Podcast: Jon Winick, CEO Clark Street Capital​
​
In this first of my new podcast series, Real Estate Market Watch, current events through a real estate lens, my guest is Jon Winick, bio here on LinkedIn.​

Jon is a seasoned, multi-cycle real estate professional with an extensive banking background. CEO of Clark Street Capital, Jon is Chairman Emeritus and Director at SomerCor, one of the largest SBA lenders in the Midwest, has run his own student housing investment portfolio, and has held senior positions at Zions Bank and GE Capital.

Our conversation provides insights into current events and discusses practical signals you can watch for as you assess your investment decisions. Jon pulls no punches and is candid in his assessment.

Summary of our conversation follows:

Debt-Driven Reality: Understanding CRE’s Structural Fragility

Cracks Beneath the Surface

In this episode of The Real Estate Market Watch, I sit down with Jon Winick, CEO of Clark Street Capital, to explore the increasingly fragile foundation of the commercial real estate (CRE) market. Jon draws on decades of experience in loan portfolio sales, banking, CMBS investing, and student housing to deliver a sobering, detail-rich assessment of what’s coming next - and what’s already hiding in plain sight.

The Fed, Interest Rates, and the “Nuclear Option”
​Trump vs. Powell: Market Implications

Jon opens with a sharp critique of political interference in Federal Reserve policy. While the idea of firing Fed Chair Jerome Powell may feel remote, he warns that even sustained political pressure has consequences. Removing Powell, the so-called "nuclear option", would spark chaos in capital markets, undermining global confidence in the U.S. dollar and Treasury markets. “You cannot find an industry in which debt matters more than commercial real estate,” Jon says. A destabilized bond market affects CRE indirectly but profoundly by tightening liquidity and depressing investor confidence.

CRE’s Dependency on Debt: Liquidity as Lifeblood
​Why CRE Suffers When Capital Tightens

With rates elevated and uncertainty rising, Jon highlights the outsized role debt plays in CRE. Unlike most industries, capital structure is everything in real estate. Higher interest rates are more than a cost issue, they erode the viability of deals outright. His analogy lands hard: “Low rates are like tequila on a first date. High rates are like a glass of warm milk.”

Banking Behavior: The Art of Delay
​Defaults, Loan Maturities, and Creative Accounting

Despite rising delinquencies in CMBS, bank-reported CRE loan delinquencies remain surprisingly low. Why? Banks, Jon argues, are benefiting from regulatory changes that let them defer the recognition of problem loans. “The delinquencies that you're seeing in CMBS and bank loans will inevitably converge. Banks have been able to use some new rules to hide problem loans. And eventually that [runway] runs out.” he says. Bank defaults may not be catastrophic, but their opacity clouds the picture for investors trying to assess real risk.

Creative Destruction Denied
​Why Bailouts Delay the Inevitable

Jon argues the post-COVID economy is still “wrapped up by actual or indirect fraud.” From subsidized mortgages to suspended student loan collections, unsustainable federal programs have kept weak assets and businesses afloat. He makes a provocative case for embracing creative destruction. “We’ve basically decided as a society that we won’t let businesses fail… but that’s ultimately bad economics.”

Policy, Regulation, and the Supply-Demand Trap
​Deregulation and its Unintended Consequences

Dodd-Frank’s unintended effect was to choke off consumer credit, particularly in regions with few lenders. Jon compares Puerto Rico, with just three banks, to Iowa, with the same size population as Puerto Rico, with 246. The result? Higher interest rates, limited options, and an underfinanced economy. He calls for “smart, effective regulation,” warning that over-regulation concentrates power while under-regulation invites asset bubbles.

The Signals to Watch Now
​What CRE Investors Should Be Monitoring

Jon identifies several canaries in the coal mine for CRE investors:

• Widening CMBS credit spreads: These are leading indicators of borrowing cost pressures.
  ​
• Corporate bankruptcies and retail closures: Especially among large tenants like Walgreens or government departments exiting leases.
  ​
• Shifts in political winds: Regulatory reversals could radically alter CRE's operating environment.

Strategy: What Should CRE Investors Be Doing?
​Be Patient, but Be Realistic

For investors sitting on cash, Jon's advice is pragmatic: “Be patient… [but] waiting for a home run often means you miss out on a lot of great opportunities.” He urges caution and downside awareness in every negotiation, pointing out that real movement in the market won’t occur until lenders are forced to act or borrowers are out of options.

Final Thought: The Bond Vigilantes Will Win
​A System Bound by Market Forces

Jon closes with a sharp reminder that the bond market, not politicians, sets the true limits: “The bond vigilantes always get their way.” In a world dependent on debt, real estate investors should watch not just interest rates - but who controls the levers behind them.

***

As I've mentioned, the goal of this new podcast series is to help you make sense of a world that is rapidly changing so you can make better informed real estate investment decisions.

This episode delivers in spades.

​Here's a link to the full podcast.​

Thanks,
Adam

My next LinkedIn Mastermind will start next Tuesday, April 29, at noon pacific.

Four, one hour sessions over two weeks with me, live, where you'll become recognized as an industry leader, dramatically increase your lead-generation, and find more investors, clients, and customers.

Exclusively for real estate professionals and investors.
​

​​If this is your first time seeing this newsletter, please click here to subscribe.​

***

Connect with me on LinkedIn

​

Subscribe to my YouTube channel

​