Westmount Square Capital

Westmount Square Capital is expanding, and we’re hiring an Asset Management Analyst to join our team! This is a high-visibility role with direct exposure to asset management, acquisitions, and financings across our growing multifamily portfolio. The Analyst will work closely with senior leadership, taking ownership of financial modeling, value-add strategy execution, investor reporting, and transaction support. If you thrive in a fast-paced environment and want to help drive performance at a high-growth real estate investment firm, we’d love to connect. Send your resume to info@westmountsquarecap.com. #Hiring #RealEstate #AssetManagement #PrivateEquity #Multifamily https://lnkd.in/gJJw9u_B

Distress Multifamily Series | Week 8: The 3 Deals You’ll Never See on Market — And How We Find Them In distressed markets, the highest‑value opportunities rarely surface via broker blasts. They’re hidden in the shadows—held by GPs without dry powder, legacy LPs seeking discreet exits, or servicers waiting for the right, trusted counterparty. These “shadow inventory” assets are where real alpha lives. Three Off‑Market Scenarios Where Westmount Square Capital Finds Alpha: - GPs with no capital and limited incentive to sell: These managers are stuck in legacy deals and have no means—or desire—to solicit public bids, but may quietly explore liquidity options. - Pref/mezz holders who want liquidity, not headlines: To avoid signaling distress or triggering write-downs, these investors engage only through discreet channels. - Special servicers willing to sell, but choosing timing over top bids: They wait for buyers they trust—buyers like WSC—rather than broadcasting publicly. WSC’s Differentiation: How We Source Silent Deals - Direct GP relationships built over time give us early sightlines on legacy positions before public marketing. - Trusted servicer dialogue, relying on our reputation for discretion and decisiveness. - LP redemption network taps into early liquidity needs before assets reach the open market. Why This Matters: Market Context - Private credit surpassed $1.5 trillion in AUM by early 2024, growing from $1 trillion in 2020—and projected to reach $2.6 trillion by 2029 (Morgan Stanley). - Some estimates peg global private credit at nearly $2 trillion now, with projections to $3.5 trillion by 2028 (Business Insider). - Meanwhile, default risk is rising: KBRA expects a 3% default rate for direct lending in 2025, up from 1.9% in 2024; Fitch Ratings recently reported a 4.6% rate in May 2025. As distress grows, quietly-sourced assets often outperform—and mainstream markets don’t always surface the most attractive risk‑return profiles. Why WSC Moves Where Others Don’t - We operate ahead of public channels—not waiting for bids, but actively sourcing. - We’re known as quiet, decisive counterparts—trusted by GPs, LPs, servicers. - We deliver tailored liquidity solutions, especially in complex, sensitive situations. If you're interested in working with a counterparty that understands the value of silence and patience, let's connect. Lenders, Sponsors, LPs: Do you have an asset you'd like to discuss? If you'd like to discuss a transaction or asset management mandate, please reach out to Hunter Hagdorn at hunter@westmountsquarecap.com. #MultifamilyDistress #CapitalStackStrategy #PrivateEquityRealEstate #YieldOnCost #BridgeDebt #OperationalTurnaround #PreferredEquity #NotePurchases #WestmountSquareCapital

Distress Multifamily Series | Week 7: The Deal Doesn’t Die in Due Diligence—It Dies in Legal. In distressed multifamily, most failed deals don’t implode over valuation or physical condition. They implode when legal complexity enters the room. Legacy JV agreements. Anti-assignment clauses. Consent rights from mezz lenders or LPs who haven’t been heard from since 2019. Control provisions that never anticipated distress. We’ve all seen it: a willing buyer, a desperate lender, a signed LOI… then silence for six weeks while lawyers untangle the capital stack. And suddenly, the deal’s dead. Why? Because complexity kills execution. - Outdated documents prevent assignments or transfers without unanimous consent - Layered capital stacks require coordination across multiple stakeholders with veto rights - Ambiguity in control rights creates deadlock when fast decisions are needed most As Thomson Reuters puts it: “The more parties involved in the capital stack, the more difficult and time-consuming it can be to achieve a successful workout.” At Westmount Square Capital, we’ve learned that underwriting the asset isn’t enough. We underwrite the governance. We model JV mechanics the same way we model operating cash flow. Our internal diligence process reviews legal control, transfer rights, and consent hurdles before we even submit an offer. That legal-first approach means we don’t just bid aggressively—we close quickly. If more distressed deals are coming, legal agility—not just dry powder—will determine who can execute. *Question for the industry* What’s the most unexpected legal bottleneck that’s killed a deal you were working on? Lenders, Sponsors, LPs: Do you have an asset you'd like to discuss? If you'd like to discuss a transaction or asset management mandate, please reach out to Hunter Hagdorn at hunter@westmountsquarecap.com. #MultifamilyDistress #CapitalStackStrategy #PrivateEquityRealEstate #YieldOnCost #BridgeDebt #OperationalTurnaround #PreferredEquity #NotePurchases #WestmountSquareCapital

