--Graham Bippart
Cantor Fitzgerald Commercial Real Estate plans to double its 30-person commercial real estate lending team in the next few months as part of a plan to originate about $5 billion of new loans by next August in a partnership with CIM Group. The firm, which has already hired a number of well-known executives from Credit Suisse, Bank of America and JP Morgan Chase, is looking for senior level originators and capital market executives, said Anthony Orso, executive managing director. The firm will use securitization as its exit strategy.
Orso, who said that Cantor was putting together an “all-star CMBS team,” said the firm’s lending practice will focus on urban U.S. markets and will target loans of $10 million to $150 million. This will fill a void left by regional banks that continue to shy away from the lending market. “There are a fair number of regional banks that have been closed or are on the Federal Deposit Insurance Corp.’s watch list,” Orso added, noting that Cantor could help to fill this void. And, with many institutions wary of lending even within the most liquid markets, Orso believes the partnership will be able to have its pick of the litter. “There are $1.4 trillion in loans coming [due] over the next few years,” he said. “We’ll be able to choose from the best.”
The group will handle all sales and trading internally. In addition to its CMBS trading desk, headed by Geordie Walker, the group can draw on the broader fixed-income distribution platform at Cantor Fitzgerald. Commenting on recent moves by issuers to have more investor-friendly structures, Orso said that Cantor’s securitizations will aim to strike a balance between the needs of senior and non-investment-grade bond holders.
Orso envisions a structure with lending offices in New York, Atlanta, Los Angeles, Dallas, Chicago, Washington, D.C., Boston and Miami. After a long dry spell, Orso is optimistic about the future of CMBS. Real estate values have stabilized and institutional bond investors are clamoring for commercial mortgage-backed securities, which was illustrated by the tight pricing on recent deals, he explained. “Our clients want something more than Treasuries. They’ve said to us very clearly, ‘We are interested in this product again,’” he said.