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Show Summary
In this episode of the Real Estate Pros podcast, host Michelle Kesil interviews Moshe Orange, a commercial real estate financer. They discuss Moshe’s focus on various debt structures, the importance of building relationships in the industry, and the challenges he has faced. Moshe shares insights on scaling his new financing firm, creative financing solutions, and advice for lenders and investors. The conversation highlights the unique experiences in real estate financing and the necessity of persistence in finding deals.
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Moshe Orange (00:00)
And I told him, you know, if you don’t move quick and the next report is out, this deal might collapse because you won’t be able to achieve that. The bank once they issued the term sheet, it has a timeframe.of how long they will ⁓ honor that term sheet. And I told the sponsor if you don’t move quick, this deal is going to be dead. And he was betting that rates ⁓ will stay where they were. And the deal has collapsed once the lender pulled the rug under that term sheet.
Michelle Kesil (02:18)
Hey everybody, welcome to the Real Estate Pros podcast. I’m your host, Michelle Kesil. Today I’m joined by someone I’m looking forward to chatting with, Moshe Orange, who is a commercial real estate financer and very excited to have you here today, Moshe.Moshe Orange (02:37)
Thank you very much for having me, Michelle. I’m looking forward to this opportunity and sharing a little bit of my experience and some insights on commercial real estate financing.Michelle Kesil (02:50)
Definitely. So let’s dive in. First off, for those who are not yet familiar with you and your work, can you share what your main focus is? ⁓Moshe Orange (03:00)
So these days my main focus is doing commercial real estate financing, different kinds of debt structures. I have done, I’m really agnostic when it comes to ⁓ asset types. So I worked on hotels, I have worked on industrial, multi-families, ground up construction. ⁓So I have worked ⁓ with different kind of lenders as well, regional banks, debt funds, Freddie Fannie ⁓ and national banks as well.
Michelle Kesil (03:41)
and which markets do you operate in?Moshe Orange (03:46)
I think I have financed at about 40 different states. Never done a deal in Alaska or Oregon. So I would be looking to do deals there. I think the Dakotas, I’ve never financed anything in the Dakotas. ⁓ Would love to get an opportunity there, but I guess when…when that would mature.
Michelle Kesil (04:20)
Great, so you are able to serve nationwide?Moshe Orange (04:24)
I am able to serve nationwide. I’ve done a lot of business in Texas, Florida, New York, which is my home state, ⁓ New Jersey backyard. I’m currently working on deals in Pennsylvania, Louisiana. ⁓Michelle Kesil (04:45)
Awesome. And what are some of the main keys that have allowed your business to be able to grow and to run smoothly?Moshe Orange (05:41)
I guess that’s building relationships and giving the confidence ⁓ to the sponsor that I would be able to get them to the finish line and being honest about stuff, painting pictures that you know a lot of brokers are out there and theyfailed to deliver because the amount of promises, you know, just to get the deal in, they come with a beautiful picture. And the last two years, it was easier to distinguish who are brokers that are creative and honest, since rate really went up and setting the sponsors to, ⁓
setting them to what’s realistic out there in the market. And I had quite a few times that sponsors told me, you know, we had another broker saying that he would be able to get that deal for us with this kind of leverage and that kind of rate. And when they told me that it happened more than once that I said, you know what, if that’s the case, go with the broker you have.
And after hanging the phone, I knew that it’s just a matter of time until I’ll get a call back or to just continue on following up with that sponsor, knowing that those terms that they were promised, the broker they were working with will fail to deliver.
Michelle Kesil (07:21)
Yeah, definitely relationships are crucial.And so what are some of the challenges and obstacles that you have experienced in your role? And now looking back, you can see the lesson that has been learned.
Moshe Orange (07:45)
The challenges that I have and learned is setting expectations, always having a conversation, an open conversation with confidence of what’s out there in the market and trying to understand what is the sponsor’s goal. If you can get a better understanding of what the sponsor is trying to create, that can work ⁓ also when you’re… ⁓giving the story out to lenders and ⁓ when you come back with terms those are exactly where the sponsors put the expectation so he knows that on a high level these are what I’m going to these terms are what I’m going to face and when you set those expectations
the borrowers appreciate that. I think when I just started in the financing world, sometimes I would get nervous when sponsors told me, you know what, was told I was able to get that kind of financing or that kind of structure. And then I would get nervous and sponsors would sense that.
