December 27, 2018
Just like that, the new year is just around the corner! While we’re excited for next year, we’d like to reflect on a year of growth for Bay Mountain Capital.
Let’s take a look at some of the accomplishments we’re most proud of from this year:
Asset under management increases by almost 20%
At the beginning of 2017, BMC set an ambitious company-wide goal of reaching $150 million in AUM. We’re aiming for this to come into fruition at the end of a five-year plan ending in 2022.
We couldn’t have imagined a better start to accomplishing that goal. In 2018 alone, our AUM increased by almost 20%. Due to this, we’re well on our way to achieving $150 million in AUM by the conclusion of 2022.
At BMC, we partner with borrowers every day. We aim to help them secure quick closings so they can achieve their own financial goals.
Ironically, we were intentional about specific investments we made within our own company that would position us to achieve this kind of growth:
BMC employee growth
Like with any company, the company growth is due to multiple facets. Not only does an increase in personnel impact it, but also the quality of employees hired during expansion.
We made key hires in an analyst role and the production team. Additionally, we supplemented our executive leadership with a new chief investment officer. These new hires possessed valuable experience in the direct money lending business and fit into our mentality at BMC. Our commitment to treat borrowers as partners, alongside our focus on business development, is critical to our growth.
Not staying complacent
For us, growth is more than just increasing our staff or assets under management. Growth also means refusing to stay complacent and always looking for ways to improve our workflows.
In 2018, we updated our processes for underwriting and asset management to further streamline both areas and ensure they aligned with our four core values – integrity, respect, improvement, and excellence.
Furthermore, we also made significant updates to our rates in order to stay competitive within our industry. As always, our rates are completely transparent with our borrowers. With our two programs – based on credit score – we’ve lowered our interest rates on single-family fix and flop loans by more than a point to ensure our borrowers are getting the best deal. Credit scores of 680 or higher will garner a 10.9% interest rate, while below a 680 score will net an interest rate of 12.5%.
Looking back at 2018 and into the future for the real estate industry
A strong economic year for the United States directly resulted in a strong year for the real estate industry. In addition to the economic prosperity that helped to elevate the market, price growth, low inventory, and surging buyer demand made for a healthy and growing real estate industry.
Although BMC operates in debt market, 2018 seemed to usher in more equity investors due to increased costs and expenses for borrowers. Bigger players are also coming into the space and acting as a conduit throughout the entire financing process.
Looking into 2019, it seems as if everyone is waiting for the other shoe to drop. However, while supply and demand will likely level off in 2019, that doesn’t mean we’re headed for a similar recession and bottoming out of the real estate market like we experienced around 2008.
We anticipate another strong year for real estate investments and we are prepared to partner with our existing and new borrowers to help everyone achieve their investment goals in the new year.