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Marcus & Millichap Buying Pinnacle Financial to Expand Midwest Financing Business

Investment Brokerage Has Been On the Hunt for Mortgage Banking and Servicing Firms
May 9, 2018
Marcus & Millichap President/CEO Hessam Nadji, left, said the addition of the Pinnacle Financial team led by Jim Leonard, right, will extend the brokerage firm's capital markets reach in the Midwest.

Making good on strategic plans to grow its mortgage brokerage and servicing business, Marcus & Millichap announced a deal to acquire Cleveland-based commercial real estate finance firm Pinnacle Financial Group, Inc.

Founded in 1990 and now one of the largest independently owned financing companies in the Midwest, Pinnacle Financial fills a gap in financing and mortgage servicing for Calabasas, CA-based Marcus & Millichap, noted President and CEO Hessam Nadji.

"The Pinnacle team will provide our investment sales professionals and clients with financing options for all major property types including bridge loans, mezzanine financing as well as construction loans," Nadji added.

In a February interview with CoStar News, retiring senior vice president of Marcus & Millichap Capital Corp. William E. Hughes said acquiring mortgage banking companies with servicing platforms with lender relationships was a major initiative for Marcus & Millichap.

"In general, it will be easier to grow by adding multiple originators at one time rather than one originator at a time," Hughes said in February.

Pinnacle also brings a well-established and sizable mortgage-servicing portfolio and relationships with life insurance companies and CMBS lenders that compliment the investment brokerage's capital markets group, Marcus & Millichap Capital Corp. (MMCC).

Pinnacle President Jim Leonard and principals Brock Walter and Brian Stulak will join Marcus & Millichap. Leonard said the combination would help scale-up MMCC’s growth by adding Pinnacle’s lender network and mortgage servicing platform.

"We are excited for the opportunity to be involved in more transactions in a wider geographic area," Leonard said. "This will allow us to better leverage our relationships with lenders and continue to expand our capital sources."

The acquisition is scheduled to close by the end of the second quarter.

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