Capital One signed an agreement on Friday to purchase Beech Street Capital, a privately-held loan originator and servicer for the Federal Housing Administration and government mortgage giants Fannie Mae and Freddie Mac.
“As we continue to expand our product capabilities and services for clients across our growing Commercial Banking business, this acquisition is a logical expansion of our already substantial commitment to the multifamily sector,” Michael Slocum, the president of Capital One’s commercial banking group, said. “The combination of Capital One’s multifamily business and Beech Street will make us a top 5 national multifamily originator and one of the few institutions in the US capable of offering clients a one-stop banking solution encompassing a full range of banking services.”
Beech Street handles multifamily commercial real estate loans and is one of the largest providers of government-insured mortgages through Fannie, Freddie and the FHA’s multifamily lending programs.
Last year, the firm originated approximately $4 billion in loans, making it the sixth largest originator in the country. It services a loan portfolio of approximately $10 billion.
“The addition of Beech Street strengthens our multifamily business, provides a national presence, and enables us to meet the needs of clients in the multifamily sector with a complete set of banking services that includes agency program loans, bank balance sheet loans, treasury services, and capital markets solutions,” Rick Lyon, the head of commercial real estate banking at Capital One, said. “We have great respect for the experience, leadership, and unique expertise Beech Street founder and CEO Grace Huebscher and her exceptional management team bring to Capital One. Like us, Grace and team are passionate about the client…We believe the market will see significant benefits from this powerful combination of industry-leading expertise, greater resources, and expanded capabilities.”
Beech Street, which is headquartered in Maryland, has 10 offices nationwide. Together with Capital One, the company will have national portfolio loan servicing and origination capabilities.