You you have certain kind of instincts which we can ⁓ feel them when we’re in the water and sponsors can definitely, especially when you’re speaking to ⁓ sophisticated sponsors, they can feel that. And when you have the confidence and have that open conversation and setting expectation on that first call and at the first meeting, they know that you’re
Going to deliver Based on those expectations. Yes the market, you know sometimes it happened that I especially 23 24 I would tell the borrowers, you know, this is where I’m setting the expectations however, this might change once Once we hear the next
employment or the next report from Mr. Powell because rates were starting to increase. you have to set those backup plans, have that conversation up first and when you set up those conversations it makes the deal close smoother.
I do have one
good memory of a roundup construction deal I was working on for the client. We were able to get him very high leverage from a regional bank in Philadelphia.
And I told him, you know, if you don’t move quick and the next report is out, this deal might collapse because you won’t be able to achieve that. The bank once they issued the term sheet, it has a timeframe.
of how long they will ⁓ honor that term sheet. And I told the sponsor if you don’t move quick, this deal is going to be dead. And he was betting that rates ⁓ will stay where they were. And the deal has collapsed once the lender pulled the rug under that term sheet.
Michelle Kesil (12:10)
Yeah, definitely sounds like the expectations and honesty are super important.Moshe Orange (12:18)
Correct. So yeah, you know those are also things that you build throughout relationships. I do, I still have a very good relationship with that sponsor. We have done deals since. I think looking backwards, you know, maybe then it was a little bit, I was pretty new to the business. So when I was giving him…Michelle Kesil (12:24)
you.Moshe Orange (12:48)
that feeling that rates might go up, might not, we don’t know where the market’s going. Without giving him that certainty, that made him hesitate. And the minute that hesitation came in, that pretty much killed the deal.Michelle Kesil (13:08)
Yeah, absolutely. And so what are you most focused on solving or scaling to in your business now?Moshe Orange (13:18)
I right now I just started my own financing firm. We’re called BFinanced and we do commercial real estate financing of course. Looking to scale we set goals for 26 and it’s going to be a fun ride so we’re looking forward to it.Michelle Kesil (13:42)
Yeah, and when it comes to financing, what sort of financing solutions do you provide? Maybe some are more creative than others that you’d like to share.Moshe Orange (13:55)
So every deal is very unique. The market is unique. The sponsor is unique. They have their own philosophy. They have their own way of doing business. They want to do things the way they want to do it. And understanding that and coming up to think on something creative. ⁓Now that rates were so high and ⁓ it was making it very challenging for sponsors ⁓ to refinance their current debt and to come up with instead of coming up with equity to refinance their current debt. So sometimes it was doing ⁓
sometimes getting them PACE loans when they were doing construction or sometimes getting them ⁓ land leases on the property. that creativeness, understanding the deal, understanding what the sponsor would need and what it would take, that was able to be a big help, especially when spreads and margins were so tight.
Michelle Kesil (16:01)
Absolutely. And so when you say sponsors, what is like the like who are these people? Is there a certain specific role that these people usually work in?Moshe Orange (16:15)
One of the things I find amazing in sponsors are real estate investors. ⁓ They’re people who usually did more than one or two deals with full cycles that I’m always trying to target. ⁓ The reason I target them is because they are sophisticated, they know how to underwrite, they understand the deals. ⁓and there are people who can get deals done and I find it very interestingly that one thought that always connects between most of the investors I deal with is they always are even though they face crisis from time to time they always manage to work their way through
And I think that’s also true to the financing world where I’m in. Each time I’ve closed millions of dollars in debt, I’ve never had witnessed a easy and smooth closing.
There’s always something that came up. There’s always an appraisal came short. This came that. Third parties did not come in on time. There’s always different challenges that come throughout. And these real estate investors, that’s something that they should really get credit for. They just get their deals done.
Michelle Kesil (18:03)
Yeah, absolutely. That’s awesome that they’re able to get the projects finished in that way.Moshe Orange (18:12)
Yep. find it, you know, I feel like I’m very lucky and fortunate that I work ⁓ in such an environment. My background was I worked for a few years as a bankruptcy attorney prior to financing.So it was a pretty big transition starting ⁓ working with unsuccessful and unsophisticated people who were filing bankruptcy to working with people who always try to find solutions to whatever they’re trying to do. And I feel like it’s a great blessing for myself to be surrounded with
people who get the othn.
