Spring Garden Lending, a Philadelphia loan company run by former Valley Green Bank boss Jay Goldstein, says it has raised a total of $61 million from banks and investors to expand its lending to builders, rehabbers, developers and refinancers of homes “for rent or flip” in the city, its suburbs, and its new markets in the Baltimore area.
The total includes $16 million in equity investment and $45 million in financing from 10 community banks.
In Baltimore, Spring Garden will specially target developers of “moderate income housing,” backed by a $7 million credit facility from The Reinvestment Fund, a nonprofit Philadelphia lender. TRF managing director Dana Johnson said Spring Garden has a “track record” of working with small developers on homes priced for “families with modest incomes.”
The company says it lent $75 million last year in Philadelphia and in its Pennsylvania and South Jersey suburbs.
Spring Garden now plans to expand with a new Baltimore office to be headed by Bob Marino, a former Valley Green executive and board member who was previously head of Broad Street Consulting. Marino is also a Spring Garden director. Univest Corp., of Souderton, bought Valley Green for $76 million in 2014, triple the value of shares at the bank’s founding in 2005.
As a locally-focused lender without an expensive branch network or bank compliance requirements, Spring Garden is now in the “sweet spot,” said Goldstein in a statement, bragging his company is “faster than a bank and less expensive than a hard-money lender.”
Marino added that both Philadelphia and Baltimore, where home prices have been rising, contain “diverse neighborhoods, growing millennial populations, robust universities and medical centers and a steady real estate market.”