Distressed Multifamily Series | Week 6: Distress ≠ Opportunity — Until You Find the Right Seller In today’s market, everyone is talking about distress. But not every distressed deal is a real opportunity. For every multifamily asset facing a maturity default, insurance spike, or cash flow collapse, there’s often an unwilling or unable seller behind it—anchored to outdated valuations, entangled in litigation, or constrained by fund-level politics. The reality: most “distressed” deals never close. According to Trepp, Inc. and RCA, over $140 billion in multifamily distress exists today—including loans in default, watchlisted, or at risk. But only about $2 billion of that has traded over the past 12 months. That’s less than 1.5% of the pipeline. So where’s the disconnect? • Stubborn sponsors still pricing assets like it’s 2021 • Legacy LPs tied up in frozen funds or redemption queues • Litigation and title risk in capital stacks where equity has been wiped  • Lenders unwilling to foreclose and committed to offering more time while compounding the basis    At Westmount Square Capital, we take a more targeted approach. We don’t chase every busted deal. Instead, we focus on uncovering actionable, off-market opportunities through: • Loan acquisitions and assumptions via direct bank and credit fund engagement • LP redemption opportunities, where funds quietly seek partial exits • Recap negotiations with institutional sponsors needing liquidity or a new capital partner These sourcing channels allow us to avoid auctions, navigate complexity, and work directly with sellers who are ready—and able—to transact. Distress is everywhere. Execution is rare. We focus on the small subset of deals where pricing, timing, and structure align—and where we can actually get to the finish line. Discipline and sourcing advantage are what convert market noise into real opportunity. Lenders, Sponsors, LPs: Do you have an asset you'd like to discuss? If you'd like to discuss a transaction or asset management mandate, please reach out to Hunter Hagdorn at hunter@westmountsquarecap.com. #MultifamilyDistress #CapitalStackStrategy #PrivateEquityRealEstate #YieldOnCost #BridgeDebt #OperationalTurnaround #PreferredEquity #NotePurchases #WestmountSquareCapital

Distressed Multifamily Series | Week 5: The Maturity Wall Didn’t Collapse—It Quietly Rolled Forward The $310B in multifamily debt set to mature by the end of 2025 isn’t the full story - don't believe everything you read about the "maturity wall." What’s more telling is that >30% ($97B) of that volume has already been extended—by far the largest of any asset class (Colliers, Trepp, Inc.). These aren’t resolved situations. They’re deferred problems waiting for real capital solutions. Meanwhile, deal activity is recovering. In Q1 2025: - $98B in U.S. CRE deals closed, with multifamily up 35.5% QoQ (CRE Daily). - Banks led non-agency originations with a 34% market share. - Spreads compressed to 149 bps, the tightest since early 2022 (CBRE). So if transactions are happening, why are so many loans still stuck? Because the capital stacks don’t clear—yet. That’s where we come in. At Westmount Square Capital, we focus on extended, off-market opportunities where traditional liquidity is constrained. We specialize in: - Engaging with lenders early, often before a maturity default or special servicing transfer, to understand repayment risk and pain points. In certain cases, the lender is also impaired and we have creative solutions to avoid accounting mark downs. - Recapitalizing broken structures through bespoke solutions: subordinated debt, rescue hybrid equity, and sponsor resets with real skin in the game. - Creating alignment across the capital stack—whether through interest deferral, waterfall restructuring, or upside-sharing mechanisms—to avoid binary outcomes like foreclosure or note sales. - Underwriting based on today’s fundamentals, not stale valuations, inflated pro formas or unrealistic exit caps. These aren’t theoretical solutions—we’re actively structuring them across the country. Lenders, Sponsors, LPs: Do you have an asset you'd like to discuss? If you'd like to discuss a transaction or asset management mandate, please reach out to Hunter Hagdorn at hunter@westmountsquarecap.com. #MultifamilyDistress #CapitalStackStrategy #PrivateEquityRealEstate #YieldOnCost #BridgeDebt #OperationalTurnaround #PreferredEquity #NotePurchases #WestmountSquareCapital

