Daily market intelligence on mortgages, equity raising, investment sales, and CMBS.

Tuesday, 09 April 2019

Mortgage Lender 3650 REIT Funds $800Mln in Year 1; Aims for $2.5Bln in 2019

Mortgage lender 3650 REIT funded about $800 million of loans in its first full year in business and expects to more than triple that, to $2.5 billion, this year. It differentiates itself by providing white-glove servicing to borrowers, promising to be with them and work with them for the life of their loans.

Commercial Real Estate Direct Staff Report

Mortgage lender 3650 REIT funded about $800 million of loans in its first full year in business and expects to more than triple that, to $2.5 billion, this year.

That's a tall order, but based on the finance company's existing pipeline of loans, it's more than likely to hit the mark.

The company was founded last April by Jonathan Roth, who previously was president of Canyon Partners Real Estate, and Justin Kennedy and Toby Cobb, who previously had founded developer Grass River Property. The trio's goal was to create a lending platform that truly focused on meeting borrower needs.

To that end, it's senior management is populated by seasoned servicing professionals, including Jack Cohen, who for 25 years had led Cohen Financial, where he oversaw the growth of the company's loan servicing portfolio to $35 billion; and Peter LaPointe, who before joining Grass River in 2013 was president of LNR Property's servicing division. Both Cohen and LaPointe were named managing partners. Also part of the company is Henry Bieber, head of loan servicing, who previously was head of Cohen Financial's servicing and asset management operation.

The company also has eliminated what it calls "nuisance" fees, those pesky charges that are particularly common in the CMBS conduit world. CMBS borrowers have complained that they'll get a $35 invoice, for instance, when they request a $10,000 release from a cash reserve account to fund a tenant improvement.

"We're doing something different, we've eliminated all nuisance fees," said Cobb, who with Kennedy oversees the company's long-term lending efforts. "We engage with the borrower for the life of the loan," he added, noting that the 3650 REIT name is derived from the idea that the company would stay with the borrower for the life of a loan, which can be up to 10 years.

Added Kennedy: "We create a virtuous cycle on day one due to our relationship with the...





weekly-call-to-action

“The Weekly”

“The Weekly” is Commercial Real Estate Direct’s PDF newsletter, sent to subscribers every Friday morning. With over 100 news stories published on Commercial Real Estate Direct each week, “The Weekly” features the top stories in commercial real estate that industry participants need to know first. “The Weekly” also contains:

  • Breaking mortgage, CMBS, and REIT news

  • Quarterly league tables with rankings of B-piece buyers, book runners, and lenders

  • Industry moves and changes in “The Insider“

Data Digest

 

CMBS DELINQUENCY VOLUME

dqdataFP1

 

CMBS SPECIAL SERVICING VOLUME

sschartfp

Top Bookrunners Domestic, Private-Label CMBS - 2017
Investment Bank #Deals Vol$mln MktShr%
Goldman Sachs 17.59 11,819.34 13.68
JPMorgan Securities 14.52 10,968.11 12.70
Citigroup 12.04 10,012.71 11.59
Wells Fargo Securities 14.02 9,936.06 11.50
Deutsche Bank 12.55 9,879.74 11.44

 

RCA CPPI

 

cppichart FP

 

 

CMBS 2.0 Spreads

AAAspreads

Top CMBS Loan Contributors - 2017
Lender #Loans Vol$mln MktShr%
Goldman Sachs 146.89 11,719.34 13.63
JPMorgan Chase Bank 117.68 10,114.14 11.76
Deutsche Bank 198.48 9,689.97 11.27
Morgan Stanley 166.18 8,539.78 9.93
Citigroup 199.05 8,088.24 9.41

 

 

 

REITCafe

  • Challenging Retail Environment Weights on REITs
    Mixed economic news is weighing on retail markets, pushing REIT performance down in 2015. This week, the National Retail Federation announced that back-to-school spending is expected to be down 9.3% in 2015. This news came on the heels of a report from the Commerce Department stating that retail sales declined 0.3%...
     
  • US REITs Feeling Effects from Turmoil in Greece and China
    International economic forces have taken center stage this week, affecting both US stock markets and REITs. The crash in the Chinese stock market and ongoing concerns about the future of Greece in the eurozone drove markets down during the first half of the week. REITs fared better than the overall market...

  • What Does Increased Construction Mean for Apartment REITs?
    REITs so far this year have raised $17.1 billion of capital through the sale of unsecured notes, bringing the total raised over the past two and a half years to just more than $75 billion. That’s more than they raised during the previous five years. The massive volume shouldn’t be a surprise as it comes while the yield from 10-year Treasury bonds, the benchmark...
shouldn’t be a surprise as it comes while the yield from 10-year Treasury bonds, the benchmark against which most REIT’s price their bonds
warehouse-backstage