Residential projects accounted for 90% of Parkview’s lending volume in 2020
Residential transactions boosted mortgage lending activity Parkview Financial in 2020. The company closed a record loan volume last year, despite the pandemic, with a total of $ 600 million in construction loans. Residential projects, whether apartments or condominiums, generated 90% of this activity.
“While we lend in all real estate sectors, last year, multi-family homes represented the bulk of our fundraising activity. Apartment and condo projects represented approximately 90 percent of our loan volume ”, Paul Rahimian, CEO of Parkview Financial, told GlobeSt.com. “The majority of our sponsors in 2020 were small to mid-sized developers who were looking to secure funding quickly and have hands-on support for the entire lending process. The theme “time is money” was pretty consistent feedback we heard from them. They had to launch their projects as quickly as possible in order to capture their return on investment. “
The focus on residential reflects demand more than strategic change. In terms of strategy, Rahimian said the firm has tried to ignore short-term trends. “We frequently talk about pandemic strategy as some notable market dynamics have emerged, but we question the longevity of many of the trends that make the headlines,” he says. “There are certainly some useful data points for lenders right now, but there is also a lot of market noise that we need to be careful not to get into our decision making.”
Instead of changing strategy, the company focused on its core lending principles. “From a business perspective, we worked to block out external noise in 2020 and instead spent the year really internalizing who we are as an organization and what we stand for,” adds Rahimian. “The result came out of last year with a stronger sense of purpose and a team united around our core values, not to mention a record year and a fourth quarter.”
Parkview is not alone. Private lenders saw an influx of activity during the pandemic, as more traditional lenders tightened lending standards and pulled out of the market. “As a consensus began to form and really differentiate between safe and risky assets in today’s environment, it was private lenders like us who were the first to market,” says Rahimian. “Strong conviction, which at times like this goes against the grain, and discretionary capital able to act on that belief are the hallmarks of non-traditional lenders who are able to provide cost-effective solutions to borrowers. “
According to Rahimian, banks generally do not have the flexibility to react to changing loan conditions, thus opening up opportunities for other operators. “Structurally, banks face economic headwinds like a locomotive on a fixed track and can speed up or slow down their business along established and regulated tracks,” says Rahimian. “We can quickly change course according to our convictions, a luxury that structurally the banks do not afford. The fourth quarter was a record quarter for non-bank lenders to whom I credit the opening of construction finance capital markets and the return of competition in a very troubled landscape that is in desperate need of the vitality that it needs. ‘offers competition.
Non-bank lenders were not the only providers of capital to see their activity increase. Everyone benefited from it, ”says Rahimian. “The borrowers and in particular the economy and the communities in which these loan dollars have been paid. Lenders like Parkview provide fixed yield loans, but the economic activity generated by a loan commitment is exponential. It is very rewarding to play a role in getting Americans back to work in these difficult times. “