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Full Speed Ahead! American Financial Realty Trust Grabs Another Portfolio

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Commercial Property News
June 10, 2005
By Paul Miller, News Editor

Having raised about $215 million five weeks ago, American Financial Realty Trust is actively deploying that capital on three major acquisitions, including one it completed today. The Jenkintown, Pa.-based REIT, which focuses on acquiring and leasing properties occupied by financial institutions, completed the acquisition of a portfolio of 26 properties from Charter One Bank, N.A., a subsidiary of Citizens Financial Group Inc., for approximately $27 million, excluding transaction related expenses.

The acquisition is, in fact, the fourth out of six that American Financial previously announced it would undertake during the first half of calendar 2005. Among the others, the firm in late May obtained the Bank of Oklahoma City Plaza, a 234,115 square-foot, class A office building in Oklahoma City, for $20.3 million.

As for the Charter One Bank purchase, Nicholas Schorsch, American Financial's president & CEO said that the deal reflects American Financial's ability to execute multi-property acquisitions in response to its customers' needs. "This is a relationship-driven business," he said. "That's why we're in the $200 billion niche market. We have more than $4.4 billion in assets, but are still very nimble and responsible to our customers. When a customer calls and says we have to deal, we execute on it by putting in place multiple teams and can scale rapidly."

As an example, he noted how the firm closed on 1 Lincoln Square in Boston in February during Super Bowl weekend. "The deal took 20 days for more than $700 million," he pointed out. "That's an example of [how] we're able to be nimble."

With today's announced acquisition, American Financial is represented in 37 states--plus Washington, D.C.-for a total of 128 markets, having bought 232 properties so far this year with total acquisitions of approximately $600 million. The other two deals that are underway, Schorsch said, are expected to close later this month and next month, which will give the firm total deployment in excess of $300 million. "So we're looking forward to a robust pipeline," he said. "We're enjoying tremendous growth in our business platform, focused on core operations and our acquisition pipeline, as well as earnings growth from our existing pipeline."

What are people saying about mortgages today:

Rates on 30-year mortgages edged down last week to a seven-month low. Mortgage-giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages fell to 6.3 percent, down slightly from 6.31 percent two weeks ago. It put rates at the lowest level since they were at 6.24 percent the first week of March.

Bank of Hawaii, Central Pacific Bank, Territorial Savings Bank and Wells Fargo Home Mortgages all cut their 30-year mortgage rates to 5.75 percent this week.

Most people think of a mortgage as a means to an end. After all, you buy a house, not a home loan. But a mortgage is much more than the path to homeownership. It is a financial instrument that must be managed, just like any other financial investment.