The Firm You Should Be Watching In South Florida
Meridian Capital Group, America’s most active debt broker, has surged amidst the rebuilding Florida market.
"Our office has gone through a major transformation," Meridian’s Israel Schubert, who heads the company’s Boca Raton office, tells Bisnow. “Our Boca office has more than 15 loan officers. The South Florida market has been a solid growth story for Meridian as we’ve been able to expand our offering of commercial loan placement and advisory services.”
"We've demonstrated time and time again just what Meridian’s thoughtful approach and unique relationships can achieve for borrowers," Israel continues, "even in a market like this where lenders are retracting due to concerns over the implementation of new regulations."
He points out that by leveraging the firm’s unique relationships with lenders—which have been built over the company’s 25-year history—Meridian remains able to provide highly competitive terms for its clients.
"Lenders are starting to pull back a bit in the Florida market,” says Meridian managing director Noam Kaminetzky, who is based in the Boca office.
Noam echoes that the tightening market requires potential borrowers to choose a well-entrenched broker.
"Lenders have become increasingly particular about the construction loans they are willing to take on as well as how they lend on hospitality assets,” he adds.
Meridian has been expanding in Florida organically and by adding new talent. Several team members who were based in the company’s New York and New Jersey offices have followed the birds south to Florida, and brought their relationships to Northeast lenders with them.
“This influx of talent and lenders provides us with more arrows in our quiver and allows us to continue to offer non-recourse balance sheet loans at 75% loan-to-value ratios even when the local market is tightening," Boca-based VP Eric Trombly says.
Despite a challenging climate, Meridian's relationships with banks, agency lenders, CMBS shops, life insurance companies and specialty lenders allow property owners to continue growing in the Florida market.
Aryeh Meiteles, a VP in Meridian’s Boca office, highlighted a transaction he is working on, where a Miami-based bank quoted a 10-year loan with full-term, interest-only payments and a stepdown prepayment penalty at a low LTV for a client’s well-leased retail property in Miami.
“Our client was adamant about a 10-year term, but did not want the restrictive prepayment structure of a CMBS loan, and Meridian was able to deliver several balance sheet quotes and this one stood out because of the interest-only,” he says.
Max Beyderman, a SVP and recent transplant from Meridian's New Jersey office, explained that Meridian can also generate interest in value-add transactions.
“I’m in the market with an acquisition loan for a half-vacant office building,” Max says. "Generally speaking, this is not a bread-and-butter bank deal, but we’ve marketed the opportunity correctly and I have a term sheet for a five-year, fixed-rate loan with two years of interest-only payments at normal commercial interest rate; no upcharge for the vacancy and lease-up risk."
"We have a very good retention rate of the borrowers that we close with," says Noam. "We are in a service business, and our team can quickly underwrite a deal and present a variety of alternatives to owners so they understand where the market is when making a decision. I recently closed my fifth deal for one client and it's engaged us to work on several additional projects."
The firm helped TJAC Development acquire the City National Bank Plaza in Boca Raton by arranging $31.5M of financing for the $40M purchase. The firm also arranged nearly $24M in permanent financing for the purchase, renovation, and partial buyout of a rental condo complex in Tamarac.
“The borrower was surprised to find that a cash-out refinance would work,” he says. “Meridian negotiated a loan with a Northeast-based balance sheet lender that allowed the client to pay off its existing mortgage and simultaneously upgrade the apartments. The refinance alleviated cash-flow constraints and allowed the borrower to access further value in the investment.”
Meridian is still working around the clock to become the dominant name in Florida real estate financing. It offers owners, developers and investors a distinct advantage when it comes to negotiating financing.
To learn more about this Bisnow partner, click here.