Market Insights

Alternative Lenders Take Big Chunk of L.A. Lending Pie

 

Led by Bank of America, the top commercial mortgage loan originator in Los Angeles in the first six months of this year, U.S. national lenders were responsible for half the loans originated by the market’s top 20 originators, CrediFi found in its Los Angeles Lending Spotlight for H1 2017.

At first glance, that doesn’t look much different from other top markets, like New York and Chicago, where national banks also led the league tables. But what’s interesting is that in L.A. the national lenders were followed by alternative lenders, defined here as non-bank lenders excluding insurance and pension companies.

 

 

These non-bank lenders were led by CRE finance company Walker & Dunlop, followed by commercial mortgage financing provider Ladder Capital and North America Sekisui (NASH Financing), a Virginia-based subsidiary of Japanese builder and developer Sekisui House. The alternative lenders were responsible for 17% of the loans originated by L.A.’s top 20 originators.

Compare that to other major markets, where the second-largest lending groups had shares of over 20%. That didn’t leave much pie to split among the rest, which largely claimed shares under 10%.

In the City of Angels, however, the remaining lender groups each got a pretty respectable piece of the H1 business originated by the largest lenders. And those pieces were pretty evenly cut: Out-of-state-regional banks had 11%, and California banks and foreign banks each had 10%.

While pension and insurance companies played a big role in Boston lending in the first half of the year, they took just 2% of the pie in Los Angeles, due to lending by the Teachers Insurance & Annuities Association of America, or TIAA.

To download the full Los Angeles Lending Spotlight for H1 2017, click here.

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