Broadmark Enters Into Merger With Honolulu-Based Trinity
Seattle-based Broadmark has entered into a merger agreement with Trinity Merger Corp., based in Honolulu, to create a mortgage real estate investment trust company called Broadmark Realty Capital Inc. It will have an expected value of $1.5B.
Trinity will acquire Broadmark for $1.2B, which will include 92%, or $1.1B, of Broadmark Realty stock and 8%, or $98M, in cash. The cash will be paid to Broadmark’s equity owners and the rest will be issued in stock.
The new company created by the merger will be called Broadmark Realty Capital and will be based in Maryland and taxed as a REIT. Broadmark Realty will apply to have its listing on the New York Stock Exchange with a new ticker symbol.
Broadmark was founded in 2010 and provides financing for national real estate investors and developers by originating short-term, first deed of trust mortgages. In March 2019, the firm had about $992.2M in committed loans. Broadmark has maintained a conservative lending approach, with strict underwriting and high collateral requirements.
Pyatt Broadmark Management President Jeffrey B. Pyatt will become the CEO of Broadmark Realty, and Broadmark founder and President Joseph L. Schocken will become the chairman of the board of directors. The rest of the Broadmark team will continue in their current roles.
"Joining forces makes sense for a number of reasons," Pyatt told Bisnow. "We are able to combine our collective real estate experience and longstanding industry relationships to further enhance the business and fuel growth opportunities."
Pyatt added that the newly formed firm will be able to capitalize on the strong nationwide demand for flexible real estate financing options.
Trinity Merger Corp. is a Honolulu-based special purpose acquisition company that conducts mergers, acquires assets, purchases stock and conducts business reorganizations.
Broadmark is located in downtown Seattle at 1800 One Union Square 600 University St.