A subsidiary of PacWest Bancorp has acquired the multifamily lending wing of Redondo Beach-based Wedgewood.
Beverly Hills-based Pacific Western Bank bought Civic Financial Services, which provides loans to real estate investors, according to the Los Angeles Business Journal. Terms of the deal were not disclosed.
Civic will retain its branding while becoming a wholly-owned subsidiary under PacWest. Civic’s president, William Tessar, will continue to lead the firm.
The company has provided $4.4 billion in loans since 2014, including $1 billion since the pandemic hit, it said. Pacific Western Bank President and CEO Matt Wagner said the acquisition “opens the door for us to grow in the private lending space,” according to the report. “We believe there is growth and earning potential in the residential space,” he said.
PacWest acquired Civic as part of a push to diversify its parent company’s lending portfolio. PacWest lends on assets outside of real estate as well, including commercial aircraft and commercial equipment. As of 2019, its assets totaled around $27 billion. The bank lost more than $1.2 billion last year that it pinned on impairment charges and credit loss provisions, the Journal noted.
Lending has tightened up since the pandemic and some multifamily landlords say they have struggled to pay their mortgages as some tenants skipped paying rent. Hundreds of landlords statewide received forgivable loans from the federal government last year.
Los Angeles landlords and those across California have challenged eviction moratoriums in court, but the measures remain in place. The state recently extended its eviction moratorium, while also implementing a rent subsidy program that could provide landlords with some guaranteed income. [LABJ] — Dennis Lynch