As real estate lending picks up and sales of distressed properties continue to be the flavor of the day, Stamford-based private equity finance outfit Silo Financial has hit over $200 million in loan originations. Many of these loans went to small to middle market borrowers looking to take advantage of the current conditions, yet unable to get traditional financing.
Jonathan Daniel, founder, president and CEO of Silo, told The Mortgage Observer that the loans represent a diverse mix.
“We’re really a boutique private equity lender, so the types of borrowers we lend to are vast. It encompasses a lot of different borrowing needs,” Mr. Daniel said. “We’ve done everything from rehab construction projects recently to a lot of small business loans where they can’t get capital but they have real estate owned either in their business or personally and they use that as collateral for business financing.”
One recent loan—$6.2 million—will finance the development of adjacent two parcels in Soho, on the corner of Spring and Thompson streets.
“The group acquired two contiguous parcels—one is vacant and the other they’re vacating,” Mr. Daniel explained. “No bank would have financed that because there is no debt service coverage there, the majority of the site is vacant, but we were able to see the value in terms of the location and give them a bridge loan until they get their approvals.”
Half of the $200 million in loans issued was done in the past two years alone, Mr. Daniel pointed out. He said that note sales have fueled business, as have borrowers who have been able to buy their debt back at a discount.
“In today’s baking environment,” he said, “things that don’t qualify for traditional financing are a lot more numerous than they are in normal lending environments.”