The bank truly does do business with all the usual suspects in the New York City area. Being the largest means having the luxury of choice and the ability to be extremely selective. Mr. Wiener and Michael Kaczynski, a senior vice president at the bank whose focus is construction loans, said that they’ll consider new clients but only after a thorough vetting process.
“We’re very selective—top tier,” Mr. Kaczynski explained. “We don’t go too far down market.”
“It’s really about your history,” Mr. Wiener interjected. “If it’s a non-recourse loan and you say, ‘Here are the keys,’ we’re o.k. with that. But if you had a guarantee on a deal and you didn’t honor it, we’re not o.k. with that.”
This rarely happens, said Mr. Wiener, who couldn’t recall a time when the bank had been burned on a deal in the tristate area.
The sheer volume of the bank’s real estate lending activity is a topic that Mr. Wiener revisits again weeks later, over chopped Caesar salad and sort-shell crabs at a Bobby Van’s steakhouse near his office. He explained that it had its advantages.
“One, you’re consistently in the market,” he said. “So even in the down times we were in the market. If you look at some other banks—take a look at JPMorgan. Sometimes they’re in real estate, sometimes they’re not. Consistently, Wells Fargo has always been in real estate, and being in the market and being such a large player in the market gives us the opportunity to actually pick who we want to lend to.”
Like many lenders, relationships and character are a key factor in the decision-making process for Mr. Wiener and his colleagues. In fact, many of the big name developers currently on the bank’s roster of clients followed him to Wachovia when he sold his company, American Property Financing, to the bank in May 2006. APF was focused on financing and loan servicing for the multifamily sector throughout the United States. And in New York it was the top multifamily lender. Mr. Wiener, as founder and chairman, had built it to such a size that its loan portfolio was more than $10 billion. By comparison, at Wells Fargo, the multifamily lending portfolio is at $70 billion.
When Wells Fargo agreed to buy Wachovia for $15.1 billion in 2008, many of Mr. Wiener’s high-end, top tier borrowers once again followed him.
“Wells had never done business with a lot of them,” he said. “I’d been their permanent lender, many of them, for a while. And now Wells is doing a ton of construction lending to them as well.” He said that he brought Two Trees Management Co. to Wells Fargo to do balance sheet lending after doing its permanent lending through Wachovia. The same for Related and Gotham and Glenwood.
This led to financing for projects like Two Tree’s Mercedes House at 555 West 53rd Street, done in conjunction with JPMorgan Chase and the New York State Housing Finance Agency. It also led to upcoming pools of financings—like developer Jeffrey Levine’s the Ohm at 312 11th Avenue in Chelsea—a $120 million hold, out of $191 million.
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