Walker & Dunlop Continues Tech Expansion With TapCap Acquisition

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Commercial real estate financier Walker & Dunlop (W&D) has continued its recent campaign of M&A activity with its purchase of financial technology company, TapCap, W&D announced today. 

Over the last 18 months, W&D has made a series of moves to expand its traditional commercial real estate finance capabilities, while separately acquiring or partnering with financial technology companies to help automate and streamline its internal processes. 

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The addition of TapCap marks yet another move in the firm’s five-year growth strategy, this time to help further automate loan application and origination through a proprietary software that provides real-time quotes for multifamily loans, with the goal of making the borrower’s experience easier and more transparent. The purchase is seen as a move to help it reach its ambitious goals in small balance loan origination.

“We’ve been investing heavily this year in loan origination talent to scale our small loan originations to $5 billion by 2025,” said Alison Williams, who serves as W&D’s small balance lending chief production officer. “But, penetrating the small balance lending market requires cutting-edge technology to reduce costs, while providing an exceptional customer experience. Adding TapCap’s technology will make our lending processes more transparent, efficient, and scalable — and accelerate our growth towards $5 billion.”

TapCap founder and CEO Zac Rosenberg broke away from his family’s company, Greystone, about two years ago to launch the fintech startup. He had spent the previous four years as a director, leading the buildout of different online underwriting and origination tools in Greystone Labs, the firm’s tech innovation division. Rosenberg will stay on in a leadership position within W&D’s technology group.

“TapCap is all about efficiency, and how to remove friction from the borrower experience, while reducing underwriting and closing costs on loans,” said W&D Chief Technology Officer Aaron Perlis

This addition just adds to W&D’s recent efforts to expand its artificial intelligence and machine-learning prowess in the areas of valuation, underwriting and origination. Two years ago, W&D acquired Enodo, a business-to-consumer software company that specializes in using AI and machine learning in underwriting. And, in January 2020, it partnered with tech company GeoPhy to launch a system called Apprise, which aims to streamline multifamily valuations.

Perlis said that the “acquisition of Enodo in 2019 and our joint venture with GeoPhy have driven [our] AI and machine-learning capabilities to new levels, resulting in dramatic growth in new customers.” 

W&D has also been expanding elsewhere within the company. The same month it partnered with GeoPhy, it created a New York City-based capital debt and equity capital markets division with its acquisition of AKS Capital Partners. And, last month, it bought housing research and advisory firm Zelman & Associates