About Our Office

Our San Diego office offers a complete range of debt and equity options for all types of commercial and multifamily real estate. We are active Fannie Mae and Freddie Mac lenders, in addition to being a correspondent for a wide array of insurance companies, and possess strong relationships with dozens of CMBS lenders, banks and equity investors. We create innovative solutions involving all financing structures. We also offer investment sales services for multifamily and manufactured housing properties. Please call us at 858.675.7600 to learn more.

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San Diego Q3 Market Report: Job Growth Fueling Absorption of New Units


  • The San Diego multifamily market continues to post strong performance. The market is proving it can absorb the new inventory that has been delivered in recent years, keeping overall vacancy low.
  • Vacancy held steady at 3.8 percent, and the rate has dropped 10 basis points year over year. Vacancy in Class B and Class C units averages just 2.2 percent.
  • Current asking rents are $1,878 per month, 3.8 percent higher than one year ago. Rents have trended higher at a fairly steady pace since 2016.
  • The favorable market performance supported investment sales activity in recent quarters. Year-to-date sales velocity has mirrored levels from 2018, while prices have pushed higher and cap rates have remained flat.

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All signs point to a comeback for San Diego apartment investment sales in 2019-2020

Kyle Pinkalla, managing director of investment sales in NorthMarq’s San Diego office, authored an article highlighting an expected turnaround for San Diego apartment investment sales that was featured in the September issue of Western Real Estate Business.

While Proposition 10, California’s proposal to strengthen rent, was defeated on the ballot, it somewhat stifled the multifamily investment sector in San Diego.

But the market appears poised to bounce back. Pinkalla discusses how the “tides have begun to turn in the past few months, with numerous apartment deals on the market–more than we’ve seen at one time in the past few years.”

This is especially true in Downtown San Diego where a significant number of new merchant-built deals are expected to come to market, continuing throughout the year. These are luxury complexes, with some expected to fetch as much as $600,000.

Read the full story here.

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San Diego Q2 Market Report: Vacancy Tightens, but Deliveries to Pick Up in the Second Half

Multifamily property fundamentals in San Diego improved during the second quarter. Vacancy inched lower, rents rose, and employment growth fueled absorption of units.

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Vacancy dipped 10 basis points in the second quarter, falling to 3.8 percent. The rate is down 20 basis points year to date. Vacancy has ranged between 3 percent and 4 percent since the second half of 2015.

Asking rents in San Diego rose 1.1 percent in the second quarter and are up 4.7 percent from one year ago. Current asking rents are$1,850 per month.

Despite the market’s strong performance, fewer multifamily properties sold in the second quarter than changed hands during the first quarter. The median price in transactions year to date is approximately $258,200 per unit, while cap rates have averaged 4.7 percent. Both measurements are nearly identical to 2018 figures.

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San Diego Q1 Market Report: Sales of Larger Properties Dominate Transaction Activity


Q1 2019 San Diego multifamily market indicators
  • Multifamily properties in San Diego performed well at the start of 2019. Vacancies tightened during the first quarter and rents rose, even as more than 1,000 new units were added to the local inventory.
  • Vacancy dipped 10 basis points in the first quarter, reaching 3.9 percent. Despite the recent drop, the rate is up 20 basis points year over year.
  • Rents are trending higher in San Diego; asking rents are up 4.6 percent from one year ago, ending the first quarter at $1,830 per month.
  • The investment market was active at the start of the year, with several properties in excess of 200 units changing hands. The median price rose to $270,900 per unit, while the average cap rate held steady at 4.6 percent.

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San Diego Q4 Market Report: Larger Sales Lead the Way at the Close of 2018


San Diego Q4 2018 Market Indicators graphic
  • The San Diego multifamily market recorded strong renter demand and even more robust supply growth in 2018. The vacancy rate crept higher, while rent growth was strong throughout the year, with the greatest gains recorded in the second half.
  • Vacancy rose 50 basis points in 2018, ending the year at 4 percent. The market recorded a 10-basis-point uptick during the fourth quarter.
  • Despite some upward pressure on vacancy, local rents rose at their fastest rate since 2015. Asking rents in San Diego spiked by 5.4 percent in 2018, reaching $1,822 per month.
  • The investment market strengthened at the end of 2018, with activity accelerating, cap rates compressing, and the median price spiking.

