The PNC Financial Services Group, Inc., has signed a definitive agreement to acquire ARCS Commercial Mortgage, the No. 1 Fannie Mae lender for the last several years.
For PNC, which is not a Fannie Mae Delegated Underwriting and Servicing (DUS) lender, the deal will significantly bolster its agency lending business and complement its work as a Freddie Mac Program Plus and FHA Multifamily Accelerated Processing lender.
This latest consolidation is another sign of the need for lenders to offer a full spectrum of products to compete effectively in today’s aggressive lending environment. “The industry has changed,” said Howard Levine, founder and CEO of Calabasas Hills, Calif.-based ARCS.
“Being just a Fannie Mae DUS lender without the banking balance sheet and the conduit capability, we were at a disadvantage compared to most DUS lenders that have sold off to major financial institutions.
“We’re very excited that now we’re able to offer all the products that our customers require,” said Levine, who signed a two-year contract to stay on as a senior adviser to help ease the transition.
With the transaction, PNC is hoping to expand its reach. While both companies are Freddie Mac Program Plus lenders, PNC’s license covers California and Hawaii, and ARCS’ license covers New York, New Jersey, and Connecticut.
ARCS will be the Fannie Mae national agency lending platform for PNC, and the ARCS brand will stay in place until the end of the year, at which time the company will re-evaluate its marketing.
Financial terms of the deal, which is expected to close in the third quarter, were not disclosed. Beekman Advisors acted as financial adviser to ARCS on the transaction. ARCS, which has 10 origination offices, originated more than $2.1 billion of loans in 2006, and services approximately $13 billion of loans.
$400 Million Texas Portfolio on the Sales Block
Internacional Realty is selling a 3,937-unit, 13-property multifamily portfolio valued at more than $400 million. The collection of Dallas, Houston, and San Antonio properties is not priced. Apartment Realty Advisors is marketing the portfolio.
The portfolio of assets is 94 percent occupied. Bids for individual properties will be considered, but the owner prefers to sell the entire package for one price. The average unit size is 895 square feet, and the monthly average rent is $1,034. The call for offers is June 22.
The seven properties in Houston included in the offering range in size from the 210-unit Beverly Wilshire at 7550 Wilshire Place Drive to the 356-unit Calais at Courtlandt Square at 3210 Louisiana Street.
In the Dallas/Fort Worth area, Internacional Realty is selling the 280-unit Cambria at Coyote Ridge in Carrollton, Texas; the 582-unit Gardens at Vail in Dallas; the 378-unit San Simon in Irving, Texas; and the 216-unit Summerbrook in Fort Worth.
The San Antonio metro properties are the 314-unit Palermo in San Antonio and the 204-unit Westshore Colony in New Braunfels, Texas.