Short answer
Regional banks execute where the asset class is in their local sweet spot (tighter pricing, deposit relationship). HFAs participate where city incentive program structures it (sub-market rates, longer tenor, affordability set-aside).
Conversion-construction lender options routing: which lender for which deal
Routing playbook: NYC 467-m abated conversions → debt fund senior + NYC HDC junior. DC Housing in Downtown → bank or debt fund senior + DC HFA junior. Chicago LaSalle Street Reimagined → bank with TIF participation + Illinois HFA on affordable set-aside. California AB 2011 (no specific incentive funding) → debt fund or regional bank, no HFA. Always run a competitive bake-off across at least one debt fund, one bank, and the relevant HFA.
Sources
- Senior Loan Officer Opinion Survey on Bank Lending Practices (SLOOS) · Board of Governors of the Federal Reserve System · 2026-Q1
- Semiannual Risk Perspective · Office of the Comptroller of the Currency · 2025-12
- Apartment, Student Housing & Build-to-Rent Research · National Multifamily Housing Council (NMHC) · 2026-Q1