The New Math: Michael Lehrman on his plan to introduce derivatives into New York City’s otherwise staid rental market.
By Daniel Geiger May 29, 2012 10:00 am
reprintsBy the 2000s, he had become one of the most prominent professionals in the lending business, leading Credit Suisse (CS)’s huge CMBS origination team with Mr. Orso. When the downturn hit however, Credit Suisse shed virtually its whole securitization department, and Mr. Lehrman moved to Cantor Fitzgerald with a select group of former Credit Suisse colleagues, including Mr. Orso and Michael May. The move stemmed largely from Mr. Lehrman’s friendship with Mr. Lutnick. The two had become acquainted years ago, he said, because they both have sons who are the same age and go to school together.
“Working with friends is the way I do business,” Mr. Lehrman said. “When you work with your friends, the great days are out of this world and the bad days, well, you get through them a lot better.”
While Cantor sought to become the securitization originator of choice when the CMBS market returned in 2010, Mr. Lehrman saw a need for a more immediate financing source. “There’s $1.5 trillion of loans rolling,” he said.
He moved over to BGC to tap its suite of connections in the world of banking and finance, what were the new balance sheet lenders who would be pouring capital into real estate deals and refinance transactions.
It’s a business that Mr. Lehrman is still clearly building. This week, BGC announced that it had hired a former high-power Nomura lending team led by the executive Mark Brown to join the company.
Credit Mr. Lehrman for branching beyond the lending business into other real estate services lines. Mr. Lehrman said that he views the major leasing and investment sales brokerage powers in the market as lacking the kind of financing business BGC has.
“Look at a firm like Eastdil: it’s plugged into the lending markets in an incredible way with its parent Wells Fargo (WFC) and it’s a great broker of financing deals. But would you do leasing with them?” he asked.
“That’s what we’re going to be. I’m most excited about taking everything that we’ve built on the capital-markets front and integrating that across the combined platform. There is tremendous overlap. We’re going to help a real estate owner acquire an asset, finance that asset, lease it up and sell it for them.”
Dgeiger@observer.com