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NorthMarq adds multifamily investment sales in San Diego, California

MINNEAPOLIS (JANUARY 28, 2019) – NorthMarq, a leader in commercial real estate capital markets, announces the expansion of multifamily investment sales by adding expert Kyle Pinkalla in its San Diego regional office. As managing director, he will work to continue the expansion of NorthMarq’s multifamily investment sales business with investors across the country.

Pinkalla will have responsibility for multifamily acquisitions, dispositions, broker opinions of value and market insights. With more than 15 years of commercial real estate experience in investments sales, development, acquisitions and onsite management, he has been involved with more than $2 billion of multifamily investment sales in the last five years in Southern California markets. He will also closely coordinate with Shane Shafer, NorthMarq’s managing director-Investment Sales in Los Angeles

“I am excited to join this growing team of investment sales professionals but equally excited about joining the strong team of debt and equity professionals in San Diego,” Pinkalla said.

Shafer, who joined the NorthMarq platform in late October, welcomed Pinkalla to the team. “We’ve collaborated on a number of transactions in the last few years and I am energized to work with Kyle more closely as part of NorthMarq’s team,” he said.

Trevor Koskovich, president-Investment Sales, is leading the platform’s growth, which in addition to the newest office in Los Angeles, now includes teams in Arizona, Kansas, Missouri, New Mexico and Texas. He is recruiting professionals who are interested in leveraging the company’s culture and track record of debt and equity transactions. “Given the size of the Southern California market, it is a strategic growth opportunity for us as we build on our recent expansion in Los Angeles and integrate the sales and finance business on the West Coast.”

The San Diego regional office is one of NorthMarq’s top performing offices, led by Eric Flyckt. “Kyle is well-known to our team in San Diego based on volume and profile of transactions he has closed over the years. We are excited to leverage his experience with multifamily investors throughout the region and develop the synergy with clients that our other offices with investment sales professionals are experiencing,” said Flyckt, senior vice president/managing director.

Pinkalla joins the 12-person debt and equity team in NorthMarq’s San Diego regional office, 12230 El Camino Real, Suite 220, San Diego, California. In business since 1960, NorthMarq Capital has grown to more than 500 employees through more than 20 acquisitions, now servicing a loan portfolio of more than $55 billion with annual transaction volume of $13 billion.

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Casey Allred joins NorthMarq Capital’s San Diego office as investment analyst

SAN DIEGO (June 28, 2018) – Casey Allred recently joined NorthMarq Capital as an analyst for the San Diego office.

Casey’s responsibilities include originating real estate financing for apartments and commercial properties, underwriting, due diligence, and assisting the production team.

Prior to joining NorthMarq, Casey worked on the acquisitions team at Realty Income Corporation where he underwrote over $3 billion in transactions and assisted in the closing of over $1 billion in retail and industrial properties.

Allred graduated from Southern Methodist University in 2008 with a B.S. in Financial Economics.

“I am very pleased to have Casey join our outstanding team,” said Eric Flyckt, managing director of the San Diego Office. “Our clients and colleagues will benefit from his industry experience, analytical skills and business relationships.”

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Aaron Beck and Eric Flyckt give GlobeSt.com mid-year update on Fannie Mae and Freddie Mac activity

Rising Interest Rates Haven’t Slowed Agency Activity

The agencies are seeing another strong year. To date in 2018, Freddie Mac has funded $22.9 billion, an 18% year-over-year increase, and Fannie Mae is on par with the tremendous volume that it did in the first part of 2017. While interest rates are likely to rise, they remain at historic lows and are not expected to have a significant impact on agency activity. GlobeSt.com sat down with Aaron Beck, vice president at NorthMarq Capital, and Eric Flyckt, senior vice president at NorthMarq Capital, to get a mid-year update on agency activity and a look at the year ahead.

GlobeSt.com: How has Fannie Mae and Freddie Mac’s activity in the first half of the year compared to activity during the same time in 2017?

Eric Flyckt: Fannie Mae’s year-to-date volume through May is $20.1 billion versus $25.2 billion through May of 2017. However, 2017 figures were anomalous, due to a huge January rollover from 2016—$9.3 billion of volume in January 2017 versus $4.6 billion in January of 2018. April and May 2018 figures exceed same-month production from 2017 by a healthy margin. Through May, Freddie Mac funded $22.9 billion, an increase of 18 percent over the same period last year.

GlobeSt.com: What is continuing to drive agency demand this year?

