Client-First Capital Advisory: Andrew Kwok - Arcus Harbor — Deal Flow Friday

In this episode of Deal Flow Friday, David Moghavem sits down with Andrew Kwok, Principal at Arcus Harbor Real Estate Capital, to dive deep into the rapidly evolving debt and equity landscape in commercial real estate. They explore why private credit is on fire, the regulatory pressures driving borrowers away from traditional banks, and how debt funds are competing for deals. Andrew shares valuable insights from his 20+ years in the industry, including lessons learned from launching Arcus Harbor and navigating capital markets post-COVID.

From structured finance to agency lending, Andrew and David break down how sponsors can smartly recapitalize, refinance, or acquire assets in today’s climate—where positive leverage is back and the devil is in the details. If you're trying to make sound capital decisions in 2025, this episode is packed with strategy, nuance, and perspective.

Chapters

00:00 – Introduction & Arcus Swag Talk
01:38 – The Arcus Team’s Deep History
03:03 – USC Real Estate Board & Market Thought Leadership
04:48 – Why Private Credit is Booming
07:18 – Operators Entering the Credit Game
09:18 – Shifting from Credit to Equity?
10:38 – Appetite Swings in Debt Fund Lending
12:08 – CLOs, Back Leverage & Loan Sales Explained
13:48 – How Bank Regulation Benefits Private Credit
17:08 – Why Arcus Rebranded & How It’s Structured
20:18 – Arcus Lending Products and Market Coverage
23:18 – A More Nimble, Client-First Approach
27:18 – Deal Volume: Agency vs. Alternatives
29:48 – Refinances, Maturities & Acquisition Trends
34:18 – Seller Capitulation & Buying Below Replacement Cost
36:48 – Positive Leverage is Back
38:28 – Syndicators: Old School vs. New Age
40:38 – Strategic Recapitalizations with Cash-In Refinances
43:18 – Insurance Market Dislocation & Recovery
45:18 – Advice for Sponsors Making Tough Decisions
47:48 – Why Term Sheets Aren’t Always What They Seem
49:18 – Deep Diligence and Underwriting is Back
51:48 – Term Sheet Minutiae: Strike Prices, Floors, and Caps
53:38 – Creative Cap Structures and Market Nuances
55:08 – Wrapping Up With Golf & Gratitude