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MCLEAN, VA-Wells Fargo & Co signed a definite agreement for Wells Fargo Bank to acquire the assets of locally based Reilly Mortgage Group from a group of investors led by Stonehurst Capital LLC. The privately owned, multifamily real estate finance firm will become part of Wells Fargo Wholesale Banking's Specialized Financial Services Group.

Terms of the agreement were not disclosed. Subject to regulatory approval, the acquisition is expected to close in the third quarter of 2006.

Ed Blakey, head of Wells Fargo's Commercial Mortgage Group, tells GlobeSt.com that the acquisition will allow Wells Fargo to move beyond the short-term, floating-rate, construction-oriented multifamily financing that it has mainly provided up until now. "Wells Fargo does about $35 billon in commercial real estate financing, including multi family production." But of that amount, multifamily consists of only $3.5 billion to $4 billion. To expand into permanent debt products, he says, an institution would need a fully dedicated team to have a material impact. "Most of our people are generalists."