Regions Bank is acquiring Sabal Capital Partners LLC, a financial services firm that leverages a technology-driven origination and servicing platform, SNAP, to facilitate lending in the small-balance commercial real estate market for clients nationwide.
California-based Sabal is one of the top originators of Fannie Mae and Freddie Mac small-balance commercial real estate loans. Regions plans to incorporate Sabal into its growing Real Estate Capital Markets division.
Sabal has originated nearly $6 billion in financing across the U.S. since 2009 and maintains a current servicing portfolio of nearly $5 billion.
“With the addition of Sabal Capital Partners, Regions will become even better positioned to further build on our client base and deliver an expanded range of agency and non-agency options for real estate lending,” said Joel Stephens, head of Capital Markets for Regions Bank. “Sabal’s industry-leading technology platform and its leadership in the small-balance commercial real estate arena make the company a great match for Regions. Our current affordable and large-balance Fannie Mae and Freddie Mac products, combined with Sabal’s small-balance agency capabilities, will allow Regions to offer real estate solutions across the full spectrum of agency offerings.”
The SNAP program allows Sabal to use real-time commercial property financing scenarios, online loan applications and technology enabling clients to track loan progress through deal closure. The company offers Fannie Mae Small Loans, Freddie Mac Optigo Small Balance Loans and Freddie Mac Optigo Conventional Loans.
“For years, our work has been defined by a contact focus on innovation, and Sabal Capital Partners joining the forward-thinking team at Regions Bank is a natural fit as Sabal offers tailored lending solutions and reaches more clients together with Regions,” said Pat Jackson, CEO of Sabal Capital Partners.
Regions will maintain Sabal’s flagship offices in Irvine and Pasadena, California, as well as New York City. When combined with Regions Real Estate Capital Markets’ existing production offices, the combined platform will have 20 production offices nationwide.
Regions’ agreement to acquire Sabal Capital Partners LLC is specific to the lending and servicing segments of Sabal’s business and does not include Sabal’s investment management business, which will remain with the sellers, and investment funds managed by Stone Point Capital LLC. Jackson and Mike Wilhelms, Sabal’s chief financial officer, will remain with the investment management business while other members of Sabal’s leadership team will join Regions.
The acquisition is expected to close in the fourth quarter of 2021, subject to required government approvals. Terms of Region’s agreement to acquire Sabal Capital Partners were not disclosed.
Beekman Advisors represented Regions in connection with the Sabal Capital Partners transaction, and Davis Polk & Wardwell LLP served as Regions’ legal counsel. Wells Fargo Securities LLC served as financial advisor to Sabal Capital Partners, and Kramer Levin Naftalis & Frankel LLP served as Sabal’s legal counsel.
Regions Bank has acquired additional financial service partners in recent years, including the 2020 acquisition of equipment finance lender Ascentium Capital and most recently home improvement point-of-sale lender EnerBank USA. The EnerBank USA acquisition just finalized on October 1.