GPARENCY’s direct-to-bank formula is designed to connect real estate investors and developers to banks without the need for a broker.
The company is offering a banking team of funding coordinators to underwrite, shop, and negotiate term sheets for a fee of $5,000 per deal. Once the transaction is finalized, the client will have the option to continue working with the bank or with GPARENCY for $500 per hour with a cap of 30 hours, which Zlotowitz described as a billing model used by lawyers and accountants.
“After studying the commercial mortgage market, we saw that 20% of borrowers exclusively use brokers, while 80% want to work directly with banks,” Zlotowitz said. “Many think that broker fee structures for larger deals needed to be changed. This is exactly what we are doing at GPARENCY.”
The GPARENCY team consists of 25 analysts, underwriters, researchers, software engineers, and debt and equity professionals. Zlotowitz said the next steps will be to hire a chief technology officer and add more software engineers and underwriters. GPARENCY will also eventually provide long-term plans for borrowers that will provide all data and tools directly to them through a subscription-based service called LANDSCAPE.