Flyckt: Low rates, innovative product enhancements and a flexible underwriting. Though US Treasury yields have increased considerably, Fannie Mae is aggressively pricing quality business. Fannie Mae continues to introduce new product and process enhancements. Their near-stabilization execution has been a very popular driver of new business this year. Fannie Mae has also exhibited a flexible approach to credit, allowing its DUS lenders to stretch to win the right business.

Aaron Beck: There are a number of factors driving multifamily demand. Top among them are the demographics of today’s renters. Baby boomers and millennials are entering the rental market in increasing numbers. A growing portion of the nation’s boomers are looking to downsize, while many millennials want to start new households. Today’s millennials are slower to reach major adult milestones than past generations, paving the way for a solid renter base in the years ahead. Last year, about half a million young adults moved out of their parents’ homes, the majority likely choosing to rent. Yet, close to another million are still residing with their parents. This existence of these “shadow households” implies that there is still significant potential for growth in the number of new renter households, absent any further economic or demographic changes.

In addition, a growing number of households are showing a preference for rental housing. In Freddie Mac’s recent survey of America’s renters, the company found that a total of 67 percent of renters view renting as more affordable than owning a home. With rising interest rates, that percentage is likely to increase, particularly amongst first time homebuyers. Almost three-fourths of millennial renters say that they will continue renting due to financial reasons. That number was at 59 percent just two years ago.

GlobeSt.com: Do you expect this activity to change as interest rates rise?

Flyckt: Intuitively, it seems like a sharp increase in interest rates would result in an attendant decline in production volume.  That said, treasury yields have increased approximately 50 basis points since the beginning of the year; however, Fannie Mae is experiencing a banner year in terms of year-to-date production volume.  The increased Treasury yields perhaps have encouraged some Borrowers off of the fence. In addition, Fannie Mae has employed aggressive pricing waivers to help make deals work in spite of the rising yields.

Beck: To date, increasing interest rates have not had much of a negative impact on multifamily or commercial transaction volume. This should continue to be the case in the near future due to the lack of properties available for sale, plenty of available capital, multiple buyers competing for properties, and a strong tenant demand and economy.

GlobeSt.com: What programs within Fannie Mae have been most popular this year, and why?

Flyckt: Fannie Mae’s near-stabilization program has been a very big seller this year as a result of the large number of new construction and renovation deals approaching stabilization. The near-stabilization program provides the ability to lock the rate and fund the loan upon reaching 75 percent occupancy. This has been an effective means for Borrowers to take interest rate risk off the table without waiting for full stabilization and without reducing loan proceeds since Fannie Mae sizes the loan assuming stabilized occupancy.

Beck: Freddie Mac continues to see dramatic success in a number of core programs including its small balance loan business, for properties with five to 50 units, targeted affordable housing, for properties where some or all the units have rent restrictions or receive government subsidies, and green lending, which is exceeding last year’s volume. Freddie Mac’s Green products finance energy- and water-saving improvements.

GlobeSt.com: What is your outlook for Agency production in the second half of the year?

Beck: Both Fannie Mae and Freddie Mac have significant ‘dry powder’ vis-a-vis their regulatory production cap, so we expect the Agencies to be poised to continue to compete aggressively for business through the balance of 2018.  Absent some material unforeseen disruption, we expect a strong finish to the production year and volume to be consistent with last year’s outstanding performance.

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Aaron Beck featured in GlobeSt.com: Are Borrowers Still Running to Fannie Mae’s Green Program?

Fannie Mae’s green lending program was extremely popular last year, but the business has fallen slightly this year.

Fannie Mae’s green lending program has been extremely popular—and because the business falls outside of Fannie’s lending caps, there is plenty of opportunity. However, this year, the business has fallen over the same time last year. However, the benefits continue to make the program a popular option for borrowers. Aaron Beck, a vice president in NorthMarq Capital’s San Diego office, recently secured a $17 million refinance loan through the program for a 280-unit apartment property in Las Vegas. Because the long-term non-recourse loan was secured through the green rewards program, the borrower was able to lock in a rate 35 basis points below Fannie Mae’s standard rate. To find out more about the demand for this financing this year, we sat down with Beck for an exclusive interview.

GlobeSt.com: Fannie Mae’s green program was incredibly popular last year. What has activity been like in the first quarter of 2018?  

