Prudential Mortgage Capital Provides $15.2B in Financing Globally in 2014

by Jeff Shaw

NEWARK, N.J. — Prudential Mortgage Capital Co. (PMCC) provided $15.2 billion in financing to the commercial real estate industry globally in 2014, exceeding expectations but down slightly from $15.8 billion in 2013. Despite the slight pullback overall, the company provided more than $3 billion in conventional agency loans in 2014, the highest production volume in the firm’s history.

PMCC — the commercial mortgage lending arm of Newark-based Prudential Financial Inc. (NYSE: PRU) — unveiled the results Tuesday during the Mortgage Bankers Association’s 2015 Commercial Real Estate Finance (CREF)/Multifamily Housing Convention & Expo at the Manchester Grand Hyatt in San Diego.

In addition to achieving a record year for agency lending in 2014, PMCC reported strong production in general account volume and CMBS transactions. The company — which exceeded its projected goal of $14 billion for 2014 — has as much as $15 billion available for financing in 2015.

Among the highlights for PMCC in 2014:

  • Portfolio lending in the U.S. totaled $7.9 billion, while portfolio lending internationally (Japan, the United Kingdom and the rest of Europe) totaled $700 million.
  • CMBS originations on behalf of PMCC’s Liberty Island conduit program reached nearly $900 million.
  • International assets under management grew to more than $2.1 billion.

“Our production in 2014 showcases the continued positive impact of our expanding origination platform in the U.S. and internationally to support increased demand from our investor clients, the government-sponsored enterprises and CMBS investors,” said David Durning, CEO of PMCC in a press release.

“Looking forward, we see attractive opportunities to expand agency loan production by growing our Agency Gateway Program production from last year’s record volume of over $200 million, growing CMBS production to meet increased borrower demand, and expanding international lending activity to Australia, Canada and new countries in Europe,” added Durning.

Multifamily Is King

“We had a record multifamily production at $7 billion [in 2014], which included agency lending and lending for our general account,” said Marcia Diaz, managing director and head of originations for PMCC, during an interview with ReBusinessOnline at the MBA Convention. Diaz said that there is plenty of activity occurring in the multifamily sector to keep lenders busy for the foreseeable future.

“From a real estate supply perspective, there are a lot of apartments still under construction. There is just going to be a lot of new product coming on line that needs to get financed,” said Diaz. She expects property and portfolio sales will continue at a robust pace in the near term, which will fuel acquisition financing and refinancing activity.

But the good times can’t last forever, right?

“Our platform is uniquely set up to hit whatever the cycle is in the market and serve the multifamily universe,” said Diaz. “So, we’ve got the general account. We’ve got CMBS. We’ve got market-rate agencies Fannie and Freddie as well as FHA. Whatever you are asking for, whatever your property type is, whatever part of the country you are in, if you are in a primary or secondary market, our platform is designed to be able to service that.”

PMCC is a national full-service, commercial and multifamily mortgage finance business with more than $82 billion in assets under management and administration as of Sept. 30, 2014. The company maintains a loan-servicing portfolio that totaled approximately $79.7 billion as of Sept. 30, 2014.

— Matt Valley

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