GlobeSt.com: Why are lenders such as Sutherland targeting this market while banks tend to steer clear of it?

Petriella: According to the Federal Reserve, the US commercial mortgage market including multifamily residences, and non-farm, non-residential mortgages totaled approximately $3.3 trillion as of September 2014. The SBC market is fragmented. According to data from Boxwood Means Inc., a real estate research and consulting firm, the top 10 SBC lenders by volume accounted for approximately 18% of the total SBC loan production for 2013.

SBC is difficult to develop 'flow' business from and, while there are excellent local banks and agencies servicing this market, most platforms akin to ours focus on larger deals and have typically avoided these $1-million to $10-million range opportunities, believing there is more risk involved and higher underwriting costs. Sutherland has been able to fill this underserved market need.

GlobeSt.com: Are there commercial property sectors that represent an especially good source of opportunities in the near term? (e.g., medical office)

Petriella:This is no mystery: anywhere you find job growth, you will find opportunity in most asset classes. Having said that, there are special use properties such as medical—in its many formats—that represent opportunities. Long-term care, senior housing are also being talked about because of demographics as is repositioning of older office buildings into tech friendly or mixed use. In New York City, older walk-ups are being repositioned into appealing places to live for millennials. In the secondary markets, net leased assets are still popular and are credit tenant warehouse, distribution and other forms of industrial properties.

GlobeSt.com: What is special about the Sutherland REIT platform?

Petriella: What separates us from the pack is the comprehensive suite of offerings we have for small to midsize businesses. We can offer lending through our wholly owned subsidiary ReadyCap Commercial as well as brokerage services, including sales, leasing and transaction management, through our other subsidiary Coldwell Banker Commercial Alliance. We own thousands of commercial loans, have securitization expertise and are active B piece buyers and hold the B pieces of loans we originate through RCC, offering borrowers tremendous flexibility otherwise unheard-of. There is no other platform I know of like ours.

GlobeSt.com: Describe your relationship with Waterfall Asset Management.

Petriella: We are essentially managed and advised by Waterfall Asset Management, an investment manager with approximately $4.3 billion in client assets under management as of Dec. 31, 2014. They serve as our primary financial backer and are involved in our business from a resource and synergistic perspective.

GlobeSt.com: How do you see the Sutherland platform evolving over the next 12 to 18 months?

Petriella: We saw an opportunity in the underserved small balance lending sector and have capitalized on it. We now believe we're in an excellent position to continue our growth in to a leader in this market. This market segment continues to expand with more and more small balance loans being transacted every year in most major sectors, including office, retail, industrial and multifamily. Our platform is designed to service this market, and we will be expanding CBCA into four additional markets and growing staff to take advantage of the wall of refinancing opportunities coming to market.

GlobeSt.com: Why are you seeking to provide services to entrepreneurial CRE investors and owners?

Petriella: We understand the opportunities the small balance market presents. Again, this is an underserved an inefficient market space that is growing. These investors need the same competitive rates banks offer but with more “borrower-friendly” and flexible loan terms. That's something we can offer.

GlobeSt.com: What types of services are these users needing?

Petriella: Just like their larger counterparts, the needs of these small and midsize users covers the entire commercial real estate spectrum, ranging from funding with beneficial terms to capital markets services and brokerage assistance.