Presented By: Meridian Capital Group
The Year of the Deal: Drew Anderman’s Team at Meridian Closed $3 Billion in 2017
It’s hard to determine the exact highlights of a year like the one Drew Anderman and his team at Meridian Capital Group had in 2017, when a slew of impressive deals led them to over $3 billion in business. But with so many significant deals over a wide range of property types, several stand out not just as great achievements on their own, but as bellwethers for more of the same in 2018.
Reflecting on a complex $126 million deal in northern New Jersey in 2017 for a class-A multifamily high rise that, when it closed, didn’t have a certificate of occupancy, Anderman, a 20-year veteran of commercial real estate finance, sees it as a potential model for more to come.
“We were brought into the deal when it was probably 85 percent complete,” he said. “We were hired to replace the existing lender with a new lender so that the sponsor could complete a buyout of his partners and complete the project,” he said.
“It’s difficult to replace one construction lender with another mid-stream. We were able to structure a deal with a lender that wanted to start a relationship with the sponsor, knew the market, and was comfortable taking the risk that the certificate of occupancy would come in a timely fashion. It was a very challenging deal, it took a lot of work, but we knew we could get it done.”
The New Jersey transaction is also an example of Anderman’s work with transitional properties, another promising area for him and the Meridian team in 2018.
“These deals require a lot of structure, a lot of thought, and a lot of analysis. They’re very hard to complete. Deals that could use our expertise to be recapitalized will be a theme for us in 2018.”
Anderman is also excited about avenues to overseas capital he initiated in 2017, having just returned from Korea before the New Year.
“We met with 20 leading insurance companies, pension funds, and credit unions,” Anderman said. “One thing we’re working on for 2018 is matching up overseas capital sources that want to invest in or lend on high-quality U.S. assets in seven or eight major cities. One of my associates just did a high-profile deal on Fifth Avenue where a Korean company did an $80 million mezzanine loan on top of the senior. We’re making a lot of inroads there.”
Agency loans were also a focus for Anderman’s team in 2017, and will continue to be in the year ahead.
“We have, and will continue to have, a robust pipeline of agency business,” said Anderman, a 20-year veteran of commercial real estate finance.
“We’re currently working on a $220 million acquisition loan for a portfolio of 25 properties totaling about 4,000 units spread across five states in the Midwest and Mid-Atlantic, which is primarily affordable, Section 8 housing. We will likely finance all or a large part of that portfolio with the agencies. Our business plan for 2018 includes maximizing our agency origination as the agencies continue to expand their offerings.”
His team also saw great success with construction loans over the past year.
“We were involved in one of the larger construction loans in the country in 2017,” said Anderman, referring to a $1.25 billion construction loan he secured for a mixed-use property on Eleventh Avenue in Manhattan, which will feature condominiums, retail, and a five-star hotel. “It was a complex deal funded by an overseas lender.”
This, in addition to a $305 million construction loan for a condominium and retail complex in Lower Manhattan, and an $85 million loan for condominiums on the Upper East Side, made Meridian one of the premier firms for construction loans in 2017. Anderman looks forward to a repeat performance in 2018.
Geographically, while Anderman’s team has closed loans from coast to coast, the South Florida market was particularly active in 2017 and he predicts it will remain so.
“We’re working on a $500 million construction loan for a 1,500-room hotel and convention center in downtown Miami. We have an exclusive,” Anderman said.
“It would be one of the largest construction loans in 2018, and one of the larger construction loans in South Florida, for sure. It’s a very complex deal, and we’re working on financing it as we speak.”
Anderman’s optimism for 2018 comes not just on the back of his 2017 success, but also thanks to a wealth of his own experience and a team that’s executed so many different types of challenging deals throughout their respective careers.
“My team has a diverse combination of backgrounds. We come from Wall Street to developers, and we understand different aspects of real estate,” he said.
“But also, our success comes from the time and effort we spend understanding what a deal is about before agreeing to take it on. When we put together a financing memorandum, it’s a detailed, thoughtful analysis. We have a meticulous way we approach lenders and what we say to get their attention.”