Distressed Multifamily Series | Week 4: Buying at a Discount Without Catching a Falling Knife We don’t guess at the right entry point—we back into it. At Westmount Square Capital, our approach to distressed multifamily starts with a rigorous assessment of fully-loaded basis: acquisition price, aged payables, necessary CapEx, interest and operating reserves, and working capital to stabilize operations. From there, we reverse-engineer what we’re willing to pay by targeting a yield on cost that exceeds the expected exit cap by 150–200 bps, adjusting for vintage, location, and submarket volatility. This yield spread—anchored in today’s capital markets environment—is the foundation of our downside protection. It ensures we’re not just buying at a discount, but at a level that compensates for risk and allows for value creation over time. The days of buying on price per door are far behind us! We typically inject fresh equity at the attachment point that satisfies this return threshold. That may be above the impaired loan basis, or it may require negotiating a new capital stack entirely. We work collaboratively with lenders, servicers, pref equity and mezz lenders, and existing sponsors to structure a deal that clears for everyone—so long as the economics pencil. Why does this matter? Because entry price discipline still drives most of the IRR. According to Green Street, apartment values remain 15–20% below peak and cap rates have expanded 150–200 bps off their lows. Meanwhile, replacement costs remain 30%+ above 2019 levels and new supply absorption is lagging in key Sunbelt markets (RealPage, May 2024). Buying below replacement cost isn’t enough. We target the capital structure where cash flow, cost basis, and risk align. Other strategies—note buys, rescue debt, forward flow pipelines—are tools we use selectively. But our core thesis is simple: find the right attachment, and let the math and our operational know how do the work. Lenders, Sponsors, LPs: Do you have an asset you'd like to discuss? If you'd like to discuss a transaction or asset management mandate, please reach out to Hunter Hagdorn at hunter@westmountsquarecap.com. #MultifamilyDistress #CapitalStackStrategy #PrivateEquityRealEstate #YieldOnCost #BridgeDebt #OperationalTurnaround #PreferredEquity #NotePurchases #WestmountSquareCapital

Distressed Multifamily Series | Week 3: Development Math Is Broken & Why New Supply Will Stay Frozen Across the Sunbelt and beyond, the math behind ground-up multifamily development has stopped working. Construction costs are up ~40% since 2019, according to CBRE. That alone would be enough to challenge feasibility. But it’s not the only issue: - The average all-in cost of capital—including construction debt and equity—has surged past 10%, with many lenders stepping away from the market entirely. - Developers once targeted a 6.0%+ yield-on-cost. Today, even hitting 5.0% is a stretch, and StepStone’s research confirms that most markets aren’t supporting it. - With cap rates expanding 100–150 bps off their 2021 lows, stabilized values are no longer high enough to justify what it costs to build. Even if demand holds, the pipeline is drying up. New starts have dropped over 60% year-over-year, per NMHC, and absorption is catching up to recent deliveries. In the Sunbelt, only ~1.2M of the 1.8M units delivered post-COVID have been absorbed (RealPage, 2024). That imbalance won’t self-correct fast. It’s not just that deals aren’t penciling—it’s that capital is on strike. The result? 1. Fewer deliveries in 2026–2028, which will coincide with maturing bridge debt and distress working through the system. 2. Stabilized, cash-flowing assets become more valuable, especially those below replacement cost. At Westmount Square Capital, we’re focused on acquiring quality assets where the debt basis may be broken, but the physical asset is not. If it would cost more to build the property today than to buy it at our basis, we’re interested. We're not betting on cap rate compression. We're betting on math. And right now, the math says: don't build. Buy smart. Lenders, Sponsors, LPs: Do you have an asset you'd like to discuss? If you'd like to discuss a transaction or asset management mandate, please reach out to Hunter Hagdorn at hunter@westmountsquarecap.com. #MultifamilyDistress #BridgeDebt #OperationalTurnaround #PreferredEquity #NotePurchases #WestmountSquareCapital

