Commercial/Multifamily Briefs July 21, 2022
TIAA Bank Launches Program for Small-Balance Loans
TIAA Bank’s commercial real estate team unveiled a program to accelerate small-balance loans of $2 to $5 million. The program targets brokers needing help with properties, such as multifamily, retail, self-storage, student housing and small-cap industrial.
“Loans for unanchored strip retail should not be subject to the same process as deals for metro office towers,” said Ellen Comeaux, TIAA Bank’s Senior Vice President and Commercial Division Leader. “We’ve always handled small balance loans differently than larger transactions, but now we’ll have a dedicated team to streamline the underwriting, shorten the checklists and reduce the need to negotiate documents,” Comeaux said. “This will be faster and simpler for all parties, and it could save borrowers weeks of time and thousands of dollars.”
The announcement comes as many lenders have moved out of the smaller loan space, instead focusing on larger loans to meet aggressive capital deployment targets. TIAA Bank’s program will provide a programmatic, customized approach from origination through closing that includes:
• A scoring model on the origination side that limits due diligence items for approval. Borrowers could now receive approval in as little as two days, not two weeks.
• Standardized, in-house loan documents that are borrower-friendly and could eliminate the need for outside legal counsel. That could save borrowers more than $20,000.
• Shorter borrower questionnaires and streamlined environmental forms.
• An increased use of limited property inspections rather than property condition assessments that take longer and often cost about $3,000
• A reduced need to collect estoppels and Subordination, Non-Disturbance and Attornment Agreements.
“Our goal,” Comeaux said, “is to get borrowers to the closing within 45 to 60 days.”
TIAA Bank reported seeing an uptick in demand for several of these types of properties. During the first quarter, for example, a third of the deals were for small-balance multifamily housing, almost a quarter were for small-balance retail and more than 10% were for small-balance self-storage.
Additional information on the program can be found at www.TIAABank.com/CRE.
Brook Farm Group Launches Multifamily Development Firm
Peter DiCorpo and Eric Hade launched Brook Farm Group, a new multifamily development firm that will focus on rising demand in “lifestyle” and “path-of-growth” markets throughout the Sunbelt and Mountain States with a concentration on dynamic MSAs in the southeastern United States.
“The multifamily sector has had a phenomenal run over the past 10-plus years, and we expect strong activity to continue. Despite some near-term challenges with supply chain disruptions and commodity price volatility, we see continued long term demand growth in the rental residential sector,” DiCorpo said. “There is still plenty of runway left in the multifamily sector and our experience navigating through complex market cycles, along with our strong financial backing, provide a solid foundation for our development efforts.”
DiCorpo and Hade have expertise across the development, acquisition, joint venture, investment and asset management spectrum, with career project completions totaling more than 40,000 units and $10 billion on a total development basis. The team has several development projects in the pipeline and expects to start construction in Q1 2023.
Brook Farm Group will develop communities in path-of-growth and lifestyle markets throughout the Sunbelt and Mountain states and will be pursuing a wide variety of rental residential housing types, including traditional garden style, mid-rise, high-rise, townhome and single-family build-to-rent. In many cases, Brook Farm Group will design communities with a combination of several product/density types to encourage a more natural, organic neighborhood that will serve a wider variety of residents. This approach is designed to build vibrant communities and create opportunities for residents to engage in dynamic, fulfilling interpersonal exchange.
The company is based in Atlanta.
