Life Company Appetite for Commercial Mortgage Allocations High Across All Asset Classes in Early 2021; Bank Lenders Extremely Active in Funding Smaller and Mid-Sized Loans

Gantry, the largest independent commercial mortgage banking firm in the U.S., has secured $1.16 billion in new commercial mortgages across 115 unique transactions during Q1 2021. This represents a very strong quarter for the company in both total loan production and volume of individual loans. Expectations are that a still historically low interest rate environment, significant array of compelling loan structures and abundant capital allocations meeting a range of borrower priorities will continue to motivate strong production numbers in Q2 2021.

“Commercial mortgage lenders remain active but focused on diligent underwriting for what they continue to see as a preferred investment option,” said Michael Heagerty, principal and CFO with Gantry. “Despite the slight recent upticks in treasury rates, the market remains in a historically low-rate environment with a multitude of funding sources available. This is a compelling landscape for qualified borrowers seeking tailored solutions for their operating priorities and goals. Lender competition for quality assets remains strong in 2021.”

In terms of capital allocations by asset class, Gantry’s Q1 2021 originations, ranked in descending order, included multifamily, self-storage, office, industrial, and retail assets; with life companies, banks and agency lenders ranking as top funding sources by volume and value, also in descending order. Notable trends in relevant Gantry verticals include:

Production

Gantry originated a total of 115 individual loans in Q1 resulting in an average loan size of over $10 million. Gantry’s roster of banks and credit unions were extremely active in smaller to mid-sized loans, and agency lenders delivered a variety of appealing multifamily financing options. Extremely active life company lenders exceeded 75% of total loan dollars for the quarter as their loan sizes increased in 2021. Highlights to Gantry’s Q1 life company transactions included:

• $364 million for a self-storage/industrial portfolio refinance
• $210 million multifamily portfolio refinance
• $35 million of construction-to-permanent multifamily development funding

Service

Gantry, a long-rated Primary Servicer by Standard & Poor’s, continues to see near 100% of expected performance from its more than $17 billion portfolio of serviced commercial mortgages spanning more than 2,000 loans in 43 states. Gantry’s diligent outreach and proactive forbearance discussions throughout 2020 have kept nearly all distressed loans moving towards original loan terms. The company continues to mitigate impacts from problem loans early in the process through quick action from a team of seasoned experts with decades of experience navigating distressed market dynamics. Gantry expects to see a continued trend of asset performance for the foreseeable future due to these efforts.

Culture

Gantry added four new executives to its team of client-facing production talent in Q1 2021 with new hires at the firm’s Los Angeles, Phoenix, Newport Beach, and Portland offices. As the largest independent commercial real estate banking firm in the United States and a leading member of the Strategic Alliance Mortgage (SAM) network, Gantry plans to continue growing its production team in 2021 when candidates and lateral recruits demonstrate a like-minded independent drive and a requisite depth of expertise in commercial mortgage finance.

About Gantry

Gantry, a privately held company headquartered in San Francisco, is a full-service mortgage banking firm with an extensive lineup of correspondent lenders utilizing Gantry’s production, closing and servicing capabilities. Established in 1991, Gantry is currently staffed by nearly 90 professionals in regional offices throughout the western United States and in New York. The company’s national servicing platform, valued at nearly $17 billion, represents more than 2,000 loans located in 43 states. Gantry is rated as a Primary Servicer by Standard & Poor’s and is one of a select few non-banking/non-insurance chartered companies with this designation. For more information, please visit gantryinc.com.

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