How CRE is Adjusting to High Rates with Abe Bergman, CEO of Eastern Union

Thursday, May 15, 2025

• Decoding Real Estate podcast: As high rates reshape real estate lending, Eastern Union’s Abe Bergman explains how borrowers are adapting and what could change with new Fed leadership.

• Hot and code: Nordic countries are harnessing waste heat from data centers to power district heating systems and sustainably warm thousands of homes.

• Cuomo calculus: Developers are reluctantly backing Andrew Cuomo’s 2025 NYC mayoral bid as a strategic hedge against progressive challengers.

• Multifamily market shifts: Join our webinar May 20th to learn how industry leaders are navigating tighter margins and rising renter expectations in the months ahead. Sign up

Decoding Real Estate Podcast

How CRE is Adjusting to High Rates with Abe Bergman, CEO of Eastern Union

When the Federal Reserve began rapidly increasing interest rates in 2022, the commercial real estate sector braced for disruption. With refinancing harder and valuations under pressure, many hoped rates would fall quickly. That hasn’t happened, and the industry is now coming to terms with a long-term shift in the lending environment.

On the Decoding Real Estate podcast, Eastern Union CEO Abe Bergman shares how borrowers are adapting. From new loan preferences to the growing role of private lenders, strategies are evolving quickly. Despite fears about a wave of loan defaults, Bergman offers a more grounded perspective and points to signs of resilience among property owners.

The conversation also touches on the broader financial system, including how recent bank failures and regulatory changes have reshaped the lending landscape. Looking ahead, political shifts could play a role too, with a new Federal Reserve Chair expected in 2026. Bergman weighs in on what that could mean for future rate policy.

Nordic Data Centers Warming Homes While Battling Environmental Downsides

In Finland and Sweden, waste heat from data centers is being captured and reused to warm homes via district heating systems, turning an environmental challenge into a partial solution. Towns like Mantsala already heat thousands of homes with excess warmth generated by nearby computing facilities. Microsoft is now constructing the world’s largest data center heat recovery project in Espoo, aiming to supply heating to 40% of the city. With cooling costs reduced by the cold Nordic climate and access to low-carbon power grids, the region has become a magnet for tech firms seeking greener operations. While companies benefit from energy efficiency and reputational gains, local residents enjoy more stable heating costs and reduced emissions.

Still, the approach has limitations. Data centers consume immense amounts of power, often more than they give back in heat, and their electricity demand is set to surge with the rise of artificial intelligence. Concerns are growing about their limited job creation and competition for grid capacity, leading some governments to rethink tax incentives and push for stricter efficiency rules. Critics argue that while heat recovery reduces harm, it doesn’t negate the sector’s environmental impact. Nonetheless, new EU laws requiring waste heat reuse and transparency may drive broader adoption, especially as both regulation and consumer expectations around sustainability increase.

Cuomo Becomes NYC Real Estate’s Reluctant Favorite in Mayoral Race

Despite a contentious past with New York City’s real estate industry, former Governor Andrew Cuomo has emerged as its unlikely favorite in the 2025 mayoral race. Once frustrated by his rent reforms and tax incentive delays, developers are quietly funding his campaign, contributing over $2 million to a pro-Cuomo super PAC. With progressive challengers pushing for rent freezes and stricter regulations, industry leaders view Cuomo as the most viable moderate option, even if he’s far from their ideal candidate.

Cuomo has recently signaled a shift, expressing regret over earlier housing policies and criticizing elements of the current 421-a replacement. Still, skepticism lingers. His campaign’s ties to union figures critical of the industry and his track record as governor make many wary. For developers, backing Cuomo is less a show of support than a calculated move to preserve influence and avoid more aggressive, left-leaning alternatives.

Are You Enjoying This Newsletter?

Propmodo Daily is written and edited by Franco Faraudo with contributions from readers like you and the Propmodo team.

📧 Forward it to a friend and suggest they check it out.

🔗 Share a link to this post on social media.

🗣 Have ideas for future topics (or just want to say hello)? Share your feedback and tips at [email protected] or connect with us on X through @propmodo.

✅ Not subscribed yet? Sign up for this newsletter here.

📫️ Please add our newsletter email, [email protected], to your contacts to make sure you don’t miss any updates.

Enjoy reading about trends and innovation in commercial real estate? Subscribe to Propmodo.com for unrestricted access to reliable, data-driven journalism and exclusive insights available only to subscribers.