Good morning. It is Thursday, June 25th, and this is Debt Desk.

Before we get into commercial real estate and multifamily debt, here is the broader morning brief.

The national backdrop this morning is still being shaped by courts, energy policy and another round of political stress inside Washington. One of the clearest fresh rulings came Wednesday, when the Associated Press reported that a federal judge permanently blocked most of the administration’s executive order on elections, including the push to require documentary proof of citizenship when people register to vote. The practical read is that election administration is staying with the states and Congress unless higher courts say otherwise, and that keeps another major administration initiative tied up in litigation right as the political calendar gets louder.

Washington also spent the day dealing with the fallout from the Iran fight. AP reported late Wednesday that Senate Republicans, after being berated by President Trump at the Capitol, held another vote on war powers and defeated a second effort to restrain the administration’s military posture. That matters beyond foreign policy because it tells you Congress is still spending time and political capital on national security arguments that compete directly with domestic economic and affordability messaging. When Washington’s bandwidth gets pulled in two directions at once, markets usually assume policy execution gets messier, not cleaner.

A third headline worth watching comes out of New York. AP reported Wednesday that Frank Carone, the former chief of staff to ex-New York Mayor Eric Adams, was arrested in a federal bribery case tied to a migrant shelter contract. It is another reminder that the migrant shelter story is no longer just a budget and humanitarian issue. It is also a procurement and governance story, and that matters for state and local issuers, service providers and anyone watching municipal operating pressure in large cities.

Then there is the energy file, which is getting more complicated rather than less. AP reported that California intends to sue the administration over a deal that would unwind a major offshore wind project, while the administration separately announced $17.5 billion in loans for 10 new large nuclear reactors. The big picture is not simply that one energy source wins and another loses. It is that the U.S. power buildout is getting more politically directional, more capital intensive and more uneven by region. That has obvious implications for data center demand, industrial development and long-duration infrastructure underwriting.

So the morning brief is this: the legal system is still redrawing the limits of executive power in real time, Capitol Hill is still burning attention on security fights, and infrastructure capital is being pushed toward a more selective map. None of that directly prices a multifamily loan this morning, but all of it shapes risk appetite, business confidence and regional growth assumptions.

Now let’s move into Debt Desk.

The first thing to know today is that the rates backdrop improved at the long end. The latest official Treasury curve from June 24 shows the 2-year at 4.11 percent, the 5-year at 4.17 percent, the 10-year at 4.41 percent and the 30-year at 4.86 percent. The latest official SOFR print available at run time is 3.62 percent for June 23. That combination matters. The front end is still restrictive enough to keep floating debt expensive, but the move lower in the 10-year and 30-year gives permanent lenders and term borrowers a little more room than they had at the start of the week.

The shape of that curve is doing real work. With the 2-year only modestly below the 5-year, and the 30-year still well above the 10-year, borrowers are not just dealing with an absolute rate problem. They are dealing with a term-structure problem. Short-duration bridge debt still carries enough cost that it needs a very clear use case, while longer-duration fixed-rate executions still have to overcome a 30-year benchmark that remains close enough to 5 percent to keep coupons elevated. In plain English, the market is open, but the math still has to be earned.

You can see that in the deal tape. Commercial Observer reported today that Apollo, Affinius Capital and RXR put together $785 million of debt and equity for 175 Third Street at Gowanus Wharf in Brooklyn, a project expected to deliver 1,100 housing units plus an 85,000-square-foot Life Time fitness center. That is not a marginal signal. That is a large, complex capital stack getting assembled in a market where nobody is pretending capital is easy. It tells you well-positioned sponsors can still raise serious money for scale projects when the location, program and sponsorship line up.

The debt fund lane is still very much alive where the business plan is transitional or execution-heavy. Commercial Observer’s June 23 report on S3 Capital’s $102 million loan for the Press Building office-to-residential conversion in Hell’s Kitchen is still relevant this morning because it reinforces the same point we have been seeing for weeks: conversions remain one of the clearest places where debt funds can price complexity faster than the traditional market. If you need flexibility, lease-up tolerance or comfort with adaptive reuse risk, that lane is still being led by nonbank lenders.

Banks, meanwhile, are lending, but they are choosing their spots. Commercial Observer reported June 22 that Helaba provided about $112 million for the redevelopment of the former JCPenney headquarters campus in Plano into apartments. That was already a useful sign that select banks will still back multifamily development for proven sponsors. Today it reads even more clearly against the softer Treasury backdrop: relationship banks are not reopening the floodgates, but they will still fund high-conviction construction with a legible exit.

The same selective tone shows up in multifamily refinancing. Commercial Observer reported today that Mesa West Capital provided $82.5 million to refinance Olin Fields, a 352-unit apartment community outside Seattle, with a five-year nonrecourse loan. That is an important print because it shows lenders are still willing to support assets that have already gone through operational work and now need durable refinance proceeds, not rescue capital. In this market, a clean refinance is its own form of confidence signal.

There is also fresh evidence that affordable and public-private execution remains active. Commercial Observer reported Wednesday that Capital One closed a $96.2 million letter of credit to support the Edgemere Commons B2 affordable housing project in Far Rockaway. That is a reminder that capital formation is still available for housing with municipal and policy support, even while purely market-rate executions remain more rate-sensitive.

On HUD and FHA, the strongest fresh item this morning is a closing rather than a policy bulletin. Commercial Observer reported Wednesday that Dwight Capital refinanced a newly built multifamily development in Oregon City with $39 million of HUD-backed debt. That matters because the HUD lane still offers something many borrowers want right now: longer-duration proceeds tied to a government credit framework rather than a risk-on securitization market. It does not move fast enough for every deal, but when a borrower can wait for it, HUD still solves a real problem.

Agency liquidity also remains an anchor. Freddie Mac’s latest multifamily issuance calendar, published June 18, shows K-7671 on the week of June 22 with a projected issuance size of about $965 million for a seven-year conventional fixed-rate deal. Fannie Mae on June 17 said bulk-delivery multifamily MBS are now eligible for resecuritization, extending another liquidity tool inside the agency channel. That is not flashy on air, but it matters in the market because it improves capital flexibility around stabilized apartment paper. The big takeaway is unchanged: if you have clean, agency-eligible multifamily, the GSEs still set the execution standard everyone else has to beat.

That agency advantage is especially important because borrowers are still trying to solve for proceeds, not just coupon. A small move lower in Treasurys helps, but a lot of refinance conversations still come down to who can deliver leverage without forcing a painful equity check. That is why agency executions keep winning attention whenever the asset is stabilized enough to fit the box. In a market like this, reliability and certainty of proceeds can be just as valuable as headline spread.

CMBS remains open, but it is still carrying a split message. The fresh headline is not a new conduit triumph. It is stress inside the legacy book. Commercial Observer reported Wednesday that a D.C. Department of Veterans Affairs office loan entered special servicing. That is a deal-specific reminder that office trouble has not gone away just because new loans are printing elsewhere. On the broader market data, the latest Trepp monthly report, published June 1, showed the CMBS delinquency rate up one basis point in May to 7.55 percent, while Trepp’s June 10 special servicing update showed the overall special servicing rate down to 10.86 percent. Put together, that says the CMBS market is still functioning, but it is functioning with a workout overhang.

That matters for execution tone. Banks are still being selective and relationship-driven. Debt funds still own the more complex bridge, conversion and late-stage business-plan trades. CMBS is available, but legacy pain keeps underwriting disciplined. Life company appetite, by inference from the current deal mix rather than a specific fresh closing in the last 24 hours, still looks most c...