Meridian Capital Group and Barings have announced a partnership to create an agency lending platform. David Brickman, former CEO of Freddie Mac, will lead the new platform as its CEO.
The joint venture will acquire the assets and liabilities for Barings Multifamily Capital (BMC), including its licenses to participate in various lending programs, and operate the agency loan origination and servicing businesses conducted by BMC under new ownership, leadership, and branding. The transaction is expected to close after receiving federal government-sponsored enterprise (GSE) approvals.
The newly created platform will operate as a standalone business under its own name and branding, which will be announced prior to the transaction closing. Meridian will own a majority of the platform, and its ownership is subject to increase over time. Brickman will lead the joint venture’s dedicated management team, and the joint venture will be governed by a board of directors that is majority controlled by Meridian.
Meridian also has announced a partnership with investment funds managed by Stone Point Capital to fuel the company’s continued growth as it looks ahead to product and geographic expansion.
According to Meridian, the agency lending partnership with Barings, the addition of Brickman, and the partnership with Stone Point Capital come at a pivotal time in its 30-year history. In the coming years, Meridian will focus on developing the agency lending joint venture, growing its core mortgage brokerage business on a national scale, expanding its investment sales and retail leasing products to key markets, and growing other lines of business.
“We are thrilled to be embarking on this new chapter,” said Meridian chairman and CEO Ralph Herzka. “Our partnership with Barings will enable us to join forces with one of the world’s leasing asset managers and reintroduce Meridian to the direct agency lending arena. The addition of David Brickman to our team will mean that we are working alongside one of the most prominent multifamily experts in the country. David did not just preside over a remarkable period of expansion at Freddie Mac, he did so through the type of innovation, creativity, and ingenuity that are critical to thriving in today’s marketplace.”
In addition to heading the new agency joint venture, Brickman will assume the role of executive chairman of Meridian and senior advisor to Stone Point Capital. He will work alongside Herzka and Meridian president Yoni Goodman to chart the strategic course of the firm, expand product offerings, and continue to grow Meridian on a national scale. Brickman spent most of his career at Freddie Mac, working in and leading the multifamily business, where he presided over a substantial period of growth—raising annual production from $16 billion in 2010 to almost $80 billion in 2018.
Subject to regulatory approval, the agency lending joint venture, through a wholly owned subsidiary, will participate in the Fannie Mae Delegated Servicing and Underwriting program, the Freddie Mac Optigo network, and Federal Housing Administration and Ginnie Mae multifamily lending programs. In addition, the new business will service commercial and multifamily loans for Barings’ parent company, MassMutual, and other lenders. Meridian will originate multifamily loans on behalf of the venture on a nonexclusive basis and will continue to originate for banks, agency lenders, and other financing sources as it has done in the past.
“Barings continues to build out its real estate debt capabilities, and our joint venture with Meridian extends our reach to a much broader market,” said Eric Lloyd, head of global private assets at Barings. “This includes markets that complement our existing institutional commercial mortgage lending business.”