Michelle Kesil (19:07)
Definitely. And what are some of the maybe advice you would give to the lenders or the investors that you work with when it comes to financing?Moshe Orange (19:25)
guess the best advice is giving. First of all you have to give it the time. You have to be responsive. In today’s world where the pace is so quick, if you snooze you lose.⁓ You just have to be, you know, a lot of people are sending offers on real estate transactions. A lot of commercial real estate financing brokers are out there. You have to be on top of your game. And the biggest tip I can give is build relationships as much as you can. Try to create a working network who
are a working network that is that you can try to ⁓ elevate on one side and on the other hand ⁓ they would be able to bring value to you as time you know nobody’s gonna send you a deal on your first cold call ⁓
Sometimes not even the second or the third. I have worked with a few sponsors that I knew for three, four years before they sent me their first deal to work on. just maintain those relationships. Continue on meeting more and more people and getting the word out of what you do, being clear about it.
and staying honest even though sometimes it seems like if I would just offer this sponsor the moon he would I would be able to get the deal from him
But sometimes, from my experience, sometimes it’s better to lose a deal and under promise and over deliver than over promise and then that relationship is over and you’ll never see a deal from that sponsor again. So be honest, ⁓ surround yourself with good people.
Give it time. These relationships take time to originate. If you give it the right time, you’ll be able to overcome every challenge.
Michelle Kesil (21:59)
Yeah, absolutely. And when it comes to finding deals, is that something that you are also doing or the deals come to you?Moshe Orange (22:14)
Nothing comes easy in the real estate world. If it was that easy, everybody would be doing it because it could be a very profitable business. ⁓ Maintaining relationships, ⁓ that’s gets people in the door. Giving it another call, going out for another coffee.Michelle Kesil (22:19)
short.Moshe Orange (22:42)
Yes, you have spent the time for those meetings, but going again and again showing your face being out there. ⁓ And yes, I am almost nine years in the business now. But also with nine years in the business, I still.have every single day more cold calls which those cold calls have to have a follow-up call and that follow-up call should create a meeting.
and that meeting sometimes would award you with a deal and sometimes not. If you’re calling again and again and they know your face and they see your face again and again, they will reward you that deal. In the real estate world, works. If the realtor sees your name again and again and he knows that
Once you need that proof of funds to he saw that once and then he sees your face again and again He’ll reward you that deal You’ll get that deal in It might take sometimes it might take a month. Sometimes it might take six Sometimes it will take a year and sometimes it will take more than that, but you just have to be out there at all times
Michelle Kesil (24:03)
Yeah, absolutely. That makes sense. Great, thank you for sharing. So before we begin to wrap up here, if someone wants to reach out, connect, learn more about what you’re up to, where can people find you and connect with you?Moshe Orange (24:19)
So I am on LinkedIn. ⁓ One of my goals this year was being more creative on LinkedIn. My company’s name is BFinanced. So you can find me also online. My current website is ⁓ on the works. So it will take a little bit more time, but you can definitely reach out to me on LinkedIn. I would like just to share one more story before I go, which I…Michelle Kesil (24:45)
Go for it. Sure.Moshe Orange (24:48)
So this happened to me ⁓ I think last year. ⁓ Somebody who I know, who I met at ⁓ a network event recommended I speak to a friend of his. He told me you just need to give it the patience and the time. The guy’s not really sophisticated but you’ll get the deal done for him. You just give it the time.I said okay I saw already everything I’ll you know I have a good relationship with the guy who recommended so I said you know I’ll I’ll do that and I have reached out to the sponsor and he told me I was expecting this call and let me know what you need and I’ll send it to you and surely when we were getting to the end of the call he asked me if he can fax it to me
all the information. So I told him I don’t really use fax, but you can email the information to me. And when he did, I was really surprised that everything was written by pencil. With the ruler, the whole T12, the current rent rolls, everything was just on pencil. I’ve never seen something like that. The guys in his…
holds a nice portfolio in one state. He’s not all over the place. He’s in one state and not really sophisticated in the financing world because he drew, you know, he’s 40 years in the business, never did a agency loan in his life, always was very low leveraged, ⁓ has a nice size portfolio.
But everything was on pen and paper. And like the old days. So that was really refreshing and fun to see. ⁓ And yes, always it’s always nice to get fresh surprises in this realm of work.
Michelle Kesil (27:01)
Yeah, absolutely. I’m sure that was unique.⁓ Well, appreciate your time and your story. Thank you for being here.
Moshe Orange (27:11)
Absolutely. Thank you Michelle for ⁓ hosting and looking forward to connecting again in the near future.Michelle Kesil (27:22)
So yes, absolutely. And for the listeners tuning into the show, if you got value, make sure you have subscribed. We have more conversations with operators who are building real businesses and we’ll see you on the next episode.
