Northeast Bank simplifies complex CRE deals (Q&A)
Northeast Bank is growing its nationwide portfolio through three business lines: direct bridge lending, private lender finance, and secondary market loan acquisitions. Northeast Bank originates approximately $500 million of commercial real estate loans annually through these three verticals. For greater insight, the bank’s business development team answers questions related to Northeast’s niche in commercial real estate lending.
Q&A with Northeast Bank’s Business Development Team
Business development officers for Northeast Bank, Jon Levirne and Sol Garber, originally met as joint venture partners ten years ago at their respective credit funds supporting each firm’s origination and acquisition efforts. Levirne, Garber, and Tower bring seasoned experience to an exciting market segment in commercial real estate lending
Bridge loans require urgency and creativity. How long does it take to close?
Tim: Our flat organization and unique disciplines of valuation, credit underwriting, and in-house legal enable us to close within thirty days. We do not require outside credit approval and our credit meetings are on an as-required basis.
What level DSCR is required for Northeast Bank?
Jon: Our lending program specializes in complex transactions where foresight and a borrower’s ability to execute is more important than DSCR hurdles. To account for a lack of DSCR, Northeast Bank will protect itself and its borrower by appropriate reserve structuring at the loan level.
What is the competitive advantage for NEB?
Sol: Northeast Bank is in fact a Bank and has permanent capital where other bridge lenders are reliant on private investors and Wall Street lenders to support them. Northeast Bank lends in all cycles supporting its customer base.
What is NEB’s niche in lender finance?
Jon: Our portfolio finance business is geared toward mid-tier players that the money center banks and Wall Street firms will not focus on, primarily due to the size of their capital and asset base. Northeast Bank brings a focus to commercial real estate lending and does not have a “one size fits all” model. Each customer we work with has a specific need that our management team caters to.
Where is NEB winning business?
Tim: Northeast Bank captures a market segment that is too small for larger institutions to focus on and too complex for community and regional banks to underwrite. We lend nationally on most asset classes and can underwrite borrower, property, and legal issues.
Sol: Our Bank’s ability to underwrite all types of asset classes from the major collateral groups to specialty use such as golf courses and gas stations are what differentiates us. Additionally, our lender finance business is unique to a bank of our size.
Can you tell us more about your rates, loan sizes, and line capacities?
Sol: Our rates are as low as 6% and we typically target $1-15 million bridge loans. For the portfolio finance side, we can provide guidance lines up to $35 million.
How are you able to compete nationally across these verticals?
Sol: The management team has decades of national loan purchasing and bridge lending expertise with loans in over 40 states. Our business development team brings a unique perspective of not just lending in our backyard but lending in yours. Northeast Bank currently has offices in Boston, Portland, Maine, and New York City.
With a nationwide commercial real estate focus, Northeast Bank brings over 25 years of experience to get even the toughest deals done. We understand your business because we are in your business, and will work with you to create the right financing solution and close when you need to close.