Anticipating a $2.5 trillion wave of commercial real estate debt maturing between 2023 and 2027, Walker & Dunlop Inc. is launching a new credit portfolio advisory service for lenders including comprehensive portfolio evaluation services, asset financing advisory, loan sales services and investment sales advisory.
Run by its Capital Markets team, Walker & Dunlop will be leveraging its $121 billion servicing portfolio and national investment sales platform, which has closed nearly $40 billion of transactions in the last two years, to provide the services to credit providers.
The increase in debt maturities is also coming while the CRE market continues to face economic challenges including a rising interest rate environment, high inflation, asset revaluations and a muted liquidity environment. With all these headwinds as a backdrop, Susan Mello, executive vice president & Group Head, Capital Markets Walker & Dunlop, said it is more important than ever for credit providers to actively manage their portfolios.
Mello said in prepared remarks the Capital Markets team will be working across the broader Walker & Dunlop platform to evaluate and underwrite lender’s loan portfolios or individual positions, determine the right execution to maximize principal recovery of distressed assets and market the sale of those assets to the appropriate buyer pool.
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The credit portfolio advisory business will be overseen by the Walker & Dunlop New York Capital Markets team led by Co-Heads Aaron Appel, Keith Kurland, Jonathan Schwartz and Adam Schwartz. The team will work with credit providers to replace existing financial facilities, sell or create liquidity for performing, sub-performing and non-performing loans and market REO assets for sale, while structuring accretive solutions for clients to maximize value.
Commercial real estate veterans Sean Reimer and Jordan Casella, who have more than 40 years of experience working as principals, brokers, bankers and credit providers through various market cycles, will spearhead the efforts.
Appel said in a prepared statement the team began working with capital providers last year in the second quarter to help them effectively manage their credit portfolios during an evolving capital markets landscape. He said the team has placed more than $20 billion of credit and equity transactions to more than 150 counterparties in the last two years. That includes more than $3 billion of equity raised as well, Appel added.
Despite a challenging environment in the second half of last year, the Walker & Dunlop Capital Markets segment sourced capital for transactions totaling more than $21 billion from non-agency capital providers. The firm continues to be a top advisor on all asset classes for many of the industry’s top developers, owners and operators.