NGKF’s Daniel Fromm Talks Multi-Housing Finance and Team Expansion
Daniel Fromm, who gave up law more than three years ago and joined Newmark (NMRK) Grubb Knight Frank’s capital markets group last summer, spoke to Commercial Observer about his transition and his team’s deeper push into multi-housing finance. The Brooklyn native also provided a rundown of the kinds of clients he and his colleagues are currently on assignments for.
Commercial Observer: Where did you grow up and graduate from?
Mr. Fromm: I spent my earlier years in Brooklyn and moved to Woodmere, N.Y., during high school. I received my bachelor’s degree from Queens College and J.D. from New York Law School.
How did you get started in debt and equity brokerage?
I met Jordan Roeschlaub, who leads our New York debt and structured finance team, through mutual friends years ago. At the time I was an attorney at a law firm. We spoke about some of the deals we were working on and immediately hit it off. We stayed in touch over the next year or so. At some point I mentioned I was looking to transition to the business side and he suggested I join his team. The rest is history.
What does your role at NGKF Capital Markets entail?
Our team raises and structures debt and equity for our clients’ real estate—be it an acquisition, refinancing of an existing asset or the development of a project. Although we focus on the Northeast, specifically New York, we follow our clients nationally. This can entail refinancing an office building in midtown Manhattan, structuring a construction loan in Hudson Yards or working with an institutional owner to recap a large multifamily portfolio in the Midwest. Every day is a challenge; it’s what makes my job so exciting.
What kind of commercial real estate deals do you and your team generally target?
Our team represents everyone from institutional clients to old-line real estate families. We have financed everything from ultra-luxury condos in Manhattan to a 1.3-million-square-foot office building and everything in between. With our recent acquisition of Apartment Realty Advisors, we have been executing more multihousing business than we have in the past and that’s been exciting, and we’ve expanded our team to have folks who specialize in this business. That said, our team’s capability and experience coupled with the NGKF platform is second to none. Clients hire us to run an institutional process where we create and use our volume and relationships to ultimately get the best terms for our clients.
What’s the most interesting deal you’ve closed this year that you can talk about?
Every deal I work on is interesting and has its own nuances. We have been working at a breakneck pace closing deals for our clients. We are currently in the market with a lot of volume. Right now we are in the “final round,” refinancing a loan on an office tower where the L.P. is a boxing legend. Earlier this week we closed on the financing of a multifamily property with Freddie Mac (FMCC) and structured a layer of preferred equity to fill out the capital stack. I am currently working on a cash-out refinance of a multifamily property in Queens and an acquisition loan for an office building in Greenwich, Conn. Without giving too many specifics, we are working on a few large acquisitions in Queens and the Financial District. As you can imagine, there is never a dull moment.
What are some of the biggest trends you are seeing in the New York and national markets right now?
On the debt side we are seeing continued liquidity and capital for strong borrowers. While rates have widened some in the past month it is still a great time to be a borrower.
Another very interesting trend is the entrance of alternative lenders or “nonbanks” into the lending space. Banks are now highly regulated and these alternative lenders are taking advantage of that, both by winning market share, as well as hiring away from the banks.
Finally, New York and the other gateway cities are experiencing an influx of both foreign and domestic capital. Be it the Sovereigns, high-net-worth investors or domestic pensions, there is an influx of capital that is driving down cap rates. However, there are still deals to be found for the creative investor. Because of compressed cap rates in the gateway cities, we are increasingly seeing investors searching for yield in secondary markets.