Dan Flanigan and the US Commercial Mortgage Backed Securities Industry
Finance Monthly connected with Dan Flanigan – the Managing Partner at Polsinelli’s New York office, who’s also the Founder of the firm’s financial services practice. Established 20 years ago, the department offers a wide range of debt-related legal services in one tightly integrated practice group – from origination through servicing, through to enforcement, bankruptcy and […]
Finance Monthly connected with Dan Flanigan – the Managing Partner at Polsinelli’s New York office, who’s also the Founder of the firm’s financial services practice. Established 20 years ago, the department offers a wide range of debt-related legal services in one tightly integrated practice group – from origination through servicing, through to enforcement, bankruptcy and more. Started with only seven lawyers working in the department, Polsinelli’s financial services practice has grown to 100 people today.
According to Chambers USA, Dan Flanigan’s clients refer to him as a ‘master strategist’ and consummate problem solver. Dan has been selected for inclusion in Best Lawyers In America
2018 in each of the following areas: Banking and Finance Law, Real Estate Law, Bankruptcy and Creditor-Debtor Rights/ Insolvency and Reorganization Law, Litigation–Banking and Finance, and Litigation–Bankruptcy.
Dan is a trusted adviser to lenders, helping them navigate the ups and downs of the business cycle. He also makes his financing expertise, and deep knowledge of the lending environment and culture, available to Polsinelli’s borrower clients, especially in difficult restructuring and workout situations. In recent years Dan has been intensely involved in the commercial mortgage backed securities industry (CMBS).
Here, Dan tells us about his career and the CMBS industry in the United States.
Your practice is so diverse – how do you overcome the technical challenges of working within so many different areas?
When I was a young lawyer, specialisation was not as embedded as it is today – especially in the finance world. In a market like Kansas City, where my career path began, it wasn’t unusual for a skilled professional to be helping bank clients with an extensive range of services. I was lucky that I grew up and trained in a time when you didn’t need to specialise in one thing only, as this allowed me to get an insight into a number of areas of focus and develop a wide range of skills.
My real estate practice was a logical step from finance because when you work within finance in the US, it’s hard not to get into real estate, too.
My piece of advice for overcoming technical challenges is to stay up-to-date and read as much as you can about new trends and developments and you have to “burn the midnight oil” but it is worth the effort.
What are any interesting cases that you are currently working on?
At Polsinelli, we are very involved in the so-called ‘retail apocalypse’ in the US. Our country is incredibly over-retailed and shops are closing every day, due to factors such as over-expansion of malls, rising rents, bankruptcies, low profits outside of holiday binge spending, etc.
Big malls across America have been a significant part of Commercial Mortgage-Backed Securities (CMBS) pools. CMBS is a type of mortgage-backed security, secured by mortgages on commercial properties, instead of residential real estate that can provide liquidity to real estate investors and commercial lenders. We have been very involved in the general movement of debt from a public regulated banker type of product into the so-called ‘private debt market’.
More generally, we represent loan originators, issuers, loan sellers and servicers on a national basis in all aspects of the CMBS market and other real estate finance.
What drew you to the CMBS field?
The CMBS industry came about in the mid and late 1990s as a response to the debt crisis for commercial real estate in the US that was a consequence of the SNL crisis. In the early to mid-1990s, it was nearly impossible to get any financing. Thus, the securitisation market was invented with the objective of helping to alleviate this situation.
What we were able to see in Kansas City for example was that all funds were moving to central locations, especially New York. Securitisation was a Wall Street invention.
CMBS fits perfectly because I had experience in all of the components required for CMBS, such as lending and bankruptcy for example. Banks were failing at that time and some of my bankrupt clients ended up developing a CMBS origination platform and I followed them religiously, ultimately ending up in New York.
Polsinelli is an Am Law 100 firm with more than 825 attorneys in 21 offices. Ranked #24 for Client Service Excellence and #10 for best client relationships among 650 US law firms, Polsinelli is also named among the top 30 best-known firms in the nation for the second consecutive year. The firm’s attorneys provide value through practical legal counsel infused with business insight and a focus on health care, financial services, real estate, intellectual property, mid-market corporate, labor and employment, and business litigation.