Grandbridge to Acquire Houston Commercial Mortgage Banker

Grandbridge Real Estate Capital LLC, the commercial mortgage banking subsidiary of Winston-Salem, N.C.-based Branch Banking and Trust Co. (BBT), on Monday announced it will buy Houston-based commercial mortgage banking firm Live Oak Capital Ltd., which specializes in debt and equity placement and loan servicing for the commercial real estate industry. The acquisition is expected to close by the end of the month under undisclosed terms. Charlotte-based Grandbridge, with a servicing portfolio of $22.5 billion, represents 100 capital providers. With $137 billion in assets, its parent company BB&T Corp. operates more than 1,500 financial centers in 11 states and Washington, D.C. Privately-owned Live Oak Capital, which serves as a mortgage loan correspondent for 20 institutional lenders, has closed more than $7 billion in commercial real estate capital transactions since being founded in 2000. “This is an excellent growth opportunity for our firm, especially considering the tremendous benefit we’ll gain from our association with BB&T and its strong balance sheet and investment ratings,” said Live Oak partner John Fenoglio. “In all, we’ll gain an expanded delivery for our investment partners and greater access to capital markets and proprietary lending services.” Visit  www.bbt.com and www.liveoakcapital.net for more information. The commercial lending piece of the pie The acquisition represents the merging of two large players in the commercial mortgage banking industry, a strong portion of the financial market, according to recent research. Commercial lending now accounts for just under half of financial institutions’ loan portfolios, according to survey results released Monday by Wolters Kluwer Financial Services, a Minneapolis-based provider of compliance and risk-management solutions. Of approximately 700 financial institutions that responded to a recent survey conducted in August 2008, 98 percent reported they are offering their customers commercial loans, including both commercial real estate and commercial and industrial loans. On average, commercial loans represented just under half — 46 percent — of respondents’ loan portfolios. “While those numbers may have changed because of recent credit market conditions, they do illustrate the overall importance of commercial lending as a line of business for financial institutions and as a significant percentage of their loan portfolios,” said Ken Newton, executive vice president of banking for Wolters Kluwer. Eighty-six percent of survey respondents were small-to-mid-sized banks and savings and loans institutions with less than $1 billion in assets, according to Wolters Kluwer spokesman Charles Miller. Write to Diana Golobay at [email protected]. Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.