Signature Bank's former head of commercial real estate lending is moving to Douglas Eisenberg's A&E Real Estate to launch a lending platform.
Joseph Fingerman will lead a team of about 20 people, including former Signature employees. The new platform, A&E Real Estate Finance, will provide financing for multifamily housing across New York City.
A&E, one of the city's largest apartment complex owners, will join other major real estate developers such as Silverstein and Naftali in adding a lending division.
Rising interest rates and a lack of alternatives to 421-a tax breaks have left few opportunities for real estate developers to build or acquire properties. Debt offerings are one of the few avenues left to achieve returns above Treasury yields.
A&E plans to launch its lending business in the coming months, focusing on first-lien loans, though Eisenberg said it has the option to offer other loans depending on borrowers' needs.
“We are a very well-funded company,” Eisenberg said. “We have the ability to do as much or as little as we want.”
A&E plans to support its lending business with existing capital and funding from institutional investors. The company hopes to start with small mortgages in New York City before expanding beyond the five boroughs.
“This is a response to the withdrawal of many banks and lenders from the New York City market as a result of both the lending environment and the political events of the past few years,” Eisenberg said. “We have a fundamental belief that New York isn't going anywhere.”
A&E, which manages more than 20,000 properties, has the ability to buy bad loans and take over the underlying properties, but Eisenberg said that's not the company's strategy: asset management and lending will be two separate entities.
“They're completely separate things,” Eisenberg said. “One has nothing to do with the other.”
Eisenberg said the company is open to lending to rent-stabilized properties, but changes to New York state rent laws in 2019 have caused many lenders to back away from lending to such properties.
Signature Bank was one of the largest lenders of rent-stabilized properties until regulators seized it last year after depositors panicked and withdrew their money. Mr. Fingerman and his team were fired shortly thereafter.
Fingerman joined Signature in 2007 and previously worked at North Fork Bank in real estate lending.
A&E's portfolio has grown from a single 49-unit building in Fort Greene in 2011 to more than 20,000 apartments across New York City. In late 2022, CEO James Patchett, who had been running the New York City Economic Development Corporation, left A&E after less than two years to become a partner at McKinsey, with Eisenberg returning to run the business.
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