who seek a consistent, reliable financing partner with national reach. To learn more, contact Arbor today.