Ackman-Ziff Market Update (March 2026)

Equity. Equity. Equity.

It’s the dominant conversation in the market right now, and it’s one we’re deeply engaged in as well. We’ve been consistent in our message to sponsors: Pref/private credit is getting cheaper (perhaps too cheap), and we believe it’s only a matter of time before capital looks to chase upside and take on common equity risk.

The real question everyone keeps asking is when.

Our seat to view the market right now is, in our opinion, an exceptional one. We’re grateful to be working at a boutique firm in New York City where opportunistic capital comes to understand what their peers are doing to find an edge. We’re having conversations day in and day out with private equity that is trying to make 20’s and 2’s.

Most of them:
(i) can’t find it,
(ii) have troubled investments of their own they’re working out,
(iii) are having to go to places of the real estate spectrum that are so niche it is difficult to track (powered land, IOS, taking co-GP positions, etc.), or
(iv) deploying capital through preferred equity instead.

But opportunistic capital isn’t what primarily drives capital flows. Core capital does. And tracking core capital is relatively straightforward. This is an area where we believe we can add some differentiation. Anyone can see where CMBS or Fannie/Freddie spreads are. Anyone can pull sales comps on CoStar for newly delivered multifamily or industrial in gateway markets and back into cap rates. It often feels like the same 20 to 30 groups show up for every “core” trade, and the same 20 to 30 lenders show up for every stabilized financing.

Where we try to add value is in being able to walk into a private equity firm’s office and have a thoughtful conversation around net levered IRRs and MOICs across different risk profiles, recapitalizations and rolling embedded GP promotes into newly formed ventures, LPs taking ownership stakes in GPs and how those structures have been implemented for comparable operating platforms, the differences between preferred equity rights and mezzanine rights and how those dynamics can influence the senior mortgage, the distinction between preferred equity treated as equity for tax purposes versus debt, and the nuances of comparable development capitalizations, including whether the equity was true common or included structural layers such as subordinated land basis.

Speaking to core capital is generally more straightforward, even if you’re not immersed in it every day. Opportunistic capital requires a different level of preparation and credibility. Trust takes time to build and can disappear quickly. Opportunistic capital tends to be more conviction-driven, whereas core capital is often more process-driven. Someone underwriting a 20 and 2 structure is doing so based on a view of the opportunity. Someone underwriting a day-one cash-on-cash is typically doing so based on a DSCR test. The conversations around those two profiles are very different. It can make the business more complex, but also more interesting.

For example, we’ve had the same equity fund step back at committee on three deals in the last nine months. Each time the message was encouraging – “this one is different and our committee has been prepped” – and each time the result was the same – “we had support of every decision maker except the one that mattered.” It’s so difficult to say we’ll never take them seriously again because equity is such an outlier. We can’t afford to overlook any credible source of capital. But when we ultimately find the right partner, boy does it feel good.

All of this is to say that our activity in the market helps us maintain a strong pulse on liquidity for opportunities and the cost of capital.

So when do we think common equity really comes back? In our view, it’s when capital markets intermediaries can look capital in the eye and say with confidence, “we’re asking for common and we believe it will get done.”

That conviction generally comes from a few places:
(i) the risk-adjusted return of the opportunity compares favorably to other deals currently circulating in the market,
(ii) there is enough capital pursuing that strategy to create a competitive dynamic, or at least the perception of one, and
(iii) the exit assumptions back into core capital feel supportable.

Said more simply, common equity returns when the advisors who help shape the market, and who maintain trusted relationships with capital, feel confident that the conditions are there to get it done. Not simply because of a market signal, compression in private credit returns, interest rate moves, capital raising trends, or even a slowdown in new supply across high-growth markets.

Wanted to share information on a great educational program our company hosts each summer called "AZ Educate". Thought it might be of interest for any analysts, interns, family members, or close friends who are college-aged or recent grads.

It’s a four-day, online crash course focused on relationships, network, and ethics, led by Simon Ziff, with industry leaders joining throughout the program.

A few highlights for participants:

• 150-200 new peer connections within the CRE network they likely wouldn’t otherwise have access to.

• We’re seeing AZ Educated listed on resumes across NYC, Miami, LA and other major markets.

• Faculty from NYU and Columbia, as well as founders of CRE firms, have reached out to share strong feedback they’ve heard about from the program.

Applications are open through May 15. You can find more details and the application here: https://www.ackmanziff.com/azeducate/

Jordan Brustein; Andrew Rudy

E: [email protected]; [email protected]

M: (JB) 516-996-7722; (AR) 858-947-8738