Aaron Beck: Green financing remains very popular; however, business that falls outside of Fannie Mae’s 2018 lending cap of $35 billion—this includes Fannie Mae’s Green Rewards Program—has comprised a slightly smaller portion of their total year-to-date business, as compared to last year. This is largely due to the very attractive spreads that Fannie Mae has been providing for conventional loans in the midst of the current lending environment, which is extremely competitive. Ultimately, I expect the amount of Green financing, as it relates to Fannie Mae’s overall 2018 volume, to return to a level at or near that of 2017.

GlobeSt.com: Have the requirements changed this year, or has the process in obtaining a green loan changed as a result of the high demand?  

Beck: The primary change was a regulatory adjustment to the type of Green financing that is exempt from FHFA’s (Federal Housing Finance Agency) lending cap of $35 billion for each Fannie Mae and Freddie Mac. This exemption allows for the reduction in spread, which currently ranges from about 10 to 20 basis points; although, the program allows for a reduction of up to 39 basis points. In order for loans to qualify for the Green Rewards Program in 2018, Borrowers now need to identify and agree to implement Green improvements estimated to save 25% in annual water or energy usage. The previous threshold was 20 percent. This has not caused a material change in the volume of Green loans that are being executed. At the end of the day, it may end up costing a Borrower a few dollars more to meet the 25 percent threshold (vs. 20 percent). For example, if a property would have qualified with only installing faucet aerators and low-flow showerheads in prior years, perhaps the property will now require the additional implementation of something like low-flush toilets.  If a loan qualified at the 20 percent threshold, there is generally a path to meeting the 25% threshold at a nominal cost increase. Fannie Mae’s Green Rewards Program does not require Borrowers to spend a minimum per unit dollar amount to satisfy the agreed to Green improvements.

GlobeSt.com: What clients or deal types have been the most interested and active in the green lending program through Fannie Mae, and why?  

Beck: It’s been a very broad cross section of clients – from large institutional groups, to regional middle-market owners, to small local operators. The interest rate savings are significant, the program requirements are not onerous, and the added cash flow generated by reduced utility costs is material. As long as a pronounced spread differential exists between conventional and Green loans, Borrowers for nearly every proposed Fannie Mae loan should strongly consider Green financing as an option. The opportunity cost of not considering it far outweighs the minimal cost if the property does not qualify. As for property type, we’ve been successful in securing Green business for a wide range of apartment properties, varying in condition and vintage. Even newer buildings without as much “low-hanging-fruit” have qualified for Green improvements.  Because the outlook for energy and water efficiency is constantly shifting, there will continue to be opportunities for Green upgrades.

GlobeSt.com: Are there other green programs that have become competitive with Fannie Mae’s program? 

Beck: Yes, Freddie Mac has its own version of Green financing known as “Green Advantage.” This, too, has been extremely popular amongst multi-family Borrowers. The same 25 percent estimated savings threshold per year for energy or water that applies to Fannie Mae’s program applies to Freddie Mac’s program. Each program allows for significant interest rate savings at very little cost to Borrowers.

GlobeSt.com: You recently secured funding through the program for a 280-unit apartment property in Las Vegas. Why was the green program a good fit in this instance, and what was the process like to secure funding? 

Beck: The property was built 20 years ago. While the Borrower has done an excellent job of completing upgrades for energy and water efficiency, we soon recognized there were additional improvements that could be completed to meet the minimum water savings threshold. In this instance, the Borrower agreed to install low-flow faucets and showerheads, and make some improvements to irrigation within the first twelve months of the loan term. The estimated total cost for these Green improvements was less than $60,000 ($215 per unit).  In turn, the spread was reduced by more than 35 basis points. The total loan interest and water usage savings to the Borrower over the term of the loan is estimated at nearly $500,000.  Aside from completing an additional report for water and energy efficiency (cost of the report was reimbursed to the Borrower at closing) and agreeing to make the Green improvements, the process for securing the Green loan was no different than a conventional execution.

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The Speed of Change: CMBA Western States CREF Conference Takeaways

The summer lull, experienced by many, has given way to a pick-up in production by NorthMarq’s west coast offices. Producers from six of our offices met with our correspondent insurance companies, CMBS, bridge and bank lenders during the annual CMBA Western States CREF conference held in Las Vegas the first week in September. The tagline for the three day conference was “The Speed of Change,” a theme that rang true amongst the capital providers and mortgage bankers in attendance, all looking to set themselves apart in a competitive and ever-changing commercial real estate financing landscape.

