Capital One Financial Corp. (COF) has agreed to buy Beech Street Capital, a mortgage firm that specializes in government-insured and multifamily loans.
The purchase would make Capital One among the five largest originators of multifamily loans in the country, the McLean, Va., company said Friday. The $297 billion-asset company did not disclose the price it expects to pay for Beech Street, which originates and services Fannie Mae, Freddie Mac and multifamily commercial real estate loans.
The privately owned Beech Street, based in Bethesda, Md., has a servicing portfolio of $10 billion and originated $4 billion in loans in 2012, Capital One said. It has ten offices and operates across the country.
"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," said Rick Lyon, Capital One's head of commercial real estate lending.
In recent years, Capital One has been diversifying away from its core business as a credit card issuer. Last year it bought ING Direct, as well as HSBC's U.S. credit card business. This year, it has been expanding its equipment-finance operations.