Working with Local Lenders for Commercial Investment Financing

Good news: Local banks are lending (again). With a rekindled collective appetite for making commercial real estate loans, Florida banks are returning to the proverbial closing table by offering increasingly aggressive CRE loans to experienced, strong investors. Each portfolio lending institution is different in its approach and lending appetite, however, and understanding the nuanced differences in banks’ loan programs requires ongoing relationship-building with those banks’ commercial lenders.

With CMBS and Life Insurance companies resuming their own appetite for making loans to borrowers seeking lower-leverage financing, local banks are blurring lines of late between their traditional products and asset classes to better compete.

Marcus & Millichap Capital Corporation’s Associate Director Steve Goldwyn understands this. With more than ten years of commercial lending experience, Goldwyn says that by working very hard to build ongoing rapport with Florida’s lenders, he is in almost all cases able to find his clients the best loan structure available in the marketplace.

“Our capital markets team places loans with life companies, conduit lenders, credit unions, and national banks — and what we’re seeing is that the local banks understand their role,” says Goldwyn.

“As a whole, the locals [Florida banks] differentiate themselves by being nimble. What this means specifically is they welcome local sponsors who may have credit stories or own property out of state, or they are open to providing capital to foreign investors, allowing “max” “cash out” loans, financing special-purpose property types, or even considering lines of credit or smaller loan sizes.”

While the banks “know their role,” Goldwyn says, “Our role is to know the best landing spot for each investor’s loan request.”

Understanding what specific scenarios each bank’s commercial real estate lender welcomes requires the ongoing relationship-building that Marcus & Millichap is known for. Goldwyn says that it’s not enough to know generally what different banks will tolerate. It’s a matter of nuance and is something of an art form. “Listening to our lenders and discerning the shifting interests in lenders’ programs is what it takes in order to truly understand the local lending market,” Goldwyn says. He and his team are constantly renewing relationships and exploring individual lending programs. Quite often it’s the smaller, local banks that provide that ideal lending solution.

“Local banks look to our team for strong lending opportunities when they have capital to ‘put to work.’ I had a call from a local bank’s senior lender with aggressive capital to deploy on multifamily properties; they were looking to place up to $10 million for deals to close by the end of the month,” Goldwyn says. “This local bank is offering a degree of flexibility that you can’t get from large national financial organizations, life insurers, or conduit financing. That’s the type of connection we bring through the relationships we nurture in our market.”

“The banks look to Marcus & Millichap for deals because they know we attract the best investors,” Goldwyn added.

By working to maintain relationships with local lenders — and understanding “who’s doing what,” as he puts it — Goldwyn and his team are typically able to generate multiple competitive loan offers for investor clients. “We work diligently to have strong relationships with the lenders and are very confident that we’re able to ‘find the right home’ for our clients’ loan scenarios.”

[cta]The right information can give you an edge in a highly competitive investment climate. Marcus & Millichap Capital Corporation combines the expertise and relationships of its financing professionals to offer investors customized solutions beyond conventional financing. Contact us to find the capital you need to support your investment strategies.[/cta]