Walker & Dunlop Closes $3.8 Billion Servicing Portfolio Acquisition

Walker & Dunlop, Inc. WD disclosed Tuesday that it completed the $3.8 billion commercial mortgage servicing portfolio acquisition from a subsidiary of Oppenheimer Holdings Inc. OPY for a final closing price of $44.6 million. According to the company, the acquired portfolio, consisted of 480 permanent loans insured by the Department of Housing and Urban Development (HUD), has a weighted average servicing fee of 17 basis points. Walker & Dunlop said that the servicing revenue from the acquired portfolio is estimated to be about $6.4 million on an annualized basis. The company added that of the 480 loans, 361 loans, with an unpaid principal balance of $2.7 billion, were secured by multifamily properties. The other 119 loans, with an unpaid principal balance of $1.1 billion, are secured by seniors housing and healthcare properties. The company indicated that the acquired portfolio brings with it $230 million in escrow balances, as well as, no loss-sharing risk to it. With the addition of this portfolio, Walker & Dunlop would commence interacting with its new customers immediately in the process of servicing their loans and meeting their future financing needs. According to the company, the loans in the portfolio have a weighted average note rate of 3.99% and an average age of 44 months. The company added that its average remaining life of the portfolio loans is 31 years. Given the relatively low average note rate and remaining maturity of the portfolio, it sees limited scope of prepayments of loans in the upcoming years. On Monday, the stock traded 1.48 percent up.