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At a time when we have experienced months of challenges none of us would have ever imagined – the triple threats of COVID-19, the employment and financial impact, and then the extraordinary protests once again calling for imperative, true, and lasting equality, we wonder if there is any good news to counterbalance what is playing out on the global stage. Where are we finding collaboration, patience, creative problem-solving — and solutions? And can we in commercial real estate forge forward during a time of confusion, distraction and uncertainty in not only the markets, but in our society and common humanity? We found that answer to be “yes, we can.”
As we move forward, we need to walk on steppingstones of hope and resiliency to grow personally and professionally. We should look for new ways to share vulnerability and nurture important relationships we have developed over the many years of our careers. One recent experience presented an opportunity for us to do just that. It gave us a much-needed ‘breath of fresh air’ during this troubling and turbulent time.
Southern Management Corporation (SMC), one of the largest privately-owned residential property management company based in the Mid-Atlantic executed an RFP as it sought to refinance 67 of its multi-family properties, primarily affordable, across the DMV. Traditionally, SMC refinanced the portfolio every eight years with the same team of professionals and loan product. This time around Suzanne Hillman, SMC’s CEO, sought to change the game plan to invite competition in an effort to identify the best team to handle the transaction.
SMC’s RFP process presented an opportunity for fresh ideas and creativity to emerge from participating teams of brokers, law firms, lenders, and title companies. The result was the successful close of a $2.4B Fannie Mae Credit Facility, the largest transaction in Walker & Dunlop’s history.
How it came together is a case study in collaboration, cooperation, creativity, grit, and high energy, especially in light of the late February start and April 30 hard deadline to close. Completing a transaction of this size with such a condensed timeline would be remarkable under normal circumstances, but this large and complex transaction closed during the COVID shutdown. SMC’s commitment to building a best-in-class team of professionals equipped to respond to the challenges was essential to getting it done.
The story is rich with open communications, professional camaraderie, and a strong reliance on deep relationships that had been growing over years, if not decades. Moreover, in this time of the most heightened focus on diversity, it is important to point out that the majority of the key players in the transaction were women – over 15 in all. On the title team, five of the six leads were women. Nearly all of the women participants in the transaction have been in the commercial real estate industry for more than two decades.
For our competing commercial title insurance offices, it was a true celebration of the strength of our professional and personal friendships. In the original RFP, SMC called upon title companies to compete separately to win the deal. Chicago Title’s National Commercial Services office located in DC was the incumbent title team. However, SMC also invited the national commercial office of Fidelity National Title in DC to respond to the RFP.
Early on, we identified that the size of the transaction required that multiple title underwriters be involved to coinsure/reinsure, thereby presenting an opportunity to integrate our two outstanding title teams to pitch SMC. We approached SMC to see if they were open to us responding to the RFP as a joint team.
SMC recognized our business plan as an innovative way to align the talent provided by both offices and meet the objective of the project. This collaborative approach also allowed us to structure the insurance to maximize cost-savings to SMC, while also taking advantage of Chicago Title’s institutional knowledge of the portfolio.
The role of a title company in a commercial transaction is often viewed as just a commodity. However, a deal of this size and complexity demonstrates the importance of having a world-class title team. The collective talent of the two firms, in the areas of search, examination, underwriting, production, closing and post-closing capabilities, would allow us to provide SMC with the needed expert resources, enhanced attention, and quicker response times. This was especially important to meet SMC’s compressed timeline.
As we all tend to reflect on “lessons learned” after both deal losses and wins, we view this win as one for the record books. Amidst all of the turmoil, we are proud to say that our title team met the challenge and exceeded SMC’s expectations. Our hope is that all of us can rise to the occasion.
We invite you to join us for a deep-dive into this transaction on Monday, July 13th, when we will be joined by Suzanne Hillman of Southern Management, Jeff Hayward of Fannie Mae, Brendan Coleman of Walker Dunlop, Leslie Ludwig of L&L Advisors in a ULI case study webinar. It will be a great opportunity to learn about the complexity and nuances of the transaction and hear from some of the other key leaders who made it happen. Click here to register.
Senior Vice President-Director of Client Relationships
Fidelity National Title Insurance Company
National Commercial Services | DC
Charlotte Troup Leighton
Senior Vice President, Director of Business Development
Chicago Title Insurance Company
National Commercial Services | DC
In ULI Washington’s new Leadership Insights column, ULI Washington will regularly feature member leader’s thoughts and insights as we adjust personally and professional to a “new normal.”