Time for a semi-annual ‘GMC by the Numbers’ update + a ‘Word from the President’ for Q2 of 2024! Graham Mortgage has been a private lender for over 40 years. We pride ourselves on being the consistent and reliable source of capital that brings confidence to your choice. This has been true since 1978.
• 100+ years of combined underwriting and investor relations experience.
• In the last 10 years: Over $500 million of total production in loans from 2013-2023.
• In 2024: Over $75 million funded in more than 23 loans to date.
• Multifamily: Over $125 million funded since 2008.
• Retail: Over $89 million funded since 2008.
• 7 dedicated staff for production, closing, and servicing.
• Missed closings: 0 is always the goal.

Please keep GrahamMortgage in mind for bridge loans, small construction / development loans, and singletenant credit lease construction financing.

Onto the update from Dean:

Like many of us, I am a sports fan!  I grew up in a house with my Mom and Grandmother as driving forces behind the love of sports.  I can still hear the longtime Yankee announcer, Phil Rizzuto, yelling  “Holy Cow” at a crucial moment!! The first half of 2024 deserves a full Phil Rizzuto HOLY COW!

DFW has continued on a Holy Cow trajectory for some time now. It is difficult to see it slowing down as we continue to attract growth and build wealth here. The momentum is reflected in our local sports teams with a  World Series championship, an NBA finals, the emergence of a top tier hockey team, and, yes, an always competitive NFL experience. DFW remains a shining example of a place where opportunity abounds. We have the resources to capitalize on those opportunities as a world class metro area.  

How does GMC participate in this success?  We have faith in our local economy and in commercial real estate as a safe and lucrative asset class. We have added to our capital base with the support of valued existing investors and new investors.  The expanded capacity enables us to fund larger and more loans.  Our brand as reliable and efficient instills confidence in the uncertain environment for borrowers. These have all led to record loan volume.

The current state of the lending ecosystem provides opportunity for GMC.  Most of us in the financial world talk about the fragile state of the banks and other traditional lending sources a lot these days. They are under pressure to reduce their portfolio exposure to commercial real estate which of course shuts of the front end of the new loan effort. When traditional lenders pull back, there is more room for GMC to do open field running.

I believe the loans available at this time offer very attractive risk reward dynamics. As the availability of capital remains constricted, those of us with capital to lend are able to set the terms. We are able to command higher yields while dictating other terms that mitigate risk.  As discussed here in the past, we at GMC are constantly evaluating Exit Dynamics. The idea of Exit Dynamics drives my underwriting philosophy.  I define Exit Dynamics as the influences on a borrower’s ability to sell a property or refinance a loan.  As we ramp up our loan volume, it is critical to understand how the back end is functioning. The same dynamics of a constricted front end market create a limited option back end or Exit and thus impact Exit Dynamics.  

I’ll admit there was a brief period where I was concerned about those Exit Dynamics. The Exit Velocity (another baseball reference) was slowing. We do see a resurgence of payoffs through sale and refinance both fueled by an acceptance of a new normal in interest rates.  I believe the data optimistically suggest inflationary pressures are easing and indicate an upcoming reduction in the Fed Funds Rate. When capital decides to go the sidelines it doesn’t stay dormant for too long. Increased yield opportunities attract capital back in to the market as the alternative tends to be “boring” in a yield sense.

As you might imagine, we are open for business; although, we are selective in our underwriting. We have produced a record volume of loan dollars this year while picking the best from the pile.  This combination indicates a pretty large and filled with good deals and good loan opportunities.

We would love to hear from you. We enjoy hearing about your good deals! We are happy to take time to discuss what fits for us and help where we can. Best of luck to you all in the second half of 2024. I am excited to get the inflation down and the election decided to eliminate those risk factors.