CRE Lending as an Art
April 26, 2021
Many may view CRE Lending as a boring, check-the-box job, but I like to think of lending as an art and not always a ‘one size fits all’ transaction. Yes, part of the due diligence includes underwriting cash flow, guarantor strength and collateral position and analyzing the 5 Cs of credit (character, capacity, collateral, capital and conditions), but I like to focus on the creative side of lending relationships.
A good Lender is one that takes time to build a relationship and is innovative in developing unique solutions to help you meet your goals. A big part of our job is risk management and every loan comes with its own set of risks. Having a conversation about how risks are going to be mitigated is a great first step to building a successful Lender/Borrower relationship. Collaborating together to determine what’s most important to the project’s success works to the benefit of both the Borrower and Lender. A Lender that can think outside the box might just be your ticket to long-term success.
While a lot of work is done up front, don’t forget that the relationship doesn’t end once the deal is closed. Anyone in Commercial Real Estate knows things don’t always go according to plan. Be sure to work with someone you can trust when those situations arise. My advice is to work with a Lender and Bank that is knowledgeable, flexible and willing to act as an advisor in those situations.
In addition to checking the standard boxes for underwriting, there are a few questions to ask yourself when choosing a Lender. “Do I need a transaction or a partnership?” “Is my Lender listening to my goals and coming up with solutions to meet my needs?” “Will my Lender be there for me through the life of this transaction, and help me work through any issues?” Choose a partner with your best interest in mind; someone who is always thinking ahead, and someone who will be there for you every step of the way.
ACCESSbank is a locally-owned community bank that is strategically growing our Commercial Real Estate loan portfolio. We take pride in building long-term relationships with our clients and have a great reputation in the Commercial Real Estate community. We would love to chat with you about your next project!
Amanda Sudbeck, VP | Relationship Manager, ACCESSbank