Multifamily Distress Series | Week 2: When Good Locations Meet Broken Business Plans A lot of what’s showing up in today’s multifamily distress pipeline didn’t start out broken. It’s deals where the real estate was fine—but execution faltered—and then the debt structure turned a difficult situation into a distressed one. Think of something like this: • 1980s product in a growing Sunbelt market • Acquired in 2021 with floating-rate bridge debt, minimal reserves, and an aggressive value-add plan • Construction delays, poor lease-up, rising delinquencies • Then rates jump, massive expense inflation, CapEx dries up, payables pile up and there’s no runway left This is the profile we’re most focused on—where the loan basis makes sense, but operations fell short and the structure didn’t leave room for error. At Westmount Square Capital, we step into these situations as both capital and operator. Sometimes that means buying the note or pref equity at a discount. But more often, it means working with the existing lender to stabilize the asset without forcing the issue and/or the Sponsor to help salvage their invested capital —avoiding pain where we can, and preserving value where we can’t, and ultimately restructuring the stack to achieve a >7% Yield on Cost. The backdrop makes this especially relevant: • $250B+ in multifamily loans maturing by 2026 (MSCI, May 2024) • Nearly 80% of 2021–2022 bridge originations were floating-rate IO (Trepp, 2024) • Most value-add plans from that era were underwritten to assumptions that don’t hold up today The longer things drift, the worse the outcome. But if the basis is sound and the asset’s worth saving, there’s still a way forward. We’re actively looking at these deals—if you’re seeing something similar, let’s connect. #MultifamilyDistress #BridgeDebt #OperationalTurnaround #PreferredEquity #NotePurchases #WestmountSquareCapital

Multifamily Distress Series, Week 1: Why This Isn’t 2008 This is the first post in our weekly series on the multifamily distress cycle, which we believe is one of the most mischaracterized and misunderstood opportunities in today’s market. Unlike 2008, this isn’t a collapse in occupancy or rent. What we’re seeing now is a structural reset—driven by capital stack compression, financing disruption, and broken development math. Here’s the backdrop: - Construction costs have increased nearly 80% since 2019 (StepStone + BLS), pushing required rents beyond what most markets can support. - Bridge loan originations exceeded $400 billion from 2019–2023, creating massive refinancing flow pressure.   - Refinancing risk is growing across the sector, particularly where short-term floating-rate debt was used on projects underwritten with different rate assumptions. - Cap rates compressed by over 200bps from 2019 to their lowest point in Q3 2021 in many major metros, particularly in the Sunbelt. - $646 billion in private real estate is now outside its intended hold period, much of it capitalized pre-rate hike cycle. - New construction has slowed significantly, but recapitalization activity is accelerating—especially in capital-heavy metros. Refinancing Risk: An estimated $84 billion of multifamily debt matures in 2025 and $89 billion in 2026—significantly above the decade average—per Yardi Matrix. Supply vs. Demand: From 202-2024, ~1.8 million units were delivered, of which ~1.6 million have been absorbed. While demand remains robust, there is a significant volume yet to be absorbed; many major metros still have material delivery pipelines. Summary: The distress we’re seeing today is largely about the supply and cost of capital, and not necessarily the quality of the underlying assets. Many properties are fundamentally sound, but the capital structures supporting them are out of alignment with today’s market. Operational distress can also be an aggravating factor when paired with challenged capital stacks. Over the coming weeks, we’ll unpack deal structures, sourcing strategies, and trends across geographies where distress is creating real opportunities. Next week: Anatomy of a Multifamily Recap. #MultifamilyDistress #PrivateCredit #RealEstateInvesting #StructuredFinance #CRE #WestmountSquareCapital