Marcus & Millichap Capital Corporation Enters Strategic Alliance with M&T Realty Capital Corporation
As part of MMCC’s ongoing expansion, the alliance includes a preferred stock investment in M&T Realty Capital and the ability for MMCC to indemnify M&T Realty Capital for 50% of the credit risk losses for certain loans originated by MMCC through M&T Realty Capital’s Fannie Mae DUS platform. The strategic alliance will enable MMCC originators to access M&T Realty Capital’s streamlined underwriting and efficient transaction execution in this critical capital markets segment. Under the agreement, MMCC originators will continue to have the ability to clear the market on behalf of each client. Additionally, they will have access to M&T Realty Capital’s dedicated tools, resources, and expansive lending capacity, which are expected to significantly grow agency market share for MMCC’s sourcing business and M&T Realty Capital’s loan origination business.
In January 2021, MMCC named Evan Denner as Executive Vice President and Head of Business. Denner was instrumental in co-designing the partnership with Michael Berman, President and CEO of M&T Realty Capital, along with Beekman Advisors, who advised MMCC on the alliance. To further build MMCC’s ability to expand its clients’ access to agency financing, Paul Lewis, who spent nearly 20 years at Fannie Mae, joined in January. Lewis is a Senior Vice President and Director of Agency Programs.
Hessam Nadji, President and CEO of Marcus & Millichap stated: “MMCC is well positioned to work seamlessly with M&T Realty Capital to expand agency financing for our multifamily clients with better tools and resources for our originators. Marcus & Millichap is the leader in multifamily brokerage and will better integrate agency financing with our client value proposition. The investment in this strategic alliance and willingness to indemnify M&T RCC for credit risk losses is driven by the agencies’ historically strong multifamily loan performance and very low losses, coupled with significant upside in growing our internal financing capture rate and M&T’s unique ability to enhance our client services.”
MMCC closed $2.73 billion of multifamily financing in the first half of 2021 and with this alliance will become M&T Realty Capital’s largest origination partner by loan volume. Marcus & Millichap and its Institutional Property Advisors (IPA) division closed $12.97 billion of multifamily sales in the first half of 2021. “Marcus & Millichap and IPA have a stellar reputation in the industry and specifically in the multifamily real estate segment,” stated Berman. “We are proud to have Marcus & Millichap Capital Corporation as our strategic alliance partner. The synergies across our brands will enable us to provide substantial opportunities for clients.”
The alliance will allow both firms to provide clients with the most competitive capital markets solutions secured by multifamily properties throughout the United States. MMCC originators will work directly with M&T Realty Capital’s origination and credit teams creating an efficient, transparent, and ultra-competitive process for clients. Lewis and M&T Realty Capital’s Mark Gould will co-manage the venture.
“Marcus & Millichap Capital Corporation is firmly committed to this partnership,” said Denner. “We are a market leader providing multifamily capital markets solutions and this alliance provides us with another tool to continue to best serve our clients.”
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About Marcus & Millichap (NYSE: MMI)
With over 2,000 investment sales and financing professionals located throughout the United States and Canada, Marcus & Millichap is a leading specialist in commercial real estate investment sales, financing, research and advisory services. Founded in 1971, the firm closed 8,954 transactions in 2020 with a value of approximately $43 billion. Marcus & Millichap has perfected a powerful system for marketing properties that combines investment specialization, local market expertise, the industry’s most comprehensive research, state-of-the-art technology, and relationships with the largest pool of qualified investors. To learn more, please visit: www.MarcusMillichap.com.