Multifamily, office and industrial continue to be the most sought after assets, while signals on retail remain mixed as the impact of the “Amazon-Effect” continues to make its presence felt. Some capital sources we spoke to have reduced their retail appetite to only grocery-anchored centers in top MSA’s, while others feel they compete best on the unanchored or shadow-anchored centers. Overall, the shift in retail seems to be fluid and evolving; where some groups see risk, others are seeing opportunity.

On the bridge and mezzanine finance side, a number of new players have entered the already crowded list of firms looking to fund transitional, value-add and underperforming assets. This increased competition has caused spreads to come in and seen a growing number of firms tweak their parameters in order to win deals. Requests under $10 million and those is secondary and tertiary markets are seeing access to capital from bridge lenders who have historically stuck to larger deals in top MSA’s. This shift includes mezzanine and preferred equity providers, where some minimums have come down to as low as $3 million. Asset classes like hospitality have seen an increased access to capital, which was noticeably reduced in recent years, as lenders begin to cast a wider net to deploy their capital.

CMBS lenders are on track to issue more notes in September than any other month this year, according to Commercial Mortgage Alert, as they have become comfortable with the new risk retention. While some of the big players are winning deals on superior pricing, smaller shops are getting creative in deal structures to win the business. This flexibility includes capping upfront costs, conceding on certain reserve requirements and pushing leverage. Some CMBS shops are also looking to increase production on their balance sheet bridge programs, which allows them to participate on more transitional assets and in turn increases their securitization pipeline.

Insurance companies are also getting creative and breaking the mold of a “down-the-fairway” approach to lending. While they still prefer quality assets with lower leverage, the groups we spoke with point to increased competition from banks and stagnation in investment sales during the first half of the year as major catalysts to their shifting appetite. Many insurance companies have stepped into the bridge, mezzanine, and even construction space. One insurer recently funded a three year, 90 percent LTC participating construction loan on a multifamily development in the Midwest – a very unique and creative structure. On the permanent financing side, the benefits of an insurance company execution, long-term structures and low pricing, coupled with the ability to forward rate lock at application (up to 12 months), continues to set them apart from both CMBS and bank lenders.

The “speed of change” seems to be driven by a multitude of factors playing out in the industry. The true beneficiaries of this change are the borrowers and mortgage bankers, who are enjoying access to historically low rates, more options than ever before, and the negotiating power to ensure they’re getting the best deal.

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NorthMarq Capital’s San Diego office adds vice president

SAN DIEGO (August 1, 2017) – NorthMarq Capital, a leader in financing commercial real estate throughout the United States, announced today that Conor Freeman has joined its San Diego office serving as vice president.

In his new role at NorthMarq, Freeman will be responsible for providing clients with creative solutions through NorthMarq’s life insurance relationships, Fannie Mae, Freddie Mac, FHA/HUD, CMBS lenders, debt funds, banks and credit unions. Freeman comes to the San Diego team after serving as the Director of Capital Markets for a boutique mortgage banking firm, where in 2 ½ years he originated over $200 million in transactions in core, secondary, and tertiary markets nationwide, involving commercial and multifamily asset classes. Freeman earned his bachelor’s degree from San Diego State University.

“We are very pleased to have Conor join our team,” said Eric Flyckt, senior vice president/ managing director based in NorthMarq’s San Diego office. “His capital markets knowledge and experience, combined with NorthMarq’s unmatched lending partners, will allow him to deliver innovative financing results to our clients.”

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NorthMarq Capital’s San Diego office promotes Wyatt Campbell to vice president

The San Diego regional office of NorthMarq Capital is pleased to announce the promotion of Wyatt Campbell to vice president. In his new role, Wyatt’s primary focus will be the origination of various forms of real estate financing including permanent loans, construction loans, bridge loans and joint venture equity.

Wyatt joined the San Diego office in 2015 as an investment analyst, where he has assisted in closing over $265 million financing transactions involving Fannie Mae, Freddie Mac, life insurance companies, CMBS and equity investors.

Prior to joining NorthMarq, Wyatt was part of the CBRE’s Private Capital Group in Tucson, Arizona. While at CBRE, he specialized in the disposition of commercial and multifamily investment assets.

Wyatt graduated from the University of Arizona with a B.S. in Public Management & Economics.

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