Fourth Vet-Owned Firm Targets CMBS

The field of broker-dealers that help distribute commercial MBS offerings is getting more crowded with firms that put a big emphasis on hiring U.S. military veterans. 

  After its first outing this week as co-manager on a CMBS deal, AmeriVet Securities intends to seek out such assignments regularly. The New York firm is one of two co-managers on an $802.5 million conduit offering, led by Goldman Sachs and Citigroup (GSMC 2019-GC39), which priced yesterday (see article on Page 4). The other is Drexel Hamilton, also of New York. 

  Until last year, Drexel and Academy Securities of New York were the only broker-dealers owned by disabled veterans that routinely served as co-managers on CMBS offerings. A third, Bancroft Capital of Fort Washington, Pa., came on the scene in December and has been tapped as co-manager on three private-label CMBS deals so far. AmeriVet became the fourth contender when it was approved by FINRA in January as an institutional broker-dealer.

  All four shops put a heavy focus on employing veterans and training them for careers on Wall Street. CMBS issuers are generally eager to include such firms in their new-issue syndicates so they can show support for veterans and employee diversity. It can also help them reach investors that typically aren’t pursued by the biggest dealers. 

  Founded in 1994 by chief executive Elton Johnson Jr., AmeriVet has been a FINRA-certified retail brokerage, selling securities to mom-and-pop investors. Its new FINRA designation coincided with a $7 million infusion of capital from South Street Securities, a New York brokerage that concentrates on repurchase financing. 

  AmeriVet has tripled in the size of its staff over the last year or so, and plans to add four more sales-and-distribution pros to its 10-member roster over the next two months, said fixed-income chief Patrick Perdue, an Academy alumnus. The recruits, with 5-10 years of experience, would work on a variety of offerings, including agency and private-label CMBS, residential MBS, municipal-bond issues and corporate-bond placements. 

  Drexel entered the CMBS sector in 2012, followed by Academy in 2015. They led a Commercial Mortgage Alert ranking that gave full credit to all members of underwriting syndicates on global CMBS offerings that priced in 2018. Drexel co-managed $36.9 billion of last year’s transactions, while Academy worked on $34.9 billion of deals. Bancroft ranked 21st with one assignment on a $796.8 million transaction.

  Academy still led the pack in the first quarter, with $7.1 billion of mandates. Drexel slipped to third place, filling that role on $6.5 billion of deals. Bancroft moved up to 18th place as of March 30th, after working on $402.8 million of first-quarter offerings. 

Published May 10, 2019

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