Financial services company A10 Capital has a launched a lending group to originate first mortgage commercial real estate loans and provide investors financing for commercial real estate-backed distressed debt purchases. “We’re in a position to fill a void between conventional lending sources and hard money lenders,” says Jerry Dunn, chief operating officer of A10 Capital.
The shutdown of the commercial mortgage backed securities market, along with tightening standards by banks and life insurance companies, have sharply “reduced the amount of financing available,” Dunn notes. A10 has begun originating “selective loans, with a significant amount in process,” backed by more than $100 million in “dry powder.” The one-to-two year loans, mainly to small investors, are “a little more expensive” than conventional loans but better priced than hard money loans. “We don’t think the market has bottomed out yet in commercial real estate,” says Dunn, “but it’s a clearer picture than it was after Lehman failed."