Good morning. It is Tuesday, June 23rd, and this is Debt Desk.

We will start with the national picture before we turn to commercial real estate debt, multifamily finance, and the rate backdrop shaping execution this morning.

The national story with the clearest market relevance is the one we have been tracking around Iran. The latest Associated Press reporting says Vice President JD Vance described the Switzerland talks with senior Iranian officials as a good foundation for a final deal, with technical teams still working after the top-level meetings wrapped. That matters because this is no longer just a foreign-policy headline. It is a rates, energy, and risk-sentiment story. As long as the talks keep moving, oil can keep backing off the panic highs and the market can trade with at least some confidence that the Strait of Hormuz stays open. If the diplomacy slips, that pressure can come back very quickly through crude, inflation expectations, and the long end of the Treasury curve.

Another major story this morning is a federal judge blocking the government from using the SAVE database to verify citizenship in voter roll checks. The AP reports the court said the program could wrongly purge eligible voters and violated privacy protections after the system had already been used to scan tens of millions of registrations. This has the makings of a fast-moving legal and political fight because it sits at the intersection of election administration, immigration politics, and federal data-sharing authority. Expect appeals, more state-level reaction, and louder rhetoric very quickly.

There is also another judicial setback for the administration on immigration enforcement. AP reports a federal judge halted an effort to subpoena Minnesota Governor Tim Walz and other officials, saying the move appeared retaliatory and had weak or nonexistent ties to a legitimate criminal investigation. On its own, that is a state-federal power story. In the broader context, it adds to the running theme of courts placing limits on how aggressively the administration can use federal tools in immigration disputes with states and localities.

And then there is the weather story, which looks increasingly like an economic story as well. AP reported Monday that extreme heat, wind, and drought conditions are fueling wildfires in Utah and Arizona, including a fast-moving fire that forced the evacuation of Eureka, Utah. The reason to keep that on the radar is not just public safety, though that is first. It is also a reminder that climate-linked operating risk keeps moving from abstract discussion into underwriting reality. Heat, smoke, wildfire exposure, insurance costs, power strain, and resiliency capital needs are now direct credit considerations across property types.

So the national setup this morning is fairly clear. The market is still trading the possibility of a more durable Iran deal. The administration is facing fresh court constraints in both elections and immigration. And the climate and wildfire story continues to bleed into the way investors and lenders think about long-duration risk.

Now let’s move into the Debt Desk section.

The cleanest place to begin is the rate backdrop. The latest official Treasury par yield curve from the U.S. Treasury is dated Monday, June 22nd. It shows the 2-year at 4.24 percent, the 5-year at 4.29 percent, the 10-year at 4.51 percent, and the 30-year at 4.95 percent. That is meaningfully higher than the June 18th curve we were using yesterday, when those same points were 4.19, 4.23, 4.46, and 4.90. The latest official SOFR print from the New York Fed is still 3.62 percent for June 18th, with publication lagging the holiday and weekend calendar, after 3.63 percent on June 17th.

That move in the Treasury curve matters because it tightens the execution window even without a dramatic change in credit spreads. The front end is still expensive enough to make floating-rate carry uncomfortable for sponsors who need time. The belly of the curve has moved back up as well, which means five-year and seven-year permanent money is not getting any easier on an all-in coupon basis. And the long bond back near 4.95 tells you duration still needs to be paid for. In plain English, this is a steadier market than the really volatile stretches we have seen, but it is not a cheap one.

For borrowers, that means the base-rate story is still a problem before spread even enters the conversation. A lot of sponsors can live with a credit spread if the lender will give them proceeds, time, and flexibility. They struggle when the Treasury component and the sizing assumptions both move against them at once. That is the environment this morning.

