Eastern Union reflects on hitting new high

It thrived in 2022 amid market turmoil

Eastern Union reflects on hitting new high

The commercial real estate sector was hit hard by rising interest rates last year as the Fed sought to stave off inflation. Eastern Union clearly didn’t get the memo, closing loans with a record-breaking number of lenders.

One of the nation’s largest commercial mortgage brokerages, Eastern Union closed loans with 180 lending institutions, the highest number of lenders in the firm’s 21-year history, the company’s president and CEO, Abe Bergman (pictured), told Mortgage Professional America. The milestones occurred during Bergman’s first full year of leadership as president and CEO, officials noted in a news advisory.

The company’s average loan size also grew by 24% over the prior year, company officials noted. Moreover, the size of the average loan put into process in 2022 increased by 4% over the 2021 average, officials added.

MPA spoke to Bergman for details. He said the record speaks to the company’s “never-ending” drive to find the right lender for any asset category. “We have, over the years, been a shop that has a very deep knowledge of real estate,” Bergman said. “We have a phenomenal staff that knows every commercial asset type. And we did have a heavy focus this year on doing deals that were real value add to the client,” he added, noting the company’s penchant for larger, complicated deals in a variety of sectors – healthcare, hospitality, mobile home parks and self-storage among them. “We’re seeing our book of business really expand in those areas.”

Fourth quarter proved especially challenging

There was some measure of rolling with the punches in light of market volatility, with the latter part of the year slowing down, he said. “Definitely the first three quarters of the year were more active, and some fluctuation toward the end of the year made people hold off a little bit,” he said. “But we’ve been able to not just expand in depth, but in width as well.”

Which isn’t to say that the last quarter wasn’t a doozy: “Definitely toward the end of the year, it’s no secret interest rates went up a lot and that created some friction on some deals where somebody goes into contract on a deal under certain assumptions expecting a certain level of financing, and the deal become more challenging,” Bergman said. “Overall, total transactions in the market definitely slowed down toward the end of the year. We monitor our numbers a lot and look at the percentage of deals we work on and percentages that close, and we haven’t seen a significant change in that.”

Challenges enhanced in the last quarter necessitated a nimble approach, he suggested: “That required a lot of maneuvering. And if a lender dropped out, finding a new lender to do it. If a deal needed a creative structure to it, we thought outside the box. That is a reality of the market right now.”

Retail makes a comeback

Emerging as a “pleasant surprise” was a resurgence in the retail sector, he noted: “To a certain degree, retail has become less challenging,” Bergman said. “Retail over the last couple of years has definitely been more of a challenge, but we did find, interestingly enough, it’s starting to come full circle. Even though people got a little bit nervous over retail, people have gotten into it.”

The growing appeal of retail is rooted in practicality, he suggested: “We still need retail,” he said succinctly. “Retail is not going away. You can’t get your haircut or nails done online. You still need commercial retail. People still want to go to the grocery store and pick their apples. We’ve gone through the pain, and people have adjusted their expectations and know what works. People are looking at deals and saying ‘look, this is an infill location, a location in a community that has a lot of people living there.”

Prominent deals ran the gamut

Among Eastern Union’s standout transactions last year:

  • Senior managing director Michael Muller arranged an $83.33-million bridge loan in support of the acquisition of The Halsten at Vinings Mountain, a 440-unit multifamily property in Atlanta.
  • Senior managing director Marc Tropp helped America’s Realty secure $73 million in financing to acquire one million square feet of retail space over a six-month period.
  • Ben Schwartz, a senior loan originator, closed a succession of 23 commercial mortgages valued at more than $100 million overall in a total of five states within a five-week period.  
  • And with two years on the job, 21-year-old Joseph Sasson – a commercial real estate loan originator – arranged for the $38.37-million refinancing of the Roseberry Apartments, a 285-unit multifamily property in Columbia, SC. 

Company officials noted that Eastern Union also experienced steady deal flow in 2022 from its healthcare group under the leadership of Nachum Soroka and Jacob Schonland. The company also launched a new hospitality division led by Charles Hoffman and established an investment sales office in New York City under Ben Weiss, who came to the company after an 18-year tenure with The Besen Group, a New York City-based investment sales firm.

Headquartered in New York City, Eastern Union is a national commercial real estate firm that provides both financing services and capital markets advisory services. It employs more than 90 real estate professionals.