On spreads and lender tone, the market still looks selective rather than shut. Banks are showing up where they know the sponsorship and like the deposit relationship, especially on better multifamily and select industrial, but proceeds remain disciplined and structure still matters. Life companies continue to look competitive on very clean, lower-leverage, stabilized product, especially where they can write long-duration fixed-rate money against durable cash flow. CMBS remains available, but only with conservative leverage and a much less forgiving view of weaker office and transitional stories. Debt funds are still the group most willing to solve complexity, lease-up, construction, and hybrid capital-stack problems, which is why they continue to hold share even as other lenders edge back in.

One reason CMBS is still not a broad-based relief valve is the stress data that came out today. Commercial Observer, citing CRED iQ, reported that the overall CMBS distress rate rose to 11.86 percent in May from 11.08 percent in April. Special servicing moved up to 11.25 percent from 10.84 percent, and delinquency rose to 9.53 percent from 8.95 percent. Those are not crisis headlines in the sense of a frozen new-issue market, but they are a reminder that a lot of legacy trouble is still sitting in the system. So yes, conduit execution is open, but it is open in a market that still has a heavy workout pipeline behind it.

That split between fresh capital and old pain is probably the best way to describe CRE debt right now. Capital is available, but only for stories lenders can defend.

The fresh deal flow this morning reinforces that point. Commercial Observer reported today that X-Caliber Rural Capital provided a $185.6 million senior loan and CastleGreen Finance added $245.3 million of C-PACE financing for the redevelopment of the long-shuttered Coco Palms Resort in Kauai. That is a $431 million package, and it tells you a lot about where alternative capital is willing to go. Complex redevelopment, specialized sponsorship, and structured capital stacks still fit best with lenders that can blend senior debt and programmatic capital rather than rely on plain-vanilla balance-sheet execution.

We also got a clean bank construction print in multifamily-adjacent development. Commercial Observer reported today that Helaba supplied a $111.5 million construction loan to StreetLights Residential and Pritzker Realty Group for a new apartment project at the former JCPenney headquarters campus in Plano, Texas. That is exactly the kind of transaction that helps frame the bank conversation correctly. Banks are not back for everything. They are back for specific sponsors, specific markets, and business plans that still look financeable even with a higher coupon.

Adaptive reuse still deserves attention as well because it remains one of the few office-related lanes where conviction exists. Yesterday we were talking about the Madison Realty Capital financing at 1740 Broadway. That theme still holds. When lenders can underwrite the office story as a housing or hospitality conversion with a credible sponsor and a believable capital plan, money is available. When they cannot, the market remains extremely thin.

For multifamily, the tone remains firmer than the broader CRE market, but it is not easy money. Deal flow is active because housing still offers the deepest lender bench and the clearest exit paths. Yield PRO reported new refinance activity in the last day, including IPA Capital Markets arranging a $123 million refinance for a luxury multifamily property in Burlingame, California, and Berkadia arranging a $124.65 million refinance of a mixed-use multifamily community in the Dallas-Fort Worth metroplex. Those are not flashy rescue stories. They are examples of what is financing right now: established assets, recognizable sponsors, and business plans that can survive today’s debt-service math.

Multifamily construction remains more nuanced. There is capital for new deals, but it is not broadly interchangeable capital. Bank construction lenders are still highly selective, agencies are naturally not the answer for every phase of the business plan, and debt funds continue to win where lease-up risk, timing, or structure gets complicated. That means sponsors still have to work harder on capital stacking even in the strongest property type.

Agency activity is still one of the reasons multifamily feels more liquid than the rest of CRE. Freddie Mac’s multifamily issuance calendar shows a new K-Deal priced for June 22nd, K-7671, with roughly $965 million of seven-year conventional fixed-rate collateral. That matters because it is a visible reminder that the agency securitization machine is still moving even while private-label CMBS is carrying a heavier distress story. For stabilized apartment borrowers, agency execution remains one of the few channels that can still offer depth, consistency, and a credible takeout path.

Fannie and Freddie still matter here for a second reason too: they keep anchoring pricing expectation...